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Quoted Micro 27 November 2023
AQUIS STOCK EXCHANGE
Guanajuato Silver (GSVR) produced 787,086 ounces of silver equivalent and the loss fell by one-fifth to $7m when compared with the second quarter. The all-in sustaining cost increased to $26.22/ounce due to changes in mining and temporary closures.
SuperSeed Capital (WWW) generated 78% IRR combined from two exits. There were £220,000 of realised gains in the nine months to September 2023. There is £430,000 of cash on the balance sheet. NAV is 112p/share.
Vinanz Ltd (BTC) has teamed up with Luxor Technology Corp to improve its bitcoin mining operating efficiency. Luxor’s firmware improves mining margins when profitability is low and can increase a machine’s hashrate when profitability is higher.
Wishbone Gold (WSBN) has secured an option to acquire 100% of the Crescent East lithium and gold project in the Mosquito Creek area of Western Australia. Shares were issued at 1.25p each to pay the £25,000 option fee.
Fuel additives developer SulNOx Group (SNOX) has successfully demonstrated the effectiveness of drop-in fuel conditioner SulNOxEco in the shipping sector. Monaco-based dry-bulk ship management company Marfin Management trialled the additive onboard a 60,000 MT DWT bulk carrier over a three-month period. This showed improvements in fuel consumption.
Cadence Minerals (KDNC) says investee company Hastings Technology Metals has agreed a $50m equity funding facility for the Yangibana rare earths project. Hastings Technology Metals can draw down up to $50m from Alpha Investment Partners to provide working capital for the development of the mine. Project financing talks are progressing and there have been offers from potential partners and debt providers. Cadence Minerals has a 1.4% stake in the investee company.
Steve Xerri, who owns 4.81%, has been appointed as an executive director of Oscillate (MUSH) and he intends to focus on special situations either through individual investments or via a reverse takeover.
One Health Group (OHG) has gained two new contracts with NHS Trusts. One is to supply orthopaedic services and the other is for orthopaedic and gynaecology services. They will help to reduce waiting lists.
Apollon Formularies (APOL) says Sproutly Canada has completed due diligence on the acquisition of the company’s global cannabis-related assets in return for 49% of the enlarged share capital of Sproutly Canada. The effective valuation is likely to be around £4.2m. Regulatory approvals are required.
Kasei Holdings (KASH) has a digital asset portfolio worth $2.07m at the end of October 2023.
EDX Medical (EDX) has entered into a collaboration with Thermo Fisher Scientific. They will jointly develop and commercialise cancer diagnostics.
Looking Glass Labs (NFTX) has raised $1m at $0.10/unit – one share and one warrant exercisable at $0.10/share. A further ten million units have been swapped for $1m of debt. Further sources of finance are being sought.
Quantum Exponential Group (QBIT) has appointed VSA Capital as corporate adviser, while Pharma C (PCIL) has appointed First Sentinel as its corporate adviser.
Res Privata NV has increased its stake in NFT Investments (NFT) from 3.33% to 4.09%.
AIM
Telecoms enterprise software provider Cerillion (LON:CER) grew strongly last year, while the rate of growth might slow this year it is still likely to make good progress given the recent €12.4m contract win. In the year to September 2023, revenues were one-fifth higher at £39.2m, while underlying pre-tax profit was two-fifths ahead at £16.8m, helped by a reduction in impairment charges from £1.77m to £256,000. The growth has come from software with a dip in services revenues. Net cash reached £24.7m at the end of September 2023. The dividend has been raised from 9.1p/share to 11.3p/share.
Light Science Technologies (LST) is acquiring the Injecta Fire Barrier trade and assets from Fire Barrier International. The Injectaclad product expands when heated and prevents the spread of fire and smoke. There is no initial payment with consideration in the form of a deferred profit share agreement. The deal should be earnings enhancing and generate cash. There are maintenance and installation synergies with the contract electronics subsidiary. The cash generated will help to finance the growth of the group.
Video games developer Team17 Group (TM17) says 2023 trading is slightly better than expected, although some titles are not performing as well as anticipated and that has hit margins. There has also been overspending and delays on some development projects. That means that underlying EBITDA will be around one-sixth lower than forecast at around £40m. Some titles are being reassessed and that is likely to lead to impairment charges of up to £11.5m.
Parity (PTY) announced the sale of its remaining business yesterday afternoon. It will become a cash shell. Parity will receive up to £3m depending on working capital adjustments for recruitment business Parity Professionals. The deal costs will be £240,000. There will be £639,000 including costs spent to settle the pension liability and finance the search for an alternative business. The company will change its name to Partway.
Velocys (VLS) is the worst performer on the day after the sustainable fuels company said that there is a potential bid at 0.25p/share from a consortium including Lightrock and Carbon Direct Capital Management. This would ensure long-term funding of the business. The low share price makes it difficult to finance the sustainable fuels operations. The share price dived 63.7% to 0.25p, which values Velocys at £4.5m. A large multiple of that value needs to be raised to fund development and production. Interim funding will be required.
musicMagpie (MMAG) is in bid talks with BT Group (BT.A) and asset manager Aurelius. The talks are at an early stage.
Cyber software and services provider Shearwater Group (SWG) appears set to return to profit this year. The core software businesses have been integrated, as have two of the three consultancy businesses. In the six months to September 2023, revenues dipped from £10.8m to £10.5m. That was due to much lower software revenues. Even so, gross profit improved and, stripping out amortisation and exceptionals, the underlying loss reduced £493,000 to £93,000. That is before restructuring costs. The cost savings will show through in the second half.
