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Andrew Hore – Quoted Micro 18 December 2017
NEX EXCHANGE
Wine and beer maker Chapel Down Group (CDGP) has raised £18.53m at 50p a share and could raise up to £1.47m more via a one-for-35 open offer at the same share price. The latest acceptance date is 5 January. Chapel Down will invest in an additional 500 acres of vineyard land and more money will be put into marketing. The family interests of Michael Spencer have invested in the fundraising. Nigel Wray has invested a further £500,000 but his stake has fallen to 16.5%, prior to the open offer. This year’s turnover is expected to be at least £11.6m and management expects growth to accelerate after the additional investment. New gin and vodka brands have been launched and the Ashford brewery should be up and running by the end of 2018.
Ashley House (ASH) has signed a joint venture with Morgan Sindall to develop extra care and supported living housing. This deal sparked a 55% increase in the share price to 14.75p. Morgan Sindall is paying £4m in total for the 50% stake in the joint venture, with £1.5m of this dependent on certain completion factors. It should all be paid by the end of 2018. The Ashley House housing division will complete two existing schemes and then own 50% of the joint venture, which will develop any further schemes. This additional cash will help to accelerate the growth of this part of the business. There is already a pipeline of potential developments. Ashley House will make an interim loss but expects to profitable for the full year.
e-commerce technology provider Netalogue Technologies (NTLP) reduced its interim loss as revenues grew from £317,000 to £479,000. There has been a lower number of larger projects, particularly in the food and drink sector, and Netalogue would have been profitable without the investment in the company’s technical team. A move towards a SaaS-based model could hold back short-term revenues.
AIM-quoted, spread betting business London Capital Group (LCG) has joined the NEX Exchange Growth Market on 15 December. Glio Holdings Ltd owns 78.1% of London Capital.
Early Equity (EEQP) has made two more investments. It has invested £60,000 in TruSpine Technologies Ltd, which plans to join AIM next year. TruSpine has developed the Faci-LOK and Cervi-FAS minimally invasive spine stabilisation devices and the VOSC catheter atherosclerosis treatment product. The plan is to gain FDA authorisation for Faci-LOK next year and then float. TruSpine is valued at £15m. A £35,000 investment in the profitable corporate finance and asset management business Farina Investments (UK) Ltd has been made ahead of a flotation. Early Equity raised £115,000 at 0.6p a share.
Hydro Hotel, Eastbourne (HYDP) has declared an unchanged total dividend of 21p a share for the year to October 2017.
Lombard Capital (LCAP) says that it is progressing towards the issue of an investment bond that will be quoted on a recognised bond market. There was nearly £60,000 in the bank at the end of September 2017.
Coinsilium Group Ltd (COIN) raised £720,000 at 9p a share and this will be used to invest in blockchain companies and expand the company’s own advisory business. Last June, £250,000 was raised at 2.2p a share. Coinsilium has been appointed as an adviser to token generation event of Hdac Technology AG, which is developing payment platforms for connected devices.
Equatorial Mining and Exploration (EM.P) has raised £5,000 at 0.01p a share and issued further shares for convertible loan notes and warrants at the same price. Valiant Investments (VALP) has raised £34,000 at 0.1p a share. Via Developments (VIA1) has issued a further £50,000 of debenture stock.
AIM
Satellites owner Avanti Communications Group (AVN) has revealed a financial restructuring that could put it on a firm footing. Certainly, without this restructuring the outlook would be bleak. The $557m of 2023 loan notes will be converted into two billion shares, while investors in the 2021 loan notes are being asked to accept and extension of the term and lower income. Annual interest charges would still be $36.6m
Best of the Best (BOTB) says that it expects to pay remote gaming duty and this will knock £300,000 from profit this year and £600,000 next year. This year’s pre-tax profit is forecast to decline from £1.5m to £1.4m, with a further fall to £1.2m in 2018-19. Net cash is expected to be £2.6m at the end of April 2018. The company is still claiming £4.5m of VAT so this could provide a cash boost in the future.
Plant Impact (PIM) is suffering continued delays in demand for its Veritas product in Brazil. A new partnership with Albaugh Brazil will commercialise other Plant Impact products in Brazil. This has sparked the decision to consider putting the company up for sale. Cash is running out and a further £7m would need to be raised to keep the company going well into 2019.
Van Elle Holdings (VANL) has defeated the five resolutions proposed by former chairman Michael Ellis at last week’s general meeting.
Recruitment and outsourcing services provider Servoca (SVCA) reported better than expected full year figures. Pre-tax profit improved from £3.5m to £3.9m. Education and healthcare will be the main growth areas.
Evgen Pharma (EVG) is collaborating with King’s College London to examine the use of SFX-01 as a therapy against ischaemic stroke. Multiple doses will be assessed and this will take nine months. This could lead to a clinical trial that might be funded by a charity organisation associated with King’s College.
Range Resources Ltd (RRL) returned to AIM following the reverse takeover of producing oil and gas assets in Trinidad from Trinity Exploration and Production (TRIN).
