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Andrew Hore – Quoted Micro 7 May 2018
NEX EXCHANGE
Forbes Ventures (FOR) has sold its stake in KCR Residential REIT (KCR) for £145,000. The remaining investment is in challenger bank Civilised Investments Ltd. Nigel Quinton, who has run two building societies, has been appointed as finance director of Forbes. Igor Zjali has become a non-executive director. The investment strategy covers disruptive technology in the property and fintech sectors.
KR1 (KR1) has been raising cash from partially disposing of token holdings. Cash has been generated from sales of tokens issued by six projects and this will be available for re-investment. KR1 has already acquired 30,587 tokens in the Waves project at $6.41 each.
Angelfish Investments (ANGP) says that there has been a further delay in its investee company Rapid Nutrition’s plans to gain a quotation in London. Rapid, which is already quoted on the SIX Swiss Exchange, has developed a nutraceutical product range. One of the terms of a £150,000 loan to Rapid was that it should be admitted to the London market by the end of February, but this date was extended to the end of April and has been extended again to the end of July. The principal and interest, up until the end of February, will convert into Rapid shares. Interest has been payable in cash since the end of February.
EPE Special Opportunities (ESO) reported a 35.6% decrease in NAV to 234.4p a share at the end of January 2018. That was mainly down to the poor performance of fully listed LED lighting company Luceco (LUCE) after sales growth did not turn into higher profit. EPE is considering exercising the option to redeem up to 50% of the outstanding unsecured loan notes. Redeeming £4m of loan notes would save £300,000 in interest. There is £28m in the bank.
Middle East-focused investment company Indigo Holdings (INGO) has lost €165,300 on an Iran-based car ride-sharing app. This will be mainly offset by a book gain of around €160,000 on its investment in Sheypoor following another fundraising round.
NQ Minerals (NQMI) has started to refurbish the Hellyer flotation plant in Tasmania. The mill should be commissioned in the third quarter of 2018.
First Sentinel (FSBN) has invested in AIM-quoted Amur Minerals and unquoted Titan FM Ltd in April. An investment of $250,000 has been made in the form of a contribution to a $10m loan facility made available to Amur. Titan FM is an acquisition vehicle in the facilities management sector with a focus on areas covered by strict regulation. The £50,000 pre-IPO investment helped to finance the first acquisition of a provider of air conditioning and refrigeration services. Two more acquisitions are planned this year as is a quotation on NEX. The latest tranche of First Sentinel bonds has raised a further £1m.
Valiant Investments (VALP) reported a flat full year loss of £216,000 and this would have been higher if there had not been a swing from a £3,000 loss on listed investment movements to a £25,000 gain. Valiant has invested some of its cash in five AIM-quoted, dividend paying companies. Valiant had a NAV of £197,000.
Sandal (SAND) has appointed David Munting as finance director and Richard Green as a non-executive.
AIM
Minds + Machines (MMX) swung from loss to profit in 2017 and it is acquiring four top level domains. Minds + Machines is paying $10m in cash and $31m in shares in two tranches for the membership interests of Florida-based ICM Registry, which owns .xxx, .sex, .adult and .porn. In 2017, revenues were $7.27m (78% recurring) and net income was $3.5m. The recurring nature of the revenues and the reduced dependence on China should help the group to start paying dividends in the next couple of years. Multinational brands buy related domain names with these suffixes so that nobody else can. This helps to boost recurring revenues. Not all of the other purchasers are sex-related, either. The main uncertainty concerns whether the group will get a lower rating because of the association with sex-related businesses.
Sanderson Group (SND) says that its interim results are slightly ahead of expectations and the positive momentum is continuing. The enterprise software supplier’s operating profit has increased from £1.55m to £2m. Two-thirds of the improvement has come from recent acquisition Anisa and the rest is organic.
DX (Group) (DX.) has raised £4.76m at 8.5p a share, which is much higher than the indicated minimum price of 7.41p that is being used to capitalise the company’s loan notes. These additional shares will heavily dilute existing shareholders. The cash will be used to restructure the parcel delivery networks, open new depots and finance IT investment.
Wynnstay Group (WYN) is acquiring eight country stores previously operated by Countrywide Farmers, which has gone into administration. Five of the stores take Wynnstay into Devon and Cornwall. The stores have annual sales of £16.4m.
Berkeley Energia (BKY) has announced plans to move to the standard list and the Spanish Stock Exchanges in Madrid, Barcelona, Valencia and Bilbao. The admissions should happen by the end of May. No money will be raised because the cash injected by the Oman sovereign wealth fund covers the upfront capital costs of developing the Salamanca project in Spain.
A combination of lower costs and higher iodine prices meant that Iofina (IOF) reduced its underlying loss from $5.4m to $3.4m in 2017. There was also a $5.3m impairment charge. There was a cash inflow before working capital movements. The new IO#7 plant started up in February and there could be another plant in the next year. Iofina is on course to be profitable in 2019.
Sinclair Pharma (SPH) has secured a €23m loan facility. This will replace bank debt and help to finance the aesthetics company’s new strategy in the US following the decision to terminate the Silhouette InstaLift distribution agreement with Thermi when reorder rates were disappointing. Negotiations are ongoing with potential distribution partners in the US. There was growth in other markets, including Brazil, and the 2017 loss was lower.
Pelatro (PTRO) provides precision marketing services to telecoms companies that helps them to retain subscribers and generate more income from each of them. Maiden results for Pelatro show a jump in underlying profit to $1.8m but the trade receivables are the most significant number in the accounts. Despite the profit there was a small cash outflow after tax payments. That is because trade receivables were $1.78m and $756,000 of that figure is for more than 121 days. That is because the company used extended payment terms to help to attract a customer. There is $3.1m in the bank so Pelatro has the cash to finance additional working capital for that and future deals. It is best to keep an eye on the trade receivables.
Rose Petroleum (ROSE) has raised £1m at 3.25p a share. The cash will be used to finance progress with the Paradox project towards being drill-ready. There are also other partnership and investment opportunities in the region.
Gloo Networks (GLOO) cannot find a suitable acquisition and it is winding itself up. Shareholders should receive at least 47p a share. The original placing price was 120p, so three-fifths of the cash has gone in less than three years without doing a deal.
Braime (TF and JH) (BMTO) reported a jump in pre-tax profit from £1.3m to £2.2m in 2017. The total dividend has been increased from 9.3p a share to 10.2p a share. Pressings profit was flat and the improvement came from the materials handling division.
Safestyle UK (SFE) says Steve Bermingham will retire as chief executive at the end of this year and he is being replaced by Mike Gallacher, who until recently ran First Milk, the farmer-owned milk business, which he restructured.
Trading in Green and Smart Holdings (GSH) shares was suspended because it did not publish its 2016-17 accounts by the end of March. The audit was expected to be completed by the end of April, but it is still going on and the accounts are not expected before June. Discussions continue with a potential investor.
