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Primorus Investments (PRIM) says that investee company Sport:80 has delayed its flotation because it has been tidying up its shareholder register. Fintech company Engage Technology is also seeking to float later in 2019 following new product launches. Engage raised £2.6m at £22 a share at the end of 2018, whereas the average buying price by Primorus was £20.03 a share. Investee company, AIM-quoted Greatland Gold (GGP) has published results from the second drilling campaign at Havieron in Western Australia. Every drill hole intersected mineralisation and they extend the overall mineralisation. Drilling will recommence in March. Primorus has raised cash by selling most of the stake in UK Oil and Gas (UKOG) and Primorus was debt free at the end of 2018.
NEX has decided not to suspend trading in the shares of VI Mining (VIM) even though its corporate adviser Daniel Stewart is no longer a member of NEX. VI Mining had little or no notice of its adviser’s withdrawal. A new corporate adviser is being sought.
Milamber Ventures (MLVP) has acquired apprenticeship training provider Astara Training for £16,666 in shares at 9p each. Milamber lost £179,000 in the third quarter and there was £30,000 in the bank at the end of 2018.
Panther Metals (PALM) has announced the initial results of exploration activity at the Bear Lake project in Ontario. There was gold in soil anomalies at four of the five areas tested. Four areas have quartz vein sample assays above 5g/t gold. Two samples had large grade samples. The next phase of exploration is being planned and could start in the second quarter of 2019.
Auxico Resources Canada Inc (AUAG) has signed a deal that could enable it to earn a 70% interest in a joint venture that owns the Palha tantalum property in northern Brazil.
AIM (February 2019 AIM Journal available here)
DP Poland (DPP) is running short of cash and is more than doubling its share capital through a heavily discounted placing raising £5.3m at 6p a share, with the possibility of an additional £500,000. The Domino’s Pizza franchisee for Poland has found competition is getting tougher and growth has slowed. The cash is required to cover losses and open more outlets. Peter Shaw is stepping down as chief executive at the end of June, nearly a decade after founding the business.
Ticketing and queueing technology provider Accesso Technology (ACSO) is reviewing its investment priorities although it says that 2018 figures should be broadly in line with expectations. These will be published on 27 March. A deal fell through and this cost $1.7m. Tom Burnet is moving from executive chairman to a non-exec role. The share price is less than one-third of last year’s high. BlackRock has cut its stake below 5%.
Midatech Pharma (MTPH) has launched a placing and 0.318-for-one open offer to raise up to £4.75m at 3.85p a share on top of the £8m subscription by former AIM company China Medical System Holdings, which will licence products for the Chinese market. The clinical trial for cancer treatment MTD201 will cost up to £7m.
Duke Royalty (DUKE) is acquiring its UK rival Capital Step and this will double the size of the portfolio to eleven investments and diversify it in terms of sectors. There is an initial £10m cash payment and the assumption of debt of £11.65m. There is performance related consideration of up to £1.5m. The deal is immediately earnings enhancing.
Visa has increased its bid for Earthport (EPO) from 30p a share to 37p a share, which beats the Mastercard offer of 33p a share. The latest bid values Earthport at £247m.
Taptica (TAP) has launched a recommended bid for RhythmOne (RTHM) and this will create one of the largest video advertising companies in the US. The offer is 28 Taptica shares for every 33 RhythmOne shares. Taptica shareholders will own 50.1% of the enlarged group. A $15m share buyback programme is planned after the merger. Ofer Druker will become chief executive.
Polemos (PLMO) has finalised the details of its reverse takeover of Digitalbox Publishing for £10m in shares and it is also acquiring the owner of the Daily Mash satirical news website for up to £1.2m in cash and shares. The model for the Entertainment Daily website will be used to improve the performance of the Daily Mash. A placing will raise £1.02m at 14p a share. The company will change its name to Digitalbox.
Hardide (HDD) is raising £3.6m at 1.5p a share so that it can move to new premises in the UK and invest in additional equipment. The surface coatings company is experiencing increasing demand from the oil and gas sector and there is potential for orders from aerospace companies. It will take two years to fully equip and move into the new facility. Hardide also intends to consolidate 40 shares into one new share.
finnCap has raised its forecasts for Tracsis (TRCS) following recent acquisitions. There is a 3% increase in earnings per share for this year and an 11% rise to 30.5p next year.
Stride Gaming (STR) has traded in line with previously downgraded expectations. Cost cutting continues to cover higher regulatory and tax costs. The online gaming operator will report a lower profit in 2018 and it is set to fall again in 2019. Net cash was £22.1m at the end of 2018.
Bowmark Capital has offered 110p a share for Tax Systems (TAX) and discussions continue. Tax Systems reduced net debt from £20.5m to £13.9m by the end of 2018. Pre-tax profit of £5.8m is forecast for 2018.
Victoria (VCP) has sold surplus land in Kidderminster for £2m. The land was in the books for £100,000 but it has obtained planning consent for housing.
Starcom (STAR) has renegotiated its agreement with Xplosive in South Africa, having originally announced it in October 2017. Xplosive has signed a 36-month agreement to pay a monthly fee for each of the Kylos units supplied for the monitoring of cattle. The fees are higher in the first six months and then reduce. The agreement should be worth $500,000.
Strix Group (KETL) has offered to acquire most of the assets of HaloSource (HAL) for $1.3m. Strix has provided working capital of $100,000. Due diligence is being carried out on the water filtration technology and if the deal goes through the cash will pay creditors, but there will be nothing for shareholders.
Prospex Oil and Gas (PXOG) has announced that the Selva gas field in northern Italy has net 2P reserves of 13.3bcf and there are 2.26bcf attributable to Prospex, which has a 17% stake. Selva could start production in 2020 at a rate of up to 150,000 cubic metres/day.
Tau Capital (TAU) plans to raise cash via a placing through Peterhouse and then a capital distribution will be made to all shareholders. This will enable Tau to seek an acquisition. It has until 18 April to secure a deal or trading in the shares will be suspended. Armstrong Investments has increased its stake from 11.7% to 15.7%.
Evgen Pharma (EVG) says that the SFX-01 clinical trial for subarachnoid haemorrhage is on course having completed recruitment and the primary endpoints should be available in the second quarter. Partners Investment Company has acquired at 3.15% stake.
Sports Direct International (SPD) made a £15m offer to buy Patisserie Valerie from the administrator, but this was not deemed enough. Even a higher selling price won’t provide anything for Patisserie Holdings shareholders.
Solicitor DWF plans to raise £75m via a March flotation an some of the cash will repay members’ capital contributions as well as invest in the business. Existing shareholders will also sell shares and partners’ remaining stakes will be locked up until April 2024.
Two former AIM-quoted companies are coming together to join the standard list. Daniel Stewart Securities, which is closing its broking business, is making an offer for Atlantic Carbon, which was previously known as Atlantic Coal, where Adam Wilson, who has had connections with Daniel Stewart, is executive chairman. Singapore-based backer Epsilon Investments refused to put more money into the broker and that is why it is closing. Epsilon holds a majority stake in Hyde Park Holdings, which owns broker Novum Securities. Last October, SeeThruEquity research suggested that Atlantic had an equity value of $86.8m and $68m of debt. In 2017, Atlantic was the largest producer of anthracite in the US with a market share of one-third based on 1.18 million tonnes produced. Atlantic is expected to have moved into profit in 2018, although it did generate cash from operations in 2017. The owners of more than 50% of Atlantic shares have agreed to accept the bid of 1.5587 shares for each Atlantic share.
Thalassa Holdings (THAL) is offering 14.64p a share in cash and 0.26 of a share for each share in The Local Shopping REIT. Thalassa already owns 25.5% of the bid target, which is valued at 32.8p a share. The bid is an alternative to the winding up of The Local Shopping REIT.
Blockchain Worldwide (BLOC) is no longer acquiring blockchain technology developer Chorum Group because of political uncertainty affecting the UK equity markets. Former Avanti Communications boss David Williams is the director of Chorum. Blockchain Worldwide has more than £1m in the bank and is also looking at other technology sectors for acquisitions.
Drilling of the Colter appraisal well in Dorset has commenced and United Oil and Gas (UOG) has a 10% interest. The drilling should take three weeks. The Selva gas field in Italy has net 2P reserves of 2.7bcf attributable to United, which has a 20% stake. Selva could start production in 2020. United intends to move to AIM.
Oil and gas producer Zenith Energy (ZEN) has raised £607,000 in Canada and the UK at C$0.05 a share and 3p a share respectively.
Motor finance provider S and U (SUS) has confirmed that its figures for the year to January 2019 will be in line with expectations. The Aspen property bridging loan business had a loan book of £18m at the end of January 2019. Cautious lending criteria means that new business has slowed in recent months and this has led to a 5% 2019-20 earnings downgrade to 230.1p a share.
BATM (BVC) has won a $3.2m cyber security contract and this takes contracted revenues from this government customer to more than $10m. The latest contract will be delivered this year.
