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Quoted Micro 10 July 2017
NEX EXCHANGE
Coinsilium Group Ltd (COIN) has sold its remaining stake in nanopayments software and blockchain company SatoshiPay to AIM-quoted Blue Star Capital (BLU) for €725,000 (£650,000), which has been raised through a placing at 0.2p a share. Blue Star Capital owns 31.1% of SatoshiPay. Blue Star Capital has granted Coinsilium 85 million warrants, of which 42.5 million are exercisable at 0.6p and 42.5 million at 0.8p. Coinsilium has made a gain of 362.6% on its initial SatoshiPay investment in less than two years, even before any longer-term upside from the warrants.
Via Developments (VIA1) has secured an exclusivity agreement to acquire land in Luton, Bedfordshire for £8.25m. The residential development site has planning permission for 200 apartments. A non-refundable deposit of £50,000 has been paid.
Capital for Colleagues (CFCP) has invested £400,000 in Employee Owners Group Ltd, whose main business is timber frame buildings supplier Carpenter Oak, in return for a 30% stake. The cash will be used to grow the business which currently supplies around 90 frames a year.
First Sentinel (FSEN) has raised £700,000 at 11p a share and made three investments, including £35,000 at 7p a share in fellow NEX-quoted company Milamber Ventures (MLVP). The two firms are already working on an investor event at the Century Club, Shaftesbury Avenue in London on 11 July. First Sentinel plans to sell the Milamber shares in the market. First Sentinel has also invested $300,000 in a 13%, one year loan note for Red Rock Resources (RRR) with two year warrants exercisable at 2.2p a share, compared with a market price of 0.75p. The third investment is in newly floated AIM copper mining company Phoenix Global Mining (PGM), where First Sentinel invested £81,000 at the placing price of 4p a share.
Blockchain investments company Kryptonite 1 (KR1) has raised £750,000 at 2p a share. Chinese medicines firm MiLOC Group Ltd (ML.P) has raised £99,000 at 28.5p a share.
AIM
Premier Technical Services Group (PTSG) is acquiring Brooke Edge Industrial Chimneys Ltd for an initial £14m, plus £1m in acquisition costs, and the building services provider has raised £15m in a placing at 120p a share. There is deferred consideration of £6m payable in three yearly instalments, which fits with the owners staying on with the business for at least three years. The acquisition made a profit of £2.1m on revenues of £10.6m last year. This consolidates Premier’s position in lightning protection services, while specialist earthing and surge protection will be added to the group’s range of services. Although the acquired business has similar margins to Premier, it has lower margins than the same businesses already owned by Premier. This means that continued growth in revenues could be complemented by improvements in margins providing even faster profit growth. According to Numis, he acquisition will enhance earnings per share by 5% to 8.7p in 2017 and 12% to 9.2p in 2018.
Blur Group (BLUR) has managed to raise £1.7m at 1.75p a share in an oversubscribed placing that more than trebles the number of shares in issue. There is one warrant for every four shares with an exercise price of 3.5p. Robert Keith has increased his stake to 25% following the placing. The need for the cash is reflected in the low issue price, which is more than 40% below the all time low market price.
Superyacht painting and maintenance services provider GYG (GYG) joined AIM on 5 July and the share price has already risen from 100p to 120p. GYG raised £6.9m before expenses.
Thor Mining (THR) will start a drill programme for the Pilot Mountain tungsten project in August. Thor expects the results in the near future from a 50 hole drilling programme on the Dundas gold project in Western Australia. Further opportunities are being assessed.
Portmeirion Group (PMP) says that its sales were 16% higher in the first half of 2017 but excluding home fragrance products manufacturer Wax Lyrical, which was acquired in May 2016, the sales are 3% higher due to a boost from sterling weakness. Churchill China (CHH) continues to grow it exports and this has been helped by weaker sterling comparatives in the first half of 2017.
Walker Greenbank (WGB) has received its final insurance payment of £2.4m relating to the flood of its fabric printing factory at the end of 2015. This takes the total payment to £19.3m.
Home improvement products supplier entu (UK) (ENTU) is undertaking a strategic review. There are already plans to cut costs and improve efficiency but entu needs to secure long-term financing to improve the balance sheet. There could also be disposals of businesses.
Sula Iron & Gold (SULA) has completed six holes of the phase 3 drilling at Sanama Hill at the Ferensola gold project in Sierra Leone. So far, 2,000 metres out of a total of 5,000 metres of drilling has been completed. Part of the drilling will include further exploration of the new southern target. The assay results will be available at the end of July.
Veltyco Group (VLTY) says that first half trading is significantly ahead of market expectations. This is not the first time that Veltyco has beaten expectations and even before this the full year pre-tax profit was expected to jump from €1.74m to €4.62m.
TechFinancials Inc (TECH) expects to make a first half loss. Senior management has taken a 20% pay cut. There is still $5.8m in the bank.
Safestay (SSTY) has acquired second hostel in Barcelona for €2m. Safestay has eleven hostels and acquisitions have gathered pace following a £12.6m sale and leaseback deal.
MAIN MARKET
Share trading will commence on 12 July in standard list shell Rockpool Acquisitions, which is seeking to acquire a Northern Ireland-based company. Rockpool is raising £1.085m at 10p a share, having previously issued 1.875 million shares at 8p each.
RockRose Energy (RRE) has raised £8m at 150p a share and it continues to progress the acquisition of oil and gas assets.
Gresham Technologies (GHT) says that revenues will be 26% higher in the first half of 2017. Eight new Clareti Transaction Control software clients have been signed up in the first half. Net cash is £7.7m.
Quarto Group Inc (QRT) has sold its New Zealand business, which was the last non-publishing business owned by the group. Quarto will receive $600,000 over two years plus 50% of debtor receipts for the next year. Quarto is also entitled to 15% of pre-interest profit for three years.
Andrew Hore
Quoted Micro 22 May 2017
NEX EXCHANGE
London and south east England residential property developer St Mark Homes (SMAP) says it will in the immediate future focus on homes for sale for less than £600,000, because this is the London help to buy limit. In 2016, revenues fell from £3.1m to £1.34m but the unchanged contribution from joint ventures and a release of negative goodwill of £150,000 – a non-cash item – meant that pre-tax profit improved from £549,000 to £652,000. There is still negative goodwill of £137,000 on the balance sheet which is likely to boost a future financial year. A lower tax charge helped earnings per share to rise from 14.8p to 16.6p. Total dividends were 11% higher at 5p a share. There was a cash outflow from operations in the period. The NAV is £5.8m, following a share issue that raised £690,000 net of costs via an open offer to existing shareholders. That is 131p a share. Finance director Sean Ryan acquired 4,912 shares at an average price of 94p each.
Markets operator WMC Retail Partners (WELL) benefitted from an increased valuation of its Luton market but trading was down on the previous year. In 2016, revenues dipped from £4.31m to £4.23m, including £100,000 of consultancy revenues, and a pre-tax profit of £13,000 was turned into a £58,000 loss. WMC is on course to reopen its Cornish site under the name Cornucopia in July.
Property developer Formation Group (FRM) moved back into profit at the interim stage based on continuing operations. Revenues doubled from £10.2m to £20.2m, while an operating loss of £84,000 was turned into a profit of £48,000. The corresponding period also included a £1.08m write-back of loans secured on past properties. There was £1.58m in the bank at the end of February 2017. The NAV was £10.4m.
Block Energy (BLOK) says that Schlumberger has completed the acquisition of three production sharIng contracts in the Republic of Georgia that are near to Bock’s own interests. This indicates the interest in the region. Roger McMechan has been appointed as technical manager for Block’s interests.
Investment company Early Equity (EEQP) increased its interim loss from £46,000 to £67,000. The NAV fell from £770,000 to £639,000 at the end of February 2017. The value of investments in BWA Group and Alpha Prospects declined and the investment in Devilfish Poker was written off, although it is hoped that there could eventually some value to the shareholding. Yicom Global, a healthcare products supplier primarily focused on China, has been increasing its number of sales agents and sales.
