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National Milk Records (NMRP) increased its interim revenues from £10.5m to £11.7m, although some of this was due to seasonal factors and one-off testing business. Pre-tax profit improved from £0.96m to £1.13m. Net debt was £2.06m at the end of December 2018. Every part of the business grew its revenues. Milk volumes are set to be strong in the second half, although milk margins are been squeezed by a decline in the milk price and higher feed costs.
Barkby (BARK) has completed the acquisition of Centurian Automotive for an initial payment of £201,000 in shares at 4.775p each, with up to £251,000 more based on performance over three years. Operating profit in each of the years is required to be at least £200,000 in order to achieve the full payment. The consideration represents a discount to net assets and will be equivalent to up to 20% of Barkby. In the year to March 2018, the automotive dealer made a pre-tax profit of £123,000 on revenues of £5.6m.
Sandal (SAND) says there was a significant increase in Energie MiHome sales in December, particularly later in the month, but trading is still below expectations because of a lack of cash to spend on marketing. The stock overhang has been unwound. A Wi-Fi adapter plug has been added to the range, which is being rolled out in Denman’s Electrical Wholesale branches.
Sport Capital Group (SCG) owned Palermo Football Club for less than one month before selling it back to the previous management team. It was bought for a nominal sum and is being sold for a nominal value, following further due diligence. The company’s representatives joined the board in December and resigned last week. Debt will be settled at the same time. Sports Capital had been trying to raise up to £20m over the next few months.
Trading has recommenced in the shares of EcoVista (EVTP) after it published its results for the year to August 2018. There was a £142,000 property revaluation gain and net assets were £1.39m. There are plans to launch a €10m Eurobond issue to fund further property site acquisitions in London, Hertfordshire and Essex.
Gold explorer Tectonic Gold (TTAU) has completed stage one drilling on the Specimen Hill project in Queensland and each hole drilled intersected gold. Geological modelling results will be available in March. A further 7,500 metres of drilling is being planned.
Auxico Resources Canada Inc (AUAG) has raised $400,000 at 20 cents a unit (one share and one-half warrant). The expenses of the placing were $28,000. The cash will be used for assessing coltan opportunities in Colombia and Brazil. NQ Mining (NQMI) has raised £54,000 at 11p a share.
Panoply Holdings (TPX) has made its third acquisition since floating in December. UK-based GreenShoot Labs provides digital services using artificial intelligence technology. There is no initial consideration and any payment will depend on performance.
Marketing and media services provider Ebiquity (EBQ) traded in line with expectations last year. The disposal of the advertising intelligence was completed on 2 January. This cut net debt to around £8m. The continuing business is expected to continue to grow at 8% a year.
Online merchandising software and services provider ATTRAQT Group (ATQT) increased its 2018 revenues by 26% to £17.1m and the loss declined from £4.1m to £2.7m. The largest customer has renewed for two years. Annual recurring revenues are £16m.
GRC International (GRC) has acquired data consulting business DQM Group for an initial £5.9m with up to £5m in deferred consideration, although it is not expected to be more than £3.5m. This is a significantly earnings enhancing deal.
Cabot Energy (CAB) is consolidating 100 shares into one new share and raising up to £2.85m at 10p per consolidated share. The cash will pay off trade creditors. The main focus is Canada but Cabot believes its Italian oil and gas exploration assets could still be valuable even though the Italian government has suspended exploration work and is reviewing the situation.
The administrator has sold most of the businesses of Patisserie Holdings (CAKE) but there will be no money for shareholders. Dublin-based Causeway Capital has acquired Patisserie Valerie and AF Blakemore acquired Philpotts for a total of £13m, of which £3m is deferred. Baker and Spice was sold to the Department of Coffee and Social Affairs for £2.5m. The AIM quotation will be cancelled on 25 February. Paul Mumford of Cavendish Asset Management believes that the company’s banks should have supported a rescue and been more attentive to what was happening at the company. He thinks that shareholders should seek compensation from the banks.
Malvern International (MLVN) has confirmed that it moved into profit in 2018. The education business has doubled its London-based revenues and this made up for difficult trading in Malaysia.
Realm Therapeutics (RLM) is selling is hypochlorous acid assets for $10m and intends to leave AIM. Realm already had $18.8m in the bank at the end of 2018. The plan is to use the cash to complete a strategic transaction in the life sciences sector. The ADSs will continue to be listed on Nasdaq.