Defence equipment and services supplier Cohort (CHRT) had a weak first half but it expects to more than make up for that in the second half. There was a mixed performance with some parts of the business finding trading conditions difficult. The order book is worth £132m. Full year pre-tax profit is forecast to improve from £14.5m to £15.4m.
Savannah Resources (SAV) says that it has discovered high-grades and large intercepts in the latest drilling at the Mina do Barroso lithium project. A maiden mineral resource estimated could be announced before the year end with potential for upgrades from further drilling.
Daniel Stewart expects China New Energy (CNEL) to report a jump in pre-tax profit from £400,000 to £2.6m in 2017. The shares are trading on less than four times fully-taxed 2017 prospective earnings. The company constructs bioenergy plants that convert feedstock into ethanol. The most recently reported order book was worth £28.7m with the orders due to be fulfilled in 2017 and 2018. Demand from China is strong and there is also international business.
Coal bed methane projects developer Tlou Energy Ltd (TLOU) has secured a listing on the Botswana Stock Exchange and trading commenced on 13 December. Tlou raised £2.4m at 11p a share.
Synairgen (SNG) has secured a £5m cash injection from a deal with Pharmaxis, which will take over the development of LOXL2 in fibrotic diseases. Synairgen will also receive 17% of any partnering revenues. This compares with £3m invested by Synairgen in LOXL2. The cash will enable Synairgen to fund the phase IIa study for SNG001 for COPD. The trial should be complete by the end of 2018.
New management has turned around the performance of contract disputes and expert witness services provider Driver (DRV) and it moved back into profit last year. Cost savings have been made and the focus is on profitable business rather than just growing revenues. Cash collection is improving with net debt down to £200,000 and there is likely to be net cash of £2m in one year’s time. This year’s revenues are likely to be flat at around £60m but pre-tax profit should improve from £2.5m to £2.7m.
One month after its previous trading statement IDOX (IDOX) says that an internal audit has found that it should not recognise all the revenues that it originally intended to. This will knock £3m off profit for 2016-17. The software company reported its full year figures in December but the attest full year figures have been delayed until February. Chief executive Andrew Riley is away ill and former boss Richard Kellett-Clarke has taken over on a temporary basis.
Abzena (ABZ) reported interims in line with expectations. Growth came from the chemistry and manufacturing businesses. This is a period of capital investment as various parts of the company move to new facilities. The ADC master services agreement with a US biotech will yield at least $5m in services revenues over the next 12 months. This deal is shared between chemistry and manufacturing divisions.
Surface coatings provider Hardide (HDD) is starting to improve its gross margin as demand improves. There is even some signs of improved demand from the oil and gas sector. Even so, Hardide remains loss-making but it still has not gained any orders from Airbus. It raised £2.5m for capital investment earlier this year. A new reactor will be installed in the US in this financial year and another next year.
MAIN MARKET
Titon Holdings (TON) continues to benefit from strong demand for its window ventilation components in South Korea. The majority of profit comes from South Korea and that is where all the growth came from last year as the contributions from the UK and North America fell. In the year to September 2017, revenues were one-fifth ahead at £28m, while pre-tax profit improved from £2.14m to £2.49m. The dividend growth of 20% to 4.2p a share is ahead of earnings per share growth. A pre-tax profit of £2.81m is forecast for this year.
Avation (AVAP) has secured an initial $100m revolving facility to finance the acquisition of aircraft.
Sealand Capital Galaxy Ltd (SCGL) has secured an agreement with AIM-quoted MySQUAR (MYSQ) for the distribution of its games on MySQUAR’s platform and MySQUAR’s games on the Huawei InTouch platform. This is initially a two year deal.
Standard list shell Stranger Holdings (STHP) says that it expects to complete the acquisition of biogas and renewable energy business Alchemy Utilities. A five-year £20m bond is being raised.
Andrew Hore
Quoted Micro 16 October 2017
NEX EXCHANGE
This month marks the 22nd anniversary of the launch of NEX Exchange, although it was then originally called Ofex. A number of companies have gone on to bigger things, including Genus, which is in the FTSE250 index and accesso Technology, which is one of the top 50 companies on AIM. Further information can be found at http://www.hubinvest.com/AIMPDFOctober2017_97.pdf
MetalNRG (MNRG) has applied for two cobalt licences at Palomino and north Palomino in Western Australia but a rival has applied for the latter licence. There has also been interest from potential acquirers of this interest. A report has been received about the company’s US cobalt interests and this is being reviewed. A potential uranium project has been brought to the company and it is considering the opportunity.
Indigo Holdings (INGO) has invested £10,000 in 3sootjobs, a job search platform in Iran, giving it a 1.53% stake. Turquoise, which owns 32.1% of Indigo, and related parties, including Indigo directors, own around two-thirds of 3sootjobs.
Ecovista (EVTP) has bought a 80% stake in a company that owns a four bedroom property near Stanstead and it has paid £10,000 for an option on the next door property. The properties cover 1.72 acres.
AIM
Parcel delivery company DX (Group (DX.) is raising £24m from an issue of convertible loan notes. The conversion price will be 10p a share and the interest rate 8%. There is potential to issue a further £2m of loan notes. Lloyd Dunn has been appointed as chief executive but he is not on the board. Along with three directors, he is subscribing for £5.25m of loan notes.
