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Quoted Micro 26 August 2024
AQUIS STOCK EXCHANGE
Voyager Life (VOY) says M3 Helium, which it has an option to acquire, has commenced production at the Smith and Nilson wells and they will begin to generate revenues after being attached to the Scout Energy Partners gathering system. Once production is stabilised the helium content should be around 0.635%. The Rost well is the next to be brought into production.
Time to ACT (TTA) has separated Diffusion Alloys into a coating technology business, including the low-cost modular coating equipment being developed, and the plant-led coatings business in Middlesborough.
Kondor AI (KNDR) is considering a bid for Ora Technology (ORA) based on 0.9988 of a Kondor AI share for each Ora Technology share with the latter’s shareholders owning 53.4% of the combined group. The group would be worth £38.5m at the current suspended share prices. There is no certainty that the bid will be made.
EDX Medical (EDX) has entered an agreement with Oxford University to in-licence intellectual property developed in Oxford and Birmingham Universities in research funded by Cancer Research UK. The IP can be used to improve the test for safety and dose management for patients receiving 5-fluorouracil and other chemotherapy medications that carry serious side effects.
Equipmake (EQIP) says that an electric bus has started operation in Argentina, and it uses the company’s zero emission drivetrain. The bus operator DOTA plans to add to the electric bus fleet.
Vinanz Ltd (BTC) has started a new Bitcoin cluster in Texas and once the initial miners are up and running consistently more will be installed. This follows 100 Bitmain Antminer S19J Pro ASIC Bitcoin miners in Labrador, Canada.
Phoenix Digital Assets (PNIX) has bought three million more shares at 4.15p each. There are 3.5 million shares held in treasury. Toro Consulting’s stake has moved above 21%.
AIM
Oil and gas producer i3 Energy (I3E) is recommending a 13.92p/share bid from Gran Tierra Energy. The offer is one Gran Tierra Energy share for every 207 i3 Energy shares and 10.43p in cash for each i3 Energy shares. Shareholders will also receive a dividend of 0.2565p/share. The bid, based on a Gran Tierra Energy share price of $8.66, values i3 Energy at £174.1m. Gran Tierra wants to diversify its current Canadian resources.
TV and film services provider Facilities by ADF (ADF) has made the significantly earnings enhancing acquisition of Autotrak Portable Roadways, which hires portable roadways. This also diversifies the client base into outdoor events. The initial payment is £13.1m in cash and shares. Up to £8.2m of additional consideration is payable depending on EBITDA up until 2027. Cavendish has increased its earnings forecast for 2025 by 12% to 9.7p. The company raised £10m at 50p/share to fund the acquisition and could raise up to £500,000 from a retail offer, which closes on 29 August.
Maritime AI technology services provider Windward (WNWD) generated organic growth of more than 30% with a reduction in churn. Annualised recurring revenues reached $37.2m at the end of June 2024. Reported interim revenues were $17.6m and the ARR covers the rest of the expected revenues for this year. Maritime Invest Scandinavia has sold its 5.73% stake and West Elk Capital bought 4.99%.
Pawnbroker H&T (HAT) reported continued growth in pawnbroking, although higher than expected redemptions hit revenues, as well as improved performances in retail and foreign exchange. Gold purchasing and scrap is benefiting from the high gold price. Pre-tax profit was 13% higher at £9.9m. From now on, pawnbroking scrap will be reported with the pawnbroking division. The year-end will be changed to September from 2025 onwards.
Education software provider Tribal Group (TRB) can focus on the business now that a settlement has been reached with NYU. The latest figures were held back by the failed bid, which led to delays in client orders. Annualised recurring revenues improved 2% to £52.1m. The educational market is tough, but Tribal’s admissions software is still likely to be attractive to colleges and universities.
Recruitment company Empresaria (EMR) had a tough first half with like-for-like net fee income 15% lower, partly due to currency movements. It does not appear that trading will improve much in the second half. Even the outsourcing business, which has been the star recently, reported a decline because of less UK healthcare business. Cost savings will offset the decline in income in the second half and pre-tax profit is expected to improve from £3.5m to £4m.
Digital cognitive assessment technology developer Cambridge Cognition (COG) maintained interim revenues at £5.6m and the loss was sharply lower. A full year pre-tax profit of £100,000 is forecast for 2024. Expectations are underpinned by an order book of £14.6m.
Data analytics software company Rosslyn Data Technologies (RDT) has secured a three-year contract with a major technology company. This has a minimum value of £2m. Management says that the 2023-24 loss will be lower than previously forecast, but at £3m it will still be higher than in 2022-23. Before the latest deal annualised recurring revenues were £2.3m. William Black and Armstrong Investments reduced their shareholding from 10.4% to 9.51%.
A weak advertising market meant that first half revenues of media analysis company Ebiquity (EBQ) fell 7%. That hit operating margins, which slumped to 6%. Net debt is £15.3m. The second half should be much better, although just how good it will be will depend on trading in September and October and high operational gearing means that additional revenues will lead to a much bigger jump in profit.
Neometals (NMT) is lowering annualised overheads by two-fifths and the $3m at 4.5 cents/share raised from William Robert Richmond should last until the end of 2025. The focus will be the Primobius recycling operations. Net cash will be $9.3m and this will finance the company’s lithium-ion battery recycling business to the industrial validation stage. The Previous Metals Recovery option will not be taken up. Third-party funding is being sought for new lithium and vanadium technologies.
Touchstone Exploration (TXP) has declared the terms of its bid for fellow Trinidad-focused oil and gas producer Trinity Exploration and Production (TRIN) are final and says that it has irrevocable acceptances of 38.9% of the share capital. These irrevocable acceptances are obliged to vote against the rival, higher bid from Lease Operators.
Empire Metals (EEE) has identified a new deposit at the Pitfield project in Western Australia that adds to the value of the project. It is enriched with high-purity anatase formed from the weathering of the original titanite-rich, bedded sediments. The discovery also confirms high grades of titanium dioxide with very low impurities. Anatase is a feedstock for titanium chloride and titanium metal markets. Empire Metals continues to progress towards a maiden mineral resource estimate.
Nigeria-focused gold producer Thor Explorations (THX) sold 23,600 ounces of gold at an average price of $2,309/ounce in the second quarter. AISC was $802/ounce because of higher grade ore and guidance for the full year has been reduced to $900-$1,000/ounce. Quarterly revenues were $54m and EBITDA $38m. Net debt has fallen to $2.7m.
Electric hybrid systems developer Proton Motor Power Systems (PPS) says that its principal lender and major shareholder Falih Nahab will stop providing working capital at the end of 2024. At the end of July 2024, Proton Motor Power Systems has drawn down €110.4m out of debt facilities of €121.5m, plus it owes €37.8m in accrued interest. The facilities are repayable by the end of 2025, but the business is unlikely to be cash generative by then. There are talks with other potential providers of finance. Net liabilities were €111.7m at the end of 2023.
Recruitment software developer Dillistone Group (DSG) has raised £300,000 from a loan note issue from directors and £60,000 from a placing at 8p/share. Interim figures will show an improvement in profitability and cash generation. Markets continue to be weak, and the cash will provide a buffer for the business. The loan notes last 48 months and offer an annual interest rate of 9.85%. The conversion price is 14p/share.
MAIN MARKET
Packaging manufacturer and distributor Macfarlane Group (MACF) reported an 8% decline in interim revenues to £129.6m. Pre-tax profit was 3% lower at £11.6m. There was price deflation in the distribution business. Acquisitions increased manufacturing revenues but there was small decrease in profit contribution.
BATM Advanced Communications (BVC) reported flat interim revenues due to lower revenues from networking technology, but the outlook is more positive. In the six months to June 2024, revenues dipped from $60.2m to $60m, while pre-tax profit improved from $726,000 to $788,000. This was helped by the revaluation of a liability that reduced the total costs of the business in the period. Net cash was $27.2m at the end of June 2024, even though there was an increase in working capital. Cyber and diagnostics revenues grew, while networking revenues fell from $11.6m to $6m. New orders are being won in the networking division and there should be an improved second half.
MOH Nippon (MOH) was readmitted to the Main Market following the acquisition of its business by cash shell Bowen Fintech. The business provides crowdfunding services for real estate investment in Japan.
Andrew Hore
Quoted Micro 5 August 2024
AQUIS STOCK EXCHANGE
Marula Mining (MARU) has entered into a manganese ore supply agreement with Kitman, a local processing company in Kenya. The deal lasts until the end of 2026. Kitman will supply a minimum of 10,000 tonnes/month of manganese ore at 20% grade minimum to the Kilifi manganese processing plant. There will be an advance payment for 5,000 tonnes. A mining permit has been issued for Blesberg lithium and tantalum mine.
In the year to March 2024, business assurance provider Adsure Services (ADS) increased revenues from £8.99m to £9.3m, while pre-tax profit was 72% higher at £471,000. There was cash of £1.07m at the end of March 2024.
