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Andrew Hore – Quoted Micro 22 March 2021
AQUIS STOCK EXCHANGE
Rogue Baron (SHNJ) has sold a shipment of 857 cases of Shinju Japanese whisky in the US. Each case of six bottles sells for up to $150. There was a total of 9,000 bottles of Shinju sold in 2020. US sales are growing so quickly that the company has decided to focus on the market and delay moves into other markets.
KR1 (KR1) has invested a further $150,000 in Vega Protocol in exchange for 194,999.17 VEGA tokens and made an initial $200,000 investment in the Starks Network. KR1 has also generated a further 77,542.92 Polkadot tokens and they were sold for $1.85m. KR1 still has nearly 3.5 million Polkadot tokens. Mona Elisa has been appointed as a non-executive director.
Block Commodities (BLCC) and Century Cobalt Corporation have entered an option agreement to acquire a 70% interest in a medicinal cannabis licence granted to Magnus Cannabis Group in Zimbabwe. Each of the buyers will hold a 35% interest. The option fee is £50,000. The payment for the interest will be £1.5m in Block shares at 0.07p each and £1.5m of Century Cobalt shares. Block no longer intends to acquire Sierra Leone-based Greenbelt Company.
Chris Akers has increased his stake in Quetzal Capital (WENP) from 9.4% to 15.2%.
Love Hemp (LIFE) has signed a five-year sponsorship agreement with UFC.
David Rigoli is joining the board of Veni Vidi Vici (VVV) and he has an interest in electric vehicle commodities.
AfriAg Global (AFRI) is holding a general meeting on 12 April to gain shareholder approval for the reverse takeover of Apollon Formularies Ltd. AfriAg will change its name to Apollon Formularies.
Wheelsure Holdings (WHLP) has raised £25,000 at 13.5p a share.
AIM
Online fashion retailer In The Style (ITS) joined AIM last week. The share price increased from the 200p placing price to 235p. Existing shareholders raised £46.8m from share sales, while there was £9.1m net raised by the company. There will be more investment in the technology platform and there are plans for an international version of the company’s app.
Underlying 2020 revenues at digital payments business Boku (BOKU) were one-fifth higher at $56.4m helped by a six-month contribution from Fortumo. Profit grew even though there was a higher loss from the identity division. There was net cash of more than $50m at the end of 2020, although that includes cash held on behalf of others. In 2021, there should be further growth in digital payments and an improved performance by the identity division.
Trading at document management and technology recycling business Restore (REST) has continued to improve since the second quarter of last year. In 2020, revenues fell from £216m to 3183m, while pre-tax profit dipped from £36m to £23m. This year pre-tax profit should be getting back towards the 2019 level. There are opportunities for further add-on acquisitions.
Futura Medical (FUM) says that erectile dysfunction topical gel formulation MED3000 should be certified as a class 2B medical device which can be obtained without a prescription. This could happen by May. US approval is also progressing.
Diagnostic data provider and analyser Diaceutics (DXRX) was able to launch its DXRX platform at the end of 2020 and it is already winning projects and building up recurring revenues. In 2020, revenues declined from £13.4m to £12.7m and Diaceutics fell into loss. It should return to profit this year.
Renewable energy company Bion (BION) has opened an office in the UK in order to expand in Europe. Two biogas plants in Malaysia are selling electricity generated from biogas produced from palm oil mill effluent. Another two plants will be generating electricity in the next few months.
Trans-Siberian Gold (TSG) has recommended a 118p a share mandatory cash offer from Horvik, which has already agreed to acquire a 51.2% stake.
Telit Communications (TCM) is releasing DBAY Advisers from its restriction on making a bid within six months of previously ending bid talks.
Waterford Finance and Investment is making a mandatory offer for former AIM company Gulfsands Petroleum having bought the stake previously owned by ME Investments for £3.43m. Waterford is also taking ownership of the convertible loan notes owned by ME. Waterford had a 37.3% stake in Gulfsands and it is deemed to be acting in concert with Blake Holdings, owned by Richard Griffiths and James Ede-Golightly. The Waterford stake in the Syria-focused oil and gas company has increased to 52.45% and the combined stake is 83.93%. The bid is 4.035p a share.
CEPS (CEPS) subsidiary Hickton Group has acquired gas and electrical safety consultancy Millington Lord for up to £1.1m.
Dye and Durham no longer intends to bid for IDOX (IDOX), which has sold its Netherlands grants consultancy.
Tremor International (TRMR) has made a filing with the SEC ahead of a potential US listing. Tremor believes it would get a rating more in line with US Ad Tech companies.
Kodal Minerals (KOD) has raised £3.5m at 0.125p a share. This will be used to develop the Bougouni lithium project in Mali and to fund exploration of three gold projects.
MAIN MARKET
Caerus Mineral Resources (CMRS) joined the standard list last Friday after raising £1.92m net at 10p a share. The share price rose to 13p. Caerus is exploring for copper, gold and silver in Cyprus, having acquired New Cyprus Copper, which owns 70% of a company with 12 exploration licences in four project areas in Cyprus. Completion of a work programme will earn a further 20% stake in the subsidiary with the opportunity to acquire the other 10% within 12 months of the work programme for A$2m.
Supply@ME (SYME) has signed heads of agreement to acquire Singapore-based commodities trade enabler TradeFlow Capital Management.
Standard list shell Marwyn Acquisitions Company 1 (MAC1) is raising £130m at 100p a share. Vin Murria has joined the board and she will be investing £17.5m for a 13.1% stake. Murria is likely to seek a large international software acquisition for this vehicle.
Sanofi is terminating its licence agreement with Oxford Biomedica (OXB) but there should not be any significant impact on medium-term revenues.
Toople (TOOP) continues to reduce monthly cash burn. The proceeds of a sale of 1.05 million shares at 0.06p each by the wife of the boss of a subsidiary will be used to repay a £462,000 loan.
OTAQ (OTAQ) has invested $150,000 and converted its loan notes in Minnowtech, which has developed an imaging product using OTAQ sonar technology. This gives OTAQ a 15.2% stake.
CML Microsystems (CML) says shareholders should receive 50p a share in cash by 26 March. Net cash will be more than £30m after this payment, which comes out of the proceeds of the disposal of the storage division. The continuing communications business generated slightly higher revenues in the second half than in the first half. Orders are improving.
Antimicrobial materials technology developer HeiQ (HEIQ) has signed a five-year contract with ICP, which develops thin film coatings for packaging. ICP will use HeiQ Viroblock in its coatings. This could be worth $8m in the first two years. Over five years the royalty revenues should be $30m. This follows a deal with Berger Paints, which could generate $600,000 over one year.
BATM Advanced Communications (BVC) has received around $29m for the completed disposal of NGSoft. The cash will be reinvested in network function virtualisation and molecular diagnostics.
Andrew Hore
Andrew Hore – Quoted Micro 11 January 2021
AQUIS STOCK EXCHANGE
Standard list shell Baskerville Capital (BASK) plans to switch its quotation to the Access segment of the Aquis Stock Exchange. This move will happen at the time of the reverse takeover of Oberon Investments, the owner of fund manager MD Barnard. The transfer to the Access segment is expected to happen on 5 February, although this depends on completion of the deal.
Walls and Futures REIT (WAFR) increased its NAV to £3.96m at the end of September 2020. The Southfields property has been sold for £660,000, which was a small discount to the previous book value. The remaining residential property will be sold in the next few months. The company will then concentrate on specialist supported housing.
KR1 (KR1) has sold its remaining holding of FunFair tokens for an average price of 2.0207 cents each. That raised $1.28m, which is more than treble the cost.
Wishbone Gold (WSBN) expects the analysis of the aerial magnetic survey of the Red Setter project in Western Australia will be available before the end of the first quarter of 2021.
All Star Minerals (ASMO) continues to review opportunities in the mining sector in Africa. The deal is likely to be funded by a share issue, but more cash will be required.
Arbuthnot Banking (ARBB) non-executive director Nigel boardman has increased his shareholding from 5,020 shares to 11,348 shares. Shepherd Neame (SHEP) director JB Neame has sold 4,000 shares at 690p each and bought back 2,000 shares at 691.5p for an ISA.
Vulcan Industries (VULC) has raised £150,000 in share issues at 5p a share and 5.5p a share. TruSpine Technologies (TSP) is still waiting to receive £250,000 from Evrensel Capital Partners.
Peel Hunt has been approved as an AQSE corporate adviser.
