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Andrew Hore Quoted Micro 12 August 2019

NEX EXCHANGE

Imperial X (IMPP) non-executive director Melissa Sturgess has sold 4.615 million shares at 2p each and she retains an equal number of shares. The total stake was acquired at 1p a share, so she has effectively made her money back. Imperial X is moving into the cannabis sector. Charles Morgan, a relation of Melissa Sturgess, converted £46,150 of loan notes into 4.615 million shares.

NQ Minerals (NQMI) has invested a further £150,000 Tasmania Energy Metals through a convertible loan, taking the total investment to £450,000. The exclusivity period relating to the acquisition of an option over the company’s assets has been extended to the end of October 2019. NQ would have nine months to exercise the option in return for shares worth £5.5m. The latest investment will be used to develop a facility that would produce nickel and cobalt salts for electric vehicle batteries.

Founder Stephen Minion has resigned from the board of Ashley House (ASH) so that there are no conflicts of interest between his role as a director and his other interests. He is chairman and major shareholder of Invescare, which has provided a loan to Ashley House.

iGaming software developer Ganapati (GANP) says that its Malta-based subsidiary has signed a resale agreement with BetConstruct, which will provide the company’s slot games to its integrated operators via its platform. Another deal is with PG Entertainment and this will make Ganapati’s games available in Latin America via a smartphone platform.

Asia Wealth Group Holdings Ltd (AWLP) improved pre-tax profit from $150,000 to $268,000 in the year to February 2019, partly due to a reduction in impairment losses. The company is looking at fintech acquisitions.

The conversion of loan notes in Equatorial Mining and Exploration (EM.P) has led to the issue of just over nine billion shares. There are 24.2bn shares in issue.

Valiant Investments has changed its name to Eurocann International (BUD).

AIM  

Oil and gas company Amerisur Resources (AMER) has effectively put itself up for sale and multiple companies are interested in bidding. They are being provided confidential information. The formal sale process continues.

Execution only broker Share (SHRE) made a first half profit even though stockmarket trading conditions and volumes have been poor and the dividend from Euroclear was moved to the second half. Revenues increased 9% to £11.1m as interest income grew. Account fees have been increased. Share is benefiting from its digital investment. The 20,000 accounts being taken on from JP Morgan will contribute from September. A full year profit of £400,000 is forecast.

Credit hire and legal services provider Anexo (ANX) is trading more strongly than expected, even after previous upgrades. Management has managed to reduce insurance costs. The full year pre-tax profit forecast has been increased by 15% to £23m and next years by 14% to £25m.

Artificial intelligence-based physician platform DocDoc, where Adamas Finance Asia (ADAM) is an investor, has raised $13m. Adamas led the convertible loan note financing for the Singapore-based company. DocDoc operates in eight countries. Hong Kong-based CASIL Clearing has reduced its stake in Adamas from 6.9% to 2.9%. Pello Capital has been appointed joint broker.

Presidential Energy (PPC) is not making the progress it hoped to, but profit is improving. The share price of the Argentina-focused oil and gas company has been declining. finnCap describes its estimates for average production and EBITDA as “challenging” due to delays and disruptions. It has been forecasting EBITDA of $27.9m due to an oil price estimate that is above current levels, whereas the company believes it could be around $20m. There are no plans to change the forecast until the interims are released in September.

StatPro (SOG) increased organic annualised recurring revenues by 3.2% to £56.5m in the first half. The asset management performance software provider increased interim revenues £27.2m to £28.3m, while pre-tax profit improved from £2.37m to £2.66m due to flat operating costs. Net debt is £24.2m.

Richard Bernstein has increased his stake in Ultimate Sports Group (USG) from 27% to 29.8%. Bernstein has an agreement with Ultimate where he would receive 1% of the value of the first acquisition he introduces to the company as long as it is completed by 30 September. Matthew Farnum-Schneider has been appointed chief executive of Ultimate. He has been granted a range of options. Some are exercisable at 20p a share, which is just below the current share price, some at 40p a share and others at 60p a share. Geoffrey Simmonds has left the board.

Urban Exposure (UEX) is not going ahead with a proposed issue of 6.5% secure sterling bonds 2026 because of market conditions.  

MAIN MARKET

S and U (SUS) says demand for motor finance has been strong in the first half, even though the quality of business has been increased. The Aspen property bridging finance business has net receivables of £24m and is growing gradually in a weak housing market. Borrowings are just over £125m and there are additional facilities of £35m. The interims will be published on 24 September.

Construction company nmcn (NMCN) increased interim revenues from £161.2m to £184m, while pre-tax profit improved from £2.5m to £3.5m. The former North Midland Construction had net cash of £15.6m at the end of June 2019. The order book is worth £456m with the main increase coming from the built environment division, which accounts for one-fourth of the order value. A full year profit of £7.4m is forecast.

Iconic Labs (ICON) is making its first acquisition since transforming itself from stem cell services provider WideCells into a social media marketing business. Iconic has agreed to acquire social media agency Social Alchemist. Iconic Labs is still in a poor financial state. There are £600,000 of legacy debts that have to be paid, plus £400,000 that is disputed. The European High Growth Opportunities Securitization Fund will provide up to £1.375m in six tranches in return for loan notes. This is dependent on a prospectus being issued within six months. This prospectus will enable warrants to be attached to the loan notes. There are also more shares to be issued under the previous financing agreement.

Argo Blockchain (ARB) generated 163 bitcoins in July and these are valued at £1.36m. They were mined at a margin of 80%. More mining machines have been ordered and will be up and running by the fourth quarter. This investment will quadruple capacity. Argo could be highly profitable in the second half with a full year pre-tax profit of £6m.

Andrew Hore

Andrew Hore – Quoted Micro 25 March 2019

NEX EXCHANGE

Good Energy (GOOD) increased full year revenues from continuing operations from £104.5m to £116.9m, helped by last winter’s cold weather and a price increase, and pre-tax profit recovered from £700,000 to £1.7m. The renewable electricity supplier and generator has increased its dividend from 3.3p a share to 3.5p a share. Net debt was £40.1m at the end of 2018. Energy supply volumes increased by 3%, but domestic volumes were 1.2% lower in an increasingly competitive market. The growth came in the business side, which increased volumes by 23%. Good Energy generates energy from six solar sites and two wind farms. The company expects to continue to grow business volumes and invest in digital technology. Non-executive director Nemone Wynn-Evans has bought 9,500 shares at 105p each.

Trading in PCG Entertainment (PCGE) shares has been suspended because it is in talks to acquire VOX Markets and Align Research.

Karoo Energy (KEP) has been told by its potential nominated adviser does not believe its is suitable for an AIM quotation. This also means that the planned fundraising cannot go ahead. A refinancing is required. There are trade creditors of around £300,000. Trading in the shares has been suspended.

Primorus Investments (PRIM) has maintained its 3.4% stake in Fresho by participating in its latest fundraising, which was at a 76% premium to the price paid for the initial investment. The investment is worth A$673,000.

Dana Group International Investments Ltd (DANA) reported swing from loss of $129,000 to a profit of $95,000 in the six months to December 2018, due to other income of $276,000.

Tectonic Gold (TAU) says that roc chip samples from the Clermont project in Queensland show up to 8.01g/t gold, 140g/t silver and 6.32% copper.

Panther Metals (PALM) has completed the acquisition of Parthian Resources and its former shareholders own 16.1% of Panther.

Inqo Investments Ltd (INQO) has raised a further £225,000 at 90p a share.

Imperial X (IMPP) has changed its focus to medicinal cannabis. There was a small cash outflow in the six months to the end of December 2018. There was nearly £70,000 in the bank with net cash of £19,000. There are net liabilities and more cash will be required later this year.

Steve Howson is stepping down as chief executive of SG Recruitment Ltd (SGRL) and he will become a non-executive director. Majority shareholder David Sumner will be interim chief executive.

AIM  

Footasylum (FOOT) has recommended a 82.5p a share bid from JD Sports Fashion (SPD) which values the footwear retailer at £90.1m. JD Sports was buying shares between 50p and 75p and built up a 18.7% stake. The bidder promises to maintain the separate commercial identity. Footasylum floated in November 2017 at 164p a share.

Diaceutics (DXRX) ended the week at 97.5p, having floated at 72p. The company provides data analysis and advisory services to pharma companies seeking to develop and commercialise diagnostic tests. There were £15.2m of placing proceeds net of expenses and £5.5m will be spent on the acquisition of data, while the rest will be used to pay off debt and develop AI analysis technology. There is limited liquidity in the shares because they are tightly held.

Wynnstay Group (WYN) warns that trading in the second quarter is weak because of the warmer winter weather. There has also been a weakening in farmgate prices. Interim figures will be well below the first half of last year and the full year will be below forecast. Peel Hunt argues that it has already factored these elements into its forecast for rival feed supplier NWF (NWF) and it is not changing its forecasts.

Pelatro (PTRO) has launched a data monetisation platform with a revenue share contract with an existing client, which is worth $500,000 in the first year. This is a product that can be sold to other customers.

Financial trading platform Aquis Exchange (AQX) reported 2018 revenues ahead of expectations and it doubled its market share during the year. The subscription-based model means that higher trading levels by a trader lead to subscription income levels going up. Aquis will continue to be loss-making this year, but the relatively fixed cost base means that once this is covered the profit should grow significantly as revenues grow.

Scientific instruments supplier Judges Scientific (JDG) increased is cash generation from operations from £10.9m to £15.7m in 2018. There was 5.5% organic growth in revenues and underlying operating profit rose by just over one-third to £14.7m. The cash balance has increased to £15.7m, which provides firepower for acquisitions. Shore Capital has edged up its earnings per share forecast from 188.8p to 190p.

Volvere (VLE) says full year revenues from continuing operations will rise from £16.2m to £18.6m. There was a £23.1m gain on the sale of Impetus Automotive. There was an underlying loss on continuing activities, but the frozen pie maker Shire Foods improved its profit contribution. There is £34.1m of cash in the Volvere balance sheet.