Chesterfield Resources (CHF) is expanding its exploration programme in Cyprus. Initial drilling in an area near historic mining has shown gold, copper and zinc mineralisation. Chesterfield is also applying for licences to extend its licence area.
Dev Clever (DEV) has launched pay per play multi-player, virtual reality game Vanguard: Fight for Rudiarius in Harlow shopping centre. The game will be rolled out to other UK sites.
Bluebird Merchant (BMV) has applied for a grant to help finance drilling at the Kochang project in South Korea and there should be news by the end of the month. There has also been a permit application to develop Kochang.
Property investor Ace Liberty and Stone (ALSP) increased its rental income by one-third to £1.95m in the six months to October 2018. Profit from continuing operations improved from £218,000 to £271,000 and a dividend of 0.83p a share has been announced. Four properties have been purchased since April 2018 and Hume House was sold.
Capital for Colleagues (CFCP) increased its NAV from 42.69p a share to 43.35p a share in the year to August 2018. The strategic focus is to make larger investments in bigger employee-owned businesses. There was £175,000 in the bank at the end of August 2018, so there appear to be limited funds available for further investments, although there are £1.3m of loans to investee companies.
Health and community care properties developer and modular buildings supplier Ashley House (ASH) was hit by delays in projects planned by its Morgan Ashley joint venture in the six months to October 2018. Only one scheme reached financial close during the period and a loss was reported for the period. Modular buildings demand is strong with a good pipeline of potential projects. A profit is still expected for the 14 months to June 2019, but this still depends on the timing of projects.
Hydro Hotel, Eastbourne (HYDP) increased its full year profit from £127,000 to £153,000 on turnover 4% higher at £3.66m. There is £1.09m in the bank at the end of October 2018. The dividend was maintained at 21p a share, which is covered 1.2 times by earnings. The strategy is to encourage more direct bookings with the hotel and an online booking system was launched last September. The completion of refurbishment activities has enabled an increase in bookings for weddings. Bedroom refurbishments continue.
Formation Group (FRM) reported an improvement in revenues from £37m to £38.6m in the year to August 2018, but the operating loss nearly quadrupled to £416,000. There was a gain on financial asset of £450,000 and an exceptional cost of £318,000 relating to an accident in 2015. Management is cautious about taking on new property developments under the current economic conditions.
Karoo Energy (KEP) is still trying to raise cash to enable it to move to AIM. Management is confident that it will be able to raise the funds in the near future.
Formerly AIM-quoted Altona Energy (ANR) did not managed to obtain a replacement nominated adviser for Northland and it has moved to NEX on 1 February. Sino-Aus Energy Group is subscribing for £500,000 of 7% convertible loan notes July 2020. The conversion price depends on the market price in the 2o days prior to conversion although the minimum is 10p a share.
Sport Capital Group (SCG) has appointed Epsion Capital to help it raise up to £20m from a share issue at a price of at least 0.5p a share. There will be a warrant issued with every four shares. A circular is being prepared to gain shareholder approval. Early Equity (EEQP) has raised £187,500 at 0.75p a share.
Ananda Developments (ANA) says that 15%-owned LHT has launched its hapac medicinal cannabis inhaling technology in Milan, Italy. The initial reaction has been positive.
VI Mining (VIM) has completed the acquisition of the Cushuro gold project for $27.5m in shares.
Nuclear notes linked to guaranteed contingent value rights relating to the takeover of British Energy will mature and stop being traded on 7 February.
Dealings in the shares of Wheelsure (WHLP) and Ecovista (EVTP) have been suspended because they have not published their results for the year to August 2018.
Recruitment and training company Staffline (STAF) has delayed the publishing of its accounts because of concerns about invoicing. Trading in the shares has been suspended.
Electronic and battery products supplier Solid State (SOLI) says trading is significantly better than previously expected. Gross margins are continuing to improve. finnCap upgraded its 2018-19 earnings per share forecast by 26% and the 2019-20 figure by 21%.
Filtronic (FTC) fell into loss in the first half even before the write-off of £500,000 of capitalised development costs. Massive MIMO antennas sales will not build up as quickly as initially expected. There is £2.2m in the bank so the antennas and telecoms hardware supplier has a strong cash position while it waits for orders to come through. There is expected to be a full year loss but cash should still be £1.8m. A focus on defence and public safety markets will help to diversify the customer base and provide new opportunities.
A court has ordered Grant Thornton to pay £21m relating to its failures in the auditing of AssetCo (ASTO) accounts in the financial years to March 2009 and March 2010. AssetCo had been seeking £40m from Grant Thornton and there is still interest to be calculated on the award.
Location Sciences (LSAI) says that 2018 trading was in line with expectations and 2019 has started well. There has been a soft launch of the Verify product that ensures that responses to advertising from mobiles are genuine. Paid for trials in the US will provide further evidence of effectiveness.
Begbies Traynor (BEG) has acquired Manchester-based Croft Transport Planning and Design, which provides highways and traffic advice to property developers, for an initial £1.5m in cash and shares. This widens the range of services offered by the property services division.
Utilitywise (UTW) has not published its accounts and trading in the shares has been suspended. The utility cost management consultancy has also effectively put itself up for sale as part of its strategic review. This was sparked by the failure to raise cash required from a share issue. The £25m bank facility expires in April.
BATM Advanced Communications (BVC) has secured an investment of up to $30m to fund the commercialisation of molecular biology products being developed by Ador Diagnostics, a joint venture with Gamida for Life, that is valued at $30m prior to the investment. The first $14.5m should be invested by the end of March and the rest will be invested at a 33.3% premium to the enterprise valuation after the initial investment by the end of 2020. Most of the cash will come from medical sector investors and Puma Brandenburg. BATM and Gamida will each invest $2m and after the initial investment BATM will own 38.2% of the company. Shore Capital will reinvest its total fees of $1m into Ador.
Rainbow Rare Earths (RBW) is obtaining a $750,000 convertible security investment and a 24 month equity facility of up to $7m from an entity managed by The Lind Partners, which will get an initial commitment fee of $75,000. Between $100,000 and $300,000 can be drawn down each month. The shares will be issued at prices that are linked to market prices at the time. Rare earths production at the Gakara project in Burundi is expected to build up over 2019 as two further areas are opened up. Production costs were higher than sales revenues in the three months to December 2018.
Sportech (SPO) has acquired digital gaming technology business LOT.TO Systems, which has developed the iLottery platform.
Path Investments (PATH) has sold its Turkish oil and gas interests for £400,000. The focus is the acquisition of ARC Marlborough. The plan is to acquire ARC, which has a nickel and cobalt project in Queensland, via a share issue.
Dukemount Capital (DKE) has agreed a forward funding and assignment of the contract of the Wavertree property in Liverpool. This is the second project that has reached this stage. Dukemount will continue to manage the redevelopment of the property and a development profit will be received on completion. Executive chairman Geoffrey Dart has been awarded a bonus of £80,000 for the completion of the first two transactions and it will be received in shares at 0.3p each.
Healthperm Resourcing Ltd (HPR) has won a contract from Medway NHS Foundation Trust to supply up to 400 nurses. New research from Edison Investment Research forecasts a 2018 loss of £2.3m for the healthcare staffing company, falling to £600,000 in 2019. Initial revenues were generated last year and they could reach £2.8m in 2019. As revenues grow margins should improve. Net debt could be more than £5m by the end of 2018. The company’s loan notes, which are being subscribed for in monthly tranches by the majority shareholder, are repayable at the end of 2019.
Barkby Group (BARK) joined NEX in June after reversing into former AIM company Sovereign Mines of Africa. The gastropubs operator generated revenues of £950,000 and an underlying pre-tax profit, before flotation costs, of £133,000 in the three months to July 2018. The Turf to Table branded outlets continue to outperform expectations. The company is debt free and ready to acquire additional properties.
Crossword Cybersecurity (CCS) has appointed an unnamed nominated adviser ahead of a prospective flotation on AIM in the next few months. Hybridan is already the company broker. SaaS-based cyber software provider Rizikon Assurance is making progress and other products are in development.
Halal food-based certification services provider DagangHalal (DGHL) increased its revenues from MYR4.64m to MYR6.46m in 2017. There was a cash outflow from operating activities of MYR9.44m and net cash was MYR11.6m at the end of 2018. The company has subsequently settled the dispute with its former chief executive with a payment of MYR500,000.
Blockchain ventures investor and adviser Coinsilium Group Ltd (COIN) has entered into a strategic partnership with Universal Reward Protocol, which is developing a protocol so that retailers and shoppers can interact, for a €20m token sale. Coinsilium has also agreed an advisory partnership with Y Ventures subsidiary, Luminore 8.
Positive Healthcare (DOC) has asked for trading in the company’s 7% bonds 2021 to be suspended. Irregularities have been identified at the principal operating subsidiary and Positive is unable to publish its accounts or pay the next instalment of interest on the bonds.