AIM
Capital equipment manufacturer Mpac (MPAC) did better than expected last year although pre-tax profit is still likely to decline from £7.5m to £6.2m. net cash is £5m following the payment of £10m for Switchback last autumn. The order book is worth more than £55m, compared to 2020 revenues of £83m. The focus on healthcare and pharma has helped Mpac.
Judges Scientific (JDG) had a strong second half in 2020 and this has led WH Ireland to increase its 2020 pre-tax profit forecast from £12.1m to £13.5m. The 2021 figure has been maintained at £15.1m. Full year results will be announced on 23 March.
Fashion retailer Joules (JOUL) offset weak high street sales prior to Christmas with strong growth in online sales. Even so, continued uncertainty means that Peel Hunt has reduced its 2020-21 pre-tax profit forecast from £5.4m to £3.5m. Net cash is £13m.
Motor dealer Cambria Automobiles (CAMB) says trading the three months to November 2020 was ahead of the same period last year even though the market remains uncertain.
Wealth management firm Mattioli Woods (MTW) had more than £10bn of client assets by the end of November 2020. Gross discretionary assets under management are £2.9bn. Management is still seeking acquisition opportunities and there is £18m of cash in the bank.
Creo Medical (CREO) has received 510(k) clearance from the FDA for its MicroBlate soft tissue ablation devices. This broadens the range of products with approvals.
AssetCo (ASTO) has acquired a 2.9% stake in investment manager River and Mercantile at 186p a share. This cost £4.7m. There is still around £26m in cash available since the payment from Grant Thornton and after the tender offer to shareholders.
Avingtrans (AVG) is merging its two medical equipment businesses with Australia-based MRI technology developer Magnetica and it will own 59% of the enlarged business after also injecting A$600,000. A further £3.2m investment could increase the stake to 61.2%. The combined business is loss-making but the increased scale will help it to move towards profitability.
Telit Communications (TCM) has ended bid discussions with u-blox, although the potential bidder is still interested in making an offer. An all-share bid of 250p a share was indicated.
Tekmar (TGP) has secured a contract to design and manufacture subsea scour protection for a quay development project, which is worth more than £4m. That will be recognised in this financial year.
IntegraFin has decided not to bid for Nucleus Financial Group (NUC), which increased assets under administration by 8% to £17.4bn in the three months to December 2020. Inflows of funds increased, and outflows fell.
Eqtec (EQT) has signed a memorandum of understanding with Greece-based Nobilis Pro Energy, which will enable Eqtec to be involved in its partner’s pipeline of gasification projects opportunities in Thessalia and central Greece. A joint venture will be formalised.
MAIN MARKET
One Heritage Group (OHG) has acquired a site on Bank Street, Sheffield for £880,000. The final development cost is expected to be £2.9m and gross development value should be £3.6m. The residential developer says that its Burnley development will not be completed until later in the first quarter. Construction of the Waterloo Place development in Salford should commence in the second quarter.
Argo Blockchain (ARB) mined 96 Bitcoin during December. The increase in the bitcoin price means that these are valued at £1.63m. Argo holds 209 Bitcoin. The sharp rise in the share price has led to the exercising of warrants and options. This has raised £1.63m.
Tirupati Graphite (TGR) is on track to commission the Vatomina graphite project in the second quarter and build production to 6,000tpa. Tirupati raised £6m at 45p a share when it floated at the end of last year and the share price has risen to 83p.
Rainbow Rare Earths (RBW) has completed its drilling programme at the Phalaborwa rare earths project under budget and the results are expected before the end of the first quarter.
Pembridge Resources (PERE) has raised £570,000 at 4p each and this should be enough cash to take the company into next year.
Andrew Hore
Andrew Hore – Quoted Micro 21 December 2020
AQUIS STOCK EXCHANGE
Employee ownership investor and adviser Capital for Colleagues (CFCP) increased its NAV by 21% to 52.69p a share in the year to August 2020. There were realised gains of £307,000 and a £1.35m increase in the fair value of investments. There was cash of £388,000 at the end of August 2020. Management hope to pay a 2020-21 dividend of at least 1p a share. Cobrio Fund Partners has increased its stake from 4.58% to 7.55% and they were nearly five months late in announcing this.
Gunsynd (GUN) has made a £200,000 investment in Low 6, a sports betting platform. Low 6 partners with sports teams and plans to float in 2021. Gunsynd has invested a further A$800,000 in Rincon Resources at 20 cents a share as part of its ASX listing on 21 December.
A successful planning permission application for a Sutton development St Mark Homes (SMAP) has led to the announcement of an interim dividend of 3p a share. The ex-dividend date is 29 December. Approval has been gained for additional retail space, which could be let to a large retailer, at an existing development in Sutton plus a new building with 30 apartments. There are also new developments in Hanwell, Finchley and Muswell Hill.
KR1 (KR1) has made two new investments. There was $150,000 invested in 15 million Lido tokens and $200,000 in 797,043.48 Swarm tokens. KR1 has also generated a further 141,564.69 Polkadot tokens since August. These have been sold for $797,000. KR1 still owns 3.5 million Polkadot tokens.
Good Energy (GOOD) has announced three strategic partnerships for its mobility as a service offer. Mina Energy has technology to make home charging more effective. Home Energy Infrastructure can arrange funding for installing EV charging infrastructure. Select Car Leasing can lease the vehicles.
Sativa Wellness (SWEL) says the EU has concluded that CBD is not a drug within the meaning of the UN single convention on narcotic drugs 1961. It therefore qualifies as a food. The company is preparing a novel food dossier for the UK Food Standards Agency in parallel with the EU. The UN has voted to remove cannabis from Schedule IV, the category of the world’s most dangerous drugs, while in the US there has been a bill passed to decriminalise cannabis at the national level.
World High Life (LIFE) has secured a listing for Love Hemp with Boots.
SulNOx Group (SNOX) shareholders have signed an option agreement with Rigworld Group, which could purchase 20 million shares at 40p each up until 31 March. This includes the whole of Nistad Group’s 14.6% stake.
Shareholders in Black Sea Property (BSP) have voted against four resolutions at its AGM, although they did vote for four other resolutions including one to retain the Aquis quotation. The two resolutions relating to Alex Borrelli were withdrawn and he has resigned from the board. Trading in the shares has been suspended until a new non-executive director is appointed.
Imperial X (IMPP) has 450,000 shares in Canada-based Imperial Helium and has subscribed for C$110,000 convertible debentures, which will be converted at a 20% discount to the IPO price.
Vulcan Industries (VULC) has raised £365,000 at 5.5p a share.
AIM
DP Poland (DPP) has agreed the acquisition of rival Poland-based pizza restaurant group Dominium for £22.7m in shares and loan notes of €7.5m. DP Poland raised £3.5m at 8p a share, while 21.8 million of the consideration shares were sold at the same price. The combined group will be one of the top three pizza chains in Poland.
Radio frequency communications networks developer CyanConnode (CYAN) has managed its cash well and continues to grow revenues. In the six months to September 2020, revenues were £1.5m and the loss was £1.37m. In the two months since the period end, revenues have been around £1m. The order book in India is worth £19m, which is equivalent to one million units, and these orders could be deployed over the next two years. There are also orders in Thailand and Sweden.
Construction dispute and property services provider Driver Group (DRV) maintained its profit in the second half of the year to September 2020. Underlying pre-tax profit still declined from £3m to £2.5m on revenues 9% lower at £53.1m. The higher margin Diales expert witness business continues to grow. Net cash was £8.2m at the end of September 2020. The final dividend is 0.75p a share.
Codemasters (CDM) has withdrawn is recommendation of the Take-Two Interactive bid and switched its support to the Electronic Arts offer of 604p a share.
Two companies have decided not to make an offer for Telit Communications (TCM) and that leaves u-blox as the only potential bidder left.
K3 Capital (K3C) is trading strongly and finnCap has upgraded its 2020-21 earnings forecast from 11.4p a share to 11.9p a share. There have been cross-selling benefits from recent acquisitions. The acquisitions business has performed well and there is longer-term potential from the Quantuma insolvency business.
Carpets retailer United Carpets (UCG) has decided to leave AIM and it is launching a tender offer of 6.25p a share for up to 29 million shares.
Property services provider Fletcher King (FLK) fell into loss in the six months to October 2020. Revenues from asset management and fund management clients was steady, but other revenues were weak. There is £3.1m of cash in the bank.
NWF (NWF) says that the fuels division has traded positively, and it has recommenced the process of assessing acquisitions. The new food warehouse is fully utilised, but the volatile demand has hit profitability. Feed volumes were slightly lower than the year before.