Coinsilium Group Ltd (COIN) says that nano-payments company SatoshiPay has linked up with PayPal so that 200 million users could potentially use its service. Coinsilium has a 12.1% stake in SatoshiPay.
Milamber Ventures (MLVP) has paid £75,000 for a 15% in Essential Learning, which provides apprenticeship training. The UK Apprenticeship Levy is expected to generate £2.8bn to be invested in training. In the nine months to April 2016, revenues were £616,000 and lost nearly £30,000. Share placings at 16p a share and 20p a share raised a total of £75,000.
Wheelsure Holdings (WHLP) has raised £500,000 at 1p a share and it hopes to raise a further £50,000. Management says that the economic climate has delayed sales of its Tracksure rail safety components and Wheelsure is short of cash to develop the business. The cash is needed for marketing, product development and patent protection. There are trials of products in process. Wheelsure is focusing on generating more sales from existing customers while targeting longer-term sales from new customers.
Karoo Energy (KEP) has raised £465,000 at 3p a share. These investors will receive a warrant exercisable at 6p a share for each share they subscribed for. The warrants last for 36 months. The cash will be used for shale gas exploration in Botswana.
AIM
A strong end to the financial year means that Bilby (BILB) expects to report EBITDA of at least £3.6m, compared with a forecast of £3m. The building services provider says that demand was strong at the end of the financial year with some work starting earlier than expected. There is a cash balance of £2.5m. The figures for the year to March 2017 will be reported before the end of June.
Mortice (MORT) has sparked another profit forecast upgrade following a trading statement. House broker finnCap has increased its 2016-17 pre-tax profit forecast from $4.3m to $5m and next year’s forecast has been raised from $6.2m to $7m. Revenues are better than expected and costs have been kept under control. Net debt was $13.6m at the end of March 2017. The facilities management and security divisions both generated much higher revenues.
Gemfields (GEM) has received an unsolicited bid from 47.1% shareholder Pallinghurst Resources. The offer is not generous. Pallinghurst is offering 1.91 of its shares for each Gemfields share. That is equivalent to 38.5p a share or a total value of £211.5m.
Veltyco Group (VLTY) did even better than expected in 2016. Revenues were 7% ahead of forecast at €6.1m. Underlying pre-tax profit was €1.74m and Northland forecasts a 2017 profit of €4.27m, helped by recent acquisitions. The online gaming marketing business has started 2017 strongly.
RNA therapeutics developer Silence Therapeutics (SLN) has gained a European Patent Office grant for its chemical modification technology and expects to use this patent to generate revenues from specific medicines that are already undergoing clinical trials.
A recovery in oil and gas demand has helped Hardide (HDD) in the first half. Revenues increased by 59% to £1.51m. The underlying operating loss fell from £1.02m to £720,000. Production is building up at the new US facility. Sales are yet to come through from the approvals already given by Airbus Group. A $100,000 order has been received from General Electric.
LightwaveRF (LWRF) reported a slightly reduced interim loss on revenues that grew from £804,000 to £1.17m. The loss fell from £384,000 to £333,000. The home automation business has developed technology and it needs to generate higher sales in order to move into profit. A partnership with Google in the voice control area has propelled the share price upwards.
ImmuPharma (IMM) says that the latest clinical trial results show that Lupuzor, a potential treatment for Lupus, has a robust safety profile. The phase III trial of 200 patients has been going on for 52 weeks and the full results should be available in the first quarter of 2018.
Tiso Blackstar Group SE (TBGR) is selling its 22.9% stake in industrial holding company KTH back to the company. The payment of around £86m will be paid over 19 months with £7m due before the end of 2017 and the rest by the end of 2018. Tiso Blackstar will repay its debt of £23m and a special dividend of £2.3m. The rest of the cash will be reinvested in media investments. There are plans to move the listing in South Africa from AltX to the Main Market. The company is also moving its registered office from Malta to the UK.
Management has announced a potential bid for recruitment company InterQuest Group (ITQ) but the independent directors are not impressed. Chisbridge Ltd is offering 42- a share. The two independent directors say the offer undervalues the company.
Brave Bison (BBSN) has approached Zinc Media (ZIN) and merger discussions are underway. Herald Investments has stakes in both companies.
Edenville Energy (EDL), which operates the Rukwa coal project in Tanzania, has signed a letter of intent to supply 1,000t of coal/month and this could increase to 7,000t/month. This should hopefully be followed by a formal coal supply agreement so that deliveries can start in July.
Tissue Regenix (TRX) is in talks to acquire US-based regenerative medicine company CellRight Technologies.
MAIN MARKET
Flying Brands Ltd (FBDU) says that the prospectus relating to the acquisition of kidney stone analysis company Stone Checker Software has been approved by the authorities. A placing has raised £550,000 at 3p a share.
Andrew Hore
Quoted Micro 15 May 2017
NEX EXCHANGE
Newbury Racecourse (NYR) increased its revenues by 4% to £16.9m in 2016. Underlying trading profit was 8% ahead at £740,000 but there was also a £19.4m gain on the sale of land for housebuilding partly offset by £3.45m impairment charge. The NAV was £44.4m, which is around double the company’s market value. Net cash is £5.4m. The redevelopment of the racecourse continues with the latest phase due to be completed next year.
Good Energy Group (GOOD) has launched a corporate bond. It wants to raise £10m but could raise the subscription level to £20m. Existing bond holders can roll over some or all of their investment into the new bonds. The bonds have a coupon of 4.75% or 5% for customers.
Via Developments (VIA1) has sold all 26 apartments in Napier House in Luton. Deposits of £394,000 and £52,000 of non-refundable reservations have been received. The project should be completed in the first quarter of 2018.
AfriAg Global (AFRI) continues to seek acquisitions in the agricultural logistics sector. In 2016, revenues grew from £1.98m to £3.04m and the loss fell from £96,000 to £9,000. Directors’ fees were reduced from £108,000 to £19,000. The 40%-owned AfriAg (Pty) increased its revenues by 91% to £11.7m but its reported profit dipped from £359,000 to £104,000.
Walls & Futures REIT (WAFR) has completed its first supported housing sector investment. It has bought a grade two listed building in Stroud for £475,000. There will be further investment in improving the property over the next four months. The property will then be let on a 25 year lease to a UK care provider with rents adjusted each year by inflation.
Capital for Colleagues (CFCP) has invested a further £100,000 in space software and hardware developer Bright Ascension. The initial investment was £150,000 and Capital for Colleagues holds 250,000 A shares. The cash will be used for product development and building up the company’s sales infrastructure.
Anna Halpern-Lande, a cleantech sector expert, has joined the board of Milamber Ventures (MLVP). Two new partners have been appointed. Executive chairman Andy Hasoon has converted £50,000 of his director loan into 312,500 shares at 16p each. Two other individuals have taken shares for fees.
Coinsilium Group Ltd (COIN) has invested $75,000 (£60,000) in Coin-Dash, which is developing a social trading platform for cryptocurrency investors. Coinsilium also has an entitlement to an undisclosed number of Coindash crypto tokens.
MiLOC Group Ltd (ML.P) has raised £276,000 at 28.5p a share from four investors. NQ Minerals (NQMI) has raised a further £230,000 for working capital. Valiant Investments (VALP) has raised £22,000 at 0.1p a share, while 84.7%-owned apps developer Flamethrower has paid $25,000 for advertising revenues generating Minecraft Command website.
AIM
TyraTech Inc (TYR/TYRU) is splitting itself into two businesses so that they can each raise finance to accelerate growth. The separation should be complete by the end of the year. TyraTech used up $2.2m of cash in 2016 leaving it with $1.8m, thanks to cash management in the second half. Allenby expects cash to fall to $700,000 by the end of 2017 but in reality management would hope to have raised money for the two businesses before that time. Marketing spending is required to grow the human health business while further product development investment is required by the animal health business.
