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Quoted Micro 15 July 2024
AQUIS STOCK EXCHANGE
Cadence Minerals (KDNC) is raising £750,000 at 2.5p so that it can provide funding for the Amapa iron ore project. This will be spent on testing the 67.6% green iron product flow sheet to pre-feasibility study level. The pre-feasibility study will then be revised. Earlier in the week, an updated study of the Amapa iron ore project, where Cadence Minerals owns 34.2%, shows process plant optimisation can be improved. The mine life of 15 years can have a throughput of 13Mt/year of iron ore. Cash cost is reduced to $33.50/t. The NPV10 for the project has increased by one-fifth to $1.1bn.
VSA Capital (VSA) reported a slump in full year revenues from £4.36m to £1.89m and there was a loss of £2.4m. There was a £1.67m loss on investments due to the reversal of a transaction with Silverwood Brands (SLWD). There was cash of £229,000 at the end of March 2024 and net cash of just over £12,000. Net assets are £1.66m. The £56m fundraising for Invinity Energy (IES) happened after the year end. The company is working on another large deal.
Oscillate (MUSH) has entered into non-binding heads of terms for the acquisition of Quantum Hydrogen Inc. The bid target has exploration rights over 60,000 acres in the state of Minnesota. There is a 60-day due diligence period. Richard and Charlott Edwards have reduced their stake in Oscillate from 8.31% to 7.6%.
Marula Mining (MARU) has acquired a 51% interest in the Kruisriver cobalt project in South Africa for an initial £100,000 in shares at 10p each and a further £100,000 on completion of due diligence. The mine used to produce cobalt. Marula Mining will fund an updated bankable feasibility study. A monthly management fee of £4,300 will be paid to the seller and after 12 months or less a further £200,000 in shares and $1.7m in cash will be payable. Marula Mining is also acquiring the Kilifi manganese processing plant in Kenya. It intends to buy mining operations to supply it.
Gunsynd (GUN) has decided to leave Aquis and it plans to acquire a 100% stake in the Falcon Lake uranium, copper and cobalt project and the Bear-Twit VMS project in Canada. The consideration is £200,000 in shares and cash. It will also commit £100,000 to work programmes. The last day of dealings on Aquis will be 9 August.
Skin treatments developer Incanthera (INC) has received a second Skin + CELL production order of 250,000 units from Marionnaud AG. This will be delivered before the end of March 2025. Total projected revenues for both orders are more than £10m.
Shortwave Life Sciences (PSY) has received a positive response from the PCT examining authority acknowledging its patent claims for its drug delivery platform for psychedelic-based drugs. More than nine million shares have been issued as deferred consideration for the acquisition of Shortwave Pharma Inc.
Quantum Exponential Group (QBIT) is still talking to a potential investor and there have been indications of interest from others. These discussions have been going on for weeks, but management believes that they have potential for a positive conclusion.
Software developer IntelliAM (INT) has secured a funding award of £263,000 from DIF Lighthouse Fund. This is for research into the application of AI in lubrication analysis. A machine learning model will be created. Gresham House Asset Management holds 23.5% of the company.
United General is investing €1m in Substrate AI (SAI). Jonathan Belliss has increased his stake in Hot Rock Investments (HRIP) from 3.4% to 15.5%. Coinsilium Group (COIN) chief executive Eddy Travia and chairman Malcolm Palle each bought 300,000 shares at 1.67p each. Shepherd Neame (SHEP) non-executive director George Barnes bought 1,000 shares at 666p each. Tap Global Group (TAP) chief executive Arsen Torosian bought 12.25 million shares at 0.5p each.
EPE Special Opportunities (EO.P) had net assets of 246.28p/share at the end of June 20204.
AIM
Rosebank Industries (ROSE), which was set up by founders and management of FTSE 100 index constituent Melrose Industries, joined AIM on Thursday 11 July. Just like Melrose Industries, Rosebank Industries has started out on AIM as an investment company seeking a large initial acquisition. The plan is to identify underperforming industrial and manufacturing companies, acquire them and improve their performance. Rosebank Industries raised £50m at 250p/share and the share price soared on the first day and the momentum continued on Friday. The share price jumped to 675p.
Trading is in line with expectations at production machinery supplier Mpac (MPAC). Sales are likely to increase by 16% in the first half of 2024 and operating profit could nearly double. That is partly due to a weak first half in 2023. The order book is valued at £71m. New customers are being won with the Americas doing well.
Market research firm System1 Group (SYS1) has provided a first quarter update one week after publishing 2023-24 results. All geographic regions are growing, and group sales are 53% ahead of the first quarter of the previous year. This is a record quarterly figure. The company appears well on course to improve full year pre-tax profit from £3.1m to £4.4m.
Property services provider Kinovo (KINO) has almost sorted out its problems with former subsidiary DCB following the collapse of the buyer. The total liability is £12.9m with the final site set to be completed within weeks. That is a figure before any cash that could be recoverable. This could reduce the figure by more than £2m. Most of the cash has already been paid and the final amount of £2.2m will be paid over 18 months. In the year to March 2024, Kinovo revenues improved from £62.7m to £64.1m even though a private sector renewables contract worth £3.6m/year was not renewed by choice. Free cash flow was £7.2m and the DCB outflow was £7.4m.
In the year to March 2024, TPXimpact (TPX) revenues increased from £69.7m to £84.3m, while pre-tax profit improved from £800,000 to £1.8m. Disposals and reduced working capital meant that net debt fell from £17.5m to £7.1m. There is no dividend and that is likely to continue to be the case. The debt facility is £25m and lasts until July 2026.
Driving safety technology developer Seeing Machines (SEE) has bought Asaphus Vision, a machine learning and AI technology developer, for up to $6m from automotive components supplier Valeo and secured a collaboration agreement. The deal adds IP to the group and three ongoing automotive programmes. There is also a new Berlin base that will help to boost European business.
Communications and power products supplier Solid State (SOLI) reported a jump in full year pre-tax profit from £10.8m to £15.6m, but this level of profit will not be maintained this year. There was strong demand in the systems division and a £10m order was delivered earlier than expected.
