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Quoted Micro 5 September 2022
AQUIS STOCK EXCHANGE
Cancer treatments developer Incanthera (INC) says that commercial discussions continue for skin cancer treatment Sol and there is potential for a Sol-based product range. There is still £295,000 of cash in the balance sheet at the end of March 2022. The Actino-Pro brand has been trademarked. There was a cash outflow from operations of £660,000 in the previous 12 months. Two directors have provided a loan facility of £190,000, of which £50,000 has been drawn. The directors have waived their remuneration and a payment to UOB has been deferred. Management believes that Incanthera will have enough finance until the fourth quarter of 2023. Potential partners could take advantage of the lack of cash when doing a deal.
S-Ventures (SVEN) has acquired Lizza, a wellness and free-from food brand, from Peter Cremer Holding. The Hamburg-based agricultural business is subscribing £2m for shares in S-Ventures at 70p each. The share price has never traded at that level. Lizza produces pasta and breads and provides S-Ventures with a base in the German market. Revenues were €4.5m in 2021. The initial cost of the deal is €1, but there is an earn-out based on a share of profit over ten years up to a maximum total of €2.366m.
Healthcare IT developer DXS International (DXSP) is reviewing its growth plans for the next 24 months. The new strategy will be designed accelerate growth and is likely to require additional funds. They will probably be raised through a share issue and that appears to have worried investors.
KR1 (KR1) has invested $300,000 in RedStone Finance, as part of a $7m fundraising. KR1 participated in the previous financing round. RedStone is developing RedStone Oracles, a provider of data feeds for crypto assets, and smart contract platform provider Warp Contracts.
Rent guarantee service provider RentGuarantor Holdings (RGG) published interim results showing a jump in revenues from £91,000 to £170,000. Higher admin expenses meant that the loss increased from £258,000 to £353,000. Revenues continued to improve in July and August.
Tectonic Gold (TTAU) says 40%-owned Whale Head Minerals has received a mining permit for its near-production minerals sands operation, which has an estimated NPV of £150m. Tectonic Gold has agreed to transfer a 30% stake to Whale Head Minerals’ BEE partners, which have mining expertise, and it will retain a non-diluting interest of 10%.
Invinity Energy Systems (IES) says contract manufacturer Baojia has shipped 1.1MWh of Invinity batteries from its factory in China designed for the project with Elemental Energy in Canada. Final assembly and testing will be done by Invinity Energy Systems at its factory before delivery.
TECC Capital (TEC) has invested a further £200,000 in convertible loan notes in EDX Medical. This takes the total investment in convertibles to £500,000, which is guaranteed by EDX Medical founder Professor Sir Chris Evans. Discussions continue about the acquisition of EDX Medical.
Vulcan Industries (VULC) has sold tacks and nails manufacturer IVI Metallics for £1. The business had net liabilities of £458,000 and it has struggled to rebuild its order book. Vulcan Industries still provides a cross guarantee for the CBIL liability of £739,000.
SuperSeed Capital Ltd (WWW) says that SuperSeed Fund II has led a $3.6m investment in brand advocacy platform Duel. The software-as-a-service platform helps retail brands grow via positive feedback from customers. ASOS, Unilever and Mint Velvet are among the clients.
Evrima (EVA) has an 8.93% stake in Kalahari Key, which has provided an update on the Molopo Farms Complex project. A diamond drilling contract has been signed with a Botswana-based company.
Yooma Wellness Inc (YOOM) increased interim revenues from $2.78m to $6.49m and the loss has been reduced from $5.57m to $3.83m. CBD product sales were strong in Europe and Japan. The company has been reducing its expenses.
Clarify Pharma (PSYC) had cash of £2.1m at the end of May 2022. It is seeking investments in the medical use of psychedelics.
Oscillate (MUSH) had £1.91m in the bank at the end of May 2022, although £600,000 has been invested in Aquis-quoted Psych Capital (PSY) and fully listed Dev Clever (LON: DEV).
AIM
Futura Medical (FUM) says that the clinical study for the MED3000 topical gel erectile dysfunction treatment has met its primary and secondary endpoints. The study showed an improvement in erectile function and a highly statistic improvement in the onset of action at 10 minutes. There were limited side effects with 4.3% of patient suffering headaches and a further 4.3% nausea, which is much better than rival treatment tadalafil. The next move is submitting MED3000 for FDA review as a De Novo medical device for the over-the-counter treatment of erectile dysfunction. This could lead to marketing authorisation by the first quarter of 2023. MED3000 has received the UKCA mark.
Neurocrine Biosciences Inc is making a recommended bid of 27.5p a share in cash for hormonal disease treatments developer Diurnal (DNL), which values the company at £48.3m. The April 2021 placing and open offer was at 70p a share and the share price has slumped since then. Revenues have not built up as fast as hoped and another cash raising is on the horizon if Diurnal stays independent.
Pharma software provider Instem (INS) has gained its largest ever contract. The deal is worth at least $12m over five years. The client is a contract research organisation and is for the company’s cloud-based Aspire clinical trial acceleration software, which will be launched with the customer in one year. There is $3m for implementation and the rest is paid in instalments of $2.25m a year over four years. The annual recurring revenues are $1m more than for the Instem system that is being replaced.
Egg-free cakes retailer Cake Box (CBOX) says trading is becoming more difficult and only part of the cost increases it is suffering are being passed on to franchisees. Sales are also under pressure with a like-for-like decline of 2.8% so far in this financial year. This means that full year profit will be much lower than the £7.2m expected. There is £6.7m in cash, although the £2m dividend will be paid in September. Chief executive Sukh Chamdal acquired 225,000 shares at 121.85p each.
Telephony services provider LoopUp Group (LOOP) has taken on a book of conference service contracts from a US competitor for no initial payment. There is a revenue share agreement for three years to October 2025. These contracts could generate cash of £5m a year, although it may reduce due to customer churn. This is much-needed cash flow for the business, which is still heavily loss-making. The new bank facility is £17m and that more than covers the expected net debt at the end of 2023.
Oil and gas producer PetroNeft Resources (PTR) has an oil storage and transportation contract with Nord Imperial for production from licence 61 in Tomsk Oblast, Russia at a cost that is far above standard market rates. PetroNeft has tried to change the contract and started paying reduced amounts, but Nord Imperial has suspended acceptance of oil. PetroNeft is shutting down its wells, which will hit income. Licence 67 is not affected and is producing 270 barrels of oil per day.
Independent directors of market research firm System1 Group (SYS1) are conducting a strategic review and the proposed tender offer has been postponed. This review will assess whether the company can grow faster if partners or an external investor are brought in.
MAIN MARKET
Zamaz (ZAMZ) joined the standard list last Friday and raised £3.69m. Cornerstone investor Atlas paid 10.45p a share, which is a 5% discount to the nominal subscription price. Most of the cash will go on expenses and repaying existing bonds. Zamaz believes that its technology platform can help to efficiently build direct to consumer brands via e-commerce. Amazon is currently the main marketplace used by the company. There is already a portfolio of brands in the group, but most are at an early stage of their development. There are plans to acquire more brands. Revenues are relatively modest and Zamaz is losing money. The share price fell to 9.48p (8p/10.95p) on the first day. There were 90,000 shares traded in one deal at 10.95p. The shares are tightly held and there is potential dilution from the convertibles worth up to £15m that could be issued to Atlas Capital Markets and the associated warrants.
First Tin (1SN) has announced positive intercepts at the latest two drill holes at the Gottesberg tin project in Germany. These and other results validate the belief that a higher grade core exists within the deposit.
