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Quoted Micro 17 October 2022
AQUIS STOCK EXCHANGE
Invinity Energy Systems (IES) is having a good week. Early in the week it announced a sale of a a 0.8MWh Invinity VS3 flow battery system to Equans Belux and then it won a California Energy Commission project as part of a consortium developing a large solar-plus-storage microgrid. Invinity Energy Systems will provide a 10MWh vanadium flow battery system. Delivery is expected in 2023. There is also a new relationship with US Vanadium, which could lead to a joint venture.
Vulcan Industries (VULC) is acquiring Peregrine X, which has developed diagnostic technology and the initial market will be oil well-head analysis. There are also medical uses. The initial consideration will be £1m of zero-coupon convertible loan notes with a further four tranches of £1m depending on progress. The total number of loan notes would be converted int a 46.2% stake in the company. The seller will also receive 500 million warrants exercisable at 1p a share. They will also receive 70% of post-tax earnings generated by Peregrine up until 2,000 tests have been contracted and 200 delivered. There are currently no revenues. This deal marks a move away from the engineering sector.
British Honey Company (BHC) has launched a strategic review of the business and sources of finance. A sale of the company is an alternative. Management expects to publish its 2021 results and 2022 interims before the end of October. More cash is required for working capital by the end of November.
Consumer businesses operator Silverwood Brands (SLWD) has announced a loss of £300,000 for the period to August 2022. The UK consumer market is tough and Silverwood is trying to increase its sales overseas.
Semper Fortis Esprit (SEMP) has ended all its contracts with esports players, and it is seeking other ways to exploit the market.
Capital for Colleagues (CFCP) has sold its holding of A shares in Hire and Supplies Ltd for £970,000 and reinvested £1.21m in new ordinary shares, giving it a 20.8% stake.
Hydrogen Utopia International (HUI) has signed a memorandum of understanding with Poland-based Elkard in relation to a plastic waste processing plant producing energy. They will start looking for a suitable site and the two companies will share the costs.
Arbuthnot Banking Group (ARBB) has completed the sale of Arbuthnot Latham’s West End office. The offer was previously indicated as £60m. Chairman and chief executive Sir Henry Angest bought 25,000 shares at 820p each.
Igraine (KING) has bought a 10.2% stake in Oscillate (MUSH) and its executive director Stephen Winfield has joined the Oscillate board.
MiLOC Group Ltd (ML.P) has raised nearly £40,000 at 20p a share. BWA Holdings (BWAP) has been unable to raise up to £500,000 via share issue and it may have to sell assets or issue more loan notes. A holder of £516,000 of RentGuarrantor Holdings (RGG) loan notes has converted them into 312,495 shares, which is just short of 3% of the enlarged share capital.
EPE Special Opportunities Ltd (EO.P) had net assets of 242.3p a share at the end of September 2022.
Valereum (VLRM) has appointed First Sentinel Corporate Finance as corporate adviser.
AIM
Energy and water efficiency equipment provider Eneraqua Technologies (ETP) grew its interim revenues from a combination of organic growth and a contribution from recent acquisition Welltherm, which provides drilling services for heat pump installation. Revenues were 92% higher at £24.2m, while underlying pre-tax profit was £3m. Full year expectations are covered by contracted orders as are nearly three-quarters of next year’s forecast revenues. A full year pre-tax profit of £10.6m is forecast. There are plans to move into the consumer market, but that will not make a meaningful contribution until next year – although there will be £500,000 of marketing costs.
Drug developer Evgen (EVG) is partnering with Swiss biotech Stalicia for the potential use of SFX-01 for the treatment of autism spectrum disorder and other CNS disorders. This deal could generate up to $160.5m in milestone payments and double-digit royalties, although that is a long way away. The upfront payment is $500,000 with a further $500,000 once a volunteer study is completed in the first half of 2023. If the FDA approves an investigational new drug admission that will spark a $5m payment – possibly next year. Evgen is also undertaking an additional early-stage study for the treatment of glioblastoma using SFX-01.
Interior design and furnishings supplier Sanderson Design Group (SDG) improved its interim profit, but trading was weaker in August. In the six months to July 2022, revenues edged up by 0.7% to £57.9m, although that does reflect the ending of business in Russia. Underlying pre-tax profit improved from £5.6m to £6.3m, helped by additional high margin licence fee income. The interim dividend is maintained at 0.75p a share.
Faron Pharmaceuticals (FARN) completed a placing raising €8.4m at €1.85 each. The cash will be used for the acceleration of the bexmarilimab, which is an immunotherapy treatment for difficult-to-treat cancers, clinical development programme and manufacturing.
Data analysis software provider WANdisco (WAND) has generated bookings of $61.2m so far this year with the majority coming in the third quarter. This is already higher than expectations for the full year and there is more to come. There was $26.3m in the bank at the end of September 2022, helped by upfront cash payments on contracts. Losses continue, though.
Property lending platform operator Lendinvest (LINV) reported platform assets under management one-third higher at £2.4bn, but finnCap has downgraded its full year forecast. Interest rate volatility is hampering margins. Chief executive Rod Lockhart bought 27,111 shares at 67.5p each and the chief investment officer bought 60,000 shares at 63.75p each.
Coral Products (CRU) has acquired Ecodeck Grids, which supplies building and landscape products for driveways and shed bases. There is an initial payment of £3.35m in cash and shares, with up to £1.25m more potentially payable. The products use 100% recycled plastic.
Beeks Financial Cloud (BKS) reported an improvement in full year underlying pre-tax profit from £1.6m to £2.1m. It is forecast to increase to £3.2m this year.
Sierra Oncology Inc is returning the rights to SRA737, which was jointly developed by Sareum Holdings (SAR) and the Institute of Cancer Research, to the CRT Pioneer Fund.
Investment publisher Bonhill (BONH) has commenced a strategic review that could lead to the sale of the company or separate businesses. Trading remains difficult and shareholder Rockwood Strategic (RKW) is providing a £800,000 loan facility.
MAIN MARKET
OTAQ (OTAQ) is raising £2m via a placing at 4p a share, while a four-for-five open offer could raise up to £1.2m more. It is also moving from the standard list to the Access segment of the Aquis Stock Exchange. There is also a broker option that could raise up to £400,000 if there is enough demand. In order to raise the cash, the nominal value of the shares is being reduced from 15p to 1p. Every four new shares taken up will come with a warrant exercisable at 12p. The fundraising is dependent on shareholders agreeing the move to Aquis, which is planned for 9 November. In aquaculture, OTAQ has developed sonar technology that scans shrimps, live plankton analysis systems and water quality monitoring software. The geotracking operations have developed a rail personnel and asset safety and sports trackers.
Raj Unnikandeth is stepping down as a director of Zamaz (ZAMZ) six weeks after it floated. Zamaz believes that its technology platform can help to efficiently build brands via e-commerce. Earlier in the week, Zamaz acquired 70% of Italy-based food and wine retailer Eccellenze through its existing food platform subsidiary Bella Dispensa. This follows the purchase of Italian meat products supplier Ecocarni.
HeiQ (HEIQ) has filed a complaint in the US against ICP Industrial Inc for breaching exclusive agreement terms. The agreement relates to the use of HeiQ Viroblock in printing processes. ICP has failed to pay royalties or minimum fee payments, as well as not providing timely reports.
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 31 January 2022
AQUIS STOCK EXCHANGE
NFT Investments (NFT) plans to acquire Pluto Digital Assets. NFT Investments has a non-binding letter of intent relating to the acquisition, which is valued at £96m – based on the issue of 2.4 billion NFT Investments shares at a nominal valuation of 4p each. That is equivalent to 9.3p a share. However, NFT Investments shares have been suspended at 2.475p (2.35p/2.6p). NFT Investments is lending £5m to Pluto, which is a crypto technology and operations company involved in decentralised finance and NFTs.
SuperSeed Capital Ltd (WWW) is set to join Aquis on 31 January, having raised £2m at 100p a share. SuperSeed is a Guernsey-based closed-ended collective investment scheme operating a fund of funds. Investments will primarily be in unquoted funds managed by SuperSeed Ventures. The initial funds will invest as a limited partner of SuperSeed Ventures II LP.
Capital for Colleagues (CFCP) has redeemed its A shares in investee company Bright Ascension and received the book value of £250,000. It still owns ordinary shares in the space software technology company worth £1.75m. Capital for Colleagues NAV was 70.9p a share.
Valereum (VLRM) has accelerated its purchase of the Gibraltar Stock Exchange. An option will be exercised to take the stake from 10% to 50%. Once change of control is allowed, Valereum will take its stake to 90%. The plan is to make the stock exchange one of the world’s first regulated integrated fiat and digital exchanges.
Samarkand Group (SMK) has become a FedEx alliance partner. FedEx clients will be able to use Samarkand’s Nomad ecommerce platform.
MiLOC Group (ML.P) says that one of its subsidiaries has received a claim for £202,000 that it says it is owed.