Musical instruments retailer Gear4Music (G4M) is increasing its market share in Europe. In the year to February 2017, revenues grew from £35.5m to £56.1m and pre-tax profit jumped from £600,000 to £2.7m. A new head office has been acquired for £5.3m and a German distribution centre is being opened.
Cosmetics supplier Warpaint London (W7L) has done particularly well since it joined AIM and its figures were better than expected leading to an upgrade for this year. In 2016, Warpaint made a pre-tax profit of £6.7m on revenues of £27m. A 2017 profit of £7.6m is forecast. Growth is coming from the UK and internationally with US revenues starting to build up.
RedstoneConnect (REDS) has raised £6.5m at 1.5p a share and £1.4m of this will be spent on systems integrator acquiring Anders + Kern. This will help the group to sell its OneSpace smart buildings software. A one-for-100 share consolidation is planned.
Motor dealer Vertu Motors (VTU) improved its full year pre-tax profit from £26m to £29.8m and its NAV is 62.3p a share. The share price is trading at a discount to NAV of one-fifth. Aftersales revenues continue to grow and used vehicle sales were strong. The new car market has declined but trading in March and April is in line with expectations.
Cambria Automotive (CAMB) has also performed well even though new and used vehicle volumes declined. Acquisitions helped its revenues to grow by 11% while its pre-tax profit was more than one-fifth higher at £5.6m. The full year profit forecast has been edged up to £11.2m.
The proposed energy price cap has hampered Flowgroup (FLOW) in its attempt to sell its energy business. It is still in talks but appears more likely to require to raise an additional £20m. This would be highly dilutive because it would be at 1.5p a share plus convertible securities. Losses will continue for the next couple of years and Flow is reducing its exposure to the microCHP business.
Arian Silver Corporation (AGQ) has completed initial sampling at its Mexican Salar project and this confirms the presence of lithium. Further tests are required to fully assess the mineralisation.
Savannah Resources (SAV) has lodged the Environmental Impact Assessment for the Mahab 4 copper mine development, having already done this for the Maqail South deposit. Savannah owns 65% of the company that has the licence for the block that includes Mahab 4. The approval process is expected to take three months. An economic study should be completed by July.
Active Energy (AEG) is reducing its exposure to Ukraine and dividing its operations into Advanced Biomass Solutions, which will own the CoalSwitch technology, and Timberlands International for the timber asset management operations. Supplying woodchip from Ukraine to Turkish fibreboard manufacturers is the main revenue generator but exposure to Ukraine has held back the share price. The company’s former chief operating officer may make an offer for the Ukrainian operations.
Draganfly Investments (DRG) has raised £500,000 at 0.5p a share. Pelamis Investments Ltd owns 11.26%.
MAIN MARKET
Waterman Group (WTM) has recommended a 140p a share bid from CTI Technology, which has already acquired 30%. This means that the £43m bid is mandatory. CTI is one of the largest consulting engineers in Japan.
A strong performance in South Korea has fuelled a strong performance from window components manufacturer Titon (TON). In the six months to March 2017, revenues were 29% higher at £14m, while pre-tax profit was 61% higher at £1.18m. The dividend was increased by 20% to 1.5p a share. Net cash is £2.71m.
Storage and wireless semiconductors developer CML Microsystems (CML) says full year trading was ahead of expectations. Revenues grew by one-fifth to £27.6m – organic growth is estimated to be 16%. Pre-tax profit was £4.2m – 5% higher than forecast. There was £12.4m in the bank t the end of the financial year.
World Trade Systems (WTS) has appointed John Hoskinson as a non-executive director. He has experience of mining, energy, property and services sectors. Clio Lee has stepped down from the board. Trading in WTS shares continues to be suspended.
UNQUOTED
Richard Griffiths and Blake Holdings have acquired 11.2% of former AIM-quoted investment company Sarossa for £519,500 (1p a share). This takes the concert party’s stake to 51.9% so it has to make a mandatory bid at 1p a share but that is well below the most recent asset value. At the end of 2016, the NAV was £11.3m or 2.4p a share. That included £3.73m of cash.
Andrew Hore
Quoted Micro 3 April 2017
NEX EXCHANGE
Hearing equipment supplier DHAIS (DHAP) has reduced the number of stores it operates and that is why its interim revenues fell by 18% to £4.16m but it did move back into profit before notional interest charges. The company continues to reduce its exposure to the mobility sector and concentrate on the supply of hearing aids.
Capital for Colleagues (CFCP) says that its NAV fell to £4.19m (43.5p a share) at the end of February 2016. The company plans to raise £2m at 42p a share.
Black Sea Property (BSP) has pulled out of the deal to acquire development land in Varna because it would not offer a suitable return even though the seller offered amended terms.
Etaireia Investments (ETIP) has completed the acquisition of the company that owns 89 Dalrymple Street, Girvan. The property was valued at £60,000 and the purchase price has been satisfied by £35,000 in cash and 25 million shares at 0.1p each. The cash payment is deferred for 12 months. A new tenant has signed a ten year lease at an initial rent of £12,000 a year.
Trading in the consolidated shares of Ace Liberty & Stone (ALSP) commences on 3 April. Twenty five shares have been consolidated into one new share.
Barney Battles has withdrawn his request for a general meeting at Milamber Ventures (MLVP).
AIM
Staunton Holdings says that it has no intention of increasing its 300p a share offer for FIH (FIH). Rival suitor Dolphin Fund says that it may be willing to offer 333.3p a share in cash but it still wants to discuss its plans with the independent directors.
Fairpoint (FRP) managed to make a small profit in the second half and full year profit was £4.9m, down from £10.5m in 2015. That is before £11.8m of restructuring charges and write-downs. Net debt was £19.9m at the end of 2016 and since then a medico-legal business has been sold for £1.2m. Bank facilities last until May 2019. There will be no dividend. Legal services revenues are expected to fall by 15% in 2017 and then start to recover in 2018. There will be £5m of annual cost savings showing through in the second half of 2017.
Premier African Minerals (PREM) successfully raised £2m at 0.5p a share via PrimaryBid.com. Premier directors Michael Foster and John Stalker have converted £30,000 of fees into six million shares at 0.5p each.
Connemara Mining Company (CON) has acquired five new prospecting licences in Ireland and two of the licences are in areas known for zinc-lead mineralisation – Tonduff and Derrykean. The licences are all north east of the Galmoy and Lisheen mines.
CloudCall (CALL) had 16,200 users by the end of 2016 and they are generating £31/month each. Revenues grew 48% to £3.3m but the operating loss increased from £3.7m to £4.5m. Recurring revenues continue to grow and February was the best ever month. There was £3.2m in the bank at the end of 2016.
Patient monitoring equipment supplier LiDCo (LID) reported full year figures in line with expectations but the next two financial years will provide indications of how well the company’s new strategy is working. The plan is to add high usage accounts in North America following the launch of a new monitor. There will be a significant increase in sales and marketing costs this year and the benefits will not show through until later in the year. This is why LiDCo is expected to slip back into loss before moving into profit in 2018-19.
Evgen Pharma (EVG) has been granted another patent relating to SFX-01. The patent “covers a method of isolation and stabilisation of sulforaphane from a natural source” and lasts until May 2033.
Savannah Resources (SAV) expects to start mining at its Oman copper projects before the end of this year. Ministerial approvals are still required to get a mining licence. Savannah has also established a resource of 4.4bt at a grade of 3.9% total heavy minerals at the Mutamba project in Mozambique.
MAIN MARKET
Path Investments (PATH) is the new name for former AIM company Niche Group. Path joined the standard list on 30 March and it raised £1.4m at 1p a share. The strategy is to acquire production and near-production assets in the oil and gas sector.
