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Quoted Micro 28 October 2024
AQUIS STOCK EXCHANGE
Electrification technology developer Equipmake (EQIP) has raised £3m at 3p/share. Chief executive Ian Foley has subscribed for 6.67 million shares, although his stake will be diluted to 34.1%. The cash should last for six months and move the business towards cash breakeven. There was £2.48m in the bank at the end of May 2024. In the year to May 2024, the cash outflow from operations was £6.3m. The company estimates a requirement of £5.5m for working capital over the next 12 months. A potential licensing agreement could bring in £4.6m over a two-year period. Equipmake could reach cash breakeven in 2025-26. The focus is on higher margin work and bus repowering range will be rationalised. Costs are also being reduced, but it is investing in its commercial team.
Igraine (KING) has secured right of first refusal on current and future battery storage projects developed by GEM Energia. AIM-quoted Vela Technologies (VELA) is providing a loan facility with a minimum commitment of £200,000. Igraine will issue 35.5 million shares, which is 29.1% of the company, to GEM in return for the rights. David Levis, the chief executive of GEM, is joining the Igraine board as an executive director. He founded GEM to develop battery energy storage projects in the UK. It develops the projects up to the point where it either sells them or proceeds with the development itself. Igraine will have the right to receive 8% of the sales proceeds of a disposal or be involved in their further development. Initial sites will be sold to generate cash for Igraine and strengthen the balance sheet. Each site requires £150,000-£250,000 to secure grid connections and get to the ready to build stage. Every MW of capacity is valued at £120,000. After costs, a 100MW site could generate cash of more than £7m. There are four sites which are already in progress.
Oscillate (MUSH) has started hydrogen operations in Minnesota. A hydrogen soil-gas sensor has been bought and pre-field work started, which will provide data to enable further progress. Igraine has been diluted from 10.2% to 5.05% following the recent share issue.
Lift Global Ventures (LFT) says investee company Trans-Africa Energy has not received the £12m it was waiting for from an African investor. It is talking to alternative sources of finance for the energy infrastructure project in Ghana. The redemption date on the loan notes held by Lift Global Ventures has been extended to the end of 2024 and in return the value will be increased from £1m to £1.25m.
Ananda Developments (ANA) says two of its potential medicines, MRX2 and MRX2T, will be used in National Institute for Health and Care Research and NHS co-funded phase IIIa epilepsy clinical trials involving up to 500 patients. This could support marketing authorisation applications if the trials are successful.
EDX Medical Group (EDX) has raised £300,000 from a Saudi Arabian investor at 11p/share, which was a 22% premium to the market price.
Corporate businesses developer Macaulay Capital (MCAP) managing director David Horner has doubled his shareholding to 500,000 shares by buying 250,000 shares at 20p each. His family has a 24.9% stake. Marula Mining (MARU) director Jason Brewer has increased his shareholding by 340,000 shares at 5.38p each. That takes his stake, held through Gathoni Muchai Investments to 9.13%. Mike Cass has increased his stake in BWA Group (BWAP) to 15.1%. James and Alexandra Pace have a 5% stake in Shepherd Neame (SHEP).
AIM
Footwear retailer Shoe Zone (SHOE) says that poor weather hit second half sales, but it has traded in line with expectations. Full year revenues were 3% lower at £161.3m with a second half decline wiping out the interim growth. Trading did improve in August and September. Zeus forecasts a fall in pre-tax profit from £16.5m to £9.5m. The full year dividend will slip from 17.4p/share to 6.2p/share.
Disinfection products supplier Tristel (TSTL) beat expectations in the year to June 2024. There were initial revenues from the US, but they will take time to build up. Sales grew in nearly every market, with small dips in Australasia and China. A price increase in the UK, combined with higher volumes, helped hospital medical device decontamination jump 38%. The main growth in sales is in the UK and Europe. In the year to June 2024, revenues improved from £36m to £41.9m, while pre-tax profit rose from £6.2m to £8.2m. There was a reallocation of costs from overheads to cost of sales, so this affected comparatives. The total dividend was raised 29% to 13.52p/share.
Telecoms enterprise software provider Cerillion (CER) continues to grow faster than its underlying market. Revenues were 14% higher in the second half, enabling profit to be better than expected. There are record new orders and this underpins further growth in the next couple of years. The €12.4m order from the previously unnamed Virgin Media Ireland is contributing to the growth. It probably generated £6m last year. This is the first contract with a tier-1 telecoms company and could help to win other contracts with this level of business. In the year to September 2024, revenues were 12% ahead at £43.8m.
Online marketing services provider XL Media (XLM) is selling its North American business for up to $30m in cash, with $20m payable on completion and up to $10m in April – based on revenues and gross profit in 2024. Some cash should be redistributed to shareholders by the end of the year. The company will effectively become a cash shell.
EnergyPathways (EPP) has been asked by the UK government to participate in the Hydrogen Storage Business Model. This will help to define the new investment support scheme. The first Hydrogen Storage Allocation Round should be in 2025.
Seascape Energy Asia (SEA) has been awarded a 28% participating interest in a production sharing contract over the DEWA complex cluster, offshore Sarawak, Malaysia. Enquest owns 42% and Petroleum Sarawak holds 30%. The area has 12 gas discoveries in shallow water near to the coast. Six will be focused on and these have 500bcf of gas in place. Seascape Energy Asia will commit $600,000 for a detailed resource assessment and field development plan.
Specialist recruitment firm Gattaca (GATC) reported an underlying 2023-24 pre-tax profit decline from £3.7m to £2.9m on 5% lower net fee income of £40.1m. There was a 3% increase in net fee income for contract work, but permanent income dropped by one-third. Despite the decline, Gattaca is gaining market share. Costs have been reduced and the US business has been sold. There could be a modest improvement in profit this year.
Prospex Energy (PXEN) recently acquired a 7.2365% working interest in the onshore Spain Viura gas field, which recommenced production last week. The Viura 1B development well has encountered significant gas shows in the Utrillas-A reservoir and a new gas bearing reservoir interval below that. The well, which cost Prospex Energy €375,000, could contribute to production in November Flow testing results for the deeper reservoir will be available next year. There should be a significant upgrade to recoverable reserves. The European gas price is rising.
Musical instruments retailer Gear4Music (G4M) continues to recover with growth in the second quarter nearly offsetting the decline in the first quarter and further improvement in October. In the six months to September 2024, UK sales grew 4%, but European sales declined. Total sales were 1% lower at £61.7m. Gross margin has fallen back, but the interim loss will be reduced. Full year revenues are expected to be higher and pre-tax profit could jump from £1.1m to £2.8m.
Information and data publisher Merit Group (MRIT) has been hit by the ending of project work and the lack of replacement work. Sales resource is being added, but that will take time to boost revenues. Canaccord Genuity has changed its 2024-25 forecast from a £900,000 profit to a loss of £800,000 after a 11% reduction in expected revenues to £18.5m, which is lower than the 2022-23 figure. A return to profit is forecast for next year. There are management changes that are flagged for next year.
Ariana Resources (AAU) has reviewed the data for the Dokwe gold project in Zimbabwe. There are several zones of potential extensions to mineralisation. There are also gold-in-soil anomalies to follow up and drilling is planned. The in-pit resource is 1.2moz in two open pits at Dokwe Central and Dokwe North. Measured and indicated resources are 30Mt at 1.3g/t gold. Ariana Resources believes there could be annual production of up to 100,000 ounces of gold for up to 15 years. A revision of the pre-feasibility study is underway.
At the end of the week, property developer and investor Caledonian Trust (CNN), which has been on AIM for more than 29 years, announced its proposed departure. The direct annual cost of the quotation is £100,000 and liquidity is poor. A general meeting to gain shareholder approval will be held on 18 November. There is already support from holders of 85.3% of the shares. The quotation could end on 26 November. NAV is 195.1p/share.
Adams (ADA) is proposing the cancellation of the AIM quotation and sell off the company’s investments, many of which are also quoted on AIM, to return the cash to shareholders. Prior to this Adams will be buying back shares at 4p each. The estimated NAV is 3.72p/share. Liquidity is limited because Richard Griffiths owns 94% of Adams. A general meeting will be held on 27 November and, if passed, the cancellation will be on 5 December.
MAIN MARKET
Advanced materials developer HeiQ (LON: HEIQ) has found growing its business difficult, particularly in textiles, flooring and antimicrobials and not recovery is expected until well into 2025. Another restructuring plan will cut costs and focus on certain facilities. Non-core operations will be scaled back. Some parts of the business may be sold, and outside finance is being sought for AeoniQ. Part of the cost cutting is giving up the listing. This should take effect on 19 November. Because the shares are on the transition category of the market since the restructuring of the Main Market, no shareholder vote is required. The shares will be traded by JP Jenkins. Daren Morecombe has increased his stake from 14.5% to 22%.
Bloomsbury Publishing (BMY) grew interim revenues by 32% to £179.8m, while pre-tax profit jumped from £17.7m to £26.6m. This is due to strong consumer division revenues due to strong sales of fantasy fiction and cookery books.