Etaireia (ETIP) has completed the sale of a property in Girvan for a loss of £12,000. The company acquired the property for 25 million shares and £35.000 in cash and has received £47,000 in cash plus £1,000 contribution to legal costs. The £35,000 cash consideration is yet to be paid.
PCG Entertainment (PCGE) had $1.4m in the bank at the end of March 2018. Since then, the settlement of an equity share agreement cost $156,000. Litigation with a former chief executive, which scuppered acquisition plans, has been completed with a settlement of $286,000. PCG is in talks with a potential gaming company acquisition.
Panther Metals (PALM) has completed its review of technical information on three exploration tenements in north west Ontario, where it holds an option to acquire. Several high grade gold veins and base metal occurrences have been identified. A detailed exploration programme is being designed.
Sinclair Pharma (SPH) has agreed a 32p a share cash offer from Huadong Medicine Co, but it is still subject to pre-conditions relating to the Chinese authorities.
Watkin Jones (WJG) has exchanged contracts for a 599 bed student accommodation site from Kelaty Propco. This project should be completed by September 2021. It has also secured another deal with Kelaty for a 300 residential apartment scheme in the same area, which will boost the build-to-rent pipeline.
One Media IP Group (OMIP) is planning to raise £2.9m via a share placing at 6p a share and up to £6m from a loan note issue to the Business Growth Fund. Lord Grade and Ivan Dunleavy have each invested £37,500 in new shares. The intellectual property owner intends to use the cash to acquire music publishing rights, artists recordings and songwriters’ rights.
Westmount Energy Ltd (WTE) has made a £810,000 investment in JHI Associates Inc, which is focused on exploration in the Guyana-Suriname basin, where it has a 40% carried interest in the Canje offshore block. This investment represents 56% of Westmount’s gross assets.
Otus Capital Management and Andrew Gibbs have nearly doubled their stake in Van Elle (VANL) to 10.2%. Mark Cutler joined the piling company as chief executive last month.
Polarean Imaging (POLX) has commenced the recruitment of patients for the phase III clinical trial in the US to demonstrate the non-inferiority of the company’s drug / device combination. The medical resonance imaging technology using hyperpolarised 129-xenon gas only has to show that it is as good as the current treatment. Eighty patients will be recruited. Some will be candidates for lung resection and others for lung removal. A pilot programme has helped to design the study, which could be finished before the end of 2019. Polarean has enough cash to make progress with the trial but will need more finance to reach completion.
Positive initial results from an oncology drug study have given the Midatech Pharma (MTPH) share price a boost. This is the first in-human study for MTD201 Q-Octreotide, a sustained-release treatment for carcinoid cancer and acromegaly. The study shows a safe, well-tolerated and effective sustained release of the drug.
Filtronic (FTC) has won a second order, worth $1.1m, for its MassiveMIMO technology, which helps mobile networks use their spectrum efficiently. It is still early days for the technology, but this is a positive sign and will offset the decline in older product ranges.
CCTV and security technology supplier Synectics (SNX) has secured a large contract with Serco, covering six custodial sites. This will help to underpin the current forecasts.
Altona Energy (AHR) has signed an exclusive licence for pyrolysis technology in Australia and China with GCAT. This will enable Altona to construct plants in the two countries and Altona will receive 95% of the net revenues generated by the technology when used in the treatment of waste.
Thor Mining (THR) says that metallurgical test work shows 78% copper recovery at the Kapunda copper project when using glycine as a leaching agent. Thor is earning up to 60% of Kapunda.
FIH Group (FIH) has traded well in the first five months of its financial year, thanks to a strong performance by arts logistics business Momart, which has opened a new facility. The Gosport ferry and Falkland Islands activities are trading in line with expectations. A small reduction on last year’s pre-tax profit of £3.2m is still anticipated.
Starcom (STAR) reported a 61% increase in interim revenues to $3.1m. There has also been a change in mix from lower margin to higher margin products. The security and tracking products developer is still losing money and is on course for a small, but much reduced, full year loss. The business is second half weighted so the outcome is heavily dependent on trading in the last few months of the year.
BATM (BVC) is set for a good second half. The biomedical and networking divisions have both been winning contracts and a significant amount of the benefits of these wins will come through in the second half. The most high profile contract win is the joint development deal with ARM. The first deal under this agreement is with FatPipe Networks, which develops technology for the optimisation and security of wide area networks. Longer-term, BATM’s SDN/NFV technology could be important in the development of driverless vehicles and other new technologies. BATM has net cash of nearly $17m.
Interim revenues at Ross Group (RGP) declined by 28% to £68,000 but it still managed to make a pre-tax profit of £10,000. The search continues for a suitable acquisition. Large shareholders have lent £6.07m to Ross.
Telecoms services provider Toople (TOOP) has won a contract with a reseller worth at least £3.5m over a three year period. Group gross margins are running at around 15%. That suggests a gross profit of £525,000 over the period of the contract, although the gross margin on this business could be higher. To put that in perspective, chief executive Andrew Hollingworth is entitled to a salary of £120,000, so this contract could cover his salary and some of the other directors’ salaries. Toople needs further wins to reach breakeven. The share price has more than trebled since the contract news, just in time for another share issue to raise cash to keep the business going.
Small cap award winners 2018
Company of the year
ZOO Digital (ZOO)
The ZOO Digital share price is ten times the level it was one year ago. ZOO localises film and television content and it has been investing in upgrading its technology and services over the past few years. This investment is paying off and the ability to offer cloud-based services is helping the business to grow and move into profit. Hollywood studios have been customers for many years and ZOO is winning market share. Newer entrants to the market such as Netflix have grown the demand for localisation of content. ZOO is expected to report an underlying pre-tax profit of £500,000 for the year to March 2018.
NEX company of the year
Crossword Cybersecurity (CCS)
Cyber security technology developer Crossword Cybersecurity originally floated on GXG and then switched to NEX. It was one of the youngest companies that was on the shortlist for this award. Crossword is generating modest revenues and it is developing cyber security products with partners. The real potential for the business will not be realised for a few years.
Impact company of the year
Walls and Futures REIT (WAFR)
Walls & Futures REIT is an ethical housing REIT that develops new housing for people with learning and physical disabilities or requiring extra care. In 2017, Walls and Futures achieved a total return on its portfolio of 11.5%, ahead of its benchmark total return of 7%.
IPO of the year
K3 Capital (K3C)
Business sales and corporate finance company K3 Capital Group joined AIM at 95p a share in April 2017 and the share price has more than trebled. Bolton-based K3 helps owners to sell their businesses and it gains clients through a direct marketing strategy. The AIM quotation and the related higher profile appears to have helped to accelerate growth. A move up the Thomson Reuters deal rankings is also helping. Last year, revenues rose by 26% to £10.8m, while pre-tax profit improved 18% to £3.6m. In the six months to November 2017, revenues were 34% ahead at £7.5m and pre-tax profit moved from £2.48m to £3.21m.
Fintech company of the year
FAIRFX Group (FFX)
Foreign exchange and e-banking services provider FAIRFX has a low cost model while offering an improved experience to the more established rivals. Turnover was £1.1bn last year, while revenues were £15.5m and this enable the company to move into profit. Corporate turnover was 52.3% of the total, up from 45.5%. The company recently moved its international payments book onto the City Forex platform following its acquisition. The focus is increasing scale to improve efficiency combined with the rolling out of new products.
Transaction of the year
Proactis (PHD) – merger with Perfect Commerce
Spend control software provider Proactis merged with Perfect Commerce in August 2017. The deal significantly increased the scope of the business and added to the management team. The integration of the businesses appears to be going well but the loss of a couple of large customers has held back progress in the year to July 2018. Even so, annualised contracted revenues are still £45.5m. Progressive Equity Research still expects a near-doubling of this year’s pre-tax profit to £10.2m, rising to £13.2m next year. That means that earnings per share growth is modest this year because of the additional shares in issue.
Executive director of the year
Bobby Kalar – Yu Group (YU.)
Electricity and gas supplier Yu Group floated on AIM in March 2016 at 185p a share. The current share price is more than four times that level. The focus is on commercial customers. Yu increased its revenues from £16.3m to £47m last year and annualised bookings continue to grow. Underlying pre-tax profit jumped from £195,000 to £3.08m. The dividend was increased from 2.25p to 3p a share. Trading continues to be strong and average annualised bookings per month were £6.6m. The cash pile has increased to £18.6m at the end of April 2018. Yu has obtained a licence to supply water.