Angle (AGL) has further positive indications of the effectiveness of its Parsortix liquid biopsy technology and it has also raised a further £2.8m, taking the total raised at 37.5p a share to £15m. Heinrich Heine University researchers has been able to able to continue to grow circulating tumour cells harvested using a Parsortix device.
Fashion retailer Quiz (QUIZ) performed strongly in the first half and online sales have increased to one-quarter of the total. This was before the launch of a website focused on Spain and there are plans for other international websites. The UK stores grew sales by 15%. Overall revenues were 35% ahead at £56.1m.
Orogen (ORE) is acquiring Thread 35 Ltd and changing its name to Sosandar (SOS), which is the acquisition’s online womenswear brand. The brand was launched on 19 September 2016 by the founders of fashion magazine Look and is aimed at the affluent professional woman. Orogen is paying £6.3m in cash and shares for the acquisition. Ten Orogen shares are being consolidated into one new share. A placing at 15.1p a share will raise £4.8m net to cover the cash portion of the acquisition cost.
Toilet tissue supplier Accrol Group Holdings (ACRL) expects to pay between£550,000 and £2.9m and because of its guilty plea the amount will be discounted by one-third. The figure will be announced early next year. Talks continue with major shareholders and the bank.
Wynnstay Group (WYN) has appointed administrators to Just for pets and 18 of the stores have been sold to PSR Ltd. The other seven have been closed. The loss-making pet products retailer had net assets of £2.2m.
Crop enhancement products supplier Plant Impact (PIM) increased its full year revenues by 17% to £8.5m even though sales in Brazil were disappointing. Higher research and development spending meant that there was a £3m loss. There was £7.2m in the bank at the end of July 2017. Plant Impact is moving into new geographic markets as well as building share in its existing markets.
Motor dealer Vertu Motors (VTU) intends to use some of its cash to buy back up to £3m worth of shares. There was net cash of £20.8m at the end of August 2017. Interim revenues were flat at £1.45bn buy underlying pre-tax profit was 7% higher at £20.9m.
Patrick O’Sullivan, who failed to gain a board seat at Conroy Gold and Natural Resources (CGNR), has reduced his stake in the Irish gold explorer to three million shares (24.6%). Conroy was awarded costs of the court proceedings made by Patrick O’Sullivan and the level is still to be assessed. Conroy has decided to cancel its quotation on the Dublin-based Enterprise Securities Market on 6 November. Conroy will still be quoted on AIM so shareholder approval is not required. Andrea Gonella currently owns less than 3% of Conroy, having owned more than 6% in July. Conroy has raised €240,000 via a €0.30 a share placing and a further €167,000 was raised from warrants taken up by directors Professor Richard Conroy and Maureen Jones.
Digital Barriers (DGB) has decided to sell its video business for up to £27.5m. It will concentrate on its Thruvision people screening business.
InterQuest Group (ITQ) has appointed Allenby as its nominated adviser and Peterhouse as its broker so trading in the shares has recommenced. Chisbridge Ltd ended up with 58.3% of InterQuest after its bid. It still wants to ditch the AIM quotation and it can buy shares in the market in order to increase the stake.
Patient monitoring device developer LiDCO (LID) has gained its first long-term high use programme contract with a US customer but that did not contribute in the first half. In the six months to July 2017, revenues were 4% higher at £3.9m and the loss was £1m. That was due to higher sales and marketing costs without the benefits of higher sales yet showing through.
1Spatial (SPA) has sold its non-core assets so that it can focus on geospatial data. There is particular potential in the US market. Although interim revenues were flat at £12.1m but a greater proportion were from the geospatial business. The operating loss was reduced from £1.9m to £1.2m and the cash outflow in the period was minimal. Claire Milverton has been confirmed as chief executive.
Two graphene-related companies are raising cash. Applied Graphene (AGM) has raised £9m at 36p a share and existing shareholders are being given the chance to subscribe for up to £1m via a one-for-eight open offer. There was £4.7m in the bank at the end of July 2017. The cash is being used to finance joint development activity for the strategic ink programme, which uses 2D inkjet printing to deliver graphene-based inks. Other potential uses are also being explored. Haydale Graphene Industries (HAYD) is raising £10m via a placing and offer at 120p a share, which was a 32% discount to the market price. Haydale recently changed broker to Arden. The cash will be used to provide working capital for existing orders and to develop new uses for graphene, including cookware.
SaaS-based accounting software supplier FreeAgent Holdings (FREE) says that it generated interim revenues of £4.6m, compared with £3.6m. There was a smaller first half loss and had net cash of £3.4m at the end of September 2017.
Top level domain names owner and distributor Minds + Machines (MMX) has received approval from the authorities in China to sell .law, .work, .beer and the Chinese equivalent of .shopping. Four more extensions are going through the approvals progress. So far, revenues from China for .vip have been a significant contributor to group revenues.