LED lighting and wiring accessories supplier Luceco (LUCE) increased third quarter revenues by 3% with residential EV charging the main growth area. However, excluding acquisitions, like-for-like revenues were 3.6% lower, partly due to phasing of orders so that there is a strong fourth quarter order book. Margins are improving. Net debt was £67m at the end of September 2024.
Andrew Hore
Quoted Micro 16 September 2024
AQUIS STOCK EXCHANGE
Exchange services provider Aquis Exchange (AQX), which is also quoted on the Aquis Stock Exchange, has already warned that the loss of a software contract will hit revenues this year. Net interim revenues were still 4% ahead at £10m. Pre-tax profit was 8% lower at £1.1m. There was a small dip in revenues of the core exchange division. Net cash was £14.5m at the end of June 2024. There are plans to increase investment in technology to increase the addressable market, so year-end cash will be slightly lower than expected at £15.1m.
SulNOx Group (SNOX) increased revenues from £203,000 to £544,000, but the loss was still around £1.9m. Cash was £2.15m at the end of June 2024. A generator-based study for the SulNOxEco fuel additive shows fuel savings of 15%.
Ananda Developments (ANA) has raised up to £2.1m via a placing and offer at 0.3p/share and more than £2m has come from Charles Morgan, the company chairman. Charles Morgan and Melissa Sturgess have agreed to capitalised debt owed to them. The cash will fund the manufacture of MRX1 for CIPN and Endometriosis phase II studies, as well as a pharmacokinetic study for MRX1 in Australia.
Newbury Racecourse (NYR) improved interim revenues 16% to £9.28m, while the cost base rose 11%. The loss was reduced from £649,000 to £352,000. The remainder of the year is expected to be difficult.
The increase in the value of the 15% stake held by Global Connectivity (GCON) lead to the July 2024 rising from £7.8m to £17.2m in a six-month period. That is 4.25p/share.
Walls and Futures REIT (WAFR) reported a 4.5% decrease in NAV to 85p/share, although investment property value rose 2.4%. The was reduced to £44,000. The company is finding it difficult to raise additional funds.
Ace Liberty and Stone (ALSP) maintained revenues at £5.6m. There is 96% occupancy of the group properties. NAV fell from £34.4m to £31.7m at the end of April 2024.
Voyager Life (VOY) says that M3 Helium’s preparations for bringing the Rost1-26 well into production are advanced. Voyager Life has an option to acquire M3 Helium.
Cooks Coffee Company (COOK) increased sales by 23% to £13.8m in the 22 weeks to 1 September. The main growth was in the UK stores. Ten further outlets ae expected to open by the end of the financial year.
Investment company EPE Special Opportunities Ltd (EO.P) reported a reduced loss because there was a gain on fair value movements on investments compared with a loss last time. There was cash of £18.4m at the end of July 2024. NAV was 319p/share at the end of July, and it fell back to 314p/share by the end of August.
Warrants held by lupus treatment developer ImmuPharma (IMM) to subscribe for shares in Incanthera (INC) at 9.5p each have been extended to the end of March 2025 in return for a £75,0000 payment by ImmuPharma.
BWA Group (BWAP) chairman Jonathan Wearing has subscribed for 50 million shares at 0.5p each.
Jonathan Adnams has stepped down as chairman of Adnams (ADB) because of ill health. Simon Townsend will be interim chairman.
AIM
Greatland Gold (GGP) shares returned from suspension after announcing the purchase of Newmont Corporation’s 70% stake in the Havieron gold-copper project, as well as 100% ownership of the Telfer gold-copper mine and other assets in the Paterson region. The total cost is $475m in cash and shares. A placing raised £248.6m ($325m) at 4.8p each, which is a 30% discount to the market price. Wyloo is subscribing up to $100m and Newmont Corporation will own more than 20% of the gold explorer. A retail offer raised £6.7m.
Marlowe (MRL) is demerging the occupational health division as an independent AIM company called Optima Health by the end of September. Shareholders will receive one share for each Marlowe share held. Marlowe will focus on testing, inspection and certification operations. So far, £41m of the £75m share buy back has been spent. Marlowe continuing revenues are forecast to be £306m and pre-tax profit £13m.
Energy optimisation services provider Inspired (INSE) interim revenues edged up from £44.6m to £45m and pre-tax profit dipped from £6.2m to £5.7m. That was lower than forecast. Optimisation revenues declined, but product mix meant that margins were better. Cross-selling is helping to grow the ESG division and other parts of the business. Net debt is £57.6m. There is only £2.2m of contingent consideration due to be paid. Debt should start to decline over the next few years.
Chain and transmission equipment Renold (RNO) has made another earnings enhancing acquisition. Canada-based MAC Chain Company is being bought for $31.4m. This fits well with the CVC business and enables expansion into the forestry market. Last year’s pre-tax profit was $3.5m.
Optimisation software provider Checkit (CKT) reported a flat loss of £2.3m on the back of a 16% increase in interim revenues to £6.7m. However, the full year figure is set to fall from £4.2m to £3.9m. Annualised recurring revenues are £13.8m and that underpins the full year revenues forecast of £14.2m. Net cash was £7m at the end of July 2024 and higher R&D spending means that year-end cash is likely to be slightly lower than previously expected at around £5m. Chairman Keith Daley bought 135,000 shares at 21p each.
Cross-border currency payments services provider Finseta (FIN) reported a sharp increase in first half profit, although investment in growing the business will hold back profit in the short-term. There was a £100,000 contribution from the final payment relating to the licencing agreement with Avila House. The loss of that income, a higher depreciation charge and additional overheads for new operations such as a corporate Mastercard and a Canadian office means that full year pre-tax profit could dip from £1.4m to £1.3m. The benefits of the investment will be seen next year with an expected jump in pre-tax profit to £2.5m.
Contract research and infectious disease study services provider hVIVO (HVO) reported 2024 revenues 31% ahead at £35.6m, while pre-tax profit improved from £4.18m to £7.15m. The new Canary Wharf site has opened and provides additional capacity. Cash was slightly lower than anticipated at £37.1m.
Gaming machines hardware and displays supplier Nexteq (NXQ) was hit by destocking in both of its divisions. Interim revenues and profit were expected to fall. Interim revenues were 14% lower at $48.2m. Net cash reached $36.9m. The full year revenues forecast is being maintained at $93.9m to £114.3m.
Packaging equipment and automation provider Mpac Group (MPAC) reports a strong improvement in first half figures, although the comparatives were weak. Revenues improved from £52.8m to £60m, while pre-tax profit rebounded from £1.9m to £4m. The closing order book is £71.4m. Net debt is £4.9m and should be lower at the year end.
Trading in Eurasia Mining (EUA) shares has resumed following the publication of 2023 accounts late on Friday. Net cash was £1.1m at the end of 2023. The company has also agreed a one year working capital facility for up to £2.5m. The loan lasts until next August and is convertible at 2.7p/share. There are five tranches with around £1m of the loan dependent on a term sheet to sell the Russian asset. The lender will receive a payment of 12.5% of the facility, plus 5% of any draw downs, in shares at 2.3p each.
Shore Capital upgraded animal feed additives supplier Anpario (ANP) after it reported an 11% increase in interim revenues of £17m on the back of a much greater rise in volumes and slightly lower pricing. Raw material costs have stabilised. Full year revenues expectations have been raised from £33m to £34m, while the pre-tax profit estimate is increased from £3.9m to £4.4m, up from £3.5m in 2023.
Fulcrum Metals (FMET) is raising £643,500 at 8p/share and directors will subscribe for an additional £114,500 once the interims are published. The cash will be invested in the Teck-Hughes and Sylvanite gold tailings projects in Canada. This should enable nearer-term revenues Management will also review opportunities for exploration drilling on the Tully and Big Bear prospects and a potential technology testing facility in Ontario.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LUCE) interim revenues improved 8% to £109.6m and underlying pre-tax profit rebounded from £9.4m to £11.2m. Like-for-like growth was 3.6%. The interim dividend was improved from 1.6p/share to 1.7p/share. LED lighting revenues declined, while portable power and wiring accessories revenues improved. Panmure Liberum forecasts a full year pre-tax profit improvement from £21.2m to £23m.
Hostmore (MORE) has terminated the proposed acquisition of the TGI Friday’s master franchise owner. The sale of corporate stores has reached an advanced stage. However, the proceeds may be lower than the value of related borrowings so there will be no return for the company. Once the sale is complete the holding company will be wound up.
Critical Metals (CRTM) has raised £50,000 from NIU Invest and has entered into a term sheet for a cash injection of up to £2.5m. NIU has already invested £1.1m in convertible loan notes as is the latest investment. The conversion price is 2p/share. NIU is also receiving warrants exercisable at 0.5p/share.
Shell company Ikigai Ventures (IKIV) has been moved to the new, temporary shell category. This provides one year to comply with additional requirements and a further two years to make an acquisition.
Andrew Hore
Quoted Micro 5 February 2024
AQUIS STOCK EXCHANGE
Interim figures from DXS International (DXSP) show a 2.5% improvement in revenues to £1.69m, while higher amortisation charges led to an increased loss of £258,000. The healthcare IT company hade £386,000 in cash at the end of October 2023. Hybridan has trimmed its full year revenues forecast to £3.8m and expects a 2023-24 loss.