Frontier IP (FIPP) says that the outcome for the year to June 2019 is likely to be ahead of management expectations. A deal by investee company Exscientia, which is involved in AI-based drug discovery, with Celgene Corporation should result in a substantial uplift in its valuation.

Science in Sport (SIS) had a 25-day contribution from the profitable PhD Nutrition business in 2018. The group’s underlying loss increased last year, but PhD will help to reduce the loss and the cash outflow from operations, which was £6.42m last year. There is £8m in the bank and even with capital investment requirements that should be enough to cover requirements this year.

Ceramic products supplier Portmeirion Group (PMP) increased its 2018 pre-tax profit by 10% to £9.7m and a further rise to £10.3m is forecast for this year. Online sales are growing rapidly from a relatively low base. The home fragrance business is doing well, and capacity is being added. The total dividend is 8% higher at 35.7p a share.

Share (SHRE) improved its significantly improved its profitability in the second half of 2018, although trading levels weakened towards the end of the year. That weakness has continued into the early months of this year. Evan so, Cenkos forecasts a rise in pre-tax profit from £700,000 to £1.3m, upgraded from £1.1m, in 2019.

Clear Leisure (CLP) has placed its 50%-owned data mining operation in Serbia on a care and maintenance basis. This is due to the fall in the price of cryptocurrency. Legal actions and negotiations continue concerning a number of past investments. Clear has paid £76,000 for a 10% stake in PBV, which provides data services for the Italian legal sector. At the end of 2018, there were €2.1m of bonds converted into shares.

Andrew Perloff has increased his stake in 600 Group (SIXH) from 6.19% to 8.85%.

Midatech Pharma (MTPH) has changed the ratio of its ADRs from two shares for each ADR to 20 shares for each ADR. This is a way of getting the trading price of the ADRs on NASDAQ back above $1.

EQTEC (EQT) could be a beneficiary of the deal done by its largest shareholder EBIOSS with Urbaser for the collection, treatment and possible conversion of waste to energy. Urbaser is conducting due diligence on EQTEC’s gasification technology and this could be used for any waste to energy plant if all three parties come to an agreement on a specific opportunity. Projects could be in Bulgaria, Greece, Macedonia and Romania.

A local authority report has placed a five year reserve status on the Plymouth Airport site where Sutton Harbour (SUH) has a 135 year lease. The local authorities are keen that the site should be used for general aviation, but a viable business plan needs to be put together. Sutton Harbour would like to develop the site.

Tau Capital (TAU) has sent a circular to shareholders concerning a capital return of $1.19m or 2.42 cents a share, raise $150,000 via a placing at 0.1 cents a share and change its name to UK Onshore. Reverse takeover candidates are being assessed. Gerwyn Williams and Nigel Burton will join the board.

Synectics (SNX) has won a £1m order from the oil and gas sector. This is the largest order for its surveillance systems from this sector for a number of years. Synectics reported a rise in full year revenues from £70.1m to £71.2m and pre-tax profit slipped from £3.02m to £2.86m. The full year dividend is increased from 4p a share to 4.7p a share.

MAIN MARKET 

Athelney Trust (ATY) has responded to the letter from former director Dr Pohl, who wants to regain his place on the board along with Simon Moore and remove David Lawman. Dr Pohl has acquired more than 100,000 shares in the past month, and this means that five shareholders own more than 50% of the investment company putting its investment trust status at risk. As long as there is more than 35% of the company held by the public this is not a problem, but it would be if Dr Pohl joined the board. There have been £90,000 of extra costs because of disputes between the two major shareholders. The plan remains to bring Gresham House on board as fund manager

WideCells Group (WDC) is changing its name to Iconic Labs and moving into digital marketing and technology. The management of this business previously built up social publisher Unilad. In the first 12 months, an agency consulting division will be launched to assists clients to develop brands. There are plans to build up a distribution and publishing division through acquisitions and launch content licensing and e-commerce divisions. There is little indication of what will happen to the stem cell operations, although management appears to believe that the insurance business could be worth pursuing. Historic liabilities are being resolved. The convertible loan note holder continues to convert a proportion of the loan note that is below 30% and then sell the shares. There are 785.6 million shares in issue with more to come.

Bluebird Merchant Ventures (BMV) has raised £436,500 at 2.25p a share. The cash will be used for the pre-construction phase of the South Korean gold projects. An agreement has been made with a local landowner for the use of land outside the main entrance of the Kochang mine.

Highlands Natural Resources (HNR) has raised £1.56m at 8.5p a share via an offer through PrimaryBid.com. This cash will fund a move by the natural resources company into the organic cannabidiol market. It has established Zoetic Organics in the US and it believes that hydrogen produced by Highland in Kansas can be used as a fertiliser with potential to increase the size of the plant. First revenues could be achieved in the summer.

Standard list shell Stranger Holdings (STHP) claims that Alchemy Utilities Ltd has sabotaged the proposed reverse takeover by refusing to provide audited accounts. Stranger is trying to get back the £300,000 it lent to Alchemy as well as its reverse takeover costs of £450,000. Stranger believes that the Alchemy management team may have misrepresented its financial status. An alternative acquisition is being lined up, but Stranger had negative net assets at the end of September 2018 and there are additional costs since then.

Standard list shell Hertsford Capital (HERT) still had £2.88m in cash at the end of 2018.

Telecoms services provider Toople (TOOP) is growing its gross profit but EBITDA is similar to the same period last year, which was around £650,000.

PV Crystalox Solar (PVCS) has ended its wafer production activities in Germany and it intends to apply its wire sawing expertise to cutting non-silicon materials. There are plans to return £38.5m to shareholders, which is equivalent to 24p a share and that is not far short of the current market price. That could still leave more than €10m of cash. Management is considering whether to maintain a listing.

Sure Ventures (SURE) says 23%-owned Suir Valley Ventures has maintained its 10% stake in WarDucks, which is developing an AR game, by participating in a €3.3m fundraising.

Andrew Hore

Andrew Hore – Quoted Micro 14 January 2019

NEX EXCHANGE

Bruce Pubs (PUB) has raised £100,000 from an issue of 7.2% bonds and trading has commenced on NEX. The pubs operator wants to raise up to £20m. The cash will be used to acquire pubs in Scotland. Bruce owns 18 licenced premises with another licence pending. Bruce Pubs is a subsidiary of the holding company Bruce Group, which had net assets of £3.8m at the end of June 2018.

Sativa Investments (SATI) is investigating ways of raising cash to finance the company’s glasshouse and working capital for the first cannabis crop. There are also talks with vets about using medicinal cannabis in animal health. Sativa is pleased with the platform that NEX has given the business. Imperial X (IMPP) is the latest NEX company to change its investing strategy to cannabis investments.

Trading in the shares of Clean Invest Africa (CIA) following news that it has negotiated an agreement to acquire the 97.5% of CoalTech LLC it does not own. The company has technology that can convert waste coal into coal pellets for industrial and commercial use. A circular will be sent to shareholders in the first quarter of 2019.

Primorus Investments (PRIM) has increased its stake in Greatland Gold (GGP) to 35 million shares, which is equivalent to 1.09%. The average cost is 1.71p a share. The investment has been made ahead of further drilling results at the Havieron gold/copper project in Australia.

EPE Special Opportunities (ESO) reported a NAV of 189.95p a share for the end of 2018.

AIM

President Energy (PPC) beat its production target for the end of 2018. The Argentina-focused oil and gas company was producing 3,300 boepd by the year end, which is 10% above the target. The latest drilling programme of three wells has been a 100% success. President intends to build on this base during 2019. The next reserves audit should be published in March. There should be a significant jump in profit in 2019. Panmure Gordon forecasts a 2019 pre-tax profit of $18.6m. The cash generated will help to finance forecast capital investment of around $40m during the year. The target price is 15p a share.

Gateley (GTLY) continues to trade strongly with organic growth supplemented by contributions from acquisitions. The legal services provider increased interim revenues by one-fifth to £46.4m, while pre-tax profit rose from £4.2m to £5m. Net debt increased from £7.1m to £8.2m after acquisitions spending and dividend payments. The second half tends to be more cash generative. More business is coming from litigation work but management is confident that its revenue recognition policies mean that the strong cash generation will not be hit.

Castleton Technology (CTP) is paying £1.8m for Deeplake Digital, which provides digital communications services between landlords and tenants. Thirty of its 90 customers are new to Castleton.

ATTRAQT (ATQT) is expecting to make a small EBITDA figure for 2018. The online shopping performance enhancement services provider will report its 2018 results on 14 February.

More woe for Footasylum (FOOT) as gross margins come under pressure. Revenues were in line with expectations over Christmas but less money was made from them as old stock was discounted. The 2018-19 loss forecast has been edged up to more than £5m.

Higher input costs mean that Accrol Group (ACRL) will not do as well as expected and it will make a significant 2018-19 loss after exceptional charges.

Packaging machinery supplier Mpac Group (MPAC) says 2018 trading was in line with expectations and the year has started with a strong order book. The company is assessing the potential additional cost of pension equalisation for its defined benefit scheme.

Bowleven (BLVN) is paying a 15p a share special dividend on 8 February. This will leave the oil and gas explorer with the cash it requires for its exploration programme.

Wealth manager Mattioli Woods (MTW) says that its interim EBITDA margin was substantially ahead of the 20% target. Gross discretionary assets under management were £2.4bn at the end of November 2018.

Churchill China (CHH) had a strong finish to the financial year with a better second half performance in the UK. The 2018 profit will be higher than expected. The figures will be published on 27 March.

Shoe Zone (SHOE) stands out amongst its peers because it has had strong 2017-18 figures and a good Christmas. Last year’s pre-tax profit improved from £9.5m to £11.3m. Forecasts have been upgraded with 2018-19 earnings per share increased from 16.4p a share to 17.6p a share based on flat profit and a higher tax charge.

Quiz (QUIZ) sales continue to decline, albeit at a slightly lower rate of 5% like-for-like. The fashion retailer had to discount and gross margins were two percentage points lower. Overheads are also too high because of the lack of growth. The full year profit forecast has been cut from £6m to £4.4m.