Legal services provider Knights Group Holdings (KGH) reported figures for the year to April 2024 showing pre-tax profit improving from £11.5m to £14.8m and the total dividend was raised to 4.4p/share. This year has started well with residential property business recovering and net debt should reduce.
Investment company Mindflair (MFAI) was given a boost by the acquisition of Landvault by AI company Infinite Reality. Landvault is valued at $450m in shares and is part of the portfolio of Sure Valley Ventures Fund, where MindFlair holds13%, plus a further 5.3% via its stake in full listed Sure Ventures (SURE). The fund owns 7% of Landvault and the valuation of the stake is $6m, which is a 470% increase on book value at the end of 2023. That suggests that MindFlair’s share is nearly $1.1m.
Biome Technologies (BIOM) is still suffering from delays in orders at its bioplastics division and technical validations may not be finalised until later in 2024. Also, the coffee packaging market has weakened. In contrast, there should be significant revenues from the RF Technologies division. Overall revenues will be well below expectations. A small loss is expected for 2024. Additional working capital may be required.
Business recovery services provider Begbies Traynor (BEG) reported an improvement in pre-tax profit from £20.7m to £22m in 2023-24 as expected. There is organic growth as well as contributions from acquisitions.
Employee benefits and insurance provider Personal Group Holdings (PGH) is selling Let’s Connect, which it acquired ten years ago, at well below the purchase price. In 2014, Let’s Connect was acquired for an initial £6m. The Perkbox Vivup Group is paying £2m for technology salary sacrifice business Let’s Connect.
Demand for fixed interest fund has pushed up the assets under the management of Premier Miton (PMI) by 8% to £10.6bn. There has also been a more recent recovery in funds inflows for international equity funds. Multi-asset funds are less appealing to investors.
TV programmes producer Zinc Media (ZIN) has secured 2024 revenues of £28m, which is lower than the same time last year. There have been delays to signing deals, so that could be a timing issue. Improving TV advertising revenues could reduce the constraints on budgets and increase activity in the second half. Singer is maintaining its 2024 forecast revenues at £41m. The corporate video and branded content business has been restructured and costs reduced.
Pit optimisations at the Dokwe gold project in Zimbabwe, recently acquired by Ariana Resources (AAU), have increased measured and indicated resources by 16%. Dokwe could produce 75,000-100,000 ounces of gold/year for more than a decade. A revised pre-feasibility study should be published in a few months. The previous study suggested a post-tax NPV10 of $160m.
Oracle Power (ORCP) says drilling results from the Northern Zone project in Western Australia has intersected gold mineralisation to the north and south of the maiden resource. There is shallower supergene gold mineralisation than anticipated. Further drilling is planned to the north east.
Crimson Tide (TIDE) shares declined after Ideagen decided not to bid.
MAIN MARKET
Packaging manufacturer and distributor Macfarlane Group (MACF) has made another earnings enhancing acquisition. It In 2023, pre-tax profit was £1.3m. This deal will broaden the scope of the group’s protective packaging operations.
Creightons (CRL) has impaired the valuation of skincare company Emma Hardie, acquired for £6.2m, by £4.5m. Results will be published on 18 July.
Metals X has taken a 22.6% stake in First Tin (1SN), having acquired the shares from Clara Resources. Metals X will also subscribe for 11.5 million shares in the £2.1m fundraising at 4p/share.
Andrew Hore
Quoted Micro 8 August 2022
AQUIS STOCK EXCHANGE
Guernsey-based Inteliqo Ltd (IQO) plans to become a distributor of a range of technology products. The first is an earbud that can translate 42 languages in real-time. There is limited liquidity with little more than 2% of the shares not held by the five main shareholders. A lock-in agreement means that more than 90% of the shares cannot be sold for 12 months. This is reflected in the bid/offer spread of 1p/4p, which effectively means that the share price was unchanged on the first day of dealings. There were no trades. Pro forma net assets are £557,000, which is equivalent to 0.5p a share.
Quantum Exponential Group (QBIT) has made a £450,000 investment as part of a £12m fundraising by QLM Technology Ltd, a photonics hardware and technology developer. It has developed a gas imaging camera based on quantum technology. The technology will be integrated into lead investor Schlumberger’s end-to-end emissions solutions business. It can be used to quantify greenhouse gas.
TruSpine Technologies (TSP) says that the instrument sterilisation testing for the FDA 510k submission has been delayed due to problems getting a supply of medical grade steel.
Love Hemp Group (LIFE) says full year revenues fell 16% to £3.6m. This was hit by delays to the UK novel foods product register. Second half operating costs have been reduced. Two major listings of CBD products have been agreed.
VVV Resources (VVV) had £87,000 in cash and net assets of £148,000 at the end of 2021. A share purchase agreement should lead to VVV owning 100% of the Mitterburg copper project in Austria and the Shangri La polymetallic project in Western Australia – it already owns 51% of this project.
Wishbone Gold (WSBN), which is also quoted on AIM, reported encouraging visual drilling results at the Red Setter project, Patersons Range, Western Australia. This has prompted management to secure a second drilling rig.
SulNOx Group (SNOX) has won its first order for fuel conditioner in Costa Rica for evaluation and an additional order in Germany.
MiLOC Group Ltd (ML.P) revenues declined from HK$20.5m to HK$4.94m and a profit became a loss.
Chris Akers has increased his stake in Quetzal Capital (QTZ) from 21% to 22%. John Mahtani has cut his stake from 3.83% to below 3%.
AIM
Bumper fuel profit meant that NWF (NWF) produced record results in the year to May 2022. Group revenues were 30% ahead at £878.6m, while underlying pre-tax profit jumped from £11.9m to £20.9m. That was excluding a £8.3m impairment charge for feeds division assets. There was a continued steady increase in the total dividend to 7.5p a share. All three divisions improved their profit during the year and NWF has net cash of £9m. There were no acquisitions last year, but the cash in the balance sheet will help to finance further fuels deals. The plan is to spend £10m a year, paying around six times operating profit. That will enhance earnings.