A consortium led by former chief executive Peter Earl is in early discussions with Rurelec (RUR) about a bid that could be backed by Rurelec’s joint venture Patagonia Energy Ltd.
An application to enable Redx Pharma (REDX) to get back control of its main subsidiary will be heard on 26 October. If approved, the subsidiary will come out of administration and the suspension of trading in Redx shares could be lifted.
Realm Therapeutics (RLM) has completed the £19.3m placing at 29p a unit (one unit is one share and a warrant for 0.4 of a share). The warrants provide an opportunity to subscribe for a share at 58p each. The initial focus of the cash will be the treatments PR022 for atopic dermatitis and PR013 for allergic conjunctivitis. There are also plans for a phase II trial for the PR023 treatment for acne vulgaris.
PipeHawk (PIP) has sold its 28.4% stake in south east England-based survey practice SUMO Ltd to its own executive chairman Gordon Watt for £197,499. That is the equivalent of the investment in loss-making SUMO and is more than its value in the books.
Dr Cliff Holloway has been appointed as chief executive of Scancell Holdings (SCLP) and he will push forward the immunotherapy platforms being developed by the company. His predecessor Dr Richard Goodfellow is remaining on the board. Scancell had £2.67m in the bank at the end of April 2017, which was less than the cash outflow in the previous 12 months.
Ashanti Gold Corp says that the Anumso gold project, where Goldplat (GDP) is earning up to 75% through a $3m investment in exploration, has broader and new mineralised zones. Soil sampling has produced good results and suggests high gold recovery rates.
Former AIM company Zenith Hygiene has agreed a cash bid from BCPE Diamond UK. The deal values Zenith at £100m, based on its enterprise value, although the final amount depends on performance.
MAIN MARKET
Cash shell J2 Acquisition Ltd (JTWO) commenced trading on the standard list on 10 October, having raised $1.25bn. The shell is seeking a company with a strong market share and proven track record. If an acquisition is not made within two years, shareholder approval will be required for a further 12 months of operation.
Levrett (LVRT) has completed the acquisition of Nuformix Ltd for £12m in shares at 4p each and it has changed its name to Nuformix. A further £2.3m has been raised at 4p a share. Trading will recommence on 16 September.
Sealand Capital Galaxy (SCGL) has signed a memorandum of understanding with AIM-quoted MySQUAR (MYSQ) that will enable the two companies to distribute each other’s mobile games.
Monchhichi (MCC) still intends to follow Pembridge Resources (PERE) from AIM to the standard list but the move has been delayed until mid-November. This will follow shareholder approval for the €10m investment in artificial intelligence, machine learning and behavioural data science company Sentiance and the approval of the prospectus by the UKLA. Sentiance lost more than €2m on revenues of €1.4m in 2016.
WideCells Group (WDC) plans to launch its CellPlan insurance for stem cell treatment in Spain before the end of the year. A partner has been secured for the expansion of stem cell services in the Middle East, north Africa and Asia Pacific. White Apex General Trading will be exclusive strategic partner for three years.
Andrew Hore
Centamin Production At Record Levels
Centamin CEY With all sections of its Sukari mine producing, gold production for the quarter ending on the 30th September rose to record levels with a 26% increase over the second quarter and a 5% increase over the third quarter of 2016. Production guidance of 540,000 ounces for 2017 is maintained.
YouGov plc YOU has for the third year in succession, delivered growth which is “significantly above the market both in revenue and profit”, resulting in a recommendation that the final dividend be increased to 2p, a rise of 43%. Revenue for the year to 31st July rose by 21% and statutory profit before tax and earnings per share by 43% and 35% respectively. Growth is expected to continue in the current year.
Angling Direct ANG Gross profit for the half year to the 31st July grew by 35.3% and EBITDA by 72.6% to 0.93m. Online sales surged by 67% whilst store sales showed an increase of 38%, both of which will be suitably augmented by the acquisition of Fosters of Birmingham, announced on the 2nd October and new store openings since admission to AIM which it describes as a “strong pipeline”.
Plant Impact PIM A rise of 17% in revenue for the year to 31st July was due mainly to the strength of the dollar, without which it would have been a much more modest 2%. Gross profit for the year saw a rise of 19% and the company claims that it has an excellent set of commercial and R&D prospects ahead which will help in its aim to establish itself as leader in what ir describes this new category of “agricultural inputs” sic.whatever one of those may be.
CAP-XX Limited CAP-XX claims it is pleased to announce a drop in sales for the year to 30th June from A$5 m. to A$4.1m. and a near doubling in the EBITDA loss from A$0.7m. to A$1.2m. As against that it should be and is more than pleased to see royalty revenue more than tripling from A$0.2m to A$0.7m and operating expenses falling by A$0.5m. The CEO says it has been an exciting year which saw “tangible traction” which is presumably a good thing to see.
Beachfront villas & houses for sale in Greece http://www.hiddengreece.net
Corporate news review Tuesday 15th August 2017
Hargreaves Lansdown HL. reports net FY new business of £6.9bn, AuA up 28% to £79.2bn and active clients up 118k to 954k. PBT is up 21% to £265.8m, and HL raises its dividend by 20% to 29p per share.
