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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 15 October 2018

NEX EXCHANGE        

Smart home products supplier Sandal (SAND) reported a decline in overall revenues from £3.75m to £3.62m for the year to May 2018, but this masks the 71% growth of the Energenie MiHome revenues to £1.01m. Sandal reduced its operating loss and there was nearly £51,000 in the bank, although net debt was £1.09m.. A small profit is forecast for 2018-19 with a small increase in net debt expected. Sandal may need additional cash to increase the marketing for the Energenie MiHome brand.

High Growth Capital (HASH) has raised £500,000 at 0.8p a share, which was a 77% premium to the market price. Malcolm Burne and Professor Michael Cain have left the board and been replaced by Jens Zimmerman, who becomes non-executive chairman. The investment strategy will be widened from medicinal cannabis, because of a lack of opportunities, to technology. The company intends to acquire a 9.8% stake in Belgium-based artificial intelligence software developer Sentiance. The software enables companies to understand user behaviour. The data comes from smart devices. The technology is used in areas, such as insurance, health and car driving.

Asia Wealth Group Holdings Ltd (AWLP) improved its interim revenues from $1.15m to $1.24m. The pre-tax profit fell from $162,000 to $66,000. There was $1.4m in the bank at the end of August 2018.

Equatorial Mining and Exploration (EM.P) has published its 2017 figures and interims to June 2018. The full year loss was £294,000 and the interim loss increased from £117,000 to £162,000. There was £53,000 in the bank at the end of June 2018. The company is beginning to ship coal from its mine in Nigeria.

Positive Healthcare (DOC) has appointed KSA Group Ltd to liquidate the company.

Shen Chaohuli has sold his 18.3% stake in TechFinancials Inc (TECH) to Ou Qiao.

AIM  

Patisserie Holdings (CAKE) has received a cash injection to keep it going, after unknown overdraft facilities were discovered. The cash balance in the recent accounts does not appear to exist. A placing has raised £15.7m at 50p a share. Chairman Luke Johnson is also providing loan facilities of up to £20m.

EKF Diagnostics (EKF) has revealed details of the spinning off of Renalytix AI on AIM. Renalytix AI is raising cash at 121p a share as part of the flotation, which should happen on 31 October. EKF will distribute its near-21 million shares in the company to its own shareholders, although it will subscribe for new shares. EKF shareholders will also get the chance to invest up to £3.5m in new shares.

Diversified Gas and Oil (DGOC) is making another major acquisition. The oil and gas producer is paying $183m for Core Appalachia, which is funded by cash and shares issued at 115p each. The deal is immediately earnings enhancing.

Vertu Motors (VTU) has been hit by a lack of cars due to the newly installed testing procedures but it still has a strong balance sheet and it will make a significant full year profit. September registrations were the worst since 2011 and Vertu was not immune. That will hit the second half. There was an improved performance in the used car market to help offset the weaker new car sales in the first half. Pre-tax profit is expected to decline from £28.6m to £22.1m in the year to February 2019.

Marshall Motor Holdings (MMH) has reaffirmed that it is on course to make a full year pre-tax profit of £24.2m, down from £29.1m in 2017.

OnTheMarket (OTMP) has increased its spending on marketing and IT since floating on AIM and this has pushed it into loss. A full year loss of £14.7m is expected and there is not likely to be much of a reduction the following year. The online property platform has succeeded in doubling the estate agency offices using the service to more than 11,000 many of the additional offices are in a trial period and not paying to put their properties on the platform. The investment being made will only be justified if these offices start to pay fees. The IT investment will enable the company to offer more products and services and increase revenues that way as well.

Access Intelligence (ACC) is acquiring ResponseSource, which provides SaaS-based services to the PR and media sectors, for £5.5m. This company fits well with the group’s existing business. A ten-for-one share consolidation is planned.

Health monitoring equipment developer LiDCO Group (LID) is still going through the transition from a sales model to one based on regular income from hospitals. Interim recurring revenues increased by 11% but total revenues were 8% lower at £3.6m. Importantly, there should be enough cash in the bank to move the business towards profitability. That could happen in 2019-2020 but is more likely to be the following year.

Melissa Blau is stepping down as chief executive of Veltyco (VLTY) fewer than seven months after she was appointed. The shares price has fallen by three-fifths in the subsequent period.

Online women’s fashion retailer Sosander (SOS) has raised £3m at 32p a share, which is more than double the flotation price of 15.1p a share. First half revenues were £1.84m.

MAIN MARKET   

Titon (TON) has firmed up its plan to move to AIM. The window components manufacturer expects to join AIM on 10 December.

Toople (TOOP) says trading in the first week of its new financial year is ahead of expectations. The statement remains, as ever, light on proper financials and indications of losses. Toople raised £2.2m at 0.3p a share, so it has enough cash for the time being.

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 22 January 2018

NEX EXCHANGE

Capital for Colleagues (CFCP) reported a decline in full year revenues from £560,000 to £372,000 and there was no repeat of the realised gains on investments in the previous year. There was an increase in unrealised gains from £71,000 to £317,000. However, there was a £1.32m investment impairment. This meant that a profit of £158,000 was turned into a loss of £1.17m. There is £1.28m in the bank. The employee-owned businesses investor is focusing on managing its portfolio and the advisory business spun off into a joint venture. The NAV is 42.7p a share.

First Sentinel (FSEN) has invested the £1.4m it raised when it joined NEX last year. These investments include fellow NEX-quoted company NQ Minerals, where First Sentinel boss Brian Stockbridge is chairman, AIM-quoted UK Oil and Gas Investments and AIM-quoted Premier African Minerals. There is a £65,000 loan to unquoted tea cafés operator Yumchaa, where Stockbridge is 50% shareholder. The loan has an interest rate of 12% and lasts until October.

Block Energy (BLOK) has further delayed the planned move to AIM. The oil and gas company has a new expected admission date of end-February. Trading remains suspended on NEX.

AIM

Mark Watkin Jones intends to step down as chief executive of student and private rental accommodation developer Watkin Jones (WJG) but he will stay until a successor is identified. In the year to September 2017, revenues were 13% higher at £301.9m and underlying operating profit rose by a similar percentage to £42.7m. The dividend was 6.6p a share, equivalent to a 10% increase if Watkin Jones had been quoted for all the previous year. Investor demand for student accommodation and private rental residential property remains strong.

Van Elle (VNL) has an outstanding debt of £1.6m from failed facilities management and construction company Carillion. finnCap has also assumed lower second half profit of £1.3m relating to expected business from Carillion. The specialist piling contractor has a poor record since floating and this does not help.

Engineering and IT recruitment company Gattaca (GATC) says that most of Carillion’s debt to the company is insured with around £100,000 uninsured. Premier Technical Services (PTSG) says that it has £800,000 of annual revenues with Carillion with £300,000 still owed. Elsewhere, business is in line with expectations. Bilby (BILB) says that it does not think that the contract with CarillionAmey will be impacted.