Silverwood Brands (SLWD) reported revenues of £5.85m for the first half of 2023. The loss was reduced from £299,000 to £189,000. The Lush transaction is still being unwound. Net debt was £8.6m. Chief executive Andrew Gerrie is subscribing £1m for shares at 54p each. The unsecured loan of £4.4m will be converted at the same price and the accrued interest will also be converted at the lower of 54p and the average closing price for five days prior to conversion. The share price is suspended at 30p.
Helium Ventures (HEV) had cash of £116,000 and net assets of £229,000 at the end of October 2023. There were costs relating to the cancelled acquisition of Trackimo. There is still an investment in Trackimo, which is expected to float on AIM.
Hydrogen Future Industries (HFI) had a cash outflow from operations of £963,000 in the year to July 2023. Cash was reduced to £262,000. The company is making progress with the testing of wind turbine technology and its electrolyser technology. The wind turbine technology has better performance, so far, than existing rivals. A mining sector feasibility study for hydrogen and clean water production has commenced.
Capital for Companies (CFCP) increased revenues from £492,000 to £887,000 in the year to August 2023. NAV was 81.99p/share. It was 81.67p/share at the end of November 2023. There was cash of £1.99m and loan receivables of £2.43m at the end of August 2023. A final dividend of 2p/share is payable on 8 March.
KR1 (KR1) had NAV of 109.91p/share at the end of 2023. Income from digital assets was £1.58m in December.
Shaun Hinds will become chief executive of Newbury Racecourse (NYR) on 3 June. Julian Thick has stepped down as chief executive. Mark Leigh will be interim chief executive.
Cadence Minerals (KNDR) investee company Hastings Technology Metals has signed an agreement with the investment agency of Estonia to collaborate on a joint scoping study for the potential development of downstream rare earth processing opportunities. The main focus is the Yangibana project.
Voyager Life (VOY) has acquired CBD brand Amphora Health for £50,000 in shares at 12p each. This payment could double if Amphora product sales exceed £100,000 over 24 months. In the year to July 2022, revenues were £69,000. No increase in group overheads will be required and manufacturing will be brought in house.
Quantum Exponential (QBIT) had net assets of £3.11m at the end of October 2023, including £831,000 in cash. There are seven portfolio investments. A European headquarters has been established in Copenhagen.
Psych Capital (PSY) had £133,000 in cash after a £254,000 cash outflow from operations in the six months to October 2023.
Valereum (VLRM) has completed the acquisition of GSX Group.
Digby Try has cut his stake in Supernova Digital Assets (SOL) from 5.1% to 0.36%.
AIM
Tekcapital (TEK) investee company MicroSalt (LON: SALT) raised £3.14m at 43p/share when it joined AIM on 1 February and immediately went to a significant premium with the share price ending the week at 55p, valuing the company at £31.4m. That values the Tekcapital’s 77.2% stake at £24.2m, which is more than its market capitalisation.
Trading has recommenced in Location Sciences (LSAI) shares after the publication of readmission document for the proposed acquisition of Sorted Holdings for nominal consideration and the assumption of £4.7m of debt. Sorted Group has developed delivery software for ecommerce businesses. There will be a one-for-625 share consolidation and £2m will be raised at 87.5p/share. The company’s name will be changed to Sorted Group Holdings. The pre-consolidation share price recovered 35.7% to 0.19p – the placing price is the pre-consolidation equivalent of 0.14p.
Eyewear manufacturer Inspecs (SPEC) says the improvement in profit in 2023 was not as great as expected because of weak December trading. EBITDA is likely to rise from £15.5m to £18m, whereas £20m was the consensus forecast. Revenues were flat. Net debt was £24.3m. The results will be published on 17 April. A Norwegian distributor has been acquired and the new Vietnam factory opens in the first half of 2024.
Symphony Environmental Technologies (SYM) has failed to get the EU court to declare EU legislation invalid. This legislation relates to the d2w biodegradable technology, which is not included in the single-use plastic directive and the company says that this has hampered the take-up of the technology.
Respiration equipment supplier Inspiration Healthcare (IHC) had a poor fourth quarter and full year revenues will be £6m lower than expected at £37m, down from £41m the previous year. That will result in a full year loss. Net debt is higher than anticipated at £6.4m. There were contract delays for neonatal products. This business should happen in 2024-25 and a rebound to a pre-tax profit of £2.9m is forecast, although that is lower than the previous estimate of £4.7m.
Midlands-based property investor Real Estate Investors (RLE) has reduced net debt to £46.3m after property sales. Even so, NAV has fallen to 58.4p/share. There remains demand from buyers for smaller properties that are of no interest to institutions. Loan-to-value is currently a comfortable 31%. Executive pay is being cut by one-third.
Potash project developer Emmerson (EML) says the scoping study of the Khemisset potash project in Morocco has enhanced economic returns and reduced the environmental impact. This is based on a ground-breaking processing method, which reduces water consumption by 50%. It also increases the recovery rate. Post-tax NPV8 is increased by 120% to $2.2bn. Annual EBITDA could be $440m and all0in sustaining cost is $163/tonne. Project capex is $525m.
Education administration software and services provider Tribal Group (TRB) says 2023 revenues will be marginally ahead of expectations. Overall annual recurring revenues are 9% ahead at £54.5m. The dispute with Nanyang Technology University continues. Net debt was £7.2m at the end of 2023. Cost savings should help profit to improve. The 74p/share offer from Ellucian lapsed.
Transport management software provider Microlise (SAAS) did better than expected in 2023 and this has sparked upgrades for 2024. Full year revenues were 13% higher at £71.6m with annualised recurring revenues 11% ahead at £47.2m – churn rates are low. Pre-tax profit is estimated to have improved from £4.9m to £5.5m. In 2024, it could reach £6.7m. Microlise completed the acquisition of Enterprise Software Systems earlier this month.
Online gaming company B90 Holdings (B90) spent more on marketing than expected in 2023. Zeus has raised its estimated loss from €2.7m to €2.9m, but it has maintained its forecast 2024 pre-tax profit at €400,000.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LUCE) did better than expected in the fourth quarter. Underlying 2023 pre-tax profit should be between £23.5m and £24m, up from £22m in 2022. The repair and maintenance market is still relatively weak, but Luceco is in a good position to benefit from an upturn.
Shell company Associated British Engineering (ASBE) had net assets of £469,000 at the end of September 2023, including £433,000 of cash.
Pendragon (PDG) has completed the sale of its motor dealerships, and it is concentrating on its software business.
Andrew Hore
Quoted Micro 15 May 2023
AQUIS STOCK EXCHANGE
Third quarter revenues of National Milk Records (NMR) were 15% higher at £6.5m. The core milk testing revenues were 14% ahead, helped by price rises. Genomic testing revenues more than doubled. Milk prices have fallen, but they are still relatively high. Canaccord Genuity still expects a dip in 2023 pre-tax profit from £2.4m to £1.9m.
Watchstone Group (WTG) has been unsuccessful in its £63m claim against PricewaterhouseCoopers concerning a breach of confidentiality. It is considering an appeal.
TruSpine Technologies (TSP) admitted that it failed to inform shareholders that a loan announced in February included a fixed and floating charge over the company’s IP.
KR1 (KR1) has invested $500,000 into Web3 venture studio Code and State through a Simple Agreement for Future Equity.
Cadence Minerals (KDNC) investee company Evergreen Lithium, where it owns 15.8 million shares (8.74%), has identified significant and widespread lithium at the Kenny project. A further £1.86m worth of shares could be issued to Cadence Minerals.
Goodbody Health (GDBY) shareholders have agreed to the cancellation of the Aquis quotation on 16 May. The shares will then be traded on the JP Jenkins platform.
TAP Global Group (TAP) has appointed Kriya Patel as chief executive of its main subsidiary. He is an experienced executive of e-money and financial technology businesses. He will receive five million LTIP options, plus a further 10 million LTIP options which will vest when certain milestones are achieved.
Ananda Developments (ANA) says a study suggests that cannabidiol plus terpenes has a more positive effect on acne than cannabidiol on its own.
Mark Horrocks has taken a 5.8% stake in Semper Fortis Esports (SEMP), while Chris Akers increased its stake from 19.5% to 19.6%.
Trading in Yooma Wellness Inc (YOOM) shares has been suspended until account are filed and the cease trade order is revoked.
AIM
Power Metal Resources (POW) has spun-off its Nevada mining interests into Golden Metal Resources (GMET). Power Metal Resources has retained a 62.1% stake. There was £1.98m raised at 8.5p when the company joined AIM. Trading started at 8.75p and ended the first day at 8.125p. There were 1.12 million shares traded on the first day and a total of 488,000 shares in the following two days. The share price ended the week at 8.125p. There are four assets: three wholly owned plus an earn-in option over a fourth.
Purplebricks (PURP) says that the number of new instructions did not increase in the fourth quarter and that means revenues and EBITDA will be worse than expected in the year to April 2024. The company’s payment processor is withholding a portion of remittances and cash was £9.1m at the end of April 2023, compared with previous expectations of £15m. The formal sale process continues, and management says that it wants to conclude this as soon as possible so the future of the business is clarified. Strike Ltd has decided not to make an offer.