John Menzies MNZS says it has enjoyed a positive first half, with underlying PBT up 36% to £24.7m and a proposed 11% increase in the interim dividend to 6p. Chairman Dr Dermot F. Smurfit said: “Overall, I am very pleased with the Group’s performance in the first half and we look to the future with confidence as demonstrated by the increased dividend payment.”
Mears Group MER reports interim results in line with management expectations, with revenue up 1% to £470.8m.
Plant Impact PIM publishes the first presentation on its R&D platform and pipeline. The full presentation can be found at www.plantimpact.com/investors.
Rockhopper Exploration RKH updates on the Abu Sennan drilling concession, onshore Egypt, in which the Company has a 22% working interest. Production from the six fields within the Abu Sennan concession remains stable, averaging 3,300 barrels of oil equivalent per day (“boepd”) gross during the first six months of 2017. The group also updates on the Al Jahraa-9 well.
WideCells WDC raises £750k gross through the issue of 5,357,143 ordinary shares at 14p per share via a private placing with new and existing shareholders and the Board of Directors. The funds raised will be used to execute on a range of additional opportunities the Group has identified since listing in July 2016, rapidly accelerate the roll out of its three stem cell services divisions, CellPlan, WideCells and WideAcademy, and further its penetration of the rapidly growing stem cell market.
Wood Group WG. / Amec Foster Wheeler AMFW – The CMA (Competition and Markets Authority) today accepts in principle the remedy formally offered by Wood Group on 9 August to complete the recommended all-share offer for Amec Foster Wheeler. Robin Watson, CEO of Wood Group said “Today’s announcement is an important milestone and gives us further confidence in our ability to complete the transaction in quarter four this year.” Jon Lewis, CEO at Amec Foster Wheeler said “We welcome the announcement by the CMA. Our offer of a proposed remedy in May and the early commencement of the sale process to potential buyers of the upstream oil and gas business has ensured we have navigated this process ahead of schedule increasing the likelihood that the transaction with Wood Group will close in quarter four this year.”
Quoted Micro 31 July 2017
NEX EXCHANGE
Kryptonite 1 (KR1) has invested $100,000 in the initial coin offering of the Omisego project, which is being developed to enable decentralised payments and remittances, acquiring 365,199 tokens. A further $200,000 has been invested in a similar offering by the Insurex platform, a marketplace for insurance products, and $100,000 invested in tokens in the Agrello project, which is building an artificial intelligence-based interface for smart contracts.
Good Energy (GOOD) has agreed with Ecotricity that there should be a short deferral of the latter’s general meeting requisition. Good Energy still believes that “any nominee remunerated by Ecotricity” that joined the board would not act independently because of a conflict of interest. An appeal for planning permission for the Big Field onshore wind farm in Cornwall. Good Energy has switched its nominated adviser and broker from Arden to Investec.
e-commerce technology provider Netalogue Technologies (NTLP) says that strong second half trading made up for a weak first half. In the year to March 2017, revenues slipped from £1.12m to £1.04m and made a loss before restructuring coats of £11,000 compared with a pre-tax profit of £70,000 the previous year. This does mean that the second half profit was £221,000. Cash in the bank increased from £549,000 to £614,000, mainly due to lower debtors. There was a net increase in intangible assets of £67,000. New clients include AIM-quoted Conviviality, Enterprise Inns and Marstons. The full benefits of management changes and improved marketing are still to show through in the figures.
Ecovista (EVTP) has sold its subsidiary that owns 2 Willow Cottage and adjoining land near to Stanstead Airport for its book value of £400,000. However, the original cost of the investment was £500,000 and management was hoping to gain planning permission for car storage. It is unclear whether the former subsidiary still owns the same assets or whether any have been transferred elsewhere. The cash will be reinvested in other property.
V22 (V22O) has received planning permission for Silvertown Studios at the Royal Docks in London. V22 owns 51% of the company developing the studios, along with the landowners the Greater London Authority and The Silvertown Partnership, and a private investor owns the rest. There will be up to 200 workspaces and exhibition spaces. This development is part of £3.5bn Silvertown regeneration project.
Online games company Ganapati (GANP) has agreed a debt for equity swap with major Japanese shareholders. Shares will be issued at 52p each and £610,000 of debt will be capitalised. The current share price is 55p (45p/65p).
AIM
Morning sickness treatment Diclectin has not gained marketing authorisation from the Medicines and Healthcare products Regulatory Authority in the UK, which is a blow to the strategy of Alliance Pharma (APH). The effectiveness of Diclectin is being questioned in Canada, where around 50% of pregnant women are prescribed the drug, and it is claimed that there are flaws in the original study of the treatment from four decades ago. In 2015, Alliance in-licenced Diclectin for the UK, and subsequently nine other countries, for £1.5m. Alliance hoped to begin sales in the UK by the end of the year and it was estimated that the potential annual revenues in all the in-licenced markets were £40m.
