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Andrew Hore – Quoted Micro 23 March 2020

AQUIS STOCK EXCHANGE

Gin and spirits supplier British Honey Company (BHC) is using spare capacity in its distillery to produce # alcohol sanitisers. There is a shortage of sanitisers due to the coronavirus and HMRC has given permission for British Honey to produce denatured alcohol. The sanitisers are made with 70% alcohol and extracts of honey and green tea. Longer-term, the strategy is to buy other spirits brands to use spare capacity. British Honey started off as a honey producer and moved into craft spirits infused with honey in 2017. It has a computer-controlled, 1,000-litre capacity still and bottling facility with a capacity of 1.5 million bottles a year. Ingredients can be tracked. There has been £4m invested in this infrastructure. The existing products use a small proportion of this capacity. The company also produces spirits on behalf of third parties. Discussions have begun with some potential acquisitions. British Honey joined Aquis Stock Exchange at the beginning of the week and raised £4.25m (£3.88m after expenses) at 110p a share. Advanced assurance of eligibility for the Enterprise Investment Scheme has been obtained. The initial market capitalisation was £10m. Cairn is corporate adviser and Stanford Capital Partners is broker.

Sativa (SATI) is launching a cannabigerol (CBG) and alcohol-based hand sanitiser. CBG is thought to be effective as an antibacterial product and could combat superbugs.

Energy supplier Good Energy (GOOD) reported better than expected 2019 pre-tax profit. Underlying pre-tax profit still dipped from £2.3m to £2.1m due to lower gross margins. Profit is expected to bounce back to £3.1m in 2020. Both business and domestic customers were higher last year. The total dividend has been increased from 3.5p a share to 3.7p a share. Net debt was £39.2m at the end of 2019.

Brewer Shepherd Neame (SHEP) has decided not to pay the interim dividend of 6p a share announced the week before. The sharp downturn in trading and subsequent closure of pubs due to COVID-19 means that Shepherd Neame is also cutting capital investment and the board is taking a one-fifth cut in pay. Rent receipts from tenants were suspended from 16 March.

KR1 (KR1) has generated $168,000 from selling ATOM, taking the total raised from disposals to $290,000. It still holds nearly 17,000 ATOM.

Sheltered housing developer Walls and Futures REIT (WAFR) has outperformed its benchmark for a third year in a row. The MSCI UK Residential index increased by 4.4% in 2019, while Walls portfolio increased by 23%.

BWA Group (BWAP) says that its subsidiary has been awarded an exploration licence for an area known as Dehane in central Cameroon. The focus is rutile sands and other minerals. The permit is for three years and the financial commitment in year one is £275,000, followed by £207,000 in each of the next two years. Tri Castle Investments is subscribing £100,000 at 0.5p a share.

First Sentinel (FSEN) has raised £389,000 at 20p a share for working capital. VI Mining (VIM) raised £56,000 via a placing at 15p a share that was curtailed because of COVID-19. Further cash will be raised in the future.

Eastinco Mining and Exploration (EM.P) has secured a $200,000 facility from Augustin Corp, which is owned by a trust related to Eastinco executive chairman Charles Bray. The annual interest rate is 6 percentage points above commercial lending rates and the facility lasts for up to 18 months.

SAPO (SAPO) is holding a general meeting on 14 April to gain shareholder approval for increasing the share capital. Executive chairman Dr Keith Harris has been issued 20 million shares at 1p a share. The consideration will be paid by the end of 2024.

Belvedere Leisure Resorts (BELV) believes that once normality is resumed it can accelerate its resort development and deliver phase one on time.

Dozens Savings (DS07) says that 795 investors have subscribed for company bonds.

Trading in Dana International (DANA) shares remains suspended. The property investor is still trying to gain full information about share transfers.

Christian Taylor-Wilkinson has become interim chief executive of Altona Energy (ANR) following the resignation of executive chairman Qinfu Zhang.

AIM

Sales of COVID-19 tests by Novacyt (NCYT) continue to accelerate. It has received orders worth more than £8.7m in a six-week period. Manufacturing capacity is being increased.

Synairgen (SNG) is about to start a phase II trial for SNG001 for the treatment of an initial 100 patients with mild-moderate COVID-19. Initial results should be available by the summer. SNG001 is inhaled interferon beta, which has shown benefits in the treatment of SARS. The existing COPD phase II trial has been paused, but initial results suggest that there is clinical benefit.

Best of the Best (BOTB) would have been in trouble a decade ago when it generated its competition entries from airports and other areas of high footfall. Having gone online, the competitions organiser has continued to prosper. Additional marketing investment has helped the 2019-20 performance to be above expectations. The pre-tax profit forecast for the year to April 2020 has been raised from £2.6m to £3m.

Payment systems provider PCI-Pal (PCIP) has won a contract for its Agent Assist product with a UK government organisation. The annual contract value is £565,500.

Manx Financial (MFX) is buying back the 12.94% shareholding owned by Aaron Banks. Manx intends to pay £1.61m for the shares and then cancel them. This cash will become a loan to Manx and an existing £483,500 convertible will be added to the sum. Banks has requisitioned a general meeting at iodine manufacturer Iofina (IOF) in order to remove Lance Baller from the board and become a director himself. Banks does not intend to make a bid for the company.

Mobile payment services provider Bango (BGO) is still set to move into profit in 2020. End user spend doubled last year.

Indigovision (IND) is recommending a 405p a share cash bid from Motorola Solutions. This values the video security technology company at £30.4m. In 2019, pre-tax profit was $1.3m.

MJ Hudson (MJH) grew organic revenues by 12.5% in the first half. The asset management services provider has net cash of £20.1m following last year’s flotation. The acquisition of Meyler will expand the range of services provided in the US. The customer base is predominantly long-term and closed ended funds. A full year pre-tax profit of £1.1m is forecast.

Big Sofa Technologies (BST) has put itself up for sale and trading in the shares is suspended. The video and data analytics technology developer needs additional cash and it is difficult to raise funds in the market when there is so much uncertainty. The company expects proposals by the end of April.

The Wressle oil field development in north Lincolnshire is set to commence production in the second half of 2020 and Egdon Resources (EDG) has a 30% stake and is operator. Europa Oil and Gas (EOG) and Union Jack Oil (UJO) also have interests. The breakeven oil is estimated at $18/barrel. Production could start at 500 barrels a day. An application has been allowed against North Lincolnshire council for costs relating to delays in gaining a permit.

Diagnostic and precision testing services provider Diaceutics (DXRX) boosted revenues by 30% last year following its flotation. Although gross margins improved, a significant increase in headcount meant that pre-tax profit dipped to £500,000. The initial benefits of the investment in the business are showing through growth in Asia and other regions.

Regional property investor Real Estate investors (REI) increased its dividend by 7% to 3.8p a share. Like-for-like rental income was slightly lower at £16.9m and the weak retail property market led to a 3% reduction in EPRA NAV to 67.4p a share. Loan to value is 46.7%. The Midlands property market is strengthening ahead of the Commonwealth Games in Birmingham. An improvement in NAV to near-69p a share is forecast for 2020.

Xeros (XSG) has signed a joint development agreement with a global commercial laundry business. XFiltra micro-particle filtration technology will be included in the partner’s commercial washing machines. The EU plans to have micro-particle filtration in use by 2026. Xeros is likely to need to raise more cash next year.

Oncimmune (ONC) says NICE has completed a positive review of EarlyCDT Lung and believes that it can help in the early diagnosis of lung cancer.

MAIN MARKET

Trading in the shares of Boston International Holdings (BIH) has been suspended ahead of the proposed acquisition of invoice factoring company Alexanders Discount Ltd, which is based in the South East. Alexanders Discount accounts for the year to November 2019 are for a dormant company and the assets were worth £4. The standard list shell floated in October 2016.

Telecoms services provider Toople (TOOP) says that the integration of DMSL is ahead of plan and it has won two new contracts.

BATM Advanced Communications (BVC) is partnering with Novamed for an at-home COVID-19 diagnostic kit. The kit should be completed within four months.

