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Stockbox podcast with Alan Green, Mark Fairbairn and Dan Flynn covers #ONDO, #GFIN, #OTB, #OMI, #IMM & #EGT
On this week’s Stockbox podcast with Alan Green, Mark Fairbairn and Dan Flynn, we discuss:
Ondo Insurtech #ONDO
Gfinity #GFIN
On The Beach #OTB
Orosur Mining #OMI
Immupharma #IMM
European Green Transition #EGT
Quoted Micro 18 September 2023
AQUIS STOCK EXCHANGE
An update on the Amapa iron ore project in Brazil from Cadence Minerals (LON: KDNC) says permitting times for the mine and related logistics should be reduced to 12-16 months. An environmental control plan is required to obtain the permits. This will enable a funding decision for the project. Investee company Hastings Technology Metals has expanded its offtake agreement with thyssenkrupp Materials Trading, which will take two-thirds of production from the Yangibana rare earths project.
Invinity Energy Systems (IES) has converted an existing order from Taiwan to its next generation Mistral flow battery. This is a higher margin product targeted at large wind and solar applications. Management is securing additional production capacity with Taiwan partner Everdura.
EPE Special Opportunities (ESO) had net assets of 308p/share at the end of July 2023. Investee company Rayware’s sales have been hit by weak consumer demand. Pharmacy2U continues to grow. Two investments have been sold. Ther was cash of £16.3m at the end of July 2023.
Financial services company Eight Capital Partners (ECP) says its 2021 figures have been restated because of a change in the accounting treatment of the bonds. Non-cash transactions have been removed from the cash flow statement. The book value of the bonds has been changed to fair value and a modified loss recognised on loan liabilities. Net liabilities were £11.4m. The 2022 results show net assets of £25.3m after a debt conversion to equity. A partial reversal of previous fair value adjustments also helped.
Coinsilium Group Ltd (COIN) is providing a convertible loan of $50,000 and has a 12-month option to subscribe for $500,000 for shares in Silta at a pre-money valuation of $7.5m. This means that it could end up with 6.7% of Silta. Last year, Coinsilium entered into an early contribution agreement to buy $75,000 of SILTA tokens. Silta is developing an advanced AI platform for sustainable infrastructure financing.
Hydro Hotel, Eastbourne (HYDP) is paying an interim dividend of 12p/share.
Rod Weinberg has reduced his stake in SulNOx Group (SNOX) from 6.35% to 2.49%. Macaulay Capital (MCAP) managing director David Horner has bought 200,000 shares at 22.5p each. Nigel Pope has taken a 3% stake in NFT Investments (NFT). Gathoni Muchai Investments has trimmed its stake in Marula Mining (MARU) from 12.2% to 11.26%. A warrants subscription at 4p each raised £30,500.
Black Sea Property (BSP) has raised €4.44m from a loan note issue, which is being used to pay for the recent acquisition of a majority stake in Grand Hotel Varna, which owns three hotels and a beach marina resort, plus a mutual fund portfolio. There is still €15.5m to pay.
AIM
Parcel delivery and logistics company DX (DX.) has received a bid approach from private equity firm HIG European Capital Partners. Gatemore Capital Management, which owns 16.8%, says it is willing to support the proposal of 48.5p/share. Management had rejected lower bids, but it would be minded to recommend this one. Due diligence will be required.
Online gaming firm Gaming Realms (GMR) reported interim revenues 35% higher at £11.5m and a 74% increase in pre-tax profit to £2.4m. The licensing business drove the growth. North American revenues increased by 47% and there are more states likely to ease restrictions on online gaming. Growth is coming from moving into new markets and adding new games. There are upfront costs to the expansion, holding back short-term profit. Net cash is expected to be £8m at the year end
Iodine producer Iofina (IOF) increased interim revenues by 27% to $24.3m, while pre-tax profit improved from $2.6m to $4.7m. First half iodine production was 242Mt. Iofina commenced production at its IO#9 plant in Oklahoma at the end of the half year. This is the sixth plant in operation and will help boost second half production to 325-350Mt.
Contract research and infectious disease study services provider hVIVO (HVO) is moving into larger London premises in Canary Wharf. The latest interims have led to an upgrade of guidance for the full year and hVIVO intends to pay a nominal dividend for 2023. Interim revenues were £27.3m, up from £18m, and the full year outcome is expected to be £55.1m with most of the rest of the revenues already contracted.