Fiserv has postponed the court meeting for its 2.9p a share bid for mobile banking technology developer Monitise (MONI) because some substantial shareholders have been unhappy about the level of the bid. The Monitise board still recommends the bid, which values the company at £70m. Full year revenues have fallen from £67.6m to £50.9m and the trend is set to continue. The new FINkit platform has yet to secure a contract.
Mortice Ltd (MORT) reported full year revenues 37% higher at $181m and more than trebled pre-tax profit of $5.35m. Net debt was $13.5m at the end of March 2017. Facilities management services grew revenues the fastest and it moved into profit but security revenues also grew strongly. Around three-fifths of the growth in revenues came through acquisitions but there was significant organic growth particularly in the core Indian business.
Minds + Machines Group (MMX) says that renewal rates for .vip have been 75%. There were 317,000 renewals and new registrations have risen by 49% since the beginning of the year. The .vip suffix accounted for 59% of 2016 gross billings and finnCap estimates that renewal revenues could be $6.1m this year. There will be more news about the strategic review with the interims in September.
ANGLE (AGL) says that there were positive results from a 400 patient ovarian cancer study using the Parsortix liquid biopsy technology and a breast cancer clinical study should report in the first half of next year. There are also pilot studies for other cancers. Any single cancer could provide a significant market for the Parsortix diagnostic technology. Sales for research use are taking time to build up but revenues did improve from £361,000 to £398,000. At the end of April 2017, there was £5.5m in the bank with more than £1m of R&D tax credits due to be received. That cash could last one year but this will depend on how quickly the research revenues grow and if there are any potential deals.
Crop enhancement technology developer Plant Impact (PIM) is raising £4m at 31p a share, which was a 6% premium to the market price. This will more than double the existing cash balance of £3.2m. The cash will be spent on R&D and product development.
Gear4music (G4M) says trading is in line with expectations. The musical instruments retailer expects second half weighted revenues this year. First half revenue growth will be modest but full revenue growth of 42% is anticipated. Investment in new European distribution centres will increase costs, including depreciation, and this is forecast to lead to a decline in full year pre-tax profit from £2.7m to £2.4m this year, before increasing to £3.3m the following year.
Quartix Holdings (QTX) reported flat interim revenues of £11.5m and pre-tax profit of £3.4m. The interim dividend of the telematics business has been increased by 9% to 2.4p a share and a special dividend is expected later in the year. Insurance business has recovered so full year revenues could be slightly higher, while pre-tax profit could be flat at £6.7m.
Conroy Gold & Natural Resources (CGNR) is holding a requisitioned general meeting in Dublin on 4 August. Patrick O’Sullivan, who owns 28% of Conroy, wants to remove six directors: Seamus FitzPatrick, James Jones, Dr Sorca Conroy, Louis Maguire, Michael Power and David Wathen and replace them with Patrick O’Sullivan, Paul Johnson and Gervaise Heddle. The three directors not affected by the requisition are Professor Richard Conroy, Maureen Jones and Professor Garth Earls. The indicated resources at Clontibret in Monaghan have been increased by 23% to 310,000 ounces of gold.
Interactive entertainment company Tencent has taken invested £17.7m in Frontier Developments (FDEV) and it is expected to promote games developed by the AIM company. The 9% stake was acquired at 523.2p a share.
MAIN MARKET
Specialist smaller companies-focused investment trust Athelney Trust (ATY) increased its NAV by 7% to 268.7p a share by the end of the first half of 2017. This is after the payment of a final dividend of 8.6p a share. Athelney nearly doubled its money on Lavendon when it was taken over and it has also sold its stakes in Beazley, Hiscox and Novae. New investments include The PRS REIT, Murgitroyd, Safecharge, Hostelworld, Ibstock, Crest Nicholson and Debenhams. According to the company the uncertainty in the country and the economy means that: “A sensible aim would be to try to hang onto the gains made in the first half”.
Senterra Energy (SEN) is being readmitted to the standard list on 31 July as United Oil & Gas (UOG) following the acquisition of UOG Holdings.
Biodecontamination services provider Bioquell (BQE) says that its full year profit will be better than expectations. Bioquell increased its interim revenues by 19% to £14.3m and pre-tax profit more than trebled to £1.4m. Net cash was £11.8m at the end of June 2017, compared with a market value of just over £46m at 199.5p a share.
Sealand Capital Galaxy Ltd (SCGL) has signed a memorandum of understanding to acquire at least 51% of China-based mobile games developer Rightyoo. The acquisition discussions are still at an early stage and the deal has to be approved by the Chinese authorities. Rightyoo has an agreement with communications technology firm Huawei to help it to distribute its games. Management believes that the deal will help to add traffic to Sealand’s social networking platforms.
Andrew Hore
Quoted Micro 24 July 2017
NEX EXCHANGE
Ace Liberty & Stone (ALSP) has raised £10m via a 6% convertible loan note. The conversion price is 71.25p a share and full conversion would be the equivalent of 26% of the share capital. The loan note is redeemable on 23 May 2019. The holder of the loan note has also been granted an option to purchase some of Ace’s properties.