Stride Gaming (STR) has started a strategic review. The choices are acquisitive or organic expansion or the sale of the online gaming company.
Renalytix AI (RENX) has secured a joint venture with laboratory and clinical trials operator AKESOgen and this will enable Renalytix AI to provide additional services in the US. The artificial intelligence-based kidney diagnostics already has a presence in New York and the new joint venture is based in Georgia.
Administrators have been appointed to Utilitywise (UTW) but none of the subsidiaries is in administration. Shareholders are not likely to get anything from the administration process. Unitlitywise was unable to raise the cash it required to keep going and meet liabilities.
Heavitree Brewery (HVT) improved full year revenues from £7.3m to £7.61m and pre-tax profit grew from £1.55m to £2.25m, although that included profit on the sale of pubs and other property of £824,000, up from £6,000. The previous year had benefited from the write-back of a bad debt provision. The final dividend is being increased from 4p a share to 4.25p a share. Heavitree no longer has to cover a pension scheme deficit because three people transferred out of the scheme.
Bowmark Capital has launched a 110p a share recommended cash bid for Tax Systems (TAX) and MXC Capital Ltd (MXC) has accepted with its 25.6% stake. The bid values the tax software provider at £100.6m.
Kodal Minerals (KOD) has published the results of the drilling programme at the Bougouni lithium project. These will be used to update the JORC resource, which should happen by the end of February. Kodal has met with the Mali authorities to update them.
Insignals Neurotech is the third Portuguese spin out for Frontier IP (FIPP) and it will hold a 33% stake. Insignals is developing technology for brain stimulation surgery.
Scientific Digital Imaging (SDI) has made another scientific instruments acquisition and it has raised £2.5m at 34p a share to help finance it. A further £100,000 was raised via PrimaryBid. Graticules manufactures reticules and graticules and fits with the digital imaging division. It cost £3.4m and has added 6% to next year’s earnings per share.
Strategic Minerals (SML) has announced a trebled resource at Redmoor, in which it has a 50% stake. There is an inferred tin equivalent contained metal of 137,000 tonnes.
James Latham (LTHM) has acquired the timber merchant that has the rights to sell Accoya wood in Ireland. Abbey Woods will cost an initial €1.825m with a further €300,000-€400,000 depending on completion accounts. Further deferred consideration of up to €400,000 depending on performance over two years. Last year, Abbey Woods generated EBITDA of €379,000 on revenues of €7.5m and it has operations in Dublin and Cork.
Vast Resources (VAST) says that the tranche B offtake finance from Mercuria Energy Trading did not happen. This means that the planned December and January repayments of the loan from Sub Sahara Goldia Investments have not been made Talks continue with potential finance providers to replace the cash to invest in 80%-owned copper, silver, gold, zinc, lead, tungsten, molybdenum Baita Plai project. Bergen Global Opportunities Fund is pausing the second tranche of the $3m bridge facility because the share price has been below 0.2p for two days. A placing has raised £896,000 at 0.135p a share and this will repay the £525,000 owed to Bergen. There are discussions with a potential cornerstone investor for a diamond project in Zimbabwe.
RiverFort Global Opportunities (RGO) has subscribed for shares in Pires Investments (PIRI), that will give it a 24.3% stake. RiverFort is taking nearly 50% of the shares issued in a placing that raised £782,000 at 2.4p a share for Pires. The cash will be used for new investments.
Trading in the shares of African Battery Materials (ABM) will resume on Monday 18 February following the issue of 200 million shares at 0.5p each. The cash will be used to pay creditors and leave enough to finance the business for 12 months. Andrew Bell has been appointed executive chairman and Paul Johnson as executive director.
Windar Photonics (WPHO) will undershoot the 2018 forecast, but there should be higher orders from Vestas and another manufacturer next year. Even so, 2019 forecasts are likely to be reduced. Total 2018 revenues were 59% ahead at €3.5m and higher gross margins meant that the loss before interest, tax, depreciation and amortisation fell from €1.22m to €360,000. The end of year order book was worth €1m.
Nostra Terra Oil and Gas (NTOG) has more than trebled its proved and probable reserves to 2.43 million barrels of oil. Net proved reserves are 764,030 barrels of oil.