AIM
Hargreaves Services (HSP) reported a jump in profit thanks to a large contribution from German joint venture HRMS. In the six months to November 2021, revenues fell from £92m to £76.1m partly due to the past sale of the coal stocks to HRMS, although operating profit improved from £868,000 to £1.06m. Pre-tax profit was £10.4m, up from £1.08m, which includes a share of HRMS profit of £9.27m, up from £944,000. The interim dividend has been raised from 2.7p a share to 2.8p a share. Net assets are 462p a share.
Compliance and energy saving services provider Sureserve (SUR) is not paying a dividend even though net cash is £16.5m. The cash will be invested in acquisitions to grow the business. In the year to September 2021, revenues increased by one-quarter to £244m, while pre-tax profit was 77% higher at £13.8m. There was an improved profit contribution from compliance services, particularly the gas business, and energy services contribution recovered.
Acoustic and thermal insulation material manufacturer Autins Group (AUTG) continues to be hampered by electronic component shortages that have slowed car production. Demand from the automotive sector will return when these components are available. In 2020-21, revenues increased 9% to £23.4m. That is better than it appears because there was a £1m plus reduction in short-term PPE revenues. The main growth came in flooring sales.
Real Estate Investors (RLE) says occupancy is 85.75% and this could move to over 86% if expected lettings are secured. The total dividend for 2021 will be at least 3p a share, which is a yield of more than 7.5%.
Digital advertising services provider Dianomi (DNM) grew revenues by more than one-quarter in 2021. Growth is being supplemented by newer elements such as video and lifestyle. Underlying EBITDA will be slightly ahead of expectations and cash increased to £10.3m.
Velocity Composites (VEL) reported a slump in revenues in the year to October 2021, but the supplier of engineered kits for the aerospace sector is experiencing a recovery in demand. Airbus is likely to ramp up production and this could help revenues improve from £9.8m to £11.7m. It will still be loss making at that level. Longer-term, Velocity Composites has its sights on moving into the US aerospace model using the same model as in the UK.
Redx Pharma (REDX) is set to have three phase II clinical trials in process later in 2022. A 2mg dose has been selected for the RXC004 study for colorectal cancer and the other RXC004 study for pancreatic cancer and unselected biliary cancer. Both these studies have already commenced. There is also a phase II study for use of RXC007 as a treatment for idiopathic pulmonary fibrosis (IPF) starting later this year. These studies mean that costs will increase. There was £29.6m in the bank at the end of September 2021 and a further $19m in milestone payments have been received since then.
M and C Saatchi (SAA) independent directors have rejected a revised offer from AdvancedAdvT (ADVT). The offer was 2.245 AdvancedAdvT shares for each Saatchi share or an alternative of 1.633 AdvancedAdvT shares plus 40p in cash for each share. The alternative is worth less than the all share offer. AdvancedAdvT says that it would move to AIM.
MAIN MARKET
ACP Energy (ACPE) is a standard listed cash shell seeking oil and gas acquisitions. It raised £830,000 at 5p a share. The share price ended the first day at 6.5p (5p/8p). The focus is the upstream oil and gas industry, particularly projects where oil and/or gas has already been discovered, which may be producing assets or ones where there has been some development spending. A minimum market capitalisation of £30m after the first acquisition is being targeted.
Air Partner (AIR) is recommending a 125p a share cash bid by Wheels Up Experience Inc, a provider of on demand private aviation in the US. This values the aviation services provider at £84.8m.
Associated British Engineering (ASBE) did not generate any revenues in the year to September 2021. NAV is 43p a share, including £489,000 in cash, although a Nasdaq investment has subsequently fallen in value. The trading business was sold in 2020.
Sivota (SIV) has entered into a conditional deal to acquire a majority stake in digital marketing platform Apester. There has been $36m invested in the technology and revenues were $9.2m in 2021.
OTHER MARKETS
FOS Holdings (FOS) has switched its listing from Vienna to the Cyprus Emerging Companies Market. FOS has decided to build film studios in Cyprus as part of a joint venture with Dias Media. The company’s subsidiary FOS Film Studios will have a 75% stake in the joint venture. The plan is to build a complex of three film and TV studios, plus additional facilities. There are plans to seek a loan from the EU and the Cyprus government is keen to have film infrastructure on the island. The first studio could be finished by the end of 2022. FOS has three films in early-stage development.
IPSX-listed building owner Mailbox REIT (MBOX) has declared a dividend of 1.75p a share for the fourth quarter of 2021. This is the first step in paying an annual dividend total of 7p a share. Mailbox REIT owns a single building in Birmingham and plans to switch 50,000 square feet of retail space into office accommodation. NAV is 101.9p a share.
Andrew Hore
Quoted Micro 6 December 2021
AQUIS STOCK EXCHANGE
Hydrogen Future Industries (HFI) was set up to make investments in the hydrogen sector. It raised £2.23m at 10p a share. This will finance the investigation of investment opportunities.
Field Systems Design Holdings (FSD) reported a lump in revenues from £19.8m to £9.98m in the year to May 2021, due to Covid-related problems. This meant that the mechanical and electrical design company moved into loss. The AMP7 water sector investment programme did not start as expected. Other projects have also been delayed, but power generation and transport infrastructure business held up better than the water business, which continues to be delayed. Field Systems Design is also being more selective about energy from waste projects. There was £6m in cash at the end of May 2021.
EPE Special Opportunities (ESO) is investing €10m in the €150m offer by new SPAC EPIC Acquisition Corp, which will be listed on Euronext Amsterdam. The target company would be involved in the consumer sector. EPE has published a prospectus for the issue of up to 20 million zero dividend preference shares at 100p each.
Capital for Colleagues (CFCP) has concluded a partial disposal of its investment in TPS Investment, which distributes pipes and valves. There was an initial £200,000 and £121,000 will be received from a share buyback about the company. That leaves a stake in TPS valued at £510,000.
Aquis Stock Exchange-quoted non-fungible tokens (NFTs) investor NFT Investments (NFT) has swapped its £500,000 investment in Kodoku Studios for a 3% stake in Pioneer Media (PNER) valued at £2m and £125,000 in cash. Mike Edwards is a director of NFT and Pioneer. NFT has invested $1m in NFT Studios Ltd in return for a 20% stake.
Watchstone Group (WTG) has filed a claim against KPMG totalling £13.73m plus interest. This relates to the audit of the 2013 accounts of the company, then known as Quindell. These accounts were restated and the FRC fined and reprimanded KPMG.
Quetzal Capital (QTZ) has invested £1.5m in a convertible loan to TAP Global Ltd and it has an option to acquire 100%. TAP Global is a regulated (by the Gibraltar Financial Services Commission) Crypto-Fiat exchange services provider, which plans to provide a bridge between traditional and crypto assets. TAP Global is already generating revenues.
Altona Rare Earths (ANR) has completed the 2021 drilling programme at the Mozambique Monte Muambe project. Chief executive Christian Taylor-Wilkinson bought 66,560 shares at 11.3p each and he owns 6.3% of the company.
South Africa-based social impact company Inqo Investments Ltd (INQO) raised cash from selling land and this has strengthened the balance sheet. Inqo continues to lose money.
Belvedere Leisure (BL03) has taken control of the 160 acre Barnsoul caravan park, which was near to full capacity during the peak season. Development of the park is continuing ahead of a reopening next spring.
Evrima (EVA) has elected to maintain its project level interest of between 8.86% and 9.26% in the Molopo Farms complex. Kavango Resources (KAV) is exercising its option to take a stake of more than 50%.
Dispersion Holdings (DEFI) has launched a new platform called AQRU, which is a platform that enables institutional investors simple access to crypto yields available in DeFi. Recently purchased Accru Finance developed AQRU, which will not be open to UK-based investors until it is approved by the FCA.
Fuel additives supplier SulNOx Group (SNOX) has signed a distribution agreement with LocoSoco Group.
MiLOC Group Ltd (ML.P) has raised £23,000 at 28.5p a share.
Slater Investments has increased its stake in Arbuthnot Banking (ARBB) from 3.05% to 5.15%.
Rogue Baron (SHNJ) managing director Ryan Dolder bought 32,477 shares at 12p each and 58.827 shares at 9.5p each, taking his stake to 10.5%.
Sativa Wellness (SWEL) has appointed Arden as corporate adviser. It hopes that the broker can help to improve the share price.
AIM
Battery technology developer Gelion (GELN) raised £16m at 145p a share when it joined AIM. The share price has soared to 265p. Australia-based Gelion is a zinc-bromide battery storage technology developer. It is also developing battery additives for use in lithium-ion and lithium-sulfur batteries. Gelion Endure zinc-bromide batteries are suited for harsh environments and the non-flow zinc-bromide technology means that they can be smaller than rival lithium-ion and lead-acid technologies and are recyclable. The cash will be used to accelerate development spending.
Skillcast Group (SKL) provides content and software to companies for their training and compliance requirements. Skillcast has joined AIM to raise further cash to invest in cloud technology and training content. It raised £3.5m in a placing at 37p a share and the share price ended the week at 43p. Revenues are generated from professional services and SaaS subscriptions and the main growth comes from the latter. There were annual recurring revenues of £5.06m at the end of June 2021. Clients include Schroders and GKN. The shares are tightly held.
A trading statement from franchised lettings and estate agency Belvoir Group (BLV) led to a 3% upgrade in forecast 2021 earnings to 20.3p a share.