Online builders’ merchants CMO Group (CMO) increased like-for-like 2022 revenues by 2%, but the market remains tough. In 2022, revenues increased from £76.3m to £83.1m, helped by acquisitions. Gross margins held up at 19.9% as sales of higher margin products offset the decline at Total Tiles, where there were problems with pricing. Overheads were increased following flotation on AIM and that is why operating margin dived from 3.5% to 1.5%. There was a boost of around £200,000 to operating profit due to a reduction in deferred consideration for a past acquisition. Pre-exceptionals profit fell from £1.5m to £800,000. Overheads are being reduced. Employee numbers are 15% lower than the peak last year and delivery costs are being controlled.
A&E Television Network is cancelling its contract with video editing technology developer Blackbird (BIRD) at the end of June. Last year, this contract contributed less than 10% of 2022 revenues of £2.85m. Blackbird is growing its revenues, including from licensing, but this contract loss will hold back the overall rate of growth. Blackbird has £9m in cash, down from £10m at the end of 2022.
Fulcrum Metals (FMET) is ranking targets for its Big Bear property on the Schreiber-Hemlo project in Ontario. Additional mining claims have been acquired at Winston Lake, Ontario. Results from the magnetic surveying at Tocheri Lake, Ontario, should be available early in the third quarter.
Credit hire company Anexo (ANX) reported flat 2022 pre-tax profit of £23.9m even though housing disrepair work helping to improve revenues. There were additional costs for vehicle emissions litigation against VW, which has some way to go before it is settled. A decline in pre-tax profit to £18.1m is forecast for 2023 as new credit hire business is reduced. That should help to improve cash collection and reduce debt.
Marwyn Investment Management has decided not to invest in footwear retailer Unbound Group (UBG) because of concerns about current trading. Marwyn had planned to inject £10m into the business at a placing price of 10.5p. That was the same level as the withdrawn offer from WoolOvers Group. Unbound has admitted that trading has worsened in the first quarter of the current year. Cash flow has to be carefully managed and banking covenants may have to be waived. Additional funds will be required.
Mineral sands project developer Capital Metals (CMET) has signed a potential 100% offtake and investment agreement with LB Group, which is the largest manufacturer of titanium dioxide pigments and sponge. LB Group will fully fund the Eastern Minerals project in Sri Lanka up to the estimated cost of $81m in the preliminary economic assessment. After that the joint venture will fund additional costs on a 50/50 basis. The plan is to build up production to 1.65 million tonnes per annum. Most of the due diligence for the deal has already been done.
Coal miner Bens Creek (BEN) says shareholder MBU Capital has sold a 29.9% stake at 18p a share to Singapore-based Avani Resources, which trades raw materials for steel and power production.
Brazil-focused gold producer Serabi Gold (SRB) has signed a strategic exploration alliance with Vale, which will assess large scale copper projects on the Palito Complex. There are four phases during which Vale can earn up to 90% of the project. Serabi would have a put option to sell the other 19% for $10m and a 1.5% net smelter royalty. There will be an initial $5m investment in exploration.
MAIN MARKET
Packaging manufacturer and distributor Macfarlane Group (MACF) published an AGM statement Manufacturing revenues are 14% ahead in the first quarter and distribution revenues 4% higher. There are bank facilities to finance further expansion.
LED lighting and wiring accessories supplier Luceco (LUCE) says first quarter revenues were 5% lower. There is still some destocking in the current period. Lower freight costs will help margins. Finance director Will Hoy and related parties have been acquiring shares at up to 110p each.
Andrew Hore
Quoted Micro 13 March 2023
AQUIS STOCK EXCHANGE
Ananda Developments (ANA) is acquiring MRX Global, which has invented a method to formulate cannabis medicines, for £2.02m in shares at 0.3p each. The first formulation is MRX1, which will be used in two phase II randomised controlled trials to investigate the effectiveness of cannabidiol in chemotherapy induced peripheral neuropathy and in patients with endometriosis. These trials have £1.55m of grant funding. Directors of Ananda are shareholders in MRX, so the deal requires shareholder approval. These directors will a 3% royalty on net sales of any commercial products sold by MRX. Ananda has raised £326,000 through a subscription at 0.3p a share and there is a broker option that could lead to the issue of 33.3 million shares at the same price. Charles Morgan has converted convertible loan notes into 747.3 million shares at 0.3p each. Charles Morgan and Melissa Sturgess will own 53.8% of the company.
Altona Rare Earths (ANR) has raised £2m at 5p a share, which is more than the £1.25m it was initially seeking. This is part of the move to the standard list on 20 March. A maiden JORC compliant mineral resource estimate and a scoping study for the Monte Muambe rare earths project in Mozambique. Altona is increasing its stake in the project from 20% to 51%.
Vulcan Industries (LON: VULC) is acquiring Forepower Lincoln (250) Ltd, which has a 240MW lithium-ion battery storage project, for £2.6m in shares at 1p each. This means that Britt Foreman of Forepower Lincoln (250) Ltd has a 29.9% stake in Vulcan. The two companies have been working together for the past year and Vulcan can help to raise the finance for the project. There are plans to raise more cash to settle liabilities of £250,000 and continue to develop the project.
Invinity Energy Systems (IES) has sold a 220KWh VS3 flow battery to Dawsongroup, following a sale earlier in the year. STS Group and project partner Ideona have been appointed to deploy Invinity Energy batteries in Hungary, primarily for co-located solar and grid support projects.
Hot Rocks Investments (HRIP) published 2021-22 figures and interim figures to September 2022 and trading in the shares was restored. Net assets are £526,000. On 3 March, cash was £70,000. Optiva has been appointed as corporate adviser.
CBD products supplier Yooma Wellness Inc (YOOM) continues to restructure its operations, but it is still trying to find a way of moving the business forward. Following the exit from many businesses, the remaining businesses are in Europe. Yooma Wellness may have to sell other businesses if additional funds are not secured.
EPE Special Opportunities (EO.P) had an NAV of 334p a share at the end of January, which was a 27% decline. The decline in the Luceco (LUCE) share price was a major factor even though this stake has been reduced in recent years. Rayware was another poor performer. Quoted shell company Epic Acquisition Corp is reviewing acquisitions. An investment in dog snacks company Denzel’s was completed in October. Investments in Atlantic Credit Opportunities Fund and Prelude Structured Alternatives Master Fund.
Guanajuato Silver Company Ltd (GSVR) says a US institutional investor has acquired 24 million shares from Great Panther Mining and its other shares were bought by other investors.
Rogue Baron (SHNJ) says Shinju premium Japanese whisky won a gold medal at the 2023 LA Invitational Wine and Spirits Challenge.
Pioneer Media (PNER) has left the Aquis Stock Exchange.
Marula Mining (MARU) has appointed Peterhouse as broker, replacing OvalX.
Music artists and events company All Things Considered (ATC) won the agent of the year award at the International Live Music Conference Gala Dinner.
Begbies Traynor has been appointed administrator to Love Hemp.
AIM
A positive trading statement by NWF (NWF) has led to a forecast upgrade for 2022-23. Peel Hunt increased its pre-tax profit forecast by 42% to £17.5m, compared with £20.9m last year thanks to a bumper year for fuel distribution. The expected downturn in fuels profitability has not been as sharp as previously thought and the food distribution and feeds divisions are also doing better than expected. Net cash of £5.5m is anticipated at the end of May 2023 and there are borrowing facilities of £65m. This leaves plenty of scope for further add-on acquisitions of fuel businesses.
Franchise Brands (FRAN) reported better than expected 2022 pre-tax profit up from £6.5m and £12.8m and it plans to sell its B2C franchise businesses. The Filta business made a 10-month contribution last year. Net cash was £8m at the end of 2022 and the B2C businesses, which could be sold separately or in one disposal, will generate more cash. The next acquisition will be in the B2B area, and it is likely to be significant.
Gelion (GELN) is acquiring Johnson Matthey’s lithium sulfur and silicon anode patent portfolio for £4.25m. This will help Gelion to increase gravimetric energy density for its batteries and enable faster commercialisation of lithium sulfur technology. Gelion plans to sell the silicon anode patents and could receive around £1.25m for them.
Data analysis technology provider WANdisco (WAND) was considering a US listing, but it has discovered accounting problems leading to a suspension of share trading.
Steel structures supplier Billington (BILN) sparked a forecast upgrade with its trading statement. Not only were 2022 profit and cash better than expected, 2023 momentum is ahead of estimates. The 2022 pre-tax profit has been upgraded from £5.3m to £5.8m, while the 2023 figure is increased by £1m to £8m. The 2022 dividend is expected to be 15p a share.
In The Style (ITS) has completed a strategic review and is proposing the sale of its operating business for £1.2m and the cancellation of the AIM quotation. The online retailer is losing money and running out of cash. The purchaser is Baaj Capital, which has other fashion-related investments, including Officers Club. Chief executive and founder Adam Frisby will continue to run the business and take a stake. The company will change its name to Itsum.