Journalist of the year
Paul Scott – Stockopedia
Fund manager of the year
Nick Williamson – Old Mutual
Microcap fund manager of the year
Guy Feld – Canaccord Genuity
Analyst of the year
Kevin Ashton – Cantor Fitzgerald
Lifetime achievement award
Katie Potts – Herald Investment Management
Special services to small caps
John Jenkins (Founder of Ofex/NEX)
Daniel Thwaites (THW) increased its 2017-18 by 9% to £92.2m, while operating profit improved by 7% to £12.9m. There was a 79% increase in earnings per share to 13.8p, mainly due to a swing from a loss on interest swaps to a profit. The total dividend is unchanged at 4.46p a share. Investment in the pubs and hotels operations and in the new craft brewery at Mellor Brook has led to a rise in net debt from £47.6m to £63.7m. The old brewery will be demolished and the land will eventually be sold or developed. Poor weather means that the new financial year has started more slowly than last year.
Hellenic Capital has changed its name to Pelican House Mining (PHM) and is focusing on investing in early-stage resources projects in Africa. The focus is making capital gains on the investments. Pelican is trying to supplement its cash resources by selling a commercial property in Leeds, but the buyer withdrew. Pelican has retained the deposit. The investment property in Leeds is in the books at £204,000. Two directors, Simon Grant-Rennick and Mark Jackson, have been granted options over a total of seven million shares exercisable at 0.55p each.
Newbury Racecourse (NYR) says that its conference and events division is 22% ahead of the same time last year and the revenues of the hotel have risen by the same percentage. There has been a 17% rise in revenues for the nursery business on the back of occupancy rates rising by six percentage points. There are longer-term worries about the financial ability of bookies to provide sponsorship and other revenues. Management says it will not be paying any dividends until 2022 at the earliest after the current development projects are completed.
PCG Entertainment (PCGE) has raised £303,000 at 0.15p a share and around £119,000 will go towards paying the £119,000 settlement with D-Beta, which provided an equity sharing facility. D-Beta has sold its existing stake. PCG is talking to Cavitation Solutions Ltd about distributing cavitation technology, which deals with oil and other water pollutants, in China. It is also talking to ChainZy about distributing its blockchain-based technology in Asia. There is interest from third parties concerning the use of PCG’s media and gambling licences in China.
IMC Exploration (IMCP) has raised £250,000 at 0.7p a share and the cash will be used to develop the company’s three main gold and zinc projects.
South Africa-focused investment company Inqo Investments Ltd (INQO) has made a second investment in Uganda-based Four-One Financial Services, which manages the Mazima micro-pension scheme. This is the second tranche of the original investment and is in the form of a $100,000 convertible loan.
NWF (NWF) says that last year’s trading was much better than expected and net debt is lower than forecast. The feeds business improved its performance and trading of the fuels division was strong. The food distribution operations wee hit by reorganisation requirements and did not perform as well as expected.
Diversified Gas and Oil (DGOC) has got another large deal on the blocks and trading in the shares has been suspended. The Appalachian Basin oil and gas producing assets will be acquired for $575m and it will more than double the group’s daily production. This should be an earnings enhancing deal. A $225m share placing is required to help finance the deal.
RedstoneConnect (REDS) chief executive Mark Braund intends to leave the smart buildings technology company. Frank Beechinor will move from chairman to chief executive. The disposal of the systems integration and managed services divisions has been completed and the group can focus on its software business.
Ilika (IKA) has gained government funding of £4.1m for two battery technology projects in the automotive sector. The PowerDriveLine project is developing a solid state battery for hybrid and electric vehicles. The other project is headed by McLaren Automotive and is developing a battery for performance cars.
Secure payment products provider Eckoh (ECK) increased its full year revenues by 3% to £30m but pre-tax profit was 61% higher at £2.4m thanks to an improvement in operating margin. Growth in the US made up for a weaker contribution in the UK.
Redhall Group (RHL) slumped back into loss in the first half due to a delayed contract. However, it is still on course to make an improved profit in the full year. Interim revenues were 22% lower at £14.7m. There is strong demand for the company’s specialist doors from the nuclear and transport sectors.
Evgen Pharma (EVG) has enough cash to get to the end of 2018. There should be further positive news about the two ongoing clinical trials prior to the end of the year. Interim analysis of phase II trial of SFX-01 as a treatment for breast cancer show that six out of 20 patients, who had tumours that had initially responded to treatment but had become resistant, saw some benefit from the treatment of their tumours. The treatment has also been shown to be safe. The final results of the trial should be published before the end of the year.
Life sciences company Abzena (ABZA) has decided to focus on monetising its technology rather than raising money via a share issue. A non-binding heads of agreement with a third party would involve the sale of an interest in future royalties. If this deal is completed there would be enough working capital for the short-term.
Active Energy Group (AEG) has signed a memorandum of understanding with Young Living Farms for the sale of a PeatSwitch plant, which makes environmentally friendly peat replacements. The first plant is in Mona, Utah and the client is paying $3.4m in cash. There could subsequently be other plants at the client’s other sites.
Trading has resumed in the shares of Audioboom (BOOM) following publication of its accounts. The share price fell from 3.6p to 2.18p. The podcasts publisher has raised £4.5m from a placing at 3p a share.
WideCells Group (WDC) managed to raise £513,000 at 3p a share via a bookbuild on the Teathers app. That includes £183,000 from directors. The total amount raised by the stem cell services provider is £2.04m, including conversion of debt of £165,000. Shareholder approval is required for the share issue.Trading in the shares has resumed and the share price has fallen below the placing price. WideCells is using £615,000 of its £624,500 overdraft, which will be reviewed at the end of June. Shareholders have loaned £120,000.
China-based Gamfook Jewellery is planning to join the standard list. The online retailer customised jewellery wants to raise £5m in order to invest in retail sites. Gamfook has managed to generate cash from operating activities in the past few years, although next year there will be a significant working capital outflow according to forecasts. Gamfook is offering an 8.5% yield on its potential placing price of 15p a share and that would rise to 12.5% in 2019.
Air Partner (AIR) has completed its accounting review and the net assets overstatement of £4m net of tax is in line with indications. There were accounting errors and subsequent attempts to cover up the problems going back to 2010. The review has cost £1.3m. Air Partner still intends to pay a final dividend of 3.8p a share.
BATM (BVC) has won a $3m follow-on cyber security for a government department. The total contract value will be $7m.
Falcon Media House (FAL) has raised £500,000 via a convertible loan note issue. The conversion price is 1.5p a share.
Cash shell AIQ Ltd (AIQ) has raised £250,000 from an oversubscribed open offer at 20p a share but there was a delay of one day before the shares were admitted to trading on 14 June. The share price has slumped from a high of 160p to 24.5p over the past month.
Dukemount Capital (DKE) has agreed a 30-year lease on a second property in north west England. Housing association Inclusion Housing is paying £168,740 a year for the lease subject to planning permission for extra rooms. The property needs to be refurbished.
Bluebird Merchant Ventures Ltd (BMV) has executed the 50/50 joint venture agreement with Southern Gold for the Kochang mine and the feasibility report is expected before the end of September. The required $500,000 investment has nearly been completed by Bluebird and it is on course to invest the required $250,000 in Southern Gold. First gold is expected before the end of 2019.
Formation Group (FRM) has been repaid its £5m loan for a development in Wembley and it retains a 40% share of the profit of the development. This cash has been used to invest in acquired a 3.44% stake in Proton Partners International, which has an operational proton beam therapy centre in South Wales with two more sites planned. A treatment unit in Abu Dhabi is expected to be launched in 2019.
Capital for Colleagues (CFCP) has loaned £600,000 to TG Engineering, which supplies steel and aluminium components to the aerospace and scientific sectors. The Dorset-based company will be 35%-owned by Capital for Colleagues and 20%-owned by the employee share ownership trust. The rest of the shares will be owned by the original founders and management.
IMC Exploration (IMCP) intends to focus on its main projects in Ireland. The interim loss was reduced from £99,000 to £75,000. There was net debt of £35,000 at the end of 2017.
Block Commodities (BLOC) has agreed to acquire a 21% stake South African fertiliser and plant products wholesaler VIPA Holdings. Block is paying £150,000 for new shares and acquiring £610,000 worth of existing shares in return for 748.5 million Block shares. VIPA is loss-making following the withdrawal of a major international trading partner. The ongoing focus will be fertiliser and the investment in Advanced Agricultural Holdings will be unwound with the 221.6 million shares issued as initial consideration returned to the company.
Primorus Investments (PRIM) has invested £500,000, at £22 a share, in Engage Technology Partners. This follows an initial subscription of £400,000 at £15 a share. Primorus owns 3.6% of Engage, which builds SaaS-based employee workflow software.
Hellenic Capital (HECP) had £272 in the bank at the end of 2017, but since then £179,000 has been raised at 0.5p a share. There was £120,000 generated from operations in 2017 but that was due to a £143,000 increase in creditors. An investment property in Leeds is in the books at £204,000, while the NAV was £58,000 at the end of 2017. The property is being sold for £235,000 and a £5,000 non-refundable deposit has been paid.
