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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.
Western Selection (WESP) maintained its NAV at 95p a share at the end of the six month period of December 2017. Net debt was £1.13m. A sharp upturn in the value of the stake in Bilby (BILB) and offset declines in other investments. The interim dividend is unchanged at 1.1p a share. The shares go ex-dividend on 8 March.
Gledhow Investments (GDH) has granted six million options to its directors and company secretary. Guy Miller and Brett Miller will receive 2.5 million options each and Geoffrey Melamet receives 1 million. The exercise price is 1p a share. They last for five years and would equate to 10.9% of the enlarged share capital if taken up. The current share price is 1p (0.75p/1.25p). Gledhow had a NAV of £714,452 at the end of September 2017, which is equivalent to 1.45p a share. Since the year end, a gain of £115,000 was achieved on the sale of Coinsilium shares and Gledhow retains a significant stake which in Coinsilium, where the share price is more than three times the level at the end of September 2017. That could add more than £100,000 to the Gledhow NAV but the Coinsilium share price is volatile. Directors and company secretary remuneration was £21,514 last year. There are 4.9 million warrants exercisable at 1.5p each but these expire on 6 March 2017. Bruce Rowan and related parties own 83.37% of the current share capital.
IMC Exploration (IMCP) is continuing with its plans to move to the standard list. IMC has signed heads of agreement with Trove Metals Ltd and this should lead to a joint venture for the project at Avoca, County Wicklow. The current Koza/IMC joint venture has been set aside. IMC has decided to focus on the 12 most prospective of its 15 licences.
Crossword Cybersecurity (CCS) says that its revenues more than doubled to more than £700,000 in 2017. There is customer interest in the Rizikon cyber security product and the General Data Protection Regulations will provide momentum when they come into force in May. Full year figures should be published by the end of April.
Sandal (SAND) says that radiators supplier Pitacs will be a distributor of the Energie MiHome range. Pitacs is launching a new boiler in April and the Energie MiHome thermostats and radiator valves can be sold with this. Pitacs supplies more than 2,000 independent plumbers’ merchants as well as Plumb Nation.
Angelfish Investments (ANGP) says that its investee company Rapid Nutrition plans to gain a quotation in London. Rapid, which is already quoted on the SIX Swiss Exchange, has developed a nutraceutical product range. One of the terms of the £150,000 loan to Rapid was that it should be admitted to the London market by the end of February but this date has been extended to the end of April because of delays in the flotation process. If admission to the market happens by 1 March, then the principal and interest will convert into Rapid shares. If it takes longer than the interest after the end of February is payable in cash.
BWA Group (BWAP) has issued £220,000 of 4% convertible loan notes, with £120,000 taken up by Bath Group, which is owned by BWA chairman Richard Battersby. Bath has taken £70,000 of the loan notes in lieu of cash owed by BWA investee company Mineralfields Group.
Trevor Lloyd has succeeded Philip Kirkham as chairman of National Milk Records (NMR).
Kryptonite 1 (KR1) has changed its name to KR1.
Shield Therapeutics (STX) disappointed the market with phase III patient trial results for the use of Feraccru in the treatment of iron deficiency anaemia in patients with chronic kidney disease that did not meet statistical significance requirements. The results are being analysed in order to identify the reason the trial failed. The share price fell by two-thirds.
Diversified Gas and Oil (DGOC) expects to complete the acquisition of Appalachian producing gas and oil assets from CNX Gas by the end of March. This will cost $85m (£59.9m), while the acquisition of Alliance Petroleum will cost a further $95m (£66.9m). A placing at 80p a share has raised £133.1m. The group’s net working interest production will increase by 173% to 28,133 boed. Management expects annualised EBITDA to be $70m-$75m.
OnTheMarket (OTMP) joined AIM on 9 February having raised £30m at 165p a share. The share price ended the day at 148p. The online property portal operator will make significant investment in its business over the next two years and this will lead it to fall into loss for a couple of years.
Draper Esprit (GROW) has made three new investments. Evonetix is developing the ability for parallel synthesis of DNA on silicon arrays. Droplet Computing has developed technology to decouple applications from the operating system for online and offline use. Kaptivo is developing products to provide whiteboard live streaming and image capture.
Seeing Machines (SEE) has published a trading statement to try to reassure investors following the unexpected departure of its chief executive. Interim revenues will be greater than the A$13.6m reported for last year. The fleet business is gaining revenues internationally. There is growing interest in the driver fatigue technology from Transport for London.
Recruitment software provider Dillistone (DSG) says that its 2017 figures will be much better than expected. This led to a pre-tax profit upgrade from £200,000 to £300,000. This is still a depressed figure due to the investment in GatedTalent and the future of the business depends on the take-up of this new product.