Sinclair Pharma (SPH) directors have been buying shares on the back of the news that it has received regulatory approval of Ellanse pre-mixed bioresorbable collagen stimulating fillers in Brazil, one of the most important global markets. Ellanse will be soft launched immediately and the full launch is a matter of weeks away. Other Sinclair dermatological products are selling well in Brazil.

K3 Capital (K3C) reported interim figures that were better than forecast. This led to a £1m increase in forecast full year revenues but the pre-tax profit forecast is maintained at £5.4m because of additional costs required to accelerate the growth of the business. The business broker and corporate finance adviser announced an interim dividend of 2.85p a share and a total dividend of 8.2p a share is forecast for the full year.

Full year trading at Midwich (MIDW) was better than expected with revenues 28% ahead at £470m, helped by acquisitions performing ahead of expectations. The audio visual equipment distributor has also improved gross margin. The 2017 results will be published on 13 March.

Utilitywise (UTW) has changed its accounting policy relating to initial revenue recognition of new contracts.

LiDCO (LID) has signed up a new Japanese distributor. Merit Medical has a three year exclusive agreement and there is potential to significantly increase last year’s sales of £117,000. The LiDCOunity version 2 monitor has been approved in Japan.

African Battery Metals (ABM) is the new name for Sula Iron and Gold. Prior to the name change, £1.75m was raised and the Riverfort facility terminated with an associated buy back of shares. ABM is paying $100,000 ($50,000 is still outstanding) for a 70% stake in cobalt licences in the Democratic Republic of Congo. The other shareholder will retain its 30% stake up until a decision is made to mine, so ABM will pay the exploration costs.

Orosur Mining Inc (OMI) produced 7,052 ounces of gold at an average cash operating cost of $867/ounce in the second quarter and plans to produce at least 30,000 ounces in the financial year. Although the South America-focused gold producer and explorer generated $2.16m in cash in the second quarter, there was a $251,000 loss in the period because the all in sustaining cost was higher than the gold price received. Asset Chile has forfeited the 16% stake it earned in Anillo because it did not move into phase 2 of the project.

Shareholders have approved share buybacks by China New Energy Ltd (CNEL) until the end of 2019. Up to one-fifth of the shares can be acquired for less than 2p a share. The bioenergy technology developer and operator increased revenues from £8.85m to £24.7m in 2017 and the order book is worth £13.7m. The company was profitable last year and anticipates it will be in 2018.

Data software company WANdisco (WAND) says bookings increased 45% to $22.5m in 2017 with two-thirds generated by WANdisco Fusion software. There was cash of $27.4m at the end of 2017, with $4m from a new growth capital facility.

Thor Mining (THR) has had its stake in US Lithium diluted to 20.8% due to a A$240,000 fundraising at A$0.12 a share, which is four times the Thor acquisition price. US Lithium plans an ASX-listing.

Veltyco Group (VLTY) is acquiring a 51% stake in Varkasso, which has exclusive rights to use the crypto wallet technology platform 8Crypt, for £265,000 in cash and shares. Veltyco will incorporate the 8Crypt crypto wallet in all the gaming platforms it is involved with.

Newmont Mining has decided not to become involved in the Greatland Gold (GGP)-owned Ernest Giles gold project in Australia. It appears that the project was not in the right place or large enough for Newmont to go ahead with, although it took its time to make a final decision. Greatland benefits from the work conducted by Newmont, which has identified a large gold anomaly. Targeted exploration will be undertaken at Ernest Giles in the first quarter of 2018.

Kodal Minerals (KOD) says that the authorities have approved its exploration licences for the Bougouni lithium project in southern Mali. Triumvirat Mining Company will have a 10% economic interest in the licences, which are for an initial three year life. There has been positive drilling news concerning the Ngoualana and Sogola-Baoule prospects.

Electrical accessories supplier Volex (VLX) moved from the Main Market to AIM on 19 January.

Waste gasification technology business EQTEC (EQT) has partially repaid a five-year, £1.1m loan facility with an annual interest rate of 15%. The remaining balance of £621,000 is repayable in July 2020. The £2m of convertible secured loan note with Altair Group Investment Ltd has been extended until July 2020 and the interest rate doubled to 15%.

Renewable fuels technology developer Velocys (VLS) has raised £14m via a placing at 10p a share and hopes to raise up to £4.4m through an open offer at the same price. Last year, there was a £1.16m share issue at 45p a share. The cash will be used to finance initial development of the Mississippi biorefinery and fund the UK waste-to-renewable jet fuel project which has been around for many years.

Generic drugs supplier Beximco Pharmaceuticals (BXP) expects to complete the £18.2m acquisition of a 85.2% stake in Nuvista Pharma by the end of February.

Gama Aviation (GMAA) says last year’s trading was in line with expectations. The business aviation services provider has incurred $1m of costs relating to legal proceedings and there will be a similar amount to come. There will be around $2.5m of restructuring costs and write-downs. Net debt fell from $19m to $13m.

Although Blancco Technology Group (BLTG) says that first half sales declined this is due to the fact that certain contracts were not repeated in the latest period. The data erasure software business is expected to report continuing full year revenues 6% higher at £28.5m. However, higher overheads mean that there will be little profit.

Cyber security software supplier Crossrider (CROS) says that 2017 trading was in line with expectations and revenues improved 16% to $65.8m, while underlying EBITDA was 29% ahead at $8.3m. Profitability from the core activities more than doubled. There was $69.4m in the bank at the end of 2017.

Legend Gold Corp shareholders have agreed to the arrangement for Altus Strategies (ALS) to acquire the entity that owns the Legend gold projects in Mali in return for 41.1 million Altus shares. The mining projects investor is also applying for a dual listing on the TSX-V. Legend shareholders will be issued three Altus shares for each Legend share that they own, giving them 27.6% of Altus.

Toys supplier Character Group (CCT) says it has exited Christmas with “virtually no excess stocks”. International sales were poor but domestic sales grew. Pokemon products will be launched during the summer.

Caledonia Mining Corporation (CMCL) reported higher than guided annual production at the Blanket gold mine. The prediction was 54,000-56,000 ounces but the outcome was 56,135 ounces.

Sustainable pallets manufacturer RM2 International SA (RM2) had unrestricted cash of $4.1m at the end of 2017, but that could fall to $2m by the end of January. That means that there should be enough cash until the third week in February. Management continues to seek additional finance. There are plenty of potential customers but little in the way of orders.

Tiziana Life Sciences (TILS) has raised a further £150,000 at 150p. This is on top of the £150,000, £275,000 and £200,000 raised at the same price during November and December. There is a warrant with each new share and they are exercisable at 160p a share, although the most recent warrants last until January 2024. The cash is being invested in the phase IIa clinical trial for the Milciclib cancer treatment.
Remote tracking and monitoring products developer Starcom (STAR) says that last year’s turnover improved from $5.1m to $5.5m and lower operating costs mean that it will move from loss to breakeven. Strong orders mean that revenues and margins should improve this year.
Condor Gold (CNR) has obtained a TSX listing.