IPTV technology developer Mirada (MIRA) grew interim revenues by 10% to $6m thanks to increasing installations for izzi Telecom. Mirada has buit up a 5% global share of the Android TV market. The increasing use of resellers in different regions of the world should help Mirada to grow more quickly than it could relying on direct sales. There was a recent partnership agreement with North America-focused Shift 2 Stream.
Vector Capital (VCAP) says 2021 revenues and pre-tax profit will be better than expected.
Interim revenues of Coral Products (CRU) were 58% ahead at £7.1m and pre-tax profit improved from £494,000 to £698,000. The interim dividend is 0.5p a share. Plastic lotion pumps supplier Global One-Pak was hit by the ill-health of its boss and problems importing from China, but trading is improving.
Human capital services provider Mind Gym (MIND) increased its interim revenues by two-thirds to £24.1m and it returned to profit. Revenues are back to the levels in the first half of 2019, although the profit is much lower. Digital revenues account for 81% of the latest revenues.
Online fashion retailer Sosandar (SOS) nearly trebled its interim revenues, helped by maintaining high stock levels following the fundraising earlier this year. Strong trading, both from the company’s website and through third parties, continues to be strong. October was a record month and November was even better. The full year revenues forecast has been raised by 11% to £27.1m. Sosandar could move into profit next year.
Cenkos has upgraded its free cash flow forecast for Duke Royalty (DUKE) following the latest interims. It is expected to be 2.3p a share, which will cover the forecast dividend of 2.2p a share. There is a record deal pipeline
Lekoil Nigeria is offering to acquire the 60% of Lekoil Ltd (LEK) that it does not own for double the suspension price of 0.95p or for a share exchange.
MAIN MARKET
Guernsey-registered technology shell Hambro Perks Acquisition Company Ltd (HPA1) raised £140m through a placing at 1000p per unit (one public share and 0.5 of one public warrant). The price went to premium and fell back to 1000p. An attractive market, innovative product or service, scalability and strong management will be required in any target. The target business would be valued at £800m or more. The Hambro Perks Ltd advisory business has expertise in investing in early-stage technology businesses and could have potential targets in its funds.
Town Centre Properties (TOWN) maintained its underlying NAV at 284p a share. Net debt was reduced to £145.6m and LTV is 51.3% at the end of June 2021. The full loss was significantly reduced, although there was cash generated from operations. The final dividend is 1.75p a share, taking the total for the year to 3.5p a share, down from 5p a share.
Telecoms services provider Toople (TOOP) is raising £380,000 at 0.045p a share. The previous placing was at 0.11p a share during October 2020.
Rebel shareholders in beverages supplier East Imperial (EISB) have withdrawn their general meeting requisition following the appointment of Alistair McGeorge as chairman and Colin Henry as a non-exec. Rabindra Lal Soni has resigned as chairman.
Andrew Hore
Andrew Hore – Quoted Micro 10 August 2020
AQUIS STOCK EXCHANGE
National Milk Records (NMRP) generated revenues of £5.35m in the quarter to June 2020, down from £5.6m in the previous year. Milk recording revenues declined because of COVID-19 restrictions. There was limited disruption to other parts of the business. The second half of the year to June 2020 was still better than the first half.
British Honey Company (BHC) has signed a four-year global licensing and distribution agreement with English Heritage. Spirits will be sold under the English Heritage brand.
The Hellyer gold mine operated by NQ Minerals (NQMI) achieved record production levels in July. The new processing plant had a monthly throughput of 106,365 tonnes. There was 4,075 tonnes of lead concentrate, 1,509 tonnes of zinc concentrate, 461 ounces of gold and 89,854 ounces of silver produced.
Sport Capital Group (SCG) intends to refocus its investment strategy on the natural resources sector and change its name to Evrima. An investment has been made in Kalahari Key Metals Exploration. A share consolidation of ten shares into one new share is planned.
Clean Invest Africa (CIA) says that its subsidiary CoalTech has signed heads of agreement for a feasibility study and commercialisation of a 5,000 tonnes per month pelletising plant in New South Wales. The study will take three months and it would take a further nine months. The plant would be near to a power station.
MiLOC Group Ltd (ML.P) increased its revenues from HK$10.7m to HK$15.4m in the year to December 2019, but the loss still increased to HK$40.6m, partly due to stock write-downs. Both traditional Chinese medicine products and the company’s clinics made higher contributions to revenues.
Asia Wealth Group Holdings (AWLP) reported a decline in revenues from $2.4m to $1.43m in the year to February 2020. There was a swing from profit to loss.
AIM
NWF (NWF) benefitted from strong demand for heating oil and the slump in the oil price. There were bumper profits from the fuel distribution business in the year to May 2020. Operating profit nearly doubled to £11m and this won’t be repeated. Opening cost of the new Crewe facility led to a dip in profit contribution from food distribution. The feeds business increased market share but profit fell. Group pre-tax profit improved from £9.7m to £11.5m. A pre-tax profit of £10.7m is forecast for next year.
Telecoms hardware manufacturer Filtronic (FTC) reported full year figures in line with the recent trading statement and there was a small pre-tax profit. Revenues are building up as demand for 5G products increases. There is spare manufacturing capacity and efficiency will improve as capacity is used up. The US-based subsidiary is in a good position to win 5G orders.
Applied Graphene Materials (AGM) has signed two new distribution agreements. A deal with Arpadis Benelux will enable Genablle graphene dispersion technology to be sold in the main speciality chemicals markets in Europe. An agreement with Maroon Group provides access to the coatings and polymers sectors in North America.
Construction materials distributor Brickability (BRCK) generated revenues of £23.8m in the three months to June 2020. There was a loss in April but Brickability returned to profit in May and June.
Telecoms customer engagement software provider Pelatro (PTRO) is raising £21m at 47p a share. This will fund investment in sales and marketing and working capital. Pelatro is profitable but cash generation has been relatively poor, although it was better last year.
Lawyer Ince Group (INCE) has reported 2019-20 figures that show an underlying pre-tax profit of £7m, although earnings per share declined following share issues. The consolidation of international acquisitions has been completed and IT is being improved. First quarter trading is 10% below plan but the business is still profitable.
Intelligent Ultrasound (MED) was quick to develop a COVID-19 module for its machines and this helped to partly offset a drop in first half revenues. Losses continue but the potential launch of AI-based products in 2021 and 2022 will put the company in a good position to move into profit.
K3 Business Technology (KBT) is a much smaller business following the sale of its UK Dynamics subsidiary, but it has a more solid and profitable base. Interim revenues slipped from £27.9m to £27.2m. K3’s own IP contributed 48% of revenues.
Fulcrum Utility Services (FCRM) has a better base going into the year to March 2021, even though the multi-utility infrastructure services provider was hit by the construction lockdown in the first quarter. Housebuilding activity is improving. Operational inefficiencies are being addressed.
Entertainment events marketing services provider Reach4Entertainment (R4E) intends to leave AIM in order to save money and enable greater flexibility. The share price slumped after the announcement, but it has moved back above the price at the beginning of the week. Chief executive Marc Boyan has bought 70 million shares at 0.2155p a share. That takes his stake to 16.1%. Herald has sold its 14.4% stake and Matthew Freud has bought a 14.95% stake.
Pensions administrator STM (STM) says that interim trading was in line with expectations thanks to its recurring revenues and control of costs.
Mergers adviser K3 Capital (K3C) has acquired Quantuma Advisory, which is focused on insolvency and restructuring, for an initial £20.2m. A further £6.7m could be payable depending on performance over three years.
Yourgene Health (YGEN) is acquiring Coastal Genomics for an initial $5.5m and up to $8m dependent on performance. Vancouver-based Coastal is a sample preparation technology company. The technology complements Yourgene’s technology and gives it a North American base. Yourgene raised £15m at 17p a share.
MAIN MARKET
Castillo Copper (LON: CCZ) joined the standard list on 4 August. Castillo raised £1.3m at 1.7p a share and the share price ended the week at 2.45p (2.2p/2.7p). There are three core projects, but the one that management is focusing on is Mt Oxide. The plan is to develop a copper mine. The Ayra prospect is the main exploration target and £450,000 will be spent on the Mt oxide area. The other core projects are the Cangai copper project in Australia and the Zed projects in Zambia.
BATM (BVC) says Vodafone has completed proof-of-concept on the ARM-based uCPE, which includes BATM’s network functions vizualisation (NFV) operating system. Field trials are likely to follow. This shows that both the networking and biomedical have good growth prospects. Stifel forecasts a rise in BATM pre-tax profit from $4.8m to $7.7m in 2020.
Construction and infrastructure services provider NMCN (NMCN) had a strong first quarter but a tougher second quarter meant that interim pre-tax profit fell by three-quarters. Even so, an interim dividend of 10p a share has been announced, which partly compensates for the lack of 2019 final dividend. There was an improved performance in telecoms and water is at the lower point in the cycle. Construction sites are becoming more active. Progress Equity Research forecasts a full year pre-tax profit of £1.9m, before recovering to £7.6m next year. A forecast total dividend of 15p a share for 2020, would not quite be covered by earnings.