AIQ Ltd (AIQ) has signed a conditional share purchase agreement for Alchemist Codes, a Malaysian IT services developer. AIQ is paying £2.3m in shares.

Andrew Hore

Andrew Hore – Quoted Micro 3 February 2020

NEX EXCHANGE

Zapp Electric Vehicles plans to join NEX in February. Zapp has developed an electric bike and it is being produced in Thailand. The first production series model was made in September. The flotation will raise cash for manufacturing and marketing the i300 in the European market where cities are promoting electric vehicles. Zapp Scooters Ltd (the previous name) had net assets of £487,000 at the end of September 2018 and most of that was accounted for by an investment in the Thailand-based subsidiary. VSA Capital is corporate adviser.

Hydro Hotel Eastbourne (HYDP) increased its full year pre-tax profit from £193,000 to £282,000. Revenues were 2% ahead at £3.73m, while the cost base was flat. There were lower repair costs and the capital investment of recent years is beginning to pay off. NAV was £3.49m, including cash of £1.11m.

Ananda Developments (ANA) says that investee company DJT Plants has been asked follow-up questions by the government as part of the application to grow more than 0.2% THC cannabis. Sales of hap devices and hapac sachets has recommenced in Italy. The executive chairman has loaned £30,000 to Ananda at an interest rate of 10% a year.

Sativa Group (SATI) has signed a deal with Alliance Healthcare for the distribution of Goodbody Botanicals cannabis-based products through its 10,000 UK high street clients.

Block Commodities (BLCC) has extended its option to acquire Greenbelt Company, which has access to 4,000 acres of farmland in Sierra Leone. Greenbelt also has a licence for medicinal cannabis production and processing. A premium of £10,000 is being paid for a 90-day exclusive option to acquire the company for £4m in shares at 0.1p each, a premium to the suspension price. The proposed acquisition was announced 10 months ago.

Healthcare properties developer Ashley House (ASH) continues to build a pipeline of affordable housing schemes and it has completed six homes for Corby Borough Council. A loss will be reported for the 18 months to October 2019. More cash is still required.

Rutherford Health (RUTH) has given notice to Woodford Investment Management that it expects it to subscribe £7.5m at 176p a share. This will take the LF Equity Income Fund stake to 26.8%. More cash will be required so that a fourth proton therapy centre can be opened in Liverpool. This cash will be spent later this year.

Formation Group (FRM) reported a return to profit in the year to August 2019, although it was down to one-off gains. A loss of £284,000 was turned into a pre-tax profit of £1.27m. There was still an underlying loss. The NAV is £20.9m, including cash of £16.2m. The focus was completing existing property development projects. At the end of 2019, the cash was invested in Irish development projects. Sean O’Brien and Andrew Bennett, who is a director of Rutherford Health, have become directors of Formation.

Gunsynd (GUN) has rolled over its loan notes to Human Brands Inc into one loan note with a repayment date of 20 January 2021. Human Brands’ Japanese whisky called Shinju is being sold by a major US liquor retailer. The plan is to raise more cash and Gunsynd would receive a fee in shares.

Coinsilium Group (COIN) says that IOV Labs Ltd, which owns smart contract platform developer RSK, has subscribed £250,000 at 2.65p a share and the two firms have signed a memorandum of understanding to launch a joint venture in Singapore. This will commercialise RSK’s products in Asia and to promote RIF tokens which power RSK’s platforms. Gibraltar-based IOV owns 6.94% of Coinsilium, while Coinsilium owns 1.95 million RIF tokens. Almon I Holding has increased its stake in Coinsilium to 3.68%.

Black Sea Property (BSP) is acquiring two subsidiaries of European Convergence Development Company (ECDC) plus outstanding debt of €119.2m. Black Sea Property is paying €3.3m. There will also be the purchase of between 28.6% to 29.9%. This adds two development plots.

Lombard Capital (LCAP) made a loss of £131,000 in the last quarter of 2019. It is still attempting to raise cash via a bond issue.

Ganapati (GANP) says that additional regulations in Malta have required additional time for the registration as a Virtual Financial Asset licence. The application will be filed in the first quarter and a systems audit is being carried out. There are plans to apply for software gaming licence in the UK Gambling Commission and for certificates in Sweden, Denmark, Spain and Columbia.

Slater Investments has increased its stake in IFA group AFH Financial (AFHP) from 10.65% to 12.2%.

Early Equity (EEQP) has raised £113,000 at 0.65p a share. There was £174,000 in the bank at the end of August 2019. Management has informed NEX that the company should be classed as an operating company, rather than an investment company with the remaining investments classed as non-core assets. There are still plans to move to the standard list.

AIM

Computer vision technology developer Seeing Machines (SEE) increased first half sales from A$13.5m to A$15.8m. The automotive division has nine ongoing programmes with six automotive manufacturers. Demand for driver monitoring systems will be driven by regulation. The cost of the Guardian fleet equipment has been cut by 21%. Seeing Machines has launched a crew training system for the aviation sector.

Best of the Best (BOTB) has sparked another profit upgrade, following the one in November. The online competitions organiser reported better than expected interim figures and this led to a 18% increase in the 2019-20 pre-tax profit forecast to £2.6m, compared with £2.1m last year, and a 25% jump to £3m in 2020-21. There is currently £4.3m of cash in the bank and a 14p a share special dividend is proposed. That is the eighth since 2014.

Minds + Machines (MMX) is on course to announce a maiden dividend with its 2019 figures. The onerous contract has been sorted out Net cash was $6.6m at the end of 2019.

Cloverleaf 374 has increased its stake in Urban Exposure (UEX) from 9.1% to 12.2%. Invesco trimmed its stake from 15.5% to 14.1%. The ultimate owner is Wellesley Group Investors. The board is still reviewing proposals for the future of the property finance provider.

Open Orphan (ORPH) is raising at least £5m via a placing and subscription at 6.1p a share.

MAIN MARKET

Trading in the shares of Baskerville Capital (BASK) on the standard list has been suspended following the announcement of the proposed acquisition of Oberon Investments, which owns smaller company investor MD Barnard. The plan is to move to NEX. An initial 7.83% stake has been acquired for £851,000 with a commitment to subscribe a further £351,000 by the end of April. The acquisition of the rest of Oberon will be paid in Baskerville shares. The deal could be completed by the summer.

Smaller company-focused telecoms services provider Toople (TOOP) has increased its full year loss from £1.4m to £1.67m. In order to build scale, Toople plans to acquire DMS Holding for £1.56m, including £460,000 in cash and 1.05 billion shares. This is a cash generative business and there are potential cost savings. That should offset some of the enormous cash outflow from the existing Toople business. A placing at 0.1p a share will raise £1.2m gross.

Hemogenyx Pharma (HEMO) is raising £650,000 at 1.8p each. This cash will finance further development of the company’s therapies and treatments for blood diseases.

Haynes Publishing (HYNS) increased interim revenues by 4% to £19m with the growth coming from digital. The publisher’s pre-tax profit was 500% ahead at £1.2m. The formal sale process continues.

Standard list shell Bermele (BERM) is raising £200,000 at 1p a share in order to provide further cash to assess potential acquisitions in the pharma sector.

Andrew Hore

Andrew Hore – Quoted Micro 11 November 2019

NEX EXCHANGE

Ecommerce technology developer Netalogue Technologies (NTLP) is recommending a 11.2p a share cash offer from TrueCommerce, which values the company at £5.73m. That is nearly double the share price of the most recent share deal. Netalogue clients include Transport for London, Greene King and Bunzl. The deal will bring together ecommerce and supply chain software in one platform and provide cross-selling opportunities. US-based TrueCommerce is a global connectivity business, which also has a B2B client base. The UK part of the business has revenues of £13.8m, but it is losing money. The group as a whole has revenues of $95.2m and made a net loss of $157,000. In the year to March 2019, Netalogue made a pre-tax profit of £300,000 on revenues of £1.35m. There should be potential cos savings from duplication of development spending and overlapping roles.