Engineering and technology recruiter Gattaca (GATC) says that weakness in the technology sector will hold back its progress and its chief executive has resigned. Underlying pre-tax profit is set to decline for a second year while the dividend could be halved to 11.5p a share in order for its to be twice covered.
Trading in the shares of BOS Global Holdings (BOS) remains suspended because of the resignation of RFC Ambrian as nominated adviser. BOS still does not have enough working capital so it cannot publish its 2016-17 annual report because the uncertainty over the AIM quotation scuppered a £1.2m placing.
Trading in Kennedy Ventures (KENV) shares will recommence on 12 February following the publication of its annual report. There was a cash outflow of £2.76m in the year to June 2017. The Namibia Tantalite Investment Mine run by African Tantalum has made its fourth shipment of tantalum to its North American customer and there are two more potential customers.
Croma Security Solutions (CSSG) says its first half figures will be much better than those reported for the first half of last year. The EBITDA will improve from £440,000 to more than £1.1m. The company’s largest ever contract was won at the end of the period. There has been an increase in demand for personnel from Croma Vigilant and it has won a five year contract. There is also improved demand for technology supplied by Croma Systems. The interims will be published in February.
BNN Technology (BNN) will lose its AIM quotation on 12 February. A matched bargain facility will be set up. The remaining board hopes to do at least one deal with the two US-listed companies it is in discussions with concerning the acquisition of all or most of BNN’s business.
Strategic Minerals (SML) has extended its access to the Cobre magnetite stockpile in New Mexico until the end of March 2019. This will provide cash to finance other projects.
Origo Partners (OPP) has sold 4.7% of Jinan Heng Yu Environmental Protection Co Ltd for the equivalent of $3m. This is in line with book value but it may take many months for the cash to be received. Origo retains a 7.2% indirect stake. The Origo NAV was $0.09 a share at the end of June 2017.
Alba Mineral Resources (ALBA) has secured additional exploration licences in Greenland. The 466 square km of land is in north west Greenland. Exploration work can be combined with existing licence areas.
Mercantile Ports and Logistics (MPL) says its port in Mumbai will receive its first revenues in a few weeks, following delays in the first customer sorting out its logistics. A further 200 metres is being added to the quay on the east flank of the facility.
Physiomics (PYC) has won a £70,000 contract from a major pharma company. The company’s Virtual Tumour computer model will be used for helping to predict outcomes in pre-clinical testing.
Warpaint London (W7L) says its 2017 results will be in line with expectations suggesting a pre-tax profit of £9.8m and a total dividend of 4p a share.
Polarean Imaging has relaunched plans to come to AIM. It had planned to float at the end of 2017 and the new proposed date is 22 February.
Fryer management services provider Filta Group Holdings (FLTA) says its 2017 revenues were 30% higher at £13.25m. The sale of the refrigeration business should increase the group margin.
TechFinancials Inc (TECH) has pulled out of the sale of non-core operations because the buyer had still not obtained regulatory approval.
Cadmium-free quantum dots producer Nanoco (NANO) has secured a material development and supply agreement with a major US firm that will provide funding to expand Nanoco’s manufacturing site in Runcorn. The deal covers the production of nano-particles for electronic devices. Commercial supply should commence in 2019.
Dukemount Capital (DKE) has secured a two month extension to its option on a property in north west England while talks with a housing association continue. Plans for the refurbishment of the building will be presented to the housing association. Gary Carp has increased his stake from below 3% to 5% in the past fortnight.
Flying Brands Ltd (FBDU) is negotiating to buy a North American medical imaging software developer, which owns FDA-approved medical imaging software that fits well with Flying Brands; own software. The cost of £500,000 would mainly be financed through a share issue.
Avocet Mining (AVM) has completed the sale of Resolute (West Africa) for $5m.
Path Investments (PATH) is still intending to raise cash and move to AIM in the first quarter of 2018. The farm-in deal to acquire 50% of Alfeld-Elze II licence and gas field in Germany is expected to go ahead in the near future.
Chuk Kin Lau has increased his stake in book publisher Quarto Group (QRT) from 20% to 25.6%. Cavendish Asset Management nearly halved its stake to 3.69%.
Newbury Racecourse (NYR) says that raceday attendances are 29% so far this year and no meetings were lost to the weather. Conference and events revenues have been maintained despite the refurbishment of the racecourse. Occupancy levels are building up at on-site hotel The Lodge. The Rocking Horse nursery has increased revenues by 29%. The pre-parade ring and saddling boxes are completed and the Owners’ Club conference and wedding venue will be finished in the late summer. Further improvements will begin later this year. The first home owners have moved into the residential development, which will take until 2021 to complete. Newbury is involved in the new racecourse controlled betting pool from July 2018.