Summerway Capital (SWC) is switching its investing policy to the software sector and Vin Murria, who has built up AIM-quoted software companies in the past, is joining the board.
Yourgene Health (YGEN) had a steady first half with Covid-19 testing revenues helping to offset lower demand for other products.
Kodal Minerals (KOD) is acquiring the Fatou gold project in southern Mali. There is a mineral resource of 350,000 ounces of gold and potential to increase the figure.
Touchstone Exploration (TXP) has secured a gas sales agreement covering all production from the Ortoire block in Trinidad.
Trinity Exploration (TRIN) has signed an agreement with the National Gas Company of Trinidad to develop new projects in the Caribbean. This includes renewable energy, stranded gas and a micro liquefied national gas business.
MAIN MARKET
BATM (BVM) is investing $3m in Ador Diagnostics as part of a $10m funding. This will be spent on further develop its technology. BATM has a 36.7% stake.
Contango Holdings (CGO) has a potential 1.8 million ounces gold resource at an average grade of 1g/t at the Garolo gold project in Mali. There is further gold at greater depths. The first gold production could be before the end of 2021.
Spinnaker Opportunities (SOP) has conditionally agreed an all-share acquisition of Kanabo Research and has advanced a further £100,000 to the medicinal cannabis company.
Kin and Carta (KCT) has sold healthcare communications business Hive for £13.8m. The business contributed pre-tax profit of £1.2m last year.
Andrew Hore
Andrew Hore – Quoted Micro 7 December 2020
AQUIS STOCK EXCHANGE
Newbury Racecourse (NYR) has completed the sale of 1.2 acres of land on the northern perimeter of the racecourse for £1.5m. That is equal to book value.
NQ Minerals (NQMI) is able to draw down from its recently arranged $55m loan facility between its subsidiary Hellyer Gold Mines with ING. The cash is being used to pay off previous debt.
Wheelsure Holdings (WHLP) improved revenues from £178,000 to £235,000 in the year to August 2020, but there remain potential delays to sales. That is particularly true of Transport for London because of its financial problems. The loss was slightly reduced from £224,000 to £203,000. Wheelsure has moved from net liabilities to net assets of £7,000.
Four new directors have been appointed to the board of SulNOx (SNOX) following a general meeting and they have replaced the previous directors. Radu Florescu had previously been a director of the company. Shareholders have also given them permission to issue shares.
Trading has recommenced in Altona Energy (ANR) shares after £138,000 was raised at 6.5p a share. Further cash will be required in the next four months. Indications have been received from investors that a move to AIM or the standard list could enable Altona to raise £1m. Due diligence is being completed on the two rare earth acquisition targets in Malawi and Uganda. Christian Taylor-Wilkinson has been appointed chief executive.
Quetzal Capital (WENP) made a pre-tax profit of £276,000 in the year to June 2020. That was due to creditors accepting 7.5p in each £1 they were owed. Business opportunities are being assessed.
Wishbone Gold (WSBN) has applied for a new exploration licence in northern Queensland, which is 15km north west of the Ravenswood gold mine.
IOV Labs Ltd is investing £330,000 in Coinsilium Group (COIN) at 3p a share. One warrant will be issued for each two shares and the exercise price is 4.5p a share. IOV can appoint a director to the board, having increased its stake to 13.9%. Coinsilium says that it has enough cash until January 2022.
BWA (BWAP) reported an interim loss of £2.91m, which reduced net assets to £2.43m. The Cameroon business has marked out two licence areas and the first sampling has been undertaken with the lab results expected. BWA had written off its stake in the Prego prepaid debit card business, but there is a potential takeover by a Canadian listed company.
Belvedere Leisure (BELV) has issued £872,000 of 6.25% secured bonds, September 2025. This takes the number in issue to £979,000.
AIM
Floorcoverings manufacturer Victoria (VCP) produced better than expected interims. Peel Hunt increased its full year pre-tax profit forecast from £9.4m to £28.7m, while earnings are set to improve from 5.6p a share to 17.4p a share. There should be further significant recovery next year, but by then further acquisitions will have been made so the group will be different.
Springfield Properties (SPR) has gained planning approval for its first private rental development in Scotland. It is for 75 family homes at the company’s Bertha Park Village. Springfield will build the homes under a fixed cost contract and hand them to the PRS provider. This provides additional, predictable cash flow.
Online fashion retailer Sosandar (SOS) increased interim revenues by 52% to £4.3m even though marketing spending was reduced. Conversion rates are improving. Sales through John Lewis and Next started in August. The loss was reduced from £2.79m to £1.1m. Marketing has been stepped up and there has been further growth in revenues during the autumn. There was still £4m in the bank at the end of November 2020.
Digital TV software Mirada (MIRA) reported a 5% reduction in interim revenues to $5.5m due to Covid-19 related delays. Allenby forecasts a decline in full year revenues from $13.2m to $11.5m and the loss is expected to increase from $1.42m to $3.26m. Net debt could rise to $8.45m by the end of March 2021. Next year, the loss should be lower and Mirada should be cash generative so net debt would reduce by March 2022.
AssetCo (ASTO) has launched a tender offer for 6.53 million shares at 411p each. That will return £26.9m to shareholders. Following payment from former auditor Grant Thornton, AssetCo should have cash of around £55m.
Tavistock Investments (TAVI) has postponed a general meeting designed to pass a new long-term incentive plan for executive directors Brian Raven and Oliver Cooke. There has been unfavourable feedback from shareholders.
The Property Franchise Group (TPFG) has made a bid approach to fellow residential lettings business Hunters Property (HUNT).
Nucleus Financial (NUC) has received a bid approach from IntegraFin Holdings (IHP) and the offer is likely to be in cash. Aquiline Capital and Allfunds (UK) are also considering offers. Sanlam UK owns 52% of Nucleus.
DBAY Advisers has acquired shares in Telit Communications (TCM) at 194.8p each, so any potential bid will have to be at least at this price.
Invinity Energy Systems (IES) is raising £20.5m via a placing at 175p a share and up to £2m more could be raised through a one-for-64 open offer. The cash will help to scale up production of its vanadium flow batteries.
Pires Investments (PIRI) is subscribing for a 15% stake in decentralised finance company DeTech Studio and it will also be issued four million YOP tokens. YOP is the decentralised finance platform that DeTech is developing. The plan is to make it easier for non-experts to use. The yop token will facilitate engagement with smart contracts on the Ethereum network.
MAIN MARKET
Tirupati Graphite has launched its fundraising ahead of a standard listing on 11 December. It is raising £6m at 45p a share, which would capitalise the company at £33.6m. The cash will be invested in mining and processing of graphite.
Marwyn has launched three new shells on the standard list. Marwyn Acquisition Co I Ltd (MAC1), Marwyn Acquisition Co II Ltd (MAC2) and Marwyn Acquisition Co III Ltd (MAC3) are all seeking acquisition targets in media, technology and healthcare that can take advantage of digitalisation. Directors of past Marwyn shells are investors in the new shells. Each company has issued 700,000 shares at 100p each.
Standard list shell Mining Minerals (MMM) is in discussions with a potential strategic investor.
Andrew Hore
Andrew Hore – Quoted Micro 23 November 2020
AQUIS STOCK EXCHANGE
Daniel Thwaites (THW) had a strong eleven months in the year to March 2020, but the final month was unsurprisingly poor for the brewer and pubs operator. Full year revenues edged up from £96.9m to £98.1m, while pre-tax profit fell from £4.5m to £3.6m. Net debt was reduced from £69.7m to £65.4m, helped by property disposals. No dividends are planned in the near future.
EPE Special Opportunities (ESO) has taken advantage of the strong Luceco (LUCE) share price and sold four million shares for total proceeds of £10m. EPE still owns a 24.9% stake.
KR1 (KR1) has participated in token generation by four platforms. There was a follow-on participation in a Plasm Network distribution event, while KR1 has also received tokens from ChainX, Edgeware and Phala Network. The Phala Network tokens have been sold for nearly $124,000.
BWA (BWAP) has given St George’s Eco-Mining Corp until 27 November to repurchase the company’s investment in Kings of the North Corp.
Tectonic Gold (TTAU) says that the first hole drilled at the Specimen Hill prospect in Queensland has signs of gold bearing mineralisation. A second hole is underway.
Evrima (EVA) and partner Power Metal Resources (POW) have published a drilling update for the Molopo Farms complex in Botswana. The first hole has been completed at the nickel sulphide and platinum project. This confirmed that it is a feeder zone. Samples will be tested. There is a four-hole drilling programme.