Ormonde Mining (ORM) investee company TRU Precious Metals has signed an option agreement with Eldorado Gold so that it can earn 80% of the Golden Rose project in Newfoundland. The 36.2%-owned TRU Precious Metals has persuaded Eldorado Gold to invest in the early-stage project.
Valerium (VLRM) will collaborate with Tokeny as a technology provider for Valerium’s Real World Asset (RWA) marketplace. The technology will enable the primary issuance and bulletin board-based secondary trading of various digital assets.
KR1 (KR1) had net assets of 82.01p/share at the end of June 2024. Income earned during the month was £877,000. One-quarter of the value of the portfolio is in Celestia tokens.
Hydrogen Future Industries (HFI) has secured a technology and territory licensing agreement worth up to €2.25m. The wind-based hydrogen production technology company has signed the deal with a new company in the Republic of Ireland.
Emission reduction fuel additives developer SulNOx Group (SNOX) says first quarter revenues were 134% ahead at £192,000. There were record product sales in the quarter. There was £1.6m in the bank at the end of June 2024.
RentGuarantor (RGG) increased interim revenues by 70% to £518,000, but the loss increased from £408,000 to £452,000 due to the hiring of staff. Net debt is £1.07m.
Cooks Coffee Company (COOK) has raised £320,000 at 7.85p/share. Chief executive Aiden Keegan has joined the board.
Supernova Digital Assets (SOL) had net assets of £5.49m at the end of April 2024, following an increase in the value of its cryptocurrency assets. There is £209,000 in cash.
AIM
Trinidad-based oil and gas producer Trinity Exploration and Production (TRIN) is recommending a cash bid from Trinidad incorporated Lease Operators and withdrawn the recommendation of the Touchstone Exploration (TXP) offer of 1.5 shares for each of the oil company’s shares. The bid is 68.05p/share and values Trinity Exploration and Production at £26.4m. There will be economies of scale between the two oil producers.
Touchstone Exploration (TXP) achieved net sales of 5,432 barrels of oil equivalent/day in the second quarter of 2024. Current average production was 5,711 boe/day with production improving at Cascadura.
Haleon has announced that it will launch the Futura Medical (FUM) erectile dysfunction topical gel treatment Eroxon in the US before the end of 2024. This will trigger the US launch milestone. The US is a bigger potential market than all the other sales regions combined. So far, Eroxon has been launched in Belgium and the UK with more to follow.
In the year to April 2024, SDI Group (SDI) revenues dipped from £67.6m to £65.8m, but there was underlying growth if the previous year’s Covid-related revenues are excluded. The scientific instruments manufacturer’s operating margins are just above 14%. Pre-tax profit dipped from £11.8m to £8m because of the higher margin business in the previous year. Management says there are potential acquisitions in progress, but the timing is always difficult to predict. Net debt was £13.2m at the end of April 2024 and that could halve in a year’s time without any acquisitions. Cavendish forecasts 2024-25 pre-tax profit of £8.4m and earnings of 6p/share are forecast.
North Sea-focused Jersey Oil and Gas (JOG) could be hampered by the rise in the energy profits level to 38% and the main investment allowance of 29% will be removed from November. A reduction in capital allowances will be announced in the October Budget. The levy will be extended until 2030. The Great Buchan Area joint venture will be impacted. Jersey Oil and Gas has a full carry on much of the development spending of the project and there are potential milestone payments. However, the final investment decision could be hampered by the tax changes.
RBG Holdings (RBGP) is expecting interim revenues of £18.4m, down from £19.8m. Net debt was £24.4m at the end of June 2024 and the debt facility is fully drawn. Costs are being reduced, but most will come through next year. A pre-tax profit of £1.2m is forecast for 2024 after the previous year’s loss.
UK Oil and Gas (UKOG) is the highest riser for the second week. its Dorset and Yorkshire underground hydrogen storage projects have received a letter of support from RWE, which is developing three hydrogen plants near to the storage projects. Other letters of support have come from Japanese trading house Sumitomo and pipeline provider SGN. The projects are at an early engineering design stage.
Oil and gas producer Arrow Exploration (AXL) says that the second horizontal well on the 50%-owned Carrizales Norte field in Colombia is producing ahead of expectations. The two wells are boosting group production. There is cash of $11m and should be at a similar level at the end of 2024 as cash generated from production helps to finance further drilling. Zeus has a total risked NAV estimate of 48.8p/share.
Online gaming company Gaming Realms (GMR) expects interim revenues to be m18% ahead at £13.5m and EBITDA should be 21% higher at £5.8m. Adding new partners has boosted income. Gaming Realms is on course to increase full year pre-tax profit from £5.4m to £8.8m. Net cash could double to £14m.
IQE (IQE) plans to float its Taiwan subsidiary on its local stock exchange.
Vector Capital (VCAP) plans to leave AIM and is offering shareholders the chance to tender shares at 33p each. The tender offer covers up to 11.2 million shares and will cost £3.7m. Interim pre-tax profit dipped 45% to £707,000. Vector Holdings owns 75.2% of the property finance provider
MAIN MARKET
Cybersecurity company Narf Industries (NARF) has admitted it requires additional funding to take advantage of its IP that has been developed as part of consultancy contracts. In the 15 months to March 2024, revenues were $7.6m, which was treble the level for the previous twelve months. These revenues come from consulting work. The reported loss was $1.44m, although that includes a share-based payment cost of £1.02m. There was a cash inflow from operating activities of $173,000. The chief executive has increased the facility made available to the company from $2m to $2.5m and this lasts until July 2025. At the end of March 2024, there was $1.55m drawn down.
Guild Esports (GILD) is exploring options that will enable it to meet short-term liabilities. That could be new credit terms, a fundraising or further cost savings. Management is also assessing the strategic direction of the company and that could lead to assets being sold. A partnership deal has been secured with AIM-quoted Inspecs (SPEC) for the marketing of the eyewear company’s REGEN glasses.
Andrew Hore
Quoted Micro 6 May 2024
AQUIS STOCK EXCHANGE
Good Life Plus (GDLF) has traded strongly since joining Aquis and raising cash for marketing. The luxury prize draw company increased the number of subscribers from 21,000 at the end of 2023 to 30,000. Churn has been reduced.
Invinity Energy Systems (IES) raised £56m at 23p/share with £25m committed by the UK Infrastructure Bank and £3m from Korean Investment Partners. There is also an open offer to raise up to £6.6m. The share price slipped 6.12% to 23p. IES will use £30m to increase capacity ahead of the launch of the latest version of the Mistral flow battery.
KR1 (KR1) gained shareholder approval for the market acquisition of up to 14.99% of its shares. NAV was 132.05p/share at the end of March 2024, down from 134.6p/share one month earlier. There was £1.96m in income from digital assets during the month.
Apollon Formularies (APOL) has sent a general meeting notice for 28 May to gain approval of the cancelation of the Aquis quotation. The company is selling its IP to a Canadian company.
Rogue Baron (SHNJ) has acquired Eight Vodka for £70,000 in shares at 0.5p each. Eight Vodka is distilled eight times in Ecuador.
Trading in Silverwood Brands (SLWD) was restored following the completion of a capital reduction. Phoenix Asset Management increased its stake from 0.94% to 29.9%. In the first quarter a rebranding of Balmonds has disrupted sales. The costs of acquiring Cosme Science hit profitability of Sonotas.
One Health Group (OHGR) says it did better than expected last year with annual revenues improving from £20.5m to £23m. Net cash was £4.7m at the end of March 2024. There was a 13% increase in NHS patient referrals for treatments. New five-year contracts have been secured with the two largest customers.
RentGuarantor Holdings (RGG) says first quarter revenues were 62% ahead and the number of tenant contracts was 38% higher.
Investment company MaxRets Ventures (MAX) reported net assets of £19,000 at the end of October 2023, down from £497,000. There was no new investment during the year. A transformative acquisition is being sought.
Hydrogen Future Industries (HFI) more than halved the interim cash outflow from operating activities to £234,000. Ther was £263,000 in the bank at the end of January 2024, but £612,000 has been raised since then. Testing of the prototype wind turbine and the electrolyser has gone well.
Substrate AI (SAI) generated revenues of $8.6m in 2023. There was $4.42m in the bank.
Hacienda Management has taken a 7.48% stake in Supernova Digital Assets (SOL). Pete Mills increased his stake in Oscillate (MUSH) from 3.02% to 4.03%. DXS International (DXSP) chairman Robert Sutcliffe bought 100,000 shares at 1.46p/share.
AIM
Trinity Exploration & Production (TRIN) has agreed a bid from fellow AIM-quoted Trinidad oil and gas company Touchstone Exploration (TXP), which is offering 1.5 shares for every Trinity share. The Trinity shareholders will own one-fifth of the enlarged company. The combined group will be in a stronger position to make investments in new production. The Touchstone Exploration share price is 4.85% lower at 39.25p, valuing each Trinity share at 58.875p – the share price is 50% higher at 54p.