Telecoms testing instrumentation supplier Calnex Solutions (CLX) has been hit by a reduction in spending by telecoms companies. In the six months to September 2023, revenues slumped from £12.7m to £7.8m and the company moved from a pre-tax profit of £3.1m to a loss of £600,000. Trading did not pick up in September as is normally the case. Non-telecoms revenues make up one-quarter of total revenues. The cost base is being kept steady in expectation of a recovery, even though that may not be until the next financial year. There is £13.5m in the bank.
There were no revenues from systems in the first half at SRT Marine Systems (SRT), but that will change in the second half when transceivers revenues will be well below the systems contribution as work on contracts reaches points where revenues can be invoiced and recognised. Interim revenues fell from £18.8m to £5.5m, although transceivers revenues were higher. Last year’s loss could be turned into a £7.2m profit this year.
Battery technology developer Ilika (IKA) has achieved its D4 development point for the Goliath battery. This is the start of turning the development into a battery product. Ilika will be able to create P1 samples for testing by customers. At the end of the week, Ilika confirmed that its interims will be in line with expectations with revenues of £1.3m and there is £13.2m in cash left.
Neometals (NMT) has completed the A$9m from a placing at 10p/share and wants to raise a further £6.8m from a one-for-eight entitlement offer. The cash will fund the development of the nickel, cobalt, lithium recycling business Primobius, including the delivery of a facility to Mercedes Benz, and potentially to purchase a stake in Canadian licensee Stelco.
Empire Metals (EEE) has released initial results for the first diamond drillhole at the Pitfield project in Western Australia. This shows significant grades of titanium oxide. There will be results from two more diamond drilling holes in the coming weeks. A further 6,000 metres of drilling is planned with more likely early next year. Copper is still potentially in the area as well.
Interim figures from diagnostics company Cambridge Nutritional Sciences (CNSL) showed the benefits of concentrating on its core personalised health and nutrition business. Revenues rose 44% to £4.9m and the loss was reduced. Production problems have been sorted out. There was strong growth in North America as management puts more resources into the region. A small full year loss is expected.
Lifestyle concierge services provider Ten Lifestyle (TENG) has moved into profit for the first time. It swung from a loss of £2.7m to a pre-tax profit of £3.2m thanks to economies of scale. There was also a tax credit recognised due to past tax losses. Investment in its digital platform and the international spread of business is helping Ten Lifestyle. New contract wins will help to increase this year’s pre-tax profit to £3.9m, according to Singer.
Gold explorer Oriole Resources (ORR) has announced heads of terms with contractor BCM International for the development of the Bibemi and Mbe gold projects in Ghana. BCM can earn up to 50% of the Bibemi project by making a cash payment of $500,000 and commit to spend $4m on the project. BCM will pay $1m in cash and spend a further $4m to earn a 50% stake in Mbe project.
Mercia Asset Management (MERC) has exited one of its older investments, raising £30.2m – a 2.7 times return on invested capital. Virtual reality games developer nDreams has been acquired by Aonic for £90.3m. This was Merica Asset Management’s largest investment and £3.8m of the proceeds are being reinvested in Aonic. The consideration was 17.5% ahead of the March 2023 valuation.
Duke Royalty (DUKE) generated a 17% increase in recurring cash revenues to £12.2m with a 35% increase in all cash revenues to £14.1m. During the period, Duke Royalty made one of its biggest initial investments in glass architectural products supplier Glasshouse Products. The $11.5m investment is backing a member of the original founding family buying back the business.
Maritime AI provider Windward (WNWD) has signed a five-year contract with a European national coastguard that is valued at €3.2m. The cash is expected to be paid upfront, while annual contract value will be increased by $700,000/year.
MAIN MARKET
Structural steel supplier Severfield (SFR) reported lower interim revenues, but a higher profit. In the six months to September 2023, revenues were 8% lower at £215.3m, but underlying pre-tax profit improved 17% to £14.2m. This includes an unchanged contribution of £600,000 from the India joint venture, while the modular products business made a maiden profit. The interim dividend was raised 8% to 1.4p/share. The UK and Europe order book is worth £482m, even though the £50m contract for Hertfordshire-based film studio Sunset Studios has been delayed.
Standard list shell Tertre Rouge Assets (TRE) is attempting to raise up to £50m to buy rare cars and acquire cash generative businesses involved in supercar events. Around £30m is set to be invested in a range of cars that have already been identified. They are worth between £1m and £10m. The plan is to generate gains on these investments -15% annual returns are targeted – while hiring them out to photoshoots and other income generating activities to cover overheads. The Run To Group Ltd, which organises supercar adventures to the Monaco Grand Prix, will also be acquired and management will remain with the business. The group’s board of directors includes racing drivers and business men and they can expand this business and others. There will be cash left over to buy other companies.
Packaging manufacturer and distributor Macfarlane Group (MACF) says lower volumes and prices meant that revenues fell 2% in the nine months to September 2023. New customers are being attracted and this will help future volumes. Margins are increasing.
Seraphim Space Investment Trust (SSIT) improved its NAV to 96.5p/share at the end of September 2023. That was helped by positive currency movements and a small uplift in valuations, predominantly due to a fundraising by an investee company.