Seafox International was successful in persuading Gulf Marine Services (GMS) shareholders to appoint Hassan Heikal and Hesham Halbouny to the board of the offshore oil services provider. They each received 57.7% of the votes.
Standard list shell Boston International Holdings (BIH) had £310,000 in cash at the end of June 2020, although there is also an unsecured loan of £200,000.
Argo Blockchain (ARB) mined 165 bitcoin in July, down from 180 in June. There were problems in the middle of the month. Mining revenue was £1.25m in July.
Andrew Hore
Andrew Hore Quoted Micro 19 August 2019
NEX EXCHANGE
Brewer Adnams (ADB) reported a decline in first half revenues from £35.5m to £34.7m, while the loss increased from £840,000 to £1.15m. Beer volumes were 2% ahead, compared with a 1% decline in the market. Low alcohol beer sales grew. Gin sales fell because of greater competition. A fire at the Ship at Levington hampered the performance of the pubs business. Adnams made an underlying profit in 2018, thanks to a better second half performance. The new IT system went live in March and the implementation has been a distraction to management. The dividends are unchanged at 78p a share for each B share and 19.5p per A share.
Bruce Pubs (PUB) has decided to cancel trading in its 7.2% secured bonds, 31 March 2022. There are £20,000 worth of bonds admitted to the market and there have been no trades. Bruce Pubs had wanted to raise up to £20m from the bond issue. It is therefore not a surprise that Bruce Pubs believes it is not worth having a trading facility. The bonds can be redeemed early by the company.
NQ Minerals (NQMI) has produced 10,164 tonnes of lead concentrate, 7,431 tonnes of zinc concentrate and 46,863 tonnes of pyrite concentrate in the first half of 2019. An operating profit of A$3.6m was made on sales of A$23m.
TechFinancials (TECH) had $1.23m in the bank at the end of June 2019. A reduction in trade receivables meant that there was a small cash inflow from operating activities, but there was $402,000 capitalised developed on the blockchain ticketing system.
China-focused healthcare company MiLOC Group Ltd (ML.P) has raised £755,000 at 30p a share.
Queros Capital Partners (QCP) has gained a quotation for its bonds on the Frankfurt Stock Exchange
AIM
ICAMAP has acquired 7.94 million shares in easyHotel (EZH) at its offer price of 95p a share, taking its stake to 44.1%. This means that it is a mandatory cash offer.
Iofina (IOF) has launched IofinaEX Global to deal in hemp derived products in Central America and the Caribbean. Iofina will potentially link up with a government in the region that wants to develop its country as a hub for hemp derived products. There are no details of this potential partnership. The company believes that its regulatory expertise in the iodine market will be helpful in the CBD market. The US is likely to be a major market.
LightwaveRF (LWRF) has raised £1.3m at 7p a share. The smart homes equipment supplier wants the cash to finance further growth. There are also plans to secure a facility for stock.
Altitude (ALT) is considering the disposal of its Manchester-based promotion products supplier AdProducts.com. This would enable Altitude to concentrate on its AIM platform for promotional products suppliers.
Greatland Gold (GGP) has raised £4.2m at 1.85p a share and that will be used to finance exploration in the Paterson region of Australia. There has been positive exploration news from the Scallywag prospect in the Paterson region. A ground gravity survey starts this month and an induced polarisation survey next month. Then 3D modelling using the data will come up with drill targets.
Cyber security software and services provider Corero Network Security (CNS) says interim revenues are lower, but operating costs are unchanged. That means that the interim loss has increased. However, full year revenues are expected to be one-fifth higher, but higher investment in sales means that the loss will still be higher. Net cash was $3.6m at the end of June 2019.
Equals Group (EQLS) is raising up to £16m via a placing and open offer. The international payments company has raised £14m at 110p a share and up to £2m will come from the one-for-90 open offer. The cash will be used for acquisitions and working capital.
Tanfield (TAN) says that 49%-owned Snorkel International has moved back into profit in the second quarter of 2019, although the first half was still loss-making. Last year, the value of this investment in the access equipment supplier was cut from £36.3m to £19.1m.
Oil and gas producer President Energy (PPC) says that there should not be a material effect on its operations from a change in Argentinian president. Revenues are US dollar based and cash is held in the same currency, so the decline of the Argentinian peso should not be too much of a problem.
Anthony Laiker has subscribed £25,000 in Vela Technologies (VELA) at 0.1p a share. A general meeting has to approve the share issue to the executive director, as well as an issue of 6.25 million warrants exercisable at 0.15p. Approval of the conversion of £200,000 of loan notes plus interest into nearly 241 million shares will also require the company to be given the ability to issue more shares. Laiker would than own more than 301 million shares.
Gfinity (GFIN) is pulling out of its Australian joint venture because the esports company wants to focus its cash on the US and other important markets.
Workspace software provider Essensys (ESYS) says that its revenues were one-quarter higher at £20.5m in the year to July 2019. That was better than expected. Annual recurring revenues run rate is £17.3m.
MAIN MARKET
Associated British Engineering (ASBE) made an increased loss of £1.81m, up from £582,000 the previous year. The company’s main pension fund remains a worry and there are ongoing discussions with the Pensions Regulator. There are net liabilities of £3.71m after the pension deficit of £4.98m.
Nanoco (NANO) generated revenues of £7.3m in the year to July 2019, more than double the previous year. The cadmium-free quantum dots developer had £7m in cash at the end of July and expects to have £6m at the end of 2019.
Highway Capital (HWC) has issued €30,000 of new convertible loan notes. These are convertible to a value in excess of 50% of the net asset value of the company at the time of conversion. The terms of an existing convertible loan note of £100,000 have been changed and the conversion price is 5p a share.
Shareholders in Avocet Mining (AVM) have voted against the resolution to wind up the company. This means that it is likely to go into administration unless there is a viable transaction that the board can assess.
Global Resources Investment Trust (GRIT) wanted shareholders to approve the voluntary liquidation of the company, but there is not enough support for the proposal. GRIT has sold 430 million shares in Kalia for £225,000 in order to provide working capital. A new board is being appointed to undertake a strategic review. James Normand will become chairman and Martin Lampshire as an executive director. Stephen Roberts will become a non-executive director.
IMC Exploration (IMC) has been awarded two additional licences in County Wexford. They adjoin an existing licence where there are indications of gold.
Book publisher Quarto (QRT) reduced its interim loss from $6.6m to $4m on flat revenues of $56.4m. There was a change in the mix of revenues with children’s books increasing revenues by14% and in geographic terms more of the revenues were in the US, which moved into profit. Net debt has fallen by 11% to $65m.
Zenith Energy (ZEN) says that drilling has commenced at well C-37 in the Jafarli oilfield.
Pendragon (PDG) is selling its Chevrolet dealership in California for £17.2m. GM can alternatively nominate another purchaser if it wants. The rest of the US business will be sold.
Andrew Hore
Andrew Hore – Quoted Micro 3 June 2019
NEX EXCHANGE
BWA Group (BWAP) has conditionally agreed to acquire share capital of a company with rights to five mining projects, predominantly in Quebec. The company is majority owned by Canadian Stock Exchange listed St-Georges Eco-Mining Corp and the total cost of the deal is C$7.5m (£4.3m). This will be paid in unlisted, convertible, interest-free loan notes. The repayment date will be three years after issue. The notes are convertible at 0.5p a share, or the market price of a share if it is higher. BWA will subscribe for C$300,000 (£170,000) of shares in St-Georges. BWA needs to raise at least £500,000 to go ahead with the deal.
Chapel Down Group (CDGP) increased 2018 sales by 10% to £13m. Turnover from wine and spirits and from Curious Drinks grew by similar percentages. However, a pre-tax profit of £253,000 to a loss of £850,000 as overheads were doubled to £5.57m. There is still £12.8m in the bank even though there was a cash outflow from operations and £8.37m of capital investment. There are 635 acres of vineyards that have been planted and a further 388 acres will be planted on the North Downs.
Wealth management firm AFH Financial (AFHP) increased interim revenues by 61% to £36.6m and underlying earnings per share were 49% higher to 14.9p a share. AFH continue to acquire IFA firms. Funds under management totalled £5.4bn and that is expected to nearly double within five years.
St Mark Homes (SMAP) has net assets of 130p a share, which is a discount of around one-third to the share price bid/offer of 85p/90p. The dividend was maintained at 5.5p a share, providing a yield of more than 6%. In 2018, revenues increased from £120,000 to £294,000, but underlying pre-tax profit declined to £80,000, because of higher overheads and a lower contribution from joint ventures. The regional housebuilder intends to release capital from existing developments to fund other opportunities in the outer London Boroughs.
Coinsilium (COIN) reported near-trebled revenues of £1.68m in 2018, but a pre-tax profit of £121,000 was turned into a loss of £982,000. That is due to much higher overheads and a £973,000 impairment of current assets. There was £592,000 in the bank at the end of 2018. Most of the revenues came from advisory services to blockchain companies. That business has moved to Gibraltar.
KR1 (KR1) made reduced realised gains in 2018 and there was an unrealised loss on investments, compared with an unrealised gain in 2017. The total pre-tax loss was nearly £11m. The NAV fell from £13.6m to £6.11m.