MAIN MARKET
Stem cell services provider WideCells Group (WDC) is running out of cash and has not been able to publish its 2017 accounts so trading in the shares has been suspended. Directors have loaned the company a further £115,000, on top of a previous £100,000. At the end of June 2017, there was cash of £869,000 and debt of £634,000. That was before any of the director loans. It appears that management has taken too long to sort out the funding it requires and the potential share issue, if it is arranged, could be significantly dilutive.
Nanoco (NANO) has launched Nanoco 2D Materials Ltd in order to develop nanomaterials. The University of Manchester has invested £400,000 via a convertible.
Symphony International Holdings (SIHL) is paying an ordinary and special dividend of 12 cents in total. That will cost $71.5m. The Asian healthcare and hospitality businesses investor has sold investments and realised gains have helped to fund the payment.
St Ives (SIV) has completely exited book printing with the sale of Clays for £20m. The pension liabilities will stay with St Ives and it will contribute £2.5m to the pension fund. Net debt was £42.2m on 2 February 2018.
Trading in Sealand Capital (SCGL) shares has been suspended because it could not publish its 2017 accounts by the end of April.
Small Cap Awards (14 June, Montcalm Hotel, Marble Arch, London) Nominees
IPO of the Year
Alpha FX Group
Appscatter Group
Boku
Keystone Law Group PLC
K3 Capital Group
Rainbow Rare Earths Ltd
Ramsdens Holdings
Xpediator
Company of the Year
Bilby
Bioventix
Faron Pharmaceuticals
Frontier Developments
LoopUp Group
Nostra Terra Oil and Gas Company
TMT Investments
Water Intelligence
Wey Education
ZOO Digital Group
NEX Exchange Company of the Year
Chapel Down
Crossword CyberSecurity
Field Systems Designs
KR1
National Milk Records
Sandal
Daniel Thwaites
Walls & Futures
Executive Director of the Year
Zillah Byng-Thorne (CEO) and Penny Ladkin-Brand (CFO) – Future plc
Dr. Stuart Green, CEO – Zoo Digital Group PLC
Chris Gurry, Group Managing Director – CML MicroSystems PLC
Tom Ilube, CEO – Crossword Cybersecurity PLC
Dr Markku Jalkanen, CEO – Faron Pharmaceuticals
Bobby Kalar, CEO – Yu Group PLC
Dr. James Millen, CEO – Physiomics PLC
Ian Simm, CEO – Impax Asset Management Group PLC
Frazer Thompson, CEO – Chapel Down Group PLC
Andrew Wass, CEO – Gear4Music Holdings PLC
Impact Company of the Year Sponsored by Impact Investment Network
Ashley House
HaloSource
Walls & Future
Fintech Company of the Year
FairFX Group
FreeAgent Holdings
Proactis Holdings
ULS Technology
Transaction of the Year
Proactis Holdings PLC – Acquisition of Perfect Commerce
Work Group PLC / Gordon Dadds Group PLC – Reverse takeover
Atlantis Resources Limited – Uksmouth power stations deal (SUSPENDED)
Frontier IP Group PLC – Transactions FairFX Group PLC – Acquisition of CardOne
7digital Group PLC – Acquisition of 24-7
Impax Asset Management Group PLC – Acquisition of Pax World Management LLC
Analyst of the Year
Vadim Alexandre, Head of Research – Northland Capital Partners
Kevin Ashton, TMT Analyst – Cantor Fitzgerald
Eric Burns, Deputy Head of Institutional Research – WH Ireland Limited
David Johnson, Research Director – Allenby Capital Limited
Rob Sanders, Head of Growth Companies Research – Stockdale Securities Limited
Simon Strong, Head of Research Growth Companies – Cenkos Securities PLC
Journalist of the Year
Smit Berry – Small Company Sharewatch
Joanne Hart – Midas
Jamie Nimmo – Mail on Sunday
Paul Scott – Stockopedia
Mark Shapland – Evening Standard
Merryn Somerset Webb – Financial Times
Simon Thompson – Investors Chronicle
Fund Manager of the Year
Daniel Nickols – Old Mutual UK Smaller Companies
James Thorne – Threadneedle UK Smaller Companies
Nick Williamson – Old Mutual UK Smaller Companies
James Zimmerman – Jupiter UK Smaller Companies
Microcap Fund Manager of the Year
Guy Feld – Cannaccord (Hargreave Hale Limited)
David Horner – Chelverton Small Companies Dividend Trust PLC
Judith MacKenzie – Downing LLP
Katie Potts – Herald Investment Management
Gervais Williams – Miton Group PLC
Lifetime Achievement Award To be announced on the evening
Special Services to Small Caps To be announced on the evening.
Andrew Hore
Quoted Micro 6 November 2017
NEX EXCHANGE
Chapel Down Group (CDGP) says that the 2017 harvest was second best in the company’s history. There was a 10% volume increase on the previous year. The quality was also good. There had been fears for the harvest because of the frost in April but Chapel Down sources from a wide range of vineyards. Chapel Down has completed the acquisition of the 1.6 acre site in Ashford where the Curious Brewery will be developed.
Capital for Colleagues (CFCP) is setting up a joint venture to focus on consultancy and advisory operations so that the core business is purely involved in investment in employee owned businesses. Capital for Colleagues will own 34% of Castlefield Corporate Advisory Partners, with 51% owned by Castlefield Partners and the rest by executives of the joint venture.
Supported housing developer Walls and Futures REIT (WAFR) has delivered its first project and has a pipeline of other projects. The NAV is 94p a share. In the six months to September 2017, there was a £203,000 uplift in property values and that is why there was an interim profit of £127,000. There is £237,000 in the bank.
Mechanical and engineering installation work provider Field Systems Designs Holdings (FSD) reported a 19% increase in full year revenues to £17.2m. The main growth came from the water and sewerage operations and the AMP6 regulatory period is just getting going. Pre-tax profit more than doubled from £308,000 to £672,000.
South Africa-focused investment company Inqo Investments Ltd (INQO) still has R756,000 in the bank following further investments. Kuzuko Lodge continues to lose money but its occupancy and room rates are improving. Investee company Bee Sweet Honey harvest 133 metric tonnes of honey in May and this has generated revenues for Inqo.
Ganapati (GANP) reported a reduced interim loss of £4.54m, down from £8.75m. The online casino software and apps supplier increased revenues from £1.34m to £2.19m. A mobile operating system update has held back revenue generation from the company’s apps.
IMC Exploration (IMCP) has raised £75,000 at 1p a share and issued warrants that could raise a further £150,000 at 2p each. The cash will finance a feasibility study on the licence in Avoca in County Wicklow.
MiLOC Group Ltd (ML.P) has raised £540,000 at 28.5p a share and issued further shares as payments to consultants at 30p a share.