Andrew Hore
Quoted Micro 20 March 2023
AQUIS STOCK EXCHANGE
MBH Corporation (LON: MBH) joined the Access segment of the Aquis Stock Exchange on 13 March. The shares have previously been traded on the Frankfurt Stock Exchange and the Dusseldorf Stock Exchange. Trading started on Aquis at 7p (5p/9p) and it stayed at that price all week. There were no trades. MBH has subsidiaries in a wide variety of sectors. They include, education, construction, transport, health, engineering, property, leisure and food.
Capital for Colleagues (CFCP) is investing £1m in A ordinary shares in automotive engineering and manufacturing start-up Morris Commercial, as part of an £8m investment round. The investment is in three tranches with an initial outlay of £500,000. The full investment will be made by the end of 2023. The initial product is the Morris JE electric van, which is based on the design of the Morris J-Type van.
Quantum technology investment company Quantum Exponential Group (QBIT) welcomes the Chancellor of the Exchequer’s plan for quantum technology. There will be investment of £2.5bn over ten years. This should help to increase investor interest in quantum.
Chapel Down Group (CDGP) believes that changes to UK duties are positive, because of the support for English sparkling wine producers. Chapel Down, along with Shepherd Neame (SHEP) have signed a partnership deal with The Boat Race, which happens on 26 March.
Macaulay Capital (MCAP) has taken over the management of the unquoted portfolio of Chelverton Asset Management.
Kasei Holdings (KASH) is still waiting for £350,000 from the February 2023 fundraising. Management hopes that this cash will be received in the next few days.
Coinsilium Group (COIN) is acquiring the advisory business and certain intellectual property assets of Tokenomi for £116,500 in cash and shares. There are four retained Web3 blockchain project clients with a further ten prospective clients. Revenues could be £551,000 over the next 12 months.
IamFire (FIRE) has subscribed a further £200,000 for convertible loan notes in WeShop, taking the total invested to £2.7m. The total amount invested in WeShop is £6.7m and there is the right to subscribe for a further £1.05m of loan notes. The conversion price is 200p. John Lewis and Sports Direct have recently become affiliated to WeShop.
Altona Rare Earths (ANR) has ended trading on Aquis. Trading starts on the standard list on 20 March. Forbes Ventures left Aquis on Friday, although it intends to acquire a litigation financing business and return to the quoted arena.
Silverwood Brands (SLWD) is still experiencing opposition to the transfer of shares in skincare products supplier Lush. Silverwood Brands holds the rights to the shares even if ownership is not registered.
Ananda Developments (ANA) has raised additional subscription funds at 0.3p a share, taking the total to £427,000.
Res Privata NV has sold its 3.83% stake in NFT Investments (NFT). Mark Horrocks has increased his shareholding in Lift Global Ventures (LIFT) from 7.1% to 11%.
EDX Medical (EDX) non-executive chairman Jason Holt bought 400,000 shares at 3025p each. Incanthera (INC) chief executive Dr Simon Ward has subscribed £115,000 for shares at 6.95p each.
Guanajuato Silver Company Ltd (GSVR) has secured a $5m silver and gold pre-payment facility, which replaces the current facility.
Snacks manufacturer S-Ventures (SVEN) says the audit for its figures for the year to September 2022 will last until the end of April, so trading in the shares will be suspended on 3 April.
Essentially Group (ESSN) joined Aquis on 17 March. The brief announcement claims that the prospectus is on the company’s website, but it is impossible to find.
AIM
Hurricane Energy (HUR) has agreed a bid from Prax Exploration & Production, which values the oil and gas producer at up to £249m. There will initially be a 3.32p a share transaction dividend and cash consideration of 0.83p a share, totalling 4.15p a share. There is then a supplementary dividend of 1.87p a share. Shareholders will also receive a deferred consideration unit worth up to 6.48p a share. The deferred consideration is based on 17.5% of future net revenues earned by Hurricane between 1 March 2023 and 31 December 2026. The deferred consideration will be paid twice a year in arrears.
MTI Wireless Edge (MWE) grew revenues of each of its three divisions and two of them made a higher profit contribution. An initial contribution from communication and monitoring systems developer PSK WIND Technologies, offset the loss of Russian distribution business. In 2022, group revenues improved from $43.2m to $46.3m, while underlying pre-tax profit rose from $4.04m to $4.32m. The total dividend is 3 cents a share. Net cash was $8.14m at the end of the year. The profitability of the Antennas division is recovering.
Cloud-based secure payments technology provider PCI-PAL (PCIP) grew interim revenues by one-third to £7.3m. North American growth was particularly strong. Total annualised contract value is £14.7m. The full year loss is likely to be around £2.2m. Legal costs due to the patent dispute meant that net cash fell to £1.9m, but it has risen since December. There should be no problem with the accounts at Silicon Valley Bank.
Digital coupons and loyalty technology provider Eagle Eye (EYE) reported the expected interims and says that full year results will be better than expected. The pre-tax profit forecast has been edged up from £3.5m to £3.8m and the 2023-24 figure has been edged up to £5m. Net cash could reach £5.3m at the end of June 2023. There should not be any problems arising from the Silicon Valley Bank collapse, although there are still cash deposits in the bank.
Verditek (VDTK) has signed an exclusive supply agreement to supply solar panels to building and roofing products supplier Lindab Profil AB. They will be sold in the Nordic and eastern European markets. The exclusivity depends on the sale of panels of 850kw in 2023.
Cordel (CRDL) has won an important contract with Amtrak in the US. The six-and-a-half year contract is valued at $6.7m. There will be $1m recognised in 2022-23 and $2m in 2023-24, with rest coming in the remaining time of the contract. Cordel’s technology will be used to capture and manage data on clearances of surrounding rail infrastructure.