Iconic Labs (ICON) has settled disputes and has finalised proposals for a company voluntary arrangement. If this goes ahead then the administration will end and trading in the shares may recommence once up to date results have been published. The shares have been suspended for around 15 months.
Andrew Hore
Quoted Micro 25 July 2022
AQUIS STOCK EXCHANGE
In the six months to March 2022, S-Ventures (SVEN) reported an increase in revenues from £1.5m to £4.1m, although it remains loss making. The full benefits of acquisitions and the consolidation of warehousing has yet to show through. Even so, VSA has cut its 2021-22 revenues forecast from £11m to £9.4m S-Ventures will continue to lose money.
Arbuthnot Banking Group (ARBB) improved interim underlying pre-tax profit from £6.5m to £10.7m. NAV is 1300p a share. The interim dividend is 17p a share. Customer loans increased by 5% to £2.1bn. Assets under management dipped to £1.3bn after the decline in stockmarkets. A West End long leasehold property has been sold at a value of £60m and a yield of 3.75%.
Shepherd Neame (SHEP) has acquired Bournemouth seaside bar and restaurant Urban Reef. This takes the total number of pubs owned by the Faversham-based brewer to 300.
Psych Capital (PSY) says that investee company Awakn Life Sciences has received C$2.5m of UK government funding for the phase III trial for a ketamine-assisted therapy for alcohol use disorder. Awakn will finance the other C$1.25m cost of the trial.
Vulcan Industries (VULC) is selling Orca Doors for £1. That gets rid of net liabilities of £751,000 and continued cash outflows. The fire door supplier has been hit by lockdowns and requires additional investment.
Ananda Developments (ANA) subsidiary DJT Plants has successfully self-crossed the first generation of cannabis plants. This will continue for six generations. The performance of various cannabis cultivars is being assessed.
AQRU (AQRU) subsidiary Accru Finance is partnering with Quickbit, a Sweden-based fintech, which will offer the Accru yield generating products to its customers.
Black Sea Property (BSP) has completed the purchase of Star Mil EOOD for a total consideration of Euro5.15m. The company owns a Black Sea hotel complex. A loan of Euro4.2m helped to finance the purchase.
Rogue Baron (SHNJ) has made its first sales of Shinju Japanese whisky to Austria and Switzerland.
Lombard Odier has reduced its stake in Chapel Down Group (CDGP) from 9.97% to 4.99%. Mark Horrocks has increased his stake in Quetzal Capital (QTZ) from 5.3% to 6%. A company related to Marula Mining (MARU) chief executive Jason Brewer has acquired 100,000 shares at 2.75p each.
Oscillate (MUSH) has acquired 2.5 million warrants in fully listed Dev Clever (DEV) for £250,000. The warrants are exercisable at 1p each up until 21 January 2024. Dev Clever is currently undertaking a reverse takeover.
AIM
Business restructuring business Begbies Traynor (BEG) increased underlying pre-tax profit from £11.5m to £17.8m in the year to April 2022. This was a combination of acquisitions and organic growth. The dividend has been increased from 3p a share to 3.5p a share. Net cash improved from £3m to £4.7m. Insolvencies are increasing, although the higher margin administrations are still relatively low. This could change over the next year or so, making the outlook positive.
Credit provider Morses Club (MCL) says an increasing level of customer redress claims means that it is considering a scheme of arrangement. This could provide certainty about the potential total level of claims over a set period. Management is talking with the FCA. The scheme would have to be approved by the majority of claimants. There will be an additional provision of £45m in the 2021-22 accounts and underlying pre-tax profit could be below £3.5m. Tighter controls mean that sales are declining, and Morses Club won’t make a profit in 2022-23. Fewer competitors could help Morses Club recover in the following year.
Disinfection products supplier Tristel (TSTL) announced a special dividend of 3p a share on top of a final dividend of 3.93p a share. Full year revenues are 4% ahead at £28.4m and adjusted pre-tax profit is 12% higher at £4.5m. The second half was stronger as more patient procedures have been undertaken. FDA approval for the Duo ULT could be achieved next year.
Footwear supplier Unbound Group (UBG) announced a fundraising generating £3.3m at a heavily discounted 15p a share. An open offer, which closes on 8 August, could raise up to £1m more. The footwear supplier is launching an online platform to sell third party branded products to a database of 4.6 million individuals. The cash will help to finance the expansion.
Stanley Gibbons (SGI) intends to cancel its AIM quotation. Graham Shircore is stepping down as chief executive in September and he will be replaced by Tom Pickford. The largest shareholder Phoenix SG believes it is better to cancel the quotation considering the limited free float and additional costs. The 58% shareholder also says that it would reconsider its financial support if shareholders do not agree to the cancelation. Stanley Gibbons remains loss making.
In-content advertising company Mirriad Advertising (MIRI) expects flat revenues in 2022 because of weak market conditions in China. The Chinese operations will be closed next year and that will save annualised costs of £1m. That is on top of the £2.5m of annualised savings expected for the business as a whole. Interim revenues have halved, although US revenues increased. There is £17.7m in the bank and cash should be higher than previously expected at the end of 2022. Cash outflows are still significant, though.
Window fittings supplier Titon (TON) says that supply problems with raw materials and components exacerbated by cost inflation have led to a reduction in margins. There have also been problems with IT, so this year’s figures will be lower than expectations. South Korea sales are disappointing but there should be a small profit contribution.
Restructuring services provider FRP Advisory (FRP) increased revenues from £79m to £95.2m in the year to April 2022, with 11% organic growth. Pre-tax profit improved from £21.2m to £23.1m. There are signs that administrations are starting to increase and that will boost demand for services.
Cambridge Cognition (COG) directors are buying shares following yesterday’s trading update. Chief executive Matthew Stork and finance chief Stephen Symonds each bought 22.950 shares at 113p each. The latter did not previously own shares. The digital brain health products developer increased interim revenues by 31% to £5.9m. The order book is worth £18.6m. There was a small profit and £8.6m in the bank at the end of June 2022.
The merger between Tern (TERN) and Pires Investments (PIRI) is not going ahead because not enough of the latter’s shareholders voted for it. Tern wants to generate cash from exiting one or more of its investments as soon as it is feasible. There will not be any new investments until there is a realisation of an investment, although there are likely to be commitments to existing investments that may mean a fundraising will be required.
An independent decision means that Newcrest Mining can pay $60m to Greatland Gold (GGP) to take up an option to acquire a further 5% stake in the Havieron project. Given the progress that has been made on the project over the past year this is an attractive price, and it is likely to take up the option. The cash will pay off the $50m loan facility from Newcrest and leave money for further investment. Greatland Gold will still own 25% of Havieron.
MAIN MARKET
Palace Capital (PCA) is changing its strategy. It was originally going to reinvest the cash from the sale of its industrial property assets into new regional office investments. Shareholder feedback means that the potential £46.5m raised from the disposal of the industrial portfolio and other non-core assets, after repayment of related debt, will be distributed in dividends or paid back via a tender offer. Three non-exec directors have resigned.
Kin + Carta (KCT) says revenues grew 48% in the year to July 2022. Peel Hunt has upped its 2021-22 pre-tax profit forecast from £16.6m to £16.9m. Net debt is estimated at £2.5m. Kelly Manthey will be taking over as chief executive.