Capital for Colleagues (CFCP) increased the value of its investments by around £630,000, which reflects performance and prospects. Even without that unrealised gain, the loss declined. The NAV of the employee-owned businesses investor rose from 41.5p a share to 48.1p a share at the end of February 2019.
European Lithium (EUR) is commencing a drilling programme to confirm part of the inferred resource at the Wolfsburg lithium project in Austria. This data will be used in the definitive feasibility study.
In the six months to February 2019, Wheelsure Holdings (WHLP) reduced its loss from £181,000 to £126,000. Revenues remain small but they grew from £44,000 to £61,000. There were orders from Germany in the period, but Netherlands and Austria were delayed. Lower overheads helped to reduce the loss.
Cancer therapy provider Proton Partners International Ltd (PPI) generated revenues of £1.47m in the year to February 2019. There was cash generated from operations but that was dwarfed by £42.3m of capital investment. Additional cash has been raised since the year end.
In 2018, the revenues of Chinese treatments supplier MiLOC (ML.P) dipped from HK$11.6m to $10.7m, while the reported loss more than doubled to HK$37.9m. That was mainly due to a royalty fee related to AKFS Plus haircare brand. There was HK$2.75m in the bank at the end of 2018. Since then, HK$3.45m (£334,000) has been raised in a placing at 28.5p a share.
Cannabis investor Sativa Investments (SATI) has secured a commercial offtake agreement with a Portuguese supplier of cannabis oil. This will be included in products produced in Somerset.
Barkby Group (BARK) has secured a new six-year lease for the Rose and Crown Inn, near Swindon. This is the second lease from Arkell’s Brewery.
TechFinancials Inc (TECH) says 75%-owned Footies Ltd has completed its sports ticketing system demonstration product. This will enable it to approach potential football club clients. It is still hopeful that it can sign one up this year. Ian Ayre has stepped down from the Footies board.
Investment company Eight Capital Group (ECP) had net assets of £668,000 at the end of 2018. The investments include shell companies Abal Investments (ABAL) (formerly Imaginatik) and Sport Capital Group (SCG) which has net assets of £206,000 at the end of 2018.
Investment fund manager Startup Giants (SUG) still had £646,000 in the bank at the end of 2018.
Trading in the shares of Angelfish Investments (ANGP), London Capital Group (LCG), Black Sea Property (BSP) and Gamfook Jewellery (GAMF) is suspended because they have not published their 2018 accounts. Gamfook has replaced its auditor and will not publish accounts before the middle of July. Allenby has ceased to be nominated adviser and broker, as well as NEX corporate adviser, to PCG Entertainment. Trading in PCG shares is already suspended because of a potential reverse takeover.
AIM
Ramsdens (RFX) has acquired another four stores trading as The Money Shop and 12 loan books from Instant Cash Loans. This takes the number of stores acquired to 22 and the loan books to 17. Ramsdens says that there will be a small contribution to profit in the first year. The additional stores will be rebranded as Ramsdens and it has 163 stores. The 2018-19 figures will be published on 12 June.
Ideagen (IDEA) has gained a new £1.2m, three-year SaaS contract with an airline. The software will be used for safety incident reporting. Ideagen is expected to report a 2018-19 pre-tax profit of £12.2m.
Volvere (VLE) is returning up to £16.6m via a tender offer at 1290p a share, a premium of 12% to the market price when it was announced. Recent disposals have generated £25.6m, which took the cash pile to £36.2m. Management says it requires around £20m of cash for ongoing requirements.
Stride Gaming (STR) has received a bid proposal from Rank Group. A 151p a share offer is being considered. Stride floated four years ago at 132p a share.
TSX Venture Exchange company Hunt Mining Corp is offering 10.76 shares for each share in Patagonia Gold (PGD) and this values the target at £17.2m. The bid is recommended, and Patagonia shareholders will own 80% of the enlarged company. Hunt is producing silver and gold in Argentina and Patagonia has assets in the same region.
Nautilus Mineral Services (NAUT) wants to cancel its AIM quotation. A general meeting has been set for 24 June and shareholders owning 73.4% agree with the proposal. A matched bargain facility is planned.
Suits manufacturer Bagir (BAGR) still has not received the remaining cash investment of $13.2m from Shangdong Ruyi, which has requested an extension and wants to change the terms of the deal.
AfriTin (ATM) says that it expects to ramp up production at the Uis tin mine in the fourth quarter. The initial phase of the plant will be able to produce 60t/month of tin concentrate.
AssetCo (ASTO) says that Grant Thornton has been granted permission to appeal the judgment against it relating to the auditing of past AssetCo accounts.
Tavistock Investments (TAVI) has ended its strategic alliance with Lighthouse Group (LGT) because of the Quilter takeover of the IFA.
MAIN MARKET
Aptitude Software (APTD) plans to sell Microgen Financial Systems for £51m. Previously, this business was going to be demerged on AIM. There should be £48.4m after expenses and a majority of this will be returned to shareholders.
Standard list shell Fandango Holdings (FHP) has ended acquisition discussions with Konnect Mobile Communications because it could not raise the funds it required. There was £8,000 in the bank at the end of February 2019.
Novo Holdings has exercised its option to subscribe for 6.57 million Oxford Biomedica (OXB) shares at 690p each. Novo will own 10.1%.
Summerway Capital (SWC) had £5.69m in cash at the end of February 2019. Potential acquisitions have been identified.
Toople (TOOP) has raised £662,000 at 0.35p a share and it will use £150,000 as final settlement of £601,000 of loans from David Brieth. There was £1.15m in the bank at the end of March 2019. There was a cash outflow of nearly £1m in the previous six months. Last September’s placing was at 0.3p a share.
Cathay International Holdings (CTI) has been fined £411,000 by the FCA due to a breach of listing principles. These relate to the preparation of forecasts and monitoring of financial performance, as well as a failure to provide information in a timely manner. Chief executive Jinyi Lee and finance director Eric Siu were both deemed to be involved in the breaches but they are considering an appeal.
Andrew Hore
Andrew Hore Quoted Micro 25 February 2019
NEX EXCHANGE
Western Selection (WESP) has reported a 22% decrease in NAV to 75p a share, due to the decline in smaller quoted company share prices. The NAV has recovered to 79p a share. The investment in Swallowfield (SWL) declined by nearly one-third and the value of the Bilby (BILB) stake fell by two-fifths in the six months to December 2018. Net debt was £1.25m at the end of 2018. The interim dividend is maintained at 1.1p a share.
Early Equity (EEQP) has acquired a 60% stake in MEI Home, a ecommerce platform for household, health and food products, for £282,000. The Malaysia-based business was profitable in the first financial year. The founder will retain a 40% stake and he also owns 6.12% of Early Equity. He also promises that annual pre-tax profit will be at least £95,000 in each of the next two financial years.
Tectonic Gold (TTAU) has taken a 50% stake in a joint venture with Vast Mineral Sands covering diamond mining concessions at the government-owned Alexkor diamond mine in South Africa. This should generate cash, through planned production of 900 carat per month, to invest in other projects. Tectonic is paying $650,000 in shares at 2.2p each. A year long research study has confirmed that there is an interaction of two styles of mineralisation at Mount Cassidy prospect in Queensland, Australia. There is stratabound copper and zinc, gold and silver mineralisation and epizonal to epithermal gold and silver mineralisation.
MiLOC Group Ltd (ML.P) has extended the life of its convertible bond by one year to 19 January 2020. The annual coupon increases from 6% to 7.2%. The conversion into shares can take place if an alternative quotation on a recognised stock exchange is secured.
First Sentinel (FSEN) has completed a £4m bond issue. These 7% bonds 2023 are due to start trading on NEX.
AIM
Michelmersh Brick (MBH) has made its first acquisition outside of the UK. Michelmersh is paying up to €9.9m (£8.7m) for Antwerp-based Floren and Co in a deal that should be immediately earnings enhancing. A placing raised £5m at 90p a share. In 2018, Floren generated EBITDA of €1.75m on revenues of €5.7m. Michelmersh is planning to increase production levels from 19.5 million bricks a year. The acquisition includes 120 acres of land, of which 60 acres is used in production.
IP legal services provider Murgitroyd Group (MUR) is acquiring Southampton-based Chapman IP for £6.6m and Helga Chapman has been appointed a non-executive director. Net cash was £2.03m at the end of November 2018. Interim pre-tax profit edged up from £1.67m to £1.7m. The interim dividend was increased by 8% to 7p a share. Edward Murgitroyd is retaining his role as chief executive and handing over the role of finance director Keith Young.
Carpets and hard flooring manufacturer Victoria (VCP) continued to sacrifice margins in order to add market share in a declining flooring market in the UK in the second half of the financial year to March 2019. Full year EBITDA should be between £95m-£97m, with underlying pre-tax profit of at least £55m. This is not as much as previously forecast. There are additional inventories ahead of Brexit. Restructuring measures and capital investment should add more than £14m to pre-tax profit for the year to March 2020.
JD Sports Fashion (JD.) has acquired 21.3% of Footasylum (FOOT) and it says it may acquire up to 29.9%. FIL Ltd’s stake has fallen below 5%. Artemis has sold its 5.74% stake.