AIM
Sanderson Group (SND) expects its full year revenues to be slightly higher at £21.5m but underlying operating profit is anticipated to rise from £3.69m to £3.9m. That excludes £500,000 of reorganisation and acquisition costs. The digital retail software divisions continues to be the main growth area. The order book of £5.8m at the end of September is much higher than the same time one year earlier. It does include a large order that will be delivered over two financial years. There is more than £6m in the bank.
At last week’s general meeting of Stratex International (STI) the requisitioners were successful with their first and fifth resolutions but not the second. The third and fourth resolutions were conditional on the passing of the first two so they did not go to a vote. Marcus Engelbrecht has left the board and the acquisition of Crusader Resources appears unlikely to go ahead. The requisitioners want to inject joint venture Thani Stratex into the quoted company.
Diversified Gas and Oil (DGOC) completed the acquisition of the Titan oil and gas assets at the end of September. Operating costs have been reduced by 8% to $7.14/barrel of oil equivalent since the first half of 2017, which has helped margins to improve. Trading is in line with expectations.
Billing and charging software provider Cerillion (CER) says that its full year revenues increased 8% to £16.2m. Mobile telecoms operators continue to dominate the business but the customer base is set to broaden.
Sapphire producer Richland Resources (RLD) produced 1.06 million carats from its Capricorn mine in the third quarter of 2017 but this was lower than the 1.2 million carats that was expected because of mine disruption and rehabilitation. Production and operating costs were $0.75/carat. The next sapphire sales are this month. Illegally mined sapphires are holding back prices so only $245,000 was generated from sales in the third quarter as Richland held on to sapphires in order to sell them in the fourth quarter.
Redx Pharma (REDX) has come out of administration. The board will be writing to shareholders laying out its strategy and the suspension of trading in Redx shares could be lifted later this year.
Versarien (VRS) is trying to raise £1.2m via institutions and PrimaryBid.com at 18p a share. Back in March, £1.5m was raised at 15p a share in the same way. The advanced materials company will use the cash to buy capital equipment in order to fulfil the requirements for graphene-related collaborations. There are negotiations with two of the largest consumer goods companies in the world. An order is expected shortly and there are many other discussions ongoing. The Total Carbide business is winning aerospace work to offset the shortfall in demand from the oil and gas sector.
Proxama (PROX) has sold its loss-making digital payments division in order to concentrate on its location sciences technology business. The deal will raise £1m with potential deferred consideration of up to £1m over 18 months. The company will change its name to Location Sciences.
Starcom (STAR) has raised £475,000 at 1.3p a share. The cash will provide working capital for recently announced large orders and to repay $100,000 owed to YA II and $115,000 owed to other creditors.
INEOS has acquired an interest in shale gas licences where Egdon Resources (EDR) is also involved. Egdon plans to increase its onshore UK production this year. INEOS has taken on the obligations of Total to carry Egdon in the PEDL 139 and 140 areas. Egdon owns 14.5% of each of these licences. Egdon also has a £4.85m carry on PEDL209, where Egdon has a 36% interest.
Pakistan-focused coal mine developer Oracle Power (ORCP) says a memorandum of understanding should be signed this month. Oracle will retain a 12.1% stake in the block VI project. Sichuan Provincial Investment Group will take a 78% interest in the project and the other 9.9% will be owned by PowerChina International Group. The gross cost of the project is estimated to be $1.6bn and the debt/equity ratio will be 75/25.
Gordon Dadds (GOR) has made its first acquisition since reversing into Work Group. The lawyer will pay £4m over a five year period for CW Energy. There could be additional payments dependent on performance. CWE is a corporate tax adviser and prior to distributions to partners it made EBITDA of £1.3m last year.
MAIN MARKET
WideCells Group (WDC) has signed a five–year agreement with White Apex General Trading, which will provide the companies stem cell services. WideCells immediately receives £255,000. The agreement covers the stem cell insurance product, stem cell storage and the educational platform Wideacademy. A further £1.5m could be payable if the Wideacademy platform is adapted for Middle East, North Africa and Asia. There could be £250,000 of this paid by the end of this year.
OTHER MARKETS / UNQUOTED
Fashion On Screen continues to progress towards a floatation on Nasdaq First North in the first quarter of next year. It is also raising money for its first film, Will, which is based on the life of William Shakespeare, via the SyndicateRoom crowdfunding platform. There are at least two other films in development.
Andrew Hore
Quoted Micro 16 October 2017
NEX EXCHANGE
This month marks the 22nd anniversary of the launch of NEX Exchange, although it was then originally called Ofex. A number of companies have gone on to bigger things, including Genus, which is in the FTSE250 index and accesso Technology, which is one of the top 50 companies on AIM. Further information can be found at http://www.hubinvest.com/AIMPDFOctober2017_97.pdf
MetalNRG (MNRG) has applied for two cobalt licences at Palomino and north Palomino in Western Australia but a rival has applied for the latter licence. There has also been interest from potential acquirers of this interest. A report has been received about the company’s US cobalt interests and this is being reviewed. A potential uranium project has been brought to the company and it is considering the opportunity.
Indigo Holdings (INGO) has invested £10,000 in 3sootjobs, a job search platform in Iran, giving it a 1.53% stake. Turquoise, which owns 32.1% of Indigo, and related parties, including Indigo directors, own around two-thirds of 3sootjobs.
Ecovista (EVTP) has bought a 80% stake in a company that owns a four bedroom property near Stanstead and it has paid £10,000 for an option on the next door property. The properties cover 1.72 acres.
AIM
Parcel delivery company DX (Group (DX.) is raising £24m from an issue of convertible loan notes. The conversion price will be 10p a share and the interest rate 8%. There is potential to issue a further £2m of loan notes. Lloyd Dunn has been appointed as chief executive but he is not on the board. Along with three directors, he is subscribing for £5.25m of loan notes.
Angle (AGL) has further positive indications of the effectiveness of its Parsortix liquid biopsy technology and it has also raised a further £2.8m, taking the total raised at 37.5p a share to £15m. Heinrich Heine University researchers has been able to able to continue to grow circulating tumour cells harvested using a Parsortix device.
Fashion retailer Quiz (QUIZ) performed strongly in the first half and online sales have increased to one-quarter of the total. This was before the launch of a website focused on Spain and there are plans for other international websites. The UK stores grew sales by 15%. Overall revenues were 35% ahead at £56.1m.
Orogen (ORE) is acquiring Thread 35 Ltd and changing its name to Sosandar (SOS), which is the acquisition’s online womenswear brand. The brand was launched on 19 September 2016 by the founders of fashion magazine Look and is aimed at the affluent professional woman. Orogen is paying £6.3m in cash and shares for the acquisition. Ten Orogen shares are being consolidated into one new share. A placing at 15.1p a share will raise £4.8m net to cover the cash portion of the acquisition cost.