Aferian (AFRN) says customer destocking of streaming devices has hit sales and they will be significantly lower than expected for this part of the business. Streaming video services provider 24i continues to grow. There should still be a positive EBITDA this year. The annualised cost base is being reduced by $5m. Annual results to November 2022 will be delayed while discussions with banks continue over future covenant compliance. At the end of 2021, Aferian secured a $50m loan facility from three banks, including Silicon Valley Bank, which lasts until 23 December 2024. BLOE
Gold explorer Panthera Resources (PAT) has entered into a conditional arbitration funding agreement with a subsidiary of Litigation Capital Management (LIT) for the damages claim against the Republic of India for breaches of its obligations under the Australia-India bilateral investment treaty. Up to $10.5m will be provided to cover the costs of the claim.
Amur Minerals (AMC) has completed the sale of the AO Kun-Manie project in Russia to Bering Metals. The $35m consideration should be received soon. A 1.8p a share dividend is planned, and Amur Minerals will become a cash shell.
Purplebricks (PURP) has received approaches for the acquisition of the company, or its businesses and the ongoing strategic review has been widened to include a formal sale process.
MAIN MARKET
Networking and biomedical company BATM (BVC) reported a dip in full year revenues from $132.8m to $116.1m, partly due to a slump in Covid-related diagnostics income. Operating profit slumped from $11.3m to $3.7m. This was slightly better than expected. The networking and cyber division made a lower loss in 2022. There should be a recovery in revenues and profit this year. Moti Nagar has become chief executive.
Lookers (LOOK) has acquired vehicle hire and brokerage business Fourways Vehicle Solutions, which had revenues of £3.8m last year. This business could provide Lookers own rental requirements at lower cost.
Bluebird Merchant Ventures (BMV) has raised £1.22m at 2p a share to finance proof-of-concept funding at the Kochang gold and silver mine in South Korea. That is the same price as the previous placing. Production could eventually reach 5,000 ounces per annum. SI Capital has been appointed broker.
Andrew Hore
Quoted Micro 13 February 2023
AQUIS STOCK EXCHANGE
Hemp and cannabinoid products supplier Yooma Wellness (YOOM) is restructuring its business due to the depressed market conditions. Unprofitable activities have been wound down and management is still trying to come up with a new strategy. The 2021 Vertex acquisition is being handed back to the sellers and $1.2m in receivables has been assigned to them. The subsidiary in France is filing for a bankruptcy procedure. Yooma Wellness requires more cash and other operations may need to be sold. If not, then there could be insolvency proceedings.
Love Hemp (LIFE) has appointed administrators. Secured creditors have issued a notice of default requiring repayment of the £1.92m debt facility. Sales have slumped and a dispute with former managing director Philip Small has not helped.
Walls and Futures REIT (WAFR) is holding a general meeting on 23 February so that strategic investor Vengrove can raise cash for the company through a share issue. The number of shares in issue will be ten times as many as currently in issue. This will help Walls and Futures REIT scale up. Vengrove SI-REIT Advisors will become manager of the portfolio of assets. Pax Homes will be sold to Joseph McTaggart, so the group will no longer be a developer. Investments will be made in affordable rental housing, education property, service stations and car parks and community buildings. A portfolio of assets has been identified. The company’s name will be changed to Social Infrastructure REIT.
Music artist management and services provider All Things Considered (ATC) is estimated to have generated revenues of £11m in 2022 and the loss should be slashed from £2.7m to £300,000. Increased touring by music artists helped the business to recover. The company could breakeven in 2023.
Emissions reducing fuel ingredients supplier SulNOx Group (SNOX) finance director Steven Cowin has given notice and will leave the board at the end of March 2023. Four directors have option agreements with 6% shareholder RemNOx Ltd, which would enable it to acquire a total of 24.08 million shares at 30p each between 6 February and 28 February. That would mean that RemNOx would own 29.9% of SulNOx.
EPE Special Opportunities Ltd (EO.P) had cash of £24.5m at the end of January 2023. NAV was 334p a share, down from 456p a share. The share price recovered 5.71% to 185p. The Luceco (LUCE) share price decline was part of the reason. The company bought back 5.4% of its share capital at an average price of 139p/share. A £2m investment was made in premium dog snacks maker Denzel’s Ltd.
There are further delays in the provision of the £200,000 bridge loan to TruSpine Technologies (LON: TSP).
Newbury Racecourse (NYR) is raising its prize money by 16% to £6.06m in the 2023 season. Chairman Dominic Burke bought 6,250 shares at 815p each, taking his stake to 6.42%.
Res Privata NV took a 3.83% stake in NFT Investments (NFT).
Oberon Investments (OBE) appointed Paul Sheehan to its investment management team.
Greencare Capital has changed its name to MaxRets Ventures (MAX).
Marula Mining (MARU) appointed PWC Kenya as advisor to its East Africa activities.
AIM
Managed IT and networking services provider AdEPT Technology (ADT) is being acquired by a private equity backed Wavenet, which also provides telecom services. The 201p a share bid is a 75% premium to the previous market price it is still well below past levels. However, shareholders will not get the 2.5p a share interim dividend. The bid values AdEPT Technology at £50.3m.
Hardide (HDD) revenues grew 39% to £5m with the prospect of another sharp increase this year. The advanced coatings company continues to broaden its sector and customer base in areas such as renewable energy. Hardide is expected to continue to be loss making but the cash outflow will reduce. There is enough cash following the sale and leaseback of the US facility for the immediate requirements of Hardide.
Communications sub-systems manufacturer Filtronic (FTC) has been hit by component shortages that held back progress in the first half and this will continue in the second half. The order book is worth £17m, which is more than the 2022-23 forecast revenues of £16.5m. A small pre-tax profit is expected for the full year and there should be a sharp recovery in profit as supply problems ease next year.
Alumasc (ALU) interim revenues were 5% ahead at £45 million, pre-tax profit fell 11% to £5.6 million. The corresponding period included high margin Chap Lap Kok airport project work for the water management division and the phasing of projects hit the latest figures. The figures exclude the loss making Levolux business, which has been sold. Management indicated its confidence in the future with the 1.5% increase in the interim dividend to 3.4p a share. The second half will be stronger than the first half, but pre-tax profit is expected to decline from £12.7m to £11.3m.
Songtradr Inc launched an agreed bid for music streaming technology developer 7digital Group (7DIG) and the 0.695p a share offer values the company at £19.4m. The share has not been at this level since September 2021. Songtradr is a music licensing company with a platform and technology that connects music rights holders to brands and content creators.
Clinical communications technology developer Feedback (FDBK) revenues are still modest, but they increased by 222% to £576,000. The £450,000 contract with a Sussex community diagnostic centre made a contribution to these revenues and is up for renewal. The new contract should be worth much more when it is renewed. This pilot project will help to show other potential clients that the technology works. Other NHS trusts are showing interest in the company’s services. There was cash of £9.23m at the end of November 2022, so Feedback can finance further development and cover losses.
WH Ireland cut its forecast for SaaS-based retail software provider itim Group (ITIM) because contract delays mean that revenues will be slower coming through. Annualised recurring revenues are £13m, which is lower than expected. Revenues recognised for 2022 will be slightly below previous forecasts and that increases the loss by £200,000 to £1.1m. The 2023 loss is expected to be the same. Net cash is £3.9m. The share price slumped by 24.8% to 37.5p. The June 2021 placing was at 154p.
The share price of credit provider Morses Club (MCL) fell a further 52.6% to a new low of 0.21p ahead of the cancellation of the AIM quotation. Asset Match will provide a matched bargains facility for the shares.
esports company Gfinity (GFIN) requires more cash by the end of March so management wants to raise £1.5m via a share issue. That will finance a corporate restructuring, invest in the Athlos technology platform and help the company to move towards breakeven. Gfinity has a market capitalisation of £3.1m, so the proposed share issue will be highly dilutive.
MAIN MARKET
Used car finance and property bridging loans provider S&U (SUS) continues to do well despite weak consumer confidence. Group net receivables have risen from £370m to around £420m in the six months to January 2023. Full year figures will be published on 28 March. Full year pre-tax profit is forecast to decline from £47m – due to low bad debt provisions – to £41.2m. Net debt was £192m at the end of January 2023, compared with committed facilities of £210m. The second interim dividend is 38p a share. The full year dividend total is expected to be 132p a share.
Hamak Gold Ltd (HAMA) has commissioned a geophysical survey for the Ziatoyah gold prospect in Liberia. This will map the mineralised sulphide bearing metadolerite units where high grades of gold have been intersected.
Andrew Hore
Quoted Micro 23 January 2023
AQUIS STOCK EXCHANGE
Oberon Investments Group (OBE) is acquiring 63% of Logic Investments Ltd, which provides back office services to investment managers. Logic has funds under management and administration of more than £275m and Oberon Investments will merge its own back office operations with Logic. A placing raised £1.75m at 3.5p a share. Chairman Alex Hambro subscribed for 1.14 million of the shares, taking his stake to 1.64 million shares. The cash will be used to accelerate growth.