Coinsilium Group Ltd (COIN) has signed a memorandum of understanding with hedge fund HyperChain Capital. This will lead to co-investment opportunities in blockchain companies. Singapore-based HyperChain predominantly invests in tokens, which has proved more profitable than direct investment in companies in recent times – see Kryptonite 1. The two investors are each invested in social trading crypto platform CoinDash, which is about to launch a token offering.
Kryptonite 1 (KR1) has made a profitable turn on tokens in blockchain-related investments, some of which were acquired four months ago. The company sold 6,407 Melonport tokens for £33.17 each, raising £212,520, compared with the buying price of £3.87 each providing a profit of just over £187,000. The 2,105,254 tokens acquired in the Golem project were sold for an average price of 27p each – 27 times the original investment – raising £569,418 and representing a gain of just over £548,000. Kryptonite 1 has tax losses, which it should be able to use to offset against the total gains of £735,000. A small amount of the cash raised has been reinvested in 126,796.5 tokens in the initial coin offering of the Mysterium project – a peer-to-peer, server-less virtual private network.
Property investment company Ace Liberty & Stone (ALSP) is paying an interim dividend of 1p a share. The shares go ex-dividend on 22 June.
Peterhouse has resigned as corporate adviser to African Potash Ltd (AFPO), which has also completed the acquisition of a 21% stake in Advanced Agricultural Holdings in return for 221.6 million African Potash shares (11.8% of the enlarged share capital).
NEX Exchange Company of the Year
Here are the companies on the shortlist for NEX Exchange Company of the Year which will be awarded at the 2017 Small Cap Awards on 22 June.
£33.6m @11750p (11500p/12000p)
Brewer and distributor Adnams has been around the longest of the five nominees for this award and it is also much larger than any of the others. Adnams, which sponsored last year’s Tour of Britain cycling event, continues to invest in its brewery with beer sales moving above 100,000 barrels in 2016. More of that beer is being sold in kegs. The £7m investment in the brewery is almost complete.
In 2016, revenues improved from £65.7m to £70.3m, while pre-tax profit increased from £4.07m to £5.02m, predominantly down to a rise in asset disposal gains from £625,000 to £1.43m. The NAV has fallen to £27.5m because of an increase in the pension liability. There is a dividend of 150p per B share and 37.5p per A share.
So far this year, sales of beers and spirits continue to grow and Adnam’s pubs are trading well, although the sale of smaller pubs will reduce the profitability of this part of the group. Currency movements, the sale of the UK distribution rights for Lagunitas beers and the renovation of the Swan Hotel will hamper overall progress in the first half. This year there will be the first beer duty tax increase in four years.
Capital for Colleagues (CFCP)
£6.9m @45p (40p/50p)
Employee ownership-focused investment company Capital for Colleagues has not had a smooth ride in the past year with a major investee company going bust but it is still able to attract more cash from investors. Capital for Colleagues raised £1.44m at 42p a share from its recent open offer and a further £980,000 in a placing at the same price.
One of the group’s employee-owned investee companies FJ Holdings sold its businesses and was placed in administration. Capital for Colleagues was not kept up to date with these moves. The figures for the six months to February 2017 show the aftermath of this loss. The profit from ongoing activities improved from £40,000 to £159,000 but the write-off for FJ of £1.32m, more than one-fifth of the previous asset value, meant that there was a loss of £1.16m. The NAV fell to 43.5p a share at the end of February and this will be slightly diluted by the subsequent fundraising.
There remains strong demand from companies wanting to encourage employee ownership and the Capital for Colleagues management has, excluding FJ, a good record.
Chapel Down Group (CDGP)
£94.9m @94p (90p/98p)
English wines producer Chapel Down has been one of the most high-profile companies on NEX. Revenues grew by one-quarter to £10.2m in 2016. The Tenterden-based wine business grew revenues by 22% and the brewing operations increased revenues by one-third.
Brewer Curious Drinks separately raised money to build a new brewery but Chapel Down still effectively controls the business – although it is now classified as an associate in accounting terms. The Ashford brewery will be open in mid-2018 and this will free up space for wine making at Tenterden.
Continuing operations moved from an underlying pre-tax profit of £156,000 in 2015 to £340,000 in 2016. Gross margins on the wine business improved from 40% to 43%. More premium wines are being launched this year.
Some of the Chapel Down vineyards were hit by frosts in late April but there will be firmer evidence of any effect this month. However, management says they were the worst April frosts in two decades.
Crossword Cybersecurity (CCS)
Crossword Cybersecurity is developing cyber security products with six UK universities. A blockchain-related Ministry of Defence smart documents contract was won with the University of Warwick and cyber risk product, Rizikon, which uses expertise from City University, has started to generate revenues.
Crossword is also involved with CyberOwl, a spin-out from Coventry University that is commercialising research into the early warning of cyber attacks. CyberOwl has been selected to join GCHQ’s Cyber Accelerator.