Filtronic (FTC) narrowly beat June’s upgraded full year results for the year to May 2022. Revenues improved from £15.6m to £17.1m, while pre-tax profit jumped from £200,000 to £1.5m. The mix of product sales boosted margins. Higher margin defence and critical communications sales grew, while lower margin Xhaul telecoms revenues fell, although they were stronger in the second half. There is likely to be a greater proportion of Xhaul sales in this year’s forecast revenues of £19m. That means that group margins will decline. Pre-tax profit is expected to be £800,000 and net cash could rise to £4.4m.
Cosmetics supplier Revolution Beauty (REVB) has delayed its 2021-22 results and cut its expectations for 2022-23. Poor retail demand in the US and the loss of £9m of Russian and Ukraine revenues have hit the early part of the new financial year. Online demand is switching to store sales and cost increases have hit profitability. Zeus has cut its 2022-23 EBITDA forecast by 38% to £19m, while higher net debt means that earnings are reduced by 64% to 1.5p a share.
Lithium-ion battery cell technology developer AMTE Power (AMTE) has secured a partnership with Cosworth for its Ultra High Power (UHP) rechargeable pouch battery cells. This follows the announcement that AMTE Power has chosen a site in Dundee for a new 0.5GWh battery production facility. Cosworth is a global technology business that used to be famous for making Formula One engines. It can design, develop and manufacture engines. Cosworth recently acquired electrification business Delta and this deal will add to the expertise.
TV programme producer Zinc Media (ZIN) is acquiring The Edge Picture Company and raising £5m at 100p a share. The Edge is based in London and Qatar and is a brand and corporate film maker. Clients include Barclays, Amazon and FIFA. In 2021, revenues were £8.2m and EBITDA was £800,000. There is initial consideration of £2.1m in cash and shares with up to £3.875m payable if a total of £5m of operating profit is made over the three years to June 2025.
Omega Diagnostics (ODX) has completed the sale of the CD4 business for up to £6.1m. The initial £1.1m has been paid. A further £4m will be paid when a clinical study is completed in Kenya. There was a monthly cash outflow of £300,000 a month from CD4. The ongoing focus will be the health and nutrition business.
Yacht services provider GYG (GYG) is asking shareholders to agree to drop its AIM quotation at a meeting on 31 August. Disappointing trading in recent years and lack of investor interest are two reasons for the proposed cancelation. Costs can be reduced by €700,000 a year. The half year trading update says that revenues are in line with expectations and the order book is strong. However, there is a lack of capital to grow the business.
Symphony Environmental (SYM) raised £1m at 18p a share from Sea Pearl Ventures and there are four million warrants associated with the placing that are exercisable at 25p each. Sea Pearl will own a 17.4% stake in the oxo-biodegradable plastics technology developer. First half revenues dropped from £4.9m to £3m due to logistics problems and orders delayed.
Piling contractor Van Elle (VANL) reported much improved figures for the year to April 2022 with revenues were 48% ahead at £124.9m, while the group returned to profit. Rig utilisations levels have improved. This year, pre-tax profit is expected to improve from £3.6m to £5m this year.
Franchise lettings group Belvoir Group (BLV) revenues increased 11% in the first half of 2022 with lettings growth offsetting lower property sales after stamp duty incentives ended. The fastest growth came from financial services, where revenues are 19% ahead.
MAIN MARKET
Ground engineering and piling business Keller (KLR) operating profit increased by 19% to nearly £50m as revenues jumped 31% to £1.38bn. Revenue expectations have been raised, but higher costs will reduce margins and there is an additional £1m interest charge, which means that the pre-tax profit forecast is cut by £1m to £101m.
Motor dealer Pendragon (PDG) has ended discussion with a potential bidder, which was potentially going to offer 29p a share. One major institutional shareholder was not supportive of the deal.
First Tin (1SN) has commenced the definitive feasibility study at the Taronga tin deposit in Australia.
Canadian Overseas Petroleum (COPL) has confirmed that the Wyoming deep discovery has total original oil in place of 993.5 million barrels. Three horizontal wells are planned for the 2022-23 drilling campaign.
News publisher National World (NWOR) increased first half revenues from £42.1m to £43.5m and the underlying pre-tax profit improved from £3.5m to £5.6m. This masks a 41% increase in digital revenues. There are £3m of annualised savings planned by the end of 2022. There is even a plan to announce a dividend with the full year results.
Andrew Hore
Quoted Micro 25 April 2022
AQUIS STOCK EXCHANGE
Gunsynd (GUN) had net assets of £5.99m at the end of January 2022. That includes £1.08m in cash. Investee company Low6 is still seeking a listing in Toronto via 1319735 BC Ltd. Mining investee company Charger Metals plans to start its maiden drilling programme at the Coates project in Western Australia. First Tin joined the Main Market after the period end.
Tectonic Gold (TTAU) has appointed Ian Bruce as exploration manager, and he will restart the drilling at Specimen Hill. A permit has been secured in the same area for Taree Fields, which was historically a high-grade copper mine. Deep Blue Minerals, where Tectonic owns 10%, raised $236,000 from diamond sales.
Lombard Capital (LCAP) has agreed in principle the sale of LCP Financial to SBS Group for £4.2m in shares and the repayment of a £370,000 intercompany loan. Lombard Capital will acquire Waste and Recycling Services before the sale is completed. Management will be seeking shareholder approval to leave Aquis.
ChallengerX (CXS) has signed a five-year agreement with The American Arena League for the use of the SaaS-based platform CXSports. This will help to promote the league and generate revenues.
Blockchain and open finance investor Coinsilium (COIN) has agreed to purchase $200,000 of YELLOW tokens for the Yellow Network, which is a cross chain overlay, financial information exchange and distributed infrastructure network.
Adam Pollock, who was previously head of corporate and institutional at WH Ireland, has become a director of Oberon Capital, the broking business of Oberon Investments Group (OBE).
Vulcan Industries (VULC) has raised £48,000 at 1.37p each.
All Star Minerals (ASMO) is changing its name to Marula Mining.