Construction and property software supplier Eleco (ELCO) increased like-for-like interim revenues by 5% to £13.5m. More importantly, recurring revenues were 18% ahead at £9.7m. This indicates the success of the move to SaaS-based revenues which has held back progress in the short-term. Net cash could reach £10.8m by the end of 2023.
Mkango Resources (MKA) subsidiary HyProMag, which is a short loop rare earth magnet recycler, is participating in a grant funded project called RE-RE Wind, which is designed to provide a circular supply chain for rare earth magnets for wind turbines. The first generation of wind turbines are coming up to the end of their life and a decommissioning programme is required.
Payments services provider Cornerstone FS (CSFS) made a small maiden interim profit. The move into profit was earlier than expected. Interim revenues were 90% ahead at £3.6m and most of this is direct business rather than through third parties. The overheads were held down enabling more of the additional revenues to flow through to profit. Cash is being generated from operations.
Online gaming company B90 Holdings (B90) has raised £2m at 5.44491p/share. The cash will go towards funding acquisitions and further investment in existing assets. The company is also converting £4.73m of loan notes and interest into 86.8 million shares. Enwys, which acquires customers for online gaming companies, has been bought. There are more than 20 other acquisition targets.
Keystone Law (KEYS) is paying a special dividend of 12.5p/share on top of the interim of 5.8p/share. Underlying pre-tax profit was one-quarter ahead at £5.7m, while net cash was £11.3m at the end of July 2023. Interest from new principal lawyers is increasing and 25 offers were accepted in the first half. There is plenty of back office capacity for additional lawyers.
Communications technology developer Feedback (FDBK) is taking time to secure new deals, but they should be on the horizon. The community diagnostic centres contract with the Queen Victoria Hospital has been delayed, but hopefully it should be secured by the end of the year. Feedback is still loss making, even though full year revenues were 74% ahead at £1.02m. The cash outflow, including capitalised development costs, was £3m and the £7.3m in the bank should last more than two years.
North Sea oil and gas producer IOG (IOG) has been told by the authorities that the Nailsworth P2342 and P130 licences are not going to be extended and this could have a negative commercial impact on the potential for the Elland licence. Bondholder discussions continue and the waiver lasts until 29 September. There was £14.5m in cash at the end of August, including £7.3m of restricted cash. There was stable production from Blythe H2, but the realised gas price was lower.
The Property Franchise Group (TPFG) has offset lower revenues from property sales by increasing lettings revenues. Overall interim revenues were 1% ahead at £13.2m. The higher tax rate meant that earnings slipped 2% to 13.8p/share despite an increased profit. The interim dividend was increased by 10% to 4.6p/share.
US-focused betting company Sportech (SPO) plans to leave AIM. It says the burden of time and money is too great. A circular will be sent out to gain shareholder approval at a general meeting.
Bushveld Minerals (BMN) has signed a binding term sheet for a potential $69.5m-$77.5m investment by Southern Point Resources. This includes the acquisition of 50% of Vanchem and 64% of the Mokopane project, plus a $12.5m investment in Bushveld Minerals. There will also be a working capital facility provided. Southern Point Resources will take over marketing and sales of vanadium and other products. The stake disposals will lead to a book loss of $59.6m.
Animal feed ingredients supplier Ocean Harvest Technologies (OHT) raised interim revenues by 43% to €1.8m and gross margins jumped to 36%. Investment in marketing and other aspects of the business meant that the loss was flat at €1.3m. These additional costs should help to generate further sales growth of its seaweed-based feed. Field trials could add up to €13m to annual revenues. However, delays in these trials mean that full year revenues have been downgraded from €4.3m to €3.4m. There should be net cash of €2.9m at the end of 2023.
MAIN MARKET
The FCA has approved the takeover of Lookers (LOOK) by Alpha Auto Group. The bid is 130p/share.
On The Beach (OTB) says its full year results will show record revenues and the holiday company says pre-tax profit will be at the top end of expectations. In the year to September 2022, revenues were £144.1m, which was slightly higher than the pre-Covid level of £140.4m, and underlying pre-tax profit was £14.1m. Consensus forecasts for 2022-23 were revenues of £179.5m and pre-tax profit of £22.6m. The guidance suggests that profit should be slightly higher than that. Even so, underlying pre-tax profit in 2017-18 was higher at £27.6m.
