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Quoted Micro 23 September 2024
AQUIS STOCK EXCHANGE
Digital assets investor KR1 (KR1) reported interim revenues from those digital assets improving from £3.91m to £8.72m, although lower gains on disposals of assets meant that the pre-tax profit edged up from £10m to £10.3m. There was £1.5m in cash in the balance sheet at the end of June 2024. NAV was 82.01p/share at the end of June 2024 and this has fallen back to 71.92p/share at the end of July 2024.
Oscillate (MUSH) has signed an agreement to acquire Quantum Hydrogen for £1.4m in shares. The Minnesota exploration acreage has potential for hydrogen gas. There was £500,000 raised at 1p/share. Investee company Shortwave Life Sciences (PSY) announced positive safety results for its proprietary psilocybin-based drug combination.
Equipmake (EQIP) has received an order from Genco Energy, which is a supplier to Kiwi Bus Builders in New Zealand. This covers four zero emission drivetrains for trail electric buses. There are discussions for the supply of more drivetrains.
Food and beverages company Essentially (ESSN) has renegotiated supplier terms and its beverages are being sold in more stores. The Best of Latin was acquired in May. Interim revenues rose from £593,000 to £920,000. The loss was reduced from £400,000 to £236,000.
Macaulay Capital (MCAP) net assets declined from £1.36m to £1.17m in the six months to June 2024. The company has seven portfolio companies.
Mollyroe (MOY) had net assets of £267,000 at the end of June 2024 and that includes cash of £312,000. Management is seeking opportunities.
Telecom fibre optic cable components supplier Unigel (UNX) interim revenues declined from £18m to £14.8m, but higher gross margins mean that pre-tax profit improved from £630,000 to £930,000. Productivity improved and there were greater sales of higher margin products.
IntelliAM AI (INT) has won contracts with Hovis manufacturing sites, and they are worth £100,000 over 12 months.
Wishbone Gold (WSBN) has raised £360,000 at 0.375p. This will provide working capital. New 3D modelling at the Red Setter prospect owned by Wishbone Gold shows a high quality target, plus the structure of a dome target. The assessment of the Western Australia shows gold, some near the surface, and copper resource.
Probiotix Health (PBX) has secured an agreement with Greek consumer business Eifron, which will introduce YourBiotix tablets in early 2025 under its own brand. There will also be other products using Probiotix Health’s core ingredient launched.
Valereum (VLRM) says that its El Salvador subsidiary has obtained a Digital Asset Service Provider licence. This enables it to operate a real world asset ecosystem.
Marula Mining (MARU) reported a higher loss in 2023. There was a £913,000 cash outflow from operating activities. There was also a £1.67m outflow from investing activities. The first manganese export sales have been completed from the Larisoro manganese mine.
Watchstone Group (WTG) had net assets of £5.8m at the end of June 2024. That includes cash of £6.2m, but a return of capital has reduced the cash balance to £1.7m.
Adsure Services (ADS) has declared a final dividend of 0.99p/share. The ex-dividend date is 17 October.
Ananda Developments (ANA) raised £80,000 from a retail offer at 0.3p/share. This is on top of the £2.1m already raised.
Daniel Thwaites (THW) director RAJ Bailey bought 45,000 shares ate 85.05p each and 13,000 shares at 85.25p each. He owns 1.3%. Constantine Logothetis has acquired more shares in SulNOx Group (SNOX) taking his total to 25.1%. William Black and Armstrong Investments has increased its stake in EPE Special Opportunities (EO.P) from 5.1% to 6.02%.
AIM
Steel structures supplier Billington (BILN) was always going to have a tough time maintaining the 2023 figures and interim revenues fell 4% to £57.9m. Pre-tax profit was flat at £4.6m, although building safety products made a higher contribution offsetting a decline in structural steel. Net cash is still £21.9m even after the 33p/share dividend. The second half will not hold up as well. Cavendish has upgraded its 2024 forecast for the second time in six months. Pre-tax profit has been raised from £8.5m to £9.25m, still well down on the 2023 figure of £13.4m.
Digital coupons and loyalty technology provider Eagle Eye (EYE) continues to grow at an impressive rate as more retailers take up its technology with AI providing additional revenue opportunities. In the year to June 2024, revenues were 11% ahead at £47.7m, while pre-tax profit improved from £4.5m to £6.1m. Net cash is £9.1m and it will continue to build up. The five-year target is revenues of £100m.
Judges Scientific (JDG) had a tough first half. Organic revenues were 3% lower with China the weakest market. The international nature of the business helps to offset some of the downturns in specific markets. Pre-tax profit fell 16% to £10.8m. The order book covers 17 weeks of revenues. Panmure Liberum expects a dip in full year pre-tax profit from £31.7m to £30.7m. The recently announced Geotek contract will benefit the 2025 results.
Good Energy (GOOD) continues its transformation into an energy services business, but the real change will not be seen until next year when they start to make a positive contribution. The reduction in energy prices hit revenues of the supply business and profitability. The first half of the previous year was a beneficiary of high gas prices, so it is no surprise that revenues declined sharply from £156.1m to £97.4m. Pre-tax profit slumped from £13.1m to £4.4m.
There is a better outlook for kettle controls and water filtration products supplier Strix (KETL) following significant restructuring and cost cutting in the first half. This led to large exceptional charges. Interim revenues improved 2% to £66.1m and pre-tax profit rose from £6.9m to £7.8m. This excludes the Halopure business, which is up for sale. There were improved profit contributions from all three divisions. There is no interim dividend. Net debt has fallen to £68.8m.
Packaging equipment and automation provider Mpac Group (MPAC) is acquiring BCA Automation for £12.9m in cash and shares. The acquired business focuses on robotics and conveyor systems for food and other sectors, so it fits well with the existing business. The Boston-based business focuses on the packaging area, whereas Mpac is focused on earlier stages of production.
Ceramic and fragrance products supplier Portmeirion (PMP) had flagged the interim figures. Revenues fell 17% and there was a loss of £2m. Costs are being lowered and this has enabled full year estimates to be maintained with pre-tax profit expected to recover from £3m to £4.2m. This will come via cost savings and additional revenues. The dividend is being rebalanced from 3.5p/share to 1.5p/share, but the total dividend for 2024 should be higher than last year’s 5.5p/share.
There was yet another upgrade for Warpaint London (W7L) from Shore Capital following the interim figures today. There was strong growth in Europe and the UK. North America grew slightly but the focus is higher margin business. Gross margins continue to improve. Overall group sales were one-quarter ahead at £45.8m and pre-tax profit jumped from £6.3m to £11m. The full year pre-tax profit forecast has been raised 5% to £24.5m.
Kinovo (KINO) has won an 18-month contract with Hackney council. It is worth up to £12m and covers a range of decarbonisation works on 300 properties. The work should start in the fourth quarter of 2024. There is also another contract with Hackney worth £400,000. This work replaces another contract that is being retendered.
Intermediaries services provider Fintel (FNTL) grew interim revenues from £31.7m to £35.7m, helped by acquisitions. Zeus has updated its forecasts for the most recent acquisition ThreeSixty Services. The 2024 revenues have been raised from £74.3m to £77.5m, while pre-tax profit has been reduced from £18.4m to £17.2m.
DP Poland (DPP) generated like-for-like growth of 22% in the first half and the growth remains above 20% in the second half. Money raised this year is being invested in new Domino’s sites in Poland. There is also growth in franchising with four corporate stores sold to an overseas operator. The loss is reducing, and DP Poland could move into profit in 2025.
Phoenix Copper (PXC) has published the pre-feasibility study for the Empire open pit mine in Idaho. Discounted NPV at 7.5% discount is $87.9m and total cash costs are estimated at $2.44/copper equivalent pound. Over eight years the mine could generate net free cashflow of $153m. Further exploration planning is happening, and equipment is being purchased for the processing site.
Global Petroleum (GBP) has risen on the back of yesterday’s application two additional licences near to an existing Juno licence in Western Australia, where it increased its stake from 70% to 80%. This is near the Havieron project. Precious and base metals targets have been identified that have similar characteristics to the existing licence. The company has appointed Omar Alumad, who it says has a record of identifying early opportunities, as chief executive and Hamza Choudhry as finance director.
Software training services provider Northcoders (CODE) reported a 26% increase in interim revenues to £4.4m. Registrations for courses were at record levels. There was a small interim pre-tax profit. Net cash is £700,000. The corporate business has been rebranded Counter. Investment in the cloud and data analytics means that there will be continued demand for Northcoders’ training and services.
Digital media company Catenai (CTAI) reduced its loss from £196,000 to £13,000 in the six months to June 2024. That is down to the fees earned for the £450,000 convertible loan note investment in oil and gas-focused data analytics company Klarian and reduced costs. Catenai has also moved from net liabilities to net assets. The cash position has improved to £31,500.