Cadence Minerals (KDNC) owns 30% of mining and exploration leases that form part of the Yangibana rare earth deposit. Drilling has confirmed that recent drilling results show an economic mineralised corridor 8km long.
Gledhow Investments (GDH) has taken a 4.82% stake in IamFire (FIRE).
NQ Minerals (NQMI) has raised £835,000 at 5.5p a share, which is below the 7p a share that a UK institutional investor paid last month. Early Equity (EEQP) raised £105,000 at 0.5p a share.
AIM
Trackwise Designs (TWD) is raising a further £11m at 200p in order to finance a new Improved Harness Technology (IHT) manufacturing site to quadruple capacity. That is a large discount to the market price of 320p. A further £1m could be raised via an open offer. Back in March, there was a £5.87m fundraising at 80p a share. That was at the time of the purchase of Stevenage Circuits for up to £2.457m. The rest of that cash was earmarked for capacity expansion. The subsequent orders received by Trackwise mean that further investment in capacity is required. The funding dilutes short-term earnings per share.
Agricultural supplies group Wynnstay (WYN) had a strong end to its financial year, particularly September and October. Feed sales were better than expected. There will be one-off costs for closing three sites. Shore Capital has upgraded its underlying pre-tax profit forecast from £6.7m to £8.1m. The dividend is likely to be maintained at 14p a share.
Immunodiagnostic Systems Holdings (IDH) has broken its record and published interim figures at 6.22pm on Friday. Revenues fell by 27% and the company made a bigger loss.
Staffline (STAF) is selling its apprenticeships business to Babington Business College for a nominal fee. The business was losing money in the first half of 2020, although it was a lower loss than the year before. Staffline will concentrate on recruitment and adult skills training.
Bion (BION) is establishing a biogas consortium with three other companies in Malaysia. The plan is to formalise the partnership so that a special purpose vehicle that would be 55%-owned by Bion will own and operate biogas assets of Bion and Green Lagoon Technology. The new venture would be the largest owner of biogas plants in Malaysia. Shareholders will have to approve the deal if it goes ahead. Bion will work with the other two companies to develop waste-to-energy projects.
Trading is ahead of expectations at Somero Enterprises (SOM) and this should enable a significant supplementary dividend for 2020. The concrete levelling equipment supplier is expected to end the year with net cash of $26m.
Dekel Agri-Vision (DKL) has completed the acquisition of the stake in the Cote d’Ivoire cashew nut processing project that takes its shareholding to 52%. October palm oil production was 1,818 metric tonnes and 1,843 metric tonnes was sold. The average price improved to €636/tonne.
Mirada (MIRA) has integrated Disney+ into its Iris platform for Televisa’s izzi pay TV platform in Mexico.
Invinity Energy Systems (IES) has gained a contract to deliver a 0.5MWh vanadium flow battery system to a site in California. This should generate £480,000in 2021. There is also an order for two smaller battery modules.
Three potential bidders are assessing offers for Telit Communications (TCM) and the latest is u-blox, which is considering an all-share offer worth 250p a share. DBAY Advisors and Lantronix are the other potential bidders.
MAIN MARKET
Packaging supplier Macfarlane (MACF) says that trading in the four months to October 2020 is ahead of the same period in 2019. Full year pre-tax profit is expected to be similar to last year at around £14m. It was previously expected to be more than 10% lower. Arden forecasts a total 2020 dividend of 2.4p a share.
Emmerson (EML) has completed the Environmental and Social Impact Assessment for the Khemisset potash project in northern Morocco.
Petra Diamonds (PDL) has an agreement in principle for a restructuring that involves the raising of money from a loan note issue and the remainder of the loan notes will be converted into shares equivalent to 91% of the enlarged share capital.
Thalassa (THAL) has invested £300,000 in foreign exchange and international payments firm Cornerstone FS for a 3.65% stake. This follows a £3m investment in 8% convertible loan notes in payment systems company Tappit Technologies.
Andrew Hore
Andrew Hore – Quoted Micro 20 January 2020
NEX EXCHANGE
NQ Minerals (NQMI) generated gross revenues of A$15.5m and gross profit of A$7.4m from Hellyer gold mine in the fourth quarter. Full year revenues were A$53.9m and operating profit was A$12.2m. The profit grew steadily quarter by quarter. NQ has raised £311,000 at 7p a share. In December, £300,000 was raised at 6.5p a share.
Clean Invest Africa (CIA) says that is subsidiary Coaltech has signed a memorandum of understanding with the Uzbekistan ministry of innovation and development and Uzbekistan Railway. The coal fines project could have an initial value of $16m. A plant would be built to process coal fines into coal pellets. Coal mining is an important industry in Uzbekistan. There will be feasibility studies and the development of a business plan. This deal comes via the joint venture with Creon Investments, which is focused on Russia and former Soviet Union countries.
Ganapati (GANP) says that its Malta-based subsidiary has signed a two-year endorsement agreement with Welljam, which owns the rights to Usain Bolt’s services and image rights. Ganapati has is launching the first official Usain Bolt online slot game when the Tokyo Olympics are held during the summer. Usain Bolt will be attending the ICE London iGaming event in February. There are initial licence payments for image rights during the development of the slot game and a share of future revenues.
Ananda Developments (ANA) says that its investee company iCAN Israel-Cannabis has raised money via a convertible that places a pre-money valuation of $20m on the company. Ananda invested $200,000 in a convertible loan in August 2018 and $100,000 of the loan has been converted into 120 shares worth $200,000 at the latest valuation. DJT Plants, which is 50%-owned by Ananda, has received planning permission for the construction of a facility for cannabis plant breeding and propagation.
Property investor Ace Liberty and Stone (ALSP) reported a dip in pre-tax profit from £334,000 to £306,000 in the six months to October 2019. The NAV improved from £21.2m to £21.9m over the six month period, even though £349,000 was paid in dividends.
Imperial X (IMPP) has switched its investing strategy back from medicinal cannabis to energy-related businesses. The focus is building a royalty stream from oil and gas interests.
Mark Leigh is taking over from Claire Spencer as finance director of Newbury Racecourse (NYR).
Broadband-focused shell SAPO (SAPO) has raised £27,500 at 2.75p a share.
Diverse Income Trust has reduced its stake in TechFinancials (TECH) to below 3%.
Lawyer Gateley (GTLY) generated organic growth of 10.5% in the first half and it is on course to meet analyst expectations for the full year. The main first half growth was in the corporate and pensions businesses. The most recent acquisition will take annualised non-legal revenues to 12% of the group total. A full year pre-tax profit of £21.3m is forecast.
Regional legal business Knights Group (KGH) increased interim revenues by one-third to £32m through a combination of acquired and organic growth. Underlying earnings were 9% ahead at 5.95p a share. Net debt was £17.1m at the end of October 2019. The interim dividend was raised by 83% to 1.1p a share, although Knights was not quoted for all the comparative period. Two Birmingham-based firms have been acquired since the period end.
Legal firm Ince Group (INCE) raised £12m at 45p a share. The share price has more than halved since the beginning of the year. The January 2019 placing was at 140p a share. There are plans to raise £2m by a one-for-8.398 open offer and £2m via an offer to staff. The cash will enable the working capital facility to be reduced and finance investment in building up staff numbers. Net debt was £10.4m at the end of September 2019.
Pharmaceutical services provider Ergomed (ERGO) has acquired Ashfield Pharmacovigilance Inc for $10m and this will be earnings enhancing in 2020. The deal boosts Ergomed’s position in pharmacovigilance services and gives it a stronger position in the US. Ashfield has annual revenues of $11.6m and contracted future revenues of $9.8m.
Dekel Agri-Vision (DKL) has established a 50/50 renewable energy joint venture with Green Enesys that will operate a 36MW hybrid power (solar and biomass) project in Ivory Coast. This should reduce costs at the palm oil project in Ayenouan. There could be other potential power projects in the region. Dekel is benefiting from the recovery in the crude palm oil price. It produced 37,649 tonnes of crude palm oil in 2019, even though poor weather led to disappointing fourth quarter production. Later this year processing of cashew nuts should commence.
Biopesticides developer Eden Research (EDEN) generated revenues of £2m in 2019, down from £2.8m, and an operating loss of £1.4m. Product revenues grew even though the summer weather restricted usage of Botrytis.
Lettings agency The Property Franchise Group (TPFG) is setting up a financial services division. Acquisitions are planned and the first is a 72.25% stake in Auxilium Partnership, which is the business of newly appointed financial services director Mark Graves. This has been a source of growth for rival Belvoir (BLV).