Globe Capital Ltd (GCAP) has raised £500,000 via subscription at 0.75p a share. The cash will finance a new office in Dubai. Valiant Investments (VALP) has raised £51,000 at 0.15p a share. The 84.7%-owned Flamethrower has acquired National-Preservation.com, which focuses on British railway heritage, and has nearly 10,000 registered users. Equatorial Mining and Exploration (EM.P) has raised £40,000 from an issue of 5% unsecured irredeemable convertible loan notes and a further £10,000 could come from the exercise of warrants. Via Developments (VIA1) has raised a further £590,000 from a debenture issue, taking the total raised to nearly £6m. The accounting reference date is being changed from March to September.
In 2017, Walls and Futures REIT (WAFR) achieved a total return on its portfolio of 11.5%, ahead of its benchmark total return of 7%.
DHAIS (DHAP) is leaving NEX on 18 April, nearly ten years after joining the market. The business is being streamlined and the focus is organic growth of the hearing aid operations. Shareholders owning 78.9% of DHAIS agree to the withdrawal so the company does not have to hold a general meeting.
Diurnal Group (DNL) is raising up to £11m at 190p a share in order to finance the launch of the Alkindi hormonal disease treatment for children in Europe and complete the development of Chronocourt in Europe and start a phase III study in the US. IP Group is converting its loan into shares.
Shares in VR Education (VRE) immediately went to a premium when trading commenced. It raised £6m at 10p a share and the share price ended the week at 12.25p. More than two million shares were traded during the week.
1Spatial (SPA) has sold Enables IT back to the founder for £1, while retaining a 19.9% stake. 1Spatial has also injected £150,000 into the business and loaned a further £85,000. The group will be able to focus on its geospatial data operations, which are performing better than expected. 1Spatial is on course to approach breakeven in the year to January 2019.
Marshall Motor Holdings (MMH) is outperforming new and used car markets, although like-for-like sales are still lower. Profit is expected to decline this year but Marshall should be able to continue its progressive dividend policy. There is a significant capex programme but the sale of the leasing business means that net debt is £2.2m.
Pennant International Group (PEN) already has nearly all of the £20.5m revenues forecast for 2018 covered by orders. Pre-tax profit is forecast to improve from £2.1m to £3.5m.
Amryt (AMYT) says that sales of Lojuxta were higher than expected last year. The figure was €11.9m, against the forecast €10.5m. There is still €20.5m in the bank.
Futura Medical (FUM) announced positive pharmacokinetic results for higher doses of the MED2002 erectile dysfunction treatment. This will enable US phase III trials to start later this year. There is £8.36m in cash plus tax credits due.
TechFinancials Inc (TECH) says that Cedex Holdings, where it could acquire a majority interest, has launched its token pre-sale event. One Ethereum (equivalent to £437) will equal 900 CEDEX coins. The blockchain-based online diamonds exchange says that there is strong pre-sale demand.
Genedrive (GDR) has started to sell its Genedrive HCV ID kit in the EMEA region. Sales in Asia Pacific should start in the next few weeks.
Consumer security software provider Kape Technologies (KAPE) improved its pre-tax profit from $4.8m to $6.7m. There is net cash of $69.5m. A 2018 profit of $8.3m is forecast.
Trevor Brown gas cut his stake in Feedback (FDBK) from 11.5% to 9.75%. Lindsay Melvin has taken on the role of finance director.
Advanced foams supplier Zotefoams (ZTF) continues to benefit from investment in capacity and there is more to come. There was growth from all divisions and a good spread of revenues from different sectors. In 2017, revenues were 22% higher at £70.2m, while underlying earnings per share were 14% ahead at 16.6p. The dividend is 3% higher at 5.93p a share. The partnership with Nike to develop footwear technology and supply materials is yet to make a significant contribution.
BATM Advanced Communications (BVC) returned to profit last year and both its telecoms and biomedical divisions have good growth prospects. There is $24m in cash in the bank.
Sportech (SPO) has ended its formal sales process because no suitable offers were received. Trading has been poor and there will be asset write-offs in the 2017 figures. Andrew Gaughan has been appointed as chief executive.
Flying Brands Ltd (FBDU) has acquired Imaging Biometrics for $68,134 in cash and 11 million shares at 4p each, plus $75,000 to cover debt obligations. The final 6.2 million of these shares will be paid by the end of September 2018. The Wisconsin-based company has been managing the CE marking and FDA clearance process for Flying Brands’ StoneChecker visualisation software, as well as commercialising perfusion software IB Neuro, which provides additional information about tumours.
World Trade Systems (WTS) has submitted its application to the International Stock Exchange.
Hemogenyx Pharma (HEMO) announced a collaboration that will generate $250,000 for the blood stem cell-based treatments developer. The partner is a US-based leader in the field of blood cancer treatment and the deal involves the development of a type of humanised mice.
Ultra Electronics ULE found 2017 to be a challenging year and only modest progress can be expected for 2018. 2017 ended with a strong order intake and a sound balance sheet but basic earnings per share fell by 20%. revenue by 1.3% and both underlying operating profit and underlying profit before tax both fell by 8.4%. So it will despite the poor year,raise its final dividend by 4.8% as any self respecting company will do when things are not good and and it needs to keep the shareholders in line. Mind you it did the same at half time when it had become apparent that things had started to go seriously wrong with its UK military business. Then it increased the interim dividend by 2.8p. per share even though storm clouds were gathering on the horizon.
Wizz Air Holdings WIZZ February passenger numbers rose by 23.5%, slightly less than the increase in capacity and the load factor also fell slightly to 91.2%. The network expanded with 4 new routes.
BATM Advanced Communications plc BVC 2017 became a milestone year as the company capitalised on previous investment and achieved its first year on year growth since since 2011. Revenue for the year rose by 18.5% and earnings per share moved from a loss of 0.27c oer share in 2016, to a positive 0.06c. Adjusted operating profit jumped from $0.9m to $5.6m. The bio medical division continued to show particular strength and growth momentum across both divisions, is expected to be maintained for 2018.
Zoo Digital ZOO updates that growth has continued into the second half and full year EBITDA is now expected to be above market expectations whilst full year revenue to the end of March should have risen from $16.5m to $28m.
Fusion Antibodies FAB updates that revenue for the year to the end of March is expected to show a rise of 40%, a substantial drop on the first half’s 70% growth but only because of the significant amount of management time and focus which had to be spend on the pre Xmas IPO. Growth rates are expected to resume their earlier trend now that management is free to concentrate on running the business.
My Sale Group plc MYSL produced a record first half performance for the half year to 31st December with underlying profit before tax rising by 266% on revenue up by 11%. Underlying basic earnings per share showed a rise of 82% and the active customer base rose by 12% to 1 million
Blockchain technology investor Coinsilium Group Ltd (COIN) is advising Tutellus Technologies on its upcoming token generation event. Tutellus matches students with teachers in the Spanish-speaking world. The Tutellus token will be used as a medium of exchange for the new blockchain-based platform. Richard Lloyd has been appointed as adviser to Coinsilium’s Gibraltar-based subsidiary TerraStream, which is developing a token offering platform. TerraStream intends to raise cash via a token offer but it is waiting for a more specific set of regulations from the Gibraltar Financial Services Commission that should be published in the second quarter.
IMC Exploration Group (IMCP) has decided to focus on the flagship project in gold project at Avoca, Wicklow and the Kilbricken zinc deposit in County Clare. IMC plans to relinquish five licences.
Natural resources investing company MetalNRG (MNRG) has appointed Rolf Gerritsen as chief executive and he is subscribing for 2.5 million shares at 2p each, combined with 2.5 million warrants exercisable at 3p each. The former chief executive Paul Johnson is acquiring the same number of shares on the same terms. MetalNRG is progressing the potential standard listings of a number of resources businesses and it will retain stakes. MetalNRG is also seeking to move to the standard list.
Health staff recruiter Healthperm Resourcing Ltd (HPR) generated revenues of £250,000 in 2017. There were 130 candidates deployed. The company intends to double its number of employees by the end of June 2018. New contracts have been won in the Middle East and with Walsall Healthcare NHS Trust and these candidates will be found this year. The 2017 figures should be published in May.
Gooch and Housego (GHH) says that it is experiencing exceptional demand for critical components for microelectronic manufacturing and this has offset any slowing in demand for high reliability fibre couplers. Trading is in line with expectations and there will be a second half weighting to the year’s figures. US tax changes will reduce the deferred tax in the balance sheet by £500,000 and cut the effective rate of tax to around 23%.
Lighthouse Group (LGT) is doing particularly well at the moment. The IFA significantly increased its business from affinity groups and average revenues per adviser rose by nearly one-quarter to £122,000. Assets under management are starting to build up and the fees from these will begin to become more important. In 2017, pre-tax profit improved from £1.9m to £2.5m and net cash was £8.7m. The dividend was raised from 0.27p a share to 0.42p a share.
Scotland-based Springfield Properties (SPR) reported maiden interim results. Revenues were 10% higher at £54.8m and pre-tax profit was £3.1m, up from £2.6m. The fastest growth came from the affordable homes division. The private housing side is waiting for planning permissions for planned villages in Scotland but existing permissions mean that the second half has significant contracted revenues. Even though Springfield was quoted for a few weeks of the period it is paying a 1p a share interim dividend.