Africa-focused energy company Chariot Ltd (CHAR) has completed the drilling of the Anchois-3 main hole. It encountered gas, but gas pays are thinner than pre-drill estimates. The well will be abandoned. The next step for the project is being discussed with joint venture partners.
Rockfire Resources (ROCK) raised £450,000 at 0.1p/share to continue the development of Molaoi zinc silver lead project in Greece. Earlier in the month, the JORC resource was raised by 500% to 1.09 million tonnes of zinc, 260,000 tonnes of lead and 19.1 million ounces of silver. A retail offer to existing shareholders of up to £250,000 managed to raise £82,000.
MAIN MARKET
Motor and property finance lender S and U (SUS) says that motor business remains challenging, although this could improve in the second half if FCA restrictions are removed. Property lending is still growing. The interims will be published on 8 October.
Trading in Hostmore (MORE) shares has been suspended and then cancelled because the company is being placed in administration.
Shipbroker Braemar (BMS) reassured investors about 2024-25 trading. Interim operating profit should be slightly higher than the £7.6m reported in the same period last year. There is £3.3m in cash. Management is confident about the rest of this year and next year despite continued volatility in shipping markets.
DG Innovate (DGI) raised £620,000 at 0.075p/share with management promising to subscribe £200,000 when the energy storage technology developer is not in a closed period. This will fund development of e-drives and energy storage products. It will also help to fund setting up a joint venture with EVage Automotive.
Becket Invest (TAB) has agreed to buy SMT Holdings, which will invest in strategic metals and rare earths used in technology and aerospace.
Andrew Hore
Quoted Micro 18 July 2022
AQUIS STOCK EXCHANGE
Hydro Hotel, Eastbourne (HYDP) increased interim revenues by 882% to £1.82m and this enabled a move from a loss of £383,000 to a pre-tax profit of £22,277. There are cash and deposits of £1.8m.
Hydrogen Utopia International (HUI) has announced a proposed joint venture with AIM-quoted Powerhouse Energy (PHE) in Tipperary, Ireland. This will be a 50/50 joint venture and it will build a plant on a site leased by Trifol Resources. Negotiations concerning the site should be completed over the coming months. Electron Technologies BV has completed the first design phase for the company’s thermal processing system.
AQRU (AQRU) has launched ByBrix in partnership with Blimp Technologies Inc. This new business is involved in the crypto-mortgage market. Blimp has expertise in embedding blockchain technology in the real estate market.
Goodbody Health Inc (GDBY) intends to consolidate ten existing shares into one new share.
Reflexivity Research Ltd has increased its stake in KR1 (KR1) from 7.6% to 20.3%. This relates to a performance fee of £30.1m.
IPGL Ltd, which is associated with Chapel Down Group (CDGP) non-exec Samantha Wren, has acquired 250,000 shares in the wine maker at 19.2795p each. Cadence Minerals (KDNC) chief executive Kiran Morzaria bought 100,558 shares at 9.9p each. This takes his stake to 1.43 million shares. Invinity Energy Systems (IES) executive director Jonathan Marren has acquired 44,101 shares in the battery storage technology developer at 45.35p a share.
Oscillate (LON: MUSH) non-exec Narisha Ragoonanthun has stepped down from the board.
Lift Global Ventures (LFT) has appointed Optiva Securities as corporate adviser. The accounting reference date is changed from May to June.
EPE Special Opportunities Ltd (EO.P) had net assets of 283.05p a share at the end of June 2022.
AIM
Capital equipment manufacturer Mpac Group (MPAC) warned that full year profit will be significantly below expectations. Interim revenues are better than last year, and the order book is higher. However, difficulties sourcing components and delays to the timing of orders have hampered progress. The longer lead times for components and inflationary pressures will continue for the rest of the year. There was cash of £14.5m at the end of 2021, which has enabled investment in inventories. The interims will be published on 8 September.
CMO Group (CMO) slumped to 35p after a profit warning, making it the worst AIM performer of the week. Last year’s placing price was at 132p. The online retailer of building products says revenues in the 27 weeks to June 2022 are 10% ahead, or 2% higher like-for-like. Full year guidance is that 2022 revenues will increase from £76.3m to at least £86m, but previously £95.5m was expected. The EBITDA estimate has been reduced from £5.55m to around last year’s level of £3.7m. Supply problems have increased costs and trading is getting tougher.
TransGlobe Energy Corporation (TGL) is merging with fully listed VAALCO Energy (EGY) to create an Africa-focused exploration and production company. VAALCO is offering 0.6727 of one share for each TransGlobe share. TransGlobe shareholders will own 45.5% of the enlarged group. The transaction is valued at $307m.
A positive first half trading statement from international payments services provider Cornerstone FS (CSFS) initially triggered a bounce back in the share price, but it fell back when the chief executive resigned.
Embedded computer boards supplier Concurrent Technologies (CNC) has received a new order from a global medical technology company. The initial order is worth $2.2m in the first year of product shipments and there should be orders for several years. This further diversifies the customer base away from defence, which was 70% of the revenues of £20.5m in 2021.
Angle (AGL) has raised £20m at 80p a share. The cash will be used to take full advantage of the recent FDA approval for the use of its Parsortix diagnostic technology in harvesting breast cancer cells for analysis. Discussions are ongoing with medtech and pharma companies. The pharma services operation will be expanded, and laboratory developed tests launched. The liquid biopsy market could be worth up to $100bn in the US.
A £3.75m fundraising at 0.5p a share by EQTEC (LON: EQT) was not well received by the market and the share price fell below the offer price. EQTEC raised more than the minimum of £3m that it was seeking. The cash will fund wase to energy projects, including a 9.9Mwe advanced gasification technology facility and 2MW anaerobic plant at Deeside. EQTEC has to invest £2.3m to gain a 32% stake in the company owning the project.
Ironveld (IRON) has raised £4m at 0.3p a share to finance the acquisition and refurbishment of Ferrochrome Furnaces Ltd and may raise up to £1m more. Directors’ loans and fees of £351,000 has been capitalised. Management has raised the cash because it is not certain that Grosvenor Resources will be able to complete the promised cash injection. Shareholder approval is required at a general meeting on 1 August.
Portmeirion (PMP) says interim revenues were 5% ahead at £45m, but it remains cautious about the full year. Shipping costs are reducing, although other costs have risen.
Gaming machine monitors and consoles supplier Quixant (QXT) has increased order intake by more than expected. Interim revenues are 46% ahead at $53.3m. The main growth is in the gaming sector, although the screens business grew by 21%.
Regional legal firm consolidator Knights Group Holdings (KGH) reported full year figures in line with expectations. Revenues were 22% higher at £125.6m, although earnings per share fell nearly 6% to 17.23p because more shares are in issue.
Plant-based polymers developer Itaconix (ITX) increased interim revenues by 124% to $3m. Revenues trebled from cleaning products using the company’s plant-based ingredients, but beauty and hygiene revenues declined due to lower order volumes. There was $900,000 of net cash at the end of June 2022.
MAIN MARKET
Property investor Town Centre Securities (TOWN) is selling its stake in YourParkingSpace app for up to £20.7m. The initial payment is £9.6m with a further £7.5m payable over the next two years. There could be up to £3.6m more payable depending on performance in the 14 months after acquisition. The book value of the stake was £1.47m. A loan of £1.95m will be repaid. A tender offer to acquire four million shares at 185p each has been launched. The tender is well below NAV. Tender forms have to be received by 8 August.
BATM (BVC) has secured a deal with CityFibre, which will pilot the Edgility platform with selected partners. This could lead to a national roll-out. CityFibre wants to increase its fibre coverage to 285 cities in the UK.
Andrew Hore
Quoted Micro 16 May 2022
AQUIS STOCK EXCHANGE
Brewer Adnams (ADB) says that trading is in line with expectation in the first four months of the year. The retail side is trading ahead of the same period in 2019. Sidney Sussex College in Cambridge has reduced its shareholding from 5.27% to 4.22%., while Michael Heald increased his stake from 18.2% to 19.3% by acquiring 3,200 B shares at 8870p each.
Silverwood Brands (SLWD) has made its first investment since joining Aquis last year. Ginger Teleporter is licenced to operate e-scooters and e-bikes in England. Silverwood Brands has subscribed for a convertible loan note of £200,000 with an interest rate of 15%. The conversion price is £28.94. Silverwood Brands directors Paul Hodgins and Andrew Gerrie are also directors of Ginger. Along with another shareholder in Ginger they have agreed to sell shares to Silverwood Brands at a nominal cost if the target valuation is less than two times the original investment.
National Milk Records (NMRP) says third quarter revenues were 4% higher at £5.63m, with all main parts of the business increasing their contribution. Health testing is growing fastest, but it is still less than one-quarter of the total. Milk purchase prices have been increased to cover higher farm costs.