Redx Pharma (REDX) merger partner Jounce Therapeutics has received an unsolicited offer from Concentra Biosciences. Cancer treatments developer Redx Pharma recently announced the merger with Jounce Therapeutics and the AIM company’s shareholders would own 63% of the enlarged group.
Purplebricks (PURP) has received a possible offer from Strike Ltd, although it is not yet part of the formal sale process and has not entered into a non-disclosure agreement.
Reabold Resources (RBD) has been approached by Kamran Sattar on behalf of an affiliate of Portillion Capital which could lead to a bid at a 10% premium to the previous day’s closing price of 0.2035p. The board believes this offer undervalues the oil and gas investment company. It recently sold the Victory gas discovery to Shell and intends to return £4m to shareholders.
Circle Property (CRC) announced a return of capital through a B share issue with a second distribution to follow. The company has nearly completed the sale of its property portfolio. The first distribution of 158p a share (£46.2m) will be on 21 March. A second distribution of 58p a share should be made in April. There will be a much smaller distribution when the final disposal is completed. An incentive payment of £620,000 is being paid to each executive.
Digital mental health company Kooth (KOO) has won a significant contract in California covering 13-25 year olds. Services will be provided to the Behavioural Health Virtual Services Platform, and they will launch in January 2024. Specific terms are still to be finalised, but there should be a material impact on annualised recurring revenues from 2024.
Condor Gold (CNR) is entering the end of the first phase of the process to sell the La India gold project in Nicaragua. There are three formal expressions of interest, including two non-binding offers, with more likely to be received. The project requires $105.5m of investment and has an estimated NPV (5%) of $86.9m.
MAIN MARKET
Structural steel supplier Severfield (SFR) is expanding in Europe through the acquisition of steel fabrication company Voortman Steel Construction Holding for €24m. The Netherlands-based company will provide greater access to the northern European market.
Data integrity and banking integration software provider Gresham Technologies (GHT) is accelerating the growth of its Clareti software. Group revenues grew from £37m to £48.7m in 2022. That was helped by currency movements and a full year contribution from post-trade processing software supplier Electra, but there was still strong organic growth. The fastest growth was in the US. Pre-tax profit improved from £4m to £6.9m. Singers forecasts a 2023 pre-tax profit of £7.4m. with flat earnings due the corporation tax rate rise, increasing to £9.6m next year.
Harwood Capital has increased its stake in RM (RM.) from 8.88% to 10.4%, including 9.18% held by Rockwood Strategic (RKW). Theodore W King’s stake has risen from 7.36% to 8.25%.
Andrew Hore
Quoted Micro 28 November 2022
AQUIS STOCK EXCHANGE
One Health Group (OHGR) joined the Apex segment of the Aquis Stock Exchange on 24 November. The NHS-funded medical procedures provider raised £1.56m at 150p a share, giving One Health Group a market capitalisation of £15.1m. The share price ended the week at 156.5p. Demand for the company’s services should continue to be strong as the NHS tries to reduce the backlog of operations. In the six months to September 2022, revenues were £9.7m. The plan is to pay 50% of post-tax profit in dividends. Net cash was £3.68m at the end of March 2022. The additional cash will provide working capital.
Electric vehicle drivetrains developer Equipmake Holdings (EQIP) edged up revenues by 3% to £3.71m in the year to May 2022. A much greater proportion of the revenues came from commercial and production contracts. The loss was more than trebled to £5.2m. There was still £1.88m of cash in the balance sheet and since then it raised £10m gross at 4.25p a share in its Aquis flotation. A partnership with an electrical aerospace specialist will generate initial orders for prototypes worth £400,000.
VSA Capital (VSA) has reiterated that it will report a first half loss. The Aquis corporate adviser is holding a showcase event for Aquis companies on 29 November.
Inqo Investments (INQO) has sold its investment in Zambia-based honey producer Bee Sweet Honey There was a ZAR950,000 loss on the investment.
Guanajuato Silver (GSVR) has made a partial early repayment of its silver and gold loans using 97,000 ounces of silver and 846 ounces of gold. In the three months to September 2022 produced 329,297 ounces of silver and 3,226 ounces of gold, while lead and zinc sales have become significant. The trend of quarter-on-quarter production increases is expected to continue.
Clarify Pharma (PSYC) has acquired £250,000 stakes in Nasdaq-listed companies Atai Life Sciences Inc (ATAI) and Compass Pathways (CMPS). Both companies are involved in developing psychedelic treatments.
AQRU (AQRU) is reducing the number of employees by three-quarters to save money. Monthly overheads will fall by 65%. Yields on the company’s cryptocurrency app are being reduced.
Cooks Coffee Company (COOK) has issued up to NZ$2m of convertible notes to wholesale investors. The cash will fund the growth of the café existing chain and acquisitions, as well as paying off some existing debt.
Ananda Developments (ANA) is seeking shareholder approval to acquire the 50% of DJT Group that it does not own, which has a licence to grow >0.2% THC cannabis for research. The cost is £3.2m in shares. The process of gaining approval to grow and manufacture medicinal cannabis has been formalised.
IamFire (FIRE) says investee company WeShop user downloads and transactions are increasing.