Toilet tissue supplier Accrol Group Holdings (ACRL) expects to pay between£550,000 and £2.9m and because of its guilty plea the amount will be discounted by one-third. The figure will be announced early next year. Talks continue with major shareholders and the bank.
Wynnstay Group (WYN) has appointed administrators to Just for pets and 18 of the stores have been sold to PSR Ltd. The other seven have been closed. The loss-making pet products retailer had net assets of £2.2m.
Crop enhancement products supplier Plant Impact (PIM) increased its full year revenues by 17% to £8.5m even though sales in Brazil were disappointing. Higher research and development spending meant that there was a £3m loss. There was £7.2m in the bank at the end of July 2017. Plant Impact is moving into new geographic markets as well as building share in its existing markets.
Motor dealer Vertu Motors (VTU) intends to use some of its cash to buy back up to £3m worth of shares. There was net cash of £20.8m at the end of August 2017. Interim revenues were flat at £1.45bn buy underlying pre-tax profit was 7% higher at £20.9m.
Patrick O’Sullivan, who failed to gain a board seat at Conroy Gold and Natural Resources (CGNR), has reduced his stake in the Irish gold explorer to three million shares (24.6%). Conroy was awarded costs of the court proceedings made by Patrick O’Sullivan and the level is still to be assessed. Conroy has decided to cancel its quotation on the Dublin-based Enterprise Securities Market on 6 November. Conroy will still be quoted on AIM so shareholder approval is not required. Andrea Gonella currently owns less than 3% of Conroy, having owned more than 6% in July. Conroy has raised €240,000 via a €0.30 a share placing and a further €167,000 was raised from warrants taken up by directors Professor Richard Conroy and Maureen Jones.
Digital Barriers (DGB) has decided to sell its video business for up to £27.5m. It will concentrate on its Thruvision people screening business.
InterQuest Group (ITQ) has appointed Allenby as its nominated adviser and Peterhouse as its broker so trading in the shares has recommenced. Chisbridge Ltd ended up with 58.3% of InterQuest after its bid. It still wants to ditch the AIM quotation and it can buy shares in the market in order to increase the stake.
Patient monitoring device developer LiDCO (LID) has gained its first long-term high use programme contract with a US customer but that did not contribute in the first half. In the six months to July 2017, revenues were 4% higher at £3.9m and the loss was £1m. That was due to higher sales and marketing costs without the benefits of higher sales yet showing through.
1Spatial (SPA) has sold its non-core assets so that it can focus on geospatial data. There is particular potential in the US market. Although interim revenues were flat at £12.1m but a greater proportion were from the geospatial business. The operating loss was reduced from £1.9m to £1.2m and the cash outflow in the period was minimal. Claire Milverton has been confirmed as chief executive.
Two graphene-related companies are raising cash. Applied Graphene (AGM) has raised £9m at 36p a share and existing shareholders are being given the chance to subscribe for up to £1m via a one-for-eight open offer. There was £4.7m in the bank at the end of July 2017. The cash is being used to finance joint development activity for the strategic ink programme, which uses 2D inkjet printing to deliver graphene-based inks. Other potential uses are also being explored. Haydale Graphene Industries (HAYD) is raising £10m via a placing and offer at 120p a share, which was a 32% discount to the market price. Haydale recently changed broker to Arden. The cash will be used to provide working capital for existing orders and to develop new uses for graphene, including cookware.
SaaS-based accounting software supplier FreeAgent Holdings (FREE) says that it generated interim revenues of £4.6m, compared with £3.6m. There was a smaller first half loss and had net cash of £3.4m at the end of September 2017.
Top level domain names owner and distributor Minds + Machines (MMX) has received approval from the authorities in China to sell .law, .work, .beer and the Chinese equivalent of .shopping. Four more extensions are going through the approvals progress. So far, revenues from China for .vip have been a significant contributor to group revenues.
A consortium led by former chief executive Peter Earl is in early discussions with Rurelec (RUR) about a bid that could be backed by Rurelec’s joint venture Patagonia Energy Ltd.
An application to enable Redx Pharma (REDX) to get back control of its main subsidiary will be heard on 26 October. If approved, the subsidiary will come out of administration and the suspension of trading in Redx shares could be lifted.
Realm Therapeutics (RLM) has completed the £19.3m placing at 29p a unit (one unit is one share and a warrant for 0.4 of a share). The warrants provide an opportunity to subscribe for a share at 58p each. The initial focus of the cash will be the treatments PR022 for atopic dermatitis and PR013 for allergic conjunctivitis. There are also plans for a phase II trial for the PR023 treatment for acne vulgaris.
PipeHawk (PIP) has sold its 28.4% stake in south east England-based survey practice SUMO Ltd to its own executive chairman Gordon Watt for £197,499. That is the equivalent of the investment in loss-making SUMO and is more than its value in the books.
Dr Cliff Holloway has been appointed as chief executive of Scancell Holdings (SCLP) and he will push forward the immunotherapy platforms being developed by the company. His predecessor Dr Richard Goodfellow is remaining on the board. Scancell had £2.67m in the bank at the end of April 2017, which was less than the cash outflow in the previous 12 months.
Ashanti Gold Corp says that the Anumso gold project, where Goldplat (GDP) is earning up to 75% through a $3m investment in exploration, has broader and new mineralised zones. Soil sampling has produced good results and suggests high gold recovery rates.
Former AIM company Zenith Hygiene has agreed a cash bid from BCPE Diamond UK. The deal values Zenith at £100m, based on its enterprise value, although the final amount depends on performance.
MAIN MARKET
Cash shell J2 Acquisition Ltd (JTWO) commenced trading on the standard list on 10 October, having raised $1.25bn. The shell is seeking a company with a strong market share and proven track record. If an acquisition is not made within two years, shareholder approval will be required for a further 12 months of operation.
Levrett (LVRT) has completed the acquisition of Nuformix Ltd for £12m in shares at 4p each and it has changed its name to Nuformix. A further £2.3m has been raised at 4p a share. Trading will recommence on 16 September.
Sealand Capital Galaxy (SCGL) has signed a memorandum of understanding with AIM-quoted MySQUAR (MYSQ) that will enable the two companies to distribute each other’s mobile games.
Monchhichi (MCC) still intends to follow Pembridge Resources (PERE) from AIM to the standard list but the move has been delayed until mid-November. This will follow shareholder approval for the €10m investment in artificial intelligence, machine learning and behavioural data science company Sentiance and the approval of the prospectus by the UKLA. Sentiance lost more than €2m on revenues of €1.4m in 2016.
WideCells Group (WDC) plans to launch its CellPlan insurance for stem cell treatment in Spain before the end of the year. A partner has been secured for the expansion of stem cell services in the Middle East, north Africa and Asia Pacific. White Apex General Trading will be exclusive strategic partner for three years.