Talent management and livestreaming company All Things Considered (ATC) invested $6m in a new company focused on music digitisation and blockchain technology, which has announced the acquisition of Napster.
Gunsynd (GUN) has sold 175,000 shares in Charger Metals NL, raising £93,000. It still owns 2.825 million shares.
ChallengerX (CXS) has signed a digital asset monetisation agreement with US-based online TV network FOXD. This is a five-year deal.
Hydrogen Utopia International (HUI) says it is in talks with Powerhouse Energy (PHE) about a project in Ireland.
Peterhouse Capital resigned as corporate adviser to Love Hemp (LIFE) prior to the announcement that an investor had not made the promised £1.2m subscription. A new corporate adviser is required for trading in the shares to recommence. A strategic review is ongoing, and a finance director is being sought.
AQRU (AQRU) says that its decentralised finance subsidiary has more than $50m of assets under management five months after the launch of the AQRU.io platform.
SuperSeed Capital Ltd (WWW) managing director sold 50,000 shares at 100p each. He still owns 79.6%.
EPE Special Opportunities Ltd (ESO) had net assets of 355.46p a share.
AIM
There have not been any large contract wins for telecoms billing software provider Cerillion (CER) this year, but the interims show the benefit of previous wins. In the six months to March 2022, revenues increased from £12.8m to £16.1m. Annualised recurring revenues are £9.8m. Underlying pre-tax profit jumped from £3.8m to £6.3m. The business is highly cash generative and net cash has reached £16.5m. There are no borrowings. The dividend has been raised by 24% to 2.6p a share. Although the order book has dipped from £42.1m to £39.7m it is still well above previous years. There is a weighted pipeline of prospective customer business of £35m and there is a good chance that some deals could be secured before the end of September.
Motor dealer Vertu Motors (VTU) had an exceptionally strong 2021-22 due to the delayed demand for cars due to lockdowns in the previous year. The figures were ahead of expectations. Revenues were £3.62bn, which is 18% higher than in 2019-20. Pre-tax profit jumped from £24.6m to £80.7m. The profit should more than halve this year. Supply shortages are continuing, although used car prices are set to come down over the rest of the year.
Omnichannel retail software provider itim Group (ITIM) has annual recurring revenues were £11.1m in 2021 and it has already reached £13m this year. Clients pay a monthly fee. There was a £1m pre-tax profit in 2021 and investment in growing the business means that it could halve this year. The company raised cash so that it could finance the replacement of an existing system with its own software without charging an upfront fee.
Healthcare technology investor and adviser Netscientific (NSCI) increased net assets to £18.5m at the end of 2021. There are 22 investments in the portfolio. WH Ireland has a sum of the parts valuation of 180p a share.
Trellus Health (TRLS) has changed its strategy to focus on the direct-to-consumer model and is broadening the market by including irritable bowel syndrome (IBS). Trellus Health can provide personalised care for people with chronic conditions with the initial focus inflammatory bowel disease (IBD). There should be initial revenues in 2022. Net cash is $32m and this should last more than two years as revenues build up.
Plug-in cards developer Concurrent Technologies (CNC) says component shortages held back revenues and they dipped from £21.1m to £20.5m in 2021. Even so, pre-tax profit improved from £3.7m to £4.1m thanks to lower operating expenses. Chief executive Miles Adcock joined the AIM-quoted company last June. He has reviewed strategy plans to launch new products more quickly. This year there should be eight new products – double the previous level. A manufacturing partner in the US will help the group win more business. Although there was an increased interim dividend, the total dividend for the year was unchanged at 2.55p a share.
Advanced coatings provider Hardide (HDD) is recovering but it is still some way from profit. Interim revenues were 50% ahead at £2.7m and while the loss was nearly halved it was still £771,000. Revenues for the year to September 2022 could be double the interim level, but so could the loss. Net debt was £335,000 at the end of March 2022. Overheads have fallen following the completion of the move to a new factory in the UK. Variable gross margin is 70%, so additional revenues will rapidly reduce the loss.
Further good news from NWF (NWF) thanks to the fuels business due to short-term volatility. Trading in the year to May 2022 will be significantly ahead of expectations.
Credit hire and legal services firm Anexo (ANX) increased 2021 revenues by 36% to £118.2m, while pre-tax profit was 50% ahead at £24.1m. The new housing disrepair business made a contribution, and the credit hire business is running at high levels. There is still potential upside from the VW emissions case. The total dividend is 1.5p a share.
Iodine producer Iofina (IOF) increased 2021 revenues from $29.7m to $39m and underlying pre-tax profit from $1.3m to $4.9m, even though iodine production was lower. Net debt was $3m at the end of 2021. Iodine prices remain above $60/kg. Plans are being made for additional production capacity.
Duke Royalty (DUKE) has raised a further £20m via a placing and PrimaryBid offer at 35p a share. The additional cash should enable Duke to increase its debt facility by £25m. Cenkos forecasts royalty revenues of £21.3m in the year to March 2023. That should generate enough cash for a 3p a share dividend.
Immedia Group (IME) has completed the disposal of its operating business and it is changing its name to Immediate Acquisition.
Sweden-based investor AB Traction has increased its stake ceramics and fragrance products manufacturer Portmeirion (PMP) to 5.08%.
MAIN MARKET
GS Chain (GSC) is a shell seeking a technology acquisition. It was introduced to the standard list at 1p a share. The share price opened on 13 May at 3p before ending the day at 3.625p (3.5p/4p). There is nearly £1m in cash that should last 12 months. The pro forma asset value is less than 0.18p a share.
Macfarlane (MACF) says first quarter sales and profit are ahead of the same period last year. Better packaging sales to industrial and hospitality sectors has offset weaker sales for e-commerce.
Flavours supplier Treatt (TET) grew revenues by 9% to £66.3m, although underlying pre-tax profit fell to £6.3m. Forecast revenues have been upgraded, but the profit estimate is the same due to lower margins. Orange oil prices have risen.
Andrew Hore
Quoted Micro 21 March 2022
AQUIS STOCK EXCHANGE
AIM-quoted OptiBiotix Health (LON: OPTI) plans to float its ProBiotix Health subsidiary on the Aquis Stock Exchange and distribute 35%-37% of the shares to its shareholders. ProBiotix, which develops probiotics for treating cardiovascular disease, is expected to have a pre-money valuation of £22.5m and will join the market on 31 March. There are plans to raise £2.5m. OptiBiotix will retain just under 50% of ProBiotix. Peterhouse is corporate adviser.
Oberon Investments (OBE) says revenues will be at least £6.4m in the year to March 2022. Funds under management have grown to more than £1bn and that has been wholly organic growth. Oberon is launching an EIS fund and an IHT service.
Natural food and snack products supplier S-Ventures (SVEN) has been making acquisitions since it floated. This means that the figures for the year to September 2021 are not a good indication of the group as it is currently made up. They show revenues of £1.53m and loss of £1m. Additional warehousing has been secured so that all the group’s requirements can be fulfilled by this site. Two centres have been closed.
National Milk Records (NMRP) has secured an exclusive licence for the exploitation of GenoCells technology in the US. The test can detect mastitis and is being piloted in the UK. The roll out of the test should start at the beginning of 2023.
SuperSeed Capital (WWW) says that SuperSeed Fund II raised £31m. There is a strong pipeline of investment opportunities.
Altona Rare Elements (ANR) is proceeding with phase 2 of the development of the Monte Muambe real earths project with resource drilling that will last for 12 months. This will produce a maiden mineral resource estimate and will cost £1.2m.
Semper Fortis Esports (SEMP) has set up a blockchain-based paly-to-earn gaming division called SMPR Guild. The subsidiary will buy in-game items in the form of NFTs, and active game players can access these items on a revenue share basis. Game-based token rewards are won during playing and they are split between the player and the company.
Cadence Minerals (KDNC) has completed the acquisition of a further 7% of Pedra Branca Alliance, which gives it a 27% interest in the Amapa iron ore project.
Clean Invest Africa (CIA) has raised £100,000 at 0.5p a share and for every two shares an investor receives a warrant exercisable at 1.5p. If these warrants are exercised, then another warrant will be issued that is exercisable at 3p a share.
Chris Akers has increased his stake in Quetzal Capital (QTZ) from 18.3% to 19.1%.
AIM
CleanTech Lithium (CTL) raised £5.6m at 30p a share when it joined AIM. The share price ended the week at 35.5p. The company has potential lithium projects in existing mining areas of Chile. This means that there is nearby infrastructure. CleanTech Lithium has an extraction process that is more environmentally friendly than alternatives. Owning 100% of each of the projects (there is currently an option over part of the Laguna Verde area) provides additional flexibility for financing. There should be updated resource figures during the summer and that will enable a pre-feasibility study to be conducted.