Marula Mining (MARU) has increased its stake in the Blesberg lithium mine from 5% to 100%. The cost is $1.7m. This is subject to regulatory approval. Mobile mining equipment and the majority of processing equipment is on the site and the infrastructure is being upgraded. First deliveries of lithium ore are expected in December.
Diesel additives supplier SulNOx Group (SNOX) has appointed Steele Environmental as a US distributor for shipping markets and land-based transportation and revealed a positive evaluation with Caspian Marine Services.
Invinity Energy Systems (IES) has cut the nominal value of its shares so that it can issue more shares. A 2.2 MWh energy storage sale has been made to the company’s Taiwan resale partner. That is ten Invinity VS3 batteries.
EDX Medical (EDX) announced a collaboration for the European cancer biomarker programme with Tianjin Bioscience. This should result in the development of cost-effective cancer tests.
MiLOC Group Ltd has changed its name to Crushmetric Group Ltd. A placing raised £22,000 at 20p a share.
A company owned by NFT Investments (NFT) chairman Jonathan Bixby and non-exec Mike Edwards have has acquired 20 million shares at 0.8p a share. Finance boss Rob Smith has purchased 724,503 Chapel Down Group (CDGP) shares at 25.5p each. A company associated with chief executive David Immelman bought 50,084 DXS International (DXSP) shares at 5.454p each.
Former Aquis-quoted company Jigsaw Insurance Services is recommending a 204p a share cash offer from insurance business consolidator PIB Group Ltd. There could also be additional consideration of 14p a share depending on completion accounts. That values the bid at up to £24.1m. Harrogate-based Jigsaw was formerly known as NCI Vehicle Rescue and it left what was then known as ISDX in February 2015, so it still comes under the Takeover Panel rules.
AIM
Michelmersh Brick (MBH) expects 2022 pre-tax profit to be ahead of expectations and it is acquiring pre-built brick products manufacturer and brick fabricator Fabspeed for an initial £6.25m. The Fabspeed acquisition will be earnings enhancing. There could be up to £2m more payable depending on performance over 24 months. A share buy back programme of up to £3m is being launched.
Tatton Asset Management (TAM) continues to generate impressive net inflows to its assets undermanagement. They were £907m in the six months to September 2022, helping to offset market declines. The 50%-owned 8AM Global added a further £1bn taking the group total to £12.3bn, which has already risen to £12.9bn in November. Pre-tax profit improved from £6.77m to £7.68m and the dividend was raised by 12.5% to 4.5p a share.
finnCap (FCAP) has ended bid talks with fellow broker Panmure Gordon. It was not possible to find a mutually acceptable structure or terms for the merger.
Osirium Technologies (OSI) is raising £1.53m at 2p a share and the cash will provide additional working capital and help the cyber security business reach cash breakeven earlier than previously expected. Annualised cost savings of £1m have been identified and £650,000 of these have already been implemented. Sales director Stuart McGregor is replacing chief executive David Guyatt and he will become executive chair instead. Allenby has increased its forecast 2022 revenues to £1.8m and slightly reduced the expected loss to £3.22m.
Tissue products manufacturer Accrol (ACRL) increased interim revenues by 64% to £121.1m through a combination of higher prices and volume growth. Net debt was £30.5m at the end of October 2022 and it could fall to £24.4m by April 2023. A full year pre-tax profit of £6.7m is forecast.
Omega Diagnostics (ODX) has received the £4m deferred consideration for the sale of the CD4 business. Net cash is expected to be £6.2m by the end of March 2022. This can be used to expand the health and food intolerance operations. The US is a market where more investment is planned. Omega Diagnostics remains loss making but could move into profit in 2023-24.
Electrolyser developer Clean Power Hydrogen (CPH2) is having problems with the design and operation of its cryostat unit in the MFE 220 test unit. Scaling up the unit has been a challenge. This delayed the expected October deliveries of two initial MFE 220 units. One customer has cancelled the order and is going with a rival electrolyser. A redesign of the unit should cure the issues. On the current forecasts, the cash could reduce to £3m by the end of 2024 and then rise the following year, but further delays could mean the cash reduces more quickly than expected.
Curtis Banks Group (CBP) is in advanced discussions concerning a bid from Nucleus Financial Platforms, which is conducting due diligence. Susan McInnes has been appointed as an independent non-executive director of Curtis Banks.
DeepMatter Group (DMTR) is the latest company with plans to cancel the AIM quotation because management believes that it will be easier to raise cash as a private company. The digital chemistry data analysis business says major shareholders support the plan. DeepMatter wants to raise £1m before leaving AIM and then a larger amount after the departure.
Trafalgar Property Group (TRAF) has moved into hydroponics. The residential property developer has acquired assets and leasehold premises from May Barn Horticultural Consultancy, which is controlled by Trafalgar Property director Dr Paul Challinor, for £30,000. Trafalgar Property will concentrate on assessing plant propagation requirements and studies on tissue culture of plant material. The current work is on lettuce varieties and hydroponic tomato seedlings, as well as seedlings of Nicotiana benthamiana for future development for cosmetics and pharmaceuticals.
Real Good Food (RGD) has secured additional financing of £2.5m from Hilco Private Capital, which lasts for 12 months and is in addition to the £6.3m from the Leumi ABL. This will help to fund restructuring and cost reduction.
Zanaga Iron Ore Company (ZIOC) is acquiring a controlling shareholding in the Zanaga iron ore project from Glencore Projects in return for shares that will give Glencore a 48.26% stake. Glencore can appoint two directors and is required to retain the shares for six months. Glencore has exclusive marketing rights for the iron ore produced at the mine. A general meeting will be held on 13 December to gain shareholder approval for the deal.