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 9 May 2022
AQUIS STOCK EXCHANGE
In 2021, Newbury Racecourse (NYR) is paying a special dividend of 89.6p a share. The £3m payment comes after the receipt of the final £10.7m from the sale of housing development land. Newbury Racecourse increased turnover by 75% to £14.8m as racing returned to the course. There is still potential for further recovery this year. Attendances increased from 12,000 to 105,000. The hotel reopened in January 2022. There was a swing from £2.17m loss to an underlying pre-tax profit of £333,000.
Quantum Exponential (QBIT) is investing £406,000 in Aegiq Ltd, a photonics company using quantum technologies in the cybersecurity market. That gives it a 4.06% stake. Helium Special Situations has reduced its stake from 4.57% to 1.52%.
Goodbody Health Inc (GDBY) reported better than expected revenues for 2021. The CBD products and testing company made an underlying loss of £900,000 on revenues of £17.1m. Arden forecasts a £5.1m profit this year.
VSA Capital (VSA) has received a settlement of outstanding fees of £153,000 from client Anglo African Agriculture in the form of 3.82 million shares. This gives VSA a 15.3% stake plus warrants and convertible loan notes.
Gunsynd (GUN) has terminated the disposal of Oyster Oil and Gas to Sajawin.
Clarify Pharma (PSYC) had net cash of £1.3m at the end of April 2022. Investment opportunities in the psychedelics market are being assessed.
Apollon Formularies (APOL) has acquired intellectual property and patents from Aion Therapeutic for £96,000 and 4.35 million shares. It will also pay a royalty fee of 4% on net revenues from products based on these patents. The patents cover potential cancer treatments.
ChallengerX (CXS) has appointed Olivia Edwards as chief executive and Nicholas Lyth as finance director.
Phase 1 assay results from the Monte Muambe project held by Altona Rare Earths (ANR) show significant levels of rare earths.
Coinsilium (COIN) has been appointed as adviser to Silta Finance and entered into an agreement to purchase $75,000 of future SILTA tokens. Silta is building a technology to connect decentralised finance to infrastructure project developers.
Capital for Colleagues (CFCP) has sold its remaining stake in builder’s merchant Merkko Group for £378,000.
Rogue Baron (SHNJ) has received the first UK order for Shinju and Shinju 8-year old whisky.
S-Ventures (SVEN) chairman David Mitchell bought 57,959 shares at 32p each. Chris Akers has increased its stake in Quetzal Capital (QTZ) from 19.1% to 20.1%. John Mahtani reduced his stake from 5.71% to 3.83%.
AIM
Online retailer of building materials CMO Group (CMO) continues to grow on the back of a buoyant market as well as gaining market share. The online share of the sector remains relatively low. The second half growth was not as fast as in the first half. In 2021, revenues grew 46% to £76.3m. There is organic growth supplemented by acquisitions. CMO moved from loss to an underlying pre-tax profit of £1.4m. Net cash was £6m. Following the acquisition of JTM Plumbing Plumbingsuperstore.co.uk is being launched later this year. First quarter trading has continued to be strong with like-for-like growth of 3%.
Neonatal intensive care medical devices supplier Inspiration Healthcare (IHC) increased full year revenues from £37m to £41.1m. Acquisition contributions offset the one-off Covid ventilator revenues in the previous year. Pre-tax profit improved from £3.13m to £3.96m, although earnings fell 12% to 6.1p a share because of the additional shares issued for acquisitions. The company’s order book is strong.
In 2021, targeted digital advertising services provider Dianomi (DNM) revenues grew from £28.4m to £35.8m, even though Asia Pacific revenues fell from £1.72m to £1.18m due to the ASX website stopping having advertising content. Underlying pre-tax profit moved from £2m to £2.9m – share based payment charges and float costs led to a loss being reported – and it is expected to increase to £3.6m this year. The average spend of the top 100 advertisers increased 27% to £280,000 each. Net cash was £10.3m at the end of 2021.
In 2021, Intelligent Ultrasound (IUG) reported revenues 47% higher at £7.6m, mainly from ultrasound simulation products, while the cash outflow from operations was £2.3m. AI revenues remain modest, and it will take time for them to build up. Cenkos upgraded its 2022 revenues forecast from £9m to £10m, but the cash outflow will be similar.
Plastics and packaging supplier Coral Products (CRU) is using some of its cash pile to acquire Film & Foil Solutions, a supplier of flexible packaging film used for food, books, carpets and for cable tapes. The initial payment is £1.35m in cash, plus £750,000 in shares at 15.5p each. There is just over £900,000 that could be payable based on the settlement of a contract dispute and an insurance payment. The acquired business made an underlying profit of £541,000 in 2021.
Energy efficiency as a service provider eEnergy Group (EAAS) has been hit by contract delays. That means that 2021-22 EBITDA could be £3m and not £4.4m as previously expected. A new finance director is being appointed.
Green hydrogen production developer ATOME Energy (ATOM), which was spun out of President Energy (PPC) at the end of 2021, has secured a major 60MW power purchase agreement with ANDE, the national power supplier in Paraguay. Hydrogen production could commence in Paraguay in the first quarter of 2023.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LUCE) will report revenues around £15m lower than expected due to overstocking. This will knock £10m off operating profit. Price rises are offsetting the effect of inflation.
Castings (CGS) 2021-22 results will be slightly ahead of expectations. Demand for commercial vehicles remains strong, but there is still uncertainty about the ability produce heavy trucks.
Kendrick Resources (KEN) was formerly AIM-quoted BMR Group, which left AIM in August 2018 after problems with the progress of the Kabwe project in Zambia. Kendrick still has a 11% royalty interest in Kabwe. Kendrick Resources has acquired Northern X Finland and Northern X Scandinavian. In Finland, there is an exploration licence at the Koitelainen project and two licences at the Karhujupukka project. There are two projects in Sweden: the Airijoki project and the Central Sweden project. There is also an option over three projects in Norway.
Gresham Technologies (GHT) has secured a contract with an existing bank customer worth up to £6.3m over a period of five years. The company’s Clareti software will be used across the whole UK business of the bank.
Andrew Hore
Quoted Micro 18 April 2022
AQUIS STOCK EXCHANGE
Brewer Adnams (ADB) increased its revenues from £50.7m to £57.4m in 2021 and the loss was reduced from £4.3m to £1.39m. There is no final dividend. Net bank debt was £11m. The pension liability more than halved from £11.2m to £5m. Beer volumes were maintained.
S-Ventures (SVEN) says headwinds in the economy have held back sales of its healthy snacks. Even so, like-for-like sales are currently 10% ahead of last year. Cost savings of £300,000 a year have been found at the Pulsin plant-based products business.
Watchstone Group (WTG) subsidiary WTGIL Ltd has lost its VAT appeal. It is considering whether to take the appeal to the Upper tax Tribunal.
Cannabis-related products supplier Voyager Life (VOY) has opened three stores and relaunched its website in the year to March 2022. The Ascend Skincare brand was launched. There was £14.3m in the bank at the end of March 2022. Monthly overheads were just under £50,000. In the 16 months to March 2022, revenue reached £178,000. Revenues are steadily growing. Voyager is still waiting for ingestible products to receive authorisation from the authorities.
KR1 (KR1) has invested $700,000 in Zeitgeist in return for one million ZTG tokens. Zeitgeist is an application specific blockchain for prediction markets and futarchy.
Eastinco Mining and Exploration (EM.P) says that Aterian Resources has been awarded a ten year mining licence for the Agdz copper and silver project in Morocco. Eastinco has agreed to acquire Aterian from AIM-quoted Altus Strategies (ALS). Once the Aterian acquisition is completed Eastinco plans to move to the Main Market.