In May, Crossword Cybersecurity took advantage of the high profile of cyber security problems to raise cash at a large premium to the market price. Crossword raised £145,000 at 230p a share. Brenlen Jinkens took up 50% of the new shares and he has 5.13% of the company.
In 2016, revenues jumped from £21,000 to £345,000 but the loss increased from £755,000 to £950,000 – even after £78,000 of R&D tax credits. There was £1.55m in the bank at the end of 2016. AIM-quoted Iomart is cooperating with Crossword on launching the Nixer machine learning Denial of Service (DDoS) platform on the market.
£4.9m @ 29.5p (28p/31p)
Sandal is a developer and manufacturer of energy efficiency and other electronic products. It has signed a number of agreements with retailers and distributors for its Energenie MiHome range, which is also being integrated with a number of home automation systems, including those of Google and Amazon. Retailers selling the company’s products include Argos, Sainsbury, Robert Dyas, Shop Direct Group and Ocado.
Recently, Sandal signed an agreement with Spanish smart home technology business Momit, which will redesign its smart thermostat so that it is compatible with the Energenie MiHome platform. This is part of Momit’s strategy to enter the UK market. The redesigned product should be launched in September and, along with related radiator valve sales, could add £500,000 to Sandal’s annual revenues.
In the six months to November 2016, revenues were 13% ahead at £1.88m, with Energenie MiHome products growing revenues by 74%, and the pre-tax profit has improved from £7,000 to £35,000. Further growth is expected in the second half as home automation becomes a more mainstream product area.
PrimaryBid.com is helping Myanmar International Ltd (MIL) to raise between $3m and $5m. The Myanmar-focused investment company is offering shares at $1.18 each – a 9.2% discount to the market price. Myanmar wants to widen its shareholder base. The proceeds are expected to be invested within six months. This is the 23rd offer by PrimaryBid and it closed at 5pm on 18 June.
Disruptive Capital says that it is not going to make on offer for Stanley Gibbons (SGI) because it was not given the information it required, although the stamps and coins dealer has effectively put itself up for sale. A strategic review has commenced and the formal sale process is part of this.
Wynnstay Properties (WSP) has kept up its record of increasing its dividend. The 19% rise took the total dividend to 15.75p a share. The NAV was 15% ahead to 674p a share at the end of March 2017.
Home improvements company entu (UK) is taking longer to turn around than was hoped. There were problems with installation capacity, which is not enough to meet demand but there are also problems with the supply chain. The underlying interim loss is likely to be similar to the restated loss in the first half of 2016. There will also be a full year loss. Net debt was £6.5m at the end of April 2017. The boilers and energy switching businesses have been closed and the LED business scaled back.
FIH Group (FIH) reported a 4% increase in 2016-17 revenues to £40.5m, while underlying pre-tax profit fell from £3.1m to £2.4m. The profit decline was not as great as originally expected.
Egdon Resources (EDR) is acquiring a 50% interest in PEDL278 in the East Midlands, with the other 50% being acquired by the proposed operator IGas (IGAS). The licence area includes a tight gas discovery from 1985.
Keras Resources (KRS) says drilling at the Warrawoona gold project in Australia, which is now part of Calidus Resources, has commenced. Calidus Resources is about to join ASX.
Savannah Resources (SAV) has received approval in principle for a tailings storage facility at the abandoned Lasail West pit in Oman. There is still potential for further copper mineralisation at the Lasail copper mine. It is taking longer than expected to gain licensing approval for the copper mine development at Mahab 4 and Maqail South. Mining should still start in the first half of 2018.
Italian PR firm SEC (SECG) reported a decline in revenues in 2016 as markets are growing slowly and competition is fierce. There was also a lack of large one-off events. Revenues fell from €21.2m to €18.5m, while pre-tax profit has slumped from €3.25m to €734,000.
Starcom (STAR) has secured a three-year, $1.5m equipment and tracking order. Shiptek Solutions is paying $1.2m for Tetis R container tracking units and there should be at least $250,000 of income from online tracking services over three years.
IT consultancy and resourcing firm Triad Group (TRD) believes that the appointment of Arden as broker in February “is a significant step in returning the group to its former glory”. In the year to March 2017, revenues improved from £28.3m to £30.9m and pre-tax profit increased from £863,000 to £1.52m. Net cash was £2.24m. Triad intends to build up business outside of the public sector and increase exposure to new technologies, such as blockchain. Triad is returning to paying a dividend with the latest pay out of 0.5p a share. The ex-dividend date is 10 August. The trustee in the bankruptcy of former boss Mira Makar has been selling down her shareholding, which was over 21% but it has been reduced to 17.4%. The share price has held up over the past couple of months despite this.