Saffron Energy (SRON) has asked for trading in its shares to be suspended because there have been changes to the proposed acquisition of south east Asian oil and gas assets. A supplementary admission document is likely to be required.
Gas and electricity supplier Flowgroup (FLOW) has secured £5m of additional funding from Palm Ventures and Lombard Odier Asset Management to provide seasonal working capital. Cost savings are on track but the market remains competitive.
Ultimate Sports Group (USG) has decided to stop marketing spending on the UltimatePlayer.me children’s sport platform due to disappointing take-up. There will be a £521,000 write-off relating to this platform. There was £130,000 in the bank at the end of 2017 and Ultimate has raised £537,500 at 5p a share, although this will require a capital reduction. Richard Bernstein is acquiring nine million shares and David Kyte the other 1.75 million shares. Eurovestech-boss Bernstein has been engaged to find a suitable business to acquire and a successful transaction would net him a fee of 1% of the value of the acquisition.
Fintech business TruFin (TRU) joined AIM on 21 February, when it raised £70m at 190p a share. The share price ended the week at 214p.
Stanley Gibbons (SGI) has secured a £19.4m investment from Phoenix UK Fund to shore up its poor balance sheet. This will leave Phoenix with a majority stake, but it will take out the RBS debt.
CCTV technology business Synectics (SNX) improved its pre-tax profit from £2.6m to £3m last year, despite strong comparatives in the key gaming sector in the previous year. Oil and gas improved its contribution but trading in transport was hit by the lack of new buses being bought by companies. Synectics expects flat pre-tax profit of £3m for the year to November 2018, due to additional development spending, but a sharp jump to £4m is forecast for next year.
Tristel (TSTL) has been hit by tough trading conditions in surface cleaners in the NHS and investment in gaining approvals have also held back profit. The international business goes from strength to strength and this helped interim pre-tax profit to grow to £2m. US EPA approvals for surface cleaners could be gained by May but then state by state approvals are required so revenues will not flow through until 2019. Approvals for endoscope cleaning products require FDA approval and will take longer.
Drilling results from the APTA deposit at the Anza project in Colombia that is 100%-owned by Orosur Mining Inc (OMI) have been positive. High grade gold mineralised intercepts currently cover a strike extent of 1.5km and a depth of 275 metres. Results are awaited on five more holes and six holes will be drilled on Charrascala deposit.
Kin Group (KIN) says it will not make an acquisition by 28 February so trading in the shares will be suspended. There are talks with potential acquisitions and £800,000 remains in the bank.
London and Associated Properties (LAS) is selling the Brixton markets to Market Village for £37.25m in cash. This compares to book value of £24.5m. The net income is £1.2m a year. London and Associate Properties had net assets of £38m, which is equivalent to 44.5p a share, at the end of June 2017. The share price is at a one-third discount to the June 2017 even without any profit on the disposal and gearing should fall to below 100%.
Macfarlane Group (MACF) increased pre-tax profit by 19% to £9.3m on the back of a 9% increase in revenues. The profit growth came from the packaging distribution division with the manufacturing division making a lower contribution. The full year dividend was raised from 1.95p a share to 2.1p a share. The pension deficit has been cut from £14.5m to £11.8m.
BATM Advanced Communications (BVC) had a strong second half and 2017 revenues were much better than expected. EBITDA is expected to jump from $2.8m to $7m. The growth is coming from both the networking and biomedical divisions.
Precious stones explorer Shefa Yamim (SEFA) says that Macquarie University has confirmed the existence of moissanite coupled with titanium-rich corundum in its licence area volcanic rocks and this augurs well for the potential of the Kishon Mid-Reach project.
Reckitt Benckiser RB delivered what it claims was a solid end to the year with like for like fourth quarter net revenue up by 2% on a constant currency basis, accompanied by volume led growth also of 2%. For the year as a whole like for like net revenue at constant exchange rates was flat thus justifying the claim that the fourth quarter saw a return to growth. Reported net income for the year rose by 88% at constant exchange rates but on an adjusted basis this fell back to 4%, whilst adjusted earnings per share were up by 10%. The final dividend is to be 97.7p per share making a total increase for the year of 7%. For 2018 the target is total like for like revenue growth of 2-3% as RB continues on its journey to becoming a global leader in consumer health care.
Spectris SXS made good strategic progress in broadening its customer offer in 2017 with like for like sales rising by 6% and adjusted operating profit and earnings per share by 8% and 14% respectively. The final dividend is to be increased by 9%.
Fidessa Group FDSA reports a solid performance in transforming markets in the year the 31st December, with adjusted profit before tax rising by 5% on a constant currency basis. The final dividend is to be increased by 5% on top of which there will be a repeat of the previous years special dividend of 50p per share. For 2018 similar levels of constant currency growth are forecast.
Dart Group DTG expects that underlying profit before tax will be materially ahead of current market expectations for the year to the end of March, due to the end of the heavy discounting of the past year, the return of a more normal pricing environment and the continued success of its growing leisure travel business With satisfactory forward bookings, trading for 2019 is expected to be in line with the current year.
BATM Advanced Communications BVC expects that 2017 revenue will be significantly ahead of market expectations at $106m, which represents a year on year rise of 17%. This follows the company’s success in obtaining new customers, new contracts and new territories.
Wines maker Chapel Down Group (CDGP) says that its open offer at 50p a share was oversubscribed. Excess applications will be scaled back. The additional £1.47m raised takes the total to £20m. BlackRock holds a 5.79% stake and Nigel Wray owns 16.2%.
Startup Giants (SUG) has made its first investment since floating. An undisclosed investment has been made in Go Show Ltd, which operates a brand marketplace designed to enable product placement deals (www.goshow.net), and it will be released when milestones have been achieved. Go Show initially applied for funding in 2015 and it has been mentored by Startup Giants. There is a target for revenue generation of up to £1m within 12 months. An accelerator round has also been launched by Startup Giants. It is aimed at early stage, UK-registered companies.
Coinsilium Group Ltd (COIN) has increased its shareholding in Indorse from 3% to 6.5% at cost of S$175,000. There is an option to acquire a further 3.5%, at the same cost, to take the stake to 10%. Indorse completed a token sales last September and those tokens are currently valued at $34m. The Indorse platform is designed to enable users to generate income from sharing their skills and validating the claims of others.
African Potash Ltd (AFPO) has entered into an agreement with Gibraltar-based TokenCommunities Ltd. This deal will help the blockchain joint venture that has also already been announced with FinComEco Ltd, which is developing platforms for agricultural markets in sub-Saharan Africa. TokenCommunities will advise on the deployment of tokens. The chain will link smallholder farmers, traders, brokers, storage, transportation and commodity buyers. There are plans for microloans to farmers at an annual interest rate of 12%, which is lower than existing rates. African Potash has completed the raising of £400,000 at 0.025p a share.
Black Sea Property (BSP) has completed the €2.76m purchase of four plots of land with permission to develop a camping complex. It has also invested €3.37 to help finance the development of the site, which could be completed by the middle of the year. Black Sea Property raised €3.53m at €0.01 a share late last year.
Lake Acquisitions (U.P) says that the contingent value rights holders will not get a distribution for 2017. The cumulative relevant revenues from the eligible nuclear power output was £41.1m. The cumulative base revenues were £41.9m.
UK Oil and Gas Investments (UKOG) has decided to drop its NEX Exchange quotation on 31 January. That is just over 27 months after it joined. The company says that there have been low levels of trading on NEX and it still has its primary quotation on AIM. Interestingly, oil and gas company UK Oil and Gas was formed many years ago out of the shell of a former technology equipment business, yet it is still classed under the technology hardware and equipment sub-sector of the technology sector in the AIM statistics.
Nexus Infrastructure (NEXS) reported maiden full year results as a quoted company that were slightly better than expected. The housebuilding infrastructure provider reported a dip in pre-tax profit from £10.8m to £9.1m on flat revenues of £135m. The total dividend is 6.3p a share. A 2017-18 pre-tax profit of £10.8m is forecast.
Ilika (IKA) reported a significant cash outflow in the first half but the outflow should be reduced in the second half. Interim revenues trebled to £1m and full year revenues of £2.9m are forecast. The loss is reducing. There are licensing proposals with a handful of potential customers and any one of these could transform the fortunes of Ilika.
EKF Diagnostics (EKF) has confirmed that trading was strong in 2017 and EBITDA will be much better than the £8.8m forecast. EKF plans to spin-off its sTNFR biomarker technology into a separate company. This technology has no value in the balance sheet.
Hormonal disease treatments developer Diurnal Group (DNL) says that its Akindi treatment has performed well in a food matrix study in the US and it will be able to move onto the next stage in the process of gaining US approval. European approval for Akindi is expected in a matter of weeks. There was £14m in the bank at the end of 2017. The interims will be published on 12 March.