President Energy (PPC) has updated the reserves position. The Argentina and Louisiana reserves are valued at almost $300m, which is equivalent to 21p a share. That is more than twice the market capitalisation. Production is predominantly oil but gas production will increase this year.
Harwood Wealth Management (HW.) has acquired IFA Castleton Financial Planning for up to £1.6m.
Trading in the shares of Urals Energy (UEN) has been suspended following the resignation of Allenby as nominated adviser. A general meeting, which will be held on 22 February, has been called by Adler Impex SA in order to remove three directors and appoint four other directors. Oil production was 1,690 barrels/day in January. Loans made without board approval have meant that the company is short of cash.
Waste-to-energy technology developer PowerHouse Energy (PHE) is confident that it could sign up a customer in the next quarter. There is increasing interest and six potential sites are being assessed. Potential engineering, procurement and construction contractors have approached PowerHouse. Development partner Waste2Tricity is in negotiations with Toyota Tsusho, which would be a way of entering the Japanese market.
Braveheart Investment Group (BRH) has reduced its stake in Remote Monitored Systems (RMS) from 5.9% to 1.32%. Stephen Jones increased his stake from below 3% to 14.5% in just over one month.
Dewscope Ltd, where Mark Horrocks is a director, has cut its stake in Sabien Technology (SNT) from 12.7% to less than 3%. Chris Akers has also reduced his stake from 16.9% to less than 3% and Brendan Adams has cut his shareholding from 4.2% to under 3%. These stakes were acquired on 14 December, when the mid-price was 0.11p. On 11 February, when the shares were sold, the share price increased from 0.145p to 0.175p. Sabien reported a decline in interim revenues from £462,000 to £342,000, but the loss was reduced from £233,000 to £207,000 due to cost reductions.
TV programme producer DCD Media (DCD) expects to report revenues of £7.3m and a small EBITDA in 2018. Trading has started well in 2019 helped by business that was delayed from last year.
HaloSource (HAL) is seeking shareholder approval for the disposal of assets to Strix (KETL) for $1.3m. The cash will pay creditors and fund the winding down of the business. The AIM quotation will be cancelled on 12 March.
WANdisco (WAND) has raised $17.5m at 546p a share to provide cash to support relationships with partners. WANdisco has become an advanced technology partner with Amazon Web Services.
Adamas Finance Asia Ltd (ADAM) is issuing 6.1 million shares to China Aerospace for a 6.8% stake in Hong Kong Mining Holdings, where Adamas already has a 84.8% stake. This is a complicated deal, but Adamas can tell China Aerospace where to transfer these shares. It means that Adamas will not necessarily increase its shareholding in the mining company. Sorting out what was effectively a stock overhang should make it easier to do a deal that will unlock cash for Adamas.
NetScientific (NSCI) has concluded its strategic review and it has decided to cancel its AIM quotation. The remaining cash will be spent on the investee companies with the best prospects of providing a return before the company runs out of money.
Angus Energy (ANGS) is repaying the £1.5m initial advance from YA II and RiverFort Global Opportunities. Angus has raised £2.2m at 4p a share.
The University of British Columbia has ordered a polariser system from Polarean Imaging (POLX).
Begbies Traynor (BEG) has made the earnings enhancing acquisition of profitable Newcastle insolvency practice KRE. The initial payment is £450,000 with up to £150,000 more based on revenue targets over 12 months.
Full year figures will be lower than expected at IFA Tavistock Investments (TAVI) but a maiden dividend is still on the cards.
Crossword Cybersecurity (CCS) will report a 45% increase in 2018 revenues, with most of the growth coming from software.
Cryptocurrency mining services provider Argo Blockchain (ARB) is refocusing its business. All existing contracts will be terminated by the beginning of April. The focus will be Argo’s own currency mining. Ongoing costs will be cut by one-third. Net cash is £15m and that is much more than the market capitalisation of Argo. The cash outflow should be stemmed in the second half of 2019. Hadron Capital recently increased its stake to 7.6%.
Trading is in line at fasteners supplier Trifast (TRI) even though the UK automotive market is weak. More than two-thirds of sales are overseas. Additional UK stocks for Brexit are worth around £2m.
Commercial aircraft leasing company Avation (AVAP) expects to report a doubled interim profit on revenues that have risen from $52.4m to $58m.