D4T4 Solutions (D4T4) has confirmed that its second half trading is much stronger than the first half thanks to the contracts won by the Celebrus data analysis software business. The financials sector has been a productive customer base for Celebrus. D4T4 is increasingly winning SaaS business and this could hold back short-term growth, which could lead to the trimming of 2019-20 forecasts.
Instem (INS) continues to increase its recurring revenues. The pharma software company generated organic revenues growth of 12% in 2019. Pre-tax profit is expected to be £3.3m. Net cash was £5.9m. A jump in profit to £4.7m is forecast for 2020.
Estate agency Winkworth (WINK) says 2019 profit was modestly ahead of expectations and a total dividend of 7.8p a share is proposed, which is higher than forecast.
Telit Communications (TCM) did better than expected in 2019 and excluding the former automotive activities revenues grew by 8%. The internet of things technology developer is forecast to make a 2020 pre-tax profit of £20.1m.
Pharma data analytics firm Diaceutics (DXRX) generated more cash tan expected last year and made a small profit. Thee was cash of £11.7m at the end of 2019. The 2020 pre-tax profit could be £800,000.
Barkby Group (BARK) has exchanged contracts on a development site in Huntingdon, which has a gross development value of £10.7m.
Risk management software developer KRM22 (KRM) says 2019 revenues were slightly lower than expected at £4m. Delayed contracts are expected to be signed soon.
Telematics firm Quartix (QTX) managed to maintain revenues at £25.6m in 2019 and a small increase is expected in 2020. The mix of revenues has changed with fleet generating 80%, up from 73%, thanks to growth in the US and France. Insurance revenues fell as expected as low margin business was shed. Pre-tax profit is still expected to decline from £8.2m to £6.6m in 2019, with a further fall to £6.3m forecast for 2020. The dividend is expected to be reduced from 12.4p a share to 12.1p a share, although it will not be fully covered by earnings.
Base Resources (BSE) has increased production guidance for the Kwale mine with midpoints of 78,000t for rutile, 345,000t for ilmenite and 30,500t for zircon. There is a lack of supply of rutile and ilmenite, so this is good news. This should provide a strong boost to profit.
Pressure Technologies (PRES) has been fined £700,000 and will have to pay prosecution costs of £169,000 following the guilty verdict relating to a fatal accident at one of its sites in 2015. The first instalment of £215,000 is due in April with a further six equal instalments payable every six months between July 2020 and January 2023.
Oil and gas explorer and producer Empyrean Energy (EME) is raising £420,000 at 9p a share and chief executive Tom Kelly has contributed £200,000 of that cash. The placing was at a 9% premium to the market price. The cash will be spent on drilling offshore of Indonesia. There is a potential resource upgrade for the Mako gas discovery in Indonesia.
Mereo BioPharma (MPH) says that there have been positive results from the phase 2b study of Setrusumab in adults with osteogenesis imperfecta. They show that it is helping to build bone. A study with children is planned. A meeting with the FDA is due in the coming weeks. Earlier this year, Mereo signed a licence agreement for the use of Navicixizumab in ovarian cancer with Oncologie Inc. An upfront payment of $4m is due.
Nutrition provider Science in Sport (SIS) expects to report 2019 sales of £50.5m with underlying growth of nearly one-quarter. The fastest growth is outside of the UK. River and Mercantile has taken a 5.5% stake.
MAIN MARKET
Shareholders in AIM-quoted Anglo African Oil and Gas (AAOG) have agreed to the sale of 80% of its Congo subsidiary to Zenith Energy (ZEN) and it is waiting for government approval. There is a put and call option over the other 20%. If the call option is exercised Zenith will pay £1m in shares. If the production at the Tilapia oilfield averages at least 4,000 barrels of oil per day for 30 consecutive days, the put option can be exercised and Zenith would pay £2.5m in shares.
Endeavour Mining Corporation has ended its merger discussions with gold miner Centamin (CEY) blaming a lack of information. Endeavour still believes that a combination would be positive. Centamin is raising its final dividend to 6 cents a share, taking the 2019 total to 10 cents a share, up from 5.5 cents a share. Net cash was $348m at the end of 2019. The higher gold price will further boost cash generation. A new chief executive still has to be appointed.
Standard list cash shell Trident Resources (TRR) has £3.29m in cash at the end of October 2019, which is similar to NAV. Management is assessing a few mining project acquisition opportunities.
Stevia sweeteners producer PureCircle Ltd (PURE) says that shareholders owning more than 10% of the share capital have put forward three proposed directors to be voted on at the AGM on 10 February. The company is happy for Sridhar Krishnan, Lai Hock Meng, a former PureCircle director, and Oliver Maes, who was previously a PureCircle director, to be appointed to the board.
Books publisher Quarto (QRT) is raising £13.9m at 68p each. The open offer is underwritten and it will help to reduce the debt burden.
Menswear retailer and hirer Moss Bros (MOSB) Total sales were 3% lower in the 24 weeks to 11 January, but gross margin improved. Hire revenues fell by 17.7%. Cash is £12m.
OTHER MARKETS
Pallets manufacturer RM2 International (RM2) intends to move from AIM to matched bargains market Asset Match (www.assetmatch.com).
Andrew Hore
Andrew Hore Quoted Micro 4 March 2019
NEX EXCHANGE
Proton Partners International (PPI) joined NEX on 28 February and from day one it became one of the largest companies on the market. The introduction price was 225p, valuing the proton beam therapy provider at £334m, and the share price ended the week at 2275p (210p/245p). Woodford-related interests own 41.9% of Proton (www.proton-int.com) and they invested £20m at 200p a share on admission and promised to invest up to £80m at a maximum price of 176p each. Woodford received a further £1m worth of shares at 200p each in consideration for these arrangements. Proton is four years old and it has completed three centres offering proton beam therapy for cancer patients with another planned in Liverpool. Each cancer centre has cost between £35m and £42m. There is also a cancer diagnostics subsidiary. In the eleven months to January 2019, revenues were £1.11m and the loss was £18.6m.
Formation Group (FRM) owns 4.35 million shares in Proton Partners International, which it acquired in March 2018 at 115p each. The 225p a share flotation price means that the value of the 2.85% stake has nearly doubled to £9.78m. At Formation’s AGM, the resolutions to reappoint Grunberg and Co as auditor and for the board to authorise its remuneration were not passed. Michael Kennedy has resigned from the board.
Trading in Dozen Savings (DS01) 5% secured bonds March 2020 commenced on 1 March. So far £91,000 worth have been issued. The plan is to raise up to £7m. The company has been created to offer the bonds to customers of its financial services-focused parent company, Project Imagine (www.projectimagine.com). The bonds cost £100 each and the price at the end of the first day of trading was £107.50 (£90/£125). The FCA has granted Project Imagine an e-money licence and an investment licence.
IFA consolidator AFH Financial (AFHP) says that trading is in line with expectations in the first four months of the year. Past acquisitions are achieving more than 90% of their deferred consideration targets.
Field Systems Designs (FSD) reported a lower profit in the six months to November 2018 because of delays in energy form waste business. Two of these projects have still not been completed. Sales to the water sector have been strong, but they are likely to decline as the latest water regulation AMP6 period. In the six months to November 2018, revenues were flat at £11.8m, but pre-tax profit fell from £168,000 to £46,000.
Sandal (SAND) reported a dip in interim revenues from £1.88m to £1.73m and that led to a swing from profit to loss. EnergieMiHome home automation product sales were lower than expected but the products are being sold in more outlets.
Ace Liberty and Stone (ALSP) has spent £6.17m on two properties that are both let to the Communities and Local Government department, as Jobcentre Plus centres, on leases with an unexpired term of 8.4 years. The property in Bolton cost £2.54m and has a net initial yield of 7%. The Northampton site cost £3.63m and has a net initial yield of 6.75%.
Milamber Ventures (MLVP) says that investee company Essential Learning has been placed in liquidation after problems with historic data led to the company losing its government-funded training contracts. Milamber invested £228,000 in Essential in a two year period and provided services worth £270,000. It also issued £100,000 worth of shares to Essential minority shareholder Goldvista Properties. Goldvista has loaned Milamber £310,000 and this is likely to be converted into shares. Goldvista’s £6,000 loan to Essential has been written off. The shares issued to Gravity Investment Group for a 15% stake in Essential have been cancelled. Milamber is conducting due diligence on apprenticeship training businesses.
Inqo Investments Ltd (INQO) has raised £1m at 90p a share and the cash will be used to invest in healthcare, education and eco-tourism businesses in Africa that are two-to-three years from profitability and have a positive social impact.