GP IT systems supplier DXS International (LON: DXSP) reported a 2% improvement in interim revenues to £1.65m, while the loss was £131,000 due to higher depreciation and operating costs. There was £399,000 in the bank at the end of October 2022. Management options can be exercised if annual turnover reaches £5m in the next three years. Hybridan forecasts revenues 2022-23 revenues of £3.61m with a pre-tax profit of £86,000.
Cooks Coffee Company (COOK) says UK sales were 41% higher in 2022, while sales in Ireland were 91% ahead. The focus is generating better returns from existing café sites, although there will be some new openings.
Healthy snacks supplier S-Ventures (SVEN) says full year revenues were £8.7m, but the inability to obtain ingredients hampered sales income. The operating loss is £2.6m. The revenues were one-fifth down on initial expectations for the year to September 2022. Supply problems have eased, and price rises have helped to offset higher costs.
Marula Mining (MARU) has appointed Geofields Tanzania to commence copper exploration at the Kinusi copper project, where Marula Mining owns a 49% interest, and £80,000 has been raised from a warrant exercise. Initial exploration results should be published in the second quarter of 2023.
Hydrogen Future Industries (HFI) is investing in hydrogen production facilities developer Tower Green. It has spent £100,000 in cash and shares on a 20% stake and has the right to invest a further £50,000 for another 10% stake. Tower has an agreement with Element 2 to supply hydrogen fuel to fleet operators. Hydrogen Future Industries has developed wind-based hydrogen production systems.
Tap Global (TAP) continues to rise following the previous week’s completion of its reversal into Quetzal Capital last week. There was £3.1m raised at 4.5p at the same time, even though the market price had not been that high since May last year. Chief executive David Carr acquired 190,000 shares at 4.1p each and finance director Anthony Quirke bought 135,135 shares at 4.4p each.
Newbury Racecourse (NYR) lost money on the Great Christmas Carnival and the company is likely to make a small profit in 2022. The other parts of the business traded in line with expectations.
Quantum Exponential (QBIT) had £2.48m in cash out of net assets of £4.85m at the end of October 2022. There was a cash outflow of £313,000 in the previous six months.
Guanajuato Silver Company Ltd (GSVR) has restarted processing at the Cata mill at the Valenciana mine. The initial processing rate is around 8,000 tonnes/month.
Invinity Energy Systems (IES) says that its VFB technology has passed phase 1 requirements for UK government’s LODES competition, and it is submitting the application for phase 2. The competition offers £11m of funding to the winner.
AQRU (AQRU) says that Accru Finance is raising the threshold for minimum account deposits on its app to $250,000. This will reduce assets on the app, but hardly affect revenues. There will also be further cost cutting.
Rogue Baron (SHNJ) sold 930 cases of Shinju whisky in the fourth quarter of 2022. Revenues were $120,000.
Gunsynd (GUN) has raised £194,000 from partial disposals of stakes in three companies. Gunsynd has invested £150,000 in Strategic Minerals Europe, the holding company of Aberdeen Minerals, which is exploring for nickel-copper-cobalt deposits in north east Scotland. Shares were acquired at 2.5p each and Gunsynd has a 2.7% stake.
Hydro Hotel Eastbourne (HYDP) is paying a dividend of 23p a share, up from 21p a share last year.
AIM
Pawnbroker Ramsdens Holdings (RFX) did much better than expected in the year to September 2022. Group revenues increased by 62% to £66.1m, while pre-tax profit jumped from £564,000 to £8.27m. Net cash is £8.84m. The total dividend is 9p a share. Earnings forecasts for 2022-23 were upgraded by 5% following a 6% upgrade in October.
Regional legal firm consolidator Knights Group Holdings (KGH) reported a 19% increase in interim revenues to £71.2m and underlying pre-tax profit was also 19% ahead at £9m. This was achieved in a flat market. Net debt was £35.6m at the end of October 2022. The interim dividend is 153p a share.
China-based Hainan Mining is funding the Bougouni lithium project that is wholly owned by Kodal Minerals (KOD). A $100m investment will be made into a joint venture providing Hainan Mining with a 51% stake. The work on the construction of the mine will be overseen by Kodal Minerals. Hainan Mining is also subscribing $17.75m for a 14.8% stake in Kodal Minerals and that money will be spent on other projects.
Mirriad Advertising (MIRI) is launching a strategic review and potentially putting itself up for sale. The board of the programmatic advertising business believes that Mirriad Advertising is undervalued even though it continues to make heavy losses. Revenues were £1.51m in 2022 and there was £11.3m in cash, which should last until the third quarter of 2023. The strategic review will consider how the business should be funded from then on. In-content advertising is set to grow significantly, but Mirriad Advertising has to have the funding to take advantage.
Legal services provider Gateley (GTLY) generated organic growth of 10% and improved profit by 12% in the first half. In the six months to October 2022, group revenues were 22% ahead at £76.1m, helped by contributions from the new patent activities, while pre-tax profit improved from £8.5m to £9.6m. The dividend has been raised by 10% to 3.3p a share.
Musical instruments retailer Gear4Music (G4M) grew revenues by 5% in the third quarter despite strikes and weak consumer spending. UK sales were flat, and the growth was in Europe. Gross margins declined. A full year pre-tax profit of £1.1m, down from £5m, is forecast.
Inland Homes (INL) chief executive Donagh O’Sullivan has resigned after little more than one month in the job.
Panther Securities (PNS) is paying a special interim dividend of 10p a share. The property investor says that it expects net assets to increase by £19m in 2022, mainly due to the removal of two derivatives liabilities relating to interest rates on debt. Loan-to-value is less than 40%. Debt refinancing discussions will begin later this year.
Online women’s fashion retailer In The Style (ITS) was hit in December by price cutting by rivals and difficulties in delivering orders. Revenues in the quarter to December 2022 fell by 22%. Full year revenues are expected to be £46m, which is not much more than the £44.7m generated in the year before flotation. The EBITDA outcome is likely to be a loss of between £4.25m and £4.75m. There was £3.2m in cash at the end of 2022. On 8 December, In The Style launched a strategic review and that continues.
Rockfire Resources (ROCK) has entered into a joint venture with Sunshine Gold for the Plateau gold deposit in Queensland. Sunshine Gold will fund all exploration for three years. Rockfire Resources will focus on the Molaoi zinc deposit in Greece.
Circle Property (CRC) intends to return at least £30m to shareholders by March 2023. Three-fifths of the portfolio has been sold in 14 months. At 220p, the shares are trading on a discount to NAV of around 18%.
Upgrades for Equals Group (EQLS) continue to push the share price higher. The forecasts had already been upgraded in December and earnings per share have been increased by a further 4% to 4.8p, up from 2.8p in 2021. There was £15m in the bank at the end of 2022.
Crimson Tide (TIDE) revenues were better than expected and that reduced the forecast loss. The mobile as a service technology developer is still on course to breakeven next year. Annualised recurring revenues are £5.8m, which is more than generated in 2022. The US provides additional potential.
Shanta Gold (SHG) produced 65,209 ounces of gold at an all-in sustaining cost of $1,270 at the New Luika gold mine in Tasmania, which is just below guidance. Capital investment means that it could produce 66,000-72,000 ounces of gold at an all-in costs of $1,200-$1,300/ounce.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LUCE) as 2022 revenues and profit are at the upper end of guidance. Strong cash flow reduced borrowings with net debt one-third lower than expected at £24m. The finance director is leaving and being replaced with non-exec Will Hoy.
Medica Group (MGP) revenues and profit for 2022 should be in line with expectations. Improved radiologist capacity helped revenues improve from £61.9m to £77m, while pre-tax profit is set to improve from £7.4m to £13m. Acquisition opportunities are being evaluated.
Andrew Hore
Quoted Micro 24 October 2022
AQUIS STOCK EXCHANGE
Chapel Down Group (CDGP) had a bumper grape crop in terms of quality and yield. Chapel Down has 750 acres of vines and the harvest was more than 2,000 tonnes, up from 1,400 tonnes last year, with a particularly good crop for sparkling wines. The English sparkling wine market grew by 29% in 2021More than two million bottles of many types of wine can be made from the harvest. A further 38 acres of vines were planted this year with 118 acres planned. More land is being sought. Management wants to double the size of the business by 2026.
Property investor Ace Liberty & Stone (ALSP) launched an open offer to raise £4.56m at 25p a share, which is a big discount to the market price. The share price fell 25.8% to 47.5p. The open offer closes on 14 November and enables existing shareholders to finance the strategy to buy additional properties. Management believes that economic uncertainty will provide opportunities to acquire high yielding properties.
Ananda Developments (ANA) has changed the acquisition terms for the 50% not owned in DJT Plants. The purchase price has been cut from £7.3m to £3.2m, which is payable in shares at 0.925p a share giving the seller Anglia Salads 29.9% of the enlarged share capital. That is double the current share price. The chairman’s £2.3m loan to Ananda will be swapped for convertible loan notes and warrants. DJT is analysing its 2022 field trial crops to determine the amounts of cannabinoids and terpenes contained in the cannabis flowers. This will help the company to decide which cultivars to use. There are international growers interested in purchasing seeds from DJT.
Love Hemp (LIFE) says it will sell all LH Botanicals products and LH Botanicals Ltd, which is owned by Love Hemp chief executive Tony Calamita, does not sell these products and has never traded. An application has been filed to strike the company off the company register.