Storage and communications semiconductors developer CML Microsystems (CML) increased full year revenues by one-fifth to £27.7m and organic growth was 14%. Underlying pre-tax profit improved from £3.5m to £4.3m. The dividend was increased to 7.4p a share. R&D investment continues to increase but there is plenty of cash to fund this. Net cash was £12.5m at the end of March 2017.
Industrial fasteners supplier Trifast (TRI) increased its pre-tax profit by more than one-quarter to £20.5m, which was better than expected. Growth is coming from the top 25 key accounts and new product launches.
Flying Brands Ltd (FBDU) has completed the acquisition of kidney stone analysis company Stone Checker Software in return for the issue of eight million shares at 3p each and been readmitted to the standard list on 16 June. A placing raised £550,000 at 3p a share. Stone Checker was previously 50%-owned by AIM-quoted Feedback (FDBK), which licenced its TexRAD software to the company for use with kidney stones.
North Midland Construction (NMD) has been awarded a joint venture infrastructure contract for Severn Trent Water on the Birmingham Resilience project worth more than £100m. This contract will be split between North Midland and its joint venture partner. The scheme starts in the third quarter of 2017 and this means that the 2017 figures will be ahead of expectations.
Jacek Slotala has stepped down as a director of fully listed shell Highway Capital (HWC). He joined the board in December 2015. Trading in the shares has been suspended since 22 September 2016. Highway has been seeking a significant acquisition for approaching two decades.
London and south east England residential property developer St Mark Homes (SMAP) says it will in the immediate future focus on homes for sale for less than £600,000, because this is the London help to buy limit. In 2016, revenues fell from £3.1m to £1.34m but the unchanged contribution from joint ventures and a release of negative goodwill of £150,000 – a non-cash item – meant that pre-tax profit improved from £549,000 to £652,000. There is still negative goodwill of £137,000 on the balance sheet which is likely to boost a future financial year. A lower tax charge helped earnings per share to rise from 14.8p to 16.6p. Total dividends were 11% higher at 5p a share. There was a cash outflow from operations in the period. The NAV is £5.8m, following a share issue that raised £690,000 net of costs via an open offer to existing shareholders. That is 131p a share. Finance director Sean Ryan acquired 4,912 shares at an average price of 94p each.
Markets operator WMC Retail Partners (WELL) benefitted from an increased valuation of its Luton market but trading was down on the previous year. In 2016, revenues dipped from £4.31m to £4.23m, including £100,000 of consultancy revenues, and a pre-tax profit of £13,000 was turned into a £58,000 loss. WMC is on course to reopen its Cornish site under the name Cornucopia in July.
Property developer Formation Group (FRM) moved back into profit at the interim stage based on continuing operations. Revenues doubled from £10.2m to £20.2m, while an operating loss of £84,000 was turned into a profit of £48,000. The corresponding period also included a £1.08m write-back of loans secured on past properties. There was £1.58m in the bank at the end of February 2017. The NAV was £10.4m.
Block Energy (BLOK) says that Schlumberger has completed the acquisition of three production sharIng contracts in the Republic of Georgia that are near to Bock’s own interests. This indicates the interest in the region. Roger McMechan has been appointed as technical manager for Block’s interests.
Investment company Early Equity (EEQP) increased its interim loss from £46,000 to £67,000. The NAV fell from £770,000 to £639,000 at the end of February 2017. The value of investments in BWA Group and Alpha Prospects declined and the investment in Devilfish Poker was written off, although it is hoped that there could eventually some value to the shareholding. Yicom Global, a healthcare products supplier primarily focused on China, has been increasing its number of sales agents and sales.
Coinsilium Group Ltd (COIN) says that nano-payments company SatoshiPay has linked up with PayPal so that 200 million users could potentially use its service. Coinsilium has a 12.1% stake in SatoshiPay.
Milamber Ventures (MLVP) has paid £75,000 for a 15% in Essential Learning, which provides apprenticeship training. The UK Apprenticeship Levy is expected to generate £2.8bn to be invested in training. In the nine months to April 2016, revenues were £616,000 and lost nearly £30,000. Share placings at 16p a share and 20p a share raised a total of £75,000.
Wheelsure Holdings (WHLP) has raised £500,000 at 1p a share and it hopes to raise a further £50,000. Management says that the economic climate has delayed sales of its Tracksure rail safety components and Wheelsure is short of cash to develop the business. The cash is needed for marketing, product development and patent protection. There are trials of products in process. Wheelsure is focusing on generating more sales from existing customers while targeting longer-term sales from new customers.
Karoo Energy (KEP) has raised £465,000 at 3p a share. These investors will receive a warrant exercisable at 6p a share for each share they subscribed for. The warrants last for 36 months. The cash will be used for shale gas exploration in Botswana.
A strong end to the financial year means that Bilby (BILB) expects to report EBITDA of at least £3.6m, compared with a forecast of £3m. The building services provider says that demand was strong at the end of the financial year with some work starting earlier than expected. There is a cash balance of £2.5m. The figures for the year to March 2017 will be reported before the end of June.