AFH Financial (AFHP) is acquiring the client portfolios of Warwickshire-based Groom Associates from the two retiring advisers. The initial cost is £321,000 and a further £294,000 could be payable depending on the performance of the acquired assets over 26 months.

AfriAg Global (AFRI) is selling its African operations and consolidating 100 shares into one new share. It can then concentrate on cannabis business Apollon Formularies.

Proton beam therapy firm Rutherford Health (RUTH) grew interim revenues from £197,000 to £2.5m, but the loss increased from £9.17m to £14.9m as the initial proton beam therapy centres get up and running. Since August, a further £12.5m has been raised and a £20m debt facility agreed. The focus is building up patient numbers for the three fully operational cancer centres. At the end of October, 412 shares were traded at 245p each. There is still the Woodford share overhang.

Two months after floating World High Life intends to consolidate every ten shares into one new share. The investment company plans to acquire businesses involved in medicinal cannabis and related products, including nutraceuticals and cosmetics. World High Life has announced plans to acquire Love Hemp in return for £4m in cash and the issue of 30 million (existing) shares. A further £2m could become payable in the next three years depending on the achievement of turnover targets.

Trading in Black Sea Property (BSP) shares has recommenced following its interim results announcement. Interim revenues improved from €272,000 to €312,000, but there was a €1.9m write-down on investment properties. The overall loss was €2.58m. NAV has fallen from 0.95 cents a share to 0.75 cents a share over a six months period.

Eight Capital Partners (ECP) has converted the €2m it is owed by Finance Partners Group into shares that take its stake in the investment company, which has an investment in Italy-based Avantgarde Group, to 40%. Avantgarde owns inventory finance fintech company Supply Me (www.supplyme.tech), which may list on the London market. Eight Capital Partners has paid £1,500 to John Treacy, one of its directors, for a further 30% of Epsion Capital, giving it 100% ownership. It has also invested a further £95,000 in the company, which is applying to the FCA for full regulatory status.

VI Mining (VIM) says that talks with the vendors of the Minaspampa and Rosario de Belen projects are likely to end with them taking back the projects because there is still $42.4m of the payment outstanding. VI will focus on generating cash from tolling operations. David Sumner is waiving the $1.61m of salary owed to him. Sumner, who already provides loans to the company, is raising money via a security token offering and cash raised will be used to finance VI.

Former NEX-quoted company MESH Holdings (MESH) is proposing to gain admission to the standard list. There is a timing extension to the acquisition of AI business Sentiance and the acquisition of additional shares and the exercising of an option has taken the Sentiance stake to 16.8%. The acquisition of a majority stake is dependent on ZASAi and related interests not having to make a bid for MESH after they receive shares in return for the Sentiance stake. MESH will then own 80.1% of Sentiance and be able to issue a prospectus for the listing.

AIM

In the year to June2019, Frontier IP (FIPP) made an unrealised profit of £3.85m on its investee company portfolio, up from £2.06m last year. NAV was £17.6m at the end of the year. A placing has raised £3.8m at 50p a share. This will help to develop and commercialise investee companies.

Rose Petroleum (ROSE) is acquiring a 10% of Captiva Energy Holdings II (CEH) Inc’s 89.5% net working interest in the 317-acre McCoy lease in Colorado. It will also have an option to acquire up to a further 80% of that net working interest. CEH is owned by the chairman and chief executive of Rose. Drilling should happen within one year and there are discussions about a funding partner. Rosehas raised£1.25m at 1.1p a share to provide finance to develop assets. This is expected to be the first in a series of deals. The Morton family trust has taken a 3.84% stake in Rose.

Zoo Digital (ZOO) was hit by a faster than expected decline in Blu Ray and DVD business, but the core localisation and dubbing business did grow its revenues. A stronger second half is expected, and Zoo should return to profit this year. New streaming services from Apple and Disney provide a strong back drop for demand.

Shares (SHRE) subsidiary The Share Centre won two awards at the Shares Awards 2019. They were best stocks and shares ISA provider and best customer service.

Competitions organiser Best of the Best (BOTB) is trading ahead of market expectations. This has sparked a 2019-20 profit forecast upgrade of 16% to £2.2m. The interims will be published on 30 January.

Faron Pharma (FARN) has raised £7.48m at 190p a share. This will finance the clinical programme for potential cancer treatment Clevegen.

Defenx (DFX) is seeking to cancel its AIM quotation. Strand Hanson will continue as nominated adviser until the cancellation. BV Tech, which owns 67.1% of Defenx, will vote for the cancellation.

LIDAR wine sensor technology developer Windar Photonics (WPHO) has been hit by the slow conversion of interest into orders. Revenues in the ten months to October 2019 were €1.2m. Full year revenues will be below expectations. There is limited working capital available. BDO resigned as auditor during October. A share swap has left the interests of Windar director Jorgen Jensen with a 11.2% stake and O-Net Communications with 4.5%.

MAIN MARKET

Nanoco (NANO) has entered into early discussions with potential buyers of the company. This has sparked a review of strategic options for the business. That includes potential additional funding. There are also talks with potential customers in the displays and infra-red sensing markets.

InnovaDerma (IDP) executive chairman Haris Chaudry has stepped down the day after the beauty products supplier’s AGM. He has reduced his stake from 28.6% to 0.2%. The shares were sold at 52.4p each. Edale Capital has taken a 9.11% stake. Revenues have grown by 38% in the first four months of the financial year. A new skincare product will be launched in 2020.

Robbie Rayne does not want Gresham House Asset Management to be reappointed as external manager of LMS Capital (LMS) and he and his family intend to vote their 42% shareholding against the reappointment at a general meeting. He wants a return to internal management of the portfolio of assets and a £7.5m distribution to shareholders.

Standard list shell Contango Holdings (CGO) intends to try to raise £1m at 5p a share in order to help finance the acquisition of the Lubu coalfield project in Zimbabwe. Contango has advanced $310,000 to the project. If the acquisition does not go ahead by Christmas Eve, then the money should be returned.

Zenith Energy (ZEN) is planning an all share offer for Nordic Petroleum. One Zenith shares will be offered for every 100 Nordic shares. This will require the issue of up to 9.1 million shares. Nordic is involved in heavy oils in Canada. It has tax credits in Norway and a legal claim against a UK party, the rights to which will be retained by Nordic shareholders. A prospectus has been approved for an issue of up to €25m of Euro Medium Term notes at par.

Andrew Hore

Andrew Hore – Quoted Micro 6 May 2019

NEX EXCHANGE

In 2018, Newbury Racecourse (NYR) increased revenues by 8% to £19.3m. This was despite lower race course attendances because of two abandoned days of racing. Underlying pre-tax profit jumped from £188,000 to £568,000. The NAV was £50.7m at the end of 2018. There was a further £3.25m payment from David Wilson Homes, which helped to finance capital investment.

MetalNRG (MNRG) has entered into heads of terms with AIM-quoted Mkango Resources so that it can earn up to 75% of the Thambi licence in Southern Malawi. The licence allows exploration for uranium, tantalum and niobium. MetalNRG has to spend $500,000 in the first 12 months and then a further $700,000 in the next 12 months. A further $800,000 has to be spent in the third year to earn the full 75%. The Kyrgyz Republic has banned uranium exploration and mining and the farm-in agreement for the Kamushanovskoye uranium deposit has been suspended.

Secured Property Developments (SPD) had a NAV of £554,000 at the end of 2018. There is £584,000 in cash on the balance sheet.

High Growth Capital (HASH) has raised £4.99m after expenses via a placing at 1.75p a share with Mirador FZE, which also has warrants to subscribe for 300 million shares at 2.5p each until the end of 2019. If the High Growth Capital share price closes above 4p for five consecutive days, the warrants have to exercised or they will lapse. Mirador has a 14.2% stake. Mike Power has been appointed as a non-executive director.

Sativa Investments (SATI) has opened the first Goodbody and Blunt centre in Bath. The centre will sell cannabidiol products and have a café area.