Ceramics and fragrance products manufacturer Portmeirion (PMP) returned to profit in 2021. Group revenues increased from £87.9m to £106m, while underlying pre-tax profit jumped from £1.4m to £7.2m. There was a rebound in revenues in South Korea. Total dividends were 13p a share. Long-term energy contracts have been secured to offset higher gas prices this year. Further profit improvement is expected this year. Healthcare had a strong year helped by Covid, but management believes that spending will
Recruitment firm Empresaria (EMR) bounced back in 2021 even though the aviation recruitment business remained in the doldrums. This shows the benefits of the wide spread of activities both in terms of sector and internationally. Revenues recovered from £54m to £59.5m, while underlying pre-tax profit jumped from £5.2m to £8.6m. This reflects the benefits of investment in group management and resources and there is more to come. Further roll out of IT will also help. Revenues and profit are well below the peak in 2018. The offshore recruitment services division is moving into the Philippines market. There has been a strong start to 2022.
Restore (REST) improved its pre-tax profit by 64% to £38.1m with demand for all parts of the business returning last year. Acquisitions did help the technology business to grow sharply but there was also 5% underlying organic growth for the group as a whole. There are spare bank facilities to fund more acquisitions this year as Restore moves towards its goal of £450m-£500m, which is double the 2021 level.
Packaging and automation equipment supplier Mpac (MPAC) did better than expected in 2021. The 13% improvement in revenues to £94.3m was mainly down to the acquisition of Switchback. Pre-tax profit grew from £6.3m to £8.6m. net cash was maintained at £7.6m. The focus on the healthcare and food sectors has helped Mpac to prosper and the international spread of business is another positive. There is a 26% like-for-like increase in the order book, which was £78.4m at the end of the year.
Tracsis (TRCS) is paying £10.9m, plus up to £2.1m deferred, for rail technology software provider RailComm, which generates revenues of £4.6m. Tracsis had already won a remote condition monitoring equipment contract in the US and the focus will be gaining further contracts for this technology, as well as for software.
Energy efficiency as a service provider eEnergy Group (LSE: EAAS) increased interim revenues by 42% to £9.6m, partly due to energy management acquisitions. Energy efficiency revenues fell during the first half because the corresponding period included work that had moved into that period due to lockdowns. Solar is a sector where management is keen to expand exposure.
Gfinity (GFIN) is raising more cash to cover its losses, but they be near to coming to an end. The esports business is raising a further £2.7m at 1.25p a share, having regularly raised money since joining AIM in 2014. A loss is expected this year, but a reduction in admin costs should help Gfinity to make a profit in 2022-23.
Corporation Financiere Europeenne has increased its bid for CIP Merchant Capital (CIP) from 55p a share to 60p a share. This is still a significant discount to NAV and the bid has been rejected, but the bidder already owns 35.2% and has acceptances of 1.3% of the share capital. Castellain Capital has doubled its stake in CIP to 11.1%.
MAIN MARKET
New Energy One Acquisition Corporation (NEOA) is a cash shell seeking to acquire a business involved in the energy transition sector. It raised £175m at £10 a share. The only real asset is the cash raised in the flotation. The current share price is 989.5p.
Cash shell CYBA CYBA) has acquired its first cyber security business Narf Industries for $25.6m in cash and shares. Narf provides vulnerability research and security protocol design, as well as developing its own cyber security software. A placing raised £6m to help finance the purchase. The placing price of 2p was above the market price, but by the end of the week the price was 2.3p. CYBA may also acquire Polyswarm, although the exclusivity period has ended. CYBA director Steve Bassi is the principal shareholder of the Polyswarm businesses. The estimated cash balance is currently £2.79m. The company is licensing SRI International’s IP that is used in the Narf developed threat intelligence for grid recovery product. SRI will take a stake in CYBA.
Housebuilder One Heritage Group (OHG) has issued £1.5m worth of unsecured corporate bonds and has obtained a standard listing for them. The bond has an annual coupon of 8% and matures in March 2024. The cash will be used to repay loans outstanding from One Heritage SPC, which have an annual interest rate of 12%. There will be a £1.2m loan left that expires in August 2023.
Property investor Town Centre Securities (TOWN) improved underlying net assets to 305p a share, from 284p a share – a 2.4% increase in portfolio value plus help from share buy backs. Three property sales generated £22.5m in the six months to December 2021. There have been subsequent deals. The current loan to value is 47.7%. A 2.5p a share interim dividend is being paid.
Raven Russia (RAV) intends to sell its Russian property assets but retain outstanding loans. Trading in the shares has been suspended and the listing will be cancelled so that the option to sell the assets can be triggered.
Path Investments (PATH) has published the prospectus for the reverse takeover of DG Innovate, which is developing drive and battery technology. The initial consideration is £32.4m in shares at 0.6p each. There is conditional deferred consideration of up to £5.4m depending on the signing of additional customers. Path has raised £2.55m at 0.5p each and warrants exercised at 0.25p each to raise a further £2.08m.
Andrew Hore
Andrew Hore – Quoted Micro 25 March 2019
NEX EXCHANGE
Good Energy (GOOD) increased full year revenues from continuing operations from £104.5m to £116.9m, helped by last winter’s cold weather and a price increase, and pre-tax profit recovered from £700,000 to £1.7m. The renewable electricity supplier and generator has increased its dividend from 3.3p a share to 3.5p a share. Net debt was £40.1m at the end of 2018. Energy supply volumes increased by 3%, but domestic volumes were 1.2% lower in an increasingly competitive market. The growth came in the business side, which increased volumes by 23%. Good Energy generates energy from six solar sites and two wind farms. The company expects to continue to grow business volumes and invest in digital technology. Non-executive director Nemone Wynn-Evans has bought 9,500 shares at 105p each.
Trading in PCG Entertainment (PCGE) shares has been suspended because it is in talks to acquire VOX Markets and Align Research.
Karoo Energy (KEP) has been told by its potential nominated adviser does not believe its is suitable for an AIM quotation. This also means that the planned fundraising cannot go ahead. A refinancing is required. There are trade creditors of around £300,000. Trading in the shares has been suspended.
Primorus Investments (PRIM) has maintained its 3.4% stake in Fresho by participating in its latest fundraising, which was at a 76% premium to the price paid for the initial investment. The investment is worth A$673,000.
Dana Group International Investments Ltd (DANA) reported swing from loss of $129,000 to a profit of $95,000 in the six months to December 2018, due to other income of $276,000.
Tectonic Gold (TAU) says that roc chip samples from the Clermont project in Queensland show up to 8.01g/t gold, 140g/t silver and 6.32% copper.
Panther Metals (PALM) has completed the acquisition of Parthian Resources and its former shareholders own 16.1% of Panther.
Inqo Investments Ltd (INQO) has raised a further £225,000 at 90p a share.
Imperial X (IMPP) has changed its focus to medicinal cannabis. There was a small cash outflow in the six months to the end of December 2018. There was nearly £70,000 in the bank with net cash of £19,000. There are net liabilities and more cash will be required later this year.
Steve Howson is stepping down as chief executive of SG Recruitment Ltd (SGRL) and he will become a non-executive director. Majority shareholder David Sumner will be interim chief executive.
AIM
Footasylum (FOOT) has recommended a 82.5p a share bid from JD Sports Fashion (SPD) which values the footwear retailer at £90.1m. JD Sports was buying shares between 50p and 75p and built up a 18.7% stake. The bidder promises to maintain the separate commercial identity. Footasylum floated in November 2017 at 164p a share.
Diaceutics (DXRX) ended the week at 97.5p, having floated at 72p. The company provides data analysis and advisory services to pharma companies seeking to develop and commercialise diagnostic tests. There were £15.2m of placing proceeds net of expenses and £5.5m will be spent on the acquisition of data, while the rest will be used to pay off debt and develop AI analysis technology. There is limited liquidity in the shares because they are tightly held.
Wynnstay Group (WYN) warns that trading in the second quarter is weak because of the warmer winter weather. There has also been a weakening in farmgate prices. Interim figures will be well below the first half of last year and the full year will be below forecast. Peel Hunt argues that it has already factored these elements into its forecast for rival feed supplier NWF (NWF) and it is not changing its forecasts.
Pelatro (PTRO) has launched a data monetisation platform with a revenue share contract with an existing client, which is worth $500,000 in the first year. This is a product that can be sold to other customers.
Financial trading platform Aquis Exchange (AQX) reported 2018 revenues ahead of expectations and it doubled its market share during the year. The subscription-based model means that higher trading levels by a trader lead to subscription income levels going up. Aquis will continue to be loss-making this year, but the relatively fixed cost base means that once this is covered the profit should grow significantly as revenues grow.
Scientific instruments supplier Judges Scientific (JDG) increased is cash generation from operations from £10.9m to £15.7m in 2018. There was 5.5% organic growth in revenues and underlying operating profit rose by just over one-third to £14.7m. The cash balance has increased to £15.7m, which provides firepower for acquisitions. Shore Capital has edged up its earnings per share forecast from 188.8p to 190p.