Outdoor digital media company Grand Vision Media Holdings (GVMH) has signed a partnership agreement with Rakuten Bank in Japan to add to the one it signed with CY Group in South Korea. GVMH’s marketing services will help its partners promote themselves to Chinese tourists. GVMH has glasses-free 3D technology.
Helen Sachdev has been appointed as a non-executive director of Athelney Trust (ATY) and Frank Ashton has taken on the role of executive chairman. Discussions continue with Gresham House Asset Management about taking over the management of the company’s investments.
Future (FUTR) has secured a new £90m revolving credit facility and it is acquiring CyclingNews.com and Procycling Magazine, which generate annual revenues of £2m. This deal widens the sports publishing activities.
REA Holdings (RE.) significantly increased palm oil production in 2018, even though extraction rates were lower than expected. The Kota Bangun coal concession is heading towards reopening the mine, although there are local disputes.
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.
Commercial property investor Ace Liberty and Stone (ALSP) has launched an open offer of convertible notes and warrants to raise up to £4.85m. The conversion price is 25p a share, while the warrants are exercisable at 80p a share. The closing date is 22 January.There are already commitments for £3.01m. Additional cash is required to make more property purchases.
Good Energy (GOOD) chairman John Maltby has invested £100,000 in the renewable energy supplier. He acquired 58,000 shares at 173p a share.
In the six months to September 2017, Via Developments (VIA1) increased its operating income from £309,000 to £557,000 but still made a small loss. There were net liabilities at the end of the period.
Positive Healthcare (DOC) made a maiden profit of £64,000 on revenues of £4.67m in the six months to September 2017. The year end is being changed to March. The healthcare staffing business continues to control costs.
Technology company incubator Milamber Ventures (MLVP) reported an increase in interim loss from £196,000 to £263,000. Milamber has launched the Milamber Education Technology Fund and has completed the acquisition of healthcare training company Essential Learning. The education sector will be increasingly important to Milamber.
Hot Rocks Investments (HRIP) reported a decline in NAV from £901,000 to £853,000 in the year to September 2017. Hot Rocks has 14 investments in oil and gas, mining and pharma companies.
Stanley Gibbons (SGI) put out its interim results just before the end of the year, thereby avoiding suspension. In the six months to September 2017, revenues fell from £17.3m to £16.6m, while the loss fell from £6.36m to £3.09m. The stamps business continues to lose money and the profit from coins was lower.
Avanti Communications (AVN) was another company bringing out results just days before trading in shares would have been suspended. The satellite communications operator’s revenues fell from $82.8m to $56.6m. There was net debt of $562m at the end of September 2017, which was before the refinancing plans. David Williams will step down as chief executive after March.
Telit Communications (TCM) says that its main bank has granted a waiver for breach of covenants at the end of 2017.
Parallel Media has completed the acquisitions of Brick Live and Parallel Live for £10m and changed its name to Live Company Group (LVCG). The previous businesses have been sold. There was £1.26m raised at 30p a share and £2.03m of debt was capitalised.
A net gain on its investment portfolio enabled Legendary Investments (LEG) to report an interim pre-tax profit of £248,000. The gain was on the stake in business services software supplier Virtual Stock Holdings. There was a net cash outflow from operations of £28,000. The NAV was £5.22m at the end of September 2017.
Clear Leisure (CLP) is injecting its 4.53% stake in 3D mapping company Geosim Systems Ltd into a new subsidiary company that will also be launching a joint venture called Miner One to develop bitcoin mining blockchain data centre. Clear Leisure will invest €200,000, lent by Eufingest, a 10% plus shareholder in Clear Leisure, for 50% of the joint venture. The new subsidiary will be used to acquire other IT business and could eventually be spun-off in order to gain its own quotation.
Thor Mining (THR) has appointed exploration manager Richard Bradley to the board. The definitive feasibility study for the Molyhil tungsten/molybdenum project should be finalised in the first quarter of 2018. A mineral resource estimate is expected for the Kapunda copper project is due early in the year.
Clean water technology company HaloSource (HAL) says that the Chinese government has halted production facilities in the region that supplies its glass pitchers so fulfilment of orders for JiuBan will be delayed. This means that 2017 revenues will be up to $3m and the loss will be up to $5.5m. There should be revenues of at least $840,000 from JiuBan in 2018.