V22 (V22O) is asking shareholders to approve the cancellation of the NEX quotation 31 May, after nearly 13 years on the market. The art investor and studio space provider plans to sell assets and distribute the cash to shareholders. A matched bargains quotation via JP Jenkins is planned for six months after leaving NEX.

Trading in Valiant Investments (VALP) shares has been suspended because it has not produced its annual report.

Queros Capital Partners (BFD) has raised £205,000 in the past two weeks from the issue of 8% unsecured bonds 2025.

The shortlist for the NEX share of the year at the Small Cap Awards 2019 has been announced. The companies are National Milk Records (NMR), Sativa Investments (SATI), NQ Minerals (NQMI), Chapel Down (CDGP), DXS International (DXSP) and Walls and Futures REIT (WAFR) ,which is also on the shortlist for impact company of the year.

AIM     

Capital equipment manufacturer Mpac Group (MPAC) is acquiring Lambert Automation for an initial £15m. UK-based Lambert provides automation equipment to the medical and healthcare markets. Revenues and profit have been declining, but there was an order intake of £24.5m in 2018 and that should help revenues to recover. Revenues were £17.9m in 2018. There is potential earn out consideration of up to £2.5m. Mpac’s own trading is in line with expectations.

Park Group (PARK) says that trading was better than expected in the second half of its financial year, but there were additional costs and the effects of accounting changes. Edison has reduced its 2018-19 pre-tax profit by 3% to £12.5m. Additional costs next year mean that the profit forecast has been cut from £14.3m to £11.7m.

Tracsis (TRCS) has acquired timetable optimisation software developer Bellvedi for an initial £4m with up to £7.9m more payable over four years depending on performance. Bellvedi made a pre-tax profit of £700,000 on revenues of £1.6m last year. Acquiring the ATTUne software means that less needs to spend on the development of existing Tracsis software. The deal adds 2% to this year’s earnings per share, moving it to 27.3p. Next year’s is enhanced by 7% to 32.3p.

Competitions organiser Best of the Best (BOTB) has published a fourth positive trading update in a year. This prompted finnCap to increase its earnings forecast from 15.4p a share to 18.6p a share. The previous upgrade was in January. The switch to a predominantly online model is paying off. Any upgrades to the forecasts for the year to April 2020 will happen after the 2018-19 figures are published on 20 June.

Allergy Therapeutics (AGY) says that the PQ Grass allergy phase III study will start a year later than expected. It should commence by June 2020. This follows an end of phase II study meeting with the FDA. This means that this year and next year the reported loss will be lower because of deferred spending on the study.

Eight Peaks Group (8PG) plans to cancel its AIM quotation because of limited liquidity. This will save £80,000 a year.

Trading in the shares of property investor Safeland (SAF) will end on 10 May.

MAIN MARKET 

Motor dealer Pendragon (PDG) is selling two Jaguar Land Rover dealerships in California. This is expected to generate around £60m of cash, although £6.9m of profit contribution before central costs will be lost. However, Jaguar Land Rover has right of first refusal.

Papillon Holdings (PPHP) has appointed Novum as broker and it has committed to invest £300,000 in convertible loan notes. The planned purchase of a 50% stake in used car market focused fintech company Pace Cloud.

Ross Group (RGP) has reported its 2018 results, but these are before the completion of the Archipelago Aquaculture which happened early in 2019. Revenues fell from £335,000 to £60,000 and a profit of £57,000 was turned into a loss of £250,000. That is partly down to costs relating to the acquisition of Archipelago Aquaculture.

Thalassa (THAL) received acceptances of 18.5% of the share capital in its bid for Local Shopping REIT (LSR) and this offer has lapsed. Thalassa owned or had acceptances of 39.3%.

Standard list shell Bermerle (BERM) went to a 50% premium on the first day of trading. However, the bid/offer spread of 1p/2p means that investors could only sell at the 1p a share placing price. The company is seeking a pharma acquisition. The areas that Bermele is assessing include diabetes, cancer and mental health. It is also looking at personalised medicine.

Standard list shell Auctus Growth (AUCT) had £920,000 in the bank at the end of 2018. Fellow shell daVictus (DVT) had £355,000 in the bank at the end of 2018 and it has agreed to buy the rights to a restaurant concept from Typical Dutch NV for £100,000. The Havana Rolled Cigar Music Café concept has been developed at a site in Aruba. Spinnaker Opportunities (SOP) has also secured a possible acquisition in the form of Kanabo Research, which is a medicinal cannabis oil company. Kanabo is developing over the counter products and has distribution rights to a vaporiser. Spinnaker had £1.04m in the bank at the end of 2018.

Trading in the shares of Tex Holdings (TXH) and Avocet Mining (AVM) has been suspended because they have not published 2018 accounts.

Andrew Hore

Andrew Hore Quoted Micro 25 February 2019

NEX EXCHANGE

Western Selection (WESP) has reported a 22% decrease in NAV to 75p a share, due to the decline in smaller quoted company share prices. The NAV has recovered to 79p a share. The investment in Swallowfield (SWL) declined by nearly one-third and the value of the Bilby (BILB) stake fell by two-fifths in the six months to December 2018. Net debt was £1.25m at the end of 2018. The interim dividend is maintained at 1.1p a share.

Early Equity (EEQP) has acquired a 60% stake in MEI Home, a ecommerce platform for household, health and food products, for £282,000. The Malaysia-based business was profitable in the first financial year. The founder will retain a 40% stake and he also owns 6.12% of Early Equity. He also promises that annual pre-tax profit will be at least £95,000 in each of the next two financial years.

Tectonic Gold (TTAU) has taken a 50% stake in a joint venture with Vast Mineral Sands covering diamond mining concessions at the government-owned Alexkor diamond mine in South Africa. This should generate cash, through planned production of 900 carat per month, to invest in other projects. Tectonic is paying $650,000 in shares at 2.2p each. A year long research study has confirmed that there is an interaction of two styles of mineralisation at Mount Cassidy prospect in Queensland, Australia. There is stratabound copper and zinc, gold and silver mineralisation and epizonal to epithermal gold and silver mineralisation.

MiLOC Group Ltd (ML.P) has extended the life of its convertible bond by one year to 19 January 2020. The annual coupon increases from 6% to 7.2%. The conversion into shares can take place if an alternative quotation on a recognised stock exchange is secured.

First Sentinel (FSEN) has completed a £4m bond issue. These 7% bonds 2023 are due to start trading on NEX.

AIM  

Michelmersh Brick (MBH) has made its first acquisition outside of the UK. Michelmersh is paying up to €9.9m (£8.7m) for Antwerp-based Floren and Co in a deal that should be immediately earnings enhancing. A placing raised £5m at 90p a share. In 2018, Floren generated EBITDA of €1.75m on revenues of €5.7m. Michelmersh is planning to increase production levels from 19.5 million bricks a year. The acquisition includes 120 acres of land, of which 60 acres is used in production.

IP legal services provider Murgitroyd Group (MUR) is acquiring Southampton-based Chapman IP for £6.6m and Helga Chapman has been appointed a non-executive director. Net cash was £2.03m at the end of November 2018. Interim pre-tax profit edged up from £1.67m to £1.7m. The interim dividend was increased by 8% to 7p a share. Edward Murgitroyd is retaining his role as chief executive and handing over the role of finance director Keith Young.

Carpets and hard flooring manufacturer Victoria (VCP) continued to sacrifice margins in order to add market share in a declining flooring market in the UK in the second half of the financial year to March 2019. Full year EBITDA should be between £95m-£97m, with underlying pre-tax profit of at least £55m. This is not as much as previously forecast. There are additional inventories ahead of Brexit. Restructuring measures and capital investment should add more than £14m to pre-tax profit for the year to March 2020.

JD Sports Fashion (JD.) has acquired 21.3% of Footasylum (FOOT) and it says it may acquire up to 29.9%. FIL Ltd’s stake has fallen below 5%. Artemis has sold its 5.74% stake.