MAIN MARKET

Path Investments (PATH) is cancelling its standard listing even before finalising its acquisition of a 50% participating interest in the Alfeld-Elze licence and gas field in Germany. The plan is to cancel the standard listing on 19 February and raise money and apply for an AIM quotation in the first quarter of 2018. Path has previously been on AIM in a different guise but if the deal does not go ahead the plan would be to maintain the standard listing.

World Trade Systems (WTS) plans a transaction involving the sale of its assets to a new company that will float on the Channel Islands-based The International Stock Exchange. WTS shareholders will be distributed shares in the new company that will be used to acquire the assets.
Loss-making telecoms firm Toople (TOOP) did not publish a full set of figures on RNS. That is always a giveaway. It did announce that the operating loss declined by 23% to £1.31m in the year to September 2017. Cash flow is much more important for a colander company like Toople.

Technology investment company Sure Ventures (SURE) has joined the Specialist Fund Segment of the Main Market, having raised £3.31m at 100p a share. The main focus is augmented reality, fintech and the Internet of Things.

Challenger Acquisitions Ltd (CHAL) has invested $300,000 in a new giant observation wheel for Dallas, Texas. Challenger also has the opportunity to operate the wheel.

Andrew Hore

Quoted Micro 16 October 2017

NEX EXCHANGE

This month marks the 22nd anniversary of the launch of NEX Exchange, although it was then originally called Ofex. A number of companies have gone on to bigger things, including Genus, which is in the FTSE250 index and accesso Technology, which is one of the top 50 companies on AIM. Further information can be found at http://www.hubinvest.com/AIMPDFOctober2017_97.pdf

MetalNRG (MNRG) has applied for two cobalt licences at Palomino and north Palomino in Western Australia but a rival has applied for the latter licence. There has also been interest from potential acquirers of this interest. A report has been received about the company’s US cobalt interests and this is being reviewed. A potential uranium project has been brought to the company and it is considering the opportunity.

Indigo Holdings (INGO) has invested £10,000 in 3sootjobs, a job search platform in Iran, giving it a 1.53% stake. Turquoise, which owns 32.1% of Indigo, and related parties, including Indigo directors, own around two-thirds of 3sootjobs.

Ecovista (EVTP) has bought a 80% stake in a company that owns a four bedroom property near Stanstead and it has paid £10,000 for an option on the next door property. The properties cover 1.72 acres.

AIM

Parcel delivery company DX (Group (DX.) is raising £24m from an issue of convertible loan notes. The conversion price will be 10p a share and the interest rate 8%. There is potential to issue a further £2m of loan notes. Lloyd Dunn has been appointed as chief executive but he is not on the board. Along with three directors, he is subscribing for £5.25m of loan notes.

Angle (AGL) has further positive indications of the effectiveness of its Parsortix liquid biopsy technology and it has also raised a further £2.8m, taking the total raised at 37.5p a share to £15m. Heinrich Heine University researchers has been able to able to continue to grow circulating tumour cells harvested using a Parsortix device.

Fashion retailer Quiz (QUIZ) performed strongly in the first half and online sales have increased to one-quarter of the total. This was before the launch of a website focused on Spain and there are plans for other international websites. The UK stores grew sales by 15%. Overall revenues were 35% ahead at £56.1m.

Orogen (ORE) is acquiring Thread 35 Ltd and changing its name to Sosandar (SOS), which is the acquisition’s online womenswear brand. The brand was launched on 19 September 2016 by the founders of fashion magazine Look and is aimed at the affluent professional woman. Orogen is paying £6.3m in cash and shares for the acquisition. Ten Orogen shares are being consolidated into one new share. A placing at 15.1p a share will raise £4.8m net to cover the cash portion of the acquisition cost.

Toilet tissue supplier Accrol Group Holdings (ACRL) expects to pay between£550,000 and £2.9m and because of its guilty plea the amount will be discounted by one-third. The figure will be announced early next year. Talks continue with major shareholders and the bank.

Wynnstay Group (WYN) has appointed administrators to Just for pets and 18 of the stores have been sold to PSR Ltd. The other seven have been closed. The loss-making pet products retailer had net assets of £2.2m.

Crop enhancement products supplier Plant Impact (PIM) increased its full year revenues by 17% to £8.5m even though sales in Brazil were disappointing. Higher research and development spending meant that there was a £3m loss. There was £7.2m in the bank at the end of July 2017. Plant Impact is moving into new geographic markets as well as building share in its existing markets.

Motor dealer Vertu Motors (VTU) intends to use some of its cash to buy back up to £3m worth of shares. There was net cash of £20.8m at the end of August 2017. Interim revenues were flat at £1.45bn buy underlying pre-tax profit was 7% higher at £20.9m.

Patrick O’Sullivan, who failed to gain a board seat at Conroy Gold and Natural Resources (CGNR), has reduced his stake in the Irish gold explorer to three million shares (24.6%). Conroy was awarded costs of the court proceedings made by Patrick O’Sullivan and the level is still to be assessed. Conroy has decided to cancel its quotation on the Dublin-based Enterprise Securities Market on 6 November. Conroy will still be quoted on AIM so shareholder approval is not required. Andrea Gonella currently owns less than 3% of Conroy, having owned more than 6% in July. Conroy has raised €240,000 via a €0.30 a share placing and a further €167,000 was raised from warrants taken up by directors Professor Richard Conroy and Maureen Jones.

Digital Barriers (DGB) has decided to sell its video business for up to £27.5m. It will concentrate on its Thruvision people screening business.

InterQuest Group (ITQ) has appointed Allenby as its nominated adviser and Peterhouse as its broker so trading in the shares has recommenced. Chisbridge Ltd ended up with 58.3% of InterQuest after its bid. It still wants to ditch the AIM quotation and it can buy shares in the market in order to increase the stake.

Patient monitoring device developer LiDCO (LID) has gained its first long-term high use programme contract with a US customer but that did not contribute in the first half. In the six months to July 2017, revenues were 4% higher at £3.9m and the loss was £1m. That was due to higher sales and marketing costs without the benefits of higher sales yet showing through.

1Spatial (SPA) has sold its non-core assets so that it can focus on geospatial data. There is particular potential in the US market. Although interim revenues were flat at £12.1m but a greater proportion were from the geospatial business. The operating loss was reduced from £1.9m to £1.2m and the cash outflow in the period was minimal. Claire Milverton has been confirmed as chief executive.

Two graphene-related companies are raising cash. Applied Graphene (AGM) has raised £9m at 36p a share and existing shareholders are being given the chance to subscribe for up to £1m via a one-for-eight open offer. There was £4.7m in the bank at the end of July 2017. The cash is being used to finance joint development activity for the strategic ink programme, which uses 2D inkjet printing to deliver graphene-based inks. Other potential uses are also being explored. Haydale Graphene Industries (HAYD) is raising £10m via a placing and offer at 120p a share, which was a 32% discount to the market price. Haydale recently changed broker to Arden. The cash will be used to provide working capital for existing orders and to develop new uses for graphene, including cookware.