Alliance Pharma (APH) has completed the purchase of Vamousse from TyraTech Inc (TYR) for an initial $13m plus additional payments of up to $4.5m. The human head lice treatment has been developed by TyraTech and it has built up Vamousse as an international brand. The deal is earnings enhancing for Alliance and provides TyraTech with the cash to develop animal health products. TyraTech launched a tender offer of up to $8.5m. The tender offer price is 3p a share. Alliance will be able to distribute Vamousse through its existing European and international partners.
Kestrel Partners is building up a shareholding in STM Group (STM) and just before Christmas it took its stake to 3.72%.
Oil re-refiner HydroDec Group (HYR) has extended the repayment date of three facilities to the end of 2018 and one of them has been increased by £500,000. The facilities are provided by director Andrew Black.
Oracle Power (ORCP) has raised £621,000 at 2.3p a share and broker Brandon Hill has exercised warrants at 0.65p each, which raised £150,000.
Silence Therapeutics (SLN) has sold further shares in Arrowhead Pharmaceuticals, taking the total sale proceeds to £17.2m ($23m). The total cost of the Arrowhead stake was £9.2m ($11.3m) and Silence still owns 472,509 shares.
TechFinancials Inc (TECH) will invest $200,000 for a fully diluted 2% stake in Cedex Holdings, a Blockchain-based diamonds exchange. There is also an option to acquire a further 90%, fully diluted, stake at an exercise price of $40,000. These stakes could be diluted by other share issues.
Copper and gold producer Rambler Metals and Minerals (RMM) has amended its offtake agreement with Transamine Trading, which is making a $4m advanced payment in return for a right of first refusal on any offtake agreement for five years from January 2022. The advance payment plus interest is repayable over 18 months. The phase II expansion is nearly complete and this will extend the mine life by 20 years.
EQTEC (EQT) has completed the acquisition of Eqtec Iberia for £14m in shares just over five months after it was announced. The acquisition owns the EGT gasification technology. EQTEC also raised £1.6m at 0.65p a share.
China New Energy Ltd (CNEL) is holding general meeting on 17 January In order to gain permission to buy back up to 20% of the shares in issue. This could benefit the share price, which currently has a modest rating given the profitability of the business.
New Trend Lifestyle Group (NTLG) is selling its remaining China-focused business for £100 and concentrating on Singapore. The Feng Shui business continues to trade poorly and is seeking acquisitions in Asia.
Xeros Technology (XSG) has completed its £25m placing at 225p a share. The polymer technologies developer will use the cash to further develop cleaning, tanning and textile technologies.
Gresham House (GHE) is selling its Newton-le-Willows property for £2.1m. The completion of the sale of legacy assets will have raised more than £18m. Gresham House should qualify for IHT exemption.
Summit Therapeutics (SUMM) is acquiring Discuva, which is a developer of antibiotics using a bacterial genetics based platform. Summit is paying £5m in cash and £5m in shares for Discuva but no employees will be taken on. Summit will still have enough cash to last it until the end of 2018.
Aquatic Foods Group (AFG) has been unable to publish its accounts and it has lost its AIM quotation.
URU Metals Ltd (URU) had £1.84m in cash at the end of September 2017. The first drill results for the Zebediela nickel and copper project in South Africa have been published and the drill results for the most recent three holes are due in January. URU also has a 9.7% stake in AIM-quoted Management Resource Solutions (MRS).
Draper Esprit (GROW) has made a gain of £7.2m on its stake in Clavis Insights, having originally invested £8.1m in December 2016. This gain will add 3p a share to NAV. Clavis, which is an e-commerce data analyser, was acquired by Ascential for $119m.
Windar Photonics (WPHO) has received a new order from its Chinese distribution partner for five WindVision LiDAR systems. Windar has already delivered 50 systems.
World Trade Systems (WTS) has reached agreement with Germany-based Naturemed and related companies about the commercialisation of its personal hygiene and healthcare products and it will also help to obtain Chinese registration for them. WTS has signed a five year lease on a London office. Shares in WTS are still suspended.
Over the top video streaming business Falcon Media House (FAL) made initial revenues of £232,000 in the six months to September 2017. The interim loss was £2.71m. Since then, £3.4m has been raised from a convertible loan note issue.