Andrew Hore
Quoted Micro 21 August 2017
NEX EXCHANGE
Good Energy (GOOD) has set the date for general meeting requisitioned by rival renewable electricity supplier Ecotricity, which wants Dale Vince and Simon Crowfoot to join the board. The general meeting will be held on 6 September. Good Energy still believes it would be unwise to have the representatives of its rival on the board.
Via Developments (VIA1) has paid a £412,500 non-refundable deposit on a residential development site in Latimer Road, Luton. Funding still has to be secured for the £8.25m purchase price.
Early Equity (EEQP) has taken a 4% stake in Malaysian multi-level marketing business Early Infinity, which has a distribution agreement with healthcare products supplier Yicom, where Early Equity owns 32.1%. The purchase was funded by the issue of 10 million Early Equity shares. The plan is for Early Equity to buy up to 30% of Early Infinity. Five million Early Equity shares have been issued at 0.6p each to raise £30,000.
Karoo Energy (KEP) has published the competent persons report on the Kalahari Karoo basin shale gas play. There is insufficient data to estimate shale gas or quantify the associated risk. The Lower Ecca shales are broadly correlatable with the source rocks in the broader basin. The low, unrisked estimate of gas initially in place (GIIP) is 310 bscf and Karoo has a 93.475% working interest. The advice is that further exploration is required to improve the understanding of maturity trends and confirm the depths of the Lower Ecca shale.
Lombard Capital (LCAP) has issued a further £55,000 of 7.5% convertible unsecured loan notes 2018, taking the total to £100,000. The conversion price is 10p a share and there are ten warrants for each £1 loan note exercisable at the same share price. There is planning permission for 200 apartments.
Clinigen (CLIN) has approached Quantum Pharma (QP.) about a proposed cash and shares offer. Due diligence has to be undertaken before there is a firm bid. Clinigen is taking advantage of the work that Quantum management has done in selling non-core operations and improving the performance of the rest of the business. Quantum says the interim figures will be brought forward to 22 August.
DX (Group) (DX.) has ended discussions with John Menzies over the merger with its distribution division because suitable terms could not be agreed. There had already been a change in the proposals but this was not enough to make the deal go through. This will mean that DX requires to raise additional funds. The four people that Gatemore Capital wanted to be appointed to the board when it requisitioned a general meeting, later withdrawn, are being proposed as directors and Bob Holt will be leaving the board. Trading in the shares remains suspended.
Oozi Cats has been kicked off the board of Telit Communications (TCM) after it turned out that he withheld information about an indictment against him in the US when the company floated 12 years ago. There have been fears about the cash position of the business but the directors’ have tried to reassure investors. Telit plans to appoint three UK-based non-executive directors.
Tracsis (TRCS) has reassured investors that it should hit market expectations for 2016-17. This means that pre-tax profit will be better than the £6.9m reported in the previous year. Tracsis had warned that the second half would have to be strong in order to make the forecast and this has happened. There was £15m in the bank at the end of July 2017. A reorganisation of the traffic and data services division should improve margins this year. The full year results will be reported in November.
IDOX (IDOX) is acquiring electoral back office software provider Halarose for £3.5m in cash and £1.5m in shares. This will boost the market share of IDOX in the UK elections market and there should also be cost savings.
Wilmcote Holdings (WCH) is the latest shell backed by Marwyn to join AIM. The £15m raised will be used to seek significant acquisitions in the chemicals sector. The share price rose from 120p to 132.5p. Former Synthomer boss Adrian Whitfield is chief executive.
Market research firm System1 Group (SYS1) stunned the market with a profit warning that sent its shares down nearly one-third. The former BrainJuicer announced at its AGM that the lack of a repeat of a large contract last year means that gross profit could be up to 11% lower in the first half of this year. On top of this costs are rising. The interim figures are likely to show breakeven compared with a £2.8m profit in the first half of the previous year. Full year pre-tax profit could fall by up to 15% from last year’s level of £6.3m.
Bushveld Minerals Ltd (BMN) says that a study carried out in conjunction with the Industrial Development Corporation shows strong vanadium redox flow battery technology in Africa with the market peaking by 2025-2030. Global electrolyte demand is likely to peak at the same time at 1200-1800 MWh. There is potential for Bushveld to supply 200MWh of storage per annum and a study is being undertaken for a potential vanadium electrolyte production plant in South Africa. Vanadium mining and related battery technology is the focus for Bushveld. There was a small net cash position at the end of February 2017.
Malvern International (MLVN) reported a reduction in interim loss from £460,000 to £395,000 as revenues slumped from £2.07m to £1.65m. Malaysian revenues fell but operating costs were reduced. There is £360,000 in the bank. The loss in Singapore has been reduced and that was before EduTrust certification, which is required to enrol international students, was reinstated. There has been year-on-year growth of 17% in London revenues and the loss was sharply reduced. House broker WH Ireland is not publishing forecasts at the moment.
Pawnbroker H&T Group (HAT) reported a 62% increase in first half pre-tax profit to £6.2m and the interim dividend was raised by 10%. H&T has been compared with Ramsden (RFX) but the mix of operations and revenues is very different.
Connemara Mining (CON) has raised £200,000 via a placing at 1.75p a share and each new share has a warrant to subscribe for an additional share at 3.42p each. Patrick Cullen has been appointed as chief executive of the gold and zinc explorer.
Red Leopard Holdings (RLH) is in talks to acquire a coal project in Colombia. Red Leopard will have to issue shares with a minimum valued of $180m in order to acquire the La Luna project. Trading in the shares is suspended.
MAIN MARKETS
Stem cell services and insurance provider WideCells Group (WDC) has raised £750,000 at 14p a share and the cash will be used to finance growth in the three operating divisions. Positive news has helped to boost the share price over the past two months. This includes the granting of a research licence by the UK Human Tissue Authority. The CellPlan insurance product is on sale and a digital platform is being developed for the educational division, WideAcademy.
Myanmar Strategic Holdings Ltd (SHWE) has raised $423,000 at $10 a share, while $3.9m of loan notes have been converted into shares. The focus is on hospitality and education sectors. The company already operates three hostels in Myanmar and it has acquired the rights from Pearson to open English language centres. Last year, revenues were $330,000 and the loss was $2.38m. Dealings are due to commence on 22 August.
Pembridge Resources (PERE) is set to move from AIM to the standard list on 21 August. It has raised £2.27m at 1.6p a share. The move will provide more time for Pembridge to build up a portfolio of mining investments without worrying about doing this within the timescale required on AIM.
Quarto (QRT) has ended bid negotiations with an unnamed bidder less than a fortnight after revealing the talks. One of the stumbling blocks was the regulatory approval required by the bidder and the book publisher’s management did not want to be distracted from trading by a bid that could take a long time to come to fruition. This is despite the fact that the bid proposal was at an attractive premium.
Bluebird Merchant Ventures (BMV) has located the three historic entry points to the Gubong gold mine in South Korea. This will enable access to five of the veins that were previously mined when the gold price was much lower.