SaaS-based accounting software supplier FreeAgent Holdings (FREE) says that it generated interim revenues of £4.6m, compared with £3.6m. There was a smaller first half loss and had net cash of £3.4m at the end of September 2017.

Top level domain names owner and distributor Minds + Machines (MMX) has received approval from the authorities in China to sell .law, .work, .beer and the Chinese equivalent of .shopping. Four more extensions are going through the approvals progress. So far, revenues from China for .vip have been a significant contributor to group revenues.

A consortium led by former chief executive Peter Earl is in early discussions with Rurelec (RUR) about a bid that could be backed by Rurelec’s joint venture Patagonia Energy Ltd.

An application to enable Redx Pharma (REDX) to get back control of its main subsidiary will be heard on 26 October. If approved, the subsidiary will come out of administration and the suspension of trading in Redx shares could be lifted.

Realm Therapeutics (RLM) has completed the £19.3m placing at 29p a unit (one unit is one share and a warrant for 0.4 of a share). The warrants provide an opportunity to subscribe for a share at 58p each. The initial focus of the cash will be the treatments PR022 for atopic dermatitis and PR013 for allergic conjunctivitis. There are also plans for a phase II trial for the PR023 treatment for acne vulgaris.

PipeHawk (PIP) has sold its 28.4% stake in south east England-based survey practice SUMO Ltd to its own executive chairman Gordon Watt for £197,499. That is the equivalent of the investment in loss-making SUMO and is more than its value in the books.

Dr Cliff Holloway has been appointed as chief executive of Scancell Holdings (SCLP) and he will push forward the immunotherapy platforms being developed by the company. His predecessor Dr Richard Goodfellow is remaining on the board. Scancell had £2.67m in the bank at the end of April 2017, which was less than the cash outflow in the previous 12 months.

Ashanti Gold Corp says that the Anumso gold project, where Goldplat (GDP) is earning up to 75% through a $3m investment in exploration, has broader and new mineralised zones. Soil sampling has produced good results and suggests high gold recovery rates.

Former AIM company Zenith Hygiene has agreed a cash bid from BCPE Diamond UK. The deal values Zenith at £100m, based on its enterprise value, although the final amount depends on performance.

MAIN MARKET

Cash shell J2 Acquisition Ltd (JTWO) commenced trading on the standard list on 10 October, having raised $1.25bn. The shell is seeking a company with a strong market share and proven track record. If an acquisition is not made within two years, shareholder approval will be required for a further 12 months of operation.

Levrett (LVRT) has completed the acquisition of Nuformix Ltd for £12m in shares at 4p each and it has changed its name to Nuformix. A further £2.3m has been raised at 4p a share. Trading will recommence on 16 September.

Sealand Capital Galaxy (SCGL) has signed a memorandum of understanding with AIM-quoted MySQUAR (MYSQ) that will enable the two companies to distribute each other’s mobile games.

Monchhichi (MCC) still intends to follow Pembridge Resources (PERE) from AIM to the standard list but the move has been delayed until mid-November. This will follow shareholder approval for the €10m investment in artificial intelligence, machine learning and behavioural data science company Sentiance and the approval of the prospectus by the UKLA. Sentiance lost more than €2m on revenues of €1.4m in 2016.

WideCells Group (WDC) plans to launch its CellPlan insurance for stem cell treatment in Spain before the end of the year. A partner has been secured for the expansion of stem cell services in the Middle East, north Africa and Asia Pacific. White Apex General Trading will be exclusive strategic partner for three years.

Andrew Hore

Quoted Micro 14 August 2017

NEX EXCHANGE

Brewer Adnams (ADB) continues to grow its beer volumes and Ghost Ship is behind much of that growth. Interim revenues improved from £31.2m to £33.2m, while there was a swing from a pre-tax profit of £1.86m to a £284,000 loss. There is a one-off cost of £721,000 mainly due to a write down in the value of the Swan Hotel and the costs of removing asbestos and a reduction in the disposal profit from £1.42m to £526,000. Even so, there was a still a sharp drop in underlying profit. The closure of the Swan Hotel knocked £550,000 off profit even before the one-off charges. Beer and spirit sales improved even though the Lagunitas beer distribution rights were sold one year ago. The B share dividend has been increased by 2p a share to 78p a share and the A share dividend has been improved by 0.5p a share to 19.5p a share. The capital investment programme is near to completion and bank debt has risen to £14.4m.

Secured Property Developments (SPD) is still finding it difficult to suitable investment. There was a £12,000 loss in the six months to June 2017. There is £310,000 in the bank and debtors of £415,000. Mark Jackson has increased his stake from 7.6% to 8.6%.

NQ Minerals (NQMI) has raised A$1m at 10 cents a share and A$49,000 at 12 cents a share. NQ has also appointed Adrian Lungan to the board as a non-executive director. He effectively owns 11% of NQ.

Coinsilium Group Ltd (COIN) has an option to acquire 7% of Singapore-based Indorse for SG$350,000. The option lasts for three months and Coinsilium has already invested SG$100,000 (£56,000) via a convertible loan. Along with the convertible, the stake could be 10%. Indorse plans to develop a blockchain-based decentralised network for professionals and it has raised $5.37m from a token pre-sale, which continues until 7 September. Coinsilium received Indorse tokens as part of the convertible investment.

AIM

Share (SHRE) had a strong first half in 2017 and Cenkos has upgraded its forecast on the back of the interims. Revenues generated by the owner of The Share Centre retail stockbroker, increased from £7.2m to £8.9m even though interest revenues continue to decline. Underlying pre-tax profit jumped from £110,000 to £310,000. The investment in digital, such as the upgraded website and app, are starting to pay off but there should be much more to come. Assets under management were one-quarter higher at £4.3bn. The 2017 earnings per share forecast has been raised by 94% to 0.3p and the 2018 forecast by 36% to 0.4p.

Conroy Gold & Natural Resources (CGNR) is being asked to hold another general meeting by Patrick O’Sullivan, who owns 28% of Conroy. O’Sullivan successfully removed six directors at the general meeting last week. However, Conroy says that the proposed appointments of Patrick O’Sullivan, Paul Johnson and Gervaise Heddle did not comply with the company’s constitution. The plan is to remove the three directors not affected by the original requisition: Professor Richard Conroy, Maureen Jones and Professor Garth Earls.

There have been more departures from Real Good Food (RGD) and this includes executive chairman Peter Totte. Finance director David Newman has also stepped down and he is replaced by Harveen Rai. Hugh Cawley becomes a non-executive director and Pat Ridgwell is interim chairman. Christopher Thomas moves from non-executive to executive director.

Fiserv has edged up its bid for Monitise (MONI) from 2.9p a share to 3.1p a share, which values the mobile technology company at £75m. Gross cash was £22.2m at the end of June 2017.