Goodbody Health (GDBY) says subsidiary PhytoVista Laboratories has been granted a licence to handle Schedule 1 controlled drugs.
Chris Akers has increased his stake in TECC Capital (TEC) from 10.6% to 11.1%. Robert Johnson reduced his stake to below 3%. Chief executive Kiran Morzaria has bought 54,422 shares in Cadence Minerals (KDNC) at 18.37p a share.
Vulcan Industries (VULC) has extended two loans with £1.225m payable on 16 April 2023 and £629,000 on 4 July 2023.
EPE Special Opportunities (ESO) had net assets of 368.49p a share at the end of March 2022.
AIM
Recycling Technologies has pulled its AIM flotation after its chief executive stepped down due to personal reasons. It had apparently raised the money it was seeking but the late change meant that the company has decided to have a smaller private fundraising before having another attempt at floating on AIM.
Loadbanks maker and hirer Northbridge Industrial Services (NBI) is able to concentrate on its core business following the disposal of Tasman. In 2021, revenues from continuing operations were one-fifth higher with a greater proportion of hire business. Pre-tax profit trebled to £3.3m, before the restructuring and convertible loan note redemption costs of £7.6m, which were predominantly asset write-downs. There was a 1p a share dividend. The company is changing its name to Crestchic.
Online electricals retailer Marks Electrical (MRK) reported full year revenues that were 44% ahead at £80.5m and EBITDA margins are 9%. The fourth quarter revenues to March 2022 were 19% ahead at £20.7m. The comparatives are particularly strong because they were during a period of lockdowns when online sales made up a higher proportion of appliance sales. Pre-tax profit is still expected to decline from £6.8m to £6.1m in 2021-22 due to additional overhead costs.
Cambridge Cognition (COG) is building up its clinical trial business. Full year revenues increased by 50% to £10.1m and the digital health company moved into profit. There was £6.8m in the bank at the end of 2021. At least £7.5m of the year-end order book of £17m should be recognised in 2022. More contracts have been secured since the end of 2021.
Asset management services provider MJ Hudson (MJH) grew interim revenues by 48% to £23.4m with particularly strong growth in ESG-related services. Underlying pre-tax profit quadrupled to £1.6m. Net debt excluding leases was £13m at the end of December 2021. New business activity remains strong and there is no direct effect from the weak stockmarkets on revenues. Guernsey-based Saffery Champness Fund Services was acquired during the period.
Telematics firm Microlise (SAAS) reported revenues of £88.2m in the 18 months to December 2021. Annual revenues grew by 17%. Existing customers generated £35.6m in 2021 and there is hardly any customer churn. Annual recurring revenues are £38.9m.
AEX Gold (AEXG) has announced exploration results from the iron oxide, copper, gold project at Sava in southern Greenland. These showed that there is mineralisation. There are three high priority targets.
The lock-up period for shares in Poolbeg Pharma (POLB) distributed by Open Orphan (ORPH) ends on 20 April and new investors are hoping to buy up to £1.6m of shares at 5.9p each. The share price subsequently recovered to 6.7p, having been sliding in recent months ahead of the end of the lock-up period when there were concerns there could be a significant number of shares coming onto the market.
Ince (INCE) is going ahead with the acquisition of broker Arden Partners (ARDN) even though it is losing its nominated adviser status. The merger should be completed on 29 April.
MAIN MARKET
Financials Acquisition Corp (FINS) is a shell looking for a financial services acquisition, particularly in the insurance area. The focus is technology that is used to make the insurance sector more efficient. There was £150m raised at £10 a share. The share price ended the week at 997.5p.
It took a year to secure the transaction, but DG Innovate (DGI) has completed its reversal into Path Investments. The purchase of the electric drive and sodium-ion battery technology developer cost an initial £32.4m in shares at a deemed price of 0.6p a share, which was well above the market price. There was also £2.55m raised at 0.5p a share. The shares opened at 0.45p and ended the week at 0.305p.
Materials developer HeiQ (HEIQ) estimates that revenues were $57.9m thanks to a good fourth quarter. This is despite deferring revenues and $1m in operating profit from technology milestones for the agreement with the Lycra Company for its AeoniQ material into 2022. Operating profit is expected to be $3.4m, compared with the $4m forecast. Revenues are expected to grow by one-fifth this year.
Natural ingredients supplier Treatt (TET) grew interim revenues by 9% to £66.3m. The operating profit will be second half weighted.
Andrew Hore
Quoted Micro 28 March 2022
AQUIS STOCK EXCHANGE
Arbuthnot Banking (ARBB) returned to profit in 2021 and it is paying a final dividend of 22p a share, having already paid 37p a share for the financial year. Net assets are 1315p a share. Slater Investments has a 7.05% stake.
S-Ventures (SVEN) is acquiring Market Rocket Ltd, which is a digital agency that helps brand owners to sell their products, for an initial £2.25m. There could be further shares issued if performance targets are met. In the year to March 2021, revenues were £500,000 and this year they will be much higher. This is a profitable business.
British Honey Company (BHC) has raised £540,000 after expenses at 80p each. This cash will finance product development, costs related to reducing expenses and fund growth. Mark Jones has been permanently appointed as chief executive. The company is changing its name to Union Distillers.
Vulcan Industries (VULC) is acquiring Aftech, a sheet metal fabrication company, for £1.55m in shares issued at 1.257p a share, plus 24.7 million warrants exercisable at 3p a share. Services provided include laser cutting, bending and forming and the acquired business fits well with existing subsidiaries. In the year to November 2021, Aftech generated revenues of £1.18m and EBITDA of £266,000 and it has debt of £155,000.
AIM-quoted Asimilar (ASLR) plans to join the access segment of Aquis on 4 April. The technology investment company focuses on areas including big data, machine learning and Internet of Things. The corporate adviser is Oberon Capital. Chris Akers has a 6.88% stake and Nigel Wray a 9.43% shareholding. Net assets were £41.5m at the end of September 2021.
VVV Resources (VVV) has signed a conditional agreement to acquire a company that owns the Mitterberg copper project in Austria and a 49% stake in the Shangri La polymetallic project in Western Australia, which takes VVV’s share to 100%.
EPE Special Opportunities (ESO) increased its NAV from 437.6p a share to 455.7p a share in the 12 months to January 2022. However, the Luceco share price has fallen back since then. The Luceco stake was reduced to 22.1% last year. Cash was £27.6m at the end of January.
Capital for Companies (CFCP) had cash balances of £4.19m at the end of February 2022. Net assets were 68.4p a share, following the payment of 1.5p a share dividend on 3 March.
Jason Brewer has joined the board of All Star Minerals (ASMO) and been appointed as chief executive. The acquisition focus has switched to near-term production and revenue generating mining assets.
AQRU (AQRU) has entered a partnership with institutional lending platform owner Maple Finance, which will offer AQRU customers enhanced yields in decentralised finance. Yields could be up to 15%. The offering will be integrated into the AQRU mobile and web-based platform.
Clean Invest Africa (CIA) has obtained a new strategic investor and there could be more to come. Ramin Salsali has invested £302,276 at 0.5p a share to take a 4.67% stake. He believes that the CoalTech technology can help to solve the problem of 33 billion tonnes of toxic coal fines. The technology can also pelletise other materials. Several testing phase projects are at an advanced stage.