Bluebird Merchant Ventures (BMV) has turned its attention to South Korea. Southern Gold Australia has a number of tenements which have abandoned mines on them and there is scope to reopen them. Bluebird intends to earn 50% stakes in individual mines in return for the investment of $500,000. Two former mines have already been chosen – Taechang and Gubong. The plan is to prove resources and then move the mines towards production. Bluebird’s existing assets in the Philippines have been put on hold until the market is more favourable.
Dukemount Capital (DKE) joined the standard list on 29 March. The share price ended the week at 0.45p (0.4p/0.5p), which values the company at £1.5m. A dividend should be paid within two years and the target yield is 10%. Dukemount plans to do this by acquiring, developing and managing property assets. Dukemount will then create long-dated inflation-linked assets which will be attractive to institutional investors.
Stewart & Wight (STE) has bought a retail property in Middlesbrough for £620,000. A ten year lease was signed by HK Foods last September providing annual rent of £45,000. An upward only rent review is due after five years.
Andrew Hore
Quoted Micro 13 March 2017
NEX EXCHANGE
Blockchain technology investment company Coinsilium Group Ltd (COIN) has raised £188,000 at 1p a share with the cash coming from directors and existing shareholders. The valuations of Factom and SatoshiPay have increased since the beginning of the year. Potential new commercial opportunities are being reviewed. Coinsilium is also raising its own profile so that investors’ are aware of the potential investment.
Middle East-focused investment vehicle Indigo Holdings (INGO) has announced its second investment, which is in Net Tejarat Ahoura, which operates an Iranian online classifieds marketplace. A stake of 1.09% was assigned to Indigo by Turquoise Group, which owns 32.1% of Indigo, in return for assuming the commitment to provide an interest free loan of €376,000 (£320,000). Related parties own 14.1% of Net Tejarat. There was net cash of £818,000 at the time of flotation and Indigo previously spent €176,800 (£150,000) on a 5% stake in Iranian car ride sharing app Carvanro.
Technology incubator Milamber Ventures (MLVP) has entered discussions with Barney Battles and he has suspended his general meeting requisition. The one million shares issued to acquire League of Angels has been cancelled because the transaction was not completed. Milamber has added six portfolio companies taking the total companies that it works with to 25. Milamber is providing funding support to all six as well as strategic advice and/or business planning to some. Milamber has raised just over £9,000 from an issue of shares to its executive chairman Andrew Hasoon at 12.5p a share.
MetalNRG (MNRG) has appointed Paul Johnson as chief executive. He was already on the board as a non-executive director and he is also a non-executive of Thor Mining (THR). The management is keen to attract more trading in the shares by taking advantage of the potential opportunities in the resources sector.
Property investment company Ace Liberty & Stone (ALSP) plans to consolidate 25 existing shares into one new share so it is no longer perceived as a penny share. The shareholder meeting will be held on 31 March. Kryptonite1 (KR1) is also consolidating its shares. Nineteen shares will be consolidated into one new shares with the shareholder meeting being held on 3 April.
Western Selection (WESP) has sold 130,000 shares in AIM-quoted toiletries and cosmetics supplier Swallowfield (SWL) for 320p each. Western Selection still owns 1.5 million shares in Swallowfield, where the share price has doubled over the past nine months. The recent interims showed a quadrupling of underlying operating profit of £2.54m and a more than doubled interim dividend from 0.8p a share to 1.7p a share – the shares go ex-dividend on 4 May.
AIM
Plant Impact (PIM) continues to increase its Veritas sales to soybean farmers in Brazil and Paraguay and Bolivia are the next markets it is trying to break into. Another treatment, Fortalis, is being launched in Argentina and the US. In the six months to January 2017, revenues increased from £4.22m to £4.91m, helped by currency movements, with Brazil still dominating sales. Higher sales and marketing and R&D costs meant that there was a loss of £333,000, compared with a pre-tax profit of £541,000. There is £6.03m in the bank which is enough to cover cash outflows for the next year or so.
Strategic Minerals (SML) says that drilling will start by the end of March at the 50%-owned Redmoor tin/tungsten project in Cornwall. The first phase of drilling is 13 holes and the second is 10 holes with potential for six more. This drilling programme is fully funded. On top of this, significant cobalt mineralisation has been identified at Hanns Camp in Western Australia. The company has raised £50,000 via the exercise of warrants at 0.6p a share by Cornhill Capital. There was $1.2m in the bank at the end of 2016 but this was before the £844,000 payment to take the 50% stake in Redmoor.
Remote meetings technology provider LoopUp (LOOP) sharply reduced its loss in 2016 and the cash raised in last year’s flotation should reduce interest costs which were the reason there was a loss in 2016. There was a swing from an operating loss of £353,000 to a £398,000 operating profit in 2016. There is net cash of £2.24m, against net debt of £7.3m at the end of 2015. There was cash generated from operations of £3.29m but that was not enough to cover capital expenditure, which was predominantly capitalised product development investment. There are £12.6m of accumulated tax losses.
Advanced materials developer Versarien (VRS) raised £1.5m at 15p a share via PrimaryBid, having initially tried to raise £1m. All the applications were satisfied. Henderson and Miton each subscribed for 1.33 million shares. The cash will be used to scale up graphene manufacturing facilities and finance the marketing of the Nanene brand.
The People’s Operator (TPOP) is raising a further £1.58m at 8p a share and every two shares will have a warrant attached that is exercisable at 15p a share. The recent fundraisings were at 5p a share. The mobile virtual network operator has confirmed that 2016 revenues were £3.6m and there has been strong growth in US revenues in the first two months of this year. Management has negotiated much better terms with its network providers in the UK and US.
Immupharma (IMM) has raised £4.1m at 52p a share having initially asked for £3m. The drug discovery company has brought new institutions to its shareholder list. Immupharma is negotiating with potential partners for lupus treatment Lupuzor, which is in a phase III trial and the cash will strengthen the balance sheet as well as providing investment in other treatments.
Palm oil waste products-based biogas power generation plants operator Green & Smart Holdings (GSH) says that its figures for the year to September 2016 were in line with expectations but there have been delays in new plants. House broker SP Angel had expected half of forecast 2016-17 gross profit to come from electricity generated by these four projects.
The sale of the broadcast equipment division of Pebble Beach Systems (PEB), formerly Vislink, to xG Technology Inc is not going smoothly. Instead of paying the next part of the deferred consideration xG has taken on responsibility to pay $1.6m of trade creditors. This leaves $4.9m owed but xG says that this payment will be dependent on Pebble’s performance of its contractual obligations. Until outstanding liabilities are clarified xG says that it will not pay any more deferred consideration. The buyer claims that “numerous breaches of contract” have occurred. It is difficult to say whether this is just a negotiating ploy.
Ascent Resources (AST) expects to start untreated hydrated gas production from Pg-10 in the Petisovci gas project in Slovenia in early April. This will provide initial revenues prior to the sale of gas to Croatia later in the summer. Ascent has decided not to lease a dehydration plant and instead it will refurbish the existing plant on the site.
Thor Mining (THR) has reported positive drilling news at the Pilot Mountain tungsten project in Nevada and plans a third drill hole. The second drill hole has intersected 51 metres of mineralisation. The drill hole sample assays should be analysed by the end of April. The third hole is 25 metres to the east of the second hole. Paul Johnson (see MetalNRG) has acquired 500,000 shares at 1.13p each, taking his stake above 2%.
Sunrise Resources (SRES) has raised £250,000 at 0.1p a share. The cash will be used to finance projects in Nevada.
MAIN MARKET
Shares in Ocelot Partners Ltd (OLOT) commence trading on the standard list on 13 March. The cash shell has raised $417.7m at $10 a share. The proposed acquisition is expected to be involved with the European technology, media or telecoms sectors. Management has been involved with other standard list shells, including Nomad Holdings, which acquired frozen foods businesses including Findus.
BATM (BVC) has weathered a difficult 2016 and is in good shape to improve its performance in 2017. A delayed contract hit the network and cyber division but this should be delivered this year. Strong diagnostics activity offset the weaker waste treatment business, enabling the bio-medical division to report flat revenues. finnCap expects the 2016 loss of $3.3m to be turned into a pre-tax profit of $1.5m this year. There was net cash of $23m at the end of 2016, although around £580,000 has been spent on acquiring Israel-based Zer Laboratories.