Volvere (VLE) says full year revenues from continuing operations will rise from £16.2m to £18.6m. There was a £23.1m gain on the sale of Impetus Automotive. There was an underlying loss on continuing activities, but the frozen pie maker Shire Foods improved its profit contribution. There is £34.1m of cash in the Volvere balance sheet.
Frontier IP (FIPP) says that the outcome for the year to June 2019 is likely to be ahead of management expectations. A deal by investee company Exscientia, which is involved in AI-based drug discovery, with Celgene Corporation should result in a substantial uplift in its valuation.
Science in Sport (SIS) had a 25-day contribution from the profitable PhD Nutrition business in 2018. The group’s underlying loss increased last year, but PhD will help to reduce the loss and the cash outflow from operations, which was £6.42m last year. There is £8m in the bank and even with capital investment requirements that should be enough to cover requirements this year.
Ceramic products supplier Portmeirion Group (PMP) increased its 2018 pre-tax profit by 10% to £9.7m and a further rise to £10.3m is forecast for this year. Online sales are growing rapidly from a relatively low base. The home fragrance business is doing well, and capacity is being added. The total dividend is 8% higher at 35.7p a share.
Share (SHRE) improved its significantly improved its profitability in the second half of 2018, although trading levels weakened towards the end of the year. That weakness has continued into the early months of this year. Evan so, Cenkos forecasts a rise in pre-tax profit from £700,000 to £1.3m, upgraded from £1.1m, in 2019.
Clear Leisure (CLP) has placed its 50%-owned data mining operation in Serbia on a care and maintenance basis. This is due to the fall in the price of cryptocurrency. Legal actions and negotiations continue concerning a number of past investments. Clear has paid £76,000 for a 10% stake in PBV, which provides data services for the Italian legal sector. At the end of 2018, there were €2.1m of bonds converted into shares.
Andrew Perloff has increased his stake in 600 Group (SIXH) from 6.19% to 8.85%.
Midatech Pharma (MTPH) has changed the ratio of its ADRs from two shares for each ADR to 20 shares for each ADR. This is a way of getting the trading price of the ADRs on NASDAQ back above $1.
EQTEC (EQT) could be a beneficiary of the deal done by its largest shareholder EBIOSS with Urbaser for the collection, treatment and possible conversion of waste to energy. Urbaser is conducting due diligence on EQTEC’s gasification technology and this could be used for any waste to energy plant if all three parties come to an agreement on a specific opportunity. Projects could be in Bulgaria, Greece, Macedonia and Romania.
A local authority report has placed a five year reserve status on the Plymouth Airport site where Sutton Harbour (SUH) has a 135 year lease. The local authorities are keen that the site should be used for general aviation, but a viable business plan needs to be put together. Sutton Harbour would like to develop the site.
Tau Capital (TAU) has sent a circular to shareholders concerning a capital return of $1.19m or 2.42 cents a share, raise $150,000 via a placing at 0.1 cents a share and change its name to UK Onshore. Reverse takeover candidates are being assessed. Gerwyn Williams and Nigel Burton will join the board.
Synectics (SNX) has won a £1m order from the oil and gas sector. This is the largest order for its surveillance systems from this sector for a number of years. Synectics reported a rise in full year revenues from £70.1m to £71.2m and pre-tax profit slipped from £3.02m to £2.86m. The full year dividend is increased from 4p a share to 4.7p a share.
MAIN MARKET
Athelney Trust (ATY) has responded to the letter from former director Dr Pohl, who wants to regain his place on the board along with Simon Moore and remove David Lawman. Dr Pohl has acquired more than 100,000 shares in the past month, and this means that five shareholders own more than 50% of the investment company putting its investment trust status at risk. As long as there is more than 35% of the company held by the public this is not a problem, but it would be if Dr Pohl joined the board. There have been £90,000 of extra costs because of disputes between the two major shareholders. The plan remains to bring Gresham House on board as fund manager
WideCells Group (WDC) is changing its name to Iconic Labs and moving into digital marketing and technology. The management of this business previously built up social publisher Unilad. In the first 12 months, an agency consulting division will be launched to assists clients to develop brands. There are plans to build up a distribution and publishing division through acquisitions and launch content licensing and e-commerce divisions. There is little indication of what will happen to the stem cell operations, although management appears to believe that the insurance business could be worth pursuing. Historic liabilities are being resolved. The convertible loan note holder continues to convert a proportion of the loan note that is below 30% and then sell the shares. There are 785.6 million shares in issue with more to come.
Bluebird Merchant Ventures (BMV) has raised £436,500 at 2.25p a share. The cash will be used for the pre-construction phase of the South Korean gold projects. An agreement has been made with a local landowner for the use of land outside the main entrance of the Kochang mine.
Highlands Natural Resources (HNR) has raised £1.56m at 8.5p a share via an offer through PrimaryBid.com. This cash will fund a move by the natural resources company into the organic cannabidiol market. It has established Zoetic Organics in the US and it believes that hydrogen produced by Highland in Kansas can be used as a fertiliser with potential to increase the size of the plant. First revenues could be achieved in the summer.
Standard list shell Stranger Holdings (STHP) claims that Alchemy Utilities Ltd has sabotaged the proposed reverse takeover by refusing to provide audited accounts. Stranger is trying to get back the £300,000 it lent to Alchemy as well as its reverse takeover costs of £450,000. Stranger believes that the Alchemy management team may have misrepresented its financial status. An alternative acquisition is being lined up, but Stranger had negative net assets at the end of September 2018 and there are additional costs since then.
Standard list shell Hertsford Capital (HERT) still had £2.88m in cash at the end of 2018.
Telecoms services provider Toople (TOOP) is growing its gross profit but EBITDA is similar to the same period last year, which was around £650,000.
PV Crystalox Solar (PVCS) has ended its wafer production activities in Germany and it intends to apply its wire sawing expertise to cutting non-silicon materials. There are plans to return £38.5m to shareholders, which is equivalent to 24p a share and that is not far short of the current market price. That could still leave more than €10m of cash. Management is considering whether to maintain a listing.
Sure Ventures (SURE) says 23%-owned Suir Valley Ventures has maintained its 10% stake in WarDucks, which is developing an AR game, by participating in a €3.3m fundraising.
Andrew Hore
Andrew Hore Quoted Micro 4 March 2019
NEX EXCHANGE
Proton Partners International (PPI) joined NEX on 28 February and from day one it became one of the largest companies on the market. The introduction price was 225p, valuing the proton beam therapy provider at £334m, and the share price ended the week at 2275p (210p/245p). Woodford-related interests own 41.9% of Proton (www.proton-int.com) and they invested £20m at 200p a share on admission and promised to invest up to £80m at a maximum price of 176p each. Woodford received a further £1m worth of shares at 200p each in consideration for these arrangements. Proton is four years old and it has completed three centres offering proton beam therapy for cancer patients with another planned in Liverpool. Each cancer centre has cost between £35m and £42m. There is also a cancer diagnostics subsidiary. In the eleven months to January 2019, revenues were £1.11m and the loss was £18.6m.
Formation Group (FRM) owns 4.35 million shares in Proton Partners International, which it acquired in March 2018 at 115p each. The 225p a share flotation price means that the value of the 2.85% stake has nearly doubled to £9.78m. At Formation’s AGM, the resolutions to reappoint Grunberg and Co as auditor and for the board to authorise its remuneration were not passed. Michael Kennedy has resigned from the board.
Trading in Dozen Savings (DS01) 5% secured bonds March 2020 commenced on 1 March. So far £91,000 worth have been issued. The plan is to raise up to £7m. The company has been created to offer the bonds to customers of its financial services-focused parent company, Project Imagine (www.projectimagine.com). The bonds cost £100 each and the price at the end of the first day of trading was £107.50 (£90/£125). The FCA has granted Project Imagine an e-money licence and an investment licence.
IFA consolidator AFH Financial (AFHP) says that trading is in line with expectations in the first four months of the year. Past acquisitions are achieving more than 90% of their deferred consideration targets.
Field Systems Designs (FSD) reported a lower profit in the six months to November 2018 because of delays in energy form waste business. Two of these projects have still not been completed. Sales to the water sector have been strong, but they are likely to decline as the latest water regulation AMP6 period. In the six months to November 2018, revenues were flat at £11.8m, but pre-tax profit fell from £168,000 to £46,000.
Sandal (SAND) reported a dip in interim revenues from £1.88m to £1.73m and that led to a swing from profit to loss. EnergieMiHome home automation product sales were lower than expected but the products are being sold in more outlets.
Ace Liberty and Stone (ALSP) has spent £6.17m on two properties that are both let to the Communities and Local Government department, as Jobcentre Plus centres, on leases with an unexpired term of 8.4 years. The property in Bolton cost £2.54m and has a net initial yield of 7%. The Northampton site cost £3.63m and has a net initial yield of 6.75%.