Angling Direct (ANG) expects to report full year revenues of £42m, up from £30.2m. Three new stores have been added to the group, taking the total to 24. International sales doubled. The full year results will be published on 13 May. Angling Direct is considering the acquisition of Glasgow-based Chapmans Angling Ltd, which is a subsidiary of The Glasgow Angling Centre Ltd.
Egdon Resources (EDR) has competed drilling at Biscathorpe-2 in Lincolnshire. There are signs of an effective petroleum system even though the sands were poorly developed. The reservoir may be better developed to the north of the well. Egdon owns 35.8% of the exploration licence and Union Jack Oil (UJO) owns 22%.
Trinidad-focused oil and gas producer and explorer Touchstone Exploration Inc (TXP) has raised £3.8m at 12p a share in order to finance the 9,000 feet of exploration drilling at Ortoire.
Pelatro (PTRO) has gained a contract to supply its mViva contextual marketing service to Vietnam-based Vinaphone. The deal with the telecoms company should be worth $1.5m over three years. Pelatro gets a fixed monthly fee plus a share of incremental revenues generated. This provides additional confidence that the 2019 revenue forecast of $10.5m can be met. That is expected to generate pre-tax profit of $6m because of the high operational gearing of the business.
SkinBioTherapeutics (SBTX) has raised £1.5m at 16p a share from Seneca Partners. There was £2.52m in the bank at the end of 2018. The cash will be invested in further development of products and commercialise them.
Duke Royalty (DUKE) has provided £10m of royalty finance to recreational vehicle parts wholesaler Miriad Products. The monthly payments are expected to provide a yield the equivalent of 13% a year.
Biopesticide products developer Eden Research (EDEN) has a second approved product thanks to its commercial partner Eastman Chemical Company. Nematicide formulation Cedroz has received authorisation in Malta and Eastman will apply to gain approvals in individual EU member states. The full benefit of these approvals is likely to show through next year.
EKF Diagnostics (EKF) has received US FDA clearance for the use of the Quo-Test glycated haemoglobin analyser in clinical laboratories.
It has been a mixed start to the financial year for Gooch and Housego (GHH) with softer demand in microelectronics, due to trade tariffs, but the second half improvement in subsea cable business has continue. The AGM statement has led to a reduction in the underlying profit forecast for this year from £21.5m to £19m, which is slightly higher than last year’s outcome.
Social housing software provider Castleton Technology (CTP) has acquired its software development partner in India for £350,000 in cash and shares.
eServGlobal (ESG) says that its 35.7%-owned mobile transfer payments joint venture HomeSend increased its average transaction value by 35% in the second half following a change in strategy to focus on account-to-account transactions rather than remittances.
Beximco Pharmaceuticals (BXP) is acquiring eight abbreviated new drug applications in the US from Sandoz Inc. This takes the number of US approved drugs to 14, with four currently being exported to the US.
Haydale Graphene Industries (HAYD) has raised £4m at 2p a share and wants to raise up to £4m more through a seven-for-one open offer closing on 11 March. If these shares are all issued they will account for 93% of the total shares in issue. Haydale needs cash to invest in its inks business as well as to cover continuing losses. Keith Broadbent will become chief executive.
Reach4Entertainment (R4E) has acquired the arts and entertainment advertising agency trading as Sold Out for an initial £3.94m in cash and £250,000 in shares. The total purchase price is dependent on performance in the period from 1 June 2017 to the end of 2021 and is capped at £10m. In the year to May 2018, Sold Out made a pre-tax profit of £1.3m.
Paragon Entertainment (PEL) has sold its current administration offices in York for £550,000. The relocation to other group premises should save £100,000 a year. The cash will pay off the mortgage of £134,000 and reduce the overdraft from £1.04m. The overdraft limit will be cut from £1.2m to £882,000. A creditor owing £168,000 has filed for protection from creditors. Management want to raise additional capital.
Medical devices supplier Inspiration Health (IHC) says revenues for the year to January 2019, will be £15.5m, which is £1m below forecast, and pre-tax profit will be slightly lower than forecast at £1.2m.
Holders Technology (HDT) has more than trebled its full year pre-tax profit of £177,000 thanks to a reduced LED loss and improved profitability at the printed circuit board materials business. There was still a cash outflow from operations. The dividend has been increased by 50% to 0.75p a share.
Arc Minerals Ltd (ARCM) has raised £2.2m at 3p a unit. The unit includes a share and one warrant exercisable at 4.5p each and lasting for 36 months. The cash will finance exploration and development at the Zamsort copper project in Zambia. Arc has also sold its 18.5% stake in Andiamo Exploration for $250,000.
Malvern International (MLVN) has raised £606,000 at 4p a share. This is more than the education services provider originally asked for in order to cover working capital requirements and investment in a new college in Brighton and online course material.
AIM-quoted blockchain and technology investment company Vela Technologies (VELA) is taking advantage of the discount to cash by buying 500,000 shares in cryptocurrency mining services provider Argo Blockchain (ARB) at 3.072p a share. This compares with cash of 5p a share. Vela has 3 million shares in Argo, equivalent to 1.02%. The rest of the shares were bought prior to Argo’s standard listing and cost 8p each, compared with the flotation price of 16p a share. The average cost is 7.17p a share, so the average cost exceeds the value of cash in the business. Argo is refocusing on its own currency mining. Ongoing costs will be cut by one-third, although there will be some one-off cash costs. Net cash is £15m and that is much more than the market capitalisation of Argo.
ReNeuron (RENE) has released early data on three patients in phase I/IIa clinical trial the human retinal progenitor cell product. There have been significant improvements in vision for the patients, but this is a small sample size over a short time. Cash should last until the end of 2019.
Pires Investments (PIRI) has received a requisition notice for a general meeting in order to make changes to the company’s board.
Best of the Best (BOTB) has received tenders for just over 4 million shares, which is 5.6 times the number that it was tendering for. Best of the Best will pay £3.5m for 721,327 shares (485p a share).
FAIRFX Group (FFX) has become a direct participant in the UK faster payments scheme. It is the fourth non-bank to be a direct settling member.
Crossword Cybersecurity (CCS) says Kinnerton Confectionery will be using its Rizikon Assurance secure third party assurance platform.
Former AIM company Lionsgold Ltd (LION) is changing its name to Tally Ltd. Mobile banking app Tally is in beta testing and could be released by the end of February. Once this has been released the company will seek to gain a new quotation. The exercise of warrants, mostly by directors, at 1.2p a share has generated £288,000.
MAIN MARKET
Packaging group Macfarlane Group (MACF) increased its pre-exceptional profit by one-fifth to £11.2m in 2018. Both distribution, helped by acquisitions, and manufacturing divisions increased their profit contributions. Manufacturing sales grew fastest but margins fell. The dividend was increased by nearly 10% to 2.3p a share. Net debt was £13.2m and there are plenty of unused bank facilities to fund any further acquisitions. The pension deficit was reduced by £2m to £9.8m.
In the six months to December 2018, Avation (AVAP) reported doubled earnings per share thanks to the gain on the sale of a A321-200 aircraft. The NAV is 288p. The aircraft fleet continues to increase, particularly turboprop aircraft. Although full year pre-tax profit is set to rise even more than originally forecast, earnings per share are likely to be flat at 31.7 cents. Next year’s profit will be lower, assuming no aircraft disposals.
InnovaDerma (IDP) reported interims in line with expectations and there are plans for a mid-March launch for Skinny Tan in Boots. This will help the second half performance, which is normally stronger. Full year pre-tax profit is expected to more than double to £1.5m, a downgrade of 10%. Net cash was £700,000 at the end of 2018. A cash inflow is expected in the second half, but fluctuations in cash in terms of working capital requirements, such as Boots order levels, during the period could lead to InnovaDerma deciding to raise more money.
Anglo African Agriculture (AAAP) reported a reduction in turnover from £2.13m to £1.74m in the year to October 2018. Even so, gross margins improved and the pre-tax loss edged up from £550,000 to £573,000. Net cash was £856,000. The company is assessing acquisitions outside of the agriculture sector.
Trading in the shares of daVictus (DVT) has been suspended ahead of finalisation of a deal where the standard list shell will buy the rights to a restaurant concept from Typical Dutch NV for £100,000. This is deemed to require a prospectus before the company can be readmitted to the standard list. The Havana Rolled Cigar Music Café concept has been developed at a site in Aruba. daVictus had £431,000 in the bank at the end of June 2018.
Offshore support vessels operator Gulf Marine Services (GMS) has sent out the document for its requisitioned general meeting on 18 March. Rival Seafox International wants to remove the chairman and appoint three new directors. Ithmar Capital Partners wants to appoint another director.
Andrew Hore
Andrew Hore – Quoted Micro 7 January 2019
NEX EXCHANGE
VI Mining (VIM) has not made the required $2.19m loan repayment to Tassili by the end of 2018. Tassili also has right of refusal over the first 24,000 ounces of gold production. The loan is secured by a charge over the VI subsidiary that owns the interest in the Ora Pesa concession. VI had to secure additional funding because it could not draw down from a facility provided by chief executive David Sumner the $7m required in August 2018. The lack of cash has held up bringing Ora Pesa in to production and recommencing mining at Minaspampa.