Rockpool Acquisitions (ROC) still has nearly £385,000 in the bank. Negotiations are continuing concerning the possible acquisition of Greenview Gas Ltd.
Good Energy (GOOD) received applications for £16.7m of the corporate bonds on offer. The maximum application level was £20m. The energy supplier will issue the bonds on 30 June. At the company’s AGM, Martin Edwards was not re-elected as a non-executive director and four special resolutions, three relating to pre-emption rights and one about calling a general meeting at 14 days notice, were not passed. Edwards has been a director of Good Energy since its formation and has expertise in renewable energy generation. It is unclear whether the length of his time on the board was held against him by institutions or whether there was another reason for him being removed from the board. He was chairman of the remuneration committee.
South Africa-based social impact investment company Inqo Investments Ltd (INQO) says that occupancy rates of its core investment Kazuko Lodge are improving and it moved into profit last year. The weakness of the Rand has helped to boost tourist demand and room rates. In the year to February 2017, Inqo revenues increased from R10.7m to R17m and a loss of R4.72m was turned into a pre-tax profit of R10.3m, thanks to a rise in other income from R867,000 to R14m. Net cash was R2.3m at the end of February 2017. This year, the first revenues from Bee Sweet Honey and retirement savings scheme provider Four One Financial Services are anticipated.
Housebuilder St Mark Homes (SMAP) is paying an interim dividend of 5.5p a share. The shares go ex-dividend on 6 July.
Phoenix UK has bought out a rival shareholder in Hornby (HRN) and this has triggered a mandatory bid at the purchase price of 32.375p a share. This purchase took Phoenix’s stake in Hornby to 55.2%. The bid values Hornby at £27.4m. Neither Hornby’s management nor Phoenix wants to lose the AIM quotation. The bid closes on 14 July.
Wynnstay (WYN) reported flat interim pre-tax profit of £4.07m prior to the goodwill write-down on the Just for Pets retail business. Pet retailing is a competitive market and it is consolidation. Just for Pets is relatively small and it loss has masked an improvement in the core agricultural division and the Wynnstay Sores retail business. A recovery in the milk price means that farmers are back in profit and are spending more money on feed. Net debt was £8.28m at the end of April 2017, which is higher than last time because of the rise in commodity prices. The interim dividend was increased by 5% to 4.2p a share. The full year profit is forecast to decline from £7.4m to £7.1m.
NWF (NWF) also benefited from a recovery in feed demand in the second half of the year to May 2017, although there was a decline in the year as a whole. The food and fuel distribution businesses both made improved contribution. The full year figures will be published on 1 August.
South America-focused gold miner Orosur Mining Inc (OMI) says that operating costs were between $800 and $900/ounce last year. In the year to May 2017, Orosur produced 35,371 ounces of gold, which is at the lower end of the expected range. There was net cash of $2.9m at the end of May 2017 even though a new underground mine has been developed. Orosur plans to commence a drilling programme in Colombia, while the deadline for a decision by Asset Chile on whether to back phase II of the Anillo project has been extended to the end of 2017, although Orosur can talk to other potential backers.
Timber importer James Latham (LTHM) reported better than expected full year figures. In the year to March 2017, revenues were 7% ahead at £199m and gross margins improved. Earnings per share were 4% higher at 55.8p and the total dividend is 15.35p a share, up from 14.3p a share. Net cash was more than £16m. Revenues were 3% higher in the first two months of the current financial year.
InterQuest Group (ITQ) continues to advise against acceptance of the bid from Chisbridge, which is a management backed takeover vehicle. Acceptances of the 42p a share cash bid have been received from shareholders owning 2.85% of InterQuest, which is added to the 40.5% of the share capital that already backed the bid. The offer has been extended to 13 July.
European Wealth Group (EWG) is raising £6.14m at 12.8p a share and could raise up to £3.07m more via an open offer to existing shareholders. The cash will be used to pay off debt and deferred consideration.
Tracking and security equipment developer Starcom (STAR) has raised £650,000 at 1.5p a share, with each share coming with one-fifth of a warrant exercisable at 2.5p a share for up to 12 months. Some of the cash will be used to pay $246,000 to YA II, which will reduce the drawn down convertible loan facility from $330,000 to $110,000. YA II has agreed to a conversion price for the rest of the facility of 2.5p a share up until the end of 2017.