Angling Direct (ANG) expects to report full year revenues of £42m, up from £30.2m. Three new stores have been added to the group, taking the total to 24. International sales doubled. The full year results will be published on 13 May. Angling Direct is considering the acquisition of Glasgow-based Chapmans Angling Ltd, which is a subsidiary of The Glasgow Angling Centre Ltd.

Egdon Resources (EDR) has competed drilling at Biscathorpe-2 in Lincolnshire. There are signs of an effective petroleum system even though the sands were poorly developed. The reservoir may be better developed to the north of the well. Egdon owns 35.8% of the exploration licence and Union Jack Oil (UJO) owns 22%.

Trinidad-focused oil and gas producer and explorer Touchstone Exploration Inc (TXP) has raised £3.8m at 12p a share in order to finance the 9,000 feet of exploration drilling at Ortoire.

Pelatro (PTRO) has gained a contract to supply its mViva contextual marketing service to Vietnam-based Vinaphone. The deal with the telecoms company should be worth $1.5m over three years. Pelatro gets a fixed monthly fee plus a share of incremental revenues generated. This provides additional confidence that the 2019 revenue forecast of $10.5m can be met. That is expected to generate pre-tax profit of $6m because of the high operational gearing of the business.

SkinBioTherapeutics (SBTX) has raised £1.5m at 16p a share from Seneca Partners. There was £2.52m in the bank at the end of 2018. The cash will be invested in further development of products and commercialise them.

Duke Royalty (DUKE) has provided £10m of royalty finance to recreational vehicle parts wholesaler Miriad Products. The monthly payments are expected to provide a yield the equivalent of 13% a year.

Biopesticide products developer Eden Research (EDEN) has a second approved product thanks to its commercial partner Eastman Chemical Company. Nematicide formulation Cedroz has received authorisation in Malta and Eastman will apply to gain approvals in individual EU member states. The full benefit of these approvals is likely to show through next year.

EKF Diagnostics (EKF) has received US FDA clearance for the use of the Quo-Test glycated haemoglobin analyser in clinical laboratories.

It has been a mixed start to the financial year for Gooch and Housego (GHH) with softer demand in microelectronics, due to trade tariffs, but the second half improvement in subsea cable business has continue. The AGM statement has led to a reduction in the underlying profit forecast for this year from £21.5m to £19m, which is slightly higher than last year’s outcome.

Social housing software provider Castleton Technology (CTP) has acquired its software development partner in India for £350,000 in cash and shares.

eServGlobal (ESG) says that its 35.7%-owned mobile transfer payments joint venture HomeSend increased its average transaction value by 35% in the second half following a change in strategy to focus on account-to-account transactions rather than remittances.

Beximco Pharmaceuticals (BXP) is acquiring eight abbreviated new drug applications in the US from Sandoz Inc. This takes the number of US approved drugs to 14, with four currently being exported to the US.

Haydale Graphene Industries (HAYD) has raised £4m at 2p a share and wants to raise up to £4m more through a seven-for-one open offer closing on 11 March. If these shares are all issued they will account for 93% of the total shares in issue. Haydale needs cash to invest in its inks business as well as to cover continuing losses. Keith Broadbent will become chief executive.

Reach4Entertainment (R4E) has acquired the arts and entertainment advertising agency trading as Sold Out for an initial £3.94m in cash and £250,000 in shares. The total purchase price is dependent on performance in the period from 1 June 2017 to the end of 2021 and is capped at £10m. In the year to May 2018, Sold Out made a pre-tax profit of £1.3m.

Paragon Entertainment (PEL) has sold its current administration offices in York for £550,000. The relocation to other group premises should save £100,000 a year. The cash will pay off the mortgage of £134,000 and reduce the overdraft from £1.04m. The overdraft limit will be cut from £1.2m to £882,000. A creditor owing £168,000 has filed for protection from creditors. Management want to raise additional capital.

Medical devices supplier Inspiration Health (IHC) says revenues for the year to January 2019, will be £15.5m, which is £1m below forecast, and pre-tax profit will be slightly lower than forecast at £1.2m.

Holders Technology (HDT) has more than trebled its full year pre-tax profit of £177,000 thanks to a reduced LED loss and improved profitability at the printed circuit board materials business. There was still a cash outflow from operations. The dividend has been increased by 50% to 0.75p a share.

Arc Minerals Ltd (ARCM) has raised £2.2m at 3p a unit. The unit includes a share and one warrant exercisable at 4.5p each and lasting for 36 months. The cash will finance exploration and development at the Zamsort copper project in Zambia. Arc has also sold its 18.5% stake in Andiamo Exploration for $250,000.

Malvern International (MLVN) has raised £606,000 at 4p a share. This is more than the education services provider originally asked for in order to cover working capital requirements and investment in a new college in Brighton and online course material.

AIM-quoted blockchain and technology investment company Vela Technologies (VELA) is taking advantage of the discount to cash by buying 500,000 shares in cryptocurrency mining services provider Argo Blockchain (ARB) at 3.072p a share. This compares with cash of 5p a share. Vela has 3 million shares in Argo, equivalent to 1.02%. The rest of the shares were bought prior to Argo’s standard listing and cost 8p each, compared with the flotation price of 16p a share. The average cost is 7.17p a share, so the average cost exceeds the value of cash in the business. Argo is refocusing on its own currency mining. Ongoing costs will be cut by one-third, although there will be some one-off cash costs. Net cash is £15m and that is much more than the market capitalisation of Argo.

ReNeuron (RENE) has released early data on three patients in phase I/IIa clinical trial the human retinal progenitor cell product. There have been significant improvements in vision for the patients, but this is a small sample size over a short time. Cash should last until the end of 2019.

Pires Investments (PIRI) has received a requisition notice for a general meeting in order to make changes to the company’s board.

Best of the Best (BOTB) has received tenders for just over 4 million shares, which is 5.6 times the number that it was tendering for. Best of the Best will pay £3.5m for 721,327 shares (485p a share).

FAIRFX Group (FFX) has become a direct participant in the UK faster payments scheme. It is the fourth non-bank to be a direct settling member.

Crossword Cybersecurity (CCS) says Kinnerton Confectionery will be using its Rizikon Assurance secure third party assurance platform.

Former AIM company Lionsgold Ltd (LION) is changing its name to Tally Ltd. Mobile banking app Tally is in beta testing and could be released by the end of February. Once this has been released the company will seek to gain a new quotation. The exercise of warrants, mostly by directors, at 1.2p a share has generated £288,000.

MAIN MARKET 

Packaging group Macfarlane Group (MACF) increased its pre-exceptional profit by one-fifth to £11.2m in 2018. Both distribution, helped by acquisitions, and manufacturing divisions increased their profit contributions. Manufacturing sales grew fastest but margins fell. The dividend was increased by nearly 10% to 2.3p a share. Net debt was £13.2m and there are plenty of unused bank facilities to fund any further acquisitions. The pension deficit was reduced by £2m to £9.8m.

In the six months to December 2018, Avation (AVAP) reported doubled earnings per share thanks to the gain on the sale of a A321-200 aircraft. The NAV is 288p. The aircraft fleet continues to increase, particularly turboprop aircraft. Although full year pre-tax profit is set to rise even more than originally forecast, earnings per share are likely to be flat at 31.7 cents. Next year’s profit will be lower, assuming no aircraft disposals.

InnovaDerma (IDP) reported interims in line with expectations and there are plans for a mid-March launch for Skinny Tan in Boots. This will help the second half performance, which is normally stronger. Full year pre-tax profit is expected to more than double to £1.5m, a downgrade of 10%. Net cash was £700,000 at the end of 2018. A cash inflow is expected in the second half, but fluctuations in cash in terms of working capital requirements, such as Boots order levels, during the period could lead to InnovaDerma deciding to raise more money.

Anglo African Agriculture (AAAP) reported a reduction in turnover from £2.13m to £1.74m in the year to October 2018. Even so, gross margins improved and the pre-tax loss edged up from £550,000 to £573,000. Net cash was £856,000. The company is assessing acquisitions outside of the agriculture sector.