AIM
Cyber security software supplier Kape Technologies (KAPE) reported 2021 figures in line with its trading statement with pre-tax profit of $75.2m. This was without any significant contribution from the ExpressVPN acquisition, which was made at the end of the year. Pre-tax profit could more than double to in excess of $150m this year.
Geospatial software provider IQGeo (IQG) beat expectations for 2021 with a much lower loss of £2.7m. Annualised recurring revenues were £8.2m. This year the company should move towards breakeven.
Restaurant operator Tasty (TAST) bounced back into profit last year. In the 52 weeks to 26 December 2021, revenues improved from £24.2m to £34.9m. There was £11m in the bank at the end of 2021 and there are £1.25m of borrowings to offset against this. Even if deferred payments are taken into account, then underlying net cash is still £6.8m. Net assets are £1.9m.
Peel Hunt has upgraded its 2022 forecast for promotional goods platform operator The Pebble Group (PEBB) following the recent 2021 figures. Even so, pre-tax profit is forecast to dip from £10.2m to £9.9m.
Leather processor Pittards (PTD) returned to profit in 2021, but cost increases mean that WH Ireland has reduced its 2022 pre-tax profit forecast. Pre-tax profit is expected to be flat at £500,000. Net assets are 101.9p a share.
AI-enabled wound imaging technology developer Spectral MD (SMD) has made excellent progress since floating last year. Studies of the DeepView system have been positive. The technology enables earlier intervention to help wounds heal quicker than they would have done. A validation study for patients with diabetic foot ulcers is planned and could lead to an application for FDA clearance by the end of the year.
Judges Scientific (JDG) increased pre-tax profit from £13.7m to £18.1m in 2021. Revenues recovered in all geographical regions. The order intake in the first eleven weeks of this year is slightly ahead of the 2021 figure. Net cash is £1.4m and cash generated from operations will mean that the cash pile will build up ahead of any acquisitions.
MAIN MARKET
LED lighting and wiring accessories supplier Luceco (LSE: LUCE) reported an increase in 2021 underlying pre-tax profit from £28.7m to £37.4m on revenues increasing from £176.2m to £228.2m. The total dividend was raised from 6.2p a share to 8.1p a share and it is more than twice covered by earnings. Luceco has moved into the electric vehicle charging market with the purchase of residential EV charge point supplier Sync EV for £10m – it already had a 20% stake, so the latest outflow is £8m. Annual revenues are £4m.
LeakBot reversed into Spinnaker Acquisitions to form Ondo Insurtech (ONDO). The total cost is £9.8m made up of cash of £1.6m, loan notes of £6.4m and 15 million shares issued at 12p each, including 1.36 million shares issued to Ondo Insurtech chief executive Craig Foster. The LeakBot device uses internet of things technology to identify leaks and stop them before they become more substantial. The core client base is home insurers, which can save money on claims. The share price started at 10.5p and fell to 9p by the end of the week.
RC365 Holding (RCGH) was set up to acquire Hong Kong-focused Regal Crown UK, which has developed payment gateway technology and provides other IT services. The holding company raised £2.02m at 6.2p a share, although £800,000 went on float expenses. The shares ended the week at 7p.
Beacon Rise Holdings (BRS) is the latest standard list shell, and it is highly illiquid with most of the shares owned by nine shareholders. On Sharepad.co.uk there are no trades reported, and the bid/offer spread is 100p/400p. That suggest a mid-price of 250p or a notional 150% gain – although the bid price is equal to the subscription price. Pro forma net assets equal the cash of £744,000.
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
Quoted Micro 21 February 2022
AQUIS STOCK EXCHANGE
National Milk Records (NMRP) improved interim revenues by 6% to £11.4m, while pre-tax profit increased by 53% to £750,000. There was a £1m cash inflow from operations. Net debt was £1.1m at the end of December 2021. Genomics testing revenues were 17% higher. The interim dividend has been raised from 1.25p a share to 1.5p a share. Milk prices are strong, but costs are increasing.
Grid storage technology developer Invinity Energy Systems (IES) plans to gain a quotation on Aquis, while retaining its AIM quotation. This is so that it can also obtain an Aquis Access quotation for its warrants, which were issued in a fundraising at the end of last year. The short-term warrants are exercisable at 150p a share up until 15 September. The long-term warrants are exercisable at 225p a share up until 16 December 2024. The current share price is 77p.
Natural foods company S-Ventures (SVEN) has acquired the business of Livia’s Health Foods, which makes plant-based food treats. This includes Million Squares, Nugglets and Dunx. S-Ventures is paying £350,000 in cash and shares. The business has been loss making and generated revenues of £1.3m in the 12 months to January 2022. If revenues exceed £600,000 in the 10 months after acquisition than a further £100,000 is payable. VSA forecasts S-Ventures 2022 EBITDA of £1.8m.
Goodbody Health inc (GDBY) is launching blood testing through itkino, nbi, fire, shnj, coin, s network of clinics. More pharmacies are being added to the network. Covid tests are running at more than 500 a day even though UK testing requirements have been eased. The first clinic has been opened in Vancouver, Canada. Arden is forecasting a 2022 pre-tax profit of £5.1m, but this could depend on whether the level of Covid testing continues at these levels.
ChallengerX (CXS) has appointed John May as non-exec chairman and Brian Connell will take over as chief executive. Management is trying to unfreeze cash held in the accounts of its French subsidiary and says that they were mistakenly frozen after the former chief executive was arrested. There is still £550,000 of cash available for use by the company.
Western Selection (WESP) increased net assets to 68p a share at the end of 2021 thanks to gains on disposals and an uplift in the remaining stakes in Kinovo (KINO) and Northbridge Industrial Services (NBI). Net debt was £674,000 at the end of December 2021. There is no dividend.
IamFire (FIRE) has subscribed for a further £2m of convertible loan notes in WeShop. The conversion price is 75p a share. The beta version of the WeShop platform is on course.
Rogue Baron (SHNJ) is launching its Shinju whisky in the UK. This will be the first market with an 8-year old version of the whisky.
Coinsilium Group Ltd (COIN) is advising fashion brand Blvck Paris for the launch of the Blvck Genesis NFT collection.
Hydrogen Utopia International (HUI) says that talks with Mitsubishi Heavy Industries concerning the potential development of plastic waste to hydrogen facilities in Japan have ended.
SuperSeed Capital (WWW) managing director Mads Jensen has bought shares, while related party Capex Ventures sold 50,000 shares at 100p each, taking his interest to 81.9%. The shareholding of Anne Mette Horneman increased from 4.25% to 6.75%.
AIM
Franchise Brands (FRAN) has launched a recommended all share bid for kitchen services provider Filta Holdings (FLTA). The offer is 1.157 shares for each Filta share. Management and related parties own the majority of Filta. Shareholders owning more than 81% of Filta are backing the bid. Filta boss Jason Sayers will continue to run Filta, which provides cooking oil filtration and drain management services to restaurants and other venues in the UK and North America. Metro Rod, Metro Plumb and Willow Pumps are already owned by Franchise Brands and these services can be offered to Filta’s customer base in the UK.
Shield Therapeutics (STX) got off to a slow start with its Ferracu iron deficiency treatment launch in the US. Total 2021 revenues, including European income, were £1.5m. Forecasts are all over the place. The statement was in line with Peel Hunt’s forecast but well below the finnCap estimate. The 2022 revenues forecasts are the other way around with Peel Hunt (£27.9m) being much more optimistic than finnCap (£9.9m). They agree Shield will continue to lose money, though. This shows that management does not have any real idea what is going to happen, or it could have provided better guidance. Hopefully, there shall be better information when the full year results are published.