Redx Pharma (REDX) has a chance of securing the funds it requires in order to come out of administration. Discussions are still at an early stage. It is unclear whether this will involve changes to management, given that the current management believed that it could string along Liverpool City Council and put off repayment of its loan. Redx has gained UK Medicines and Healthcare Products Regulatory Agency approval for oral cancer treatment RXC004. This provides permission for a phase Ib/IIa study for gastric, biliary and pancreatic cancer patients.
Clontarf Energy (CLON) is in talks to secure further projects and additional finance. Clontarf was recently awarded block 18, offshore Equatorial Guinea.
Myanmar International Ltd (MIL) raised a total of $7.3m via PrimaryBid.com and institutions, having initially wanted to raise between $3m and $5m. The Myanmar-focused investment company offered shares at $1.18 each – a 9.2% discount to the market price. Myanmar has achieved a broadening of its shareholder base. The enhanced proceeds are still expected to be invested within six months.
Digital media content business Brave Bison Group (BBSN) has appointed Claire Hungate, a former chief operating officer of ex-AIM TV production company Shed Media, as chief executive but she does not join the company until September. Brave Bison says that it does not believe a merger with fellow AIM company Zinc Media is in its interests.
Water treatment company HaloSource (HAL) has finally completed a £1.8m fundraising at 1.5p a share. The cash will provide working capital to help expand the drinking water business and develop the lead removal technology. The cash will fund the group into 2018. The new shares are more than one-third of the enlarged share capital. The completion of the conditional fundraising was announced on 21 April. There is no mention in the latest announcement of the investor that had tried to gain Chinese government approval to invest.
Gold producer and explorer Shanta Gold (SHG) raised £11m at 6p a share as part of a refinancing that also includes a new $50m debt facility to replace the existing $40m facility. Shanta is acquiring TSX Venture Exchange-quoted Helio Gold, which has gold exploration assets near to Shanta’s own licences, for $5.6m in shares. Shanta will be able to finance the commercial underground production phase at its New Luika gold mine.
Thor Mining (THR) has raised£460,000 at 0.9p a share and there is one warrant with each new share which is exercisable at 1.8p a share. Thor has agreed to acquire 25% of US Lithium, which has interests in Arizona and New Mexico, from Pembridge Resources for £59,000 and £30,000 will be provided to cover operating costs. There is an option to acquire the other 75% for 52.8 million shares at a deemed price of 0.9p each. Thor has completed a 50 hole drilling programme on the Dundas gold project in Western Australia. The results should come through in a few weeks.
First, the good news from TLA Worldwide (TLA). Management is obviously trying to suggest that it does not have contempt for investors by releasing a profit warning at 7am – its advisers must be doing something right. This is certainly a big improvement on publishing a profit warning at 6.26pm on 23 December 2016. TLA still thinks that it will be able to report its 2016 figures and post its accounts on 30 June. However, the trade receivables write-off is going to be higher than the previous guesstimate of $1.5m-$2.5m. The write-off is expected to be $3.2m and on top of that the negative effect of the accounting corrections on EBITDA is likely to be $3.6m, up from $2m previously. That will leave 2016 EBITDA at $4.8m. The interest charge will take up the majority of that figure. It is not just that, though. The original 2015 profit will be reduced by $1.9m. Net debt was $21.8m at the end of 2016 but a large chunk of the receivables that should have helped to reduce that figure are not going to come in. There is no dividend – unsurprisingly. The finance director has left, although he will be providing assistance for three months.
Superyacht painting and maintenance services provider GYG (GYG) is raising £6.9m at 100p a share prior to joining AIM on 5 July. GYG is valued at £46.6m at the placing price and the plan is to pay an annual dividend equivalent to 6.4% of the placing price, although it will be 3.2% for 2017. Last year, GYG generated revenues of €54.6m and made EBITDA of €6.7m.
China-focused healthcare investor Cathay International Holdings (CTI) says that it will receive just over $4m in dividends from 50.56%-owned subsidiary Lansens Pharmaceutical. The dividend will be paid on 4 August. Lansens’ subsidiaries have received insurance payments totalling $2.58m. Two directors were not re-elected at Cathay’s AGM because, although they received the majority of votes, they did not receive the majority of independent votes. Further re-election resolutions will be proposed in the next four months and they will only need a majority to be passed.