Alpha Financial Markets Consulting (AFM) has confirmed that BridgePoint Advisers has made a bid approach and Cinven is considering making a bid. Revolution Bars Group (RBG) has received interest from Nightcap (NGHT), which is assessing the situation and options include a bid or acquisition of some sites or subsidiaries.
Electric Guitar (ELEG) moved from the standard list to AIM following the reverse takeover of 3radical on 3 May. It is the first in a planned series of acquisitions in the digital marketing sector, where regulatory and market changes, such as the blocking of third-party cookies, provide significant growth opportunities. 3radical was acquired for 61.2 million shares valued at £1.28m. A fundraising generated £1.32m at 2.1p/share and that valued the company at £4.7m. 3radical was set up by the founders of campaign management software provider Alterian at the end of 2011 The shares had been suspended at 2.1p and they fell to 1.8p when trading recommenced on AIM.
Multi-channel retailer TheWorks.co.uk (WRKS) moved from a premium listing to AIM. The board felt the company was too small for the cost and regulatory burden of the Main Market. One of the attractions of AIM is that the company will no longer be classified as a Public Interest Entity and it will be able to choose an auditor from a wider range of firms. Singer forecasts a slump in pre-tax profit from £10.1m to £1m in the year to April 2024.
Cornish Metals (CUSN) has published a preliminary economic assessment of the South Crofty tin project in Cornwall. There is an after-tax NPV8 of $201m at a tin price of $31,000 /tonne. Pre-production capital requirement is $177m, which is higher than previous estimates, and there should be 14-year mine life. Life of mine all in sustaining cost is estimated at $13,661/tonne. Planned first production is in 2027.
Horizonte Minerals (HZM) has enough cash until 17 May and senior lenders have agreed to extend waivers on loans, including deferring interest payments, until 15 May. These lenders have security over the company’s assets. Horizonte Minerals has guaranteed the debt of the subsidiary that owns the Araguaia project. Discussions with creditors and investors continue in an attempt to achieve some recovery value for creditors. That may include the disposal of the Araguaia project. None of the proposals are likely to recover value for shareholders.
Arrow Exploration (AXL) grew average production from 1.3mboe/day in 2022 to 2.2mboe/day in 2023 and revenues increased from $28.1m to $50.6m, which was slightly lower than forecast. There was cash of $13m at the end of 2023 and this fell to $12m at the end of March 2024. Production has reached 2.9mboe/day in March, while drilling activity will lead to further increases in the medium-term. Canaccord Genuity has cut its 2024 revenues forecast from $103.9m to $98.6m and net cash is expected to be $17m at the end of 2024.
Trading at property services provider Kinovo (KINO) is ahead of expectations with organic growth of 23% in the year to March 2024. Underlying pre-tax profit should be more than £6m, excluding costs related to the DCB contracts, which were guaranteed by Kinovo when it was sold, still to be completed.
Mark Halpin has stepped down as chief executive of managed IT services provider CloudCoCo (CLCO) and MXC Guernsey, which holds a 10.6% stake, has extended its loan notes to 31 August 2026 in return for a £550,000 fee. The amount outstanding on the loan notes is £5.85m. MXC can also appoint an executive director and Ian Smith becomes interim chief executive. The shares returned from suspension following the release of figures for the year to September 2023 showing revenues 7% ahead at £26m. The loss was flat at £2.6m. There was a cash inflow from operating activities. Net debt was £6.3m at the end of September 2023.
Brake discs developer Surface Transforms (SCE) raised £6.5m fundraising at 1p/share. There will be a one-for 1.76036319 open offer at the same price. That could raise £2m. The cash will finance the scale up of manufacturing. Factory capacity will be increased to £75m. This year’s revenues are forecast to be £17.5m.
Gift wrap and stationery supplier IG Design (IGR) did better than expected in the year to March 2024 with margins recovering and pre-tax profit improving from $9.2m to $25.9m, compared with a forecast of $20.5m, even though revenues fell. Net cash nearly doubled to $95m. It appears the recovery is gathering pace. Management believes that margins could return to previous levels this year and an operating margin of more than 6% in 2026-27, suggesting a pre-tax profit of around $50m.
IT distributor Northamber (NAR) is acquiring Tempura Technology and Tempura Communications, which distribute unified communications products, for £6.02m in cash and 181,818 shares. There is £2.64m of the cash consideration contingent on EBITDA in the years ending June 2025, 2026 and 2027. This is a profitable business that has been growing organically.
Heavy mineral sands project developer Kazera Global (KZG) says recent changes at the National Nuclear Regulator in South Africa mean that it will have to provide additional information on how it will meet financial obligations. This should be funded by cash flow. A response is expected shortly and that will allow heavy mineral sands production to start in Alexander Bay, South Africa.
Oil and gas producer Jadestone Energy (JSE) reported a $91.3m loss for 2023 due to asset impairments, lower oil prices and higher interest costs. Capital investment has increased net debt to $110.5m by the end of March 2024. Average production in the first quarter of 2024 was 17,200 boe/day, which was hit by the Australian cyclone season. Production guidance for 2024 is 20,000-22,000 boe/day.
MAIN MARKET
Castings (CGS) did better than expected in the year to March 2024 and Canaccord Genuity upgraded its pre-tax profit forecast from £27.1m to £28.2m. Margins improved in the second half. Net cash is £32m.
Cybersecurity firm Narf Industries (NARF) is accelerating work on capabilities uniquely effective in battling a new generation threat. Developed was funded through a $2.3m contract from DARPA.
Andrew Hore
Quoted Micro 30 May 2022
AQUIS STOCK EXCHANGE
Silverwood Brands (SLWD) has secured a deal to buy Balmonds Skincare, which manufactures products for people with skin conditions, such as eczema, psoriasis and dermatitis. The total cost of the acquisition will be up to £8m, all in shares, depending on achievement of performance criteria. A shareholder loan will also be acquired by Silverwood Brands for 1.4 million shares. Last year, Balmonds Skincare revenues were £1.41m and the loss was £297,000 after an R&D tax credit of £35,000. The current manufacturing facility could quadruple capacity, although it would require additional storage facilities.
Arbuthnot Banking (ARBB) maintained assets under management at £1.35bn at the end of April 2022, while loan balances were 3% higher than the end of 2021 at £2.06bn. Interest rate rises will improve income.
CBD products supplier and diagnostics testing company Goodbody Health Inc (GDBY) increased first quarter revenues by 276% to £5.2m, although it was still loss making due to foreign exchange movements. Net cash was £5.5m at the end of March 2022. A small profit is still expected for the full year, although that is a sharp downgrade from previous expectations as Covid testing levels reduce.
St Marks Homes (SMAP) made another loss last year. In 2021, revenues increased from £216,000 to £259,000 and the loss reduced from £170,000 to £106,000 even though there was a loss from joint ventures. Cash in the bank fell from £709,000 to £131,000. Net assets are £5.23m and the shares are trading at a discount to this figure.
Hydrogen Future Industries (HFI) subsidiary company HFI Energy Systems has advanced a wind-based hydrogen production system combined with electrolyser technology. The aim is to generate hydrogen at $2/kilo, which is a lower cost than existing technologies. The hydrogen can be generated from waste water or saline. The group intends to invest $1m on development and it will own 51% of an IP developed with the rest owned by inventor Timothy Blake.
British Honey Company (BHC) has terminated its joint venture with Tusmore Park Farms, which was going to set up a new whisky distillery. British Honey will get back £450,000 of its original £750,000 investment.
Watchstone Group (WTG) still had £13m in the bank at the end of 2021. That was after a £3.67m cash outflow from operations. Net asset are 29p a share. There is a £63m plus interest and costs claim against PwC and another claim against former auditor KPMG. Watchstone is appealing against a recent VAT decision by the courts in favour of HMRC.
Eight Capital Partners (ECP) is satisfying a loan of €5m via the issued of the same amount of 7% fixed rate bonds, which are traded in Vienna and mature on 26 July 2022. Major shareholder IWEP will be converting its €20m of loans into shares. There could be a fundraising after this happens.
Evrima (EVA) has decided to maintain its interest in Kalahari Key and not accept the Power Metal Resources (POW) offer, which means that the latter could own 87.7%. Kalahari Key owns the Molopo Farms complex project, which has nickel, copper and platinum group metals deposits.
Shareholders of Lekoil Ltd (LEK) have voted in favour of the appointment of Bright Grahame Murray as auditor and to authorise the directors to set the remuneration.
Altona Rare Earths (ANR) has adjourned a general meeting that was seeking shareholder approval to reprice warrants exercisable at 20p a share. The new plan is to offer to swap them for warrants exercisable exercisable at 12p a share.