A North African order for the Helios product supplied by Starcom (STAR) has been delayed until 2019 so 2018 revenues will be lower than expected. The total order value is $1.1m and the majority was expected to be recognised in 2018. Even so, revenues were better than expected, but the loss will be higher.

A general meeting has been requisitioned at Angus Energy (ANGS) by shareholders owning 6.2% of the company. It is believed that former chairman Jonathan Tidswell-Pretorius is behind this requisition, which involves the proposed removal of Paul Vonk from the board and the appointment of the Earl of Lucan and George Bingham. Non-exec Rob Shepherd has resigned. Angus has entered into a 24 month, £3m loan facility with YA II PN Ltd and Riverfort Global Capital in order to finance the development of the Balcombe field in the Weald basin. A £1.5m drawdown is planned immediately.

Rose Petroleum (ROSE) has acquired additional acreage in the Paradox Basin in Utah at a cost of $35,000. Rose believes that the new acreage could have an NPV10 of around $12m. The deal follows the results of the Schlumberger study which suggests that the site of a proposed well in the area should be in an optimal position.

Diurnal Group (DNL) has been granted a second patent for hydrocortisone treatment Chronocourt, which already has orphan drug designation. The patent lasts until 2033.

A £2m subscription and $5m investment into an internal finance note by 1795 Volantis Fund will provide Obtala Ltd (OBT) with additional funds. 1795 Volantis Fund will own 12.9% of Obtala, as well as 40 million warrants exercisable at 10p each. The disposal of a Tanzanian agricultural business will bring in a further $2.5m. Obtala intends to acquire the 25% it does not own in Montara Continental for $5m, which will be reinvested in the internal finance note.

Fuel cell developer Proton Power Systems (PPS) will own 33.33% of Hamburg-based Clean Logistics, which is being set up to build heavy trucks powered by fuel cell hybrid systems in the range of 75kw-150kw. The other two equal shareholders are Hopen, which has interests in battery and electric vehicle developers, and modular transport service provider Hary.

Sopheon (SPE) had a strong end to 2018. The software provider will provide more details in its trading statement later this month, when finnCap says it will reassess its forecasts.

Dekeloil (DKL) says that fourth quarter volumes were in line with expectations with a 2% increase in crude palm oil production on the third quarter. The annual production was 15% lower because of the weak first half. Selling prices have been at a premium to the market price. The purchase of a 43.8% stake in the Tiebissou cashew processing project has been completed.

Imaginatik (IMTK) has decided to sell its software business and assets to Planbox. The initial cash payment is $1.7m and up to $800,000 more could become payable. If it is all paid then the selling price would be higher than the book value of the assets. Imaginatik will become a shell with around £1m in cash left from the initial payment. If the disposal is approved by sharehodlers the company will change its name to Abal Group.

Telematics firm Quartix (QTX) continues to grow fleet sales but lower insurance sales are partly offsetting that growth. A supplementary dividend will be announced with the final dividend when the 2018 figures are published on 25 February.

Brighton Pier Group (PIER) says problems with the railways are hampering the income generation of Brighton Pier and earning shave been lower. The trading of the bars division was flat last year. Pre-tax profit will be around £3.2m, which is 18% lower than previous expectations.

Frontier IP (FIPP) says that its investee company Exscientia has raised $26m and is collaborating with Roche in a deal worth up to CHF67m. Frontier IP owns 3.32% of artificial intelligence-driven drug developer Exscientia.

MAIN MARKET

InnovaDerma (IDP) has revealed a 6% dip in first half revenues to £3.9m, even though retail sales grew strongly. Direct sales fell, although there are indications that they are recovering. The cosmetic products supplier will have to do well in the second half to achieve full year forecast revenues of £14.4m.

Trident Resources (TRR) has £1.85m in the bank at the end of October. The shell raised £4m when it floated in October. The balance sheet includes trade receivables of £2.1m, although management says that it started the year with just under £4m in cash. Potential acquisitions are being assessed.

Andrew Hore

Andrew Hore – Quoted Micro 24 December 2018

NEX EXCHANGE        

China-based Gamfook Jewellery had planned to join the standard list, but it has decided to float on NEX. The online retailer of customised jewellery had intended to raise cash at 15p a share, but the flotation on NEX on Christmas Eve will be an introduction at 15p a share. Management hopes the flotation will help to increase its profile and customer base. A dividend based on 28% of profit attributable to shareholders is promised.

Walls and Futures REIT (WAFR) has maintained its NAV at 92p a share at the end of September 2018. In the six months to September 2018, rents increased from £33,000 to £67,000. Additional supported housing opportunities have been assessed.

KR1 (KR1) has raised £785,000 at 5p a share and paid £40,000 in fees to advisers in shares at the same price. KR1 director Keld van Schreven subscribed for 50,000 shares. The cash will fund further blockchain token investments.

Panther Metals (PALM) has signed heads of terms for the acquisition of Parthian Resources, which owns exploration assets in Australian. Parthian shareholders will own 15% of Panther if the deal goes ahead. One of these shareholders is Kerim Sener, who is non-executive chairman, who will end up with 4% of Panther. The deal should be completed in January 2019.

Blockchain investment company Coinsilium Group Ltd (COIN) says that Gibraltar-based StartupToken has attracted a £193,000 investment from South Korea-based Blockwater Capital in return for a 7.4%. Coinsilium had invested £360,000 in StartupToken during November and the value of the investment has doubled to £722,000. Executive chairman Malcolm Palle has bought 200,000 shares in Coinsilium at 3.6p a share, taking his stake to 6.35%.

Clean Invest Africa (CIA) is acquiring the remaining 97.5% of CoalTech LLC for £24.6m. This will be funded by a share issue. A circular will be published in the first quarter of 2019. A new incentive plan for management, in the form of options exercisable at 2.5p a share, is planned.

IMC Exploration (IMCP) has issued five million shares at 1p ia share and every five shares has a warrant exercisable at 1p a share. The £50,000 will be used to continue exploration in Avoca, County Wicklow. Wishbone Gold (WSBN) has raised £300,000 at 0.1p a share. The cash raised will be used to accelerate production at the Honduras gold facility. NQ Minerals (NQMI) has raised £38,000 at 12p a share.

Milamber Ventures (MLVP) has issued shares valued at nearly £302,000 to creditors at a range of share prices. Management has acquired the majority stake in Milamber USA and Milamber retains a 20% stake. Milamber has also reduced its stake in Vocademia to 5% with the rest of the share capital acquired through the return of 900,000 Milamber shares. A further 166,667 shares were returned for Milamber’s stake in White Cobalt. Milamber has created a new training compliance company called Checkbox and taken a 51% stake in an education joint venture with Black Arrow Space Technologies, which is developing commercial orbital launch services.

Imperial Mining (IMPP) is changing its name to Imperial X to reflect the change in investment focus from resources to the cannabis sector.

Medicinal cannabis investment company Sativa Investments (SATI) says that investee company Rapid Dose Therapeutics Inc has listed on the Canadian Stock Exchange. This has provided a 70% uplift in the initial investment value for a gain of C$140,000.

Lombard Capital (LCAP) had £4,130 in cash and £112,000 in assets available for sale. at the end of September 2018. Lombard still plans to issue an asset-backed investment bond.

Tectonic Gold (TAU) says that initial analysis of drilling at the Specimen Hill project in Queensland has confirmed mineralisation with grades up to 6.06g/t. Full results should be available in January.

Trafalgar Property Group (TRAF) is raising up to £1m through an issue of 8.5% convertible bonds 2025. The issue could eventually be increased to £5m. The bonds will be traded on NEX. The cash will be used to fund residential development and planning applications. Trafalgar has limited cash and it lost money last year.

AIM   

Filta Group (FLTA) has multipled the size of its grease management operations in the UK through the acquisition of Watbio for £6.9m in cash and shares, plus working capital adjustment. Cenkos has provisionally upgraded its 2019 earnings forecast by 26% to 11.8p, assuming completion of the deal in early January. Filta is raising £3m at 200p a share, which is a premium to the market price, and has obtained a £4m, five-year loan facility. Filta started building a grease management division through acquisition just over one year ago. Watbio generates annual revenues of £10.3m and pre-tax profit of £800,000 so it is much larger than the existing operations. It also offers other drain management services.

A strong performance from property servies more than made up for a weak first half performance of the business recovery division of Begbies Traynor (BEG) and pre-tax profit was 9% higher at £3.2m on revenues 8% ahead at £28m. The number of insolvencies increased in the first half but there was no repeat of the large one-off fee in the first half of the previous year. The interim dividend was raised by 14% to 0.8p a share. Net debt fell 10% to £6.3m. The performances of the divisions will reverse in the second half and 2018-19 pre-tax profit should improve from £5.6m to £6.4m.

President Energy (PPC) has drilled the third Puesto Flores well on budget and there have been good oil shows, but they are lower than the previous two wells. All three wells could be in production by the end of the year.

AssetCo (ASTO) has transferred the loal employees in Abu Dhabi to the new supplier of fire services. There is a possibility of winning work in the region. The litigation against former auditor Grant Thornton continues and a judgement could happen in the first couple of months of 2019.

URA Holdings (URA) was not able to complete the acquisition of Entertainment AI early enough to prevent the cancelation of the AIM quotation on 24 December. The acquisition could still happen.

Real Good Food (RGD) has sold jams maker R and W Scott for £1.5m, of which £500,000 is deferred until September 2019, and the assumption of £2.45m of debt. That takes disposal proceeds to £17.8m and completes the main corporate activity. The cake decoration and food ingredients businesses make up the majority of the remaining group.

Small business financial services provider City of London Group (CIN) continues to lose money as it builds up its activities. Recognise continues to try to obtain a UK banking licence.

HaloSource Corporation (HALO) has not been able to secure additional finance and trading in the shares has been suspended. There is limited cash left.

Thalassa Holdings (THAL) intends to move to a standard listing. No new shares will be issued and the move should take place on 25 January.