Circle Property (CRC) is selling one of its main properties and plans to return cash to shareholders. Circle Property is selling Kents Hill Park Conference Centre to LXI REIT for £34.5m – 1.5% ahead of book value. There are plans to sell other properties.
Domain name and online marketing services provider CentralNic (CNIC) is doing much better than initial expectations in 2022. Online marketing services is where the growth is coming from. Broker Zeus has upgraded its 2022 pre-tax profit forecast from $37.2m to $39m. CentralNic is acquiring Fireball Search and the .ruhr top level domain, which has around 10,000 domain registrations, for €600,000 in cash. A maiden dividend is likely to be announced with the 2021 figures.
Cloud-based conferencing services provider LoopUp (LOOP) says the 2021 trading outcome was in line with previously downgraded expectations, but lack of cash could become a problem. Last year’s revenues were £19.5m, down from £50.2m in 2020, which was a bumper year. It is also well below the £42.5m generated in 2019. The loss is expected to be more than £10m in 2021 and 2022. Net debt was £2.5m at the end of 2021 and it is forecast to rise to £5.7m at the end of 2022.
SkinBioTerapeutics (SBTX) is still optimistic about the prospects for the AxisBiotix-Ps food supplement treatment for psoriasis, but the second phase of the launch, which has just commenced, will be an important indicator of success. The first significant revenues will be in the second half of the year to June 2022. The SkinBiotix cosmetic ingredient is ready to be mass produced by Croda, which is talking to potential cosmetics customers.
Frontier IP (FIPP) has raised a further £3.2m from the sale of ADSs in AI-based drug discovery company Exscientia compared with a book value of £1.75m. Froniter IP has raised £6.1m in total and retains 1.17 million ADSs.
Ariana Resources (AAU) will pay a special dividend of 0.175p a share on 25 March with another payment of the same amount due later this year. Ariana says that drilling at the Kilrou deposit in Cyprus has confirmed the existence of gold at the site, as well as copper and zinc.
MAIN MARKET
Antimicrobial and textile odour control materials developer HeiQ (HEIQ) has secured a development partnership with Hugo Boss for HeiQ AeoniQ, a high-performance yarn. Hugo Boss is investing $5m in a subsidiary that holds the technology, which values that company at $200m. AeoniQ is designed as a sustainable alternative to oil-based nylon and polyester, which take up to 1,000 years to degrade and generate $135bn a year in fibre sales. HeiQ AeoniQ yarns are made from cellulosic biopolymers. The LYCRA Company will become the exclusive distributor of HeiQ AeoniQ yarns, and it will also make a financial contribution. The first product should be available in the second half of 2022.
Standard listed shell CYBA (CYBA) has agreed the acquisition of Narf Industries, which is a cyber security business, for $26.5m in cash and shares issued at 2p each. A placing will raise £6m at 2p a share. In 2020, Narf revenues were $2.78m and in the first half of 2021 they were $1.05m. SaaS subscriptions are generating an increasing proportion of revenues. Further acquisitions are planned.
BATM Advanced (BVC) says that its 2021 pre-tax profit figures will be slightly higher than expectations of $23m. The figures will be announced on 28 February.
Cizzle Biotechnology (CIZ) has agreed to acquire a 5% economic interest in AZD1656, a potential treatment for patients with Covid-19. This agreement was made with Conduit Pharmaceuticals and St George Street Capital and is in addition to previous agreements. Conduit has taken a 8.98% stake in Cizzle as part of the deal.
Studio Retail (STU) intends to appoint administrators.
Cash shell MAC Alpha Ltd (MACA) had £700,000 in cash at the end of 2021. Net assets are £369,000.
Andrew Hore
Quoted Micro 20 December 2021
AQUIS STOCK EXCHANGE
The ecommerce technology and brands retailer Samarkand Group (SMK) reported lower interim revenues because of a one-off PPE contract in the previous period. There was a small underlying dip in revenues to £7.17m as the wholesaling business is being run down to a less important level of operations. The two core parts of the business grew revenues. The company’s brands generated £2.25m and the NOMAD ecommerce technology business generated just over £3m. Samarkand remains loss-making. Net cash was £8.8m at the end of September 2021, but Samarkand subsequently acquired Napiers the Herbalists for an initial consideration of £1.7m in cash. Revenues continue to grow at an accelerating rate. The current focus is organic growth through adding new clients.
Rural Broadband Solutions (RBBS) is acquiring Cadence Networks for £80,000 in cash and the issue of two million shares at a notional price of 7p each. Cadence is an internet service provider with revenues of £145,000. It has three data centres in London that Rural Broadband Solutions can use to build its national data network to replace third party providers. This will help to improve gross margins. There are 2,733 premises connected to the fixed wireless network of Rural Broadband Solutions. A placing is raising £1.675m at 3p a share. Directors are subscribing for 18.3 million shares. Investec Bank will advise on infrastructure funding.
VSA Capital (VSA) reported interim revenues of £1.16m and a loss of £235,000. This reflects the delay in the flotation of Tungsten West, which subsequently generated revenues of more than £1m.
Walls and Futures REIT (WAFR) has sold its residential property in Southfields for £662,500, which is a 2% premium to its valuation. This is the final private rental property in the portfolio.
Love Hemp Group (LIFE) generated revenues of £4.33m in the year to June 2021 and revenues from major retailers are increasing. Plans to move to the Main Market are progressing.
Apollon Formularies (APOL) has completed its high-volume processing laboratory. Processing capacity has increased to 20 litres of medicinal cannabis oil a day.
BWA Group (BWAP) says that the independent expert review of the two 90%-owned mineral sands projects in Cameroon supports the potential for significant mineralisation. BWA intends to drill 2,500 metres at Nkoteng and 1,500 metres in Dehane in the first quarter of 2022. An initial mineral resource estimate is expected by next summer.
Igraine (KING) says 2%-owned investee company Excalibur Medicines has completed the ARCADIA phase II clinical trial to assess a potential treatment for diabetics with Covid-19. The trial shows that AZD1656 reduced mortality in patients in combination with other medication. There are no safety concerns
S-Ventures (SVEN) has raised £3m at 70p a share and it will spend the cash on growing its food and wellness businesses. Clean Invest Africa (CIA) has raised £102,000 at 0.5p a share. IamFire (IAF) has raised £4.75m at 3p a share. EPE Special Opportunities (ESO) has raised £20m from a zero dividend preference share offer. EPE has spent £1.1m and £175,000 buying back ordinary shares at 330p each and 350p each respectively.
Rutherford Health (RUTH) has arranged an £8m loan at an annual interest rate of 15%. Schroder UK Public Private Trust and other shareholders will provide the loan in two tranches of £4m. There is also a convertible loan of £2m from LF Equity Income Fund – the conversion price is 176p. This will provide the working capital needed and a longer-term financing will be arranged next year. The cash is required because the cash for the £12.35m placing with SDI Holding has not been received. The acquisition of Proton Partners International has also not been completed.
Western Selection (WESP) has reduced its stake in AIM-quoted Northbridge Industrial Services (NBI) from 11.35% to 9.65%. The sale, at 159.7p a share, raised £791,000. That is a gain on the balance sheet value of £216,000. Harwood Capital has increased its stake from 15.1% to 16.9%, including an unchanged 13.4% held by Gresham House Strategic (GHS).