Trading in the shares of daVictus (DVT) has been suspended ahead of finalisation of a deal where the standard list shell will buy the rights to a restaurant concept from Typical Dutch NV for £100,000. This is deemed to require a prospectus before the company can be readmitted to the standard list. The Havana Rolled Cigar Music Café concept has been developed at a site in Aruba. daVictus had £431,000 in the bank at the end of June 2018.

Offshore support vessels operator Gulf Marine Services (GMS) has sent out the document for its requisitioned general meeting on 18 March. Rival Seafox International wants to remove the chairman and appoint three new directors. Ithmar Capital Partners wants to appoint another director.

Andrew Hore

Andrew Hore – Quoted Micro 12 November 2018

NEX EXCHANGE        

Crossword Cybersecurity (CCS) plans to raise up to £2.25m prior to a move to AIM at the end of this year. The cash will be invested in sales and marketing, product development and working capital.

Primorus Investments (PRIM) says that investee company Stream TV Networks has secured a deal with Beijing Optical and Electrical, which will use Stream’s 3D display technology in large flat TV and monitor screens. Primorus has invested £1.4m in Engage Technology, which has 75 corporate clients for its construction software and a further 17 that are contracted but not yet live. Revenues are growing more slowly than hoped. Engage is talking with partners and potential corporate investors.

Angelfish Investments (ANGP) is increasing its shareholding in YBOO from 20% to 35% for an investment of £400,000. A working capital loan of up to £1.5m with an annual interest charge of 10%.

Inqo Investments Ltd (INQO) reported an increase in interim revenues from R7.65m to R8.37m and the loss declined from R4.52m and R4.12m. At the end of August 2018, net cash was around R11.5m. The South Africa-based social impact investor generated the majority of its revenues from Kuzuko Lodge with a contribution from Bee Sweet Honey.

KR1 (KR1) says that its investee company Volt Ltd has raised $2m. KR1 has converted loan notes and has a 7.94% in institutional digital asset custodian Volt valued at $1.4m. The initial investment of £200,000 acquired a 5% stake in September 2017.

MetalNRG (MNRG) has completed the acquisition of the Gold Ridge project in Arizona from Winston Gold for £530,000. The final payment is funded by shares at 1.75p each. The project area includes three former producing mines. There is potential for the discovery of further gold mineralisation.

Auxico Resources Canada Inc (AUAG) has raised $315,000 at 20 cents a share. This cash will fund geological work and the evaluation of opportunities in Colombia.

Healthperm Resourcing Ltd (HPR) is changing its name to SG Recruitment Ltd.

AIM    

Gresham House (GHE) is acquiring investment manager Livingbridge for an initial £30m. Up to £10m more could be payable depending on performance. This deal will help to widen the customer base and provide product development opportunities. The combined group will have assets under management of more than £2bn. A placing raised £11.7m at 448p a share. The deal is immediately earnings enhancing even before cost savings. Gresham House Energy Storage Fund has raised £100m and will invest £57.2m in a portfolio of energy storage assets in development.

Castleton Technology (CTP) increased interim revenues by one-fifth to £12.9m and there was a 5% improvement in earnings per share. finnCap forecasts an improvement in full year earnings per share from 5.2p to 5.9p. The provider of software and managed services plans to pay a maiden dividend for this financial year.

Transportation software and services provider Tracsis (TRCS) has reported figures in line with recently upgraded forecasts. In the year to July 2018, revenues improved from £34.5m to £39.8m, mainly organic growth, while pre-tax profit rose from £7.6m to £8.5m, helped by a one-fifth increase in software sales. There is £22m in the bank to finance further acquisitions.

AdEPT Technology (ADT) has acquired unified communication services provider ETS Communications for £2.5m less net debt at the end of October 2018. This deal will be immediately earnings enhancing. Thebank facility has been increased to £35m in order to fund further acquisitions.

International benefits insurance provider GBGI Ltd (GBGI) is recommending a $1.515 a share cash offer from Elm Bidco. This values GBGI at $131.8m (£101.6m). There has been modest growth in earnings per share since GBGI floated at 150p a share in February 2018. Adividend of 1.4 cents a share was paid in June.

Myanmar-focused social media platform operator MySQUAR Ltd (MYSQ) is investigating into the use of proceeds of two recent fundraisings. Approximately £900,000 was paid out of company funds to former directors and third parties. Staff are being made redundant and additional cash is required. Trading in the shares is suspended. The nominated adviser SP Angel and joint broker Daniel Stewart have resigned. Piers Pottinger has stepped down as a director.

Floorcoverings manufacturer Victoria (VCP) has reassured investors about trading and the share price has started to recover. Victoria is not issuing a bond to refinance its debt because the potential pricing was unfavourable. Invesco has increased its stake to 22.1% and The Spruce House Partnership has built up a 13.6% stake.

Estate agency Purplebricks (PURP) has grown interim revenues in the UK by one-fifth. Trading in Australia is tough, and it is still early days in the US. Net cash was more than £100m at the end of October 2018.

First Derivatives (FDP) increased its underlying interim pre-tax profit by 15% to £10.6m. The interim dividend was 10% higher at 7.7p a share. The software and consultancy company with the fastest growth coming from licences for Kx software.

URA Holdings (URA) has gained EIS approval for the funding for its proposed reverse takeover of personalised digital entertainment content provider Entertainment AI. Complexities of the deal have been solved and documentation is progressing. URA has until 20 December to complete a reverse takeover.

Interim revenues and pre-tax profit at Best of the Best (BOTB) will be better than expected and this has led to a full year pre-tax profit upgrade from £1.4m to £1.6m, which is the same as the year before. The online competitions operator will be hit by the increase in remote gaming duty from 15% to 21% from October 2019. This will mean that 2019-20 forecasts will have to be reassessed.

Polarean Imaging (POLX) says that its phase III non-inferiority clinical trial of its Xenon polariser is up and running. Enrolment should be completed in the second quarter of 2019. A new order has been received to upgrade the polariser at SickKids Hospital in Toronto.

Remote tracking technology developer Starcom (STAR) has signed a deal with a distributor in North Africa covering Helios Advanced and BIO CAN fuel sensors. This year’s group revenues are expected to improve from $5.4m to $5.9m. Starcom has raised £400,000 at 2p a share.

Broadcast software provider Pebble Beach Systems (PEB) has won two new contracts that will underpin forecasts for 2018 and 2019. The two orders have a total value of £2m.

Zoo Digital (ZOO) reported interims in line with expectations. Revenues were 17% ahead at $14.9m and the main growth has come from dubbing services. The loss was slightly higher at $159,000. A major subtitling customer will increase its demand in the second half. The full year, underlying pre-tax profit is forecast to improve from $500,000 to $1.8m.

Recruitment company Kellan Group (KLN) plans to cancel its AIM quotation and the general meeting vote already has backing from the owners of 70% of the shares. The shares are tightly held and liquidity is limited.

Fastjet (FJET) says that it can continue operating in November, but it will require more cash.

Crawshaw (CRAW) has called in administrators to itself and four subsidiaries. Thirty five stores have closed and 19 are still trading. Administrators have also been appointed to Flowgroup (FLOW) because it could not find a suitable acquisition.

MAIN MARKET  

Path Investments (PATH) says it is not proceeding with the farm-in for the Alfeld-Elze II licence having failed to raise the cash it required and reach agreement on the transaction structure. The deal would have led to a move to AIM. Trading in the shares remains suspended.

Beauty and personal care products supplier InnovaDerma (IDP) expects interim revenues to be similar to last year, while full year revenues are expected to increase from £10.7m to £14.4m. finnCap forecasts a rise in pre-tax profit from £700,000 to £1.7m.

Consumer goods supplier UP Global Sourcing (UPGS) reported revenues for the year to July 2018 fell by one-fifth to £87.6m and underlying pre-tax profit decreased from £10.7m to £5.6m. The main decline was due to discount retailers seeking tougher terms and delayed sales to a European retailer. Online sales increased and this helped to maintain margins. Brands include Salter kitchenware and Constellation luggage. The Kleeneze brand is being relaunched. Non-executive chairman Jim McCarthy has acquired 135,000 shares at 39.3p each. Equity Development forecasts a rise in earnings per share from 5.4p to 5.6p, while dividend per share should rise from 2.7p to 2.8p.