Falcon Media House (FAL) has signed a memorandum of understanding with Tata Communications to collaborate on an over the top service for brands and content rights holders, using Falcon’s Q-Flow technology.
SMALL CAP AWARDS 2017 WINNERS
Company of the Year
Musical instruments retailer Gear4Music has gone from strength to strength since joining AIM in June 2015. The share price has risen by 600% in the past year. In May, £4.2m was raised at 690p a share.
The musical instruments market remains fragmented but Gear4Music is becoming one of the main players in Europe and it is opening distribution facilities in Europe as well as expanding its UK base. The investment required is holding back short-term profit growth and, in fact, pre-tax profit is expected to dip this year from £2.7m to £2.4m before rising to £3.3m in 2018-19.
IPO of the Year
Accrol Group Holdings (ACRL)
Tissue manufacturer Accrol had just celebrated its first anniversary on AIM when it was given this award. Accrol floated at 100p a share on 10 June 2016 and the share price has risen to 159.5p. Full year figures will be announced on 10 July.
Accrol is a leading supplier of tissue products to the discount sector and it has opened a new factory in Leyland, Lancashire. This investment takes annual production capacity to 143,000 tonnes. A ten-year lease has been secured on a 368,000 square foot warehouse in west Lancashire and this will become the central distribution facility. The warehouse management and logistics have been outsourced.
NEX Exchange Company of the Year
Chapel Down Group (CDGP)
English wines producer Chapel Down has been quoted on NEX and it forerunners for more than 14 years. Revenues have grown from £1.47m in the year to September 2002 to £10.2m in 2016. The Tenterden-based business made a small loss when it floated. Continuing operations moved from an underlying pre-tax profit of £156,000 in 2015 to £340,000 in 2016. Frosts have hit production this year but the outcome for wine production is still uncertain.
The company has developed brewing business Curious Drinks, which has separately raised money to build a new brewery but Chapel Down still effectively controls the business. The new Ashford brewery will be open in mid-2018 and this will free up space for further wine making at Tenterden.
Impact Company of the Year
African agricultural and forestry business Obtala is set to start to commercialise its operations this year. Up until now revenues have been modest but they are set to jump to £11.9m in 2017, trebling to £36.9m in 2018, which should be high enough to allow Obtala to make a profit in 2018. Hardman estimates that the Mozambique forestry assets could generate EBITDA of more than £25m in 2021. There are also plans to build up the orchard and horticultural business in Tanzania.
In May, Obtala acquired profitable sawn timber trader WoodBois International for $14.8m (£11.4m). The Copenhagen-based business sources timber from across Africa and sells it around the world. WoodBois has been short of capital to finance growth and it fits well with Obtala’s existing timber and forestry operations.
Executive Director of the Year
Nick Jarmany, Quixant (QTX)
Telematics technology provider Quartix is highly cash generative enabling it to finance growth in the UK, France and the US and pay increasing dividends. Chief executive Nick Jarmany founded Quixant in 2005 having spent more than two decades at Densitron Technologies. He guided the business to an AIM quotation in 2013.
The UK remains the dominant region for revenues but France and the US are growing strongly from low bases. Last year, US revenues more than doubled, from £256,000 to £677,000, but the loss was even higher than that because of the investment in sales and marketing and support services to enable growth over the next five years.
Transaction of the Year
Keywords Studios (KWS)
Outsourced video games services provider Keywords Studios has made numerous earnings enhancing acquisitions since it joined AIM but this award is for the purchase of Synthesis for up to €18m, which is one of eight purchases in 2016. This deal meant that Keywords became the global leader in localisation and voice-over recording for video games and added additional studios in Germany, France and Taiwan.
Keywords is expected to maintain a net cash position at the end of 2017 but this will depend on the level of acquisitions activity. There is a €35m bank facility that is not fully utilised and that could be used for further acquisitions.
Analyst of the Year
Andrew Blain, Cenkos Securities
Journalist of the Year
Jamie Nimmo, Evening Standard
Adviser of the Year
Fund Manager of the Year
Paul Mumford, Cavendish Asset Management
Malcolm Diamond (Trifast/Flowtech Fluidpower)