Mortice (MORT) has sparked another profit forecast upgrade following a trading statement. House broker finnCap has increased its 2016-17 pre-tax profit forecast from $4.3m to $5m and next year’s forecast has been raised from $6.2m to $7m. Revenues are better than expected and costs have been kept under control. Net debt was $13.6m at the end of March 2017. The facilities management and security divisions both generated much higher revenues.
Gemfields (GEM) has received an unsolicited bid from 47.1% shareholder Pallinghurst Resources. The offer is not generous. Pallinghurst is offering 1.91 of its shares for each Gemfields share. That is equivalent to 38.5p a share or a total value of £211.5m.
Veltyco Group (VLTY) did even better than expected in 2016. Revenues were 7% ahead of forecast at €6.1m. Underlying pre-tax profit was €1.74m and Northland forecasts a 2017 profit of €4.27m, helped by recent acquisitions. The online gaming marketing business has started 2017 strongly.
RNA therapeutics developer Silence Therapeutics (SLN) has gained a European Patent Office grant for its chemical modification technology and expects to use this patent to generate revenues from specific medicines that are already undergoing clinical trials.
A recovery in oil and gas demand has helped Hardide (HDD) in the first half. Revenues increased by 59% to £1.51m. The underlying operating loss fell from £1.02m to £720,000. Production is building up at the new US facility. Sales are yet to come through from the approvals already given by Airbus Group. A $100,000 order has been received from General Electric.
LightwaveRF (LWRF) reported a slightly reduced interim loss on revenues that grew from £804,000 to £1.17m. The loss fell from £384,000 to £333,000. The home automation business has developed technology and it needs to generate higher sales in order to move into profit. A partnership with Google in the voice control area has propelled the share price upwards.
ImmuPharma (IMM) says that the latest clinical trial results show that Lupuzor, a potential treatment for Lupus, has a robust safety profile. The phase III trial of 200 patients has been going on for 52 weeks and the full results should be available in the first quarter of 2018.
Tiso Blackstar Group SE (TBGR) is selling its 22.9% stake in industrial holding company KTH back to the company. The payment of around £86m will be paid over 19 months with £7m due before the end of 2017 and the rest by the end of 2018. Tiso Blackstar will repay its debt of £23m and a special dividend of £2.3m. The rest of the cash will be reinvested in media investments. There are plans to move the listing in South Africa from AltX to the Main Market. The company is also moving its registered office from Malta to the UK.
Management has announced a potential bid for recruitment company InterQuest Group (ITQ) but the independent directors are not impressed. Chisbridge Ltd is offering 42- a share. The two independent directors say the offer undervalues the company.
Brave Bison (BBSN) has approached Zinc Media (ZIN) and merger discussions are underway. Herald Investments has stakes in both companies.
Edenville Energy (EDL), which operates the Rukwa coal project in Tanzania, has signed a letter of intent to supply 1,000t of coal/month and this could increase to 7,000t/month. This should hopefully be followed by a formal coal supply agreement so that deliveries can start in July.
Tissue Regenix (TRX) is in talks to acquire US-based regenerative medicine company CellRight Technologies.
Flying Brands Ltd (FBDU) says that the prospectus relating to the acquisition of kidney stone analysis company Stone Checker Software has been approved by the authorities. A placing has raised £550,000 at 3p a share.
Yujin International (YUJ/HPR) intends to switch from AIM to ISDX following the proposed acquisition of Healthperm Resourcing and also change its name to Healthperm Resourcing Ltd. Yujin joined AIM in February 2009 when it operated a maritime business that has subsequently been sold. Healthperm supplies nurses from the Philippines, where there are estimated to be 200,000 unemployed nurses, to healthcare providers in the UK and UAE. Potential customers want to employ around 1,000 nurses, while the current pipeline of 180 candidates for the NHS could generate £970,000 for the company. There will be a 91-for-two share consolidation and £275,000 will be raised after consolidation at 150p a share. Healthperm will cost an initial £11.2m in shares at the subscription price and if pre-tax profit is at least £2.9m in 2017 a further £4m will be paid in shares at the same price. There were no revenues up until the end of 2015.
Former AIM company Black Sea Property plans to join ISDX on 31 August. Black Sea Property originally joined AIM on 14 March 2005 but the property portfolio was completely disposed of by July 2014 and cash returned to shareholders. Trading on AIM was cancelled in January but the shareholders voted to continue as a property company and domicile was moved from Jersey to the Isle of Man. The strategy is to build up a portfolio of Bulgarian property assets. This could be residential, commercial or hotel properties, or it could be investments in distressed companies that need to be restructured. AG Asset Management will be investment adviser and its holding company owns 28.7% of Black Sea Property and has provided a loan facility of £350,000.