Fox Marble Holdings (FOX) has signed a three year agreement with US distributor Pristine Stone NYC, which will act as marketing sales and distribution agent in the US. As part of the deal Fox Marble gets a 5% stake in Pristine, which itself will receive 750,000 warrants in Fox Marble exercisable at 2p a share although that depends on achieving minimum volumes of $1.5m over three years.

Prospex Oil & Gas (PXOG) is acquiring a 50% economic interest in the EIV-1 Suceava concession in north east Romania for €750,000 plus the promise to finance €550,000 of this year’s work programme. The operator Raffles Energy owns the other 50%. The area includes an undeveloped discovery but the investment does not include the two producing fields in the area.

LiDCO (LID) has signed its first high use contract in the US. The patient monitoring devices developer has signed a two year contract with a potential two year extension. This order covers 44 monitors. However, disappointing sales in Europe and China, where a registration process has been messed up, have led to a forecast downgrade for this year. Interim revenues are 4% ahead at £3.94m but the full year revenues forecast has been cut from £9.5m to £8.6m, still higher than the £8.2m made last year. This means that the loss will be higher than originally forecast and LiDCO is not expected to move into profit next year.

Altona Energy (ANR) has agreed with its joint venture partners that there should be a different strategy for the coal asset at the Arckaringa site in Australia. The new strategy involves producing coal to create gas to generate electricity. Other by-products will be methanol and ethanol. A specialist adviser has been appointed to report on the best way of progressing with the strategy.

MAIN MARKET

North Midland Construction (NMD) reported a more than doubled interim profit. In the six months to June 2017, revenues increased from £129.6m to £135.1m and pre-tax profit jumped from £512,000 to £1.22m. The main reason behind the improvement was a swing into profit by the telecommunications division. There were lower contributions from construction, because of project delays, and water divisions. The power division fell into loss. One customer still accounts for two-fifths of group revenues. The interim dividend was doubled to 3p a share. The FCA has concluded that it will not take any further action on a breach of the related party rules by the Moyle family as controlling shareholders.

Rainbow Rare Earths (RBW) says that the laboratory assessment of material from the main vein at Gasagwe, which is part of the Gakara project in Burundi, showed an average total rare earth oxide grade of 62.17%. Rainbow hopes to start production at Gasagwe by the end of 2017 and it should produce ore for two years. Rare earths prices have strengthened so the ore is becoming more valuable.

Andrew Hore

Quoted Micro 12 June 2017

NEX EXCHANGE

Brewer and pubs operator Daniel Thwaites (THW) says that net debt has increased from £34.1m to £47.6m at the end of March 2017 because of investment in the brewery and pubs plus acquisitions. The benefits of this investment is starting to show through. Full year revenues from continuing operations were slightly lower at £84.4m, while operating profit improved from £11.5m to £12.1m. The total dividend is unchanged at 4.46p a share.

Churchill Mining (GHL) has switched from AIM to NEX although trading in the shares remains suspended. Churchill’s main focus is the international arbitration claim against the Indonesian government.

Good Energy (GOOD) received applications for more than £10m of the corporate bonds on offer. The energy supplier has closed the online offer but postal applications close on 12 June – assuming the maximum application level of £20m has not been reached before this.

Coinsilium Group Ltd (COIN) has invested £56,000 in Singapore-based Indorse Pte Ltd, which is developing Indorse, a blockchain-powered professional social network. Coinsilium will also receive a number of Indorse digital tokens in the next few months.

China CDM Exchange Centre Ltd (CCEP) reported a decline in full year revenues from £1m to £898,000. Pre-tax profit fell by two-thirds to just over £2,000. There is £2.3m in the bank and the NAV was £52.1m at the end of 2016. The company is investing in blockchain technology as part of its growth strategy.

Asia Wealth Group Holdings Ltd (AWLP) says that the 45,000 shares it owns in Ray Alliance Financial Advisers have been transferred to the other two Ray Alliance shareholders without any authorisation. Asia Wealth paid $318,000 for the shares back in 2012. Asia Wealth has demanded that the shares are transferred back.

Valiant Investments (VALP) has raised £45,000 at 0.1p a share. The cash will provide working capital and provide the ability to invest more in apps business Flamethrower.

AIM

DX Group (DX.) has renegotiated the terms of the merger with Menzies Distribution which involves the payment of £40m in cash and shares equivalent to 65% of the enlarged share capital – this includes a 5% stake that will be held by the John Menzies pension fund. DX will still have to take on 17% of the pension fund. Cost savings of £10m a year are expected and a dividend is promised. Rebel shareholder Gatemore is backing the revised transaction. Things are still not running smoothly, though. The City of London police is investigating an allegation concerning DX.

MP Evans (MPE) harvested 180,000 tonnes of oil palm fruit bunches in the first five months of 2017, which is one-quarter higher than in the same period of 2016. This is due to a mixture of improving weather conditions and maturing plants. In the same period, palm oil production increased from 37,900 tonnes to 60.100 tonnes. The average selling price has increased by $51/tonne to $606/tonne, while palm kernel prices moved from $414/tonne to $503/tonne. There could be some downward pressure on prices in the second half.

Somero Enterprises Inc (SOM) has announced a special dividend of 13.3 cents a share on top of the normal dividend. This will cost $7.5m and leave the construction equipment company with much more than $10m in the bank even before allowing for cash generated so far this year. Shareholders on the register on 28 July will receive the dividend. Trading in Europe has been strong and the only disappointment has been North America where business has been delayed.

Best of the Best (BOTB) is also paying a special dividend out of its cash pile. Full year revenues grew 7% to £10.8m, while pre-tax profit improved from £1.1m to £1.5m. A normal dividend of 1.4p a share will be paid plus an additional 6.5p a share as a special dividend. There are also plans for the competitions organiser to increase marketing spending.

Waste to energy systems developer PowerHouse Energy Group (PHE) has secured a collaboration agreement with a UK partner that will provide two tranches of funding for the demonstration unit and five systems. The total funding will be up to £500,000.

DP Poland (DPP) has raised £5.25m at 43p a share. The cash will help finance 15 new Domino Pizza stores in Poland this year and finance loans for sub-franchise store openings in 2019.

Trading in Savannah Petroleum (SAVP) shares has been suspended following an exclusive agreement to buy the oil and gas assets of a west Africa-focused company. The structure of the transaction has been agreed in outline and it will involve debt, shares and cash. Due diligence has been going on since January. The shares will remain suspended until a document is published for the reverse takeover.

Nostra Terra Oil & Gas (NTOG) says that the general meeting requisition at US-focused oil and gas company Magnolia Petroleum (MAGP) is by former chief executive and founder Steven Snead using the shares that Nostra Terra has agreed to purchase. The proposals include the removal of chief executive Rita Whittington and the appointment the Magnolia board of Ewen Ainsworth, chairman of Nostra Terra, and Donald Phillips.

