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Sanderson Group plc SND Half year trading results to the end of March, are ahead of management’s expectations with revenue growing to approximately £17.0 million from last years £14.6 million and operating profit increasing by over 30% to £2.8 million from last years £2.1 million. Digital Retail has continued to perform strongly during the six months and achieved further double-digit revenue and operating profit growth.in The Manufacturing business sales orders grew by over 10%. The Board is confident that it will be able to maintain its progressive dividend policy.
System 1 Group plc Sys1 updates that its Consultancy business stabilised after a difficult 2017/18. Gross profit was down 1% for the year as a whole at £22m but Being 4% ahead in the second half, allowed it to generate underlying pre-tax profits for the year as a whole.
Serabi Gold plc SRB Reports another excellent quarter with a strong start made to 2019 and over 10,000 ounces of gold produced in the first quarter, keeping up the momentum from the end of 2018 and the second successive quarter with production above 10,000 ounces for the first time. Guidance for 2019 is maintained at production in the range of 40,000-44,000 ounces representing a significant improvement on 2018’s production of 37,108 ounces.
Filta Group Holdings plc FLTA continued to experience strong organic growth for the year to the end of December whilst, at the same time completing two strategically significant acquisitions, moved Filta into a market-leading position. Like for like revenue grew by 23% and like for like EBITDA by 25%. The proposed final dividend has been increased to 0.92p. per share on top of the interim dividend of 0.72p making a total increase for the year of 26%.
IG Design Group plc IGR The strong trading performance continued in the final quarter both delivering revenue and profit growth across all regions in the year to the 31st March.. The Board now anticipates that the financial performance of the Group will be be up significantly up year on year. The progressive dividend policy is expected to be continued earnings pay-out ratio is also expected to be increasesd at the full year.
Sanderson Group plc SND Preliminary trading results for the year ended 30 September 2018 are significantly ahead of the prior year and also ahead of market expectations. Revenue has increased by 49% to £32.05 million and operating profit by 33%. The recommended Final Dividend and Full Year Dividend are both to be increased by 13% to 1.75 pence per share and 3.00 pence per share respectively. The company has a good level of confidence that further progress will be made in 2019 and results will be at least in line with expectations..
Cake Box Holdings CBOX Announces a strong performance since its admission to Aim in June. Revenue for the six months to the end of September rose by 44% but profit before tax fell by 7% and earnings per share by 11% after allowing for Aim listing costs of £599,000. Adjusting for these left the respective figures showing rises of 34% and 36% respectively. The interim dividend is increased by 17%. The Cake Box brand is described as continuing to go from strength to strength and the Board is expecting another successful year of growth.
Fusion Antibodies FAB admits that the first six months of the current financial year have been challenging due to increasing competition and consequential pricing pressures. Revenue fell by well over 50% and the loss for the period increased to £742k from £166k in the first half of last year. However a strong recovery in order levels has been seen in October and November and a resumption in growth is expected.
SysGroup plc SYS claims to have made steady progress during the first half year to the end of September. Revenue rose by 47.3% and adjusted EBITDA by by 300%. The company moved from a small loss into a slightly larger profit and adjust basic earnings per share rose from 0.2p to 1.1p per share.Investment in the business has continued and this has led to an increase in the proportion of recurring revenue.
HSBC has had to cave in and pay yet another huge penalty to fend off claims in the US of widespread fraud and corruption. It took the benighted bank some ten years until 1916 before it had the grace to cough up and agree to pay compensation to US customers to whom it brought financial misery and in many cases deliberately made homeless. The bank has now been forced to pay a huge $765 million settlement to the US Department of Justice but still will not admit to any wrongdoing, which raises the rather major question, as to why in that case it has agreed to make the payment. Banks are not particularly noted for their generosity.
The bank paid up rather than try to defend itself against allegations that it misled investors, misrepresented the quality of securities, hurt people and abused their trust, caused major losses by investors and contributed to a crisis of foreclosures. The amount involved at $24bn was not chicken feed but this is the worlds bank so nobody has actually been sent to prison. The bank claims that it has put things right by strengthening its internal controls but in the same breath it admits that it is still completing the turn-around of its US operations. Twelve years after the event and it has still not got its act together!