Revenue and EBITDA growth in the range of 15% to 20% is expected by Craneware (CRW) in the six months to December 2018. The healthcare accounting software provider has a 100% renewal rate in dollar terms in the first half.

Replacement windows and doors manufacturer Safestyle (SFE) has improved its order intake in the past six months after its agreement with a former employee who was competing with the company. However, costs have increased and the 2018 loss will be between £8.2m and £8.6m. The 2019 performance could be ahead of expectations. Otus Capital Mananagement has taken a 5.42% stake.

Audio equipment supplier Focusrite (TUNE) had a strong November but it is still cautious about the full year. The trade dispute between the US and China remains a concern.

N4 Pharma (N4P) has extended the licence agreement with UniQuest for Nuvec. It has become an exclusive global licence with certain fields licensed back to UniQuest.

finnCap has resigned as nominated adviser and broker to The People’s Operator (TPOP) and that could scupper the placing with the owner of LycaMobile. An investment of £1.3m in shares (29.9%) and convertible loan notes was planned.

Yu Group (YU.) says that the Financial Conduct Authority is investigating the accuracy of its announcements between March and October. Poor internal controls caused a shortfall in profitability. The energy supplier has revealed that its 2018 loss could be as high as £7.85m, which is higher than previously estimated. This is due to a decline in gross margins and balance sheet corrections. There was £11m in the bank at the end of November 2018.

LiDCO Group (LID) will report float full year revenues and this has led to a £800,000 increase in forecast pre-tax loss to £1.9m. The take-up of the high usage programme has been slower than expected and an Asian order was delayed. The patient monitoring equipment supplier is expected to have cash of £1.5m by the end of January 2019.

TLA Worldwide (TLA) has agreed in principle to sell its Australian business to QMS Media and this would make TLA a cash shell.

Rasmala (RMA) left AIM on 19 December. A new holding company is based in the British Virgin Islands.

It gets worse at Paragon Entertainment (PEL) with another loss in the second half on lower than expected revenues. A 2018 loss of £2.4m is forecast. Overheads have been reduced so the loss could be smaller next year.

Scientific Digital Imaging (SDI) increased interim revenues by 23% to £8.05m through a combination of acquisitions and organic growth, while pre-tax profit was one-third higher at £1.5m. finnCap is cautious about the full year for the scientific instruments supplier and has maintained its full year pre-tax profit forecast at £2.6m, which suggests a lower second half profit.

Management has launched a 12p a share bid for former AIM-quoted PR firm Freshwater as a way of enabling existing shareholders to exit the business.

MAIN MARKET  

Trading in standard list shell Fandango Holdings (FHP) shares has been suspended ahead of the proposed reverse acquisition of Konnect Mobile Communications Inc, which owns PaySocial Inc, a mobile banking and payments eWallet.

Standard list shell Papilon Holdings (PPHP) has acquired 50% of Pace Cloud Ltd, which owns CarCloud, a fintech company involved in the used car sector. This represents a fundamental change in the business. Papilon is raising up to £500,000 via a convertible loan note issue. The conversion price is 1.25p a share.

Telecoms services provider Toople (TOOP) lost £1.4m in the year to September 2018, which was slightly more than the previous year. The gross profit of £203,624 was enough to cover the directors pay of £196,713. There was a cash outflow of nearly £1m in the period. There was £2.14m in the bank at the end of September 2018, but there is a loan from former shareholder David Breith with a cash value of nearly £607,000, which could become repayable from 3 May 2019.

Zegona Communications (ZEG) has decided not to tender €7.75 a share for up to 14.9% of Euskaltel, where it is trying to improve performance, because it has not been abe to secure funding. Zegona has secured a relationship with Talomon Capital, which will own up to 2.4% of Euskaltel on top of Zegona’s existing 15% stake, which will be increased via market purchases. That requires a share issue by Zegona.

Investment company Athelney Trust (ATY) is consulting with existing and potential shareholders, concerning a tender offer to existing shareholders at the same time as an issue of new shares.

Andrew Hore

Andrew Hore – Quoted Micro 3 December 2018

NEX EXCHANGE        

European Lithium (EUR) joined NEX on 26 November. European Lithium is the 100% owner of the Woflsberg lithium project in Austria and it is already quoted on the ASX. The plan is to produce battery grade lithium hydroxide for the European market. Capex of $390m is required for the project. WH Ireland estimates the NPV at $223m.

Crossword Cybersecurity (CCS) has confirmed its move to AIM in the middle of December. The cyber security systems developer plans to raise up to £2.25m.

Wheelsure Holdings (WHLP) raised £125,000 at 1p a share. This will finance product development. Wheelsure has established a project with Haydale Graphene Industries (HAYD) and the University of Manchester. This will develop a product combining graphene with Wheelsure’s failsafe locking system.

Ace Liberty and Stone (ALSP) has completed the acquisition of the Mecca bingo hall in Chesterfield for £4m. The property has a ten year lease and generates annual rent of £388,000. Ace has issued 147,070 shares at 100p each covering the conversion of convertible loan notes and payment of related interest.

Sandal (SAND) says that it needs more to cash in order to fully exploit the potential for Energenie MiHome products. Revenues in the first five months of the new financial year are higher than in the same period last year, even though there was a stock overhang at one Energenie MiHome customer.

IMC Exploration (IMCP) is relinquishing two licences in order to focus on its three main projects. They are the tailings project in Avoca, Wicklow, the north Wexford gold project and the zinc project in County Clare. There was €212,000 in the bank at the end of June 2018.

TechFinancials Inc (TECH) has launched the Beta version of its CEDEX blockchain diamond exchange.

Barkby Group (BARK) has taken on a ten-year lease for The George at Burpham in Sussex.

Primorus Investments (PRIM) has purchased 27 million shares in Greatland Gold (GGP) at an average price of 1.67p a share. The investment totalled £450,000. This is on the back of positive drilling results. At the Havieron gold/copper project in Western Australia.

Dana Group International Investments (DANA) reduced its underlying loss in the year to June 2018 and it ended the period with a NAV of 21 cents a share. There was a sharp decrease in NAV due to the write-down in the value of investments.

Imperial Minerals (IMPP) is still seeking a resources acquisition. There was £20,000 in the bank at the end of June 2018 and subsequently a further £50,000 was raised by a convertible issue.

AIM   

Active Energy Group (AEG) has raised nearly £1.5m at 1p a share and there is one warrant with every four new shares. The warrant is exercisable at 1.75p a share over a 12 month period. Creditors have been issued 15.5 million shares for the money they are owed. The cash will be used to finance the plans for a CoalSwitch plant with its joint venture partner and the working capital for the newly awarded cutting permits in Newfoundland.

Financial services provider STM Group (STM) expects a significant release from the London and Colonial Assurance of at least £500,000 before the year end. Last year, the release was £1.3m. There have also been one-off costs, but overall pre-tax profit should be in line with expectations.

Kropz (KRPZ) began trading on AIM on Friday. The share price ended the day at a 3.5p premium to the 40p placing price. The plant nutrient producer raised £27.3m to finance the Elandsfontein phosphate project.

Inland Homes (INL) has a land bank of 7,000 plots and 1,700 of them have planning consent with a further 2,000 in the planning pipeline. The sale of 386 plots in Buckinghamshire has generated a management fee of more than £7m. There should be 80 houses completed in the first half. The Rosewood Housing business has obtained approval to become a provider of affordable housing.

Argentina-focused oil and gas producer and explorer President Energy (PPC) has completed the acquisition of additional assets. Incremental production will start in December. Drilling of the third well at the Puesto Flores field has started.

Gift wrap supplier IG Design Group (IGR) has grown in the first half via a combination of acquisition and organic growth. The interim figures have led Progressive Equity Research to raise its 2018-19 earnings forecast from 25.9p a share to 27p a share.

Babestation broadcaster Cellcast (CLTV) says that revenues are declining and this is likely to continue. There is £700,000 in the bank and management is trying to collect money owed in Kenya.

IDOX (IDOX) says that full year revenues, excluding the former digital division, fell from £73.5m to £67.2m. The information management software provider generated adjusted EBITDA of £14.4m, down from £16.7m. Annualised recurring revenues are running at £32.4m. The annual results will be published in February.

Safestay (SSTY) is raising up to £11m via a placing and one-for-12 open offer at 34p a share. This cash will finance the conversion and refinancing of two hostels as well as investment in other existing sites and acquiring new ones.

Faroe Petroleum (FPM) has rebuffed a bid approach by DNO. Faroe says that the 152p a share cash offer, which values the oil and gas company at £607.9m, undervalues the business and its prospects. DNO already owns a 28.2% stake in Faroe.

Rose Petroleum (ROSE) has been paid around $300,000 in shares for providing its uranium database to enCore Energy Corp. The shares have to be retained for four months.

Timber merchant James Latham (LTHM) reported a 10% increase in interim revenues, while underlying pre-tax profit was £7.6m, prior to a £1.1m gain on the sale of the Yate site. The order book is strong, but it is more difficult to pass on price rises. There is £12.9m in the bank.

Maistro (MAIS) has launched a one-for-7.28423264 open offer at 1p a share. That could raise up to £250,000, which could take the total raised to £2.2m.

TLA Worldwide (TLA) is planning to sell its US operations to major shareholder Gatemore and may also sell its Australian activities. This may raise enough to pay off debt and leave a small amount of cash in TLA.

Gaming demand continues to be strong for security technology provider Synectics (SNX) but UK bus demand means that the full year profit forecast has been cut from £3m to £2.8m. The £4m profit forecast for the following year has been maintained.

The optimism about the Wressle oil project proved false and the planning permission was not approved as had been recommended. The original application was refused two years ago and an appeal is planned. Operator Egdon Resources (EDR) owns a 30% interest in Wressle, Europa Oil and Gas (EOG) has a 30% interest and Union Jack Oil (UJO) has a 27.5% interest. Humber Oil and Gas owns the other 12.5%.

Altona Energy (ANR) has temporarily suspended its activities at the Westfield Tenement in Australia. Management believes that other coal deposits may be more suitable for its pyrolysis technology.