AIM
TV programmes producer Zinc Media (ZIN) lost on £2.61m on revenues of £17.5m in 2021. There is already £13m of booked revenues for 2022 and there is potential further business worth £35m that could be delivered this year. A greater proportion of the work being won is for series, rather than one-off programmes. Zinc Communicate, which produces non-broadcast content and podcasts, is becoming increasingly important. The timing of the orders is uncertain and not all the work will materialise, although £8m is at an advanced stage. This suggests that 2022 revenues should be much higher, and Zinc Media should become profitable and cash generative. Last year, the cash outflow from operations was £245,000. Net cash was £2.18m at the end of 2021.
Churchill China (CHH) is beating its rivals thanks to its capital expenditure and investment in marketing, and it has a better order book than normal for this time of year. In 2021, pre-tax profit bounced back from £800,000 to £6m as revenues recovered from £36.4m to £60.8m. The total dividend is £24p a share, while there is £19m in the bank. Churchill China has taken on more than 200 additional staff in the past year and they still require training. Last autumn, selling prices were raised by 12% and a 5% increase is planned for May. That will help to offset the cost rises. Pre-tax profit is expected to be between £8m and £8.8m this year.
Tungsten West (TUN) is reviewing development options for the Hemerden mine because of rising costs. This will lead to a two-month delay. This could lead to a focus on sodium tungstate production because it is higher value than ammonium paratungstate.
Solid State (SOLI) continues to best expectations. Revenues for the year to March 2022 will be around 6% ahead of previous expectations at £85m, while there is a 11% upgrade in pre-tax profit to £7.4m.
Seeing Machines (LSE: SEE) has secured a collaboration with Magna to develop and demonstration model driver monitoring system (DMS) combining, camera, electronics and interior mirror technology. This should help Seeing Machines win more market share.
Plant-based polymers developer Itaconix (ITX) says volumes continue to increase, particularly in the dishwashing detergent ingredients market.
Coral Products (CRU) is trading ahead of expectations in the year to April 2022 and there is a second interim dividend of 0.4p a share. There could also be a final dividend to add to this year’s total of 0.9p a share.
MAIN MARKET
Nuclear-related business has helped structural steel supplier Severfield (SFR) to enjoy record orders. Logistics, infrastructure and data centres are other areas of high demand. Longer-term, battery manufacturing plants could be another booming area. The current order book is worth £479m. The 2021-22 figures will be in line with expectations with pre-tax profit forecast to improve from £24.3m to £28.1m. This year’s revenues should be better than previously expected, but profit expectations have been maintained because of higher steel costs. The higher steel prices mean that higher working capital is required.
Full year profit of kitchenware retailer ProCook Group (PROC) will be slightly lower than expected at £9.5m. ProCook has grown revenues in a market that is slightly down
J Smart Contractors (SMJ) reported a decline in interim revenues from £5.75m to £5.16m, while pre-tax profit jumped from £890,000 to £6.35m, although that was due to a gain on the sale of investment properties of £6.06m. It is unlikely that full year profit will be higher this year. Net assets are £117.2m, including £76.2m of investment properties and net cash of £27.6m. The interim dividend is 0.96p a share and the ex-dividend date is 5 May.
Andrew Hore
Andrew Hore – Quoted Micro 10 December 2018
NEX EXCHANGE
TechFinancials Inc (TECH) is developing a blockchain-based sports ticketing business with Footies Tech Ltd. The new company will licence blockchain technology from TechFinancials, which will have a 75% stake in the company. TechFinancials will provide up to $500,000 to the company and this commitment is dependent on a client signing up within three months. The idea is to make the sports club take control of the initial sale and any secondary ticket transactions. Former Liverpool FC chairman Ian Ayre will be chairman of the new company.
Eight Capital Partners (ECP) has invested £60,000 in Pelican House (PHM) at 0.45p a share. Eight Capital will be issued 13.33 million warrants exercisable at 0.45p a share. Eight Capital is appointing John Treacy to the board of Pelican, which is changing its investment strategy from natural resources to sports and leisure.
Crossword Cybersecurity (CCS) has raised £2m at 290p a share and it will move to AIM on 14 December. The share price peaked at 430p in March. Crossword is valued at £13.6m at the placing price. Hargreave Hale AIM VCT has taken a 7.37% stake.
Early Equity (EEQP) is assessing additional investments that fit its strategy. There was £437,000 of cash in the balance sheet at the end of August 2018. The main investment is a 47.1% stake in healthcare products distributor Yicom Global.
Miton has increased its stake in Wheelsure Holdings (WHLP) from 15.5% to 17.8%. DXS International (DXSP) chief executive David Immelman has bought 20,002 shares at 9.9p each, taking his stake to 10.45%.
Welney (WENP) is considering a couple of proposals that can enable the company to move ahead. The loan note holders have agreed not to call in the loans for at least another 12 months. Net liabilities were £268,000 at the end of June 2018.
Block Commodities (BLCC) has launched the Farmer 3.0 (described as an integrated agri-business ecosystem) pilot project, which covers up to 1,000 Ugandan farmers. The plan is to expand the service to up 50,000 farmers.
AIM
Plastics Capital (PLA) has still to see the benefits of its investment in capacity and winning new business. In the six months to September 2018, revenues improved 11% to £40.6m and underlying pre-tax profit recovered from £1.2m to £2.1m. Net debt was £15.7m at the end of September 2018 to £14.5m by March 2019. Cenkos forecasts a 2018-19 profit of £5m, rising to £5.4m next year.
Broker finnCap (FCAP) joined AIM and completed the acquisition of Cavendish Corporate Finance last week. finnCap raised £3.75m at 28p a share.
The People’s Operator (TPOP) has the chance to receive an investment from the owner of LycaMobile. A share capital reorganisation is required before any shares can be issued. Every 2,000 shares will be consolidated into one share. An investment of £1.3m will be in shares (29.9%) and convertible loan notes – convertible at 10p a share.
Evgen Pharam (EVG) says that the final patient in the STEM:SFX-01 trial for metastatic breast cancer will take her last dose by the end of 2018. The final readout for the trial should be in March.
Ceres Power (CWR) has finalised its collaboration with Weichai Power. They will create a fuel cell manufacturing joint venture in China and technology will be licenced to the new venture, which could generate up to £30m in payments. There is also a £9m joint development agreement for range extenders for electric buses. Weichai will invest £28m at 164.5p a share.