Lombard Risk Management (LRM) is recommending a 13p a share cash bid, which was nearly double the market price. The bid from rival financial services technology supplier is valued at £52.1m.
Somero Enterprises (SOM) has sparked another forecast upgrade with the 2017 pre-tax profit forecast rising 8% to $25.9m. Net cash should be at least $18.5m and that could rise by around $10m by the end of 2018. That leaves room for another special dividend as well as growth in the ongoing dividend. The tax changes in the US had already led to a one-fifth increase in the 2018 earnings per share forecast to 34.4 cents, which has been raised again to 36.8 cents.
Engineer Avingtrans (AVG) says that trading is on track and the integration of Hayward Tyler continues. A pre-tax profit of £2.2m is forecast for the year to May 2018 and this should generate nearly enough earnings to cover the forecast dividend of 3.6p a share.
Tough market conditions and adverse currency movements have not stopped motor dealer Marshall Motor Holdings (MMH) trading ahead of expectations. Forecasts had already been upgraded and the 2017 pre-tax profit estimate has been raised a further 2% to £28.8m. However, a decline in pre-tax profit to £23.5m is forecast for 2018.
Smart meter communications technology provider CyanConnode (CYAN) continues to progress but the timing of orders has been delayed. The order book is worth $100m but 2017 revenues were £1.2m and the loss more than £10m. This year’s revenues are forecast to be £10m and the loss £7m. There should be enough cash to last the whole of 2018.
Strategic Minerals (SML) generated fourth quarter revenues of $2.14m from magnetite ore sales at Cobre. The 2017 total revenues of $5.64m were quadruple the previous year. Strategic had $3.8m in the bank at the end of 2017.
Online Blockchain (OBC) has taken advantage of its rising share price to raise £1m at 100p a share.
Fashion retailer Footasylum (FOOT) increased revenues by one-third to £89.8m in the 18 weeks to 30 December 2017. The fastest growth came from e-commerce. The revenues for the 44 weeks to 30 December 2017 also improved by one-third to £173m. These are not like-for-like increases and six stores were opened in the past 18 weeks.
There was a small decline in the full year revenues of Shoe Zone (SHOE) from £159.8m to £157.8m. The shoes retailer did improve its gross margin from 62% to 63.2% but higher admin and distribution costs offset this and pre-tax profit fell from £10.3m to £9.5m. The total dividend was edged up from 10.1p a share to 10.2p a share. Net cash was £11.8m at the end of September 2017. The pension fund liability has fallen from £13.1m to £7.1m. Consumer demand and currency movements remain the main challenges.
BNN Technology (BNN) directors Harry Keiley and Lord Mancroft are following the nominated adviser out of the door. Mark Hanson becomes non-executive chairman.
Film completion contracts provider FFI Holdings (FFI) has acquired the motorsports entertainment insurance book of business from All Risks for $1.825m. The acquisition has been made by Reel Media, which itself was acquired before Christmas for $7.25m in total.
Background checking services provider ClearStar (CLSU) traded in line with expectations in 2017. Revenues were 11% higher at $17.8m and the loss was reduced. There was net cash of $1m. The loss should be further reduced in 2018.
Masawara (MASA) and Kimberly Enterprises (KBE) both plan to leave AIM. Two shareholders own 90% of Masawara. Minority shareholders are being offered 25p a share or the chance to convert the shares into preference shares. Eastern European property investor Kimberly has net liabilities of €24.1m and sold most of its property assets. The lease agreement for the Marina Dorcol project has been terminated.
Allergy Therapeutics (AGY) has completed the enrolment of its 560 plus patient phase III trial for a treatment for patients with allergic rhino conjunctivitis due to birch pollen. The results of the trial should be available before the end of this year. The potential market is worth around £3bn.
Two large clinical trial contracts have been delayed and this means that Cambridge Cognition (COG) 2017 revenues will be 18% lower than expected. This means that there will be a loss for the year.
Telematics equipment and services provider Quartix (QTX) pleased the market by growing its 2017 revenues by 5% to £24.4m. This means that earnings per share forecasts have been raised from 11.8p to 12.3p.
Geospatial software company 1Spatial (SPA) has won a five-year contract from the state of Michigan in the US worth $766,000. Liontrust has sold all its 9.35% stake.
Xeros Technology Group (XSG) has launched its domestic washing machine that can cut the use of water, detergent and energy by up to 50%. A second development agreement has been signed with a commercial washing machines manufacturer.
Oracle Power (ORCP) is acquiring the minority stake in coal mining lease owner Sindh Carbon Energy for up to £3.6m in shares.
APC Technology Group (APC) has acquired electronic components distributor First Byte Micro for £1.2m. In 2016, First Byte made a pre-tax profit of £194,000 on revenues of £1.3m.
Reconstruction Capital II (RC2) has acquired stakes in two funds that own 60% of Romanian paints and coatings supplier Policolor. This will mean that Reconstruction Capital II has an effective stake of 55.36% in Policolor and make it easier to liquidate the investment.
BOS Global (BOS) wants to raise £1.2m at 1.25p a share to settle debts and provide working capital. The software company says the directors will not be paid until April and one of them, William Giles, will subscribe up to £300,000 in the placing and open offer.
Connemara Mining (CON) has announced drilling results from the Mine River gold project in Wicklow and Wexford. Most of the intersections contained gold at grades of less than 1g/t but two were more positive with 4.53g/t over eight metres and 16.1g/t over two metres.
Versarien (VRS) is collaborating with an Asia-based global textiles manufacturer on incorporating graphene into fabrics via yarns and finishes.
E-commerce-focused cash shell AIQ Ltd (AIQ) soared as trading commenced on the standard list and trading in the shares had to be suspended after three days. There appear to have been nearly 1.4 million shares traded over three days, which is 2.8% of the shares in issue. Cayman Islands-based AIQ, raised £3.6m after expenses, at 8p a share. The suspension price is 125p. That means that the quotation and £3.6m in cash are valued at £62.5m. The plan is to seek an e-commerce acquisition, which has a strong management and is near to cash generation.
Bio-decontamination products supplier Bioquell (BQE) has completed the £122,000 disposal of the UK AirFlow parts and manufacturing business and received the final £70,000 for the sale of the service business. There was already net cash of £14.5m at the end of 2017. Full year revenues were better than expected at £29.3m, up from £26.8m and pre-exceptional profit will be much better, even before the £250,000 gain on the Airflow disposals. The 2017 figures will be published on 7 March.
Software supplier Gresham Technologies (GHT) says 2017 revenues were 24% ahead to £21.3m and more of these revenues are coming from Clareti enterprise data integrity software. There is £8.5m in the bank. Kestrel has trimmed its stake from 14.9% to 12.5%.
BATM Advanced Communications (BVC) has won a cyber communication technology contract with a government worth $4m over 12 months. Delivery will start in the second quarter of 2018.
Thomas Charlton has further increased his stake in North Midland Construction (NMD) from 7.24% to 8.2%. This appears to have sparked a recovery in the share price.
Avocet Mining (AVM) has deferred the completion the sale of its Burkina Faso assets for $5m. The buyer, the Balaji group of companies, wants more time to settle a claim from International Royalty Corporation, a creditor of the holding company of the assets. Avocet has received a deposit of $500,000.
Bluebird Merchant Ventures Ltd (BMV) has announced the results of preliminary grab samples from the Gubong gold mine. The majority of samples had gold grades of more than 1g/t and silver grades of 10g/t or more.
Zenith Energy Ltd (ZEN) has entered an exclusivity agreement for the acquisition of production and exploration licences in a Central Asian country. Azerbaijan-focused Zenith would be acquiring assets in a proven petroleum system and they produce 250 barrels of oil per day.
Rainbow Rare Earths (RBW) has started drilling at the Gakara project in Burundi. Gakara has an estimated in situ-grade of 47%-67% total rare earth oxide. The drilling is focused on the production area at Gasagwe and anomalies that have been identified. The first results will be in April. A second phase of drilling is planned later in the year and this could produce a JORC-compliant resource before the end of 2018. Production is building up and the run rate target for the end of 2018 is 5,000tpa. In December, Rainbow raised £2.8m at 14p a share in an oversubscribed placing. The cash will be used to acquire capital equipment.
Gowin New Energy Group Ltd (GWIN) is moving into the tea market, where its chief executive already has experience. Gowin intends to buy a 15% stake in a Cayman Islands-registered tea business and this new business will link up with experience of the industry that are based in Taiwan. The plan is to raise £5m from a preference share issue at 2p each, with an initial £2m raised, and use part of this cash as a loan to the new business. There will be a fixed annual preference dividend of 2%, while the loan will geerate 3% a year.