AIM
EnSilica (LON: ENSI) raised £6m at 50p a share when it joined aim on 24 May. The share price ended the week at 50.5p. EnSilica designs application specific integrated circuits (ASICs), which are in increasing demand in areas, such as Internet of Things, satellite communications, wearable health devices and 5G. EnSilica has successfully managed the current shortage in semiconductors because it has managed to pass on price rises. The cash raised will help to fund growth and could finance suitable acquisitions and the quotation will raise the profile of the company. The ASICs market is expected to be worth $27.6bn in 2026.
Scientifics instruments manufacturer Judges Scientific (JDG) is making its largest ever acquisition, which is expected to be sharply earnings enhancing. Judges Scientific is paying an initial £45m in cash for Geotek, a developer and manufacturer of instruments used to measure and log characteristics of geological cores and related services. There could be further payments of up to £35m (50% cash and 50% shares). A minimum operating profit of £6.4m needs to be achieved in 2022 to spark any payment. The maximum payment will be made if operating profit of £11.4m is achieved. WH Ireland believes that the deal will enhance earnings by 17% this year – with a 7-month contribution from Geotek – and by 30% next year. Pre-tax profit is set to improve from £18.1m to £22.4m in 2022, and then rise further to £25.5m in 2023.
The FDA has given approval for the Parsortix liquid biopsy test developed by ANGLE (AGL) for its use with metastatic breast cancer patients. Parsortix is the first system that harvests circulating cancer cells from a blood sample for analysis that has been approved. By obtaining the approval for breast cancer diagnostics, this provides a route map for gaining approvals for other cancers.
Credit hire and legal services company Anexo Group (ANX) could receive a significant income boost after the out of court settlement by VW because of its manipulation of air pollution tests. VW has agreed to pay £193m plus costs to more than 91,000 claimants in England and Wales. That is just over £2,000 each. This is a separate case to that being put forward by Anexo for its 13,000 claimants, although a similar settlement can be anticipated. House broker Arden Partners believes that the company will receive 50% of the compensation plus legal costs. Both Arden and WH Ireland are suggesting a pre-tax profit contribution of £20m-£25m after some additional costs. The timing of this is uncertain. Net debt is expected to be more than £70m by the end of this year, some of which is litigation funding related to the VW cases, and that would be much lower if the VW cash is received.
Demand for vehicles and equipment from television programmes and films means that Facilities by ADF (ADF) is benefitting from high utilisation rates. There were 39 productions serviced in 2021. TV series tend to book well ahead of the start of production, so visibility is good for the current year. The company is already investing in new trailers, although there could be delays in their arrival. Utilisation rates are expected to be around 85% this year.
Floorcoverings distributor Likewise (LIKE) reported full year figures in line with previous indications and it continues to gain market share. Acquisitions and organic growth in double digits are expected to enable Likewise to grow revenues from £60.5m to £114.9m in 2022, while underlying pre-tax profit is forecast to jump from £1.6m to £4.2m. New distribution capacity has been added and a distribution centre is on course to open in the first quarter of 2023.
Pennant International (PEN) continued to lose money in 2021, but the software and training company is already on course for a return to profit this year. Recurring revenues are running at £9m a year, helped by additional software contracts. The total order book is worth more than £32m with more potential orders in the pipeline. WH Ireland forecasts a 2022 pre-tax profit of £600,000 with most of the expected revenues of £17m covered by the order book.
Belvoir Group (BLV) has acquired TIME Group, another appointed representative of the Mortgage Advice Bureau predominantly based in northern England and the Midlands for an initial £3.7m. This is earnings enhancing. In the year to July 2021, TIME generated revenues of £4.2m and pre-tax profit of £600,000. Belvoir revenues are in the line with expectations in the four months to April 2022. Higher lettings income offset a decline in property sales income.
MTI Wireless Edge (MWE) First quarter revenues were 12% ahead at $11.2m, helped by a strong performance by the distribution business and a contribution from recent acquisition PSK Wind Technologies. There was a 3% decline in antenna revenues because customers could not get their hands on other components. The orders are there for antenna, particularly for 5G. The acquisition and dividends led to a fall in net cash to $6.5m, but it should improve by the end of 2022.
Tortilla Mexican Grill (MEX) is acquiring rival fast-casual Mexican restaurants operator Chilango. Investment firm RDCP currently owns Chilango. Tortilla Mexican Grill will pay up to £2.75m for the restaurant chain. In 2021, Chilango generated revenues of £7.3m and made a small loss. Chilango has eight sites in the London and Manchester.
Medical imaging technology provider IXICO (LON: IXI) reported interim revenues fell from £4.9m to £3.9m. That was not a surprise because it was flagged that there would be a decline this year, which was exacerbated by the early closing of a study. Pre-tax profit fell from £635,000 to £201,000. The order book was worth £12.6m at the end of March 2022, including £3.8m secured in the period. At least one more contract has been added since then.
Trinidad-focused Trinity Exploration and Production (TRIN) revenues improved from £44.1m to £66.3m in 2021 even though oil and gas production was lower. A new drilling programme will start in the second half of 2022, and this will help to increase production. A deeper appraisal well, with an estimated probability of success of 55%, could substantially increase reserves.
Purplebricks (PURP) has admitted that it made a higher than expected loss in the year to April 2022. There was still £43.2m in the bank.
MAIN MARKET
Motor vehicle lender S and U (SUS) is trading ahead of expectations. Group net receivables have increased by more than 5% since the beginning of the financial year. The fastest growth was at property lender Aspen where net receivables were 12.5% higher. The much larger Advantage car lending business grew its receivables by 3.5%, while credit quality has been maintained. Defaults remain low. The forecast yield is 5.8%.
Associated British Engineering (ASBE) kept its overheads to a minimum in the six months to March 2022 and still had £470,000 in cash and available for sale financial assets of £154,000. Net assets are £610,000, which is double the current market capitalisation.
Publisher National World (NWOR) says revenues are 4% ahead so far this year, although the rate of growth has slowed. Digital revenues are 38% higher year on year, while print revenues have declined due to lower circulation.
Zotefoams (ZTF) has made a good start to the year with revenues 13% ahead. Prices have been increased to offset higher costs. Polyolefin foams sales were 20% ahead with 5% relating to volume increases. Full year pre-tax profit could recover from £7.2m to £8.7m this year with a much bigger improvement expected next year.
Andrew Hore
Andrew Hore – Quoted Micro 10 May 2021
AQUIS STOCK EXCHANGE
Virgata has published its offer document for the 50p a share bid for Walls & Futures REIT (WAFR) and the first acceptance date is 27 May. Walls & Future REIT management are still arguing that the bid is too low because it is at less than 50% of NAV. Virgata points out that shareholders would not be able to sell their shares in the market for anywhere near NAV and that costs, including director pay, exceed income. Liquidity is certainly and that means that it has been difficult to raise cash to scale up the business.
Samarkand (SMK) is making its first acquisition following its admission to the Aquis Apex segment. The cross-border trading group is paying £2.41m in cash and shares (at 139.67p each) for Zita West Products and 51% of Babawest, where a further £400,000 will be loaned. Zita West Products supplies nutritional supplements for fertility and pregnancy, and it has worked with Samarkand for more than three years. Babawest supplies nutritional products for mothers and babies. In the year to September 2020, Zita West Products made an adjusted pre-tax profit of £241,000 on revenues of £854,000. Interim revenues were 60% ahead at £636,000. Samarkand can use its ecommerce technology and contacts in China to grow sales.
Third quarter revenues dipped at National Milk Records (NMRP), but like-for-like revenues were 1% greater at £5.42m. That excludes the former heat detection operations. The growth has come from newer areas, such as Johne’s and surveillance testing. There was a small decline in milk recording revenues, but they are recovering and the next quarter comparisons will not be as strong.
British Virgin Islands-based technology-focused shell Boanerges Ltd plans to float on 17 May. It appears that the share issue will be relatively small because Richard Griffiths will have his stake diluted from 75% to 71.7%. Internet of Things, big data and telematics are some of the areas where the directors are seeking acquisitions.
Rutherford Health (RUTH) is drawing down £15m from its infrastructure investment facility, which means that all £40m will have been drawn down. This will be invested in the company’s cancer treatment facilities.
Sativa Wellness (SWEL) increased 2020 revenues by 38% to £1.99m. Transaction costs increased the loss from £3.8m to £4.8m. There are 30 wellness clinics in operation, and they are adding to the range of tests on top of the Covid-19 tests. The benefits of CBD products launched last year should show through in 2021.
URA Holdings has distributed its shares in Ananda Developments (ANA) to its own shareholders. This has increased the stakes of directors Charles Morgan (to 8.65%), Melissa Sturgess (to 13.2%) and Peter Redmond (to 1.47%).