Bio-decontamination services provider Bioquell (BQE) reported flat revenues of £26.5m and the underlying pre-tax profit improved from £900,000 to £1.6m. There was a £1.5m charge for board restructuring and write-down of intangible assets. The full benefits of last year’s restructuring will come through in 2017. Having returned £40.8m to shareholders, net cash was £8.8m at the end of 2016.
Oil and gas explorer Aminex (AEX) says that the Ntorya-2 well has been successfully tested and it has confirmed that the area should contain a significant amount of gas but there are production difficulties to overcome. Aminex owns 75% of the Mtwara licence in southern Tanzania. Once a full analysis of technical data is complete Aminex will apply for a 25-year development licence over the area. Joint broker Shore Capital says that it is likely to increase its NAV estimate of 3.9p a share on the back of the news.
Electronic Data Processing (EDP) says the original potential bidder has withdrawn but a different bidder has started talks with the board. There was £6.56m in the bank at the end of February 2017 and EDP will consider returning some cash to shareholders if there is no bid. This could depend on the level of distributable reserves, which could be hit by the next pension scheme revaluation.
Andrew Hore
Quoted Micro 13 February 2017
NEX EXCHANGE
Investment vehicle Indigo Holdings (INGO) is seeking acquisitions in the consumer, financial and technology sectors in the Middle East and it joined NEX on 10 February. An initial 15 million shares were issued at 1p each and in January a further 26.5 million shares were placed at 3p each. The market capitalisation is £1.24m at 3p a share. There was net cash of £818,000 at the time of flotation. Indigo can issue a further 218.5 million shares. There has been one trade of 4,000 shares at 5p each but the bid/offer spread is 3p/5p.
Equatorial Mining & Exploration (EM.P) has signed a conditional option agreement to acquire a Mexican mining and exploration project. The option lasts 90 days and the acquisition will be funded by the issue of £10.4m worth of shares. Equatorial will need to raise at least £2m to finance the Tango project which includes copper, gold and molybdenum interests. This is an area with historic workings. An initial fundraising of £250,000 at 0.00125p a share will finance the current interests in Nigeria. There are plans to consolidate the Equatorial shares on the basis of 0ne new share for 650 shares and then switch to a standard listing.
A new investment in blockchain technology company Factom Inc means that the stake owned by investment company Coinsilium Group Ltd (COIN) has increased by 236.5% since the initial investment. The 1.5678% stake in the developer of audit and accountability tools using blockchain technology is valued at $473,000.
Western Selection (WESP) says that its NAV has increased by 6% to 84p a share in the six months to December 2016 but this had increased to 91p a share by the end of January. Gains have been made on the disposal of shares in Swallowfield (SWL) with some of the cash used to buy shares in Bilby (BILB), which has been hit by a profit warning. The interim dividend has been increased from 1.05p a share to 1.1p a share.
Milamber Ventures (MLVP) has removed Barney Battles from the board but he wants to convene a general meeting to get himself reappointed to the board. Milamber says that there are concerns about the League of Angels business that he sold to the company.
African Potash Ltd (AFPO) has raised £126,000 at 0.045p a share and issued 55.2 million shares to pay liabilities. The new shares account for 22.7% of the enlarged share capital.
FT8 (GFT) is still trying to secure payments from Billyst Holdings, which has defaulted on its agreement to provide monthly payments. This means that FT8 is short of cash.
AIM
Staunton Holdings Ltd has launched a recommended offer of 300p a share for FIH Group (FIH). The deal values the Falkland Islands trader and transportation company at £37.1m. The bidder is controlled by The Rowland Purpose Trust 2001he bid is at a significant premium to the market price prior to the announcement but it is below the level of the share price two years ago. FIH has net cash of nearly £10m. The bid values FIH at 15 times 2015-16 earnings but profit is likely to fall this year making the prospective rating 26 times. When the interim figures were published in November, house broker WH Ireland estimated a sum of the parts valuation of 320p a share but this was subsequently reduced to 300p a share.
Ascent Resources (AST) launched a £3m fundraising via PrimaryBid.com, which closed at 5pm on Sunday 12 January. The offer at 1.85p a share is underwritten. The cash will be spent on the Petisovci project in Slovenia, where there has been positive news on flow rates at Pg-10. Ascent has risen money via PrimaryBid.com a number of times in the past.
Strategic Minerals (SML) has exercised the option to take a 50% stake in the Redmoor tin/tungsten project in Cornwall. The £844,000 payment to take the stake to 50% will provide the joint venture with funds for the 2017 drilling programme. The rights to sell the stockpile of magnetite from the Cobre mine in New Mexico have been renewed for a further 12 months to the end of February 2018 and there is still a possibility to come to agreement over a contract lasting a number of years, which would provide more certainty about future revenues. Strategic Minerals moved into profit in 2016 thanks to strong sales of magnetite and it has enough cash to push ahead with the development of its other interests. Strategic Minerals is also interested in the CARE nickel project in Australia.
Billington (BILN) has confirmed that its 2016 figures will be in line with expectations, which ended had been increased by 26% over the past year. A pre-tax profit of £3.5m is forecast. The structural steel supplier will publish the figures on 21 March.
Thor Mining (THR) says that it should receive the final payment for the disposal of its Spring Hill gold project before the end of February. Heavy snow has delayed the commencement of drilling at Pilot Mountain. The cash received will help to finance the drilling.
TechFinancials Inc (TECH) says that its 2016 figures will be better than expected but the loss of a client (24Option.com) will hit the 2017 figures. The client will end the agreement on 1 April. The 2016 EBITDA of $2.8m is well above the forecast of $1.6m. However, any dividend will be put off until there is more clarity about future trading.
Spend management platform developer blur Group (BLUR) has signed up the first large customer for its 12 month group buyer plan. The subscription is paid upfront which is good for blur’s cash flow. The attraction is the potential cost savings by the customer, which is a law firm, and it could be followed by other large customers signing up for the package which provides access to 65,000 suppliers and covers up to $2m of purchases in a year. There is a higher subscription rate for annual purchases of more than $2m. By focusing on larger customers blur has been able to reduce costs and it has been jettisoning unprofitable small customers. Cash burn has been reduced in each of the past five quarters and 2017 will see the full benefits of the cost cutting. The costs in the fourth quarter of 2016 were 43% down on the fourth quarter of 2016. There was £2m in the bank at the end of 2016. This will not last long if the cash burn is not reduced further.
Monchhichi (MCC), formerly Mercom Capital, is raising £2.1m at 35p a share in order to finance the company’s new investing policy focused on technology, media and internet sectors. Each of the new shares comes with a warrant that is exercisable at 80p a share. Shares have been issued at 40p each to cover £200,000 of professional fees.
Crystal Amber Fund Ltd (CRS) has increased its stake in medical devices developer GI Dyamics Inc from 22.65% to 38.73%. Other shareholders in the developer of the EndoBarrier minimally invasive device for treating type 2 diabetes and obesity, include Johnson & Johnson. EndoBarrier is in use in Europe and other countries outside of the EU but an FDA trial was terminated. More than 3,500 patients have been treated through the placing of a temporary bypass sleeve in the intestine – equivalent to a gastric bypass–type treatment. Although GI is based in Boston, Massachusetts but it is quoted on the ASX. The share price has slumped since GI joined the ASX in 2011 and Crystal Amber believes that this is an opportunity to invest in a treatment for significant clinical need at a depressed valuation.
Pebble Beach Systems (PEB), or Vislink as it was known up until the beginning of February, has warned that its 2016 figures will be even worse than expected. The poor performance of the former Vislink hardware activities is not great surprise and the additional write-offs were obviously required given the price it was sold for. However, the remaining software business has also disappointed, although order levels have been good. That suggests a better 2017. Debt remains high and the £8m deferred payment due in mid-March is important if Pebble Beach is to have anything like a stable financial position. Kestrel still believes in the business and it has taken its stake to 14.4%.