Block Energy (BLOK) has increased its ownership of the Norio onshore oil field production sharing contract in Georgia from 38% to 69% at a cost of $310,000 in cash. The plan is to move to a 100% working interest. Schlumberger estimates that Norio contains 118.7 million stock tank oil initially in place and it has produced 1.9 million barrels. The production is running at 25 barrels per day and the plan is to increase this to more than 250 barrels per day. That could happen within six weeks of the start of a work programme.
African Potash (AFPO) has raised £50,000 at 0.045p a share and appointed Alexander David as its new corporate adviser. This will help to get the trading suspension lifted. Warrants to raise a further £50,000 will last for 90 days from the lifting of suspension. An agreement has been entered with African Agronomix, which is being given the right to acquire 100% of the company’s 70% interest in the Lac Dinga project in the Republic of Congo.
NQ Minerals (NQMI) has appointed Beaumont Cornish as its provisional nominated adviser for a proposed move to AIM. NQ Minerals has secured a $7m loan facility from the RIVI Opportunity Fund and this funds the final payment for the Hellyer gold mine in Tasmania. A gold purchase agreement means that 14% of the first 22,000 ounces of payable gold and 7% of the amount in excess of that figure has to be sold to RIVI.
The joint venture between a 40%-owned subsidiary of food and logistics company AfriAg Global (AFRI) and LGC Capital, which is quoted on TSX, is acquiring a 60% stake in South Africa-based House of Hemp, which has a long-term lease on the only certified indoor cannabis growing facility. The joint venture is paying nearly C$20,000 and C$37,000 a month for six months. The joint venture will also secure C$4.9m to scale up production. David Lenigas is chairman of both joint venture companies.
MiLOC Group Ltd (ML.P) has raised £166,000 at 28.5p a share.
AIM
Audio visual products distributor Midwich Group (MIDW) says that the weakness of sterling has helped it to grow and the recently acquired Spanish business has done better than expected. This has led to upgrades for the next three years. Investec has raised the 2017 earnings forecast to 21.3p a share. Cash generation remains strong and the net debt forecast has been reduced to £20.2m. The interim figures will be reported on 12 September.
Regenerative medical devices developer Tissue Regenix Group (TRX) is acquiring CellRight Technologies, a US-based developer of bone processing and soft tissue products, for an initial $25.9m (£19.9m) with an earn-out of up to $4.1m (£3.1m) depending on revenues. The bone technology widens the group product range from a pure focus on soft tissue products. The deal also includes a US manufacturing facility. CellRight has launched 13 products since 2012 and more are due in the second half of 2017. The products are sold through distributors. In 2016, revenues were $5.42m and the gross margin was 62%. Two-fifths of revenues were from spine products. In the eleven months to December 2016, Tissue Regenix revenues were £1.44m. Tissue Regenix raised £40m at 10p a share and the additional funds will finance the growth of the enlarged business. All but one of the directors has subscribed for new shares. Management believes it is possible for the group to move into profit by 2020. Tissue Regenix plans to launch seven products over the next two years.
Qannas Investments Ltd (QIL) is using $8m to tender for 12.9% of the share capital at $0.90 each. There are not enough distributable reserves to pay a dividend of this size.
Transport optimisation software and services provider Tracsis (TRCS) has won a multi-million pound contract with a UK rail operator. The contract will last four years and includes the renewal of some existing licences. There should be recurring revenues after the four year period. There will be no contribution in the year to July 2017.
Tristel (TSTL) says that sales in the year to June 2017 were 17% higher at more than £20m and pre-tax profit is going to be more than 10% higher than forecast. The pre-tax profit is expected to be £4m. The growth is predominantly from international sales.
Crop enhancement technology developer Plant Impact (PIM) says that full year revenues will be between £8.5m and £9m, up from £7.2m the previous year. This is despite the cancelation of shipments of Veritas to Brazil. Contract discussions about Veritas with Bayer in Brazil are continuing and they may take some time. However, new buying arrangements are expected to help 2017-18 revenues reach £13m. There is £3.2m left in the bank but a further £2m is being raised at 31p a share with the possibility of a further £2m. This cash is required to finance R&D.
IP Group has raised its all share offer for Touchstone Innovations (IVO) but technology business developer says that the offer of 304p a share, based on an IP Group share price of 137p, is still below its NAV of 312p a share.
EQTEC Group (EQT) is in talks to acquire the waste-to-energy technology subsidiary of its majority shareholder, EBIOSS. EQTEC will pay for the business in shares and it will also need to raise more cash for working capital. Due diligence is being undertaken.
TV programmes producer Zinc Media Group (ZIN) expects to make EBITDA of £300,000 in the year to June 2017. The business has been restructured and starts the new financial year with a strong base. There is a commissioned TV slate of £6.5m for this year.
Security technology supplier Synectics (SNX) reported a 5% increase in revenues and a rise in gross margins, which enabled the interim pre-tax profit to increase by £1m to £1.3m. The oil and gas sector is showing signs of recovery and the order book is worth £33.7m. There is net cash of £1.8m. A full year profit of £3m is forecast.
Inland Homes (INL) increased its completions by 28% to 188, helped by the development of the company’s in-house construction team. In the year to June 2017, revenues will fall from £102m to £90m, although this excludes the revenues from two land sales.