Hagai Tal has resigned as chief executive of Taptica International Ltd (TAP) after he was criticised about his actions at a previous company. Rivi Bloch takes over as interim chief executive. The business appears to be changing with revenues not up to expectations but margins improving.
Panther Securities (PNS) is paying a special dividend of 15p a share after what it calls the best year it has experienced. Next year at least 12p a share will be paid.
Woodford has says that it will subscribe £8m in a fundraising for eve Sleep (EVE) and Channel 4 says that it will invest £900,000. Chairman Paul Pindar will invest £1m. Discussions continue with other investors in order to raise the £15m required.
Vianet (VNET) is growing its smart machines operations and it was responsible for the growth in revenues in the first half. The pubs market remains tough and smart zones revenues dipped, but there is the prospect of a large order in the US. Full year profit is expected to improve from £2.7m to £3m. The interim dividend is maintained and the total dividend for the year should be unchanged at 5.7p a share.
Versarien (VRS) has signed a supply agreement to supply a new graphene enhanced polymer range to AECOM. Interim revenues were 19% higher at £5.22m. There was cash of £6.07m at the end of September 2018. There was a £1.1m cash outflow in the six month period.
Omega Diagnostics (ODX) continues to lose money and net debt was £700,000 at the end of September 2018. The £2m overdraft facility should provide enough finance for the company’s needs. The commercialisation of Visitect CD4 is important to long-term progress for the company. CE marking for advance disease should be awarded soon. The timing of approvals and therefore revenues is difficult to predict.
Pebble Beach Systems (PEB) has resolved its dispute with xG Technology Inc over the disposal of its hardware business. No further liabilities are due by either party and the forecast cash balances for Pebble Beach will not be materially different.
Rose Petroleum (ROSE) has agreed an operational plan with the Utah authorities for its acreage in the Paradox Basin and this includes recently acquired acreage. A suitable drilling rig should be available in the first quarter of 2019. The plan is to secure funding for the drilling programme.
Zinc Media Group (ZIN) has appointed Mark Browning, who is currently boss of ITN Productions, as chief executive and he will start in the first half of 2019. He replaces former finance director David Galan, who became full-time chief executive in February.
Adam Formela has stepped down as chief executive of packaging manufacturer Robinson (RBN). Martin McGee has become interim chief executive.
Trading in the shares of MySQUAR (MYSQ) will end on 10 December. Additional cash is required and a sale of assets to a NEX-quoted company in return for shares could happen. The investigation of past financial transactions continues.
Fishing tackle retailer Fishing Republic (FISH) has appointed administrators.
MAIN MARKET
Cryptocurrency mining services provider Argo Blockchain (ARB) estimates that its current annualised revenues are $6.2m (£4.8m). Trading is ahead of expectations. Net cash was £15m at the end of November 2018.
Sand U (SUS) says trading is in line with expectations. There has been a reduction in demand for finance for used cars. This means that the loan portfolio is growing more slowly than expected.
Standard list shell Spinnaker Opportunities (SOP) is evaluating opportunities in the cannabis market.
Andrew Hore
Quoted Micro 30 October 2017
NEX EXCHANGE
The government proposal to drop plans to cap housing benefit in the supported living sector to Local Housing Allowance rates is good news for Ashley House (ASH) because the rates would not have been viable. Ashley House has development schemes that could go-ahead following the change of government plans. There could still be other proposals that hamper development in the government paper on funding supported housing that is due to be published on Tuesday but if there are not then Ashley House is in a good position.
Belvedere Capital has subscribed for £31,500 of convertible loan notes in Forbes Ventures (FOR) and the investment is expected to increase to up to £100,000. The initial cash will pay creditors and enable Forbes to issue its interim figures. That is required for trading in the shares to recommence. The interest rate is 1% per month and the conversion price is 0.1p a share. A representative of Belvedere, which is focused on technology investments in northern England, will join the Forbes board as an executive director.
First Sentinel (FSEN) has made a £625,000 investment in standard-listed Curzon Energy (CZN). The shares in the oil and gas company were acquired at the flotation price of 10p each but the share price has fallen back to 8.38p. Curzon has a coal bed methane asset in Oregon.
Middle East-focused investment company Indigo Holdings (INGO) has made four investments, although one of these was earlier this month so it is not included in the balance sheet to the end of June 2017. There was still nearly £241,000 in the bank, prior to investing £10,000 in 3sootjobs, a job search platform in Iran.
Supported housing developer Walls and Futures REIT (WAFR) has been granted membership of the Social Stock Exchange. Management hopes that this will help the company attract investors seeking investments with a positive social impact.
Black Sea Property (BSP) has completed the €10.5m purchase of the UniCredit Bulbank office building in Sofia.
AIM
A management review at Real Good Food (RGD) has uncovered further disappointment and there will be a loss this year. All three divisions are growing their sales with overall like-for-like sales 13% ahead but this is not translating into higher profit. A combination of higher commodity prices and disruption from capital investment. Overheads are being reviewed and Real Good Food is also racking up costs relating to its corporate governance problems. The head office is being moved from London to Liverpool. New banking covenants have been agreed but the further downgrades could mean they come under pressure but the food company has the backing of its three main shareholders.
Investment in European distribution centres and a new UK head office held back the first half progress of musical instruments retailer Gear4Music (G4M) but the benefits will start to show through in the second half. There was a small loss in the first half but a full year pre-tax profit of £2.4m is forecast as European sales build up and margins start to recover.
Stratex International (STI) is holding a general meeting requisitioned by shareholders, including AnglGold Ashanti and Teck Resources, on 1 November. The requistioners, which own 24% of Stratex, want to remove the current chairman and chief executive and block the proposed reverse takeover of Brazil-focused Crusader Resources, which was announced in May. They want former Stratex directors David Hall and Paul Foord to return to the board. The two men run Thani Stratex Resources Ltd, which is 30%-owned by Stratex. Institutional Shareholder Services Inc advises voting against the resolutions. Stratex has the backing of shareholders owning 12.1% of the share capital. Earlier this month, Stratex sold its 13.7% stake in Goldstone Resources for £550,000 (1.6p a share).This was valued in the latest accounts at £950,000.