Milamber Ventures (MLVP) says that investee company Essential Learning has been placed in liquidation after problems with historic data led to the company losing its government-funded training contracts. Milamber invested £228,000 in Essential in a two year period and provided services worth £270,000. It also issued £100,000 worth of shares to Essential minority shareholder Goldvista Properties. Goldvista has loaned Milamber £310,000 and this is likely to be converted into shares. Goldvista’s £6,000 loan to Essential has been written off. The shares issued to Gravity Investment Group for a 15% stake in Essential have been cancelled. Milamber is conducting due diligence on apprenticeship training businesses.
Inqo Investments Ltd (INQO) has raised £1m at 90p a share and the cash will be used to invest in healthcare, education and eco-tourism businesses in Africa that are two-to-three years from profitability and have a positive social impact.
Trading in Via Developments (VIA1) debentures has been suspended because the accounts for the year to September 2018 have not been published.
Karoo Energy (KEP) says it intends to move to AIM “as soon as practically possible”. A general meeting has been called for 18 March in order to gain shareholder approval to issue shares at the time of the move.
Altona Energy (ANR) has left AIM and the board intends to visit a vanadium mine in China that could become part of a joint venture. Altona still intends to invest in the Arckaringa coal project in South Australia.
John Eckersley is stepping down as chief executive of Capital for Colleagues (CFCP) in order to focus on his role as managing partner of Castlefield Partners and Alistair Currie will become chief executive.
AIM
Internet of Things products supplier LightwaveRF (LWRF) is raising up to £3m through a placing, subscription and open offer at 8.5p a share. Year-on-year growth in sales in the first quarter was 156% taking the figure to £1.15m.
Churchill China (CHH) and Portmeirion (PMP) have bought the stake in ceramic materials supplier Furlong Mills that was previously owned by Dudson. Churchill has paid £454,000 for 9.5%, which takes its stake to 55.6%. This means that Furlong will be consolidated in Churchill’s figures. In 2017, revenues were £8.6m and pre-tax profit was £500,000. Portmeirion spent £363,000 to take its stake to 44.4%.
President Energy (PPC) is raising up to £6.5m at 8p a share, including a £2.8m debt for equity swap by the chief executive, to invest in its gas infrastructure and accelerate its drilling programme.
Itaconix (ITX) has secured an exclusive global supply agreement with Nouryon for bio-based polymers used in hair care, skin care and cosmetics. This contract comes after a joint development agreement with Nouryon and follows the previous supply agreement for polymers used in detergents. Nouryon will sell the polymers to its own customers in the personal care sector for use in their consumer products.
Audioboom (BOOM) is raising £1.5m at 1.3p a share and this cash will enable the podcast company to make upfront payments for content. Audioboom says that it is on course to achieve higher revenues in 2019 than in the 13 months to December 2018. The success in generating revenues and orders is helping to attract content providers.
Parity (PTY) has won a two-year contract with the Department for Education for the digital transformation of the Funding and Contracting Service, which makes £6bn of payments each year. The deal could be worth up to £4.5m. Matthew Bayfield has taken over as chief executive of Parity from Alan Rommel, who is chief operating officer. Bayfield plans to focus more on the data consultancy activities.
Westmount Energy Ltd (WTE) is nearly doubling its shareholding in JHI Associates Inc to 3% and the investment is 81.8% of Westmount’s gross assets. JHI’s main asset is a 17.5% carried interest in the Canje block, offshore Guyana, which is operated by ExxonMobil. The first well could be drilled by early next year.
Verona Pharma (VRP) used up £18.1m of cash in its operating activities in 2018. There is still £64.5 in the bank. Verona generated positive data for ensifentrine (RPL554) used as a treatment for COPD in a phase IIb clinical trial. The focus is COPD and further trials for cystic fibrosis are unlikely in the short-term. Financial resources will be focused on progressing the nebulised ensifentrine to a phase III study. Verona is likely to seek partners for its dry powder and pressured meter dose inhaler formulations. The results of the part one of the dry powder inhaler clinical trial for COPD could be available before the end of the first quarter. The second phase should then commence with results expected in the second half of the year.
Trading in Herencia Resources (HER) shares has been suspended because it appears that pre-conditions for the financing that has been negotiated are not likely to be met. More cash is required to enable the company to continue trading.
Telematics supplier Quartix (QTX) increased its fleet sales, but insurance business fell and overall revenues profit are set to decline in 2019. In 2018, revenues were £25.7m and pre-tax profit was £8.1m, but that figure is forecast to fall to £6.5m this year.
VietNam Holding Ltd (VNH) has published a prospectus for its move to a premium listing, which should happen on 8 March.
Adamas Finance Asia Ltd (ADAM) has commenced a share buy back scheme for up to $500,000 of shares at a maximum price of 79 cents a share, which is a 25% discount to pro forma NAV. Adamas has separately agreed to buy back 730,529 shares at 10 cents each. The first tranche of 159,847 shares has been issued to China Aerospace for its stake in Hong Kong Mining.
NetScientific (NSCI) says that it will not get the required backing for the resolution to cancel the AIM quotation, so it has adjourned its general meeting. Shareholders owning more than 30% are against the plan.
MyCelx Tech (MYX) has raised $1.83m at 230p a share in order to finance the potential increase in demand for water treatment services.
Telit (TCM) has sold its automotive division for $105m and has received $67.5m in cash, but it has granted the buyer a loan of $38.5m for a six week period because other debt finance was not obtained in time.
MAIN MARKET
Air Partner (AIR) says that its pre-tax profit will be at least £5.8m in the year to January 2019. The charter division was boosted by strong demand for freight and commercial jets. The consulting and training division has won new contracts.
G3 Exploration Ltd (G3E) plans its third demerger in its time as a quoted company. This time shares in Green Dragon Gas, which owns its producing assets, will be distributed to shareholders. Green Dragon Gas will then either be sold or float on the Hong Kong Stock Exchange.
Wealth manager Walker Crips Group (WCW) says that political uncertainty has hit broking commissions and the launch of new products, which means that the 2018-19 results will be lower than for 2017-18. Chief executive Sean Kin Wai Lam has bought 15,000 shares at 28p each.
Laura Ashley (ALY) has rejected the bid approach by Flacks and says that the indicative offer of 2.748p a share fails to provide a fair value for shareholders.
London Finance and Investment Group (LFI) has a 43.8% stake in NEX-quoted Western Selection. In the six months to December 2018, NAV fell from 65.4p a share to 62p a share. The interim dividend is unchanged at 0.55p a share.
BigDish (DISH) has launched a new restaurant bookings website and upgraded its technology. It is also widening its coverage to include Southampton.
Path Investments (PATH) says that the period of exclusivity included in its heads of agreement with ARC Marlborough has been extended to 29 March. The plan is to acquire ARC, which has a nickel and cobalt project in Queensland, via a share issue.
Oil and gas firm Curzon Energy (CZN) has raised £95,000 at 1.58p a share, which is a 21% premium to the market price. The cash will be invested in a gas project in Texas.
Andrew Hore
Andrew Hore – Quoted Micro 21 January 2019
NEX EXCHANGE
Sport Capital Group (SCG) is acquiring Italian football club Palermo for a nominal sum. The deal also includes the project for a new stadium for the Serie B team, which is currently five points clear at the top of the table. Promotion back to Serie A would boost revenue generation and it would also trigger an earn-out payment. There is also potential for more sponsorship and match revenues. There is a plan to raise up to £10m from a bond issue that would be traded on NEX.
Clinical decision support technology provider DXS International (DXSP) reported a lower interim loss in the six months to October 2018. Revenues edged up from £1.61m to £1.69m and the loss declined from £92,000 to £35,000. Tax credits meant that there was a post-tax profit of £70,000, up from £28,000. The GPSoC tender has been delayed but it is expected to be completed this year.
Coinsilium Group Ltd (COIN) says that its priorities for 2019 are to demonstrate the potential of the blockchain investments that it has and to take advantage of the growing sector. There were record levels of investment in the blockchain sector last year. Management wants movements in the share price to reflect progress rather than the movement of the price of bitcoin, as has been the case in the past year.
KR1 (KR1) has set up a subsidiary in Gibraltar. KRX Ltd will sponsor token-based projects that will list on the Gibraltar Stock Exchange, which operates the first regulated blockchain exchange. The subsidiary will generate fees from clients and there are a limited number of sponsors.
AFH Financial Group (AFHP) has acquired fellow wealth management firm Hayburn Rock for up to £3.5m. The initial payment is £900,000. In 2017, the firm made a profit of £400,000.
TechFinancials (TECH) is selling its stake in MarketFinancials, which no longer trades, for €100,000. The investment had no value on the balance sheet.
Smaller company investor Gledhow Investments (GDH) had £167,000 in the bank at the end of September 2018, having made a small profit in the period. The NAV is £793,000.