Trading in Blockchain Worldwide (BLOC) shares has been suspended ahead of a proposed acquisition of Chorum Group.

Shareholders have agreed to Titon Holdings (TON) moving to AIM on 10 December.

Andrew Hore

  

Ian Pollard: Winnstay Benefits From Agriculture Recovery

Wynnstay Group WYN the first half year to the 30th April was seen as  encouraging as the long awaited upturn in the agricultural sector kicked in and farm gate prices continued to recover, Growth was seen in both divisions and revenue from continuing operations rose by 10.3%, profit before tax  by 15.7% and earnings per share by 13.3%. The interim dividend is to be increased by 5%.

Immunodiagnostic Sys Group IDH  Revenue for the year to 31st March declined by 8% on a like to like basis. Adjusted earnings per share fell by 61% and EBITDA by 28%. Profit from operations was down by 43%. According to the new CEO appointed last November  one good sign for the future is that good progress has been made in restructuring the company

Elektron Technology plc EKT updates that Bulgins order book is significantly stronger with year to date orders at record levels. Half year sales are expected to show a rise of some 8% on last year.

Best of the Best plc BOTB Preliminary results for the year to the 30th April were ahead of management expectations and are described by the company as being solid. Like for like revenue rose by 13.3% and profit before tax by by 5.8%. Online like for like revenue increased by 23% and a special dividend of 4.5p per share is to be paid on the 20th July in addition to the proposed ordinary dividend of 1.5p per share due on the 21st Setpember.

Inspired Energy INSE has continued to build on a strong 2017 and is trading in line with market expectations

 

Luxury villas & houses for sale in the Greek Islands;   http://www.hiddengreece.net

Andrew Hore – Quoted Micro 28 May 2018

NEX EXCHANGE   

Sativa Investments (SATI) has made two investments in the past week. A C$200,000 investment in Rapid Dose Therapeutics Inc has been made prior to a flotation. The company’s QuickStrip fast-dissolving strip technology can be used to deliver medicinal cannabis. The other investment is in Veritas Pharma. A further C$200,000 is being invested in Veritas, which develops and commercialises medicinal cannabis treatments for chronic pain and palliative care.

Gunsynd (GUN) says that Danish software business FastBase Inc is delaying its flotation. An AIM quotation was originally planned but it may come to the standard list. There may also be a corporate transaction. Gunsynd has a 10% stake in Sunshine Minerals, which has announced that the authorities in the Solomon Islands intends to issue a prospecting licence for its nickel project as long as it gains right of access with land owners.

Wheelsure Holdings (WHLP) reported halved revenues in the six months to February 2018. Orders for the company’s rail systems and technology have been disappointing due to tight budgets and admin delays. The interim revenues fell from £104,000 to £46,000.

Walls and Futures REIT (WAFR) raised £80,000 from an open offer at 94p a share.

Capital for Colleagues (CFCP) had a NAV of 41.5p a share at the end of February 2018, down from 43.5p a share one year earlier. The employee-owned business investor invested £324,000 in the latest six month period. There is £789,000 in the bank.

AIM   

Stride Gaming (STR) intends to get rid of its poorly performing social gaming business and concentrate on growing its online gaming operations internationally. Licences are being applied for and Italy should be up and running in the near future. As expected increased regulation and tax are holding back profit. Revenues should grow this year but pre-tax profit is expected to decline from £18.9m to £14.2m and be flat next year.

Watkin Jones (WJG) increased its revenues by 18% to £158.3m in the first half. Pre-tax profit was 12% ahead at £23.6m. Student accommodation developments remain the core but build to let developments will become more important over the coming years. There is even potential for a separate operation focused on build to let. Full year pre-tax profit is expected to be £48.1m.

Sanderson (SND) put in a strong first half performance. The enterprise software provider had an initial contribution from Anisa but even so the like-for-like profit was higher even though like-for-like revenues only edged up. The retail business was the main driver of profit growth and the improved order book, which increased from £2.78m to £8.61m. The like-for-like order book was 16% higher. The interim dividend was increased by 14% to 1.25p a share. Earnings per share rose by 44% to 2.3p a share, helped by a lower tax charge.

Oxford Metrics (OMG) has completed the disposal of its Yotta Surveying business to Ginger Group. The sale of the highways surveying business will generate £1.3m in cash. Oxford Metrics still owns the Yotta software.

GetBusy (GETB) has made a strong start to 2018 with revenues 17% ahead in the first four months of the year.  Stockdale expects the software company to increase its profit from £1m to £1.6m this year.

River and Mercantile has sold its shares in InterQuest (ITQ) and Chisbridge has increased its stake to 51.4%. This comes at a time when InterQuest is seeking to cancel the AIM quotation and investors are being offered 24p a share.

Best of the Best (BOTB) has received the full £4.5m VAT claim from the HMRC. There will be fees and costs to offset against this. On the negative side, HMRC says that the company owes retrospective remote gaming duty for a period of four years.

Frontier Smart Technologies (FST) says tough trading in the second quarter will hit the full year outcome. Expectations have been downgraded to revenues of £34.9m and EBITDA of £800,000. There will be an EBITDA loss of £1.5m in the first half. Excess stock levels hit orders for the digital radio division. Smart audio revenues are expected to grow slower than envisaged originally because of competition in the market. Development spending is being reduced.

Magnolia Petroleum (MAGP) wants to cancel its AIM quotation. The oil and gas producer estimates that it will save £100,000 a year by leaving AIM. The strategy is to sell assets in order to reduce debt.

Clear Leisure (CLP) is raising £600,000 at 0.95p a share. The cash will be invested in the bitcoin data mining business and fund continued litigation.

MAIN MARKET    

Trading in the shares of Path Investments (PATH) remains suspended and the AIM flotation continues to be delayed. The acquisition of a 50% stake in an onshore gas field in Germany is progressing. The 2017 annual report should be published in June.

Fandango Holdings (FHP) has secured two potential factoring and financial services acquisitions. The standard list shell would issue 908.4 million shares for the acquisition. Trading in the shares has been suspended.

Predator Oil and Gas (PRD) joined the standard list on 24 May. The share price edged up from 2.8p to 2.88p. The flotation raised £1.3m to finance the plan to acquire oil and gas assets in Trinidad and Tobago and Ireland.

Bisichi Mining (BISI) has acquired five shops in west Ealing (via a joint venture) for £5.6m. Bisichi and its main shareholder London and Associated Property will each own 45% with the other 10% owned by Metroprop Real Estate. The annual rental income is £140,000 and there is planning consent for 20 flats.

Life sciences company Bioquell (BQE) has sold its defence business for an initial £400,000. Up to £600,000 more could become due depending on winning a particular contract in the next 12 months. This business is lumpy and it made a small loss last year.

WideCells (WDC) is still finalising its 2017 accounts. The stem cell services provider is offering the chance for small investors to invest up to £450,000, via a bookbuild using the Teathers app and that was due to close on 21 May but it will be extended until the results are published. Trading in the shares remains suspended.

Andrew Hore

Andrew Hore – Quoted Micro 18 December 2017

NEX EXCHANGE

Wine and beer maker Chapel Down Group (CDGP) has raised £18.53m at 50p a share and could raise up to £1.47m more via a one-for-35 open offer at the same share price. The latest acceptance date is 5 January. Chapel Down will invest in an additional 500 acres of vineyard land and more money will be put into marketing. The family interests of Michael Spencer have invested in the fundraising. Nigel Wray has invested a further £500,000 but his stake has fallen to 16.5%, prior to the open offer. This year’s turnover is expected to be at least £11.6m and management expects growth to accelerate after the additional investment. New gin and vodka brands have been launched and the Ashford brewery should be up and running by the end of 2018.