Datatec (DTC) is dropping its AIM quotation and concentrating on the JSE listing. There has been a lack of interest in the shares in London with non-South African investors trading through the JSE. The cancellation becomes effective on 8 December.
It appears easier to push a piano up a steep flight of stairs than for TLA Worldwide (TLA) to bring out its 2016 accounts. The latest management estimate for publication is before the end of November. Former CFO Don Malter is said to have misappropriated $800,000 of funds over three years. It is unclear if any of this is included in the $6.8m EBITDA adjustment for 2016 that was revealed in June. TLA remains best known for publishing a profit warning at 6.26pm on 23 December 2016. It will be interesting to see whether the accounts are published before this date and time in 2017.
Lombard Risk Management (LRM) had a tough first half but it expects to do much better in the second half and move back into profit. Interim revenues fell by 16% as risk management software sales fell. Regulatory reporting software sales improved. A full year profit of £1.8m is forecast.
Zinc Media (ZIN) has acquired Tern Television Productions for up to £5.45m, with up to £2.35m deferred. Tern made a pre-tax profit of £300,000 on revenues of £5.3m in the year to March 2017. Tern specialises in factual programming. A placing at 0.9p a share raised £3.5m.
Systems1 Group (SYS1) had a poor first half with revenues falling and costs increasing. The market research firm reported a 10% decline in interim revenues to £13.8m and a 70% slump in pre-tax profit to £540,000. There was still £3.5m in the bank at the end of September 2017. Rebranding and reorganisation hampered the business at a time when clients were also holding back spending.
Fox Marble (FOX) has sold the first polished marble slabs from its factory in Kosovo. This sale was part of the agreement to supply Marble Dino. Fox recently signed a three year agreement to supply OM Enterprises in India. An advance payment of $500,000 has been received.
Third quarter trading at broking business Share (SHRE) continued to be strong and revenues were 29% higher compared with the third quarter of 2016. Market share jumped to 13.9%.
A new finance director has reviewed the forecasts for Attraqt Group (ATQT) and problems in timing of contracts have been identified. This means that revenues will be 10% lower than expected in 2017, although there will be organic growth. There was £2.3m in the bank at the end of September.
Hardide (HDD) has raised £2.54m at 1.7p a share in order to fund an increase in reactor capacity. Two additional reactors will be installed in the US and other equipment will be installed in the UK and US. The surface coatings business has signed a framework agreement with a North American oil and gas business. Full year figures will be published on 11 December.
Botswana Diamonds (BOD) expects major developments over the coming months. There is enough cash to last into 2018. An inferred resource is expected to be reported for the Thorny River project before the end of the year. Eight kimberlites have been discovered at the Free State project.
Ascent Resources (AST) is raising a further £1.5m via PrimaryBid.com. Ascent is a regular user of the crowdfunding site. The shares will be issued at 1.66p each. Ascent is awaiting a signature on a government document that will enable it to export gas from Croatia.
Internet gaming software-as-a-service provider GAN (GAN) will benefit from the final approval of a bill in Pennsylvania that legalises real money online gaming. The regulated gaming is expected to start early in 2018.
Cenkos has lowered its revenue expectations for Collagen Solutions (COS) following a trading statement. It has knocked £400,000 off its 2017-18 revenues forecast and trimmed forecasts for later years. A profit is not anticipated until 2019-20. First half revenues of the collagen products supplier were flat.
K&C REIT (KCR) is raising £150m at 100p a share, following a ten-for-one share consolidation. The name is being changed to KCR Residential REIT and a move to a premium listing is planned.
The Ottoman Fund Ltd (OTM) has repatriated cash from Turkey and shut three Turkish subsidiaries. This is an important step in winding up the company returning cash to shareholders. The final distribution will be in the range of 1.36p a share to 1.53p a share.
Stellar Diamonds (STEL) has been granted an environmental licence for the Tongo project in Sierra Leone.
MAIN MARKET
Fuel cell technology developer Intelligent Energy Holdings (IEH) is selling its business and being wound up. Convertible loan note holders are likely to get 65% of the principal of the loan notes prior to their cancellation but ordinary shareholders will get nothing. Cash is likely to run out in November. Meditor Energy is paying £19.5m for the remaining business and this will be used to pay the 65% of principal of the loan notes. A Meditor fund owns 85.5% of these loan notes.
Orient Telecoms (ORNT) is a new standard list company that wants to start a telecoms business in Singapore from scratch. The share price ended the first day at 11p (10p/12p) and it remains unchanged since then. The shares are tightly held so any trading activity could push up the share price, so beware of this lack of liquidity. There does not appear to have been any trading activity, as yet.
Aquila Services Group (AQSG) is acquiring development consultancy and financial modelling services business pod. The business made an operating profit of £162,000 on annual revenues of £1.09m. This fits with the group’s affordable housing services operations.
Andrew Hore
Quoted Micro 24 July 2017
NEX EXCHANGE
Ace Liberty & Stone (ALSP) has raised £10m via a 6% convertible loan note. The conversion price is 71.25p a share and full conversion would be the equivalent of 26% of the share capital. The loan note is redeemable on 23 May 2019. The holder of the loan note has also been granted an option to purchase some of Ace’s properties.
Block Energy (BLOK) has increased its ownership of the Norio onshore oil field production sharing contract in Georgia from 38% to 69% at a cost of $310,000 in cash. The plan is to move to a 100% working interest. Schlumberger estimates that Norio contains 118.7 million stock tank oil initially in place and it has produced 1.9 million barrels. The production is running at 25 barrels per day and the plan is to increase this to more than 250 barrels per day. That could happen within six weeks of the start of a work programme.
African Potash (AFPO) has raised £50,000 at 0.045p a share and appointed Alexander David as its new corporate adviser. This will help to get the trading suspension lifted. Warrants to raise a further £50,000 will last for 90 days from the lifting of suspension. An agreement has been entered with African Agronomix, which is being given the right to acquire 100% of the company’s 70% interest in the Lac Dinga project in the Republic of Congo.