Western Selection (WESP) has increased its stake in electrical and gas services provider Bilby (BILB) from 11.93% to 12.18%. This was before the trading statement that revealed that Bilby generated 2020-21 revenues of £60m and EBITDA of £3m. Net debt was £2.7m at the end of March 2021, prior to commencing paying £1m of VAT liabilities. The full yar results will be published in early July.
Christopher Potts has taken a 5.94% stake in DiscovOre (ORE).
Newbury Racecourse (NYR) non-executive director Bryan Burrough has acquired 8,600 shares at 737.5p each.
S-Ventures (SVEN) has raised £3m at 15p a share and every two shares will be issued a warrant exercisable at 25p. Chief executive Scott Livingston invested £500,000 in the placing and his stake is 49.1%. Vulcan Industries (VULC) has raised nearly £75,000 at 3.2p a share.
AIM
Virgin Wines (VINO) says that sales and profit are ahead of expectations in the year to June 2021. Liberum had forecast revenues of £70.3m, up from £56.5m last year, and the outcome is expected to be at least £73m. The easing of lockdowns could hamper growth, but the expanded customer base will help Virgin to continue to grow.
Bars operator Nightcap (NGHT) is making its first acquisition since joining AIM. Nightcap is paying £2.5m for Adventure Bars Group with £1m in shares being paid initially and up to £1.5m (at the same share price) dependent on performance in the two years from 1 July 2021. The cost is much higher than that because the acquisition comes with around £4.3m of borrowings, of which between £1.28m and £1.78m will be repaid and a £110,000 convertible (at 21p a share) issued to the lender. Nightcap is trying to raise a further £4m.
IPTV technology developer Mirada (MIRA) says trading was in line with expectations in the year to March 2020. That means that revenues were around £12m and the loss was around £3m. Trading improved during the second half and revenues were higher than in the first half. New opportunities mean that Mirada should improve its performance this year. Demand is building up in Asia.
A positive trading statement by concrete levelling equipment supplier Somero Enterprises (SOM) has led to a 15% upgrade in forecasts earnings to 39.9 cents a share. That has led to an increase in the expected dividend to 27.9 cents a share. Trading has been strong in the US, while Europe and Australia are recovering.
Coral Products (CRU) is paying an interim dividend 0.5p a share and the ex-dividend date is 13 May. Coral is selling the Haydock facility for £3.5m, but has to spend £650,000 on the roof before the sale is completed. Book value is £2.5m. Coral will lose the £300,000 a year of rental income.
Appreciate Group (APP) says 2020-21 figures are in line with expectations. Even so, the underlying pre-tax profit of the financial services and savings business has been slightly upgraded by Edison. The pre-tax profit is still likely to slump from £11.4m to £4.5m, before recovering to £7.2m in 2021-22. Digital sales are becoming increasingly important.
Trinity Exploration and Production (TRIN) has acquired a 100% interest in the PS-4 lease block, onshore Trinidad, for $3.5m. Average daily production was 83 barrels during 2020.
Software company WANdisco (WAND) increased its loss in 2020-21, but it is expected to fall sharply this year. That is because revenues are forecast to jump from $10.5m to $37m. WANdisco could even move into profit next year. The LIVEdata software is thought to be the only credible petabyte data analysis product capable of migrating data to the cloud on the market.
One Media IP Group (OMIP) has acquired the writer’s share of producer royalties, which covers more than 250 tracks by Kid Creole and the Coconuts. This deal has been done through Harmony IP, which gives artists the chance to access future income by selling a portion of their rights. This high profile deal could attract other artists to the Harmony IP proposition.
Initial drilling results from the Hamersley iron project owned by Alien Metals (UFO) shows new iron ore zone targets in the Hancock area of the project. The interpretation work outlines much larger target areas. Results from 36 more drill holes are due later this month.
Bacanora Lithium (BCN) says that there has been a 67.5p a share cash bid approach from Ganfeng International Trading. The bid is near to the share price high at the beginning of the year, which was the highest it has been for nearly three years. Ganfeng owns 50% of the Sonora lithium project and already holds 28.9% of Bacanora.
Anglo African Oil & Gas (AAOG) has lost its AIM quotation because it has failed to acquire a new business. It has entered into an option to acquire a 25% interest in the Saltfleetby gas field in east Lincolnshire for £8m in shares. The deal is dependent on at least £1m being raised and the shares becoming quoted on a recognised market.
Nu-Oil and Gas (NUOG) has left AIM, but it continues to make progress with the acquisition of Guardian Maritime. The cash generative business sells a retro-fitted system for ships that stops pirates boarding vessels. This deal should enable the shares to be admitted to the standard list by the end of June.
MAIN MARKET
Standard list shell East Star Resources (EST) commenced trading on 4 May, and it is seeking resources opportunities. The shell raised £1.73m net of expenses at 5p a share. The existing shares were previously issued at 1p each. The share price ended the week at 6.25p.
Tirupati Graphite (TGR) has developed a graphene-aluminium composite. This has conductivity properties comparable to copper. Tirupati is talking with potential customers who would want to replace copper because of the composite’s lower weight. Power and propulsion systems are one area where there is interest.
Cardiff Property (CDFF) has increased the interim dividend from 4.8p a share to 5p a share. There was a dip in pre-tax profit from £387.000 to £365,000, but there was a lower tax charge. The Thames Valley property markets has shown signs of slowing down and rental income will be lower this year. The current share price is 1850p, compared with a NAV of 2445p a share – although there is a potential tax liability on any disposal of the investment in Campmoss of 265p a share.
MGC Pharmaceuticals (MXC) says pre-clinical and clinical results for ArtemiC Rescue, which targets viral infections with inflammatory complications, has demonstrated an ability to decrease the markers of inflammation. Phase II clinical trials showed that the treatment could hasten recovery in Covid-19 patients with mild to moderate illness, which should offset the problem of long Covid.
CBD products supplier Zoetic International (ZOE) is raising £6m at 60p each and this will be used to terminate the financing agreement with LDA Capital. That will cost £1.2m and the rest will go on the US rollout of Chill products and launching new products.
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 27 January 2020
NEX EXCHANGE
Results from IFA group AFH Financial (AFHP) indicate the success of the acquisition policy. In the year to October 2019, underlying pre-tax profit improved from £10.3m to £17m and earnings per share rose by more than two-fifths. The dividend was one-third higher at 8p a share. Assets under management were £6.2bn. AFH plans to grow to annual revenues of £140m and assets under management of £10bn in five years. Cash generated from operations was held back by the protection division predominantly generating non-indemnity business, where the payment is spread over the term of the package. Non-indemnity business will reduce in order to have a higher proportion of revenues that gets paid upfront. Cash generation will improve, and this will mainly go on deferred consideration.
Corporate adviser First Sentinel (FSEN) has raised £220,000 at 27p a share in order to provide working capital for the business. That was a small discount to the market price the day before the placing was announced, but the price fell to 19p/22p on the day. On the day, there were 25,000 shares traded at 20p each and 186,370 shares traded at 20.09p each.
NQ Minerals (NQMI) has appointed New York-based Ortoli Rosenstadt as the law firm to help it with a potential ADR listing in the US.
Broadband-focused shell SAPO (SAPO) has announced the death of its executive chairman Michael Meyer, who was the founder of Emess Lighting. He and his wife own 43.4% of SAPO. Michael Langoulant is the only remaining director of SAPO.
Eight Capital Partners (ECP) has placed an additional €90,000 of 7% July 2022 bonds, which are traded on the Vienna Stock Exchange. A total of €3.64m of bonds have been issued, which is 73% of the total that can be issued.
BWA Group (BWAP) has issued 3.26 million shares at 0.5p each to settle directors’ fees for the fourth quarter of 2019. The current share price is 0.2p/0.4p. Richard Battersby’s stake is 16%, Alex Borelli holds 9.48% and James Butterfield owns 15.8%.
Juliet Adelstein will become chief executive of Ganapati (GANP) on 1 February. She previously worked at Japanese advertising agency Dentsu. Hiroki Hasegawa and Toshitaka Nakajima are stepping down as chief executive and finance director respectively.
Via Developments (VIA1) 7% debenture stock 2020 has been withdrawn from MEX. Trading was suspended on 21 October 2019 because of a delay in appointing an independent non-executive director.
Former NEX-quoted company MESH Holdings still plans to acquire AI business Sentiance and Mike Power has taken over as chairman. MESH has also appointed two new directors. Corporate finance professional Lindsay Mair and Ireland-based former broker Rory O’Sullivan.
Last year was a tough one for agriculture and feed products supplier Wynnstay (WYN) and pre-tax profit fell from £9.5m to £7.9m, but the dividend was still raised. Profit is expected to be flat this year. There was net cash of £3.8m at the end of the year, as lower commodity prices reduced working capital requirements, but there will be £7m of lease liabilities included as debt in the next balance sheet. Seasonality means that there will be a net debt figure at the interim stage and the leases mean it will be much higher than it would have been. Net cash could still be £6m by the end of next October.