MAIN MARKET
Structural steel supplier Severfield (SFR) improved interim profit and it is continuing to improve in the second half. In the six months to September 2022, revenues improved from £195.9m to £234.9m through a combination of underlying growth and higher steel prices. Underlying pre-tax profit rose from £10.3m to £12.1m, including a doubled contribution of £600,000 from the India business. Net debt was £15.8m at the end of September and the interim dividend was raised from 1.2p a share to 1.3p a share. The UK and Europe order book is worth £464m and the India order book is £143m.
Devro (DVO) has agreed a 316p a share bid from Netherlands-based Saria, which has been interested in bidding for the sausage skins supplier since the beginning of 2022.
Cardiff Property (CDFF) increased NAV from 2549p a share to 2756p a share in the year to September 2022. The current share price is 2420p. The dividend was raised from 18.5p a share to 20.5p a share. There has been a downturn in confidence in the Thames Valley property market.
Alkemy Capital Investments (ALK) says its subsidiary Tees Valley Lithium has received full planning permission for Europe’s largest lithium hydroxide refinery in Teeside. This will supply the electric vehicle battery market. Production could commence in 2025.
National World (NWOR) has decided not to bid for Reach (RCH).
Motor dealer Caffyns (CFYN) improved interim revenues from £110.8m to £119m, although underlying pre-tax profit dipped by one-third to £1.6m. New car volumes were ahead of the market and there was a 12% decrease in like-for-like used car volumes. The interim dividend is unchanged at 7.5p a share.
Ross Group (RGP) has raised £136,000 at 1.5p a share. Ross has entered into a global exclusive supply chain management agreement with the Energy Group LLC in the US to manage green hydrogen production and projects. This could be the start of a significant business for Ross.
Andrew Hore
Quoted Micro 20 June 2022
AQUIS STOCK EXCHANGE
A fall in market capitalisation to below £10m means that Coinsilium Group Ltd (COIN) will move from the Apex segment to the Access segment on 20 June.
Visum Technologies, which operates an on-ride photo camera system used by theme parks and other leisure operators, plans to join Aquis on 30 June.
Revenues recovered from £32.2m to £96m at brewer Daniel Thwaites (THW) and it also returned to profit. A loss of £12.4m was turned into a pre-tax profit of £12.7m. The pension deficit has become a pension asset worth £10.1m. A final dividend of 2.2p a share is recommended. Staffing pubs remains a problem. Prices have been increased and are set to be raised again because of rising costs. There has been a disjointed recovery this year. but sales are growing year-on-year.
Valereum (VLRM) intends to launch a global open marketplace platform for Non-Fungible tokens (NFTs). It has also appointed Z/Yen Group Ltd as strategic adviser to review the business plans for the Gibraltar Stock Exchange and help prepare a prospectus for a listing for Valereum on a major stock exchange.
All Star Minerals (ASMO) is proceeding with investments in advanced battery metals projects. Due diligence has been completed on the Blesberg lithium and tantalum project in South Africa and the Nkombwa Hill tantalum, rare earths and phosphate project in Zambia. An initial 30% stake in Blesberg can be acquired by the issue of £337,500 of shares and £237,500 in cash. An initial 25% stake in Nkombwa Hill can be purchase for a staged cash investment of $150,000. A general meeting will be held to approve a name change to Marula Mining and a proposed 100-for-one share consolidation.
Silverwood Brands (SLWD) has been readmitted to Aquis following the acquisition of Balmonds Skincare.
Gunsynd (GUN) says ASX-listed investee company Pacific Nickel Mines Ltd has secured an offtake agreement for all the production of Kolosori, as well as a $22m pre-export finance facility, with Glencore.
Triad Endeavour Sports and Entertainment has signed up with the platform run by ChallengerX (CXS). Triad is an event promoter and talent manager involved in the Ultimate Fight League.
Lekoil Ltd (LEK) has successfully challenged the jurisdiction of the New Jersey court in litigation undertaken by its former chief executive. The Otakikpo field oil production was 4,230 bopd during May.
MiLOC Group (ML.P) is restructuring its business and focusing on the distribution of designer products with partner, CRUSHMETRIC Ltd.
Wishbone Gold (WSBN) says initial tests confirm copper is present in the drilling at the Halo copper gold project in northern Queensland. Drilling is underway at the Red Setter project in Western Australia.
The Care Quality Commission has granted registration to the diagnostic and screening services offered by Goodbody Health Inc (GDBY).
ProBiotix Health (PBX) has appointed Steen Andersen as chief executive. He has more than three decades of experience in the probiotics sector.
S-Ventures (SVEN) has capped future consideration for plant-based products supplier Pulsin at £400,000 and effectively lowered the total cost from £6.7m to £5.5m.
Chris Akers took a 4.96% stake in Recent Aquis admission Psych Capital (PSY). He has also increased his stake in Quetzal Capital (QTZ) from 20.1% to 21%.
Ananda Developments (ANA) has raised £38,000 from the exercise of warrants at 0.45p each.
AIM
IDOX (IDOX) increased revenues by 7% to £33.2m in the six months to April 2022 and recurring revenues account for three-fifths of the total. Public sector software sales were 10% ahead, while engineering information management revenues declined although they should recover in the second half. Net debt was reduced by 54% to £3.8m, which leaves plenty of funds to make acquisitions.