Andrew Hore
Alan Green discusses Gfinity #GFIN, ECR Minerals #ECR & On The Beach #OTB on the Vox Markets podcast
Alan Green discusses Gfinity #GFIN, ECR Minerals #ECR & On The Beach #OTB with Justin Waite on the Vox Markets podcast
Alan Green talks markets, On The Beach #OTB, Mirriad #MIRI and ECR Minerals #ECR on UK Investor Mag podcast
Alan Green discusses markets, On The Beach #OTB and the Atlantic Capital Markets note, Mirriad #MIRI and ECR Minerals #ECR with Jonathan Roy on the UK Investor Mag podcast.
Atlantic View – Time To Go Back To The Beach In Spite of Covid-19?
by John Woolfitt, Atlantic Capital Markets
Time To Go Back To The Beach In Spite of Covid-19?
Fundamentals & Statement Summary
With over 20% share of online sales in the short haul beach holiday market, On The Beach (LON: OTB) are one of the UK’s largest online beach holiday retailers. The group’s long-term mission to become Europe’s leading online retailer of beach holidays is fuelled by significant opportunities for growth on the back of innovative technology, low-cost base and a strong customer-value proposition.
On Tuesday June 30th, OTB announced interim results for the 6 months to March 31st, and said that prior to the escalation of COVID-19 in Europe, it had been trading well. In the first four months of FY20 and following the collapse of the Thomas Cook Group, OTB priced its offerings competitively, and saw total holiday sales grew by 29% for Summer 2020 departures. H1 revenue of £21.4m was down 66% on prior year due to COVID-19 related cancellations, with adjusted PBT down £13.4m to £2.3m due to a significant reduction in demand from mid-February when COVID-19 began to spread to Europe. Net debt of £13m excludes £68.8m 
of customer monies held in a ring-fenced trust account, and following a successful share placing on 22 May 2020, the group cash position was £50.5m, plus a £75m RCF facility which, at 31 May 2020, remained undrawn.
CEO Simon Cooper commented on the excellent progress in the first four months of the financial year, with the Thomas Cook collapse “driving record levels of brand awareness and achieving sales growth of almost 30% for holidays departing in Summer 2020.“
He added “The onset of the COVID-19 pandemic led to a rapid slowdown in demand for foreign travel followed by the total closure of airspace across Europe by mid-March. Our staff responded brilliantly to ensure that the Group delivered the highest possible customer service standards in the most difficult of circumstances”….”The flexibility and asset light nature of our business model together with our recently strengthened balance sheet and the actions we have taken since the middle of March means we are well placed to capitalise on the inevitable structural changes in the market post COVID-19. As a result, the Board continues to look to the future with confidence.”
Chart and Technicals
Source: FactSet and Hargreaves Lansdown
The inevitable ‘Covid cliff fall’ that characterises the charts of many stocks at present started at the end of February 2020, with the group losing 66% of its value during the following 25 or so days. A strong recovery during March saw OTB shares regain the 50-day moving average, currently at 290p, which it has held onto since April 16th. Provided the stock continues to hold the 50-day moving average, there is every reason to expect OTB shares to regain the benchmark 200-day moving average (purple indicator), currently at 358p, by the end of July 2020.
Summary and Atlantic View
While some may view OTB as a contrarian trade, our dealing team are attracted to OTB’s resilient performance before and during the COVID-19 crisis. The group responded strongly and took full advantage of the Thomas Cook collapse, leading to 30% growth in summer holiday sales pre-Covid, largely due to its innovative business model and low cost base. Added to this OTB have a strong cash position, boosted by strong shareholder support for the May 2020 placing. In summary, Atlantic Capital Markets are backing a long trade position on OTB, governed very much by the technical picture (358p initial target), and while the uncertain backdrop warrants running a tight stop loss, we are of the view that OTB is better placed than its peers to grow market share as the world starts to move again. In this case, it is time to go back to the beach!
To take advantage of this trading idea, speak to a member of our dealing team on 01872 229000 or visit the Atlantic Capital Markets website here
Ian Pollard – On The Beach #OTB hit by heatwave
On the Beach Group PLC OTB Revenue was heavily impacted by the unprecedented hot summer in Scandinavia leading to lower demand for holidays and widespread discounting of distressed product by Sweden’s leading tour operators. Nonetheless revenue at On the Beach Group for the year to the 30th September rose by 24.5%, profit before tax by 23.5% and adjusted earnings per share by 20.5%. The World Cup also suppressed holiday demand. The dividend is to be increased by 17.9% to 3.3p per share but.the consumer environment continues to remain challenging.