Ashley House (ASH) has signed a joint venture with Morgan Sindall to develop extra care and supported living housing. This deal sparked a 55% increase in the share price to 14.75p. Morgan Sindall is paying £4m in total for the 50% stake in the joint venture, with £1.5m of this dependent on certain completion factors. It should all be paid by the end of 2018. The Ashley House housing division will complete two existing schemes and then own 50% of the joint venture, which will develop any further schemes. This additional cash will help to accelerate the growth of this part of the business. There is already a pipeline of potential developments. Ashley House will make an interim loss but expects to profitable for the full year.

e-commerce technology provider Netalogue Technologies (NTLP) reduced its interim loss as revenues grew from £317,000 to £479,000. There has been a lower number of larger projects, particularly in the food and drink sector, and Netalogue would have been profitable without the investment in the company’s technical team. A move towards a SaaS-based model could hold back short-term revenues.

AIM-quoted, spread betting business London Capital Group (LCG) has joined the NEX Exchange Growth Market on 15 December. Glio Holdings Ltd owns 78.1% of London Capital.

Early Equity (EEQP) has made two more investments. It has invested £60,000 in TruSpine Technologies Ltd, which plans to join AIM next year. TruSpine has developed the Faci-LOK and Cervi-FAS minimally invasive spine stabilisation devices and the VOSC catheter atherosclerosis treatment product. The plan is to gain FDA authorisation for Faci-LOK next year and then float. TruSpine is valued at £15m. A £35,000 investment in the profitable corporate finance and asset management business Farina Investments (UK) Ltd has been made ahead of a flotation. Early Equity raised £115,000 at 0.6p a share.

Hydro Hotel, Eastbourne (HYDP) has declared an unchanged total dividend of 21p a share for the year to October 2017.

Lombard Capital (LCAP) says that it is progressing towards the issue of an investment bond that will be quoted on a recognised bond market. There was nearly £60,000 in the bank at the end of September 2017.

Coinsilium Group Ltd (COIN) raised £720,000 at 9p a share and this will be used to invest in blockchain companies and expand the company’s own advisory business. Last June, £250,000 was raised at 2.2p a share. Coinsilium has been appointed as an adviser to token generation event of Hdac Technology AG, which is developing payment platforms for connected devices.

Equatorial Mining and Exploration (EM.P) has raised £5,000 at 0.01p a share and issued further shares for convertible loan notes and warrants at the same price. Valiant Investments (VALP) has raised £34,000 at 0.1p a share. Via Developments (VIA1) has issued a further £50,000 of debenture stock.

AIM

Satellites owner Avanti Communications Group (AVN) has revealed a financial restructuring that could put it on a firm footing. Certainly, without this restructuring the outlook would be bleak. The $557m of 2023 loan notes will be converted into two billion shares, while investors in the 2021 loan notes are being asked to accept and extension of the term and lower income. Annual interest charges would still be $36.6m

Best of the Best (BOTB) says that it expects to pay remote gaming duty and this will knock £300,000 from profit this year and £600,000 next year. This year’s pre-tax profit is forecast to decline from £1.5m to £1.4m, with a further fall to £1.2m in 2018-19. Net cash is expected to be £2.6m at the end of April 2018. The company is still claiming £4.5m of VAT so this could provide a cash boost in the future.

Plant Impact (PIM) is suffering continued delays in demand for its Veritas product in Brazil. A new partnership with Albaugh Brazil will commercialise other Plant Impact products in Brazil. This has sparked the decision to consider putting the company up for sale. Cash is running out and a further £7m would need to be raised to keep the company going well into 2019.

Van Elle Holdings (VANL) has defeated the five resolutions proposed by former chairman Michael Ellis at last week’s general meeting.

Recruitment and outsourcing services provider Servoca (SVCA) reported better than expected full year figures. Pre-tax profit improved from £3.5m to £3.9m. Education and healthcare will be the main growth areas.

Evgen Pharma (EVG) is collaborating with King’s College London to examine the use of SFX-01 as a therapy against ischaemic stroke. Multiple doses will be assessed and this will take nine months. This could lead to a clinical trial that might be funded by a charity organisation associated with King’s College.

Range Resources Ltd (RRL) returned to AIM following the reverse takeover of producing oil and gas assets in Trinidad from Trinity Exploration and Production (TRIN).

Defence equipment and services supplier Cohort (CHRT) had a weak first half but it expects to more than make up for that in the second half. There was a mixed performance with some parts of the business finding trading conditions difficult. The order book is worth £132m. Full year pre-tax profit is forecast to improve from £14.5m to £15.4m.

Savannah Resources (SAV) says that it has discovered high-grades and large intercepts in the latest drilling at the Mina do Barroso lithium project. A maiden mineral resource estimated could be announced before the year end with potential for upgrades from further drilling.

Daniel Stewart expects China New Energy (CNEL) to report a jump in pre-tax profit from £400,000 to £2.6m in 2017. The shares are trading on less than four times fully-taxed 2017 prospective earnings. The company constructs bioenergy plants that convert feedstock into ethanol. The most recently reported order book was worth £28.7m with the orders due to be fulfilled in 2017 and 2018. Demand from China is strong and there is also international business.

Coal bed methane projects developer Tlou Energy Ltd (TLOU) has secured a listing on the Botswana Stock Exchange and trading commenced on 13 December. Tlou raised £2.4m at 11p a share.

Synairgen (SNG) has secured a £5m cash injection from a deal with Pharmaxis, which will take over the development of LOXL2 in fibrotic diseases. Synairgen will also receive 17% of any partnering revenues. This compares with £3m invested by Synairgen in LOXL2. The cash will enable Synairgen to fund the phase IIa study for SNG001 for COPD. The trial should be complete by the end of 2018.

New management has turned around the performance of contract disputes and expert witness services provider Driver (DRV) and it moved back into profit last year. Cost savings have been made and the focus is on profitable business rather than just growing revenues. Cash collection is improving with net debt down to £200,000 and there is likely to be net cash of £2m in one year’s time. This year’s revenues are likely to be flat at around £60m but pre-tax profit should improve from £2.5m to £2.7m.

One month after its previous trading statement IDOX (IDOX) says that an internal audit has found that it should not recognise all the revenues that it originally intended to. This will knock £3m off profit for 2016-17. The software company reported its full year figures in December but the attest full year figures have been delayed until February. Chief executive Andrew Riley is away ill and former boss Richard Kellett-Clarke has taken over on a temporary basis.

Abzena (ABZ) reported interims in line with expectations. Growth came from the chemistry and manufacturing businesses. This is a period of capital investment as various parts of the company move to new facilities. The ADC master services agreement with a US biotech will yield at least $5m in services revenues over the next 12 months. This deal is shared between chemistry and manufacturing divisions.

Surface coatings provider Hardide (HDD) is starting to improve its gross margin as demand improves. There is even some signs of improved demand from the oil and gas sector. Even so, Hardide remains loss-making but it still has not gained any orders from Airbus. It raised £2.5m for capital investment earlier this year. A new reactor will be installed in the US in this financial year and another next year.

MAIN MARKET

Titon Holdings (TON) continues to benefit from strong demand for its window ventilation components in South Korea. The majority of profit comes from South Korea and that is where all the growth came from last year as the contributions from the UK and North America fell. In the year to September 2017, revenues were one-fifth ahead at £28m, while pre-tax profit improved from £2.14m to £2.49m. The dividend growth of 20% to 4.2p a share is ahead of earnings per share growth. A pre-tax profit of £2.81m is forecast for this year.

Avation (AVAP) has secured an initial $100m revolving facility to finance the acquisition of aircraft.

Sealand Capital Galaxy Ltd (SCGL) has secured an agreement with AIM-quoted MySQUAR (MYSQ) for the distribution of its games on MySQUAR’s platform and MySQUAR’s games on the Huawei InTouch platform. This is initially a two year deal.

Standard list shell Stranger Holdings (STHP) says that it expects to complete the acquisition of biogas and renewable energy business Alchemy Utilities. A five-year £20m bond is being raised.

Andrew Hore

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

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