Concrete levelling equipment Somero Enterprises (SOM) had a better than expected fourth quarter and this led to an upgraded 2019 earnings forecast from 33.7 cents a share to 36.5 cents a share. That is still lower than 2018 and a further dip is expected in 2020 due to higher marketing spend. The expected total dividend for 2019 is 24.6 cents a share.
United Oil and Gas (UOG) says that the ASH-2 well that is part of the interests being acquired in Egypt has been producing more than 3,000 barrels of oil per day since the beginning of the year. United’s share is 660 barrels of oil per day. The acquisition of the Egypt interest from Rockhopper Exploration (RKH) will not be completed until February.
Nostra Terra Oil and Gas (NTOG) says a general meeting requisition is valid and it will announce a date for the meeting by next week. Eridge Capital wants to remove Matt Lofgran from the board and replace him with Andrew Morrison.
Regenerative medical products developer Tissue Regenix (TRX) says that revenues grew 12% last year, but the cash will not last much longer. There was £2.4m at the end of 2019 and this will last until the end of April. More funding will be required before then.
Peel Hunt has halved its dividend forecast for construction services provider Van Elle (VANL) to 1p a share, although it has maintained its 2019-20 pre-tax profit forecast at £4m. The interim dividend was cut by four-fifths to 0.2p a share. A sharp drop in interim profit means that two-thirds of the forecast needs to be made in the second half. Net debt was £10.4m at the end of October 2019.
IPTV technology company Mirada (MIRA) has completed the cancelation of the share premium account.
Gear4Music (G4M) had strong Christmas trading and gross margins improved. Revenues grew by 7% to the end of 2019 and gross profit was 18% ahead. Earnings of 3.9p a share are forecast for the 2019-20 financial year.
Agronomics (ANIC) has raised a further £5.5m at 7p a share. That is a one-third discount to the market price. At the end of last year £7.7m was raised at 5.5p a share. Agronomics has invested some of the cash it previously raised in cultivated meat businesses developing meat and fish that is produced without animals, but It will have £9.9m in the bank after the cash raising.
Cyber security software provider Kape Technologies (KAPE) generated slightly better 2019 margins than anticipated. EBITDA grew by 40% to $14.5m in 2019 and it will more than double this year.
Touchstone Exploration Inc (TXP) believes that the best possible outcome was achieved from the initial production tests of the Cascadura well in Trinidad, which appears to have oil and associated gas. The Coho-1 well should be in production by June.
Trinidad-based oil and gas producer Trinity Exploration and Production (TRIN) increased production by 5% in 2019 and exited the year with daily production of 3,400 barrels. The current forecast for 2020 is 3,260 barrels per day. There was cash of $13.8m at the end of 2019.
Fuel cells developer Proton Motor Power Systems (PPS) has received a €400,00 order from E-Trucks Europe for fuel cells for refuse collection trucks. They will be delivered by the end of 2020.
MAIN MARKET
Standard list shell Spinnaker Opportunities (SOP) still intends to acquire medicinal cannabis company Kanabo Research but there are still conditions to be satisfied. The deal was announced 11 months ago.
Contango Holdings (CGO) is another cash shell and it has been in the process of acquiring the Lubu coal project since April. A £1.4m placing at 5p a share puts Contango in a position to publish a circular for the acquisition.
Tex Holdings (TXH) says it has a record order book. It is responding to matters raised by the FCA and trading in the shares remains suspended. Trading was suspended nine months ago and it has reported its late annual figures, although there still appear to be doubts about the financial state of the company. The overdraft has been repaid.
Andrew Hore
Andrew Hore Quoted Micro 1 October 2018
NEX EXCHANGE
Brewer Shepherd Neame (SHEP) managed to edge up its profit despite flat turnover of £156.6m in the year to June 2018. Underlying pre-tax profit was 5% ahead at £11.8m. The total dividend is 3% higher at 29.2p a share. Growth came from the managed pubs but there was a decline in the brewing operations because of the loss of the Asahi contract. Own brand volumes were 0.9% lower, but the division improved its profit contribution. Volumes will continue to fall as third party business is further reduced. The current year has started well.
Chapel Down (CDGP) is opening a bar, restaurant and ginnery called the Chapel Down Gin Works in the Kings Cross area. The wines and beers maker reported a 15% rise in interim revenues to £5.72m. The majority of the growth in revenues came from the wine business and demand continues to exceed supply. The overall loss rose because of the much higher loss from the brewing business. Group profit is second half weighted.
V22 (V22) slipped into loss in the first half of 2018 as the NAV declined from 3.94p a share to 3.88p a share. If the art portfolio is revalued the NAV has increased from 7.47p a share to 8.29p a share.
Coinsilium Group Ltd (COIN) generated revenues of £1.33m in the six months to June 2018. There was a reported pre-tax profit of £554,000, after an impairment charge of £216,000. There was £65,000 of cash generated in the period. The blockchain consultancy and investment company obtained most of its revenues from token sales advisory business.
KR1 (KR1) made a loss of £7.36m in the six months to June 2018. That loss was due to unrealised losses on the carrying value of digital currencies and other investments because of the decline in prices during the period.
Property investor Ace Liberty and Stone (ALSP) increased its annul revenues by one-third to £3.52m, but pre-tax profit declined from £1.12m to £214,000. That was due to a lack of disposal gains and higher interest costs. Ace has acquired the Mecca Bingo Hall in Chesterfield for £3.999m and this generates an annual rent of £301,000.
A €5.34m gain on the acquisition of an investment property helped Black Sea Property (BSP) swing from a loss to a pre-tax profit of €5.11m. The NAV increased from 0.76 cents a share to 1.16 cents a share.
Health staff provider Healthperm Resources Ltd (HPR) nearly trebled its interim revenues to £297,000 as the number of candidates deployed jumped from 50 to 144. There are 158 people enrolled in the Middle East language training centre.
BWA (BWAP) continues to seek a reverse takeover candidate and its two investments are making progress. Prepaid cards provider Prepaid Global Services is making slower than expected progress but continues to plan to gain a quotation. BWA has applied for licences in Cameroon on behalf of investee company Mineralfields. BWA had £76,000 in the bank at the end of April 2018, while shareholder funds increased from £570,000 to £764,000.
Forbes Ventures (FOR) has appointed Igor Zjali as chief investment officer and Kirk Kashefi as a non-executive director. Nigel Quinton becomes permanent finance director. The £100,000 loan from Quanta Capital has been converted into 100 million shares. There was £56,000 in the bank at the end of June 2018. Investee company Civilised Bank has resubmitted its application for authorisation to the Prudential Regulation Authority.
Etaireia Investments (ETIP) engaged Bishop and Sewell to investigate transactions undertaken by former boss Baron Bloom. He failed to report that he received £6,230 of rent due to Etaireia from a tenant of the Ivy Leaf Club property. Bloom is owed outstanding salary and expenses, so no action is being taken by the company. Greg Collier has stepped down as a non-executive director.
Healthcare IT supplier DXS International (DXSP) swung from profit to loss in the year to April 2018, partly due to the interest charge. Revenues dipped from £3.43m to £3.41m. Investment in new products should help to build revenues.
Western Selection (WESP) increased its NAV from 95p to 96p. Improvements in the value of the stakes in Northbridge Industrial Services and Bilby, offset the reduction in the Swallowfield investment valuation. The total dividend has been increased from 2.2p a share to 2.25p a share. The shares are trading at a discount to NAV of around one-third.
Crossword Cybersecurity (CCS) increased its interim revenues by 37% to £544,000 and the loss was reduced from £1.24m to £824,000. There was £1.75m in the bank at the end of June 2018.
The NAV of EPE Special Opportunities (EL.P) fell by 19% to 190.2p a share over the six months to July 2018, due to a halving of the value of the investment in Luceco, where, in August, EPE invested a further £2m.
Wishbone Gold (WSBN) reported flat interim revenues of $3.91m, but the loss increased from $331,000 to $527,000. The revenues were generated from Thailand and Africa. The Honduras operation has been delayed but should be up and running by the end of the year.
Via Developments (VIA1) has raised a further £140,000 from a debenture stock issue.
Interim revenues declined from HK$7.22m to HK$5.27m at MiLOC Group Ltd (ML.P) and there was a significantly higher loss of HK$24.8m. The cash position was HK$7.65m at the end of June 2018. The traditional Chinese medicines supplier was hit by lower wholesale orders. Discussions continue with additional distributors.
AIM
Parasite control products developer TyraTech Inc (TYRU) has signed a conditional merger agreement with American Vanguard Corporation, which involves an offer to the other TyraTech shareholders of 3.15p a share. TyraTech needs cash to grow and 34.4% shareholder American Vanguard is in a stronger position to obtain the finance. TyraTech had cash of $3.7m at the end of June 2018.
Northbridge Industrial Services (NBI) is still losing money but the electrical and oil and gas tools markets are showing signs of improvement. A full year loss of £2m is still expected but the group could reach breakeven next year. Northbridge has the cash to invest in additional rental equipment.