Tatton Asset Management (TAM) is growing assets under management at more than £100m a month and they reached £11.3bn at the end of March 2022. In the year to March 2022, group revenues improved from £23.4m to £29.4m, while pre-tax profit grew from £11.2m to £14.5m. The dividend is 13% higher at 12.5p a share. Higher mortgage activity meant that there was growth in the Paradigm division and, although new mortgage activity is lower, management believes that revenues can be maintained this year. Weaker financial markets could affect this year’s group performance, but the inflow of funds should offset that.
Xeros Technology Group (XSG) was the best AIM performer last week with a 46.2% gain to 47.5p. Germany-based washing machine pumps and drives manufacturer Hanning has signed a ten-year global licence to manufacture and sell the XFilter washing machine filter technology developed by Xeros. XFilter enables microfibres and microplastics released during washing to be captured and safely disposed of. Hanning is estimated to supply components for 8.5 million washing machines each year – around one-third of those made in Europe. The royalty is undisclosed, but it could be around £1 per filter.
Subsea cable protection services provider Tekmar Group (TGP) lost more than three-quarters of its value last week after it announced that it was seeking a strategic partner or bidder. Interim revenues fell from £13.9m to £13m and Tekmar remains loss making. The order book has improved from £9.7m to £20.1m over the six months to March 2022.
Shares in US-based video game publisher Devolver Digital Inc (LON: DEVO) more than halved after it lowered its revenues and profit guidance for this year. Revenues are expected to between $130m and $140m. Zeus has cut its earnings forecast from 7.2 cents a share to 6 cents a share.
The M&C Saatchi (SAA) board has withdrawn its recommendation of the bid by the marketing services company Next Fifteen Communications (NFC), the value of which has fallen due to the slump in the share price of the bidder.
Revolution Bars Group (RBG) trading is strong and a trading statement sparked a forecast upgrade by finnCap for the vodka bars operator. Refurbished bars have done particularly well, and two new bars should open by the end of June. Forecast pre-tax profit for 2021-22 has been raised from £500,000 to £2.7m.
Oil and gas explorer Rockhopper Exploration (RKH) announced a £5.75m placing and subscription at 7p a unit (one share and of a warrant exercisable at 9p a share). The Sea Lion project in the Falkland Islands is the main focus of Rockhopper.
Wynnstay Properties (WSP) is planning to obtain shareholder approval for buying back shares. NAV increased by 19% to 1090p a share in 2021-22. The total dividend was raised from 21p a share to 22.5p a share.
Actual Experience (ACT) says that due to a change in requirements a channel partner has terminated a contract that generated £200,000 out of group revenues of £1.74m in 2020-21.
Competitions organiser Best of the Best (BOTB) reported better than forecast figures and a 66.7p a share return of capital via a tender offer. Net cash was £10.8m at the end of April 2022 and there is a 6p a share final dividend on top of the tender offer. The total cash cost of these payments is £6.84m.
In the year to April 2022, the pre-tax profit fell from £14.1m, for what was an unusually strong year due to Covid restrictions, to £5.1m.
Hong Kong-based CCTV technology company UniVision Engineering Ltd (UVEL) has received notice of the termination of a contract with MTR Corporation for the replacement of CCTV systems on Hong Kong railway lines.
MAIN MARKET
Castings (CGS) generated a 29.5% increase in full year revenues to £148.6m. Profit and margins are still improving and there is more to go for as business levels get back to the pre-Covid position. Zeus forecasts a further improvement in underlying pre-tax profit from £12.1m to £15.5m in 2022-23.
Structural steel supplier Severfield (SFR) continues to win new business and higher steel prices are being passed onto clients. In the year to March 2022, revenues increased from £363.3m to £403.6m, while pre-tax profit improved £24.3m to £27.1m. The final dividend is increased from 1.8p a share to 1.9p a share, taking the total to the year to 3.1p a share. Severfield has a record order book worth £486m.
Palace Capital (PCA) has increased its NAV to 390p a share and the loan-to-value declined from 42% to 28% following property sales at a premium to book value. The total dividend is 13.3p a share.
Graft Polymer (UK) (GPL) says that MGC Pharmaceuticals (MXC) is using its IP for the nano delivery system in the pre-clinical research study for the use of cannabinoids to treat Glioblastoma multiforme cells (a form of brain cancer).
Contango Holdings (CGO) has agreed to acquire 10,000 tonnes of washed coking coal from Lubu each month. The current market price is $120/tonne. Up to $10m of earnings could be generated from this deal each year.
Funeral directors Dignity (DTY) says FCA has confirmed it is intending to authorise Dignity Funerals LTD as a regulated entity under the new regulations for pre-paid funeral plans.
Andrew Hore
Quoted Micro 25 April 2022
AQUIS STOCK EXCHANGE
Gunsynd (GUN) had net assets of £5.99m at the end of January 2022. That includes £1.08m in cash. Investee company Low6 is still seeking a listing in Toronto via 1319735 BC Ltd. Mining investee company Charger Metals plans to start its maiden drilling programme at the Coates project in Western Australia. First Tin joined the Main Market after the period end.
Tectonic Gold (TTAU) has appointed Ian Bruce as exploration manager, and he will restart the drilling at Specimen Hill. A permit has been secured in the same area for Taree Fields, which was historically a high-grade copper mine. Deep Blue Minerals, where Tectonic owns 10%, raised $236,000 from diamond sales.