New chief executive Andrew Carter has bought 66,079 shares in Chapel Down Group (CDGP) at 45.4p each. He owns 99,699 shares. Voyager Life (VOY) chief executive Nick Tulloch bought 537,776 shares at 18p each and chairman Eric Boyle acquired 519,112 shares at the same price. They own 14.3% and 9.1% respectively. Burns Singh-Tennent has bought one million shares in Oscillate (MUSH) at 2p each. He owns 5.22%.
AIM
NWF (NWF) had a successful first half even though feed volumes were disappointing and group figures will be much better than the previous year. Actions taken to retain drivers have helped the fuels and food distribution divisions. Fuels has done better than expected with a short-term boost from fuel shortages, which NWF did not suffer from, in the autumn. The food distribution business is benefiting from increased capacity. Net debt has fallen providing further scope for fuels acquisitions.
Totally (TLY) is acquiring Energy Fitness Professionals (Energy Fit-Pro), which provides workplace fitness services. The total cost will be up to £1.3m and Totally still has plenty of cash to finance further acquisitions. In the year to March 2021, Energy Fit-Pro made a pre-tax profit of £445,000 on revenues of £984,000. There will be cross-selling opportunities.
Digital transformation services provider Made Tech Group (MTEC) grew interim revenues by 131% to £11.7m thanks to the focus on the public sector. Hiring continues ahead of anticipated growth. Short-term gross margin was reduced due to the increased use of contractors.
Multi-utility connections and electric vehicle charging installer Fulcrum Utility Services Ltd (FCRM) is raising £19.5m at 12p a share and it could raise up to £6m more via an open offer. The placing and open offer price is below the underlying NAV of 15.4p a share, although more than 50% of that figure relates to intangible assets. The order book was £80.9m at the end of September 2021.The cash will be used to invest in the smart energy infrastructure sector as meter asset provider (MAP).
Acquisitions and tax adviser K3 Capital (K3C) expects to report a 30% increase in interim revenues to £30m through a combination of like-for-like growth and acquisitions. The diversification into additional services provides a stronger base for the group.
Hurricane Energy (HUR) could make a $54m write-off on its activities in the Greater Warwick area (GWA) of the North Sea because it does not want to fund the drilling obligations under the licence.
Tungsten Corporation (TUNG) founder Edmund Truell and his associates are backing a possible bid of 40p a share by Kofax Inc. California-based Kofax is an automated software provider that simplifies the handling of data. The board says that the bid significantly undervalues the digital invoicing business. Cloud-based automation technology provider Jaggaer LLC has decided not to make a rival bid but venture capital firms Accel-KKR, could still make an offer.
Deepmatter Group (DMTR) is seeking more cash, but it will take until early next year to secure additional investment for the digital chemistry data company. At the end of June 2021, Deepmatter had £1.8m in cash and that has fallen to £400,000. Deepmatter is loss-making.
Printed circuit technology developer Trackwise Designs (TWD) is raising £6m at 80p a share, which is a significant discount to the market price at the time of the announcement. An open offer could raise up to £1m. Capital equipment deliveries were delayed, although the EV contract will start next year.
Sovereign Metals Ltd (SVML) was listed on the ASX and obtained a secondary quotation on AIM. A scoping study for the Kasiya rutile project confirms that it is a significant deposit. The NPV8 after tax is $861m with a mine life of 25 years. The capital cost is estimated at $332m.
Youth-focused digital media company LBG Media (LBG) joined AIM in order to build a cash pile on the balance sheet so that organic and acquisitive growth can be achieved. It raised £30m at 175p each, leaving pro forma net cash of £27.1m. The share price ended the first day at 200p and the week at 193.45p.
DSW Capital (DSW) licences its brand to professionals involved in corporate finance and accounting services and provides them with back office support. Many individuals become licensees after working with major accountancy firms. Warrington-based DSW believes that the flotation will boost the profile of the business and enable it to grow geographically and broaden the services provided. DSW raised £5m at 100p a share and the price ended the week at 123.5p.
In the six months to October 2021, Begbies Traynor (BEG) revenues were 39% ahead at £52.3m. Underlying pre-tax profit jumped 60% to £8m thanks to an improvement in operating margin from 14.4% to 16%. Net cash was £1.2 million at the end of April 2021.
Public Policy Holding Company Inc (PPHC) provides public affairs, crisis management and lobbying services in the US. It has three subsidiaries in the top 20 US lobbying firms. A placing raised £11.1m at 135p a share. Although the company has reported losses, a change in bonus arrangements will make it profitable.
Problems at the CHESS naval systems subsidiary led to a slump in interim profit at defence firm Cohort (CHRT), but it still increased the interim dividend by 10% to 3.85p a share. The group order book remains strong and includes some large orders. A new managing director has been appointed at CHESS.
Jade Road Investments Ltd (JADE) says that the structure of restaurants group Fook Lam Moon has changed, and it may no longer own 71%. This could lead to a partial or full provision of the $29.1m valuation in the balance sheet.
MAIN MARKET
Anemoi International (AMOI) has completed the acquisition of id4 AG for £5.33m, with an initial payment in shares with 50% deferred and dependent on achieving targets over the next five years. The SaaS-based business provides anti-money laundering and know your client software products. A placing raised £2.175m at 4p a share.
Spinnaker Acquisitions (SPAQ) is planning to acquire leak detection technology developer HomeServe Labs, from fully listed HomeServe (HSV) for a mixture of cash and shares. The business trades under the name LeakBot and it helps insurers to reduce claims costs. Insurers can provide LeakBot to homeowners free of charge. The company would be renamed Ondo InsureTech.
Marine technology products developer OTAQ (OTAQ) is raising £1.38m at 22p a share. Interim revenues fell from £2m to £1.8m. Net debt was £800,000 at the end of September 2021. The regulatory review in Scotland has held back progress and it continues to do so. There are plans for new product launches.
Publisher National World (NWOR) says full year revenues will be around 85%, following the purchase of JPI Media, with growth in digital income and a slowing in the rate of decline of print revenues. There should be cash of £23m at the end of 2021.
Andrew Hore
Quoted Micro 4 October 2021
AQUIS STOCK EXCHANGE
Wine maker Chapel Down Group (CDGP) increased interim revenues by 35% to £8.11m, which included £287,000 from the brewing business, which has been sold. Chapel Down moved from loss to profit in the first half. Underlying pre-tax profit was £459,000, helped by £73,000 of government grant income. Wine volumes increased by 66%. Pro forma net cash is £6m, following the recent fundraising.
Digital assets investor KR1 (KR1) reported an NAV of 80.3p a share at the end of June 2021, up from 29p a share at the end of 2020. There was a £69.5m gain on intangible and financial assets.
Property investor Ace Liberty and Stone (ALSP) returned to profit in the year to April 2021. The value of the portfolio was 3% higher at £89.9m. A loss of £742,000 was turned into a pre-tax profit of £1.39m. Contracts have been exchanged for the purchase of a property in Stafford for £1.26m, where the annual rent is £95,000. The sale of properties in Leeds and Dudley are due to complete.
Tectonic Gold (TTAU) has sold a 60% stake in Whale Head Minerals to AIM-quoted Kazera Global Investments (KZG) in return for 13.5 million shares, which have been assigned to Consolidated Minerals to settle a A$279,732 loan. Tectonic retains a non-diluting 10% interest in Whale Head Minerals.
Coinsilium (COIN) made a pre-tax profit of £333,000 in the first half of 2021. A net fair value gain on unlisted investments of £793,000 was offset by a £148,000 investment write-down. There was a £136,000 cash outflow from operating activities.