RPC Group plc RPC Enjoyed significant organic growth in China and US in the six months to the 30th September due to higher added value products. Revenue growth of 7% to £1,892m reflected continuing organic growth of 3.2%. Adjusted profit before tax fell by 2% or 5% on a statutory basis whilst adjusted basic earnings per share rose by 2% . The Interim dividend is increased by 4% to 8.1p per share representing the 26th consecutive year of dividend growth.
Telford Homes PLC TEF increased revenue by 31% in the six months to the 30th September Total profit before tax was up by16.1 per cent to £10.1m and the interim dividend is to be increased by 6.3% as the company made what it describes as pleasing progress, with a pipeline of 5,000 homes.
Senior plc SNR has issued a trading update for the ten months to the end of October and expects good progress to be made in 2018.
Luxury Villas For Sale in Greece http://www.hiddengreece.net
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BT Admits The Cost of Bad Management
BT Group BT.A airs its dirty washing in public after describing the year to the end of March as a challenging one, made worse by headwinds in the UK public sector. It is still managing to increase its final dividend by 10% despite a 19% fall in reported profit before tax, which slumped even more in quarter 4 with a fall of 48%. Reported basic earnings per share were also down by 33% for the year and 49% for quarter 4. And that is not the end of the bad news. Revenue for the current year is expected to be broadly flat and dividend growth will fail to reach the anticipated 10%.
To add to its list of excuses there were further headwinds from the international corporate market and the self inflicted in house disasters created by BT management itself, including hefty fines and avoidable problems in Italy. Management has learned lessons, it humbly claims. A bit late in the day perhaps but we shall see. The lack of heads rolling around on the boardroom and executive canteen floors may be regarded by some as a cause for concern.
Stobart Group STOB is proposing a 50% increase in dividends for the year to 28th February with a final payment of 4.5p per share. The year produced a statutory loss of £8m after deduction of non underlying items of £ 35.4m. On an underlying basis, profit before tax rose by 48.9% and basic earnings per share by 62.4%.
On The Beach Group OTB is paying a maiden interim dividend of 0.9p for the half year to 31st March, after a 7.3% increase in revenue led to a 33.8% surge in profit before tax. Adjusted earnings per share rose by 27.1% and net debt fell by some two thirds to £2.3m. The group describes this as a solid performance, strengthening towards the end of the half year and continuing to grow in the second half.
United Carpets UCG has announced a special dividend of 1p per share which will be paid on the 25th May
Supergroup SGP The year to 29th April produced good sales and profit growth, with revenue ahead by 27.2%. Profit for the year is ecpected to be in line with expectations at £86-87m
Luxury Villas & Houses For Sale In Greece; http://www.hiddengreec
Brand CEO Alan Green discusses On The Beach (OTB) on the Vox Markets podcast
Brand CEO Alan Green discusses On The Beach (OTB) with Justin Waite on the Vox Markets podcast
Reiterate Buy On The Beach (OTB) says VectorVest – Fundamental and technical position continues to improve
On The Beach Group (OTB.L) is an online retailer of short-haul beach holidays. The company markets the On the Beach brand to the UK, and the International segment, which includes Sweden activity through Swedish Website (eBeach.se). It offers packaged holidays with options to book single element products, such as flights or hotels. Its technology platform enables customers to package the constituent components of their holiday, including flights and hotels, and transfers to customize holidays from flight and hotel combinations.
Its search facility connects customers to suppliers of travel products. Each travel product is booked separately. The Company is independent from airlines and hotels, so that it offers customers a range of flight and hotel products bookable through online channels, including desktop, mobiles, tablets, and applications and over the phone.
On The Beach Group (OTB.L) was mentioned favourably here on December 13th. Link here to view that article. Although the share hasn’t seen the high percentage moves of a Sopheon or a Victoria both the technical and the fundamental position have improved. The chart is shown below, the share is undervalued and growing earnings strongly.
Since December 13th OTB has pulled back and kissed the high made in August 2016 and is now pushing northwards at the 2017 high. The 52 week high is at 300 and above this level OTB can break strongly towards 400p which is the VectorVest valuation.
Although OTB hasn’t done much since the initial blog entry, the technical and fundamental position has improved and the shares look bound much higher.
OTB should be considered by aggressive investors only as the relative safety (RS) of both below 1 on a scale between 0 and 2. Risk management is important in all financial trading but is especially important in low RS counters.