Secured Property Developments (SPD) still has £760,000 in the bank following the sale of its property asset. There was a £17,000 loss in the first half of 2016. The board is seeking investments, which include the possible funding of property developments.
Early Equity (EEQP) says that 32.1%-owned Malaysian business Yicom Global made a profit in its most recent financial year and Early Equity will receive a dividend totalling £26,000. The Chinese healthcare products supplier reported a net profit of RM 850,000 (£161,000) on revenues of RM4.06m (£768,000). Yicom started trading in February 2015.
Australia-based explorer NQ Minerals (NQMI) has raised £113,000 at 8.4p a share. Geologist Roger Jackson has joined the board. He has options over 4 million shares at 6p each.
Tracsis (TRCS) says that full year underlying profit will be in line with expectations thanks to strong second half revenues helping full year revenues to grow by one-quarter to £32m. The stated profit will be reduced by acquisition and disposal costs. There was more than £11m in the bank at the end of July 2016. Tracsis has made a joint investment in Nutshell Software with the former majority shareholder in Ontrac, which was acquired last year. Nutshell develops apps for transport, utility and energy businesses. Tracsis is investing £500,000 for a stake in Nutshell of up to 37.8%.
Call centre services and technology supplier IPPlus (IPP) says that it will make a modest pre-tax profit in the year to June 2016. The Ansaback call centre services provider won a substantial call centre contract. The secure payments business also won new contracts and transaction volumes rose by 46%. There were lower revenues from software. There was £900,000 in the bank at the year-end.
Capital equipment manufacturer Molins (MLIN) made a small underlying profit in the first half of 2016 but it is still paying a dividend even though it has been halved to 1.25p a share. There are continued delays in receiving orders and that could hamper the normally strong second half. Tony Steels became chief executive in June.
Mass spectrometry instruments developer Microsaic Systems (MSYS) has raised £5.4m at 5p a share in order to progress the commercialisation of instruments and make manufacturing more efficient. There was £1.95m in the bank at the end of June 2016 but there was a cash outflow of more than £1.6m in the previous six month period.
Cash shell Flying Brands Ltd (FBDU) continues to work on the reverse takeover of medical technology business Stone Checker Software. There was a £125,000 cash outflow, including a £62,000 loss from fraudulent activity, in the six months to June 2016. Directors’ fees have been accrued since 1 April 2016. There is still £196,000 in the bank. Tweeter Leon Hogan has built up a 5.1% stake.
Blockchain technology investor Coinsilium (COIN) has raised £1.15m of the £1.5m it is seeking via crowdfunding site Seedrs.com. Coinsilium has also raised additional cash via a placing ahead of a potential flotation on ISDX. There are still 39 days to go for the crowdfunding. Coinsilium already has a portfolio of eleven investments. Blockchain technology groups digital transactions into blocks that can be accessed easily and provides a permanent record of transfers of assets. This means that transactions can be verified and reconciled without the need for a centralised third party.
Property investor Ace Liberty & Stone (ALSP) has completed the sale of the remaining units of Telephone House in Sheffield. The property is owned by a 38%-owned associate but it was consolidated in the Ace figures. The latest disposal proceeds were £4m taking the amount raised from the site to £8.1m. Ace will receive £2.2m, which includes a profit of £456,000. This can be reinvested in other properties. The strategy is to acquire properties with short-term tenancies with government or other blue chip tenants. These are properties that can be converted into residential or student accommodation, or other new uses. Once planning is approved then Ace will probably sell them on to developers, although it could choose to develop some sites itself. Dr Abdel-Karim El-Rousstom has bought 2 million shares and Hikmat El-Rousstom 2.91 million shares at 2.75p each. That raised £135,000 for Ace and takes their stakes to 18.7% and 2% respectively.
Online secondary school operator and consultancy Wey Education (WEYP) wants to raise £1.75m as part of a move to AIM on 7 December. The cash will be used to grow the business. At 4.5p (4p/5p) a share, Wey is currently valued at £2m.
GP software provider DXS International (DXSP) says that its revenues have increased by 42% in the five months to September 2015. Annualised revenues are £3.2m. The interims will be published in the middle of December. At 13p (12.5p/13.5p) a share, DXS is valued at £4.3m.
Green Chemicals (GNCP), which is developing cleaner and safer consumer and cleaning products, has decided to withdraw from the ISDX Growth market. The share price slumped from 22.5p to 4.5p on the news. There was one trade during the week at 2p a share. The board is asking shareholders to vote for the withdrawal in order to save £35,000 a year and in the hope that an investor in unquoted companies can be attracted. News will be published on the website (www.greenchemicalsplc.com) and broker Keith Bayley Rogers will provide a matched bargains service for the shares. Earlier this month, IP Group provided a loan facility of up to £1.5m to Green Chemicals. This can be converted into shares. IP Group along with two other associates has a total interest of 29.5%.