Lombard Capital (LCAP) has agreed in principle the sale of LCP Financial to SBS Group for £4.2m in shares and the repayment of a £370,000 intercompany loan. Lombard Capital will acquire Waste and Recycling Services before the sale is completed. Management will be seeking shareholder approval to leave Aquis.
ChallengerX (CXS) has signed a five-year agreement with The American Arena League for the use of the SaaS-based platform CXSports. This will help to promote the league and generate revenues.
Blockchain and open finance investor Coinsilium (COIN) has agreed to purchase $200,000 of YELLOW tokens for the Yellow Network, which is a cross chain overlay, financial information exchange and distributed infrastructure network.
Adam Pollock, who was previously head of corporate and institutional at WH Ireland, has become a director of Oberon Capital, the broking business of Oberon Investments Group (OBE).
Vulcan Industries (VULC) has raised £48,000 at 1.37p each.
All Star Minerals (ASMO) is changing its name to Marula Mining.
AIM
TV programmes producer Zinc Media (ZIN) lost on £2.61m on revenues of £17.5m in 2021. There is already £13m of booked revenues for 2022 and there is potential further business worth £35m that could be delivered this year. A greater proportion of the work being won is for series, rather than one-off programmes. Zinc Communicate, which produces non-broadcast content and podcasts, is becoming increasingly important. The timing of the orders is uncertain and not all the work will materialise, although £8m is at an advanced stage. This suggests that 2022 revenues should be much higher, and Zinc Media should become profitable and cash generative. Last year, the cash outflow from operations was £245,000. Net cash was £2.18m at the end of 2021.
Churchill China (CHH) is beating its rivals thanks to its capital expenditure and investment in marketing, and it has a better order book than normal for this time of year. In 2021, pre-tax profit bounced back from £800,000 to £6m as revenues recovered from £36.4m to £60.8m. The total dividend is £24p a share, while there is £19m in the bank. Churchill China has taken on more than 200 additional staff in the past year and they still require training. Last autumn, selling prices were raised by 12% and a 5% increase is planned for May. That will help to offset the cost rises. Pre-tax profit is expected to be between £8m and £8.8m this year.
Tungsten West (TUN) is reviewing development options for the Hemerden mine because of rising costs. This will lead to a two-month delay. This could lead to a focus on sodium tungstate production because it is higher value than ammonium paratungstate.
Solid State (SOLI) continues to best expectations. Revenues for the year to March 2022 will be around 6% ahead of previous expectations at £85m, while there is a 11% upgrade in pre-tax profit to £7.4m.
Seeing Machines (LSE: SEE) has secured a collaboration with Magna to develop and demonstration model driver monitoring system (DMS) combining, camera, electronics and interior mirror technology. This should help Seeing Machines win more market share.
Plant-based polymers developer Itaconix (ITX) says volumes continue to increase, particularly in the dishwashing detergent ingredients market.
Coral Products (CRU) is trading ahead of expectations in the year to April 2022 and there is a second interim dividend of 0.4p a share. There could also be a final dividend to add to this year’s total of 0.9p a share.
MAIN MARKET
Nuclear-related business has helped structural steel supplier Severfield (SFR) to enjoy record orders. Logistics, infrastructure and data centres are other areas of high demand. Longer-term, battery manufacturing plants could be another booming area. The current order book is worth £479m. The 2021-22 figures will be in line with expectations with pre-tax profit forecast to improve from £24.3m to £28.1m. This year’s revenues should be better than previously expected, but profit expectations have been maintained because of higher steel costs. The higher steel prices mean that higher working capital is required.
Full year profit of kitchenware retailer ProCook Group (PROC) will be slightly lower than expected at £9.5m. ProCook has grown revenues in a market that is slightly down
J Smart Contractors (SMJ) reported a decline in interim revenues from £5.75m to £5.16m, while pre-tax profit jumped from £890,000 to £6.35m, although that was due to a gain on the sale of investment properties of £6.06m. It is unlikely that full year profit will be higher this year. Net assets are £117.2m, including £76.2m of investment properties and net cash of £27.6m. The interim dividend is 0.96p a share and the ex-dividend date is 5 May.
Andrew Hore
Company news, including: Castings – Steady Demand, Heady Dividends
Castings CGS has declared a supplementary dividend of 30p per share in addition to increases in the interim and final dividends to make a total of 13.71p for the year to 30th March. Customer demand is said to be steady.
Severfield SFR aims to double underlying profit before tax over the next 4 years and with the order book at its highest for 6 years, it seems set fair to succeed. Orders as at 1st June had risen to £270m. compared to £ 185m a year ago. 2016 proved to be a strong year with excellent revenue and profit growth. Profit after tax for the year to 31st March rose from a measly £0.1m. to £8.6m. after a 19% revenue increase and a rise in basic earnings per share from 2.3p to 3.67p. The company is to pay a final dividend of 1p. per share.
Oxford Instruments OXIG The CEO claims to be excited by the opportunities for the company, with last years loss of £9.6m turned into a profit before tax of £13.1m for the year to 31st March. Operating cash flow increased by 27% despite a decline in revenue of 4.9%. The end of year order book was 12.1p up on the previous year and the dividend remains unchanged at 13p. per share.
The Nightmare Chancellor now announces that taxes will have to rise if the UK Brexits. Has it taken up to 8 days before voting day for him to realise that or is it just desperation on his part. If after 3 years he has only just woken up to tax consequences of Brexit, then he is not fit for purpose. And still neither he nor Cameron can find a good word to say about the benefits of Remaining.
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