React Energy has changed its name to EQTEC (EQT) following the issue of shares to EBIOSS Energy taking its stake to 51%. The share issue covers the €5.15m debt that was due from 50.02%-owned subsidiary Newry Biomass. The 5.53p issue price was a premium to the market price at the time the deal was announced but it subsequently rose above the issue price. Newry should be on course to produce electricity by March 2018. The main revenue generating asset is a wind turbine in County Cork.
Mattioli Woods (MTW) has acquired a 49% stake in profitable small company-focused fund manager Amati Global Investors for £3.33m in cash and shares and has an option, lasting two years from February 2019, to buy the other 51% for cash and shares. The wealth management and employee benefits business reported interim earnings per share nearly one-quarter higher at 11.7p and an interim dividend per share 22% higher at 4.7p. Net cash was £22.6m at the end of November 2016.
PowerHouse Energy Group (PHE) has signed a memorandum of understanding with Peel Environmental to develop and operate an energy from waste plant at Peel subsidiary Protos’ Chester facility. This would be PowerHouse’s first commercial project and Peel has a number of other potential sites if this is successful. The deal is a positive result of the previously announced joint development agreement with Waste2Tricity.
Former Hydro International boss Michael Jennings has taken over as interim chief executive of Autins Group (AUTG). Jennings has been appointed for six months following the departure of the previous chief executive of the acoustic and thermal insulation supplier. The strategy is to take Autins products into new sectors so that it is not so dependent on a limited number of automotive customers. Earlier in the month, a major customer reduced orders leading to a profit warning.
A slow build-up of occupancy levels at the new Holland Park site meant that hostels operator Safestay (SSTY) performed disappointingly last year. Even so, EBITDA increased from £600,000 to £2.2m.
Botswana Diamonds (BOD) has entered into an option to acquire kimberlite projects in South Africa. Botswana Diamonds has the option to acquire a 72% interest in the projects in return for £942,000 in cash and 100 million shares. This is payable in stages. An exclusivity and option fee of £122,000 is payable equally in cash and shares at 1.9p each. Then £215,000 has to be spent on exploration in 12 months to earn a 15% stake and then a further £215,000 in the next 12 months to take the stake to 40%. There is then nine days in which to issue 96.8 million shares and pay £300,000 of shareholder loans in order to reach 72%. The main asset is the Frishgewaagt project in Limpopo province and there are nine other prospecting rights.
Connemara Mining Company (CON) has confirmed the presence of lead, zinc and silver within a 2 metre wide bed at the former silver mine at Glentogher in Donegal but there are no signs of gold. Connemara Mining had previously found gold 8km away and the structural model will have to be revised. Teck has spent enough on exploration to take its stake in the Oldcastle block on the Cavan/Meath border to 65%. The latest drill hole has found trace mineralisation (zinc and lead).
Savannah Resources (SAV) says that initial metallurgical results suggest that there should by 90% plus recoveries at the Oman copper gold project.
MAIN MARKET
BATM Advanced Communications Ltd (BVC) is paying £580,000 to buy Zer Laboratories, the largest private diagnostics laboratory in Israel. Zer’s expertise fits well with BATM’s move into non-invasive pre-natal tests. In 2015, Zer made a profit of $27,000 on revenues of $2.4m. There are potential deferred payments dependent on sales increases.
PRE-IPO / OTHER TRADING FACILITIES
Integumen, which bought the Innovenn healthcare product development business of Venn Life Sciences (VENN), is raising £2.16m ahead of a flotation. EIS relief is available for this investment. The offer equates to 23.6% of the enlarged share capital. Integumen has made three other acquisitions and its interests include skincare, wound care and oral care. It also includes the Labskin product developed by AIM-quoted Evocutis before it was sold to Venn. The offer is available via the Crowd for Angels crowdfunding site (www.crowdforangels.com/integumen)
Former GXG-quoted company US Oil & Gas is trying to raise up to £2.18m via a ten-for-63 open offer at 27p a share. A placing has already raised £470,000 at the same price. Revised resource estimates in the area of the Eblana#1 well in Nevada show a 20% recovery factor suggesting a low case of 57 million recoverable barrels of oil and a best case of 207 million recoverable barrels of oil.
Andrew Hore
Quoted Micro 2 January 2017
ISDX/NEX
Business incubator Milamber Ventures (MLVP) is acquiring The League of Angels, an angel network set up by Barney Battles, a Milamber director. There is a subsidiary called The China 68 Club that offers access to Chinese family offices. The business made a small profit last year and since April it has referred work to Milamber worth £200,000. Milamber is paying £150,000 in shares at 15p each. Battles will own 21.6% of Milamber. In the six months to September 2016, Milamber increased its revenues from £34,000 to £224,000, while the loss rose from £54,000 to £196,000.
Residential property developer Via Developments (VIA1) has found buyers for all eight apartments in its Canal Street development in Manchester and non-refundable deposits of £375,000 have been received. The apartments should be completed in the second quarter of 2017. The gross development value of the project is £2.2m. Revised plans have been submitted for the Plymouth Grove development in Manchester and planning applications for the Napier Street site in Luton, the place in the UK where house prices have been strongest over the past year, should be determined in the next few months.
African Potash (AFPO) has revised its bridge loan agreement with Katrina Clayton, the wife of the company‘s finance director. This agreement provided finance of £150,000 and this will be increased to £900,000, in return for a fee of £7,500, because it failed to raise additional cash through share issues. If the shares cease to be traded on ISDX/NEX or a regulated market then African Potash will be in default. The lender can also appoint a director to the company. There was a $2m cash outflow from operating activities in the year to June 2016, plus $873,000 of capital investment. There were limited revenues from fertiliser trading. Net debt was $706,000 at the end of June 2016.
Globe Capital Ltd (GCAP) had £5,000 left in the bank at the end of September 2016. There was a cash outflow of £91,000 over the previous nine months, while £100,000 was raised from issuing shares. The only investment is a 25% stake in online menswear retailer Sterling Craig.
AIM
It is not just TLA Worldwide (TLA) that has used the Christmas and New Year period to put out bad news, although none was quite as blatant and late in the day as TLA. Legal and debt management services provider Fairpoint (FRP) used the period between Christmas and New Year to report the departure of chief executive Chris Moat, although he will continue to assist in the closure of the debt management business. The share price has fallen by two-thirds since its profit warning on 9 December. Hargreave Hale has been trimming its stake from above 14% to 12.2%. 1Spatial (SPA) has parted company with its chief executive Marcus Hanke. This follows the disposal of the Avisen and Storage Fusion businesses. 1Spatial had warned that contracts were going to fall into 2017 and therefore it will make a 2016 loss.
Intercede (IGP) is raising around £5m from the issue of £4.5m of convertible loan notes and a £500,000 subscription at 57p a share – although this requires shareholder approval – compared with a market price of 57.5p. The identity and digital security services provider is not generating enough cash to make the required investment in its products and a move into the consumer market. Full year revenues will be less than the £11m reported for 2015-16. Interim revenues halved to £2.8m and the pre-tax loss soared from £432,000 to £3.67m. The cash pile fell from £5.29m to £1.38m in the six months to September 2016 so most of this cash has probably already gone. The convertibles last for five years and have an annual interest charge of 8%. The conversion price is just over 68.8p a share.
B2B gaming services provider Nektan (NKTN) has raised £2.275m at 27.5p a share and is offering shareholders the chance to subscribe for £500,000 at the same share price. That was a 15% discount to the market price but it has since fallen to 27p – compared with the November 2014 flotation price of 236p. In the year to June 2016, revenues jumped from £528,000 to £5.78m but the loss still increased from £8.12m to £10.5m. The cash outflow, before a rise in trade payables, was £6.18m. Conversion of loans means that Nektan’s stake in US business ReSpin has been raised from 50% to 85%.