Page Group plc PAGE saw third quarter gross profit rise by 19.7%, the highest quarterly growth rate since 2011. The increase ranged from virtually nil (0.8%) in the UK, to 30% in the Americas and 27.7% in Asia Pacific. operating profit for 2018 is expected to be marginally ahead of consensus
Sanderson Group plc SND updates that trading results for the year to the end of September are significantly ahead of 2017, but also slightly ahead of current market expectations. Group revenue rose by nearly 50% and operating profit by 30% to over £5 million compared to 2017’s: £3.90 million. Sales orders in the second half of the year were strong and on a like-for-like basis, the order book at he year end was up by over 9%.
Iofina plc IOF produced the largest quarterly total of crystalline iodine in its history with a total of 172.3 metric tonnes for the third quarter, an increase of 37.8% over the third quarter of 2017. The company expects the positive momentum which it is currently experiencing will significantly increase Group revenue and profits from those attained in the first half.”
Sativa Investments (SATI) has made two investments in the past week. A C$200,000 investment in Rapid Dose Therapeutics Inc has been made prior to a flotation. The company’s QuickStrip fast-dissolving strip technology can be used to deliver medicinal cannabis. The other investment is in Veritas Pharma. A further C$200,000 is being invested in Veritas, which develops and commercialises medicinal cannabis treatments for chronic pain and palliative care.
Gunsynd (GUN) says that Danish software business FastBase Inc is delaying its flotation. An AIM quotation was originally planned but it may come to the standard list. There may also be a corporate transaction. Gunsynd has a 10% stake in Sunshine Minerals, which has announced that the authorities in the Solomon Islands intends to issue a prospecting licence for its nickel project as long as it gains right of access with land owners.
Wheelsure Holdings (WHLP) reported halved revenues in the six months to February 2018. Orders for the company’s rail systems and technology have been disappointing due to tight budgets and admin delays. The interim revenues fell from £104,000 to £46,000.
Walls and Futures REIT (WAFR) raised £80,000 from an open offer at 94p a share.
Capital for Colleagues (CFCP) had a NAV of 41.5p a share at the end of February 2018, down from 43.5p a share one year earlier. The employee-owned business investor invested £324,000 in the latest six month period. There is £789,000 in the bank.
Stride Gaming (STR) intends to get rid of its poorly performing social gaming business and concentrate on growing its online gaming operations internationally. Licences are being applied for and Italy should be up and running in the near future. As expected increased regulation and tax are holding back profit. Revenues should grow this year but pre-tax profit is expected to decline from £18.9m to £14.2m and be flat next year.
Watkin Jones (WJG) increased its revenues by 18% to £158.3m in the first half. Pre-tax profit was 12% ahead at £23.6m. Student accommodation developments remain the core but build to let developments will become more important over the coming years. There is even potential for a separate operation focused on build to let. Full year pre-tax profit is expected to be £48.1m.
Sanderson (SND) put in a strong first half performance. The enterprise software provider had an initial contribution from Anisa but even so the like-for-like profit was higher even though like-for-like revenues only edged up. The retail business was the main driver of profit growth and the improved order book, which increased from £2.78m to £8.61m. The like-for-like order book was 16% higher. The interim dividend was increased by 14% to 1.25p a share. Earnings per share rose by 44% to 2.3p a share, helped by a lower tax charge.
Oxford Metrics (OMG) has completed the disposal of its Yotta Surveying business to Ginger Group. The sale of the highways surveying business will generate £1.3m in cash. Oxford Metrics still owns the Yotta software.
GetBusy (GETB) has made a strong start to 2018 with revenues 17% ahead in the first four months of the year. Stockdale expects the software company to increase its profit from £1m to £1.6m this year.
River and Mercantile has sold its shares in InterQuest (ITQ) and Chisbridge has increased its stake to 51.4%. This comes at a time when InterQuest is seeking to cancel the AIM quotation and investors are being offered 24p a share.