Realm Therapeutics (RLM) has selected a shortlist of potential transactions, including a potential sale of the company. Further news will be published in the first quarter of 2019.

Fishing Republic (FISH) is still trying to raise additional funds for the business and it is also assessing options for selling the business.

Webis (WEB) improved its pre-tax profit from $5,000 to $103,000 in the 12 months to May 2018 and this is before any benefit from legalised online sports betting in the US.

MAIN MARKET  

Bioquell (BQE) is recommending a 590p a share cash bid from US-based Ecolab. That values the bio-decontamination business at £140.5m. The bid is nearly four times the level of the share price three years ago.

Standard list shell Hertsford Capital (HERT) has raised £3mat 10p a share. The technology-focused investment company has £2.8m in cash after costs. The share price ended the week at 11.75p.

Interim revenues declined from £666,000 to £498,000 at Associated British Engineering (ASBE) although the loss fell from £377,000 to £342,000 due to an improved performance at British Polar Engines as annual cost savings of £150,000 start to show through. There is around £1m of cash and available for sale financial assets, which is similar to the NAV.

PV Crystalox Solar (PVCS) has received the final payment of €14.3m in settlement of claims against a customer.

Flavour and fragrance ingredients supplier Treatt (TET) increased its revenues by 11% to £112.2m in the year to September 2018. Pre-tax profit improved from £11.7m to £12.6m. US capital investment should be completed next year.

Vertically integrated gemstone explorer Shefa Yamim (SEFA) is set to begin trial mining early next year. The latest exploration results have increased the volumes of mineralised placer gravels at three target sites from 1.1 million tonnes to five million tonnes.

Cardiff Property (CDFF) increased its net assets from 2126p a share to 2178p a share at the end of September 2018. The property investor has no debt and there is cash and financial assets of £5.8m. The dividend has been increased from 15.5p a share to 16.6p a share.

Andrew Hore

Andrew Hore – Quoted Micro 8 October 2018

NEX EXCHANGE        

National Milk Records (NMR) is recommending a dividend of 2.5p a share after it moved from an operating loss of £11.9m to an operating profit of £1.9m in the 12 months to June 2018. If one-offs are stripped out, then the operating profit has improved from £1.1m to £1.9m. Net debt is £1.8m. There has been an improvement in the dairy market over the past year. Demand is increasing for services related to animal welfare and health, as well as for reproduction services.

Coinsilium Group Ltd (COIN) has signed a strategic partnership with Lition Technology, which is developing a new blockchain infrastructure. This will be the first blockchain with deletable data features. A Lition token sale has commenced and the funding target is $25m.

EQE Special Opportunities (ESO) has sold its investment in Process Components for £13.6m and this has added 11.16p a share to EPE’s NAV, which is 216.31p a share.

KR1 (KR1) has sold its remaining Golem tokens for nearly $134,000. They were bought for 1.3 cents each and sold for 22 cents each in less than two years. The remaining Qtum tokens have been sold for $125,000, which is equivalent to more than twenty times the price per token they were acquired for.

Botswana-focused oil and gas company Karoo Energy (KEP) is confident that it will be able to raise the cash it requires before the end of the year. Contax Partners is keen to be involved in a fundraising. There are also plans to move to AIM and gain a listing on the Botswana Stock Exchange.

Via Developments (VIA1) has completed the construction of the Napier House development in Luton and 23 of the 30 apartments have been sold. Cash of £702,000 has been received with a further £3.64m to be paid on completion. The other seven apartments are valued at £1.5m.

Anthony Carr, a new investor, has acquired 1.785 million shares in healthcare IT supplier DXS International (DXSP) at 7p each. That is a 5.07% stake. Director Bob Sutcliffe has acquired 12,960 shares at 7.88p each, which takes his shareholding to 0.96%.

IMC Exploration (IMCP) has raised £120,000 at 1.2p a share and the cash will be used to finance the companies three main projects in Ireland.  New IMC chairman Eamonn O’Brien subscribed for 4.34 million shares taking his stake to 2.5%. NQ Minerals (NQMI) has raised £250,000 at 12.5p a share, while convertible loan notes worth £81,000 were converted into shares at 8p each. Imperial Minerals (IMPP) is raising up to £300,000 from an issue of unsecured convertible notes with an annual interest rate of 10%.

AIM   

Gooch and Housego (GHH) says trading for the year to September 2018 was in line with guidance. The optical equipment supplier improved its undersea cable equipment revenues in the second half and the industrial sector demand was strong. Acquisitions in aerospace and life sciences will help to offset any cyclicality in the industrial sector. The order book is worth £96.1m.

Avingtrans (AVG) reported slightly better than expected figures. The engineering company has started to reap the benefits of the Hayward Tyler acquisition but there is more to come. Revenues were 247% higher at £78.9m with the acquisition helping gross margin to improve to 25.5%. The underlying pre-tax profit was £2.4m and the total dividend 3.6p a share. A £4.3m profit is forecast for this year, rising to £5.3m in 2019-20.

Telecoms sector marketing services provider Pelatro (PTRO) will offer its loyalty management solution to Telenor’s global operations. The Danateq acquisition has helped Pelatro have the chance to win this work.

Event driven marketing services provider mporium (MPM) has deployed its IMPACT sports syncing technology with two large global advertising networks. This provides access to even more brands and will help to build revenues in order to reduce the loss.

DX (Group) (DX.) reported a reduced loss in the second half but the parcel delivery firm still made a large full year loss. A £4.5m profit is forecast for next year.

Myanmar-focused social media platform operator MySQUAR Ltd (MYSQ) generated revenues of $1.84m in the year to June 2018, with gaming revenues more than offsetting a decline in advisory income. However, second half revenues were barely higher than the first half revenues. Current monthly games revenues are flat. There is $2m in the bank.

MAIN MARKET   

Standard list cash shell Trident Resources (TRR) started trading on 1 October after £4m had been raised at 20p a share. Trident is seeking to acquire in the mining sector.  Ongoing costs are expected to be £130,000 a year with additional costs for due diligence on potential acquisitions.

Avocet Mining (AVM) says that it has enough cash for the next 12 months, as long as Elliott, which is the company’s largest shareholder, does not ask for its loans of $29.9m to be repaid. Avocet’s only asset is in the Tri-K development.

Flavour and fragrance ingredients supplier Treatt (TET) has done well enough in the second half to offset negative currency movements, so pre-tax profit for the year to September 2018 is in line with expectations. Like-for-like revenues grew by 9%. US manufacturing capacity expansion is on time and the relocation of the UK site is progressing well. The full year figures will be published on 27 November.

Andrew Hore

Andrew Hore – Quoted Micro 23 July 2018

NEX EXCHANGE        

Netalogue Technologies (NTLP) moved back into profit in the year to March 2018 and it is paying a dividend of 0.4p a share. The e-commerce technology company edged up revenues from £1.04m to £1.07m, while a loss of £46,000 was turned into a profit of £82,000, even after amortisation of £70,000, up from £20,000 in the previous year.  Net assets of £770,000 include £502,000 of cash.  There are a growing number of opportunities for this financial year.

Sativa Investments (SATI) has signed an IP sharing agreement with Canada-based Veritas Pharma. This could help with Sativa’s plans to grow medicinal cannabis and also help to choose a particular strain.

Equatorial Mining and Exploration (EM.P) has completed its investment agreement with ARQ Minerals and this formalises the commitment to work together in Nigeria. The St Leonard’s mine is supplying trial amounts of coal. ARQ helps to manage the mine and it is subscribing £50,000 each for two tranches of shares in the operating company, which will take is stake to 50%. ARQ will also own 1,000 million warrants exercisable at 0.02p a share. ARQ has committed to producing a minimum of 40,000 tonnes of coal and every 1,000 tonnes produced above this level will earn an additional 0.625% stake in the operating company, which can take the stake up to a maximum level of 75%. ARQ and Equatorial will be paid 10% of gross profit each month with the rest of the profit shared in line with their equity interests.

Welney (WENP) has announced a general meeting to vote on the appointment of Mark Jackson and Mark Chapman as directors.

Secured Property Developments (SPD) still had £627,000 in the bank at the end of June 2018 because it has not been able to find an investment at a realistic price.

Blockchain investment company Coinsilium Group (COIN) says that Malcolm Burne has been appointed as project adviser to the company’s blockchain platform development company TerraStream.

New director Melissa Sturgess has bought 9.23 million shares in Imperial Minerals (IMPP) at 1p each. That is a 29% stake.

Medicinal cannabis sector investment company High Growth Capital Ltd (HASH) had £522,000 in the bank at the end of March 2018 and it has raised £250,000 at 0.4p a share.

AIM  

Parity (PTY) is still on track to achieve double digit profit growth this year. The IT recruitment and consultancy services provider remains modestly rated even though the share price has risen substantially this year.

Yu Group (YU.) says interim revenues increased by 69% to £35m. The energy supplier expects full year revenues to be at least £82m, which means that operating profit should rise by three-quarters. There is £18.2m in the bank.

Frontier IP Group (FIPP) says that portfolio company Tarsis Technology has entered into a collaboration with a major crop protection products company. The company will provide the funds to further develop the Tarsis technology to deliver chemical pesticides and fungicides in a more controlled way. In return the company gets exclusive rights to particular agrochemicals usage and Tarsis would get royalties from commercial products. Frontier IP is lending Tarsis £150,000 in return for share options.

Consumer healthcare business Venture Life Group (VLG) is raising £18.75m at 40p a share to help finance the acquisition of Dentyl Dual action mouthwash and BB Mints for £4.2m and repay £3.7m of convertible loan notes. The remaining cash will be used for further acquisitions. The share issue more than doubles the number of shares in issue.

Odey has withdrawn its general meeting requisition at Tungsten Corporation (TUNG) following the appointment of Anthony Bromovsky and Duncan Goldie-Morrison to the board.

600 Group (SIXH) has offloaded its pension scheme to specialist insurer Pension Insurance Corporation. The scheme will be wound up and surplus funds after tax will be returned to the machine tools supplier. That could be up to £4m. Full year revenues grew from $58.8m to $66m, while underlying pre-tax profit improved from $2.65m to $3.05m. That excludes the gain on the sale of ProPhotonix (PPTX) shares.