Andrew Hore
Corporate news review Tuesday 15th August 2017
Hargreaves Lansdown HL. reports net FY new business of £6.9bn, AuA up 28% to £79.2bn and active clients up 118k to 954k. PBT is up 21% to £265.8m, and HL raises its dividend by 20% to 29p per share.
John Menzies MNZS says it has enjoyed a positive first half, with underlying PBT up 36% to £24.7m and a proposed 11% increase in the interim dividend to 6p. Chairman Dr Dermot F. Smurfit said: “Overall, I am very pleased with the Group’s performance in the first half and we look to the future with confidence as demonstrated by the increased dividend payment.”
Mears Group MER reports interim results in line with management expectations, with revenue up 1% to £470.8m.
Plant Impact PIM publishes the first presentation on its R&D platform and pipeline. The full presentation can be found at www.plantimpact.com/investors.
Rockhopper Exploration RKH updates on the Abu Sennan drilling concession, onshore Egypt, in which the Company has a 22% working interest. Production from the six fields within the Abu Sennan concession remains stable, averaging 3,300 barrels of oil equivalent per day (“boepd”) gross during the first six months of 2017. The group also updates on the Al Jahraa-9 well.
WideCells WDC raises £750k gross through the issue of 5,357,143 ordinary shares at 14p per share via a private placing with new and existing shareholders and the Board of Directors. The funds raised will be used to execute on a range of additional opportunities the Group has identified since listing in July 2016, rapidly accelerate the roll out of its three stem cell services divisions, CellPlan, WideCells and WideAcademy, and further its penetration of the rapidly growing stem cell market.
Wood Group WG. / Amec Foster Wheeler AMFW – The CMA (Competition and Markets Authority) today accepts in principle the remedy formally offered by Wood Group on 9 August to complete the recommended all-share offer for Amec Foster Wheeler. Robin Watson, CEO of Wood Group said “Today’s announcement is an important milestone and gives us further confidence in our ability to complete the transaction in quarter four this year.” Jon Lewis, CEO at Amec Foster Wheeler said “We welcome the announcement by the CMA. Our offer of a proposed remedy in May and the early commencement of the sale process to potential buyers of the upstream oil and gas business has ensured we have navigated this process ahead of schedule increasing the likelihood that the transaction with Wood Group will close in quarter four this year.”
Quoted Micro 12 June 2017
NEX EXCHANGE
Brewer and pubs operator Daniel Thwaites (THW) says that net debt has increased from £34.1m to £47.6m at the end of March 2017 because of investment in the brewery and pubs plus acquisitions. The benefits of this investment is starting to show through. Full year revenues from continuing operations were slightly lower at £84.4m, while operating profit improved from £11.5m to £12.1m. The total dividend is unchanged at 4.46p a share.
Churchill Mining (GHL) has switched from AIM to NEX although trading in the shares remains suspended. Churchill’s main focus is the international arbitration claim against the Indonesian government.
Good Energy (GOOD) received applications for more than £10m of the corporate bonds on offer. The energy supplier has closed the online offer but postal applications close on 12 June – assuming the maximum application level of £20m has not been reached before this.
Coinsilium Group Ltd (COIN) has invested £56,000 in Singapore-based Indorse Pte Ltd, which is developing Indorse, a blockchain-powered professional social network. Coinsilium will also receive a number of Indorse digital tokens in the next few months.
China CDM Exchange Centre Ltd (CCEP) reported a decline in full year revenues from £1m to £898,000. Pre-tax profit fell by two-thirds to just over £2,000. There is £2.3m in the bank and the NAV was £52.1m at the end of 2016. The company is investing in blockchain technology as part of its growth strategy.
Asia Wealth Group Holdings Ltd (AWLP) says that the 45,000 shares it owns in Ray Alliance Financial Advisers have been transferred to the other two Ray Alliance shareholders without any authorisation. Asia Wealth paid $318,000 for the shares back in 2012. Asia Wealth has demanded that the shares are transferred back.
Valiant Investments (VALP) has raised £45,000 at 0.1p a share. The cash will provide working capital and provide the ability to invest more in apps business Flamethrower.
AIM
DX Group (DX.) has renegotiated the terms of the merger with Menzies Distribution which involves the payment of £40m in cash and shares equivalent to 65% of the enlarged share capital – this includes a 5% stake that will be held by the John Menzies pension fund. DX will still have to take on 17% of the pension fund. Cost savings of £10m a year are expected and a dividend is promised. Rebel shareholder Gatemore is backing the revised transaction. Things are still not running smoothly, though. The City of London police is investigating an allegation concerning DX.
MP Evans (MPE) harvested 180,000 tonnes of oil palm fruit bunches in the first five months of 2017, which is one-quarter higher than in the same period of 2016. This is due to a mixture of improving weather conditions and maturing plants. In the same period, palm oil production increased from 37,900 tonnes to 60.100 tonnes. The average selling price has increased by $51/tonne to $606/tonne, while palm kernel prices moved from $414/tonne to $503/tonne. There could be some downward pressure on prices in the second half.
Somero Enterprises Inc (SOM) has announced a special dividend of 13.3 cents a share on top of the normal dividend. This will cost $7.5m and leave the construction equipment company with much more than $10m in the bank even before allowing for cash generated so far this year. Shareholders on the register on 28 July will receive the dividend. Trading in Europe has been strong and the only disappointment has been North America where business has been delayed.
Best of the Best (BOTB) is also paying a special dividend out of its cash pile. Full year revenues grew 7% to £10.8m, while pre-tax profit improved from £1.1m to £1.5m. A normal dividend of 1.4p a share will be paid plus an additional 6.5p a share as a special dividend. There are also plans for the competitions organiser to increase marketing spending.
Waste to energy systems developer PowerHouse Energy Group (PHE) has secured a collaboration agreement with a UK partner that will provide two tranches of funding for the demonstration unit and five systems. The total funding will be up to £500,000.
DP Poland (DPP) has raised £5.25m at 43p a share. The cash will help finance 15 new Domino Pizza stores in Poland this year and finance loans for sub-franchise store openings in 2019.
Trading in Savannah Petroleum (SAVP) shares has been suspended following an exclusive agreement to buy the oil and gas assets of a west Africa-focused company. The structure of the transaction has been agreed in outline and it will involve debt, shares and cash. Due diligence has been going on since January. The shares will remain suspended until a document is published for the reverse takeover.
Nostra Terra Oil & Gas (NTOG) says that the general meeting requisition at US-focused oil and gas company Magnolia Petroleum (MAGP) is by former chief executive and founder Steven Snead using the shares that Nostra Terra has agreed to purchase. The proposals include the removal of chief executive Rita Whittington and the appointment the Magnolia board of Ewen Ainsworth, chairman of Nostra Terra, and Donald Phillips.