Trading in Via Developments (VIA1) debentures has been suspended because the accounts for the year to September 2018 have not been published.
Karoo Energy (KEP) says it intends to move to AIM “as soon as practically possible”. A general meeting has been called for 18 March in order to gain shareholder approval to issue shares at the time of the move.
Altona Energy (ANR) has left AIM and the board intends to visit a vanadium mine in China that could become part of a joint venture. Altona still intends to invest in the Arckaringa coal project in South Australia.
John Eckersley is stepping down as chief executive of Capital for Colleagues (CFCP) in order to focus on his role as managing partner of Castlefield Partners and Alistair Currie will become chief executive.
AIM
Internet of Things products supplier LightwaveRF (LWRF) is raising up to £3m through a placing, subscription and open offer at 8.5p a share. Year-on-year growth in sales in the first quarter was 156% taking the figure to £1.15m.
Churchill China (CHH) and Portmeirion (PMP) have bought the stake in ceramic materials supplier Furlong Mills that was previously owned by Dudson. Churchill has paid £454,000 for 9.5%, which takes its stake to 55.6%. This means that Furlong will be consolidated in Churchill’s figures. In 2017, revenues were £8.6m and pre-tax profit was £500,000. Portmeirion spent £363,000 to take its stake to 44.4%.
President Energy (PPC) is raising up to £6.5m at 8p a share, including a £2.8m debt for equity swap by the chief executive, to invest in its gas infrastructure and accelerate its drilling programme.
Itaconix (ITX) has secured an exclusive global supply agreement with Nouryon for bio-based polymers used in hair care, skin care and cosmetics. This contract comes after a joint development agreement with Nouryon and follows the previous supply agreement for polymers used in detergents. Nouryon will sell the polymers to its own customers in the personal care sector for use in their consumer products.
Audioboom (BOOM) is raising £1.5m at 1.3p a share and this cash will enable the podcast company to make upfront payments for content. Audioboom says that it is on course to achieve higher revenues in 2019 than in the 13 months to December 2018. The success in generating revenues and orders is helping to attract content providers.
Parity (PTY) has won a two-year contract with the Department for Education for the digital transformation of the Funding and Contracting Service, which makes £6bn of payments each year. The deal could be worth up to £4.5m. Matthew Bayfield has taken over as chief executive of Parity from Alan Rommel, who is chief operating officer. Bayfield plans to focus more on the data consultancy activities.
Westmount Energy Ltd (WTE) is nearly doubling its shareholding in JHI Associates Inc to 3% and the investment is 81.8% of Westmount’s gross assets. JHI’s main asset is a 17.5% carried interest in the Canje block, offshore Guyana, which is operated by ExxonMobil. The first well could be drilled by early next year.
Verona Pharma (VRP) used up £18.1m of cash in its operating activities in 2018. There is still £64.5 in the bank. Verona generated positive data for ensifentrine (RPL554) used as a treatment for COPD in a phase IIb clinical trial. The focus is COPD and further trials for cystic fibrosis are unlikely in the short-term. Financial resources will be focused on progressing the nebulised ensifentrine to a phase III study. Verona is likely to seek partners for its dry powder and pressured meter dose inhaler formulations. The results of the part one of the dry powder inhaler clinical trial for COPD could be available before the end of the first quarter. The second phase should then commence with results expected in the second half of the year.
Trading in Herencia Resources (HER) shares has been suspended because it appears that pre-conditions for the financing that has been negotiated are not likely to be met. More cash is required to enable the company to continue trading.
Telematics supplier Quartix (QTX) increased its fleet sales, but insurance business fell and overall revenues profit are set to decline in 2019. In 2018, revenues were £25.7m and pre-tax profit was £8.1m, but that figure is forecast to fall to £6.5m this year.
VietNam Holding Ltd (VNH) has published a prospectus for its move to a premium listing, which should happen on 8 March.
Adamas Finance Asia Ltd (ADAM) has commenced a share buy back scheme for up to $500,000 of shares at a maximum price of 79 cents a share, which is a 25% discount to pro forma NAV. Adamas has separately agreed to buy back 730,529 shares at 10 cents each. The first tranche of 159,847 shares has been issued to China Aerospace for its stake in Hong Kong Mining.
NetScientific (NSCI) says that it will not get the required backing for the resolution to cancel the AIM quotation, so it has adjourned its general meeting. Shareholders owning more than 30% are against the plan.
MyCelx Tech (MYX) has raised $1.83m at 230p a share in order to finance the potential increase in demand for water treatment services.
Telit (TCM) has sold its automotive division for $105m and has received $67.5m in cash, but it has granted the buyer a loan of $38.5m for a six week period because other debt finance was not obtained in time.
MAIN MARKET
Air Partner (AIR) says that its pre-tax profit will be at least £5.8m in the year to January 2019. The charter division was boosted by strong demand for freight and commercial jets. The consulting and training division has won new contracts.
G3 Exploration Ltd (G3E) plans its third demerger in its time as a quoted company. This time shares in Green Dragon Gas, which owns its producing assets, will be distributed to shareholders. Green Dragon Gas will then either be sold or float on the Hong Kong Stock Exchange.
Wealth manager Walker Crips Group (WCW) says that political uncertainty has hit broking commissions and the launch of new products, which means that the 2018-19 results will be lower than for 2017-18. Chief executive Sean Kin Wai Lam has bought 15,000 shares at 28p each.
Laura Ashley (ALY) has rejected the bid approach by Flacks and says that the indicative offer of 2.748p a share fails to provide a fair value for shareholders.
London Finance and Investment Group (LFI) has a 43.8% stake in NEX-quoted Western Selection. In the six months to December 2018, NAV fell from 65.4p a share to 62p a share. The interim dividend is unchanged at 0.55p a share.
BigDish (DISH) has launched a new restaurant bookings website and upgraded its technology. It is also widening its coverage to include Southampton.
Path Investments (PATH) says that the period of exclusivity included in its heads of agreement with ARC Marlborough has been extended to 29 March. The plan is to acquire ARC, which has a nickel and cobalt project in Queensland, via a share issue.
Oil and gas firm Curzon Energy (CZN) has raised £95,000 at 1.58p a share, which is a 21% premium to the market price. The cash will be invested in a gas project in Texas.
Andrew Hore
Ian Pollard – Persimmon #PSN new house price inflation falls to 1%
Persimmon plc PSN claims to have delivered another strong trading performance in 2018 with total Group revenues of £3.74bn., 4% higher than the previous year. A little cloud in the sky appeared in the shape of the average selling price increased by only 1%, which from memory is the lowest for many a year and not something which housebuilders welcome because they think it indicates the market is weak and they can not sell their houses. Housebuyers however can see it as a very good thing which eases the burden of above inflation price increases which the builders used to impose with such glee. Forward sales at 31 December were 3% ahead of 2017 which shows the benefit for the builders of more stable prices. Pre-tax profits for 2018 are expected to follow a similar pattern and be modestly ahead of current market consensus.
Savills plc SVS experienced a robust closing quarter and produced growth in both revenue and underlying profits for the full year. The residential business continued to perform well in challenging market conditions. These achievements came against a backdrop of heightened uncertainty through the last quarter as Brexit, US trade policy produced concerns.
Games Workshop GAW continues to be in great shape says the CEO as the interim dividend is increased from 61p to 65p for the six months to the 2nd December after Revenue rose from £109m. to £125m. Basic earnings per share for the half year have grown from 96p per share to 100.8p
Spirent Comm PLC SPT updates for the final quarter to the 31 December and for the year in full. Revenue for the full year grew by 6% and good momentum continued into the final quarter.On an adjusted basis operating profit is expected to show a 30% increase on the previous year, exceeding market expectations and demonstrating a year of strong profitable growth.
Telit Communications TCM expects revenue for the year to the end of December to show strong profitable growth Aadjusted operating profit is expected to exceed market expectations with a rise of some 30% on the previous year. Shareholder approval for the proposed sale of the automotive division is expected to be obtained on the 29th January and completed on the 31st January.The Executive Chairman claims that over the last few months, the Group has delivered double-digit revenue growth, and improved profitability over the year. The financial performance is expected to be improved further in 2019.
Find beachfront villas & houses for sale in Greece; http://www.hiddengreece.net
Andrew Hore – Quoted Micro 31 December 2018
NEX EXCHANGE
China-based Gamfook Jewellery (GAMF) joined NEX on 24 December. The online retailer of customised jewellery was introduced at 15p a share, and the shares ended the first week at 15.5p (14p/17p). That values Gamfook at £15.5m. Executive chairman Jindian Lin and his wife own 72.8% of Gamfook. A dividend based on 28% of profit attributable to shareholders is promised.