Angelfish Investments (ANGP) has converted its £150,000 loan to Wallet Ads into a 20% stake in the company, which can deliver more than ten million personalised updates per hour for a campaign. The terms of the £150,000 convertible loan to Rapid Nutrition have been amended. Rapid Nutrition is still set to float in London, but it has been further delayed. The loan will be repaid in nine equal monthly instalments of £16,667 starting at the end of January. Interest will be charged at an annual rate of 15%. Interest owed up until the end of February 2018 has been settled by the issue of 50,000 Rapid Nutrition shares at 13.4413p a share and a further 200,000 shares have been issued as a fee for the amended terms. Rapid Nutrition is quoted on the Zurich-based SIX Swiss Exchange and the last share trade was at €0.17. The share price was more than €1 in 2017.
MiLOC Group Ltd (ML.P) has secured an agreement with China Post Advertising, which will help it to promote Aaron Kwok’s AKFS+ hair care products and future celebrity branded products. China Post has more than 50,000 outlets.
Natural resources investor Hot Rocks Investments (HRIP) used £49,000 in cash in operating activities in the six months to September 2018. The NAV is £804,000 and that includes nearly £48,000 of cash.
AIM
Musical instruments retailer Gear4Music (G4M) continues to be hampered by pressure on margins although sales are increasing. Management had expected this pressure to have ended prior to Christmas but it has continued and on top of this were problems at the warehouse with the increased demand. In the four months to the end of December 2018, sales increased by 41%. Peel Hun has cut its 2018-19 pre-tax profit forecast from £2.6m to £800,000 and this took the shine off the premium rating of the shares.
Trading in the first quarter at Cambria Automobiles (CAMB) is ahead of the same period last year. The new car market was hit by changes in emissions regulations and new vehicle sales were one-quarter lower, but gross profit per unit was much higher because of new franchises with the likes of Bentley and McLaren. There will be more upmarket vehicle franchise openings in February. This offset the effect of lower new vehicle sales and there was a similar experience with used cars, although overall like-for-like profit improved. Aftersales profit also improved.
Digital music distribution technology developer 7digital (7DIG) could lose its contract with Juke GmbH for the Juke music service, which was expected to generate revenues of £4m this year. The service could be closed or reorganised so 7digital takes on more responsibility. 7digital also owes HMRC £417,000 and one of its subsidiaries has been served with a winding-up petition. This tax should be paid before the hearing of the petition on 16 January. 7digital has reduced its annualised cost base by £6.2m and it is winning new contracts.
Faroe Petroleum (FPM) continues to reject the bid from DNO. An independent report provides an estimated valuation of between 186p a share and 225p a share. This does not include the previously announced Equinor asset swap or utilisation of Norwegian tax losses. Cash flow of £90m is expected over the next two years. DNO has been buying shares in the market at between 147p a share and 152p a share and it has taken its stake to 30.6% so the 152p a share cash bid is mandatory. This stake plus acceptances takes total acceptances to 43.8%. DNO can improve its offer up until 27 January.
ReNeuron (RENE) has announced the first collaboration for its exosome nanomedicine platform. There is an initial feasibility stage, where no revenues will be generated. If it moves on to the preclinical safety and efficacy stage, then there will be evaluation payments.
Leaf Clean Energy (LEAF) is reducing directors’ fees by 70% and there have also been reductions for the administrator and employees. This is ahead of the hearing of Leaf’s appeal of damages awarded to it in its lawsuit with Invenergy Wind, where a decision is expected later this year. Invenergy is has already paid Leaf $36.4m and a further $14.2m is included in the Leaf balance sheet, but that will depend on the court decision.
Home automation technology developer LightwaveRF (LWRF) increased its first quarter revenues by 156% to £1.15m. That is nearly as much as in the first half of the previous financial year.
Shareholders have authorised the $25m subscription at $1.60 per ADS by Summit Therapeutics (SUMM). Robert W Duggan is subscribing for the shares. The cash will fund the initiation and commencement of patient enrolment for the phase 3 clinical trial of the potential treatment for C.diff.
Tracsis (TRCS) has won a major, multi million contract with a train operating company, covering all its individual franchises. The flow of revenues is difficult to predict.
Alpha FX (AFX) says that its 2018 figures will be ahead of expectations. The growth came in the UK and internationally.
WANdisco (WAND) has secured its first multi-cloud contract, valued at $565,000. The contract with the telecoms company was won with Amazon Web Services.
Richland Resources (RLD) is seeking to obtain investment to recommence mining at Capricorn Sapphire and it is in talks with one party about the sale of the project. The £400,000 convertible loan facility has been extended to the end of February.
Central Asia Metals (CAML) has consolidated borrowings into one facility of $151m, which is provided by offtake partner Traxys. The debt will be repaid monthly within a four year period.
ECR Minerals (ECR) has submitted nine exploration licence applications in the Yilgarn region of Western Australia.
Ethiopian authorities have reconfirmed their support for the development of the Tulu Kapi gold project and KEFI Minerals (KEFI) has taken the first steps for the community resettlement programme.
MAIN MARKET
Circassia Pharma (CIR) has gained shareholder approval for the move to AIM, which will happen on 4 February. Circassia has completed the acquisition of full US commercial rights to Tudorza and the FDA is expected to approve the transfer of the licence by the end of March. There was £41m in the bank at the end of 2018.
Nanoco (NANO) is partnering with Plessey Semiconductors to use quantum dots to shrink microLED pixels by 87%. This will lead to smaller, higher resolution displays.
Gresham Technologies (GHT) has won orders for Clareti software from two major, world banks. Revenues should start to be recognised this year. Over five years the contracts should be worth more than £7m, with £1.8m likely to be recognised in 2019. However, 2018 revenues will be lower than expected at £20m and profit will be below expectations.
Andrew Hore
Andrew Hore Quoted Micro 1 October 2018
NEX EXCHANGE
Brewer Shepherd Neame (SHEP) managed to edge up its profit despite flat turnover of £156.6m in the year to June 2018. Underlying pre-tax profit was 5% ahead at £11.8m. The total dividend is 3% higher at 29.2p a share. Growth came from the managed pubs but there was a decline in the brewing operations because of the loss of the Asahi contract. Own brand volumes were 0.9% lower, but the division improved its profit contribution. Volumes will continue to fall as third party business is further reduced. The current year has started well.
Chapel Down (CDGP) is opening a bar, restaurant and ginnery called the Chapel Down Gin Works in the Kings Cross area. The wines and beers maker reported a 15% rise in interim revenues to £5.72m. The majority of the growth in revenues came from the wine business and demand continues to exceed supply. The overall loss rose because of the much higher loss from the brewing business. Group profit is second half weighted.
V22 (V22) slipped into loss in the first half of 2018 as the NAV declined from 3.94p a share to 3.88p a share. If the art portfolio is revalued the NAV has increased from 7.47p a share to 8.29p a share.
Coinsilium Group Ltd (COIN) generated revenues of £1.33m in the six months to June 2018. There was a reported pre-tax profit of £554,000, after an impairment charge of £216,000. There was £65,000 of cash generated in the period. The blockchain consultancy and investment company obtained most of its revenues from token sales advisory business.
KR1 (KR1) made a loss of £7.36m in the six months to June 2018. That loss was due to unrealised losses on the carrying value of digital currencies and other investments because of the decline in prices during the period.
Property investor Ace Liberty and Stone (ALSP) increased its annul revenues by one-third to £3.52m, but pre-tax profit declined from £1.12m to £214,000. That was due to a lack of disposal gains and higher interest costs. Ace has acquired the Mecca Bingo Hall in Chesterfield for £3.999m and this generates an annual rent of £301,000.
A €5.34m gain on the acquisition of an investment property helped Black Sea Property (BSP) swing from a loss to a pre-tax profit of €5.11m. The NAV increased from 0.76 cents a share to 1.16 cents a share.
Health staff provider Healthperm Resources Ltd (HPR) nearly trebled its interim revenues to £297,000 as the number of candidates deployed jumped from 50 to 144. There are 158 people enrolled in the Middle East language training centre.
BWA (BWAP) continues to seek a reverse takeover candidate and its two investments are making progress. Prepaid cards provider Prepaid Global Services is making slower than expected progress but continues to plan to gain a quotation. BWA has applied for licences in Cameroon on behalf of investee company Mineralfields. BWA had £76,000 in the bank at the end of April 2018, while shareholder funds increased from £570,000 to £764,000.
Forbes Ventures (FOR) has appointed Igor Zjali as chief investment officer and Kirk Kashefi as a non-executive director. Nigel Quinton becomes permanent finance director. The £100,000 loan from Quanta Capital has been converted into 100 million shares. There was £56,000 in the bank at the end of June 2018. Investee company Civilised Bank has resubmitted its application for authorisation to the Prudential Regulation Authority.
Etaireia Investments (ETIP) engaged Bishop and Sewell to investigate transactions undertaken by former boss Baron Bloom. He failed to report that he received £6,230 of rent due to Etaireia from a tenant of the Ivy Leaf Club property. Bloom is owed outstanding salary and expenses, so no action is being taken by the company. Greg Collier has stepped down as a non-executive director.