Vianet Group (VNET) has restructured its business into two divisions: smart zones and smart machines. Smart zones is based on the fluid measurement and telemetry business with pubs. The US business is moving towards breakeven. The smart machines division is focused on vending machines and there is a significant addressable market. There was a dip in underlying pre-tax profit form £2.8m to £2.6m last year, with a small improvement forecast for this year. The dividend is set to continue to be unchanged at 5.7p a share.

LiDCO (LID) has received 510k clearance from the FDA for the LiDCO Unity version 2. This will enable LiDCO to offer a high usage programme for a fixed annual licence fee. The head of US operations is already in place and ready to push ahead with the strategy. LiDCO is expected to move into profit in the year to January 2019.

Shareholders are trying to requisition a general meeting at Irish gold explorer Conroy Gold and Natural Resources (CGNR) in order to remove six directors. Seamus FitzPatrick, James Jones, Dr Sorca Conroy, Louis Maguire, Michael Power and David Wathen are the directors that the requistioners wants removed and replace them with Patrick O’Sullivan, Paul Johnson and Gervaise Heddle. The three directors not affected by the requisition are Professor Richard Conroy, Maureen Jones and Professor Garth Earls.

Disruptive Capital has made a bid approach to Stanley Gibbons (SGI).

MAIN MARKET

Telecoms services provider Toople (TOOP) raised £1.41m, before expenses of £150,000, and five million shares were issued to directors’ in lieu of a portion of the fees that they are owned. The subscription and offer are still open. On the day of the announcement, the share price fell 1.13p to 2.13p. There was a cash outflow of £552,000 in the six months to March 2017.

Rainbow Rare Earths (RBW) has discovered several unrecorded veins at Gasagwe, which suggests that there is plenty of upside in the mineralisation resources at the Gakara rare earth project in Burundi. Mine construction is on course to deliver rare earth concentrate before the end of 2017.

WideCells Group (WDC) says that it is authorised to sell its CellPlan financial product that helps people to afford stem cells treatment. There are plans to start selling CellPlan to Biovault stem cell storage customers.

Cathay International Holdings (CTI) says that its 50.56%-owned subsidiary Lansen Pharmaceutical plans to pay a special dividend.

Andrew Hore

Quoted Micro 3 April 2017

NEX EXCHANGE

Hearing equipment supplier DHAIS (DHAP) has reduced the number of stores it operates and that is why its interim revenues fell by 18% to £4.16m but it did move back into profit before notional interest charges. The company continues to reduce its exposure to the mobility sector and concentrate on the supply of hearing aids.

Capital for Colleagues (CFCP) says that its NAV fell to £4.19m (43.5p a share) at the end of February 2016. The company plans to raise £2m at 42p a share.

Black Sea Property (BSP) has pulled out of the deal to acquire development land in Varna because it would not offer a suitable return even though the seller offered amended terms.

Etaireia Investments (ETIP) has completed the acquisition of the company that owns 89 Dalrymple Street, Girvan. The property was valued at £60,000 and the purchase price has been satisfied by £35,000 in cash and 25 million shares at 0.1p each. The cash payment is deferred for 12 months. A new tenant has signed a ten year lease at an initial rent of £12,000 a year.

Trading in the consolidated shares of Ace Liberty & Stone (ALSP) commences on 3 April. Twenty five shares have been consolidated into one new share.

Barney Battles has withdrawn his request for a general meeting at Milamber Ventures (MLVP).

AIM

Staunton Holdings says that it has no intention of increasing its 300p a share offer for FIH (FIH). Rival suitor Dolphin Fund says that it may be willing to offer 333.3p a share in cash but it still wants to discuss its plans with the independent directors.

Fairpoint (FRP) managed to make a small profit in the second half and full year profit was £4.9m, down from £10.5m in 2015. That is before £11.8m of restructuring charges and write-downs. Net debt was £19.9m at the end of 2016 and since then a medico-legal business has been sold for £1.2m. Bank facilities last until May 2019. There will be no dividend. Legal services revenues are expected to fall by 15% in 2017 and then start to recover in 2018. There will be £5m of annual cost savings showing through in the second half of 2017.

Premier African Minerals (PREM) successfully raised £2m at 0.5p a share via PrimaryBid.com. Premier directors Michael Foster and John Stalker have converted £30,000 of fees into six million shares at 0.5p each.

Connemara Mining Company (CON) has acquired five new prospecting licences in Ireland and two of the licences are in areas known for zinc-lead mineralisation – Tonduff and Derrykean. The licences are all north east of the Galmoy and Lisheen mines.

CloudCall (CALL) had 16,200 users by the end of 2016 and they are generating £31/month each. Revenues grew 48% to £3.3m but the operating loss increased from £3.7m to £4.5m. Recurring revenues continue to grow and February was the best ever month. There was £3.2m in the bank at the end of 2016.

Patient monitoring equipment supplier LiDCo (LID) reported full year figures in line with expectations but the next two financial years will provide indications of how well the company’s new strategy is working. The plan is to add high usage accounts in North America following the launch of a new monitor. There will be a significant increase in sales and marketing costs this year and the benefits will not show through until later in the year. This is why LiDCo is expected to slip back into loss before moving into profit in 2018-19.

Evgen Pharma (EVG) has been granted another patent relating to SFX-01. The patent “covers a method of isolation and stabilisation of sulforaphane from a natural source” and lasts until May 2033.

Savannah Resources (SAV) expects to start mining at its Oman copper projects before the end of this year. Ministerial approvals are still required to get a mining licence. Savannah has also established a resource of 4.4bt at a grade of 3.9% total heavy minerals at the Mutamba project in Mozambique.

MAIN MARKET

Path Investments (PATH) is the new name for former AIM company Niche Group. Path joined the standard list on 30 March and it raised £1.4m at 1p a share. The strategy is to acquire production and near-production assets in the oil and gas sector.

Bluebird Merchant Ventures (BMV) has turned its attention to South Korea. Southern Gold Australia has a number of tenements which have abandoned mines on them and there is scope to reopen them. Bluebird intends to earn 50% stakes in individual mines in return for the investment of $500,000. Two former mines have already been chosen – Taechang and Gubong. The plan is to prove resources and then move the mines towards production. Bluebird’s existing assets in the Philippines have been put on hold until the market is more favourable.

Dukemount Capital (DKE) joined the standard list on 29 March. The share price ended the week at 0.45p (0.4p/0.5p), which values the company at £1.5m. A dividend should be paid within two years and the target yield is 10%. Dukemount plans to do this by acquiring, developing and managing property assets. Dukemount will then create long-dated inflation-linked assets which will be attractive to institutional investors.

Stewart & Wight (STE) has bought a retail property in Middlesbrough for £620,000. A ten year lease was signed by HK Foods last September providing annual rent of £45,000. An upward only rent review is due after five years.

Andrew Hore

Quoted Micro 20 February 2017

NEX EXCHANGE

Forbes Ventures (FOR) has taken a 0.84% stake in potential challenger bank Civilised Investments in return for £200,000 in cash. The cash investment was raised through a placing of shares at 0.5p each with Gravity Investments, which owns 62.1% of Forbes. A further six million shares were issued at the same price to settle fees. Civilised is applying for a UK banking licence in June 2016. The strategy is not to have branches but local bankers will provide loans and business banking products by attracting personal savings.