Best of the Best (BOTB) has received the full £4.5m VAT claim from the HMRC. There will be fees and costs to offset against this. On the negative side, HMRC says that the company owes retrospective remote gaming duty for a period of four years.
Frontier Smart Technologies (FST) says tough trading in the second quarter will hit the full year outcome. Expectations have been downgraded to revenues of £34.9m and EBITDA of £800,000. There will be an EBITDA loss of £1.5m in the first half. Excess stock levels hit orders for the digital radio division. Smart audio revenues are expected to grow slower than envisaged originally because of competition in the market. Development spending is being reduced.
Magnolia Petroleum (MAGP) wants to cancel its AIM quotation. The oil and gas producer estimates that it will save £100,000 a year by leaving AIM. The strategy is to sell assets in order to reduce debt.
Clear Leisure (CLP) is raising £600,000 at 0.95p a share. The cash will be invested in the bitcoin data mining business and fund continued litigation.
Trading in the shares of Path Investments (PATH) remains suspended and the AIM flotation continues to be delayed. The acquisition of a 50% stake in an onshore gas field in Germany is progressing. The 2017 annual report should be published in June.
Fandango Holdings (FHP) has secured two potential factoring and financial services acquisitions. The standard list shell would issue 908.4 million shares for the acquisition. Trading in the shares has been suspended.
Predator Oil and Gas (PRD) joined the standard list on 24 May. The share price edged up from 2.8p to 2.88p. The flotation raised £1.3m to finance the plan to acquire oil and gas assets in Trinidad and Tobago and Ireland.
Bisichi Mining (BISI) has acquired five shops in west Ealing (via a joint venture) for £5.6m. Bisichi and its main shareholder London and Associated Property will each own 45% with the other 10% owned by Metroprop Real Estate. The annual rental income is £140,000 and there is planning consent for 20 flats.
Life sciences company Bioquell (BQE) has sold its defence business for an initial £400,000. Up to £600,000 more could become due depending on winning a particular contract in the next 12 months. This business is lumpy and it made a small loss last year.
WideCells (WDC) is still finalising its 2017 accounts. The stem cell services provider is offering the chance for small investors to invest up to £450,000, via a bookbuild using the Teathers app and that was due to close on 21 May but it will be extended until the results are published. Trading in the shares remains suspended.
Forbes Ventures (FOR) has sold its stake in KCR Residential REIT (KCR) for £145,000. The remaining investment is in challenger bank Civilised Investments Ltd. Nigel Quinton, who has run two building societies, has been appointed as finance director of Forbes. Igor Zjali has become a non-executive director. The investment strategy covers disruptive technology in the property and fintech sectors.
KR1 (KR1) has been raising cash from partially disposing of token holdings. Cash has been generated from sales of tokens issued by six projects and this will be available for re-investment. KR1 has already acquired 30,587 tokens in the Waves project at $6.41 each.
Angelfish Investments (ANGP) says that there has been a further delay in its investee company Rapid Nutrition’s plans to gain a quotation in London. Rapid, which is already quoted on the SIX Swiss Exchange, has developed a nutraceutical product range. One of the terms of a £150,000 loan to Rapid was that it should be admitted to the London market by the end of February, but this date was extended to the end of April and has been extended again to the end of July. The principal and interest, up until the end of February, will convert into Rapid shares. Interest has been payable in cash since the end of February.
EPE Special Opportunities (ESO) reported a 35.6% decrease in NAV to 234.4p a share at the end of January 2018. That was mainly down to the poor performance of fully listed LED lighting company Luceco (LUCE) after sales growth did not turn into higher profit. EPE is considering exercising the option to redeem up to 50% of the outstanding unsecured loan notes. Redeeming £4m of loan notes would save £300,000 in interest. There is £28m in the bank.
Middle East-focused investment company Indigo Holdings (INGO) has lost €165,300 on an Iran-based car ride-sharing app. This will be mainly offset by a book gain of around €160,000 on its investment in Sheypoor following another fundraising round.