Ashley House (ASH) is changing its year from April to June. This is the end of the first six months period for joint venture Morgan Ashley Care Developments LLP. There will be interim results for the six months to October 2018 reported at the end of January.
NQ Minerals (NQMI) has commissioned the Hellyer processing plant and in the fourth quarter generated £3.2m of revenues from lead, zinc and pyrite.
Ascent Resources (AST) is attempting to raise cash at 0.3p a share, which is a 20% discount to the market price, via PrimaryBid.com. Ascent has successfully raised cash via the platform in the past. The broker handling the deal is Stanford Capital Partners. Ascent, which has €400,000 in the bank plus a deposit for a bank guarantee of €200,000, is refocusing its expansion outside of Slovenia because of regulatory hold ups in the country. Revenues from the export of gas from Slovenia totalled €2.1m in 2018 but gaining permission to process the gas and sell it to the national grid has proved difficult.
Knights Group Holdings (KGH) has acquired Leicester-based legal services business Cummins for £1.57m in cash and shares. This fits well with the existing east Midlands operations. In the six months to October 2018, group revenues were 37% ahead at £23.9m and organic growth was 10%. Underlying pre-tax profit doubled to £4.4m. The maiden interim dividend is 0.6p a share. Net debt was £9.5m at the end of October 2018. Average fees per fee earner was one-quarter higher at £66,000.
Concrete levelling equipment supplier Somero Enterprises Inc (SOM) did better than expected last year. The 2018 pre-tax profit forecast has been raised by 5% to $29m. Net cash is $25m and 50% of the excess over $15m will be paid in a special dividend on top of the ordinary dividend. Somero has also paid $2m for concrete pouring and line dragging company Line Dragon and this broadens the product range.
Student accommodation activities fuelled the growth of Watkin Jones (WJG) last year but private rental will become increasingly important from this year onwards. Richard Simpson has taken over as chief executive.
Kromek (KMK) is making progress towards breakeven and it has plenty of cash in the bank to take it there. The imaging and radiation detection technology developer has a strong order book. There was a dip in first half revenues because of the transfer of production to a new site in Pittsburgh. Even so, full year revenues are forecast to increase from £11.8m to £15m and the loss should reduce from £2.5m to £1.9m.
Tri-Star Resources (TSTR) is selling its antinomy exploration interests in Turkey. The company’s main asset is the 40% shareholding in the Sohar antinomy and gold production facility in northern Oman. Some engineering problems have to be sorted out before the plant is fully up and running. More cash will be required. The venture has requested $10.5m from its shareholders.
The market was disappointed by news from Verona Pharma (VRP) about the clinical trial results for COPD treatment Ensifentrine (RPL554). Two different does were used in combination with Stiolto Respimat. The treatment did work better than the placebo, but the improvement in breathing was not statistically significant. The share price slumped by more than one-third, although there was a small subsequent recovery.
CH Bailey (BLEY) has decided to cancel its AIM quotation and it is asking for shareholder approval. The company is offering to buy back shares at 100p each via a tender offer.
Ariana Resources (AAU) says that its 50%-owned Kiziltepe mine produced 27,110ounces of gold in 2018. Ariana expects its $33m development loan to be fully repaid during 2019.
Tax Systems (TAX) had reduced net debt from £20.5m to £13.9m by the end of 2018. Pre-tax profit of £5.8m is forecast for 2018.
Ideagen (IDEA) is acquiring Cork-based Scannell Solutions, which provides environmental health and safety software, for £3.5m. Annualised revenues are around €1m, of which, two-thirds is recurring.
Consumer engagement technology provider Pelatro (PTRO) has confirmed that 2018 figures are in line with expectations and there was improved cash generation in the second half. Net cash was $1.8m at the end of 2018. finnCap expects 2019 pre-tax profit to double from $2.9m to $6m.
Plexus Holdings (POS) plans to buy back 4.95 million shares owned by LLC Gusar. The price will be 50.5p a share. Gusar will use the cash to buy two POS-GRIP wellhead systems, which it announced it was going to buy one year ago.
Midwich Group (MIDW) has acquired MobilePro AG, which expands the audio visual products distributor into Switzerland. The business has annual revenues of CHF25m.
Pharmaxis has completed a toxicity study for two LOXL2 inhibitors in which Synairgen (SNG) has a 17%carried financial interest. Pharmaxis can brief potential licensing partners with the information gained.
Tracsis (TRCS) is acquiring Compass Informatics, which is a data analytics and systems development business. Tracsis is paying up to €5.15m for the Dublin-based company, which made a pre-tax profit of £600,000 last year.
Portmeirion Group (PMP) has achieved record sales in 2018 and beat the profit forecast of £9.5m. The fastest growth came in the home fragrance division.
Iofina (IOF) achieved record iodine production levels in the second half of 2018. Full year production was 17% higher at 588.8 million tonnes. There should be a further rise in production this year and that could move Iofina into profit.
Brandon Hill has initiated coverage of Karelian Diamond Resources (KDR) and it has valued the company’s Lahtojoki diamond project in Finland at $32.9m, based on an average diamond price of $100/carat.
The People’s Operator (TPOP) has postponed the appointment of an administrator as negotiations with interested parties continue.
Kestrel Opportunities has increased its stake in Pebble Beach Systems (PEB) from 22.2% to 23.1%. Little more than one year ago the stake was below 15%.
Caledonia Mining Corporation (CMCL) has cut 2019 gold production guidance for its Blanket Mine and WH Ireland has downgraded its forecast from 61,200 ounces to 55,500 ounces, which is at the higher end of the guidance. There was 54,5000 ounces of gold produced in 2018.
MAIN MARKET
Athelney Trust (ATY) is holding the requisitioned general meeting on Tuesday 22 January. Robin Boyle has requisitioned a general meeting in order to get himself reappointed. He left the board last year after a disagreement over the future of the investment company. He wanted to stay on as a non-executive director to shepherd the change in investment management for the trust. The plan is to get Gresham House involved in the investment management. Boyle also wants David Lawman and Paul Coffin to be appointed and the three existing directors, Dr Emmanuel Pohl, Simon Moore and Jemma Jackson, to be removed.
Path Investments (PATH) has signed heads of agreement with ARC Marlborough. The plan is to acquire ARC, which has a nickel and cobalt project in Queensland, via a share issue. Path had £31,000 in the bank at the end of June 2018.
Challenger Acquisitions Ltd (CHAL) has agreed to sell its $300,000 investment in the Dallas Wheel project back to the developers. Challenger has received $27,000 in interest and will receive $50,000 a month, plus interest, for six months.
Gresham Technologies (GHT) has sold its VME mainframe software business for £2m.
Shefa Yamim (SEFA) has sufficient cash to finance continued exploration in the first quarter of 2019. By the middle of the year the gems explorer will be able to estimate how much cash it requires to start trial mining.
Andrew Hore
Ian Pollard: Dart Group To Substantially Exceed Expectations In 2019
Dart Group plc DTG is proposing to increase its final dividend by 54 % after strong passenger growth for both Jet2.com and Jet2holidays saw revenue for the year to the 30th June increase by 38%. Profit before tax rose by 49% and basic earnings per share by 44%. Demand has strengthened even more since the start of the new financial year and having regard to current forward bookings Group profit before foreign exchange revaluations and taxation for the year ending 31 March 2019, will substantially exceed current market expectations.
ASOS plc ASC retail sales for the four months to the 30th June grew by 21% on a constant currency basis, slightly down on the ten month figure of 23%. In the UK market share continued to increase and full year profit for 2018 is expected to be in line with consensus.
Computacenter CCC Following a strong start to the year, momentum has continued into the second quarter and The first half has shown considerable progress in adjusted profitability, and even further progress in adjusted earnings per share. Trading result for 2018 will now be comfortably in excess of previous expectations.
GYG plc GYG Trading has been significantly weaker than expected in the half year to the 30th June due to lower than expected project wins and some additional delays in anticipated contracts. Full year revenue is now expected to be flat and adjusted EBITDA to be materially below the Board’s expectations at approximately €5 million. There is however grounds for optimism for the the immediate future as the New Build Order Book stands at €13.4 million for 2019 and €5.6 million for 2020 compared to a meagre 1m only a year ago.
Portmeirion Group PMP updates that total group sales for the six months to the 30th June have increased by 11% or, on a constant currency basis, 15%.
Telford Homes TEF updates that the London Market has remained robust since the year end in May although, as a sign of the times, the average selling price of open market homes is expected to remain constant. The strategy of concentrating on build to rent homes is believed to be the correct one.