Kryptonite1 (KR1) has invested £99,905 for 25,811 tokens in Melonport AG, which is building its own blockchain protocol for digital asset management built on the Ethereum platform. Melonport raised $2.5m in 14 minutes.

NQ Minerals (NQMI) has raised £128,750 at 0.8p a share. For working capital. Daniel Stewart has been appointed as corporate adviser.

FT8 (GFT) has failed to secure the agreed monthly payments from Billyst Holdings and this means that trading in the shares of FT8 has been suspended because of the company’s uncertain financial position.

AIM

Floorcoverings manufacturer Victoria (VCP) has moved into Continental Europe through the acquisition of Avalon and GrassInc for an initial £9.7m in cash with deferred and contingent payments of up to £12m over four years. This is an important part of the overall strategy for the group and it also takes Victoria into the artificial grass market. The deal should be immediately earnings-enhancing with the two businesses making a 2016 operating profit of £3.6m.

Construction dispute resolution services provider Driver Group (DRV) has raised £8m at 40p a share – a 15% discount to the market price – in order to reduce borrowings and grow the business. There is also a one-for-26p open offer at 40p a share that could raise up to £500,000 – closing on 8 March. Driver has negotiated new banking facilities of £8m, down from £12m, and this expires in 2020. Net debt was £9.9m at the end of September 2016. Driver made a loss in the year to September 2016 but it moved back into profit in the second half. In the past year, Driver has reduced annualised overheads by £1.3m, cut underperforming fee earners, improved cash collection and implemented more rigorous bidding controls. Driver plans to scale down the project management operations and the main businesses should be sold by the end of this financial year. South America and eastern Europe have been identified as growth areas. New non-executive director John Horgan has been appointed as a replacement for David Webster.

Fuel cell technology developer AFC Energy (AFC) has raised £6m, £5.5m net of expenses, at 10p a share – a 40% discount to the market price. Up to £2m more could be raised from a one-for-15 open offer at the same share price – closing on 2 March. The cash will be used to deliver commitments on the joint development agreement with De Nora, additional testing and a scoping study with Peel Environmental for potential projects. Jim Gibson has been appointed as chief operating officer.

Middlesbrough-based pawnbroker Ramsdens Holdings (RFX) joined AIM on 15 February. The placing will raise £15.6m at 86p a share, valuing the company at £26.5m. The share price ended the week at 95.5p.

Tracsis (TRCS) disappointed the market with a warning that delays in contracts means that this year will be even more second-half weighted and there is still uncertainty whether certain software contracts will complete in this financial year. The transportation optimisation software and services provider still believes it can achieve this year’s forecast profit but the market was not as sure. The share price fell by nearly one-third following the trading statement and Downing is one investor that has added to its stake having previously taken profits. Interim revenues will grow from £13.1m to £15.5m but pre-tax profit will only be slightly higher than last year’s figure of £2.9m. The full year outcome could depend on the rail franchise bid timetable.

Higher LED sales helped Holders Technology (HDT) to increase overall revenues by 2% to £11.4m but the LED business is still losing money and a German business has been closed. The underlying loss increased from £141,000 to £195,000, prior to restructuring costs of £183,000. An increases in trade creditors meant that cash improved to £781,000. A final dividend of 0.25p a share is proposed. There are signs of an improvement in demand for printed circuit board materials and new smart lighting products should boost the LED business.

Vela Technologies (VELA) has raised £550,000 from a bond issue via the UK Bond Network. This should enable Vela to complete the additional investment of £150,000 in Portr, the airline passenger facilitation and baggage transport service, taking its stake to 4.27%.

Collagen Solutions (COS) is raising up to £8m from a placing and one-for-five open offer at 5p a share and this will be topped up with a £4m bond issue to Norgine Ventures, which has a coupon of 10% and 6.77 million warrants exercisable at 5.911p each. The cash will finance the expansion of the medical collagen business, commercial medical device products and launch ChondroMimetic, which is a collagen-based implant to treat small cartilage and bone defects, later this year.

Online gaming business generator Veltyco Group (VLTY) says that its 2016 figures will be significantly better than expected. An EBITDA of more than €2m, up from the initial forecast of €1.4m, on revenues of more than €5.7m, ahead of a forecast of €4.9m, is anticipated.

Evgen Pharma (EVG) has signed a services agreement with APTrans, a Cheshire-based consortium of drug developers that can provide technical expertise, for the development of SFX-01. A US patent has been granted covering the manufacturing process for SFX-01. The patent lasts until 2033. Further patents are expected to be awarded around the world.

Ascent Resources (AST) raised £3m at 1.85p a share in its latest fundraising via PrimaryBid.com. The cash will be spent on developing the Petisovci gas project in Slovenia.

Self-storage operator Lok’nStore (LOK) says that self-storage sales were 3.9% higher, thanks to higher occupancy, and document storage sales 8.8% ahead in the first half. There is a pipeline of two owned and two managed stores, which will add 14% to capacity. NAV is expected to be 404p a share at the end of July 2017.

PowerHouse Energy Group (PHE) has raised £2.5m at 0.8p a share on the back of last week’s deal with Peel. Hillgrove will receive £2m as part-payment for its loan with £1.4m converted into shares at 0.5p each. A G3-UHt waste to energy unit is being shipped from Australia and should reach the UK in March.

Allergy Therapeutics (AGY) is starting a phase I clinical study for safety and tolerability of Acarovac MPL as a house dust mite allergy vaccine. The trial will be in Spain, covering 32 patients and lasting one year. The global market could be worth $1.5bn a year.

Patient monitoring equipment developer LiDCO Group (LID) says that its 2016-17 revenues will be slightly lower than forecast but it will make a small profit. The loss of a US customer held back growth with revenues 8% ahead at £8.2m, although revenues from group products were 14% higher this was partly offset by lower sales of third party products.

EP Minerals has terminated its lease over the County Line Diatomite project, so Sunrise Resources (SRES) will need to find an alternative method of commercialising the potential project.

Keras Resources (KRS) says that there is a JORC-based inferred mineral resource of 36,000 ounces of gold at a grade of 6.1g/t for the Copenhagen deposit. This means that the Warrawoona gold project has a JORC mineral resource of 410,000 ounces of gold at a grade of 2.2g/t. The focus will be the higher grade Copenhagen deposit, which has more potential.

Mariana Resources (MARL) has completed three of seven planned drill holes at the Ergama project in Turkey and two of these have found large but low grade deposits.

Executive chairman John Hawkins has been given the push by Pebble Beach Systems (PEB) as part of the closure of the group’s head office following the disposal of the Vislink broadcast equipment business. Hawkins received £260,000 a year as chief executive and £100,000 a year as chairman and his contract stipulates 12 months notice. John Varney becomes non-executive chairman. The bank apparently remains supportive and the 2016 figures will be published on 31 March.