Hydrogen Utopia International (HUI) has secured a convertible loan facility with Conrad Griffiths, owner of 9.45% of the company. The €650,000 facility is interest free until the beginning of 2023 when the annual interest charge is 5%. The repayment date is 31 December 2025. The conversion price is 20p – based on the exchange rate of €1.14/£.
Invinity Energy Systems (IES) has secured the sales contract for a 10MWh VS3 flow battery system for a solar microgrid in southern California.
Goodbody Health Ltd (GDBY) has signed an agreement with Allied Pharmacies that will add 17 clinics to its network offering diagnostic testing and adds services such as ear wax micro suction.
SulNOx Group (SNOX) has signed up South Africa-based bus company Lowveld Bus Service, which will use SulNOxEco fuel conditioner in its fleet of more than 170 buses.
VVV Resources (LON: VVV) has appointed Jim Williams as an executive director. He was previously a chief executive of AIM-quoted Arian Silver Corporation, which is now known as Alien Metals (UFO). David Rigoll and Simon Clarke have left the board.
Chris Akers has upped his stake in Quetzal Capital (QTZ) from 22% to 23.4%. Investee company Tap Global has added GBPT stablecoin to its cryptocurrency trading platform.
Harry Hyman has increased his stake in Oberon Investments Group (OBE) from 3.08% to 4.15%. Phoenix Asset Management Partners has taken a 16.5% stake in Silverwood Brands (SLWD).
AIM
Semiconductors designer EnSilica (ENSI) generated more than 50% of its revenues from its design and supply division for the first time last year. Revenues increased from £8.61m to £15.3m with design and supply’s contribution jumping from £2.82m to £8.02m. This is down to contracts starting to move from the design to supply stage. A loss was turned into a pre-exceptional profit of £165,000. That is before R&D tax credits of £683,000. EnSilica capitalised £2.2m of development spending last year.
Latest new AIM admission Sondrel (SND) raised £20m at 55p a share and the price rose to 58p in early dealings. The semiconductor designer will spend the money on employing more engineers and accelerate sales. There are more than £300m of revenue opportunities for designing semiconductors. If selected, Sondrel can expect to supply the semiconductor for five years plus. The medium-term target revenues are in excess of £100m.
Revolution Bars (RBG) is acquiring Peach Pubs for £16.5m. Peach Pubs has 21 food-led pubs in the south of England and the Midlands. There should be £1.5m of cost savings from combining the businesses at a minimal cost, but they will not be fully achieved until 2024-25. finnCap has adjusted its 2022-23 forecast for Revolution Bars due to higher energy costs, so the earnings estimate has been reduced by 69% to 0.5p.
Affimer technology developer Avacta (AVCT) is acquiring in vitro diagnostics distributor Launch Diagnostics for £24m, plus up to £13m in performance related earn outs. This acquisition is part of the strategy to build up a European distribution business. Kent-based Launch Diagnostics is a profitable business that supplies diagnostic reagents and instrumentation for pathology applications. A placing at 95p a share will raise £7m and a three-for-365 open offer could raise up to £2m more. A £55m convertible bond issued at 95% of par could raise £52.5m and it is convertible at a 25% premium to the 95p a share placing price.
Gear4Music (G4M) edged up interim revenues by 2% with the growth coming from Europe and the rest of the world. The musical instruments retailer is upgrading its websites and trading is improving, although gross margins are lower.
Tatton Asset Management (TAM) generated inflows of £907m in the six months to September 2022. Assets under management have reached £11.3bn, with a further £1bn of assets under influence. There was an 11% improvement in earnings to 9.8p a share and the interim dividend 10% ahead at 4.4p a share. Inflows are expected to slow and full year expectations have been trimmed, but earnings should improve from 18.6p a share to 19.8p a share.
Logistics Development Group (LDG) has raised its stake in cakes maker Finsbury Food (FIF) from 4.4% to 6.77%. A further £4.17 has been invested at an average of 81p a share. The previous investment was at 69.5p a share, which was just above the low for 2022. Richard Griffiths increased his stake in Logistics Development Group from 7.04% to 8.71%. Logistics Development Group should have received more than £31m for its stake in CareTech.
Learning and development products and services provider Mind Gym (MIND) generated interim revenues 11% ahead at £26.8m with the majority coming from the US. Net cash is £4.5m. The interims will be published on 2 December. A full year pre-tax profit of £2.87m is forecast.
Advanced Oncotherapy (AVO) has raised £6m at 25p a share from Odey Asset Management. The subscription was at a 12% premium to the market price.
Mattress supplier eve Sleep (EVE) has appointed an administrator.
Anthony Laiker has left the Vela Technologies (VELA) board and sold his 6% stake. He was reappointed to the board in July having been a director between 2013 and 2020.
MAIN MARKET
Kitchenware retailer ProCook Group (PROC) says revenues continued to decline in the second quarter, but the rate slowed and there has been growth in early October. Freight costs are falling offsetting the change in exchange rates. Fackelmann Gmbh owns a 9% stake.
LED lighting and wiring accessories supplier Luceco (LUCE) says destocking has happened faster than expected, so the 2022 profit outcome will be lower than anticipated. Underlying operating profit is expected to be £20m-£22m in 2022. Net debt was £46.5m at the end of September 2022.
Carclo (CAR) says interim sales were ahead of the same period last year and slightly better than expectations. However, operating profit is slightly lower than previously. The life sciences division has grown even though two product launches were delayed. There was also increased demand from the aerospace sector.
Motor dealer Lookers (LOOK) outperformed the UK car market in the third quarter and pre-tax guidance has been increased to no less than £75m. Last year’s pre-tax profit was £90.7m, but that benefited from government assistance and a strong used vehicle market. However, a lack of available new cars to sell is holding back the performance of all motor dealers.
An administrator has been appointed to Toople (TOOP) after it failed to secure financing for a proposed acquisition.
Andrew Hore
Quoted Micro 12 September 2022
AQUIS STOCK EXCHANGE
Samarkand (SMK) has been hit by a large cash outflow, which means that the China-focused e-commerce technology and brands retailer requires a cash injection of up to £3m via an open offer at 55p a share. Covid lockdowns in China have delayed progress and hampered the ability to supply products. In the year to March 2022, revenues fell from £20.6m to £16.6m, although if one-off revenues in the previous period are excluded then there was a 12% improvement. There was an initial contribution from the Zita West supplements brand acquired last year. Nomad software platform revenues were 18% ahead at £7.5m.
Aquis Stock Exchange owner Aquis Exchange (AQX), which is also quoted on AIM, has relaunched the EU dark pool trading operation it acquired from UBS as the Aquis Matching Pool.
BWA Group (BWAP) has been granted a new licence for Dehane 2 at the Dehane heavy mineral sands project in Cameroon. Results from granulometric test work at the Nkoteng heavy mineral sands show rutile is the most abundant mineral.
More news about the investee companies of Evrima (EVA) this week. Eastport Ventures Inc, where it owns 6.85%, has entered a letter of intent with TSX-V listed Auston Capital concerning a possible merger.
Marula Mining (LON: MARU) says that initial test work at the Blesberg lithium and tantalum project in South Africa shows an average lithium grade of 6.1%. Tantalum was also identified.
SulNOx Group (SNOX) has signed a memorandum of understanding with Rominserv, a subsidiary of Rompetrol. The Romanian company is considering using SulNOx products in its refinery processes.
MiLOC Group Ltd (ML.P) has received a civil judgement against subsidiary Star C, which has to return £166,000 to one of its distributors.
Ananda Developments (ANA) subsidiary DJT Plants is working on self-crossing cannabis strains to create stable strains. So far, it appears that self-pollination of cannabis plants can be achieved. Field trials for growing cannabis have been successful.
Coinsilium Group Ltd (COIN) says its advisory clients Blvck Paris and Metalinq Labs are joining together to launch a collection of wearables. The Metalinq technology can be used to convert 2D designs into multi-metaverse 3D designs.
Wishbone Gold (WSBN) raised £2.375m at 10.35p a share and the share price fell below that level. This cash will finance expansion of exploration activities in Australia. Significant copper and gold grades have been found at the Halo project in Queensland. There are also zones of high gold silver and coper at Grassy Oaky. A high-resolution gravity survey is commencing at the Red Setter gold copper project.
EPE Special Opportunities Ltd (ESO) reported a decline in NAV to 231.9p a share by the end of August 2022.
AIM
Online musical instruments supplier Gear4Music (G4M) warned that trading has been tough in recent months. The first quarter to June 2022 was encouraging but spending in July and August was weaker than expected even if the hot weather is taken into account. September is showing signs of improvement. Guidance has been lowered with pre-tax profit expected to slump from £5m to £1.1m with a possible recovery to £3.3m next year.
Online competitions organiser Best of the Best (BOTB) is linking up with Globe Invest Ltd, the family office of Teddy Sagi the founder of gaming technology firm Playtech (PTEC), to grow international income. Globe Invest will also buy a 29.9% stake from the directors and related parties at 400p a share. They intend to enter a licensing and distribution agreement and a marketing collaboration agreement. Globe Invest will licence the Best of the Best business model outside of the UK.