It has not just been bad news between Christmas and New Year. Windar Photonics (WPHO) has revealed a number of new orders for its LiDAR wind sensors for use on wind turbines. An Indian power producer and the Indian National Institute of Wind Energy have ordered sensors, with the power producer ordering an initial five units with an option for a further 35 units. On top of this there are orders for seven units from Canada – a repeat order – and South Korea – the first order in that country. Windar has already said that its 2016 revenues will be between €1.5m and €2m – slightly below expectations. Before Christmas, Windar raised £491,000 at 94p a share. The share price has since fallen back to 77p.
Commercial property investor Summit Germany Ltd (SMTG) is paying a third interim dividend of 1.02 cents a share – the same as the previous quarterly dividend. The ex-dividend date is 5 January and forms to receive the dividend in pence need to be completed by 4 January. The exchange rate for the previous quarterly dividend was 0.8815p to one Euro, so the current exchange rate suggests that the sterling equivalent will be lower in this quarter. Summit has sold an empty office building in Hamburg for €14m.
Facilities management and security services provider Mortice Ltd (MORT) is generating more than three-quarters of its revenues from repeat business. In the six months to September 2016, revenues were 79% ahead at $91.1m. Much of that growth comes from a full contribution from the UK operations but the Indian business grew 22% and still accounts for 63% of revenues. Underlying pre-tax profit has jumped from $300,000 to $2/6m. Net debt was $14.6m but since then £2.3m has been raised at 75p a share. Trading continues to be strong.
Kodal Minerals (KOD) says that the latest samples at the Bougouni lithium project show high grade lithium mineralization of up to 2.03% lithium oxide. A total of 18 holes have been drilled and the results of analysis are expected by the end of January.
Stanley Gibbons (SGB) lost £6.18m in the first half, compared with a £1.11m profit in the comparative period after revenues slumped from £29.4m to £20.2m. Net debt was £16.5m at the end of September 2016. The US-based ecommerce business has been closed after an investment of £10m. A new coin joint venture has been set up by Baldwin with coin auctioneer St James’s, following a number of management departures.
Redcentric (RCN) has issued options to finance director Peter Brotherton and chief operating officer Mo Siddiqi. Brotherton has 161,905 options at nil cost and Siddiqi has 257,143 options at no cost, while Siddiqi has 250,000 at 84p each. These options are dependent on diluted earnings per share growth between March 2016 and March 2019. The compound annual growth rate required is not specified but the figures for the year to March 2016 have already been restated downwards. Siddiqi also has 250,000 options at 84p each that have no performance criteria. The current share price is 91p.
Grapheme NanoChem (GRPH) has gained its first commercial order for PlatDrill synthetic-based drilling mud in China. The initial order of 4,000 barrels of PlatDrill will be used for two shale gas wells in south west China and will generate revenues of $360,000. There could be more than 300 wells drilled in China each year over a five year period.
Mobile financial services provider Vipera (VIP) is increasing its stake in Codd & Date, which deploys Vipera’s technology services with customers, from 51% to 80.7%. In fact, the part of the business that focuses on Vipera’s Motif software will be split out and become a wholly-owned business. The enlarged group will move into larger premises in Milan More Info. Vipera is issuing 21.4 million shares and six million warrants exercisable at 5p each to pay for the additional stake.
CPP Group (CPP) is paying SSP £2.5m for terminating the contract to build an IT platform.
Fire and emergency services resource manager AssetCo (ASTO) is still attempting to renew its main contract in Abu Dhabi, which was due for renewal on 17 November. The contract will continue on existing terms until the new one is agreed. There should be further news concerning a one year extension at the end of January. Trading is in line with expectations.
Positive news from Providence Resources (PANR) concerning its VOBM4 well. Drilling of the Wilcox sandstone suggests that there is a potentially highly productive hydrocarbon zone at shallower depths.
Igas Energy (IGAS) is still trying to negotiate a capital restructuring and a strategic investor is interested in injecting funds into the business. There is around $32m left in the bank but net debt is significant enough for IGas to be on the verge of breaking its leverage covenant.
Circle Oil (COP) has lost its AIM quotation because trading in the shares had been suspended for six months and management says that the shares are unlikely to have any value. The International Finance Corporation and associates have waived debt repayments and deferred interest payments until 26 January.
MAIN MARKET
Derriston Capital (DERR) joined the standard list on 29 September. Medical products and devices are the proposed areas where an acquisition is likely to come from. Derriston (www.derristoncapital.co.uk), whose investors include Nigel Wray, former Domino’s Pizza boss Stephen Hemsley and Primary Health Properties boss Harry Hyman, raised £2.275m at 10p a share to go with the £56,000 previously raised. Derriston was valued at £2.5m when it floated. The standard list shell more than doubled in value in the first couple of days of trading but ended the week at 17.5p.
Andrew Hore
Quoted Micro 8 August 2016
ISDX
Chapel Down Group (CDGP) has exchanged contracts on the 1.6 acre site in Ashford that will be used for the proposed new Curious brewery. The deal will be completed when planning permission is obtained.
Valiant Investors (VALP) has raised £71,000 at 0.1p a share in order for it to finance the development of 83.3%-owned apps developer and marketer Flamethrower.
Milamber Ventures (MLVP) says that its grant application partner Private Shares has invested £25,000 at 16p a share and it will invest a further £25,000 at the same share price once Milamber holds a concept development workshop. Any grant writing services provided before 18 February next year will be paid for in shares at 18p each. Milamber non-executive director Barney Battles has invested £12,500 in shares at 16p each and also converted £12,500 of fees into shares at 18p each.
AIM
A positive trading statement from software robots company Blue Prism (PRSM) lead to a share price rise of more than two-fifths. The share price was already nearly double the flotation price of 78p and it reached 211p at the end of the week. A new contract has been won with a major bank and another large bank has renewed its contract for three years. This means that the full year figures will be better than expected.
Branded interior furnishings supplier Walker Greenbank (WGB) has received a second interim insurance payment of £3.2m relating to the flooding at the Standfast & Barracks printing factory in Lancaster at the end of 2015. A payment of £8m had already been paid. An £800,000 payment is expected soon and there could be more to follow. The factory is almost back to full production following the installation of new digital printers and the backlog of orders is being fulfilled. Overall group trading is in line with expectations. UK sales have fallen but overseas sales have grown. There could be a modest boost from the weakness of sterling.
Domain names wholesaler and services provider CentralNic (CNIC) has been awarded the contract to distribute the .FM domain by its owner BRS Media. CentralNIc plans to promote the top level domain to online streaming businesses. The deal also includes the launch of other domains including .AM.
Asset management software provider StatPro (SOG) continues to transfer customers to its StatPro Revolution SaaS-based service. In the six months to June 2016, revenues improved from £15.4m to £17.6m, while underlying pre-tax profit was slightly lower at £827,000. The real benefits of the transfer to monthly revenues for Revolution will show through next year. Edison forecasts a small increase in profit from £2.6m to £2.8m this year and then a 2017 profit of £3.7m.
Ultrasound simulation equipment developer and supplier Medaphor Group (MED) is acquiring Inventive Medical Ltd, which sells cardio ultrasound simulation products under the HeartWorks brand. Medaphor already has a relationship with Inventive Medical and the companies’ products are complementary. Medaphor is paying £3m in shares – at 43p each – for the company. Loss-making Medaphor has £3.5m in the bank and this should last until the end of 2017.
TechFinancials Inc (TECH) enjoyed a strong first half, which has reassured investors following the disappointment of its failed joint venture in Asia. Revenues grew by 30% to $9.6m, while EBITDA nearly doubled to $1m.Full year forecasts have not been changed but there could be scope for upgrades later in the year.