Integumen (SKIN) is raising £700,000 at 0.65p a share and renegotiated the deal with food supplements supplier Cellulac so that it will acquire a 9.35% stake. Cellulac’s chief executive and chief operations officer will join Integumen in those roles. Cellulac will grant Integumen a licence to sell its products in certain territories.

A positive trading statement from audio visual equipment distributor Midwich Group (MIDW) has led to a forecast upgrade. Earnings per share forecasts have been raised by 3% for each of the next three years. The 2018 profit is expected to be £28.3m and earnings per share 27.6p. The interims will be published on 11 September.

EKF Diagnostics (EKF) has signed a manufacturing agreement with Oragenics Inc. EKF will supply drug substances for the customer and this will boost next year’s profit by 5%.

LiDCO (LID) has signed a distribution deal with a Chinese supplier of blood monitoring cuffs and this will help to replace the lost income from the Argon distribution contract. It may take time to build up sales, though.

Woodford Investment has increased its stake in superyacht painting and maintenance services provider GYG (GYG) to 21.5%. This comes at a time that Old Mutual has been selling down its stake after the recent profit warning.

Corporation tax software supplier Tax Systems (TAX) has grown its recurring and non-recurring revenues in the first half of 2018 and total revenues were 14% higher, which includes 9% organic growth. Net debt is down to £17.5m.

Synectics (SNX) had net cash of £9.1m at the end of May 2018. The surveillance technology company increased interim revenues by 3% to £34.7m thanks to strong demand from the gaming sector. Underlying profit improved from £1.3m to £1.5m. Stockdale has maintained its full year profit forecast at £3.1m.

EMIS (EMIS) says that its primary care business is sorting out its problems and the net cash grew to £32.3m at the end of June 2018. The health IT technology supplier says that the business has grown in the first half and still expects an improvement in full year profit. The share price has recovered since the disappointing trading statement earlier this year.

Ken Kroeger has become permanent chief executive of driver monitoring systems technology developer Seeing Machines (SEE) and he will had over the chairmanship to Jack Boyer at the beginning of 2019.

MAIN MARKET    

Investment company Athelney Trust (ATY) says that its NAV dipped to 264.2p a share at the end of June 2018, although this was partly due to the payment of the final dividend of 8.9p a share. Excluding that, there was a 4% decline. There was an improvement on the net return on ordinary activities from £110,000 to £125,000, but the loss in the capital part of the income statement was slightly higher than that revenue gain. The total value of investments was £5.61m and NAV was £5.7m. During the first half, shareholdings in Countrywide, Debenhams, DX, Juridica Investments, HC Slingsby and Sprue Aegis were sold.

Avation (AVAP) has acquired a second new Airbus A220-300 aircraft and leased it to airBaltic.

Flying Brands Ltd (FBDU) is raising £500,000 at 2.5p a share in order to help finance obtaining FDA clearance for StoneChecker software and design a cloud-based interface, as well as boost commercial operations. Subsidiary Imaging Biometrics is involved with a phase II trial that will use its IB Rad Tech technology to process data from 20 sites to determine how well dynamic susceptibility contrast magnetic resonance imaging in measuring the effectiveness of brain tumour treatment.

Andrew Hore

Andrew Hore – Quoted Micro 16 July 2018

NEX EXCHANGE        

Hotel operator Hydro Hotel, Eastbourne (HYDP) reported flat interim revenues of £1.51m in the six months to April 2018, during a period where building repairs were undertaken. Higher overheads and maintenance costs meant that the loss increased from £153,000 to £200,000. There is £635,000 in the bank.

AfriAg Global (AFRI) has raised £300,000 at 0.1p a share in order to finance its new investing strategy of investing in medicinal cannabis businesses.

Panther Metals (PALM) has signed an option agreement to acquire gold exploration properties in Ontario. The total potential consideration is C$133,000 (£77,000) in cash and the issue of 19.15 million shares at 0.3p each, locked-in for six weeks. A non-refundable payment of C$30,000, one-half cash and one-half shares, has been paid. Due diligence needs to be completed within eight weeks.

NQ Minerals (NQMI) has entered into two marketing and off-take agreements, combined with a $10m secured prepayment facility with Traxys Europe. The off-take agreements relate to all lead and zinc concentrates from the Hellyer project in Tasmania in the first five years of production.

Pelican House Mining (PHM) had nearly £49,000 in the bank at the end of June 2018. The former Hellenic Capital acquired a 15% stake in Might Oak Explorations last month.

Melissa Sturgess and Michael Langoulant have been appointed as directors of Imperial Minerals (IMPP) and James Hamilton and Russell Hardwick have resigned.

Wheelsure Holdings (WHLP) has received approval for the Tracksure locking device from the Italian State Railway.

Clean Invest Africa (CIA) plans to buy out the other shareholders in CoalTech LLC. Due diligence has commenced prior to making an offer for the 97.5% of CoalTech not owned by the clean technology investment company. The initial investment was $500,000.

AIM     

Frontier IP (FIPP) investee company Pulsiv Solar has won a UK government grant worth £130,00, which will be put towards a £289,000 project to compete the development of its solar micro-inverter by next April. Frontier IP owns 18.9% of the University of Plymouth spin-out.

Kestrel Partners continues to build up its stake in broadcast software provider Pebble Beach Systems (PEB) and it has taken it from 16.6% to 17.4%. Continuing operations moved back into operating profit in 2017, even though revenues fell from £10.9m to £10.3, but the £500,000 was not enough to cover interest charges and rationalisation costs. Net debt was still £10.3m after getting some proceeds from the sale of the Vislink hardware business. The revolving credit facility is £15m.

Medical imaging technology developer Polarean Imaging (POLX) has raised £800,000 at 16p a share, following last month’s investor symposium. This provides additional cash to support phase III clinical trials in the US and invest in further development.

Veltyco (VLTY) has decided not to go ahead with the potential acquisition of sportsbook operator Ruleo Alpenland.

Telit Communications (TCM) has agreed to sell its automotive division to TUS International for $105m and the deal should be completed by the end of 2018. In 2017, this business made a $10.1m contribution to EBITDA before group overheads. This deal will more than wipe out the current net debt of $25m. The focus will be the Internet of Things operations.

Online women’s fashion retailer Sosandar (SOS) continues to build up its sales. The reported interim revenues were £1.35m. Like-for-like interim revenues grew by 268%. The company remains loss-making but the gross margin improved from 37.8% to 49.4%. There was £4.6m in the bank at the end of March 2018 and this will help to finance further increase in the product range as well as continued losses. There is a database of more than 54,000 customers and 11,407 of those were repeat customers in the period.

Duke Royalty Ltd (DUKE) is raising £44m at 44p a share to fund the pipeline of royalty financing opportunities. There are already four new potential royalty partners requiring £27.5m. These include healthcare, foods and media businesses. Within 12 months, Duke expects to increase its dividend yield. Last December Duke raised £20m at 40p a share.

Itaconix (ITX) is raising £3.4m at 2p a share, which was a 70% discount to the suspension price. Trading in the shares will start again on Monday 16 July. The speciality polymers designer will have enough cash for 12 months, assuming shareholders vote in favour of the share issue. Revenues have been building up slowly and last year they nearly doubled to £553,000. The loss was £11.9m.

One year after it joined AIM, superyacht painting and maintenance services provider GYG (GYG) says that first half trading was weaker than expected. There were delays in refits and fewer new build projects were won. First half revenues of around €25.1m are lower than the two previous first half outcomes. It appears that the interim loss will be more than €1m. There are €12.1m of orders expected to be completed in the second half with a further €25m of “high probability prospects”. The 2017 revenues were €62.6m.

Marlowe (MRL) is raising £20m at 475p a share in order to finance further acquisitions in the critical asset management services sector.

Tristel (TSTL) says that its full year pre-tax profit should be at least in line with the £4.4m forecast, up 8%. Higher investment in gaining US approvals for disinfection products has held back profit growth, but it is expected to accelerate in 2018-19 when a pre-tax profit of £5.2m is forecast.

ReNeuron (RENE) has signed a three-month exclusivity agreement with a major pharma company to potentially out-licence the global rights, excluding China, of its hRPC retinal stem cell technology platform. A non-refundable payment of $2.5m will be received with a further $2.5m due if the deal goes ahead. There was £34.7m in the bank at the end of March 2018 and this should last well into 2020 even though there will be significant spending on trials, including the phase III trial of the CTX cell treatment for stroke disability.

Xpediator (XPD) has acquired Import Services Ltd, which operates a logistics and warehousing business at the Port of Southampton, for up to £12m. The business, which made a 2017 profit of £1.7m, fits well with Xpediator’s existing business in the port and has a good management team that can help the enlarged operations to grow. It should be earnings enhancing in the first full year. A placing raised £7m at 70p a share.

Fifteen-month figures from healthcare services provider Totally (TLY) include five months from the Vocare acquisition but that was still enough to generate revenues of £42.5m. A full 12 months of Vocare should increase revenues to £85m but Totally would still be loss-making. There is further restructuring and integration required. Cost savings should help Totally move into profit in 2019-20. Net cash was £10.2m at the end of March 2018.

Collagen Solutions (COS) improved its revenues in the second half, compared with the first half, but full year revenues were still 6% lower at £3.83m. There is still £5.02m in the bank. There was growth in EMEA. The eight year clinical study for cartilage repair product ChondroMimetic was successful.

Full year figures from managed communications services provider AdEPT Telecom (ADT) were better than expected. Managed services were more than two-thirds of revenues, which were 35% ahead at £46.4m. Underlying pre-tax profit was one-third higher at £7.7m. Net debt was £17.6m at the end of March 2018.

Strategic Minerals (SML) generated sales of $696,000 from the Cobre magnetite operations in the three months to June 2018, but the suspension of a major contract will hit the current quarter. There was $2.09m in the bank at the end of June 2018 and a payment of $375,000 has subsequently been received.