Part of the £407,000 Sanderson Capital Partners loan to Wishbone Gold (WSBN) has been converted into shares. The conversion of £258,500 was done at 0.1247p a share.
Milamber Ventures (MLVP) reported an increased interim loss of £343,000, up from £263,000. There were net liabilities at the end of September 2018, but the balance sheet has been improved by the issue of shares for cash and to pay off creditors. Problems at apprenticeship training company Eseential Learning are being sorted out.
PCG Entertainment (PCGE) had $913,000 in the bank and shareholders’ funds of £1.02m at the end of September 2018. There was a cash outflow from operations of £817,000 in the six month period to September 2018.
A subsidiary of Lombard Capital (LCAP) is issuing two bonds. The first is a 4% bond, raising up to £50m and expiring at the end of January 2022, and the other is a 4.5% bond, raising up to £90m and expiring at the end of January 2024. It is intended that both bonds should be lised on a recognised exchange.
AIM
For a change the last major announcement of the year is a positive one. Gordon Dadds (GOR) has completed the acquisition of international law firm Ince UK and it will trade as Ince Gordon Dadds. Trading in the shares recommences on 2 January. The deal will cost £27.3m over four years, plus options over three million shares, and the combined group generated fees of £30.5m in the year to April 2018. The deal should be earnings enhancing in the current financial year.
Earthport (EPO) is recommending a 30p a share bid from Visa Inc. This values the payments technology company at £198m. The bid is 50% higher than the 20p a share placing price in October 2017, but lower than the 40.85p a share placing price in September 2014.
Chamberlin (CMH) improved its trading in the first half and the cash from the sale of the Exidor business has improved its balance sheet. The foundries business moved back into profit in the first half as demand continues to increase for turbo charger housings, which are used for hybrid cars as wells as conventinal ones. The company’s debt has been reduced from £10.5m at the end of September 2018 to £3.7m. The pension deficit has been cut from £4m in the last balance sheet to £1.5m.
Facilities management and security services provider Mortice Ltd (MORT) increased its interim revenues by 10% to $116.7m. Underlying pre-tax profit was 5% ahead at $2.3m. Net debt was $20.1m at the end of September 2018.
TUS International has published a circular for a general meeting in January in order to gain shareholder approval for the acquisition of the Telit Communications (TCM) automotive business, whose reorganisation is near completion.
In the six months to September 2018, Stanley Gibbons (SGI) continues to lose money although costs have been reduced. Revenues fell from £7.14m to £5.03m. Coins and medals are the part of the business still making a profit. The overall loss has been reduced from £2.93m to £2.37m.
The People’s Operator (TPOP) does not expect to appoint a new nominated adviser and the share placing with the owner of LycaMobile has been pulled. The investment of £1.3m in shares (29.9%) and convertible loan notes will not go ahead but the potential investor is considering its options. The AIM quotation will be cancelled on 3 January.
TSX-V quoted PetroTal Corp (PTAL) has gained an AIM quotation. The Peru-focused oil producer is developing its interests at Bretana and growing near-term production.
IT compliance and security services provider GRC International (GRC) increased its interim revenues by 54% to £8.91m, thanks to a boost from GDPR, but it moved from a pre-tax profit of £614,000 to a loss of £2.18m. There was additional investment following the flotation of the company in March. Cash is running out and an overdraft and a loan facility have been secured.
Gaming technology developer Nektan (NKTN) is raising £1.5m at 15p a share, although not all the shares will be issued until the company gets shareholder approval at the AGM on 7 February, and it will generate £2m from the sale of 57.5 of US subsidiary Respin. There are also plans to restructure the conversion terms of loan notes and a shareholder loan. These proposals are dependent on each other going ahead and on the successful negotiation with the HMRC over the payment terms for £2.9m of UK point of consumption tax. There was £1.4m in cash at the end of June 2018, which is similar to the cash outflow from operations in the preceeding 12 months.
Functional food ingredients developer Provexis (PXS) improved interim revenues from £124,000 to £194,000. The company’s Fruitiflow products are being more widely sold and the prospects for the deal with BY-HEALTH in China are positive. Pro forma cash was £556,000.
Veltyco Group (VLTY) is going to launch its own regulated financial trading brand in the first quarter of 2019, although this depnds on regulatory approval.
Oil and gas explorer and producer Cabot Energy (CAB) says that it is still trying to raise cash via a share issue and it would be at a large discount to the current share price. The cash needs to bre raised by the end of January in order to pay overdue creditors and provide working capital.
Building materials sector consolidator SigmaRoc (SRC) has announced its plans to redeem its £10m of 6% convertible loan notes. SigmaRoc is offering 105p for each 100p loan note, plus 0.378p a note in interest payments. The last acceptance date for the tender is 16 January.
Mobile commerce services provider Bango (BGO) will be loss-making in 2018, although there was an EBITDA in the fourth quarter. End user spend more than doubled to £550m. There should be £3.5m in the bank at the end of 2018.
WANdisco (WAND) has secured a three-year agreement with an American healthcare company worth £700,000. The deal involves WANdisco Fusion and comes via the sales partnership with IBM.
Paracale Gold is providing a loan of up to $1.224m to Goldstone Resources (GRL) to finance the development of the Akrokeri-Homase project in Ghana. This mine could be in production in 2020. Paracale will receive 40.35 million warrants exercisable at 1.2p a share, which replace existing warrants.
Mobile payments technology provider MobilityOne Ltd (MBO) has secured an agency and reseller agreement with MBP Solutions for the company’s products in Malaysia.
In the six months to September 2018, Vast Resources (VAST) reported a 8% increase in gold production to 13,352 ounes at the Pickstone-Peerless gold mine in Zimbabwe. There was a 61% increase in copper concentrate produced to 1,526 tonnes at the Manaila polymetallic mine and zinc concentrate produced has nearly doubled to 199 tonnes. Revenues increased from $14.9m to $21.9m. There was still a cash outflow from operations of $1.79m.
Michael Principe and Greg Genske have resigned from the board of TLA Worldwide (TLA) following the sale of its core US business. The agreement with SunTrust Bank to defer capital and interest payments has been extended to 31 January.
Phoenix Global Mining (PGM) has raised £358,000 at 28p a share. There is a warrant exercisable at 28p, lasting until the end of 2021, with every four new shares. The cash will be invested in the Empire copper, gold, silver, zinc and tungsten mine in Idaho, where news of the most recent drilling is expected. A new resource statement will be prepared and additional acreage acquired.
Urban Exposure (UEX) had committed new lending of £522m during 2018. It has secured a £165m loan facility for its joint venture with KKR, as well as a £32.8m loan from Aviva for a single transaction by the joint venture.
MAIN MARKET
Nanoco (NANO) has achieved the third milestone in its cadmium-free quantum dots technology development and supply agreement with a US customer and triggered a £1.6m. This is the final milestone of three and they have generated £4.2m.
Robin Boyle has requisitioned a general meeting at Athelney Trust (ATY) in order to get himself reappointed. He also wants David Lawman and Paul Coffin to be appointed and the three existing directors, Dr Emmanuel Pohl, Simon Moore and Jemma Jackson, to be removed. The other two resolutions are to terminate Jason Pohl as alternate director and any other director appointed by the time of the general meeting on 22 January.
Standard list shell Stranger Holdings (STHP) is still awaiting UKLA approval for its proposed reverse takeover of waste energy technology developer Alchemy, which was announced in August 2017. Management is hopeful that the deal could go ahead by the end of the first quarter of 2019. Stranger had net liabilities of £435,000 at the end of September 2018.
Dukemount Capital (DKE) has forward-funded and pre-sold its first development at West Derby to a fund managed by Alpha Real Capital. Dukemunt will receive £570,000 for the site and the total funding package for the development will be £3m. The development involves demolishing the existing building and constructing 17 supported living appartments and retail space. Dukemount continues to manage and develop the project on behalf of the supported living housing association that has taken a 50-year lease.
Andrew Hore
Andrew Hore – Quoted Micro 17 December 2018
NEX EXCHANGE
Ecommerce software provider Netalogue Technologies (NTLP) moved into profit in the first half and had £648,000 in the bank at the end of September 2018. Revenues increased by £168,000 to £647,000, even though subscription-based pricing is reducing the initial revenues from B2B clients. A loss of £60,000 became a pre-tax profit of £142,000, helped by lower operating expenses.