Cloud-based communications software and services provider CloudCall Group (CALL) is raising up to £3.77m at 57.5p a share – a 3.6% premium to the previous closing price. The cash will be used to expand sales activities, particularly in the US. This investment will be coordinated with its partner Bullhorn, which is starting to sell outside of its core recruitment customer base. CloudCall’s product is used by 12% of Bullhorn’s UK customers and 2% of its US customers.
MayAir Group (MAYA) has announced the commencement of a share buyback of up to 10% of its share capital. A maximum of £5.76m can be used for this buyback. This follows $17.7m of industrial and commercial clean air equipment contract wins in recent weeks.
MAIN MARKET
Engineering and environmental consultancy Waterman Group (WTM) expects to report a full year pre-tax profit in excess of its target of £3.3m. Waterman had set itself the target of tripling its profit in the three years to June 2016. Net cash has increased from £3.8m to £5.4m. Trading continues to be strong. The results will be published on 10 October.
Andrew Hore
Quoted Micro 18 January 2016
ISDX
Blockchain technology companies investor Coinsilium Group Ltd (COIN) has made two investments since it joined ISDX. Coinsilium has invested $50,000 (paid in Bitcoin) for the equivalent of a 1% stake in RSK Labs Ltd, and co-investment partners have invested the same amount. RKS developed Rootstock, a platform that is a sidechain of the Bitcoin blockchain. This technology enables transactions that can be set up to complete autonomously when pre-set conditions are met. Rootstock should be launched in the middle of 2016. RSK raised a total of $350,000 and the company’s valuation is $5m. Coinsilium has also increased its stake in Fuzo Ltd, which has developed a SIM card technology focused on adults that do not have a bank account. A $29,000 investment has taken Coinsilium’s stake in Fuzo to 13.6% – the total investment is $300,000. The valuation after the latest investment is $3m, which values the stake at $408,000. The Coinsilium share price has fallen back from the 10p flotation price. At 8p (6.5p/9.5p) a share, Coinsilium is valued at £5.7m. There were 15 trades during last week, which makes Coinsilium one of the more regularly traded ISDX companies.
Cyber security products developer Crossword Cybersecurity (CCS) has joined up with MHA MacIntyre Hudson to co-market Crossword’s Rizikon cyber risk analysis tool to the accountant’s small and medium-sized clients. Rizikon was developed at City University and it is Crossword’s first product. At 175p (150p/200p) a share, Crossword is valued at £4.2m.
Business incubator Milamber Ventures (MLVP) has acquired a 10% stake in White Cobalt, which develops technology platforms to help businesses to be more efficient and cope with growth. Milamber issued 166,667 of its own shares at 18p each in payment for the stake. This makes Steve Stovold, who founded White Cobalt in 2011, the fifth largest shareholder in Milamber with 4.7%. Powwownow founders Paul Lees and Andrew Pearce have each bought 50,000 shares in Milamber at 18p each. This cash will be used in a joint venture between their new business Thortful and Milamber. At 13p (12p/14p) a share, Milamber is valued at £455,000.
David Grierson has joined the board of investment company Lombard Capital (LCAP). He has been working in the timber and contracting sectors for four decades. Mark Jackson and Graham Jones have both left the board. At 6p (5p/7p) a share, Lombard is valued at £136,000.
AIM
Human microbiome-based products developer OptiBiotix Health (OPTI) has signed an agreement with KSF Acquisition UK, which will finance the assessment of the benefits of OptiBiotix’s SlimBiome weight management products when it used alongside SlimFast products. SlimBiome affects appetite, metabolism and energy harvest which fits with the SlimFast meal replacement products. Kainos Capital acquired SlimFast from Unilever in July 2014 and KSF is its UK offshoot with rights to the SlimFast brand in UK, Ireland and Germany.
Curtis Banks (CBP) will become the second largest SIPP provider following the acquisition of Suffolk Life from Legal & General for £45m. The enlarged group will have 65,000 SIPPs with assets of £18bn under administration. Suffolk Life made a profit of £1.3m in 2014 and there should be synergy benefits from the combination. A placing at 320p a share has raised £27m. The deal enhances 2016 earnings from 14.9p to 15.8p.
Management Resources Solutions (MRS) plans to acquire civil construction equipment and services provider Bachmann Plant Hire Pty for up to A$13.4m and the acquisition will more than double group revenues. There is an initial payment of A$8.2m in cash and the taking on of finance debt, while the rest is dependent on performance in 2016, 2017 and 2018. Bachmann provides earthworks equipment and operators in Queensland, Australia. There is a fleet of more than 200 vehicles and revenues were A$21.7m and pre-tax profit A$2m in the year to June 2015. MRS already supplies technical and strategic services to the oil and gas, construction and resources sectors. Project management activity has offset a decline in consulting work. This deal is a reverse takeover and the shareholder meeting is on 28 January.
Financial software and consulting services provider First Derivatives (FDP) has acquired Kx consultancy QuntumKDB for up to £2.2m, with £500,000 of this depending on the achievement of targets in the first 12 months. This deal will be earnings enhancing in the first full year. Quantum made a profit of £300,000 in the year to September 2015. First Derivatives has also signed a memorandum of understanding with Utilismart, which is expected to use Kx software for smart grid applications.
Interactive gaming operator Netplay TV (NPT) has extended its agreement with ITV for three years until 2019. Jackpot 247 has been on ITV since 2010 and Netplay will combine this TV exposure with its developing mobile platforms. Talks about the purchase of Sportech’s pools business have ended and NetPlay is not involved in the bidding process.
The UK National Screening Committee (NSC) is recommending that the IONA non-invasive test developed by Premaitha Health (NIPT) should be offered by the NHS to high risk pregnant women as part of the foetal anomaly screening programme. This will reduce the need for invasive testing.
Cambria Automobiles (CAMB) is paying £10.8m for a Land Rover franchise in Welwyn Garden City – Cambria has Jaguar and Aston Martin franchises nearby. In 2015, the franchise generated a pre-tax profit of £2.5m on revenues of £54m and it will be immediately earnings enhancing. A Jaguar franchise in Exeter is being sold for £1.3m and the Aston Martin franchise on the site will be closed. These businesses generated £500,000 profit in 2015. This leaves Cambria with 44 franchises and 17 brands. Cambria says that its first half trading is well ahead of the same period last year.
Ramblers Metals & Minerals (RMM) has completed the all share acquisition of Thundermin Resources. This means that Rambler owns 100% of the Little Deer and Whales Back copper projects. These have previously been mined and still include copper mineralisation. The infrastructure at the Ming mine could be used if the mines are brought back into production.
MAIN MARKET
Standard list shell RockRose Energy (RRE), which is headed by former Igas boss Andrew Austin, floated on 13 January and the shares ended the first week at 51.5p. RockRose raised £4.4m at 50p a share, having previously raised £600,000, but the costs of the flotation were £833,000. The company is capitalised at £5m at the placing price – so the net cash covers 83% of the valuation. The focus is UK onshore and offshore oil and gas assets which are in production and have significant reserves. The cash will help to finance the costs of due diligence and acquiring suitable assets.
Cash shell Falcon Acquisitions Ltd (FAL) will join the standard list on 18 January. A placing raised £1.6m at 10p, which capitalises the company at £2.04m, and there is a secondary fundraising may raise up to £2m at a share price to be set between 10p and 30p. There was already £265,000 in the bank before the flotation so there is cash of £1.65m after costs of £220,000. The focus is acquiring businesses involved in online, mobile and video broadcasting. Any target is likely to be worth up to £30m. The board includes directors from previous standard list shell Challenger Acquisitions.
Africa-focused oil and gas company Aminex (AEX) has secured a gas sales agreement with Tanzania Petroleum Development Corporation for the Kilwani North gas field, where Aminex has a 55.575% interest. Solo Oil has until the end of January to take up an option to buy an additional 6.5% stake in the field from Aminex, which would take its stake to 12.675%. A pre-determined level of production will be purchased each year and an invoice will be issued each month. The initial gas price is $3.07/mcf and there will be an annual indexation of the gas price.
Andrew Hore