ECR Minerals (ECR) has raised £650,000 at 0.7p a share and that provides enough cash until the third quarter of 2019. The development programme at the Blue Moon target in Victoria, Australia will be accelerated.

An international mining company has agreed to subscribe $250,000 for shares in Orosur Mining Inc (OMI) and that will help to finance further exploration at the Anza project in Colombia. The subscription is at 5.2p a share, double the market price at the time of the agreement.

Fishing tackle retailer Fishing Republic (FISH) expects interim revenues to decline from £4.1m to £3.4m following the closure of five underperforming stores. Like-for-like store sales were 22% lower and online sales also fell. Inventory levels have fallen.

Clear Leisure (CLP) has started operations at its crypto currencies mining data centre in Serbia.

Battery technology and advanced materials developer Ilika (ILK) has raised £4m at 20p a share and an open offer could raise up to £1m more. The cash will finance the costs of developing battery technology for the automotive market. There was £2.8m in the bank at the end of April 2018.

N4 Pharma (N4P) reported disappointing results from the pharmacokinetic data for the clinical trial for reformulated sildenafil, which is better known as Viagra. The plan is to improve the speed at which the drug takes effect but the formulation has not meet the targets set.

Ariana Resources (AAU) says that the Kiziltepe mine produced 7,171 ounces of gold in the second quarter of 2019 and it is still on course to produce 20,000 ounces of gold for the whole year.

Trading remains tough at replacement windows supplier Safestyle UK (SFE) although order intake has firmed in recent weeks. This follows the loss of staff to a competitor that is being sued by Safestyle. It will take until next year to rebuild the team. Thee will be a loss this year even before £6m of restructuring costs. This will use up the cash in the bank.

Next Fifteen Communications (NFC) is paying an initial £2.2m for Technical Associates Group, which is a technical content and digital marketing business. This deal increases the group’s exposure to the industrial engineering sector.

MAIN MARKET    

More director changes at Quarto Group Inc (QRT) with Andy Cumming appointed as senior independent non-executive chairman. Major shareholder Laurence Orbach has stepped down as executive chairman and will become a non-executive director. Chief operating officer Ken Fund has joined the board.

Nicholas Lyth has resigned from the board of Sealand Capital Galaxy Ltd (SCGL) having been a director for 17 months.

China-focused healthcare investor Cathay International Holdings (CTI) says that the first half sales and profit will be lower than expected but it hopes to make up the shortfall in the second half. Healthcare subsidiary Lansen has appointed a new chief executive and there have been operational changes, while regulation changes also continue to hit sales in the first quarter. The company’s hotel operations are trading ahead of expectations. The interim will be published in late August.

Andrew Hore

Andrew Hore – Quoted Micro 26 March 2018

NEX EXCHANGE   

Continuing revenues from renewable energy supplier Good Energy (GOOD) increased from £89.7m to £104.5m but underlying pre-tax profit was nearly two-thirds lower at £734,000 due to higher admin and interest costs. There was also a decline in gross margin. An increase in working capital meant that there was a £4.92m cash outflow from operating activities. There was a decline in NAV due to the loss on discontinued generation development activities. Net debt was £53.1m at the end of 2017.

Brewer Adnams (ADB) reported a 9% increase in beer volumes in 2017, even though cash sales fell by 5%. Overall sales were 6% ahead at £74.8m despite losing £1m in revenues from the closure of the Swan Hotel for refurbishment. Even if the exceptional expenses of £721,000 for removing asbestos from the Swan Hotel, are added back, the pre-tax profit, excluding disposal gains, fell from £3.59m to £1.6m. Capital investment continues with the IT system being upgraded. The full year dividend was edged up from 226p a share to 228p a share. There plans to produce an alcohol-free version of Ghost Ship.

MetalNRG (MNRG) is selling its 15.4% stake in US Cobalt to ASX-listed Tyranna Resources, which is acquiring the whole of the company. MetalNRG will receive 21.7 million shares in Tyranna at a valuation of A$0.017 a share. The shares are trading at A$0.025, which would value the deal at £300,000. First Sentinel has raised £45,000 at 13p a share and issued a further £25,000 worth of shares at the same price to market maker Winterflood.

Coinsilium Group Ltd (COIN) has exercised its option to take its stake in Indorse to 10%. The additional 3.5% of the company is being bought for £97,000, taking the total investment to £246,000. Singapore-based Indorse has tested its blockchain-based social network for professionals and moved to the Mainnet. A new feature will enable token issuers to verify their advisory board. Coinsilium is advising Bundle Network on its token generating event. Bundle enables people to trade across unconnected cryptocurrency without needing to open individual accounts.

Imperial Minerals (IMPP) has raised £20,000 at 2p a share. There was just over £37,000 in the bank at the end of 2017, following a £35,000 cash outflow in the previous six months. Imperial is still seeking an opportunity in metals, such as gold, lithium, cobalt and zinc.

First Sentinel (FSBN) has appointed Colin Maltby to the board and invested £43,500 in the Union Jack Oil (UJO) placing raising £1.25m at 0.085p a share.

Baron Bloom has stepped down from the board of Etaireia Investments (ETIP) after the publishing of criticism by a judge, who said that he had been dishonest during divorce proceedings with his ex-wife.

Block Commodities (BLOC) has entered into a strategic partnership with blockchain-based financial services platform Wala and token issuer Dala. The businesses will be working together to establish the blockchain-based agricultural commodity trading initiative that Block has been developing. Dala would be used as the token for the food commodities trading ecosystem. Block’s existing joint venture will supply $10m of Dala token loans to 50,000 small farmers in sub-Saharan Africa.

Dana Group International Investments Ltd (DANA) increased its net assets from $0.31 a share to $0.36 a share in 2017. There was a $4.15m increase in the valuation of the investment in Bonyan International Investment.

AIM   

New management at social video content developer and owner Brave Bison (BBSN) will be judged on this year’s figures rather than the 2017 results. In 2017, revenues fell 48% to £9.1m and cost cutting helped to reduce the underlying operating loss before the restructuring costs and write-offs of acquired intangibles. The cash outflow from operations fell by two-thirds to £1.53m. There is £4.82m in the bank so that provides time for further improvement in performance. Collecting ad revenues for third party content on social platforms remains a significant revenue generator but commissioned sponsored content is becoming an increasingly important fee earner.

Cambridge Cognition (COG) reported a small decline in revenues because of lumpy contract wins in the previous year and the delays to two clinical trials. A small loss was reported but the neuroscience health company is expected to bounce back this year to a profit of £500,000.

Utilitywise (UTW) has finally published its figures for the year to July 2017. More conservative accounting policies mean that an under consumption of energy increased the loss to £8.5m. The utility cost management adviser had a £6.18m cash outflow from operating activities. Net debt rose from £5.5m to £19m and banking covenant breaches have been waived by the bank. The debt increase was partly down to dividend payments but there is no final dividend. The interim results will be published on 23 April.

Energy procurement business Inspired Energy (INSE) increased its underlying pre-tax profit from £7m to £9.7m, while earnings per share were one-quarter higher at 1.57p. Inspired has bought SystemsLink 2000, whose software Inspired uses, for £3.875m and Energy Cost Management, which specialises in water management services, for up to £2m.

Rose Petroleum (ROSE) is confident that the 3D seismic data that has been acquired over the Gunnison Valley Unit on the Paradox oil and gas acreage in Utah provides the information required to decide a drill site for the fourth quarter and attract a farm-in partner to help finance the drilling. There are ongoing discussions with prospective partners and this should ensure that the current cash in the bank will last longer. Last September, £3m was raised at 4p a share.

Immupharma (IMM) says that it expects results from its phase III trial for Lupuzor by mid-April. The Lupus treatment has generated the required data and this will be analysed.

Wynnstay Group (WYN) continues to benefit from improved sentiment in the farming sector. Feed demand is above last year’s levels and grain volumes are improving, although margins are squeezed. Like-for-like retail sales are higher and an outlet has been acquired in mid-Wales.

Trading in Green and Smart Holdings (GSH) shares has been suspended because it will not publish its 2016-17 accounts by the end of March. The audit should be completed by the end of April.

CloudCall Group (CALL) grew revenues by two-fifths last year. The underlying loss was £2.6m and further investment in sales and marketing means that even though revenue growth could be near to last year’s level the loss will be similar. The recurring cloud-based software and telecoms services revenues that will be generated from the investment will reduce the loss and move the business into profit in the following two or three years.

James Latham (LTHM) says that its figures for the year to March 2018 will be in line with expectations. This reflects an improvement in the second half. The Wigston timber depot has been moved to a new site.

Parity Group (PTY) has signed a managed services deal with Primark Stores and, along with other extensions, this takes annual revenues from this area to £5m plus. Primark is important because most of the clients on this side of the business are in the public sector. Parity can generate £2m of cash a year.

Gama Aviation (GMAA) reported a 28% rise in underlying operating profit to $18.7m. The main growth has come from the aircraft management business, which was boosted by acquisition in the US. There were also improvements in Europe and Middle East. Gama is investing in two new ground maintenance sites in the US and this continued investment is holding back short-term profit for this division.

KCR Residential REIT (KCR) has raised £1.56m at 70p a share and capitalised loans of £1.59m. The cash will be invested in the private rental portfolio. Debt has been reduced to 45% of investment property value. Energiser Investments (ENGI) has taken a 24.7% in KCR by subscribing for shares and capitalising its £494,000 loan.

There was a cash outflow of £738,000 at Botswana Diamonds (BOD) in the six months to December 2017. That was before the £865,000 raised in a share issue. There is £230,000 left in the bank. A scoping study is being undertaken at the Thorny River project in South Africa. Drilling continues at the Ontevreden project.

Golden Saint Resources (GSR) is asking for shareholder backing for leaving AIM on 24 April. It still plans to acquire EMS Wiring Systems but it wants to join the standard list after the deal goes through.

OKYO Pharma Corporation left AIM on 23 March and the company has migrated to Guernsey. A special dividend payment is planned.