First Property Group (FPO) has launched a new fund which could double third party assets under management. Fprop Offices LP has eight institutional investors and will invest in office blocks and business parks over a seven year term. So far, £182m has been invested in the fund, including £3m by First Property. A loan to value of up to 30% is allowed. This new fund will not pay recurring management fees and instead First Property will take a share of any profit.
Parity Group (PTY) continues to increase its exposure to consultancy activities. WH Ireland has trimmed its revenues expectation for this year but has maintained its pre-tax profit forecast at £1.6m.
Pembridge Resources (PERE) is raising £2.5m at 1.6p a share as part of the planned move to a standard listing.
MAIN MARKET
World Trade Systems (WTS) has dispatched a circular to shareholders in order to gain retrospective approval for loans from Kudrow, which is deemed to be a related party. This is part of the process of the re-application for a standard listing. Kudrow has waived its right to interest and there is an intention to convert the remaining loan of £860,000 into shares.
Bluebird Merchant Ventures Ltd (BMV) says that work has started on reopening the Gubong mine in South Korea.
Andrew Hore
Weir Group Recovery Starts
Weir Group Weir has North America to thank for signs of recovery in its fortunes. North American oil and gas markets have recovered more strongly than anticipated and volume and price increases have both been ahead of prior expectations. Operating margins in the first half have been in low double digit figures and full year revenue and operating profits will be above the upper end of analysyst’s estimates
Finsbury Food FIF updates that it is very pleased to have grown revenue in the year to the 1st. July, ignoring the unwelcome fact that on a constant currency basis its like for like revenue actually fell by 1.4% and on an actual basis only rose by 0.3% How Chief Executives hate to have to announce poor figures and will do their utmost to try and justify calling a fall, a rise. At least the second half performance was better than the first where the decline was twice as large, at 2.9%, The European business showed a leap of 17,3% but only 2.2% was organic growth and 15.1% was due to exchange rate benefits.
Plant Impact PIM expects strong growth in the use of Veritas in Brazil, with revenue for 2017 expected to rise from from £7.2m in 2016 to between £8.5 and £9m. The prospects for 2018 are even brighter with revenue expected to be around £13m.
Conviviality CVR is increasing its full year dividend by 33% to 12.6p per share. after what the company claims was a transformational year, with all areas of the business performing strongly, revenue rising by 85% and profit before tax by by 147%. The success has continued into the new financial year with sales for the nine weeks to 2nd July showing further growth of 9% compared to last year.
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Plant Impact fears Impact
Plant Impact PIM fears that 4th quarter revenue could be affected by talks which are taking place with Bayer Cropscience about its minimum required purchase volumes for Veritas in Brazil, third quarter revenue for which rose from £0.5m last year to £2.4m this year. The result of the talks could impact full year results and also adversely affect next years performance. Revenue for the 9 months to the 30th April has risen by 55% over last year or 30% on a constant currency basis.
Care Tech Holdings CTH is increasing its interim dividend by 10% to 3.3p per share for the half year to 31st March after what it claims was an impressive first half performance which saw revenue rise by 11.3%. Profit before tax fell by 37.5% from last years when the figures included a £5.6m profit on the sale of a fixed asset.. On an underlying basis profit before tax was up by 13.9%. Sustained growth in capacity and revenue is expected to enable the company to achieve its target of annual double digit growth in underlying diluted earnings per share.
Filtronic plc FTC nearly tripled sales in the 12 months to 31st May, with a rise from £13.6m. to £35.4m.. It describes 2017 as a year of tremendous progress in which it achieved both profitability and cash generation, last years operating loss of of £6.8m having been transfomed into an operating profit of £1.7m.
Bonmarche Holdings BON admits that it has failed to execute its plans to modernise and improve its offer to customers at the rate it had aimed for. The failure is laid at the door of internal and external factors for which it does not provide an explanation. Todays preliminary results for the 53 weeks to the 1st April. show store like for like sales slumping by 4.3% and group profit before tax down from £9.6m. to £5.8m. Underlying basic earnings per share fell from 18.3p per share to 10.1p. As for the future it claims to have a compelling proposition and a robust plan.
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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
Photo – Me Raises Interim by 20%
Photo-me International PHTM is raising its interim dividend by 20% after first half results to the 31st October came in ahead of the board’s expectations. Strong growth saw revenue up by 19.2% (4% on a constant currency basis) and pretax profits by 20.2% ( 4.3% on a constant currency basis). The board now expects that full year profits will significantly exceed current market expectations.
Brainjuicer BJU Gross and pre tax profit will both be above current market forecasts following strong second half market trading. The company is changing its financial year end from the 31st December to 31st March but unaudited results will still be published for the current year to 31st December.
Marshalls MSLH The first five months of the second half have produced strong trading in the domestic end market with a rise in revenue of 15%. Order intake and revenue continue to be robust.
Plant Impact PIM Trading in the first quarter has been strong and the company is particularly excited by the success of Veritas, the company’s main soybean crop enhancement product which has accounted for most of the sales.
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