Rose Petroleum (ROSE) reported a lower interim loss and it had net cash of $2m at the end of June 2018. Drilling of the first well on the company’s Paradox Basin acreage in Utah should start before the end of the year. A recent report suggested that there could be 13mmboe of 2C resource. There has been successful exploration in the area and it already has the appropriate infrastructure. If the appraisal well is a success that should provide a strong background for a further fundraising.
Keystone Law (KEYS) grew interim revenues by 30% to £19.9m thanks to strong recruitment of new lawyers. This progress means that Keystone is on target to improve full year pre-tax profit from £2.9m to £4.4m and a total dividend of 7.5p a share is expected.
NWF (NWF) says the warm summer has hit demand for heating oil and there has been increased competition in fuels. There has been increased demand for feed and the food distribution business is trading in line with expectations.
Health monitoring equipment supplier Deltex Medical (DEMG) is adapting its strategy in order to grow revenues and generate cash from existing customers. Costs are also being reduced. Probe revenues fell in the first half of 2018 due to delayed orders in the US and France. Overall, interim revenues fell from £2.88m to £2.33m, but the operating loss was only slightly higher at £1.14m. There is just over £1m in the bank.
Fishing Republic (FISH) has appointed Daniel Quinn as chief executive. He has previously worked at Go Outdoors and Tesco. That could point to a broadening of the range of products that will be sold by the fishing tackle retailer. Interim revenues fell from £4.1m to £3.4m, while the loss was £2.5m, which includes stock write downs and other one-off costs. Five outlets have been closed.
Trinity Exploration (TRIN) increased its oil and gas production in the first half and also achieved higher prices. The Trinidad-focused oil and gas producer increased interim revenues by 49% to $30.1m and generated $5m of cash from operating activities. There was net cash of $19m at the end of June 2018.
Gama Aviation (GMAA) increased interim revenues by 3% to $104.6m, with a lower contribution from the ground maintenance activities offset by higher revenues from the air services operations. A better second half should enable Gama to increase its full year pre-tax profit from $17.1m to $19.9m.
Oil and gas producer and explorer Cabot Energy (CAB) increased its interim revenues from $1.8m to $7.5m thanks to higher production in Canada, where Cabot took full control earlier this year. Even so, there was still a $4.2m first half loss, mainly due to exceptional costs, following the installing of a new management team. Management is in talks with potential farm-in partners for some of its Italian assets. That would enable Cabot to focus its investment in Canada. There was $6.2m in the bank at the end of June 2018, although some of that cash could be needed to complete the purchase of an Italian producing asset.
Immupharma (IMM) had £9m in the bank at the end of June 2018. The group is collaborating with Icanthera, which will in-licence the Nucant cancer programme, which has completed two phase 1 trials. Immupharma is also seeking to divest its subsidiary Ureka, while retaining an interest in the potential of the operations. Even though the results of the Lupuzor phase III trial were disappointing, a deal has been signed for Lupuzor to be provided via a Managed Access Programme. An open label extension study for Lupuzor will report by next summer.
Park Group (PKG) says that it has grown its cash balances and both the consumer and corporate businesses are trading well. Park is on course for a full year profit of £13.6m.
Active Energy (AEG) reported a higher interim loss. This was a period when $1.32m was spent on the development of the CoalSwitch plant. Along with its partner, Active has submitted an EU grant application for the SuperFuel coal slurry recovery technology and a decision should be made before the end of the year. There is also optimism about gaining a Crown Timber Licence for Newfoundland and Labrador.
Destiny Pharma (DEST) still has cash of £15.1m even though costs were increased in the first half. Investment in trials means that cash could fall to £10m by the end of the year. The phase I safety study for the use of XF-73 to prevent surgical infections should be completed by the end of this year and a phase IIb trial could commence early next year. A second formulation of XF-73 is being developed for dermal infections and diabetic foot ulcers in particular.
Midatech Pharma (MTPH) plans to sell its US subsidiary, which it acquired in 2015 when it gained its Nasdaq listing. Midatech will receive an initial $13m for the cancer care products supplier. The cash will be used for the research and development operations and paying off the loan from MidCap.
Bosch has invested £9m in fuel cell technology developer Ceres Power Holdings (CWR) in return for a 4.4% stake. Weichai Power will invest a further £1m to maintain its 10% stake.
There was a 17% fall in gold processed by Goldplat (GDP) in the year to June 2018, but sales only dipped from 40,285 ounces to 39,400 ounces. Revenues increased by 7% to £33.8m. The Kilimapesa gold mine continues to disappoint and lose money. A lower contribution from the Ghana processing operations and a bad debt were the main reasons behind the fall in pre-tax profit from £2.84m to £1.79m. Goldplat is seeking other mine investments, not necessarily in Africa. There was £1.54m in the bank.
Veltyco (VLTY) has managed to reduce its receivables but the were still €12.6m at the end of June 2018. Revenues for the previous six months were €8.9m. Net cash was €1m. Veltyco will launch its own financial trading brand in the fourth quarter.
Stride Gaming (STR) continues to be hit by the stagnation of the online bingo market but the decline in pre-tax profit is set to be in line with expectations. In the year to August 2019, pre-tax profit is expected to fall further from £14.2m to £13.8m. There will be a £4m provision for the recent fine from the UK gambling authorities.
Strategic Minerals (SML) reported a jump in interim pre-tax profit from $158,000 to $2.69m, but this did not come through in cash during the period. That is because £2.46m of the profit came from a gain based on the payment for the Leigh Creek copper mine below its asset value.
MAIN MARKET
Hemogenyx Pharma (HEMO) is moving towards the point where it can submit an IND application to the FDA for CDX antibodies. There is initial data that CDX antibodies can attack and eliminate Acute Myelogenous Leukemia in vitro. Hemogenyx already has an agreement with a global pharma company for this technology. Northland has been appointed as broker.
World Trade Systems (WTS) reported a drop in interim revenues from £10.1m to £6.3m and it has fallen into loss. Trading has been tough for the health food subsidiary. This is set to continue. Trading in the shares has been suspended for more than a decade and the board says that is working towards a resumption of trading on the premium segment of the Main Market.
WideCells Group (WDC) has gained financing of up to £2.7m from the European High Growth Opportunities Securitization Fund. The facility is convertible into shares and has warrants attached. The cash will be invested in the stem cell storage and insurance operations. The BabyCells stem cell storage service has been launched. Group revenues remain modest and WideCells made an interim loss of more than £2m. There was £1.73m in the bank at the end of June, offset by debt of £1.17m.
Investment company London Financial and Investment Group (LFI) has maintained its NAV at 65.4p a share, despite a decline in value of its stake in Finsbury Food (FIF), and the total dividend has been edged up to 1.15p a share. The share price is 42.5p.
Standard list shell Blockchain Worldwide (BLOC) still had £1.4m in the bank at the end of June 2018 following its decision to change its strategy from telecoms to blockchain acquisitions. Management is analysing potential acquisitions.
Andrew Hore
Andrew Hore – Quoted Micro 18 December 2017
NEX EXCHANGE
Wine and beer maker Chapel Down Group (CDGP) has raised £18.53m at 50p a share and could raise up to £1.47m more via a one-for-35 open offer at the same share price. The latest acceptance date is 5 January. Chapel Down will invest in an additional 500 acres of vineyard land and more money will be put into marketing. The family interests of Michael Spencer have invested in the fundraising. Nigel Wray has invested a further £500,000 but his stake has fallen to 16.5%, prior to the open offer. This year’s turnover is expected to be at least £11.6m and management expects growth to accelerate after the additional investment. New gin and vodka brands have been launched and the Ashford brewery should be up and running by the end of 2018.
Ashley House (ASH) has signed a joint venture with Morgan Sindall to develop extra care and supported living housing. This deal sparked a 55% increase in the share price to 14.75p. Morgan Sindall is paying £4m in total for the 50% stake in the joint venture, with £1.5m of this dependent on certain completion factors. It should all be paid by the end of 2018. The Ashley House housing division will complete two existing schemes and then own 50% of the joint venture, which will develop any further schemes. This additional cash will help to accelerate the growth of this part of the business. There is already a pipeline of potential developments. Ashley House will make an interim loss but expects to profitable for the full year.
e-commerce technology provider Netalogue Technologies (NTLP) reduced its interim loss as revenues grew from £317,000 to £479,000. There has been a lower number of larger projects, particularly in the food and drink sector, and Netalogue would have been profitable without the investment in the company’s technical team. A move towards a SaaS-based model could hold back short-term revenues.
AIM-quoted, spread betting business London Capital Group (LCG) has joined the NEX Exchange Growth Market on 15 December. Glio Holdings Ltd owns 78.1% of London Capital.