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Andrew Hore – Quoted Micro 21 May 2018
NEX EXCHANGE
Newbury Racecourse (NYR) grew 2017 revenues from the nursery, hotel and media operations. There was a 11% increase in raceday attendances, which totalled 196,000 last year, leading to a 1% like-for-like rise in revenues. Overall revenues were 5% higher at £17.8m, while underlying pre-tax profit edged up from £178,000 to £188,000. There was a small cash outflow from operations. Capital investment meant that cash was reduced from £12.9m to £5.2m with more payments to come from the David Wilson Homes deal. A further £5.17m will be spent on upgrading the Pall Mall stand. There are concerns that the cutting of maximum stakes for gaming machines following the recent government announcement could hit bookmaker sponsorship and media rights revenues.
Block Commodities Ltd (BLCC) has a secured a strategic investment from Swarm Fund, which is a decentralised marketplace platform using blockchain. Investors will be able to participate in the FarmCoin asset-backed investment coin via the Swarm platform. FarmCoin is a joint venture between FinComEco and Block Commodities focused on the agriculture sector. There will be up to $45m of FarmCoin tokens issued.
National Milk Records (NMR) is holding a general meeting on 4 June in order to propose a reduction in capital that should put it in a position to have distributable reserves if it wants to pay a dividend.
Pre-IPO investor Primorus Investments (PRIM) had cash of £561,000 at the end of 2017. The NAV was £4.95m. This was after a £3.26m inflow from share issues.
AIM
Watkin Jones (WJG) has found a new chief executive but he will not be able to start until the beginning of 2018. Richard Simpson is joining from student accommodation developer Unite Group. The build to rent operations of Watkin Jones has secured a development arrangement for a site in Reading, which will have 315 apartments.
GAN (GAN) and Webis (WEB) are two companies that could benefit from the legalisation of online sports betting in the US. The Supreme Court of the United States has decided to overturn the Federal prohibition of sports betting. US sports betting could be worth $6bn by 2023. That covers online and onsite gambling. GAN can launch a sports betting service in New Jersey and Pennsylvania in the second half of this year – in time for the NFL season. GAN already has a deal with Betfair in New Jersey and adding sports betting will increase revenues. Webis has a US subsidiary called WatchandWager, which is based in California, a strong potential market for sports betting.
Genedrive (GDR) has agreed to sell its research and pharmacogenomics divisions to a director for up to £1.9m so that it can concentrate on its core Genedrive diagnostics platform. The initial payment is £1.15m with the rest deferred and subject to claims for R and D tax credits.
Lakehouse (LAKE) is acquiring heating and renewables services provider Just Energy Solutions, which fits with the company’s gas compliance businesses in the public sector and expands coverage in the industrial and commercial sectors. There is no upfront cost and payments will be dependent on profitability over two years. Lakehouse has also won a £55m, three year, Warm Homes contract with the Wales government.
Oil and gas demand is recovering at advanced coatings provider Hardide (HDD) but it is still well below previous levels. Other customers are enhancing growth and aerospace business is on the horizon. Interim revenues were 43% higher at £2.16m but the company is still loss-making. That will continue for a couple of years.
Angling Direct (ANG) increased revenues by 44% to £30.2m in the year to January 2018 and this led to an upgrade in forecast revenues for the current year. The fishing tackle retailer grew online sales by 54% but these tend to be lower margin. Pre-tax profit was £900,000 and it is expected to rise to £1.1m this year.
Online women’s fashion retailer Sosander (SOS) says that its full year revenues will be at least £1.34m. Like-for-like sales in the fourth quarter nearly quadrupled and gross margins are improving.
Portmeirion (PMP) has increased revenues by one-fifth in the first four months to 2018, although the second half of the year is always the more significant. Full year profit is still forecast to rise from £8.8m to £9.4m.
Churchill China (CHH) says that trading is ahead of the same period last year. The ceramic products manufacturer continues to have success in Europe and other export markets.
A new patent application has been filed for SkinBiotix by SkinBiotherapeutics (SBTX) and this covers the increasing of filaggrin levels in skin. Filaggrin is required for the formation of the outer layer of skin. Eczema sufferers have a low level of filaggrin.
The People’s Operator (TPOP) is increasing its UK subscribers but US numbers have declined so the performance was down in the first quarter of 2018. Churn is declining. Margins are better than expected. Even so, progress is too slow and an alternative strategy is required by the virtual mobile network business and it is considering divesting the US subscribers. That should cut cash burn by one-third.
A bathing water test by Molendotech, which is one of the investee companies of Frontier IP Group (FIPP), is being launched by Halma. This follows the agreement earlier this year.
Altona Energy (ANR) will begin a drilling programme on the Westfield tenement of the Arckaringa coal project during August. There could be 100mt of coal in the tenement. It will take three weeks to drill 15 holes to a depth of 120 metres.
Active Energy Group (AEG) intends to acquire a controlling interest in PowerWood Canada. Which owns forestry assets in Canada. This will secure feedstock for the roll-out of CoalSwitch, the biomass replacement for coal. There are plans to construct a 25 tonne per hour CoalSwitch plant in Alberta.
Servoca (SVCA) wants shareholders to agree to the cancellation of the AIM quotation. Management says that this will save £150,000 a year.
Volex (VLX) is buying Silcotec Europe for €18.1m and raising £36m at 75p a share. Silcotec supplies harnesses and electronic sub-assemblies to the medical, telecoms and computer industries and generated an operating profit of €3.1m.
Audioboom (BOOM) is not going ahead with the reverse takeover of Triton Digital Canada Inc because it could not raise the cash from a placing. A £700,000 break fee in cash (£90,000) and shares is payable. The audio business still requires more cash and that is why trading in the shares is still suspended.
MAIN MARKET
Sportech (SPO) has a strong presence in the US so it is in a good position to benefit from the legalisation of sports betting. It already has 90 licenced operator clients and its own network of off-track betting facilities in Connecticut.
The reasons behind founder Laurence Orbach increasing his stake in books publisher Quarto Group Inc (QRT) to 20.1% have become clear. Orbach was removed from the board in November 2012 but he has joined with 27% shareholder Lion Rock to unseat four non-executive directors at the AGM. Orbach and former finance director Mick Mousley have returned to the board, along with two nominees from Lion Rock. Orbach becomes executive chairman.
Shefa Yamim (SEFA) has completed bulk sampling in zone 1 and this should enable a resource estimate to be calculated.
Standard list shell Papillon Holdings (PPHP) has signed heads of terms for a 50% stake in CarCloud, a car sales-based fintech company. The deal to acquire energy storage systems developer Phestor is off. That follows the abortive takeover of Myclubbetting.
S&U (SUS) says non-prime car finance applications are 10% higher this year, although approval rates have fallen. Net receivables have increased by £48m to £258m.
North Midland Construction (NMD) has made a strong start to the year. There is a secured workload of £310m for this year and this should enable an improved financial performance this year.
World Trade Systems (WTS) wants to diversify its business outside of China. A new Taiwan-based health and fitness subsidiary is being incorporated. Kun Xin International will provide a loan facility of up to £3m to finance the new business. European opportunities are being sought.
Blood diseases treatments developer Hemogenyx Pharma (HEMO) has signed a development agreement with a global pharma company, which will provide Hemogenyx with free technical support and some intellectual property. The pharma company will be granted a research licence for anything jointly developed.
Andrew Hore
Ian Pollard – Momentous year for Cineworld #CINE
Cineworld CINE found 2017 to be not only exciting but also the most momentous since its foundation in 1995 as it once again produced record results and took the first steps towards turning itself into the second largest cinema chain in the world with the acquisition of Regal entertainment Group for $3.4bn. This was a transformational acquisition, now completed, which gave it a total of over 9,500 screens. Profit before tax rose by 22.7% and basic earnings per share by 18.7% enabling the full year cash dividend to be increased by 14.5% plus a final rights adjusted dividend of 3.1p er share.
Savills plc SVS delivered a strong and improved performance in 2017 and is raising dividends for the year by a total of 4% to to 30.2p per share. Group revenue rose by 11% and on a statutory basis profit before tax increased by 13% and basic earnings per share by 20%. The strength is attributed to the resilience of the residential market, geographical diversity and strength in key commercial markets.
Kier Group KIE is increasing its interim dividend for the six months to the 31sr December by 2% after an 8% rise in revenue, 3% in basic earnings per share and 4% in profit before tax. The good performance is claimed to reflect the strength of the business model coupled with financial and operational discipline. Double digit profit growth is expected for 2018.
PZ Cussons PZC Following January’s announcement that first half trading performance in the UK and Nigeria had been constrained, things have not improved and a warning has had to be issued that full year profit will now fall short of expectations and profit before tax will be in the region of 80 to 85 million pounds. Despite the continuation of low consumer confidence and high competition in most of the company’s markets, a return to profitable growth is forecast for the following year.
Portmeirion Group PMP produced its ninth consecutive year of record group revenue in the year to 31st December and is celebrating with an increase of 7.5% in full year dividends. Profit before tax rose by 13%, basic earnings per share by by 9.2% and revenue. by 10.6%. The success is attributed to strong growth and diversification in export markets.
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