Walls & Futures REIT (WAFR) raised £1m when it joined the NEX Exchange Growth Market. There was £843,000 in the bank at the end of March 2017 and since then £475,000 has been spent on a building in Stroud that is being rented to a supported housing operator. The private rented housing portfolio, which is properties in the Wimbledon area, is worth £2.15m and the group NAV is £2.98m, equivalent to just over 90p a share. The focus is supported housing and there are plans to raise more cash from a placing and open offer in order to fund more property purchases.
Lombard Capital (LCAP) is close to finalising a 7.5% 2020 unsecured loan note series 2 issue to raise between £500,000 and £3m. This will be invested so that it provides a fixed income and capital return.
An impairment charge against the book value of the Royston Hill property meant that Etaireia (ETIP) lost £622,000 last year. The company expects to complete the purchase of properties at the Whitehouse Office Park having secured bridging finance. The current portfolio of properties should generate enough income to make the company profitable.
Block Energy (BLOK) has raised £250,000 at 0.85p a share and this cash will be used to finance the proposed move to AIM. Block has also issued 70 million shares to complete the acquisition of the 90% working interest in the Satskhenisi production sharing agreement in Gerogia. This means that Iskander Energy owns 13.3% of Block.
Healthcare recruitment company Positive Healthcare (DOC) reported revenues of £7.8m and a loss of £276,000 between November 2015 and March 2017. The two majority-owned subsidiaries were included for nine months.
Andrew Sparrow is replacing Malcolm Ball as chief executive of WMC Retail Partners (WELL). Crossword Cybersecurity (CCS) has appointed Rob Johnson, a former senior investment director at AIM-quoted Mercia Technologies, as chief operating officer.
Primorous Investments (PRIM) has made six investments in the past month and four of them are seeking to join AIM in 2018. Primorous has invested £400,000 in a £5.25m fundraising for software company Engage Technology Partners and £200,000 in online shopping and rewards firm WeShop. The other two potential AIM flotations are the investee companies Sport:80, where £100,000 was invested, and TruSpine Technologies, where £500,000 was invested to help TruSpine’s minimally invasive spine stabilisation devices to gain FDA clearance.
Doriemus (DOR) has filed a prospectus for an ASX listing. A 400-for-one share consolidation has been completed in advance of the listing. The new investing policy is focusing on oil and gas assets in Asia Pacific.
IT healthcare software and services provider EMIS (EMIS) reported a 1% increase in interim revenues to £79.2m even though the healthcare market is tough, particularly when it comes to hospital services. EMIS’s recurring revenues were 84% of the total. Profit was slightly lower. There could be a small fall in full year profit but the 10% increase in interim dividend to 12.9p a share indicates the strength of cash flow and the longer-term potential. Net cash was £10.5m at the end of June 2017. The newly created patient division is a growth area and the patient.info website is still being developed so that ecommerce revenues can be earned.
Digital TV software provider Mirada (MIRA) has secured a SaaS-based contract with ATN International and four of its cable networks in the Caribbean. In the past Mirada has been paid every time a viewer signs up for the service but this contract is based on recurring subscriber fees. There will still be an initial upfront payment for implementation services but the rest of the revenues will be generated on a monthly basis. Mirada is expected to release its 2016-17 annual report before the end of September so trading in the shares should not have to be suspended. Mirada will require additional working capital facilities and these are being negotiated.
MP Evans (MPE) is acquiring a 10,000 hectare estate in Indonesia for $108m, including the assumption of $20m of debt. This will be funded by the sale of the company’s minority stake in another estate. Infrastructure spending will cost a further $30m over five years. The estate is just starting to build up production and it will become more significant in a couple of years time. NAV is £11 a share and Peel Hunt expects this to rise by more than 5% a year as group production increases.
South America-focused gold miner Orosur Mining Inc (OMI) generated $9.7m from operations in the year to May 2017 thanks to lower operating costs and a higher gold price. There was net cash of $3m at the end of May 2017. Since the year end, Orosur has raised £3.2m at 14.7p a share and two new institutions invested in the placing. This will help to finance drilling at the Anza gold project in Colombia.
The administrator of Fairpoint Group (FRP) is selling off parts of the group but there is no chance that shareholders will get anything. Consumer claims business IVA Assurance is being sold for £450,000 plus cash balances on completion. Allixium, another consumer claims company, has been sold for £53,000. The original Debt Free Direct business has been sold to Aperture Debt Solutions for £1.34m but unlike the rest of the proceeds this cash will pay Debt Free Direct creditors rather than the creditors of the holding company. Legal subsidiary Simpson Millar has sold Simpson Millar Financial Services to its boss for £271,000 plus up to £250,000 over five years. This cash will go back into Simpson Millar.
Stockbroker Share (SHRE) will be paid £900,000 for work carried out relating to a potential partner that is not going ahead with a deal. Trading continues to be strong.
Pawnbroker and foreign currency services provider Ramsdens Holdings (RFX) says that its pre-tax profit will be higher than expected this year. This is thanks to strong foreign exchange trading results and a higher gold price.
Samuel Heath & Co (HSM) has appointed former Zeus Capital director Ross Andrews as a non-executive director.
Real Good Food (RGD) says that EBITDA will be half its previous, already downgraded, expectations at £1m. The company is in discussions with its bankers to change the conditions of its bank facility.
Educational services provider Wey Education (WEY) says revenues will increase from £1.5m to at least £2.4m and this will enable it to make a maiden pre-tax profit. There is still £909,000 in the bank. The figures for the year to August 2017 will be published in October. David Massie has taken his £33,000 annual salary in shares at 3.88p each.
Conroy Gold & Natural Resources (CGNR) has appointed Dr Karl Keegan and Brendan McMorrow as non-executive directors. Another general meeting has been requisitioned by Patrick O’Sullivan, who owns 28% of Conroy, and it will take place on 6 October. He had asked for assurances that new directors would not be appointed. The previous general meeting successfully removed six directors but Conroy said the proposed appointments of Patrick O’Sullivan, Paul Johnson and Gervaise Heddle did not comply with the company’s constitution and they are being proposed as directors again. A hearing will be held at the High Court in Dublin on 14 September and that could affect whether the three people are upheld as directors prior to the new general meeting. The plan is also to remove Professor Richard Conroy and Maureen Jones from the board.
Galileo Resources (GLR) has raised £1.09m at 2p a share to finance a joint venture with BMR Group (BMR) to develop the Star Zinc project in Lusaka, Zambia and also to finance exploration of the gold property in Nevada and the Glenover phosphate project in South Africa. Galileo had £1.1m in the bank at the end of March 2017. Galileo will lend $592,000 to BMR, which will be received once there is a settlement agreement with Bushbuck Resources for the acquisition of Star Zinc. This loan will eventually be swapped for 51% of the joint venture and $100,000 will be placed in escrow. Galileo can then increase that stake to 85% by funding $250,000 of work on the project.
Back office optimisation software provider eg solutions (EGS) has signed a five year master supply agreement that will be worth at least £8.12m. This will kick-in next year and increases the order book of recurring revenues to £22.9m. In the year to July 2017 revenues were at least £10.5m.
Cyber security software provider Defenx (DFX) has raised £1.25m from a convertible bond issue to add to the £1.74m raised from a share issue at 160p each. Defenx was trying to raise up to £2m via a bond auction carried out by UK Bond Network.
Robin Williams has taken over as chairman of FIH Group (FIH) and the company continues to seek acquisitions. There was £15.25m in the bank at the end of August 2017. Trading is expected to be flat this year with modest growth in the UK but quiet trading in the Falkland Islands with additional retail competition. The low oil price is too low to prompt development of oilfields around the islands.
Trading technology provider TechFinancials Inc (TECH) reported a dip in interim revenues from $9.86m to $6.97m mainly due to lower software licencing income. Pre-tax profit fell from $1.33m to $282,000. There was cash of $5.81m in bank at the end of June 2017.
BATM Advanced Communications (BVC) is beginning to reap the benefits from past investment and the second half should show even more progress. Revenues have started to grow even though the corresponding first half included more significant sales of older networking products. Overall group interim revenues were 10% ahead at $49.8m with both divisions increasing their revenues. There was a 17% increase in R&D spending to $4m. There was an interim loss but Shore Capital still believes that BATM can break even this year.
Ross Group (RGP) continues to seek an acquisition that would provide a more significant business for the company. In the six months to June 2017, revenues grew 51% to £93,000, while the pre-tax profit was one-fifth higher at £17,000. The balance sheet is weak with net debt of £6m but the major shareholder is supportive. That level of debt might put off some potential acquisition targets.
Standard list shell Stranger Holdings (STHP) has signed non-binding heads of terms with Irish sustainable utility company Alchemy Utilities. This acquisition would be a reverse takeover. Alchemy is involved in waste to gas production, renewable energy and using waste energy to remove salt from water to produce drinking water (www.alchemyutilities.ie). Trading in the shares was suspended at 1.38p.
Standard list shell Derriston Capital (DERR) had £2.2m left in the bank at the end of June 2017. Derriston has changed its investing strategy from a focus on medtech to technology and high growth sectors.