Early Equity (EEQP) has made two more investments. It has invested £60,000 in TruSpine Technologies Ltd, which plans to join AIM next year. TruSpine has developed the Faci-LOK and Cervi-FAS minimally invasive spine stabilisation devices and the VOSC catheter atherosclerosis treatment product. The plan is to gain FDA authorisation for Faci-LOK next year and then float. TruSpine is valued at £15m. A £35,000 investment in the profitable corporate finance and asset management business Farina Investments (UK) Ltd has been made ahead of a flotation. Early Equity raised £115,000 at 0.6p a share.
Hydro Hotel, Eastbourne (HYDP) has declared an unchanged total dividend of 21p a share for the year to October 2017.
Lombard Capital (LCAP) says that it is progressing towards the issue of an investment bond that will be quoted on a recognised bond market. There was nearly £60,000 in the bank at the end of September 2017.
Coinsilium Group Ltd (COIN) raised £720,000 at 9p a share and this will be used to invest in blockchain companies and expand the company’s own advisory business. Last June, £250,000 was raised at 2.2p a share. Coinsilium has been appointed as an adviser to token generation event of Hdac Technology AG, which is developing payment platforms for connected devices.
Equatorial Mining and Exploration (EM.P) has raised £5,000 at 0.01p a share and issued further shares for convertible loan notes and warrants at the same price. Valiant Investments (VALP) has raised £34,000 at 0.1p a share. Via Developments (VIA1) has issued a further £50,000 of debenture stock.
AIM
Satellites owner Avanti Communications Group (AVN) has revealed a financial restructuring that could put it on a firm footing. Certainly, without this restructuring the outlook would be bleak. The $557m of 2023 loan notes will be converted into two billion shares, while investors in the 2021 loan notes are being asked to accept and extension of the term and lower income. Annual interest charges would still be $36.6m
Best of the Best (BOTB) says that it expects to pay remote gaming duty and this will knock £300,000 from profit this year and £600,000 next year. This year’s pre-tax profit is forecast to decline from £1.5m to £1.4m, with a further fall to £1.2m in 2018-19. Net cash is expected to be £2.6m at the end of April 2018. The company is still claiming £4.5m of VAT so this could provide a cash boost in the future.
Plant Impact (PIM) is suffering continued delays in demand for its Veritas product in Brazil. A new partnership with Albaugh Brazil will commercialise other Plant Impact products in Brazil. This has sparked the decision to consider putting the company up for sale. Cash is running out and a further £7m would need to be raised to keep the company going well into 2019.
Van Elle Holdings (VANL) has defeated the five resolutions proposed by former chairman Michael Ellis at last week’s general meeting.
Recruitment and outsourcing services provider Servoca (SVCA) reported better than expected full year figures. Pre-tax profit improved from £3.5m to £3.9m. Education and healthcare will be the main growth areas.
Evgen Pharma (EVG) is collaborating with King’s College London to examine the use of SFX-01 as a therapy against ischaemic stroke. Multiple doses will be assessed and this will take nine months. This could lead to a clinical trial that might be funded by a charity organisation associated with King’s College.
Range Resources Ltd (RRL) returned to AIM following the reverse takeover of producing oil and gas assets in Trinidad from Trinity Exploration and Production (TRIN).
Defence equipment and services supplier Cohort (CHRT) had a weak first half but it expects to more than make up for that in the second half. There was a mixed performance with some parts of the business finding trading conditions difficult. The order book is worth £132m. Full year pre-tax profit is forecast to improve from £14.5m to £15.4m.
Savannah Resources (SAV) says that it has discovered high-grades and large intercepts in the latest drilling at the Mina do Barroso lithium project. A maiden mineral resource estimated could be announced before the year end with potential for upgrades from further drilling.
Daniel Stewart expects China New Energy (CNEL) to report a jump in pre-tax profit from £400,000 to £2.6m in 2017. The shares are trading on less than four times fully-taxed 2017 prospective earnings. The company constructs bioenergy plants that convert feedstock into ethanol. The most recently reported order book was worth £28.7m with the orders due to be fulfilled in 2017 and 2018. Demand from China is strong and there is also international business.
Coal bed methane projects developer Tlou Energy Ltd (TLOU) has secured a listing on the Botswana Stock Exchange and trading commenced on 13 December. Tlou raised £2.4m at 11p a share.
Synairgen (SNG) has secured a £5m cash injection from a deal with Pharmaxis, which will take over the development of LOXL2 in fibrotic diseases. Synairgen will also receive 17% of any partnering revenues. This compares with £3m invested by Synairgen in LOXL2. The cash will enable Synairgen to fund the phase IIa study for SNG001 for COPD. The trial should be complete by the end of 2018.
New management has turned around the performance of contract disputes and expert witness services provider Driver (DRV) and it moved back into profit last year. Cost savings have been made and the focus is on profitable business rather than just growing revenues. Cash collection is improving with net debt down to £200,000 and there is likely to be net cash of £2m in one year’s time. This year’s revenues are likely to be flat at around £60m but pre-tax profit should improve from £2.5m to £2.7m.
One month after its previous trading statement IDOX (IDOX) says that an internal audit has found that it should not recognise all the revenues that it originally intended to. This will knock £3m off profit for 2016-17. The software company reported its full year figures in December but the attest full year figures have been delayed until February. Chief executive Andrew Riley is away ill and former boss Richard Kellett-Clarke has taken over on a temporary basis.
Abzena (ABZ) reported interims in line with expectations. Growth came from the chemistry and manufacturing businesses. This is a period of capital investment as various parts of the company move to new facilities. The ADC master services agreement with a US biotech will yield at least $5m in services revenues over the next 12 months. This deal is shared between chemistry and manufacturing divisions.
Surface coatings provider Hardide (HDD) is starting to improve its gross margin as demand improves. There is even some signs of improved demand from the oil and gas sector. Even so, Hardide remains loss-making but it still has not gained any orders from Airbus. It raised £2.5m for capital investment earlier this year. A new reactor will be installed in the US in this financial year and another next year.
MAIN MARKET
Titon Holdings (TON) continues to benefit from strong demand for its window ventilation components in South Korea. The majority of profit comes from South Korea and that is where all the growth came from last year as the contributions from the UK and North America fell. In the year to September 2017, revenues were one-fifth ahead at £28m, while pre-tax profit improved from £2.14m to £2.49m. The dividend growth of 20% to 4.2p a share is ahead of earnings per share growth. A pre-tax profit of £2.81m is forecast for this year.
Avation (AVAP) has secured an initial $100m revolving facility to finance the acquisition of aircraft.
Sealand Capital Galaxy Ltd (SCGL) has secured an agreement with AIM-quoted MySQUAR (MYSQ) for the distribution of its games on MySQUAR’s platform and MySQUAR’s games on the Huawei InTouch platform. This is initially a two year deal.
Standard list shell Stranger Holdings (STHP) says that it expects to complete the acquisition of biogas and renewable energy business Alchemy Utilities. A five-year £20m bond is being raised.
Andrew Hore
Animalcare grows as Blur Group burns cash
Animalcare Group ANCR – Enters into a conditional share purchase agreement to acquire the entire issued share capital of European animal health company Ecuphar NV. The consideration for the Acquisition is structured on a consolidated Animalcare/Ecuphar Enlarged Issued Share Capital ratio of 37:63 (after taking into account dilution from certain Animalcare incentive arrangements), and will be satisfied through the issue of shares & cash to the Ecuphar vendors. The cash component will be satisfied in part through a placing of approximately 8.6m new shares (representing approx 40.4% of the existing share capital) to raise gross proceeds of not less than £30m, with the balance (of £4m) to be funded by existing cash held by the Group. The number of shares to be issued to the vendors of Ecuphar, will be determined following completion of the placing.
Blur Group BLUR – Continues to burn cash in its update today, cash balances at 31 May of $1.14m. Trading since 31 Dec 2016 has been in line with expectations, with finals from Blur due on 29 June 2017. As a result of the current cash balances, the company are sounding out new and existing potential cornerstone investors and evaluating alternative sources of near-term funding, which may or may not be forthcoming, within the next three to six weeks. If alternative sources of financing are not available the board would be required to take action to protect the interests of creditors and which could result in the value attributable to shareholders being severely reduced or becoming nil.
Trinity Exploration TRIN – Following the difficulties of 2015 and 2016, Trinity now has a clear strategic focus going forward, which is to grow reserves and production to maximise the cash flow from our assets while achieving a market value that is more reflective of underlying assets and business. Production has declined significantly from average levels of 3,600 barrels of oil per day in 2014 to current levels of approximately 2,500 bopd due to a lack of investment. The funding required to stabilise operations and recommence value extraction from the asset base was received in January, the primary focus during H1 has been to initiate essential maintenance and upgrades to infrastructure and to sustain base production levels whilst undertaking parallel planning activities to grow production across the portfolio from a range of; workovers, swabbing, re-activations, re-completions and new infill drilling.