Cloud-based telecoms software supplier CloudCall Group (CALL) says that customer relationship management software provider and corporate partner Bullhorn is deploying CloudCall’s software with its US staff. This will provide a reference for potential US customers of a combined software package. Full year figures will be published on 28 March and these will be in line with expectations.

MAIN MARKET

Simian Global (SMG) has signed a non-binding letter of intent to buy BVI-incorporated media and advertising business GVC Holdings Ltd. Standard list shell Simian Global floated on 10 January when it raised £769,500 at 15p a share. This valued the company, which was seeking a technology, media and telecoms sector acquisition, at £935,000. Trading in the shares was suspended at 17.5p.

Avation (AVAP) is trading at a discount of around one-fifth to its NAV of 249p a share at the end of 2016. In the six months to December 2016, the aircraft leasing company’s revenues were 43% ahead at $45.1m and pre-tax profit 50% higher at $8.4m. Bid discussions for 22 ATR 72 aircraft continue but management wants a significant premium to the NAV.

PRE-IPO / OTHER TRADING FACILITIES

Former AIM-quoted Clinical Computing, which is currently traded on Britdaq,has initiated a strategic review and this could lead to the sale of the healthcare IT company. In the year to March 2016, revenues fell from £1.67m to £1.5m but a loss of £204,000 was turned into a profit of £23,000. There is £825,000 in the bank and net assets of £654,000, which is more than its market capitalisation on Britdaq.

Andrew Hore

 

Quoted Micro 17 October 2016

ISDX

St Mark Homes (SMAP) has launched a one-for-three open offer at 105p a share, which could raise £1.3m. The open offer price is at a large discount to NAV of 137p a share. St Mark has said that the main constraint on growth is access to capital. The money is earmarked for two new developments in south west London. Longer-term, St Mark may move to AIM.

Energy efficiency products supplier Sandal (SAND) says that its MiHome IOT home automation range has been integrated with the Amazon Echo product that is being launched in the UK. Amazon Echo is a voice activated smart home control product.

Valiant Investments (VALP) has raised £51,500 at 0.1p a share. Valiant owns 84.7% of Flamethrower has acquired more apps for its range. Navigation app Where am I at? has been acquired for $20,000 and Conversation Shaker, which provides questions and icebreakers, bought for $3,000. Additional casino games have been launched.

Former AIM company Doriemus (DOR) is planning a standard listing. The process for the listing will start once the open offer is completed. The oil and gas company says that investors, including broker Optiva Securities, have agreed to subscribe for all the open offer shares at the open offer price of 0.035p a share if they are not taken up be existing shareholders. Doriemus hopes to raise up to £865,000 via the open offer, which closes on 18 October. The bid offer spread is currently 0.042p/0.05p.

AIM

Latest AIM Journal available here.

Midatech Pharma (MTPH) has raised £16m at 110p a share and an open offer at the same share price could raise up to £2m more. Midatech was floated less than two years ago at 267p a share, when it raised £32m. Midatech joined Nasdaq at the end of 2015. There was an £8m cash outflow from operations in the first half of 2016. The new cash will go towards advancing its development pipeline and investing in manufacturing in Bilbao and its sales resources. New candidates for the pipeline have been identified. The focus will be on Q-Octreotide (MTD201), an existing treatment for metastatic cancer tumours which is being developed into a sustained release product, and MTX110/MTX111, which are potential treatments for a rare brain tumour disease suffered by children called diffuse intrinsic pontine glioma.

Constellation Software Inc has announced a final increased offer of 121p a share for Bond International Software (BDI). The alternative is the liquidation of Bond which may not generate as high a figure as the Constellation bid. The original bid was 105p a share.

Vertu Motors (VTU) continues to drive forward Revenues were 18% higher at £1.45bn, while pre-tax profit was 15% ahead at £19.5m. Acquisitions fuelled the growth in the period but even after spending money on new sites there was net cash of £12.9m. The interim dividend is 11% higher at 0.5p a share. Used cars and service operations were particularly strong in the period. The new car market was weaker than the year before but it remains relatively strong. Mercedes Benz and Toyota have been added to the distributorships while most of the Fiat operations have been sold or closed.

Vast Resources (VAST) has announced that the maiden JORC resource estimate for the Nkombwa Hill phosphate and rare earths project in Zambia. The total JORC compliant mineral resource estimate stands at 21.8mt at a grade of 7.06% P2O5 and 1.17% total rare earth oxides (TREO) at a 3% P2O5 cut-off grade and 2.78mt at a grade of 2.76% TREO and 6.43% P2O5 at a 1% TREO cut-off grade. This represents 5% of the potential area. Kilmire International has eared a 50.4% stake in the project, with Vast owning the rest, and plans a further investment of $1m. Kilmire wants to reach a 65% stake in the project. Northland raised $5m for Vast in a convertible loan note issue that is being taken up over two years by Bracknor Fund Ltd. This cash will help fund other projects.

AstraZeneca has decided to end the phase IIa trial for respiratory disease treatment AZD9412 because a low number of the patients have developed severe exacerbations, although the trial has show that the treatment is safe. AstraZeneca will reassess how to progress with the potential drug that is licenced from Synairgen (SNG). Once the results have been reassessed a new trial can be designed so this is a delay but not a failure.

Digital TV software and services provider Mirada (MIRA) says that the roll-out for izzi Telecom/Televisa in Mexico is going to plan since it started in July and this means that Mirada should meet 2016-17 expectations. There are a total of 4.2 million subscribers that could use the service and this is likely to be the largest deployment of Mirada’s technology. Allenby expects a smaller loss this year than last year and a profit in 2017-18.

Patient monitoring equipment developer Lidco (LID) grew revenues from £3.6m to £3.77m and the loss was reduced. Sales have restarted in Japan and there was growth in the US. There was a cash inflow and cash was £2.09m at the end of July 2016. A full year profit of £200,000 is forecast.

MAIN MARKET

Engineer and environmental consultancy Waterman Group (WTM) reported a 50% increase in full year pre-tax profit to £3.6m on the back of an improvement in revenues from £83.9m to £91.3m. Net cash was £5.5m at the end of June 2016. The dividend has also been increased by 50% to 3p a share – 2.5 times covered by earnings. Over the next three years management wants to increase the underlying operating margin towards 6%, from the current level of 4%. Recent appointments include the residential development of the former Thames Television studios at Teddington. The order book is worth £130m, which is similar to the level at June 2015.

Copper concentrate trader and mine developer Bluebird Merchant Ventures Ltd (BMV) has received an offer of new capital, which would lead to the acquisition of a controlling interest. The proposed share issue would be at a premium to the market price – 1.7p at the time. The share price has risen to 2.375p (2.25p/2.5p), although it has halved since trading started six months ago. There is no mention of whether existing shareholders will be offered a chance to have their shares acquired by the investor.

Andrew Hore

 

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