NFT Investments (NFT) had net cash of £29.3m at the end of June 2021. So far, two investments have been made, including one after June. Management admits that the digital asset investment sector has been volatile and NFT is being highly selective.
Cancer treatment company Rutherford Health (RUTH) has increased its full year revenues from £5.6m to £7.3m. The operating loss increased from £25.7m to £31.1m. Additional investment has been obtained since the end of February 2021.
Incanthera (INC) has frilled two trademark names for its Sol skin cancer formulation. They are ACTINOMOD AND ACTINODERM.
Arbuthnot Banking (ARBB) has sold a further 220,000 shares in Secure Trust, raising £2.5m. Arbuthnot retains 399,538 shares in Secure Trust.
Adnams (ADB) director Guy Heald has acquired 3,000 B shares from Sidney Sussex College, Cambridge at £92.86 each. His B shares stake has increased to 17.15%.
S-Ventures (SVEN) has appointed VSA Capital as corporate adviser.
Block Commodities has been withdrawn from Aquis after a six-month trading suspension.
AIM
Frontier IP (FIPP) investee company Exscientia has joined the Nasdaq Global Select Market after a $304.7m offer at $22 per ADS, which values the pharmatech company at $2.6bn. The ADSs ended at $27.10 each on the first day of trading on 1 October. The closing price values the Frontier IP stake at £31.3m. Oxford-based Exscientia is a spin-out from the University of Dundee and uses artificial intelligence to help drug discovery.
Broker Peel Hunt (PEEL) has returned to AIM two decades after its original flotation, which ended with a takeover by Belgian bank KBC. A placing at 228p a share raised £40m for the company and valued it at £280m. Existing shareholders also raised £72m The share price ended the week at 231.3p. In the year to March 2021, Peel Hunt Ltd revenues more than doubled from £95.5m to £196.9m, while pre-tax profit jumped from £34.2m to £120.1m. That reflects another bumper trading period. Because of the reorganisation of the group, the illustrative, adjusted pre-tax profit is £73.6m, up from £19.4m. Revenues for the five months to August 2021 fell from £82.5m to £63.3m.
GreenRoc Mining (GROC) has acquired the Greenland mining assets of Alba Mineral Resources (ALBA) in return for shares equivalent to 54% of the newly floated company. The Amitsoq graphite project has graphite suitable for using in the manufacture of lithium-ion batteries and the Thule Black Sands project in north west Greenland appears to be a continuation of the Dundas mineral sands project being developed by AIM-quoted Bluejay Mining (JAY). GreenRoc raised £4.25m after expenses at 10p a share. The share price has slipped back to 9.35p.
Made Tech Group (MTEC) is a rapidly growing provider of digital transformation services to the UK public sector, including healthcare and defence. It raised £15m at 122p a share when it joined AIM at the end of September. Over the past three years annual revenues have grown at a compound rate of 89% and this growth has been financed without seeking shareholder investment. In the year to May 2021, revenues were £13.3m.
Delivered ready meals company Parsley Box (MEAL) has been hit by supply problems. The available stock is 50% of planned levels, due to staffing and logistics problems at food producers, and Parsley Box has built up its cost base in anticipation of growth. It is set to continue to make losses until the supply problems ease, even though marketing spend will be cut.
Antimicrobial technology developer Byotrol (BYOT) has sold the American rights to the Byotrol24 surface spray to its Americas licensee Integrated Resources Inc for $1.4m (£1m). Byotrol retains the rights outside of the Americas.
Northbridge Industrial Services (NBI) is growing the core loadbanks manufacturer Crestchic and the disposal of the Tasman oil and gas tools business, assuming it happens, will end the associated loss and pay off debt. Group revenues were 22% higher at £19.6m, while operating profit quadrupled to £1.6m. Net debt has fallen from £6.8m to £4.5m. A pre-tax profit of £2.83m is forecast for 2021. The construction of a new Crestchic factory has commenced.
Acquisitions and strong organic growth enabled pharma services software supplier Instem (INS) to increase interim revenues by 41% to £19.8m. Demand for the company’s software is being driven by increased life sciences investment. Instem is on course to increase full year pre-tax profit from £4m to £5.2m.
Cyber security firm Osirium Technologies (OSI) signed up 31 new customers in the first half. It was particularly successful in winning NHS Trusts. Average contract values were lower, but sales bookings were 19% higher. Interim revenues increase by 5% to £740,000, while deferred income was 17% ahead. Partners are being signed up to help with international growth. Full year revenues are expected to be 12% higher at £1.6m, but Osirium will continue to lose money due to continued investment.
Digital TV software technology developer Mirada (MIRA) has changed its strategy and employing resellers. The local presence should enable Mirada to build up its international revenues. Covid-19 hampered deployments and slowed investment decisions. Interim revenues declined by 15% to $11.1m. This is despite the growth in deployments of Mirada’s android TV technology for izzi Telecom, which is the company’s largest customer.
1Spatial (SPA) continues to win new contracts and annualised recurring revenues have increased by 12%. The latest contract for a UK government department is worth £8m.
Data erasure and mobile diagnostics services provider Blancco Technology (BLTG) reported operating 2020-21 profit slightly ahead of expectations. Investec is maintaining its 2021-22 pre-tax profit forecast of £5.4m, up from £5m.
Polymers developer Itaconix (ITX) is still loss making, but interim revenues improved 26% to $1.37m. It has a pipeline of potential deals that could generate revenues that are many times higher than that.
MAIN MARKET
S and U (SUS) reported better than expected interims. Revenues were flat at £42.8m, but the core car finance business is recovering. The loan loss provision was cut from £21.4m to £4.9m. Car finance receivables were slightly higher at the end of the six-month period at £248.8m, even though credit criteria has been toughened. Pre-tax profit more than trebled to £19.9m. This includes an improvement in the profit of the Aspen bridging loan business from £100,000 to £1.5m. The interim dividend is 50% higher at 33p a share. Edison has upgraded the 2021-22 S and U pre-tax profit forecast to £38.7m.
Anglo African Agriculture (AAAP) says that the proposed reverse takeover of Kenya-based Comarco. The loan to the company plus interest, totalling $1.5m, should be repaid by the end of October. The original loan was made in November 2018 and is secured on a company with 4.74 acres of land at Mombassa.
Aircraft lessor Avation (AVAP) reported a $70.1m loss for the year to June 2021 and it is expected to make a much smaller loss this year. Avation has a fleet of 44 aircraft. The company’s cash pile should build up when underutilised aircraft are sold.
Bay Capital (BAY) is a newly floated shell set up by two highly experienced small company directors, Peter Tom and David Williams. It raised £4m at 10p a share and has pro forma cash of £6.64m, which is equivalent to 9.5p a share. The share price ended the week at 18.4p. Acceler8 Investments (AC8) is another recently floated shell where David Williams is a director.
Roquefort Investments (ROQ) is paying £1m in cash and shares for Lyramid, which has a worldwide licence to commercialise patents related to Midkine-based therapies for cancer, kidney disease, autoimmune disorders and Covid-19. Roquefort plans to raise up to £3m. Trading in the shares has been suspended until a reverse takeover prospectus has been published.
Hygiene and protection technologies developer HeiQ (HEIQ) published lower interim revenues because the comparative figures were boosted by Covid-19 demand. Full year revenues are likely to be flat at around $50m, while pre-tax profit would decline from $7m to $3.7m due to a lower gross margin and higher overheads.
Andrew Hore