Healthcare IT supplier DXS International (DXSP) swung from profit to loss in the year to April 2018, partly due to the interest charge. Revenues dipped from £3.43m to £3.41m. Investment in new products should help to build revenues.
Western Selection (WESP) increased its NAV from 95p to 96p. Improvements in the value of the stakes in Northbridge Industrial Services and Bilby, offset the reduction in the Swallowfield investment valuation. The total dividend has been increased from 2.2p a share to 2.25p a share. The shares are trading at a discount to NAV of around one-third.
Crossword Cybersecurity (CCS) increased its interim revenues by 37% to £544,000 and the loss was reduced from £1.24m to £824,000. There was £1.75m in the bank at the end of June 2018.
The NAV of EPE Special Opportunities (EL.P) fell by 19% to 190.2p a share over the six months to July 2018, due to a halving of the value of the investment in Luceco, where, in August, EPE invested a further £2m.
Wishbone Gold (WSBN) reported flat interim revenues of $3.91m, but the loss increased from $331,000 to $527,000. The revenues were generated from Thailand and Africa. The Honduras operation has been delayed but should be up and running by the end of the year.
Via Developments (VIA1) has raised a further £140,000 from a debenture stock issue.
Interim revenues declined from HK$7.22m to HK$5.27m at MiLOC Group Ltd (ML.P) and there was a significantly higher loss of HK$24.8m. The cash position was HK$7.65m at the end of June 2018. The traditional Chinese medicines supplier was hit by lower wholesale orders. Discussions continue with additional distributors.
AIM
Parasite control products developer TyraTech Inc (TYRU) has signed a conditional merger agreement with American Vanguard Corporation, which involves an offer to the other TyraTech shareholders of 3.15p a share. TyraTech needs cash to grow and 34.4% shareholder American Vanguard is in a stronger position to obtain the finance. TyraTech had cash of $3.7m at the end of June 2018.
Northbridge Industrial Services (NBI) is still losing money but the electrical and oil and gas tools markets are showing signs of improvement. A full year loss of £2m is still expected but the group could reach breakeven next year. Northbridge has the cash to invest in additional rental equipment.
Rose Petroleum (ROSE) reported a lower interim loss and it had net cash of $2m at the end of June 2018. Drilling of the first well on the company’s Paradox Basin acreage in Utah should start before the end of the year. A recent report suggested that there could be 13mmboe of 2C resource. There has been successful exploration in the area and it already has the appropriate infrastructure. If the appraisal well is a success that should provide a strong background for a further fundraising.
Keystone Law (KEYS) grew interim revenues by 30% to £19.9m thanks to strong recruitment of new lawyers. This progress means that Keystone is on target to improve full year pre-tax profit from £2.9m to £4.4m and a total dividend of 7.5p a share is expected.
NWF (NWF) says the warm summer has hit demand for heating oil and there has been increased competition in fuels. There has been increased demand for feed and the food distribution business is trading in line with expectations.
Health monitoring equipment supplier Deltex Medical (DEMG) is adapting its strategy in order to grow revenues and generate cash from existing customers. Costs are also being reduced. Probe revenues fell in the first half of 2018 due to delayed orders in the US and France. Overall, interim revenues fell from £2.88m to £2.33m, but the operating loss was only slightly higher at £1.14m. There is just over £1m in the bank.
Fishing Republic (FISH) has appointed Daniel Quinn as chief executive. He has previously worked at Go Outdoors and Tesco. That could point to a broadening of the range of products that will be sold by the fishing tackle retailer. Interim revenues fell from £4.1m to £3.4m, while the loss was £2.5m, which includes stock write downs and other one-off costs. Five outlets have been closed.
Trinity Exploration (TRIN) increased its oil and gas production in the first half and also achieved higher prices. The Trinidad-focused oil and gas producer increased interim revenues by 49% to $30.1m and generated $5m of cash from operating activities. There was net cash of $19m at the end of June 2018.
Gama Aviation (GMAA) increased interim revenues by 3% to $104.6m, with a lower contribution from the ground maintenance activities offset by higher revenues from the air services operations. A better second half should enable Gama to increase its full year pre-tax profit from $17.1m to $19.9m.
Oil and gas producer and explorer Cabot Energy (CAB) increased its interim revenues from $1.8m to $7.5m thanks to higher production in Canada, where Cabot took full control earlier this year. Even so, there was still a $4.2m first half loss, mainly due to exceptional costs, following the installing of a new management team. Management is in talks with potential farm-in partners for some of its Italian assets. That would enable Cabot to focus its investment in Canada. There was $6.2m in the bank at the end of June 2018, although some of that cash could be needed to complete the purchase of an Italian producing asset.
Immupharma (IMM) had £9m in the bank at the end of June 2018. The group is collaborating with Icanthera, which will in-licence the Nucant cancer programme, which has completed two phase 1 trials. Immupharma is also seeking to divest its subsidiary Ureka, while retaining an interest in the potential of the operations. Even though the results of the Lupuzor phase III trial were disappointing, a deal has been signed for Lupuzor to be provided via a Managed Access Programme. An open label extension study for Lupuzor will report by next summer.
Park Group (PKG) says that it has grown its cash balances and both the consumer and corporate businesses are trading well. Park is on course for a full year profit of £13.6m.
Active Energy (AEG) reported a higher interim loss. This was a period when $1.32m was spent on the development of the CoalSwitch plant. Along with its partner, Active has submitted an EU grant application for the SuperFuel coal slurry recovery technology and a decision should be made before the end of the year. There is also optimism about gaining a Crown Timber Licence for Newfoundland and Labrador.
Destiny Pharma (DEST) still has cash of £15.1m even though costs were increased in the first half. Investment in trials means that cash could fall to £10m by the end of the year. The phase I safety study for the use of XF-73 to prevent surgical infections should be completed by the end of this year and a phase IIb trial could commence early next year. A second formulation of XF-73 is being developed for dermal infections and diabetic foot ulcers in particular.
Midatech Pharma (MTPH) plans to sell its US subsidiary, which it acquired in 2015 when it gained its Nasdaq listing. Midatech will receive an initial $13m for the cancer care products supplier. The cash will be used for the research and development operations and paying off the loan from MidCap.
Bosch has invested £9m in fuel cell technology developer Ceres Power Holdings (CWR) in return for a 4.4% stake. Weichai Power will invest a further £1m to maintain its 10% stake.
There was a 17% fall in gold processed by Goldplat (GDP) in the year to June 2018, but sales only dipped from 40,285 ounces to 39,400 ounces. Revenues increased by 7% to £33.8m. The Kilimapesa gold mine continues to disappoint and lose money. A lower contribution from the Ghana processing operations and a bad debt were the main reasons behind the fall in pre-tax profit from £2.84m to £1.79m. Goldplat is seeking other mine investments, not necessarily in Africa. There was £1.54m in the bank.
Veltyco (VLTY) has managed to reduce its receivables but the were still €12.6m at the end of June 2018. Revenues for the previous six months were €8.9m. Net cash was €1m. Veltyco will launch its own financial trading brand in the fourth quarter.
Stride Gaming (STR) continues to be hit by the stagnation of the online bingo market but the decline in pre-tax profit is set to be in line with expectations. In the year to August 2019, pre-tax profit is expected to fall further from £14.2m to £13.8m. There will be a £4m provision for the recent fine from the UK gambling authorities.
Strategic Minerals (SML) reported a jump in interim pre-tax profit from $158,000 to $2.69m, but this did not come through in cash during the period. That is because £2.46m of the profit came from a gain based on the payment for the Leigh Creek copper mine below its asset value.
MAIN MARKET
Hemogenyx Pharma (HEMO) is moving towards the point where it can submit an IND application to the FDA for CDX antibodies. There is initial data that CDX antibodies can attack and eliminate Acute Myelogenous Leukemia in vitro. Hemogenyx already has an agreement with a global pharma company for this technology. Northland has been appointed as broker.
World Trade Systems (WTS) reported a drop in interim revenues from £10.1m to £6.3m and it has fallen into loss. Trading has been tough for the health food subsidiary. This is set to continue. Trading in the shares has been suspended for more than a decade and the board says that is working towards a resumption of trading on the premium segment of the Main Market.
WideCells Group (WDC) has gained financing of up to £2.7m from the European High Growth Opportunities Securitization Fund. The facility is convertible into shares and has warrants attached. The cash will be invested in the stem cell storage and insurance operations. The BabyCells stem cell storage service has been launched. Group revenues remain modest and WideCells made an interim loss of more than £2m. There was £1.73m in the bank at the end of June, offset by debt of £1.17m.
Investment company London Financial and Investment Group (LFI) has maintained its NAV at 65.4p a share, despite a decline in value of its stake in Finsbury Food (FIF), and the total dividend has been edged up to 1.15p a share. The share price is 42.5p.
Standard list shell Blockchain Worldwide (BLOC) still had £1.4m in the bank at the end of June 2018 following its decision to change its strategy from telecoms to blockchain acquisitions. Management is analysing potential acquisitions.
Andrew Hore