Diversified Gas & Oil (DOIL) has raised a further £1m (£990,000 after expenses) through the issue of 8.5% unsecured bonds 2020. This means that there will be £3.2m of unsecured bonds in issue. There should be more than £3m in total to invest in developing the company’s oil and gas assets in Ohio and West Virginia.
Structural steels supplier Billington Holdings (BILN) is adding additional capacity through the £4.85m acquisition of property and assets five miles away from the company’s Barnsley facility, which is operating at record levels. The purchase will be funded by a £2.5m mortgage and from the company’s cash pile. Capacity will be increased over a two year period as the acquired facilities are adapted to optimise production. The site has long-term tenants which generate annual rents of £400,000. Assuming the deal goes through it should add £200,000 to profit in 2016 before the benefits of the additional capacity show through.
Inland Homes (INL) has sold a major part of the former RAF Stanbridge site to Catalyst Housing Association for £14m. Inland has retained a 0.5 acre retail site pre-let to a major food retailer and another small parcel of land. The disposal will help to underpin the 2015-16 profit expectations of £16m. Inland has invested £1m in a 25% stake in housebuilder Troy Homes. Inland will also be providing a further £2m to Troy in loan notes. Troy is run by former Banner Homes boss Richard Werth. Inland has also secured a £20m revolving credit facility with Barclays, which matures in October 2019. There is scope for a further £10m to be added to the facility.
Property lettings and sales business franchisor Belvoir Lettings (BLV) says that its franchisees have made acquisitions in Southampton and Brighton, which will add network revenues of £250,000. This means that they should add £30,000 to Belvoir’s franchise revenues, plus additional interest income of £10,000 a year from the loans. Belvoir has loaned £118,500 to help finance these acquisitions. In Southampton, lettings and estate agency Langford Charles has been bought, while in Brighton a property portfolio was acquired.
Fifty Four Four Ltd, which is owned by YCO director Charles Birkett, has increased its stake in former AIM company YCO to 71% following its 1p a share bid, which valued the superyacht services provider at £485,000. Fifty Four Four already owned 50.4% prior to the bid but it does not have a high enough stake to compulsorily purchase the rest of the shares. YCO was trading at 7.25p a share prior to the announcement of its intention to leave AIM in May 2012 – it left in July 2012 and re-registered as a private company in 2014. Net cash was £2.46m at the end of 2011 following the disposal of a fuel business.
Specialist Fund Market-listed Marwyn Value Investors Ltd (MVI) has raised £50m at 220p a share with the founders Mark Watts and James Corsellis investing an additional £2m in total. The cash raised will go into the Master Fund, whose portfolio includes BCA Marketplace, Zegona Communications, Gloo Networks and Le Chameau Holdings SAS. There will be a special dividend of 2p a share paid in January and from then on the dividend will be quarterly. Last year’s dividend was 8.255p a share and this will be the minimum total payment in 2016 – not including the January dividend. The disposal of the Entertainment One stake will provide cash to distribute to shareholders. There could also be special dividends following any disposals from the portfolio. In October, Marwyn paid 24.6p a share to investors. Marwyn is trading at a 16% discount to estimated NAV of 256.3p a share.
Dr Qu Li has been appointed as a non-executive director of cash shell Flying Brands Ltd (FBDU) and she will be seeking an acquisition in the area of logistics and/or technology. LCP Consulting (http://www.lcpconsulting.com/) has been taken on to identify an acquisition. LCP has been researching city logistics, including the use of electric vehicles in order to improve air quality. Annual costs are around £70,000 and there was £247,000 in the bank at the end of October. Since then, a further £100,000 has been raised via the issue of convertible loan notes, taking the total issued to £369,800. The new loan notes are convertible at 1.5p a share.
Aminex (AEX) has signed a disposal and farm out agreement for its Tanzania oil and gas assets with AIM-quoted Bowleven. The deal will raise cash of $8.5m and Aminex will receive $5m of shares in Bowleven, which it will have to retain for at least nine months. Bowleven is buying a 25% stake in the Kiliwani North development licence and earning a 50% gross interest in the Ruvuma PSA. Aminex will have a net carry of $10m on Ruvuma activity. Aminex is also entitled to a bonus of $500,000 in cash when drilling is completed on the Ntorya-2 well and $4m in cash or shares when Ruvuma has been in production for at least 30 days. Current partner Solo Oil is entitled to 25% of the net carry and 25% of the bonus for Ruvuma. Aminex will be able to reduce its debt but it remains as operator of the assets with 30.575% in Kilwani North – Solo can purchase a further 6.5% stake from Aminex – and 37.5% of Ruvuma. The deal has to be approved by Aminex shareholders and by Solo.
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