NQ Minerals (NQMI) has appointed Beaumont Cornish as its provisional nominated adviser for a proposed move to AIM. NQ Minerals has secured a $7m loan facility from the RIVI Opportunity Fund and this funds the final payment for the Hellyer gold mine in Tasmania. A gold purchase agreement means that 14% of the first 22,000 ounces of payable gold and 7% of the amount in excess of that figure has to be sold to RIVI.
The joint venture between a 40%-owned subsidiary of food and logistics company AfriAg Global (AFRI) and LGC Capital, which is quoted on TSX, is acquiring a 60% stake in South Africa-based House of Hemp, which has a long-term lease on the only certified indoor cannabis growing facility. The joint venture is paying nearly C$20,000 and C$37,000 a month for six months. The joint venture will also secure C$4.9m to scale up production. David Lenigas is chairman of both joint venture companies.
MiLOC Group Ltd (ML.P) has raised £166,000 at 28.5p a share.
AIM
Audio visual products distributor Midwich Group (MIDW) says that the weakness of sterling has helped it to grow and the recently acquired Spanish business has done better than expected. This has led to upgrades for the next three years. Investec has raised the 2017 earnings forecast to 21.3p a share. Cash generation remains strong and the net debt forecast has been reduced to £20.2m. The interim figures will be reported on 12 September.
Regenerative medical devices developer Tissue Regenix Group (TRX) is acquiring CellRight Technologies, a US-based developer of bone processing and soft tissue products, for an initial $25.9m (£19.9m) with an earn-out of up to $4.1m (£3.1m) depending on revenues. The bone technology widens the group product range from a pure focus on soft tissue products. The deal also includes a US manufacturing facility. CellRight has launched 13 products since 2012 and more are due in the second half of 2017. The products are sold through distributors. In 2016, revenues were $5.42m and the gross margin was 62%. Two-fifths of revenues were from spine products. In the eleven months to December 2016, Tissue Regenix revenues were £1.44m. Tissue Regenix raised £40m at 10p a share and the additional funds will finance the growth of the enlarged business. All but one of the directors has subscribed for new shares. Management believes it is possible for the group to move into profit by 2020. Tissue Regenix plans to launch seven products over the next two years.
Qannas Investments Ltd (QIL) is using $8m to tender for 12.9% of the share capital at $0.90 each. There are not enough distributable reserves to pay a dividend of this size.
Transport optimisation software and services provider Tracsis (TRCS) has won a multi-million pound contract with a UK rail operator. The contract will last four years and includes the renewal of some existing licences. There should be recurring revenues after the four year period. There will be no contribution in the year to July 2017.
Tristel (TSTL) says that sales in the year to June 2017 were 17% higher at more than £20m and pre-tax profit is going to be more than 10% higher than forecast. The pre-tax profit is expected to be £4m. The growth is predominantly from international sales.
Crop enhancement technology developer Plant Impact (PIM) says that full year revenues will be between £8.5m and £9m, up from £7.2m the previous year. This is despite the cancelation of shipments of Veritas to Brazil. Contract discussions about Veritas with Bayer in Brazil are continuing and they may take some time. However, new buying arrangements are expected to help 2017-18 revenues reach £13m. There is £3.2m left in the bank but a further £2m is being raised at 31p a share with the possibility of a further £2m. This cash is required to finance R&D.
IP Group has raised its all share offer for Touchstone Innovations (IVO) but technology business developer says that the offer of 304p a share, based on an IP Group share price of 137p, is still below its NAV of 312p a share.
EQTEC Group (EQT) is in talks to acquire the waste-to-energy technology subsidiary of its majority shareholder, EBIOSS. EQTEC will pay for the business in shares and it will also need to raise more cash for working capital. Due diligence is being undertaken.
TV programmes producer Zinc Media Group (ZIN) expects to make EBITDA of £300,000 in the year to June 2017. The business has been restructured and starts the new financial year with a strong base. There is a commissioned TV slate of £6.5m for this year.
Security technology supplier Synectics (SNX) reported a 5% increase in revenues and a rise in gross margins, which enabled the interim pre-tax profit to increase by £1m to £1.3m. The oil and gas sector is showing signs of recovery and the order book is worth £33.7m. There is net cash of £1.8m. A full year profit of £3m is forecast.
Inland Homes (INL) increased its completions by 28% to 188, helped by the development of the company’s in-house construction team. In the year to June 2017, revenues will fall from £102m to £90m, although this excludes the revenues from two land sales.
First Property Group (FPO) has launched a new fund which could double third party assets under management. Fprop Offices LP has eight institutional investors and will invest in office blocks and business parks over a seven year term. So far, £182m has been invested in the fund, including £3m by First Property. A loan to value of up to 30% is allowed. This new fund will not pay recurring management fees and instead First Property will take a share of any profit.
Parity Group (PTY) continues to increase its exposure to consultancy activities. WH Ireland has trimmed its revenues expectation for this year but has maintained its pre-tax profit forecast at £1.6m.
Pembridge Resources (PERE) is raising £2.5m at 1.6p a share as part of the planned move to a standard listing.
MAIN MARKET
World Trade Systems (WTS) has dispatched a circular to shareholders in order to gain retrospective approval for loans from Kudrow, which is deemed to be a related party. This is part of the process of the re-application for a standard listing. Kudrow has waived its right to interest and there is an intention to convert the remaining loan of £860,000 into shares.
Bluebird Merchant Ventures Ltd (BMV) says that work has started on reopening the Gubong mine in South Korea.
Andrew Hore
Quoted Micro 22 May 2017
NEX EXCHANGE
London and south east England residential property developer St Mark Homes (SMAP) says it will in the immediate future focus on homes for sale for less than £600,000, because this is the London help to buy limit. In 2016, revenues fell from £3.1m to £1.34m but the unchanged contribution from joint ventures and a release of negative goodwill of £150,000 – a non-cash item – meant that pre-tax profit improved from £549,000 to £652,000. There is still negative goodwill of £137,000 on the balance sheet which is likely to boost a future financial year. A lower tax charge helped earnings per share to rise from 14.8p to 16.6p. Total dividends were 11% higher at 5p a share. There was a cash outflow from operations in the period. The NAV is £5.8m, following a share issue that raised £690,000 net of costs via an open offer to existing shareholders. That is 131p a share. Finance director Sean Ryan acquired 4,912 shares at an average price of 94p each.