Vianet Group (VNET) has restructured its business into two divisions: smart zones and smart machines. Smart zones is based on the fluid measurement and telemetry business with pubs. The US business is moving towards breakeven. The smart machines division is focused on vending machines and there is a significant addressable market. There was a dip in underlying pre-tax profit form £2.8m to £2.6m last year, with a small improvement forecast for this year. The dividend is set to continue to be unchanged at 5.7p a share.
LiDCO (LID) has received 510k clearance from the FDA for the LiDCO Unity version 2. This will enable LiDCO to offer a high usage programme for a fixed annual licence fee. The head of US operations is already in place and ready to push ahead with the strategy. LiDCO is expected to move into profit in the year to January 2019.
Shareholders are trying to requisition a general meeting at Irish gold explorer Conroy Gold and Natural Resources (CGNR) in order to remove six directors. Seamus FitzPatrick, James Jones, Dr Sorca Conroy, Louis Maguire, Michael Power and David Wathen are the directors that the requistioners wants removed and replace them with Patrick O’Sullivan, Paul Johnson and Gervaise Heddle. The three directors not affected by the requisition are Professor Richard Conroy, Maureen Jones and Professor Garth Earls.
Disruptive Capital has made a bid approach to Stanley Gibbons (SGI).
MAIN MARKET
Telecoms services provider Toople (TOOP) raised £1.41m, before expenses of £150,000, and five million shares were issued to directors’ in lieu of a portion of the fees that they are owned. The subscription and offer are still open. On the day of the announcement, the share price fell 1.13p to 2.13p. There was a cash outflow of £552,000 in the six months to March 2017.
Rainbow Rare Earths (RBW) has discovered several unrecorded veins at Gasagwe, which suggests that there is plenty of upside in the mineralisation resources at the Gakara rare earth project in Burundi. Mine construction is on course to deliver rare earth concentrate before the end of 2017.
WideCells Group (WDC) says that it is authorised to sell its CellPlan financial product that helps people to afford stem cells treatment. There are plans to start selling CellPlan to Biovault stem cell storage customers.
Cathay International Holdings (CTI) says that its 50.56%-owned subsidiary Lansen Pharmaceutical plans to pay a special dividend.
Andrew Hore
Quoted Micro 17 April 2017
NEX EXCHANGE
Capital for Colleagues (CFCP) is raising £2.02m via a one-for-two open offer to existing shareholders at 42p a share and there are already commitments for 57% of this investment. The closing date is 27 April. The NAV was 43.5p a share at the end of February, which was hit by a write-off of a major investment. There are new investors will to take up shares worth £819,000 of they are not taken up in the open offer, or if there are not enough shares available additional shares will be issued.
Coinsilium Group Ltd (COIN) is joining forces with Oraclise to develop a smart contract system that can be used for the next generation of blockchain applications. The system will manage token issuance. There are already funds that trade in these tokens, which can be swapped for ownership rights in assets. Specific markets have been identified. The full details will be announced on Thursday.
Goldcrest Resources (GCRP) is acquiring a 100% interest in the Norio onshore production sharing agreement and has an option for a farm-in agreement to acquire 70% of Block VIII, which includes the East Khavtiskhevi onshore field. These assets are in Georgia and the current production at Norio is 25 barrels of oil per day. There are plans to increase production at Norio to 250 barrels of oil per day, which will enable Goldcrest to start generating cash during this year. Goldcrest has paid $380,000 and will issue $300,000 of shares at 0.5p each for 38% of Norio and then has the option to pay $620,000 plus $250,000 for the other 62%. Money will be raised by selling the existing gold exploration assets in Ghana.
Gunsynd (GUN) has received £3,000 in cash and 300,000 shares in Integumen in final consideration for the original skin treatment assets that Gunsynd, then known as Evocutis, sold in 2015.
Valiant Investments (VALP) has raised £47,750 at 0.1p a share.
AIM
Carpets manufacturer Victoria (VCP) says trading is ahead of expectations for the year to 1 April 2017. The performance has been helped by the integration of acquisitions in the UK and Australia. The new chief executive arrived too late in the financial year to have an impact.
MayAir Group (MAYA) improved full year revenues by 3% to $65.6m but pre-tax profit slumped from $7.5m to $5.9m because of a delayed contract. This contract has been completed and there should be a partial recovery in profit this year. The air filtration equipment supplier is on course to open its new facility.
D4T4 Solutions (D4T4) says that its earnings will be slightly ahead of expectations as higher margin software sales more than made up for lower project revenues. The 2016-17 pre-tax profit forecast has been edged up to £4.1m. There was £5.1m in the bank at the end of March 2017. There is still uncertainty about potential demand from a Japanese customer.
Arian Silver Corp (AGQ) has signed an option to acquire three lithium exploration projects in Mexico for up to $200,000 payable over 12 months.
Strategic Minerals (SML) has secured a deal to supply 400,000 tons of magnetite a year at a market based price over several years – depending on Strategic continuing to have access to the Cobre magnetite stockpile. This should double annual sales with a maintained margin.
More good news from software provider Cerillion (CER). Interim revenues have grown from £6.9m to £7.5m and EBITDA moved ahead from £1.1m to £1.5m. The interim figures will be announced in the middle of June.
Full year contributions from all its hostels meant that 2016 revenues generated by Safestay (SSTY) rose from £4m to £7.4m but it remained loss-making. NAV is 58p a share and the company is trading at a small discount to this figure. There has been a subsequent £12.6m sale and leaseback of the Elephant & Castle and Edinburgh hostels and a new £18.4m, five year secured debt facility provided by HSBC. This will reduce the cost of borrowings.
First Property Group (FPO) had funds under management of £475m at the end of March 2017, up from £353m a year earlier. Profit is expected to be in line with expectations before the recently announced sale of a property in Romania. The full year figures will be published on 8 June.
EMIS Group (EMIS) has appointed Andy Thorburn as its new chief executive. In the past four years, Thorburn has been chief operating officer of Caribbean-focused communications group Digicel. Prior to this has worked for a number of software companies and BT.
Dolphin Fund has decided not to proceed with a bid for FIH Group (FIH) because of the uncertainty caused by the attitude of the Falkland Islands government. Dolphin cannot make a bid for six months unless there is a rival bid announced.
Hague and London Oil (HNL) plans to acquire the Netherlands-based assets of Tullow Oil for an initial €9.75m with the potential to pay a further €20m. There are capital spending requirements for these assets which are generating revenues. Operating spending is estimated to be $21/barrel in 2017. The finance for the deal is being negotiated.
Gas and electrical services provider Bilby (BILB) is beginning to win work from the framework contracts it has been appointed to and this will boost the 2017-18 financial year. Northland has been appointed nominated adviser and broker.