NWF has received bid acceptances for the equivalent of 42.6% of the share capital of Stellar Diamonds (STEL).

Directa Plus (DCTA) has entered into an agreement with Sartec to develop a system to treat contaminated water in the oil and gas sector by using the Grafysorber technology. Directa Plus provides the technology and support while the partner will finance the development of the first plant, starting in the second quarter of 2018.

Noel Collett is stepping down as chief executive of retail butcher Crawshaw Group (CRAW) but he will remain while a replacement is found. Finance director Alan Richardson plans to move to a new job in May. Crawshaw is estimated to have lost £2m in the year to January 2018, Trading has been poor in the first six weeks of the new financial year. There was £5m in the bank at the end of January 2018, which is similar to the company’s market capitalisation.

Grafenia (GRA) says trading has been mixed. Volumes and margins in the printing business have been below budget in recent months. Grafenia is trying to replace these revenues with licence fees, signage and website sales. Full year revenues will be two-fifths higher at nearly £15m and the loss will be similar. Net debt will be around £2.85m.

Gaming Realms (GMR) has sold two affiliate businesses for up to £2.4m. Their revenues have been declining. In 2017, group revenues were flat at £31.6m but continuing operations made a positive underlying EBITDA. Real money gaming revenues were 5% higher but social revenues were lower. New licensing deals have been signed with the likes of 888 and Golden Nugget Casino this year.

Vipera (VIP) says that 12.5% shareholder Sella Open Fintech Platform is contemplating making a bid for the mobile financial software developer.

Gatemore has taken its stake in TLA Worldwide (TLA) to 7%. Gatemore took its initial stake just after trading in TLA, which is most famous for publishing a profit warning after trading had finished prior to Christmas 2016, recommenced after it published its 2016 figures last November.

Harwood Wealth Management (HW.) is paying £4.6m, plus £1.54m for cash balances, for Southampton-based AE Financial Services. The business generated a profit of £500,000 last year.

Altona Energy (ANR) has reviewed the data for the Westfield tenement and put together a three phase drilling programme. This will cost A$1.5m in total, with the first phase costing A$230,000. The second phase will help to define a JORC resource. The final phase will be part of the preparation of a bankable feasibility study. The drilling is targeting shallow coal seams.

More bad news from toilet tissue manufacturer Accrol Group Holdings (ACRL) and the share price has fallen by three-quarters. The loss is going to be higher than expected. Net debt will be £34m by the end of April.

MAIN MARKET    

London and Associated Properties (LAS) says that the tenant of Brixton Markets has exercised its pre-emption rights to acquire the markets. Market Village will pay £37.25m for assets that have a book value of £24.5m.

Bluebird Merchant Ventures Ltd (BMV) says it has made swift progress at the Kochang mine and sampling of the underground workings is ongoing. This has cost $65,000 so far. Feasibility studies at Kochang and Gubong should be completed in the third quarter of 2018. Bluebird has to spend $500,000 on each project to earn 50% in a joint venture for each project with Southern Gold.

Andrew Hore

Quoted Micro 27 March 2017

NEX EXCHANGE

Brewer Adnams (ADB), 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 decline in sterling increased the price of hops and wine, which hit the retail operations. 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. Adnams sold the UK distribution rights to Lagunitas beer. 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. This year there will be the first beer duty tax increase in four years.

Investment company First Sentinel (FSEN) joined the NEX Exchange growth market on 24 March and pre-IPO £633,000 was raised at 10p a share. That is before costs of £130,000. The founding shareholders own 99.2% of the company with 50,000 shares issued to the market maker. The company’s strategy is to provide investments to small companies with an opportunity covering more than 1,000 quoted companies identified in the UK, Europe, Asia and Australia. First Sentinel is run by former Rangers International Football Club director Brian Stockbridge and the main shareholders are two other former directors of Rangers or its subsidiaries, James Easdale and Sandy Easdale. The company is employing Stockbridge’s corporate finance business First Sentinel Corporate Finance, which will receive an annual fee of 1% of First Sentinel’s assets under management (payable at 0.25% each quarter) plus performance fees based on 20% of pre-tax profit each year when the gross return on capital is less than 20% or 40% of pre-tax profit if the gross return is more than 20%. First Sentinel will be paid 50% of deal fees generated by First Sentinel Corporate Finance from any investment transactions involving the NEX-quoted company. Stockbridge and his partner Aimee Freeding each receive £2,000 a month from First Sentinal. The whole board will be paid £72,000 a year in fees. There are currently 6.36 million shares in issue, with nearly as many shareholder warrants, but the company intends to issue up to 100 million more shares. Stockridge and Freeding have director warrants that enables each of them to receive 10% of the enlarged share capital at the time they are exercised – they each currently own 8.1%. Fellow director Tom Dignall has directors warrants over 5% of the enlarged capital at the time of exercise. The warrants are exercisable over five years. Matthew Rice is the independent director and he has no interest in the present or future share capital. First Sentinel is an investment for fans of Stockbridge.

Angus Energy (ANGS) expects to issue a first tranche of bonds on or around 27 April. Angus plans to issue up to £3.5m secured bonds maturing on 30 June 2022 and these will be quoted on NEX.

A rise in the zinc price has provided further impetus for IMC Exploration (IMCP). A comprehensive zinc works programme on its licences that are between the existing Tynagh and Silvermines deposits in Ireland.

Imperial Minerals (IMPP) is more optimistic about the prospects of the resources sector than one year ago. There was £66,000 in the bank at the end of 2016 and since then Imperial has sold its remaining shares in North River Resources for £30,000.

MetalNRG (MNRG) has raised £295,000 at 0.5p a share – every two shares have a warrant to subscribe for one share at 1p – and directors have exercised options at the same price that provide a further £47,500 – every option exercised sparks the issue of a bonus option exercisable at 0.75p a share. This takes the cash in the bank to £480,000, which will be used as working capital as the company seeks suitable investments. Gervaise Heddle has become a non-executive director. Heddle already owns 9.51 million shares in MetalNRG and he will not receive any pay until the company’s NAV is more than £1.5m but he has been issued 3 million options at 0.5p each.

Ecommerce technology provider Netalogue Technologies (NTLP) has signed an agreement with Sage. Netalogue’s ecommerce platform complements Sage’s X3 ERP technology and the deal could help Netalogue to access new customers.

NQ Minerals (NQMI) has raised a further £32,000 at 8p a share.

AIM

Gatemore Capital Management has requisitioned a general meeting at DX (Group) in order to remove Bob Holt and Paul Murray from the board. The plan is to replace them with Ron Series (as chairman), Paul Goodson, Russell Black and Lloyd Dunn. Gatemore is an activist investor that has been involved with French Connection and Gym Group in recent months. Gatemore’s stake in the parcel deiivery company rose above 3% six months ago and the stake has been built up to 11.3%.Furious 7 live streaming film

Pebble Beach Systems (PEB) formerly Vislink, has taken a reduced payment for its broadcast technology division. Former AIM company xG Technology Inc, which has spent more than a decade failing to develop its own business into a profitable operation, is paying $2m of the $4.9m it still owed in the agreement. Net debt has been reduced from £17m to £12m via the disposal and there is potential to obtain $2m from a creditor. The problem is that the remaining software business is too small to prosper with that level of debt.

SalvaRx Group (SALV) is investing in Rift Biotherapeutics Inc, which is developing antibodies for use in oncology. An initial investment of $1m will give SalvaRx a 30% stake in Rift. If the company achieves milestones then SalvaRx could invest a further $1.5m at the same valuation and swap its shares for the shares in Rift held by the other shareholders.

Tracsis (TRCS) had already warned that its interims would be weak. In the end, revenues were one-fifth higher at £15.6m and underlying profit was 11% higher at £3.1m.The cash balance improved to £12.7m. The interim dividend was raised by one-fifth to 0.6p a share. Management is still confident that the second half will be significantly stronger.

Caledonia Mining (CMCL) increased its production, cut costs and received a higher gold price in 2016. The Blanket mine increased gold production from 42,804 ounces to 50,351 ounces and all in sustaining costs fell from $1,037/ounce to $912/ounce. The gold price achieved rose from $1,139/ounce to $1,232/ounce. Production and costs are set to continue to improve. There was $23m generated from operations last year, more than enough to cover capital expenditure and dividends. The annualised dividend is running at 5.5 cents.

Starcom (STAR) continues to be accident prone. Last year, it could not satisfy demand for Watchlock Pro because parts were not delivered. This meant that full year revenues were flat at $5.13m although the post-tax loss fell from $1.76m to $1.36m. There was $35,000 in the bank at the end of 2016.

MAIN MARKET

Falcon Acquisitions Ltd (FAL) is acquiring two businesses involved in technology, distribution and content operations in the Over The Top television sector. Falcon has raised £4m at 25p a share to provide finance for the enlarged business. The plan is to offer a platform to customers as well as its own content via its own channels. The shares should be readmitted on 27 March. The company will be renamed Falcon Media House Ltd.

Telecoms company Toople (TOOP) is finding it difficult to win business. Apparently, Toople’s main offering to small businesses is not as competitive as it thought so it is focusing on its cloud-based telephony service, which is building up its revenues. The share price has slumped from 8p to 3.25p in less than one year. According to last year’s prospectus, chief executive Andrew Hollingworth gets £120,000 per year (as well as 35 days holiday plus bank holidays) while he acquired his 26 million shares in Toople at 0.0667p each. Finance director Neil Taylor gets £60,000 a year for a two day week. In 2015-16, gross profit was £78,000 while the cash outflow from operations was £1.42m. It appears that the outflow should slow in the first half of this financial year but it will still be significant. There was £744,000 in the bank at the end of September 2016 but there was also debt of £469,000. Given the vast overheads for a company of this size it is no surprise that Toople needs to raise working capital. The trading statement also says that the board “continues to focus on tight cost control” and hopefully they will be able to think of some excess costs that could be reduced.

Books publisher Quarto Group (QRT) has sold its 75% stake in Hong Kong-based Regent Publishing Services for $7m – a gain of $3.3m on book value.

Andrew Hore

 

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