David Paul
February 28th 2017
Readers can examine trading opportunities on OTB and a host of other similar stocks for a single payment of £5.95. This gives access to the VectorVest Risk Free 5-week trial, where members enjoy unlimited access to VectorVest UK & U.S., plus VectorVest University for on-demand strategies and training. Link here to view.
FREE! For free VectorVest analysis on any stock, go to this link here
VectorVest Unisearch
On VectorVest a simple search using the Unisearch tool will quickly find shares that are undervalued with good fundamentals that have just issued a Buy recommendation. This will give the active trader a short list of many high probability trading opportunities each week. Traders now have the opportunity to spend five weeks discovering VectorVest’s unique simplicity, automation and independent guidance. Just £5.95 buys a 5 week trial to enable deep exploration, or how the system can assist in smarter trading in as little as 10 minutes a day. Powerful tools. Proven strategies. Unique Perspectives.
Link here for more info and to set up a trial.
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On The Beach (OTB) – VectorVest sees business model is uniquely placed to take advantage of difficult conditions in travel industry
On The Beach Group (OTB.L) is an online retailer of short-haul beach holidays. The company markets the On the Beach brand to the UK, and the International segment, which includes Sweden activity through Swedish Website (eBeach.se). It offers packaged holidays with options to book single element products, such as flights or hotels. Its technology platform enables customers to package the constituent components of their holiday, including flights and hotels, and transfers to customize holidays from flight and hotel combinations.
Its search facility connects customers to suppliers of travel products. Each travel product is booked separately. The Company is independent from airlines and hotels, so that it offers customers a range of flight and hotel products bookable through online channels, including desktop, mobiles, tablets, and applications and over the phone.
On December 6 2016, OTB published preliminary results for year to 30 Sept 2016. Group PBT increased by 776% to £16.9m (from a FY15 loss of £(2.5)m), on revenues 13% higher at £71.3m. At the end of the year net external cash rose to £26.1m (£10.9m), and a maiden final dividend of 2.2p per share was proposed. CEO Simon Copper said the results were “testament to the strength and flexibility of our agile business model amidst difficult conditions in the travel industry.” “Using our scale to drive exclusivity, our technology to drive innovation and our financial strength, ATOL protection and strong consumer brand to drive customer trust, we are well placed to capitalise on the structural changes in the market which will only accelerate given the difficult conditions in the market this year.”
The strong numbers in the results announcement simply confirmed the OTB investment opportunity, which had been picked up by VectorVest back in September after the share price had retraced from summer highs. The stock was flagged across a number of metrics, including Value, Relative Timing (RT), Growth to PE Ratio (GPE) and VST-Vector (VST) – the master indicator for ranking every stock in the VectorVest database. On value, a measure of a stock’s current worth, OTB is rated at 328.58p, well ahead of the current 263p.
The chart of OTB.L is shown above with the share price shown in candlestick format. The valuation is shown by the green line above the price and earnings per share (EPS)is charted by the blue line in the window below the price. The share is undervalued and growing EPS strongly and linearly. The share price has broken upwards through a major high (made in August 2016) and has pulled back and “kissed” this level which is marked as the horizontal blue line on the chart. With this resistance now in all probability becoming support the share is poised for further gains.
The Relative Safety of the share is less than 1 on the VectorVest program and this reflects and reinforces the risk associated with trading in small companies in their early stages of development. The opportunity is for those traders who have proven experience in managing risk.
Summary: OTB’s business model is uniquely placed to take advantage of the difficult conditions in the travel industry. The stock is also supported by a range of key VectorVest metrics outlined earlier in this blog, warranting a buy rating at current levels.
David Paul
December 14th 2016
Readers can examine trading opportunities on OTB and a host of other similar stocks for a single payment of £5.95. This gives access to the VectorVest Risk Free 5-week trial, where members enjoy unlimited access to VectorVest UK & U.S., plus VectorVest University for on-demand strategies and training. Link here to view.
FREE! For free VectorVest analysis on any stock, go to this link here
VectorVest Unisearch
On VectorVest a simple search using the Unisearch tool will quickly find shares that are undervalued with good fundamentals that have just issued a Buy recommendation. This will give the active trader a short list of many high probability trading opportunities each week. Traders now have the opportunity to spend five weeks discovering VectorVest’s unique simplicity, automation and independent guidance. Just £5.95 buys a 5 week trial to enable deep exploration, or how the system can assist in smarter trading in as little as 10 minutes a day. Powerful tools. Proven strategies. Unique Perspectives.
Link here for more info and to set up a trial.