Cosmetics supplier Warpaint London (W7L) says trading is ahead of market expectations with sales of at least £61m and underlying pre-tax profit of more than £9m. The previous pre-tax profit forecast was £8.23m. There could be additional gains from foreign exchange.
Franchised lettings and estate agency business Belvoir Group (BLV) did well in the first half considering the ending of property buyer incentives. In the six months to June 2022, revenues were 12% higher at £15.4m. There was a 1% improvement in the underlying business with the rest of the growth coming from acquisitions. Underlying pre-tax profit fell from £4.9m to £4.2m as the cost base returned to normal. Net debt is £2.5m and the interim dividend is maintained at 4p a share.
Premium bricks maker Michelmersh Brick (MBH) increased interim revenues by 14% to £34m, while pre-tax profit was 9% ahead at £6.1m. Production efficiencies helped to offset some of the cost increases. A price rise has been pushed through in July. Overall brick stocks remain at low levels. Management has secured 90% of energy costs for this year and 50% for 2023. Net cash was £9.9m at the end of June 2022. The interim dividend is 13% higher at 1.3p a share.
Sylvania Platinum (SLP) announced a doubled final dividend of 8p a share alongside its results for the year to June 2022. There has already been a special dividend of 2.25p a share and a $7.1m share buyback. Production declined and selling prices for platinum group metals were lower in the year to June 2022. Even so, net profit was $56.2m and Sylvania Platinum has been able to finance the cash distributions and plough money back into development. The benefits of that investment will show through in 2023-24. There is still $121m of cash in the balance sheet, although the dividend will reduce that.
Avacta Group (AVCT) says the US Food and Drug Administration (FDA) has granted orphan drug designation for the lead preICISIONdrug soft tissue sarcoma treatment candidate, AVA6000. This provides tax credits and other incentives, plus seven years of market exclusivity in the US, if the drug is improved. There is an ongoing phase I clinical trial.
Shares in AIM shell Advance Energy (ADV) were suspended on Friday after the announcement of non-binding heads of agreement have been signed for the acquisition of a European oil and gas company.
VSA published an initiation note on Prospex Energy (PXEN) and the broker believes there is upside from the development of the onshore Selva gas project in Italy, where Prospex owns 37%. First production should be in the middle of next year. Cash is being generated from the El Romeral gas to power project in Spain.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LUCE) interim revenues dipped by 2% to £106.4m, but they are still higher than in 2019. There was a sharp drop in pre-tax profit from £16.6m to £4.6m. The interim dividend has been reduced from 2.6p a share to 1.6p a share. DIY demand has fallen back and there was also destocking. The EV business should make a greater contribution in the second half.
Critical Metals (CTRM) has published the prospectus for the proposed acquisition of a 57% shareholding in Madini Occidental, which owns 70% of the Molulu copper cobalt project in the Democratic Republic of Congo. The acquisition is expected to complete on 12 September.
Darktrace (DARK) has ended bid talks. Last year, revenues grew 46% to $415.5m and the AI company moved into profit.
Andrew Hore
Quoted Micro 9 May 2022
AQUIS STOCK EXCHANGE
In 2021, Newbury Racecourse (NYR) is paying a special dividend of 89.6p a share. The £3m payment comes after the receipt of the final £10.7m from the sale of housing development land. Newbury Racecourse increased turnover by 75% to £14.8m as racing returned to the course. There is still potential for further recovery this year. Attendances increased from 12,000 to 105,000. The hotel reopened in January 2022. There was a swing from £2.17m loss to an underlying pre-tax profit of £333,000.
Quantum Exponential (QBIT) is investing £406,000 in Aegiq Ltd, a photonics company using quantum technologies in the cybersecurity market. That gives it a 4.06% stake. Helium Special Situations has reduced its stake from 4.57% to 1.52%.
Goodbody Health Inc (GDBY) reported better than expected revenues for 2021. The CBD products and testing company made an underlying loss of £900,000 on revenues of £17.1m. Arden forecasts a £5.1m profit this year.
VSA Capital (VSA) has received a settlement of outstanding fees of £153,000 from client Anglo African Agriculture in the form of 3.82 million shares. This gives VSA a 15.3% stake plus warrants and convertible loan notes.
Gunsynd (GUN) has terminated the disposal of Oyster Oil and Gas to Sajawin.
Clarify Pharma (PSYC) had net cash of £1.3m at the end of April 2022. Investment opportunities in the psychedelics market are being assessed.
Apollon Formularies (APOL) has acquired intellectual property and patents from Aion Therapeutic for £96,000 and 4.35 million shares. It will also pay a royalty fee of 4% on net revenues from products based on these patents. The patents cover potential cancer treatments.
ChallengerX (CXS) has appointed Olivia Edwards as chief executive and Nicholas Lyth as finance director.
Phase 1 assay results from the Monte Muambe project held by Altona Rare Earths (ANR) show significant levels of rare earths.
Coinsilium (COIN) has been appointed as adviser to Silta Finance and entered into an agreement to purchase $75,000 of future SILTA tokens. Silta is building a technology to connect decentralised finance to infrastructure project developers.
Capital for Colleagues (CFCP) has sold its remaining stake in builder’s merchant Merkko Group for £378,000.
Rogue Baron (SHNJ) has received the first UK order for Shinju and Shinju 8-year old whisky.
S-Ventures (SVEN) chairman David Mitchell bought 57,959 shares at 32p each. Chris Akers has increased its stake in Quetzal Capital (QTZ) from 19.1% to 20.1%. John Mahtani reduced his stake from 5.71% to 3.83%.
AIM
Online retailer of building materials CMO Group (CMO) continues to grow on the back of a buoyant market as well as gaining market share. The online share of the sector remains relatively low. The second half growth was not as fast as in the first half. In 2021, revenues grew 46% to £76.3m. There is organic growth supplemented by acquisitions. CMO moved from loss to an underlying pre-tax profit of £1.4m. Net cash was £6m. Following the acquisition of JTM Plumbing Plumbingsuperstore.co.uk is being launched later this year. First quarter trading has continued to be strong with like-for-like growth of 3%.
Neonatal intensive care medical devices supplier Inspiration Healthcare (IHC) increased full year revenues from £37m to £41.1m. Acquisition contributions offset the one-off Covid ventilator revenues in the previous year. Pre-tax profit improved from £3.13m to £3.96m, although earnings fell 12% to 6.1p a share because of the additional shares issued for acquisitions. The company’s order book is strong.
In 2021, targeted digital advertising services provider Dianomi (DNM) revenues grew from £28.4m to £35.8m, even though Asia Pacific revenues fell from £1.72m to £1.18m due to the ASX website stopping having advertising content. Underlying pre-tax profit moved from £2m to £2.9m – share based payment charges and float costs led to a loss being reported – and it is expected to increase to £3.6m this year. The average spend of the top 100 advertisers increased 27% to £280,000 each. Net cash was £10.3m at the end of 2021.
In 2021, Intelligent Ultrasound (IUG) reported revenues 47% higher at £7.6m, mainly from ultrasound simulation products, while the cash outflow from operations was £2.3m. AI revenues remain modest, and it will take time for them to build up. Cenkos upgraded its 2022 revenues forecast from £9m to £10m, but the cash outflow will be similar.
Plastics and packaging supplier Coral Products (CRU) is using some of its cash pile to acquire Film & Foil Solutions, a supplier of flexible packaging film used for food, books, carpets and for cable tapes. The initial payment is £1.35m in cash, plus £750,000 in shares at 15.5p each. There is just over £900,000 that could be payable based on the settlement of a contract dispute and an insurance payment. The acquired business made an underlying profit of £541,000 in 2021.
Energy efficiency as a service provider eEnergy Group (EAAS) has been hit by contract delays. That means that 2021-22 EBITDA could be £3m and not £4.4m as previously expected. A new finance director is being appointed.
Green hydrogen production developer ATOME Energy (ATOM), which was spun out of President Energy (PPC) at the end of 2021, has secured a major 60MW power purchase agreement with ANDE, the national power supplier in Paraguay. Hydrogen production could commence in Paraguay in the first quarter of 2023.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LUCE) will report revenues around £15m lower than expected due to overstocking. This will knock £10m off operating profit. Price rises are offsetting the effect of inflation.
Castings (CGS) 2021-22 results will be slightly ahead of expectations. Demand for commercial vehicles remains strong, but there is still uncertainty about the ability produce heavy trucks.
Kendrick Resources (KEN) was formerly AIM-quoted BMR Group, which left AIM in August 2018 after problems with the progress of the Kabwe project in Zambia. Kendrick still has a 11% royalty interest in Kabwe. Kendrick Resources has acquired Northern X Finland and Northern X Scandinavian. In Finland, there is an exploration licence at the Koitelainen project and two licences at the Karhujupukka project. There are two projects in Sweden: the Airijoki project and the Central Sweden project. There is also an option over three projects in Norway.
Gresham Technologies (GHT) has secured a contract with an existing bank customer worth up to £6.3m over a period of five years. The company’s Clareti software will be used across the whole UK business of the bank.
Andrew Hore