Markets operator WMC Retail Partners (WELL) benefitted from an increased valuation of its Luton market but trading was down on the previous year. In 2016, revenues dipped from £4.31m to £4.23m, including £100,000 of consultancy revenues, and a pre-tax profit of £13,000 was turned into a £58,000 loss. WMC is on course to reopen its Cornish site under the name Cornucopia in July.
Property developer Formation Group (FRM) moved back into profit at the interim stage based on continuing operations. Revenues doubled from £10.2m to £20.2m, while an operating loss of £84,000 was turned into a profit of £48,000. The corresponding period also included a £1.08m write-back of loans secured on past properties. There was £1.58m in the bank at the end of February 2017. The NAV was £10.4m.
Block Energy (BLOK) says that Schlumberger has completed the acquisition of three production sharIng contracts in the Republic of Georgia that are near to Bock’s own interests. This indicates the interest in the region. Roger McMechan has been appointed as technical manager for Block’s interests.
Investment company Early Equity (EEQP) increased its interim loss from £46,000 to £67,000. The NAV fell from £770,000 to £639,000 at the end of February 2017. The value of investments in BWA Group and Alpha Prospects declined and the investment in Devilfish Poker was written off, although it is hoped that there could eventually some value to the shareholding. Yicom Global, a healthcare products supplier primarily focused on China, has been increasing its number of sales agents and sales.
Coinsilium Group Ltd (COIN) says that nano-payments company SatoshiPay has linked up with PayPal so that 200 million users could potentially use its service. Coinsilium has a 12.1% stake in SatoshiPay.
Milamber Ventures (MLVP) has paid £75,000 for a 15% in Essential Learning, which provides apprenticeship training. The UK Apprenticeship Levy is expected to generate £2.8bn to be invested in training. In the nine months to April 2016, revenues were £616,000 and lost nearly £30,000. Share placings at 16p a share and 20p a share raised a total of £75,000.
Wheelsure Holdings (WHLP) has raised £500,000 at 1p a share and it hopes to raise a further £50,000. Management says that the economic climate has delayed sales of its Tracksure rail safety components and Wheelsure is short of cash to develop the business. The cash is needed for marketing, product development and patent protection. There are trials of products in process. Wheelsure is focusing on generating more sales from existing customers while targeting longer-term sales from new customers.
Karoo Energy (KEP) has raised £465,000 at 3p a share. These investors will receive a warrant exercisable at 6p a share for each share they subscribed for. The warrants last for 36 months. The cash will be used for shale gas exploration in Botswana.
AIM
A strong end to the financial year means that Bilby (BILB) expects to report EBITDA of at least £3.6m, compared with a forecast of £3m. The building services provider says that demand was strong at the end of the financial year with some work starting earlier than expected. There is a cash balance of £2.5m. The figures for the year to March 2017 will be reported before the end of June.
Mortice (MORT) has sparked another profit forecast upgrade following a trading statement. House broker finnCap has increased its 2016-17 pre-tax profit forecast from $4.3m to $5m and next year’s forecast has been raised from $6.2m to $7m. Revenues are better than expected and costs have been kept under control. Net debt was $13.6m at the end of March 2017. The facilities management and security divisions both generated much higher revenues.
Gemfields (GEM) has received an unsolicited bid from 47.1% shareholder Pallinghurst Resources. The offer is not generous. Pallinghurst is offering 1.91 of its shares for each Gemfields share. That is equivalent to 38.5p a share or a total value of £211.5m.
Veltyco Group (VLTY) did even better than expected in 2016. Revenues were 7% ahead of forecast at €6.1m. Underlying pre-tax profit was €1.74m and Northland forecasts a 2017 profit of €4.27m, helped by recent acquisitions. The online gaming marketing business has started 2017 strongly.
RNA therapeutics developer Silence Therapeutics (SLN) has gained a European Patent Office grant for its chemical modification technology and expects to use this patent to generate revenues from specific medicines that are already undergoing clinical trials.
A recovery in oil and gas demand has helped Hardide (HDD) in the first half. Revenues increased by 59% to £1.51m. The underlying operating loss fell from £1.02m to £720,000. Production is building up at the new US facility. Sales are yet to come through from the approvals already given by Airbus Group. A $100,000 order has been received from General Electric.
LightwaveRF (LWRF) reported a slightly reduced interim loss on revenues that grew from £804,000 to £1.17m. The loss fell from £384,000 to £333,000. The home automation business has developed technology and it needs to generate higher sales in order to move into profit. A partnership with Google in the voice control area has propelled the share price upwards.
ImmuPharma (IMM) says that the latest clinical trial results show that Lupuzor, a potential treatment for Lupus, has a robust safety profile. The phase III trial of 200 patients has been going on for 52 weeks and the full results should be available in the first quarter of 2018.
Tiso Blackstar Group SE (TBGR) is selling its 22.9% stake in industrial holding company KTH back to the company. The payment of around £86m will be paid over 19 months with £7m due before the end of 2017 and the rest by the end of 2018. Tiso Blackstar will repay its debt of £23m and a special dividend of £2.3m. The rest of the cash will be reinvested in media investments. There are plans to move the listing in South Africa from AltX to the Main Market. The company is also moving its registered office from Malta to the UK.
Management has announced a potential bid for recruitment company InterQuest Group (ITQ) but the independent directors are not impressed. Chisbridge Ltd is offering 42- a share. The two independent directors say the offer undervalues the company.
Brave Bison (BBSN) has approached Zinc Media (ZIN) and merger discussions are underway. Herald Investments has stakes in both companies.
Edenville Energy (EDL), which operates the Rukwa coal project in Tanzania, has signed a letter of intent to supply 1,000t of coal/month and this could increase to 7,000t/month. This should hopefully be followed by a formal coal supply agreement so that deliveries can start in July.
Tissue Regenix (TRX) is in talks to acquire US-based regenerative medicine company CellRight Technologies.
MAIN MARKET
Flying Brands Ltd (FBDU) says that the prospectus relating to the acquisition of kidney stone analysis company Stone Checker Software has been approved by the authorities. A placing has raised £550,000 at 3p a share.
Andrew Hore