Franchised property services provider Hunters Property (HUNT) grew its pre-tax profit from £1.42m to £1.85m in 2016. The dividend was increased from 1.5p a share to 1.9p a share. The subsequent acquisition of Besley Hill takes the group into south west England and the number of outlets has risen past 200. House broker Dowgate Capital forecasts a 2017 underlying pre-tax profit of £1.91m earnings per share may be slightly lower.
A reduction in admin expenses helped APC Technology (APC) to return to profit in the first half. Revenues declined from £9.5m to £8.3m but this was due to a large Morrison contract in the corresponding period. The core electronic components distribution business grew revenues by one-fifth. The underlying pre-tax profit was £200,000.
The second largest shareholder in Hornby (HRN) is requisitioning a general meeting to remove Roger Canham as chairman and from the board and replace him with Ian Anton.
MAIN MARKET
WideCells (WDC) has raised an additional £649,000 at 12p a share in order to accelerate the growth of its three divisions and develop a client relationship management system. Last July’s placing raised £2m at 11p a share. The CellPlan stem cell insurance product is selling better than expected. The stem cell storage facility will be operational in the second quarter and the company has applied for a research licence. The additional funds will help to finance additional appointments for its WideAcademy education and training business.
Andrew Hore
Quoted Micro 1 August 2016
ISDX
Asia Wealth Group Holdings Ltd (AWLP) made a further loss in the year to February 2016, although subsidiary Meyer Asset Management did make a profit – albeit slightly lower than previously. Revenues fell from $1.73m to $1.2m, while the loss increased from $79,000 to $150,000. Directors fees increased from $209,000 to $216,000. Asia Wealth is still seeking further acquisitions. There was $1.28m in cash at the end of February 2016.
South Africa-based Inqo Investments Ltd (INQO) fell into loss in the year to February 2016 following a number of one-off costs. The social impact company has renegotiated loans and that will save R30m of interest charges. The DBSA loan was settled after the period end and this will improve the financial position of the business.
Ganapati (GANP), the developer of apps for social media and games, is still hoping that its application to the UK Gambling Commission will be successful but there are still issues being discussed. In the year to January 2016, revenues increased from £216,000 to £2.3m but intangible write-offs totalling £4.56m meant that there was a reported loss of £7.47m. There was £1.28m in the bank.
Diversified Gas & Oil (DOIL) has taken the amount of 8.5% unsecured bonds 2020 in issue to £9.93m following the issue of an additional £460,000 of bonds.
Queros Capital Partners (QCP) has raised a further £150,000 from the issue of 8% unsecured bonds 2025. This takes the bonds in issue to £1.665m.
AIM
Satellite Solutions Worldwide (SAT) has made two more acquisitions that will be earnings enhancing this year. This more than doubles the customer base to more than 75,000. The satellite broadband services consolidator is paying £11.7m for Breiband and SkyMesh and it has raised £12.1m at 6p a share. Breiband offers broadband services in Norway so it fits in with the company’s strategy of consolidating the European market but SkyMesh is based in Australia so it is outside of the core strategy. The deals also move the group into the top five global satellite broadband suppliers. At the beginning of July, Satellite Solutions acquired UK-based Avonline for £10m and secured £12m of funding from the Business Growth Fund.
Bricks manufacturer Michelmersh Brick (MBH) reported flat revenues of £15.3m in the first half of 2016. Pre-tax profit edged up from £2.5m to £2.6m, while strong cash generation in the past 12 months has helped Michelmersh move into a net cash position. A kiln replacement project will be completed in the second half. First half brick sales dipped from 35.7 million to 35.1 million. Michelmersh has forward orders for 47 million bricks.
Learning management systems provider NetDimensions (NETD) says that interim revenues are lower than expected because of delays to customer roll outs. These delays could continue so the full year revenues forecast have been cut by $1.2m to $27m but, thanks to lower than anticipated costs, NetDimensions could break even this year.
Mineral sands miner Sierra Rutile (SRX) has received a bid of 36p a share in cash from Iluka Resources Ltd.
Information management software and services provider IDOX (IDOX) is acquiring Open Objects Software for up to £5.2m in cash and shares. Open Objects provides digital services to social and health care and it has a similar public sector customer base to IDOX. In the year to March 2016, the acquisition made an operating profit of £630,000 on revenues of £2.9m.
Publishing software and services provider Ingenta (ING) is acquiring advertising software company 5 fifteen Ltd for up to £990,000. This will widen the portfolio of products that Ingenta can offer and also broadens the customer base to newspaper and magazine publishers. The business loses money but costs can be reduced and sales can be made in new geographies. A subscription is raising £780,000 at 130p a share.
Mariana Resources (MARL) says that the mineral resource for its HotMaden project has been increased by 31% to 4 million ounces of gold at a gold equivalent grade of 10.2g/t. Northland has nearly doubled its target price from 54p a share to 104p a share.
MAIN MARKET
Stem cell services WideCells Group (WDC) has raised £2m at 11p a share in its flotation on the standard list. The share price ended the week at 12p. The cash will be used to build an integrated stem cell services company but it is still early days. WideCells is launching the CellPlan healthcare insurance product, which will help people gain access to stem cell treatments.
Macfarlane Group (MACF) is acquiring Nelsons for Cartons and Packaging for up to £6.75m in cash and shares. There will be two deferred payments depending on the performance of the packaging distribution business in the next two years. Leicester-based Nelsons will widen Macfarlane’s range of shelf ready packaging and there is little customer overlap. In the year to December 2015, Nelsons made an operating profit of £800,000 on revenues of £7.9m. The acquisition should be earnings enhancing in the first full year of ownership. A placing at 58p a share has raised £5.8m and this will fund the initial cash payment of £4.25m. Macfarlane says that its packaging distribution operations are growing but sales of the manufacturing division are 3% lower so far this financial year. Interim figures will be published on 25 August.
Healthcare properties investor MedicX Fund (MXF) has contracted to acquire a new medical centre in Rialto, Dublin. The total cost will be €8.6m and it will he let to the health authority on a 25 year lease with five-yearly rent reviews, plus separate leases for a pharmacy and other medical services providers. This part of a strategy to invest more in the Republic of Ireland. The annualised rent roll for the company’s portfolio is £37.1m.
Standard list shell Falcon Acquisitions (FAL) has agreed terms for the acquisition of Orbital Multi Media Holdings Corporation, which operates in the over the top (OTT) broadcast services market. There are still a number of conditions that have to be met for the deal to go ahead. Trading in the shares has been suspended.
Anglo African Agriculture (AAAP) has announced a strategic review which could lead to the sale of the business or the securing of a partner for the business. The chairman argues that the existing business is not large enough to justify a quotation and it has been difficult to secure additional acquisitions.
ANDREW HORE
Brand CEO Alan Green discusses IPO Widecells (WDC) on the VOX Markets podcast
Brand CEO Alan Green discusses IPO Widecells (WDC) with Justin Waite on the VOX Markets podcast. The interview is right at the start.
Click here to listen.