Veni Vidi Vici Ltd (VVV) is acquiring a 51% stake in a licence in the Shangri La gold, silver and copper project in Western Australia for A$220,000, which is payable to Goldfields Consolidated in the form of 190,000 shares and A$20,000 in cash. The shares cannot be sold for three months. VVV will spend an initial A$300,000 over three years and Goldfields will receive a 10% management fee.
Coinsilium Group Ltd (COIN) has raised £367,000 at 4p a share and each new share comes with a two-year warrant exercisable at 7.5p a share. If the share price averages more than 15p for five consecutive days, then the company can require the warrants to be exercised.
Gastropubs operator Barkby Group (BARK) has signed heads of terms to acquire Northamptonshire-based upmarket car dealer Centurian Automotive Ltd. The most recent accounts were for a dormant company and shows £200 in the bank.
Quetzal Securities Ltd sold 6.75 million shares in Pelican House Mining (PHM) for 0.5p each and Eight Capital Partners (ECP) acquired 8.25 million shares at 0.491p each. Quetzal subsequently sold a further 6.75 million shares in Pelican shares, leaving a 13.2% stake, to Eight Capital at 0.5p a share, taking its stake to 15.3%.
Hydro Hotel, Eastbourne (HYDP) has declared an unchanged total dividend of 21p a share for the year to October 2018. An interim of 7p a share will be paid in January (ex-dividend 20 December) and a final dividend of 14p a share paid in May (ex-dividend 18 April).
Ace Liberty and Stone (ALSP) has appointed Northland as broker.
EPE Special Opportunities Ltd (EL.P) had a NAV of 200.95p a share at the end of November 2018. The shares are trading at 160p.
Construction consultancy Driver Group (DRV) reported a 2017-18 pre-tax profit of £3.8m, up from £2.5m, and it is returning to paying dividends with a 0.5p a share payment. Net cash is £6.9m, helped by a property disposal, and this could reach more than £10m by September 2019 even after dividend payments. The Diales expert witness business is becoming an increasingly important revenue generator and overall utilisation levels have improved. There has also been a focus on better margin work in the Middle East.
SigmaRoc (SRC) is in the process of acquiring precast concrete products supplier CPP Building Products for £15.2m, although the deal requires shareholder approval for share issues, so it will not happen until early January. CPP is based in north west England and fits well with the existing precast concrete business. In the year to August 2018, revenues were £20.9m and EBITDA was £2.6m. This year’s trading is in line with expectations. There are plans to refinance the convertible loan notes.
Nexus Infrastructure (NEXS) had already warned about delays to its utility connection contracts with housebuilders and the 2017-18 figures were slightly better than expected with flat pre-tax profit of £9.2m. Nexus has a strong order book and could increase its 2018-19 pre-tax profit to £10.4m. The new electric vehicle charging points division will take time to build up.
Advanced coatings provider Hardide (HDD) has benefited from an upturn in demand from the oil and gas sector. It is also getting nearer to obtaining its first aerospace orders. Hardide remains loss-making and this will still be the case next year as it continues to invest in increasing capacity in the UK and US as demand grows.
Curtis Banks (CBP) has purchased around 600 SIPPS with assets of £180m from Hargreaves Hale, which will continue to manage the assets. Curtis Banks will launch a new SIPP product in January.
Clinical trials manager Venn Life Sciences (VENN) is collaborating with Open Orphan DAC. The two firms will share resources in the orphan drugs market. Venn is raising £1m from a two-year loan note issue.
WH Ireland has upgraded its forecast for banknote authentication and brand protection technology business Spectra Systems (SPSY) for the second time. The underlying pre-tax profit forecast has been raised by 10% to $4.5m. The 2019 forecast, which had previously been upgrade by 16%, is maintained for the time being.
Kibo Energy (KIBO) says that its 60%-owned subsidiary MAST Energy Developments has an exclusive option to undertake due diligence and acquire three peaking power sites totalling 31.3MW. This would provide initial revenues for Kibo later next year. Kibo has renewed its memorandum of understanding with Mozambique-based electric utility Electricidade de Mocambique for the financing and operation of the Benga independent power project.
eServGlobal Ltd (ESG) says that 2018 revenues will be lower than expected due to weak trading at the PayMobile business and the failure to close orders. The PayMobile business may be sold and the focus will be the HomeSend remittances business.
NWF (NWF) says feeds demand was strong in the summer because of a lack of natural grazing. In contrast, the hot weather held back demand for fuels. A Solihull-based fuel distributor has been acquired. The food distribution business continues to trade at around capacity because of contract wins. The interims will be published on 29 January.
ReNeuron (RENE) has important clinical trial results coming up in the next 18 months. A retinitis pigmentosa treatment is in phase I/II trials and there should be data in mid-2019. A phase IIb trial for a CTX cell therapy-based treatment for chronic stroke is due to report by early 2020. There was £30.7m in the bank at the end of September 2018. Management is seeking partners to help it to make the most of its technology.
PhotonStar LED Group (PSL) has raised £100,000 at 0.02p a share and this will enable the board to assess new business opportunities.
Property adviser Fletcher King (FLK) is maintaining its interim dividend at 1p a share even though pre-tax profit has dipped from £148,000 to £132,000. Ratings appeals revenues were lower. There is £2.28m of cash in the balance sheet.
Kromek (KMK) has secured an initial contract with the US Department of Defense worth $2m over 12 months. The plan is to develop a proof-of-concept device for a vehicle-mounted biological threat identifier.
Crossword Cybersecurity (CCS) started trading on AIM on Friday and the share price ended the day at 272.5p. Crossword raised £2m at 290p a share.
Volex (VLX) is buying cable assemblies and connectors manufacturer GTK for £14.3m in cash and shares. in the year to July 2018, GTK generated a pre-exceptional operating profit of £1.7m. There was £1.3m in the bank. The deal is earnings enhancing.
African Battery Metals (ABM) has found it difficult to raise the cash it requires and trading in the shares has been suspended. The company wants to come to a settlement with creditors so that it could continue to trade.
Smaller company mergers and acquisitions business K3 Capital Group (K3C) is cautiously optimistic but the full year outcome will depend on the timing of deals. There could be a small dip in pre-tax profit to £7m this year and there could be a corresponding dip in dividend from 11.2p a share to 10.8p a share.
Telit Communications (TCM) says that it will not complete the sale of its automotive business until next year. Telit is expected to make a 2018 loss. Further cost savings are being made in the Internet of Things operations.
More bad news from Filtronic (FTC) with sales of Massive MIMO antennas lower than expected. The main customer has reduced its forecast demand. The capitalised development costs of £500,000 will be written off and options are being reviewed. The rest of the business is trading in line with expectations. Filtronic will be loss-making this year. Net cash was £2.3m at the end of November 2018.
Science Group (SAG) has ended its formal sale process because of stockmarket and exchange rate uncertainty. The strategic review continues. Trading is in line with expectations and the company will recommence the share buy back programme. Net cash was £6.4m at the end of November 2018.
Like-for-like sales growth has been slowing at DP Poland (DPP) and this means that progress in 2019 is unlikely to be as good as expected. This means that it will take longer to reach profitability. Rivals have been spending money on marketing and warm weather has also held DP Poland back. A full year trading update will be published on 29 January.
Taptica International Ltd (TAP) plans to spend up to $10m on buying back shares and it has already spent nearly £110,000. There was net cash of $42.1m at the end of June 2018.
Tristel (TSTL) says that the US regulatory process for its disinfection products is on track and interim pre-tax profit should be £2.2m.
TomCo Energy (TOM) has managed to secure £550,000 at 2p a share. The previous £532,000 placing at 8.5p a share was pulled. Laurence Read has become a non-executive director.
RA International (RAI) has won a five year contract worth up to $5.6m from a US corporate client in Central Africa.
MAIN MARKET
Circassia Pharmaceuticals (CIR) is moving to AIM and it has decided to exercise its option to acquire US rights to COPD treatment Tudorza from AstraZeneca. This deal should complete by the end of the year and it will trigger a payment of $5m. A further $20m is payable upon approval of Duaklir and then there is further deferred consideration of $100m.
Tex Holdings (TXH) has warned that second half earnings will be lower than anticipated due to delayed deliveries and reorganisation costs.
Cadmium-free quantum dots developer Nanoco (NANO) is on course to complete the expansion of its Runcorn facility by the end of 2018 with commercial volume manufacturing by the middle of 2019.
Lb-shell (LBP) is being wound-up because of potential litigation relating to before it became a shell. There is unlikely to be anything left for shareholders.
Giant Saint Technologies Ltd (GST) is installing a $1m data centre in Singapore.
Andrew Hore