NQ Minerals (NQMI) has started to refurbish the Hellyer flotation plant in Tasmania. The mill should be commissioned in the third quarter of 2018.
First Sentinel (FSBN) has invested in AIM-quoted Amur Minerals and unquoted Titan FM Ltd in April. An investment of $250,000 has been made in the form of a contribution to a $10m loan facility made available to Amur. Titan FM is an acquisition vehicle in the facilities management sector with a focus on areas covered by strict regulation. The £50,000 pre-IPO investment helped to finance the first acquisition of a provider of air conditioning and refrigeration services. Two more acquisitions are planned this year as is a quotation on NEX. The latest tranche of First Sentinel bonds has raised a further £1m.
Valiant Investments (VALP) reported a flat full year loss of £216,000 and this would have been higher if there had not been a swing from a £3,000 loss on listed investment movements to a £25,000 gain. Valiant has invested some of its cash in five AIM-quoted, dividend paying companies. Valiant had a NAV of £197,000.
Sandal (SAND) has appointed David Munting as finance director and Richard Green as a non-executive.
Minds + Machines (MMX) swung from loss to profit in 2017 and it is acquiring four top level domains. Minds + Machines is paying $10m in cash and $31m in shares in two tranches for the membership interests of Florida-based ICM Registry, which owns .xxx, .sex, .adult and .porn. In 2017, revenues were $7.27m (78% recurring) and net income was $3.5m. The recurring nature of the revenues and the reduced dependence on China should help the group to start paying dividends in the next couple of years. Multinational brands buy related domain names with these suffixes so that nobody else can. This helps to boost recurring revenues. Not all of the other purchasers are sex-related, either. The main uncertainty concerns whether the group will get a lower rating because of the association with sex-related businesses.
Sanderson Group (SND) says that its interim results are slightly ahead of expectations and the positive momentum is continuing. The enterprise software supplier’s operating profit has increased from £1.55m to £2m. Two-thirds of the improvement has come from recent acquisition Anisa and the rest is organic.
DX (Group) (DX.) has raised £4.76m at 8.5p a share, which is much higher than the indicated minimum price of 7.41p that is being used to capitalise the company’s loan notes. These additional shares will heavily dilute existing shareholders. The cash will be used to restructure the parcel delivery networks, open new depots and finance IT investment.
Wynnstay Group (WYN) is acquiring eight country stores previously operated by Countrywide Farmers, which has gone into administration. Five of the stores take Wynnstay into Devon and Cornwall. The stores have annual sales of £16.4m.
Berkeley Energia (BKY) has announced plans to move to the standard list and the Spanish Stock Exchanges in Madrid, Barcelona, Valencia and Bilbao. The admissions should happen by the end of May. No money will be raised because the cash injected by the Oman sovereign wealth fund covers the upfront capital costs of developing the Salamanca project in Spain.
A combination of lower costs and higher iodine prices meant that Iofina (IOF) reduced its underlying loss from $5.4m to $3.4m in 2017. There was also a $5.3m impairment charge. There was a cash inflow before working capital movements. The new IO#7 plant started up in February and there could be another plant in the next year. Iofina is on course to be profitable in 2019.
Sinclair Pharma (SPH) has secured a €23m loan facility. This will replace bank debt and help to finance the aesthetics company’s new strategy in the US following the decision to terminate the Silhouette InstaLift distribution agreement with Thermi when reorder rates were disappointing. Negotiations are ongoing with potential distribution partners in the US. There was growth in other markets, including Brazil, and the 2017 loss was lower.
Pelatro (PTRO) provides precision marketing services to telecoms companies that helps them to retain subscribers and generate more income from each of them. Maiden results for Pelatro show a jump in underlying profit to $1.8m but the trade receivables are the most significant number in the accounts. Despite the profit there was a small cash outflow after tax payments. That is because trade receivables were $1.78m and $756,000 of that figure is for more than 121 days. That is because the company used extended payment terms to help to attract a customer. There is $3.1m in the bank so Pelatro has the cash to finance additional working capital for that and future deals. It is best to keep an eye on the trade receivables.
Rose Petroleum (ROSE) has raised £1m at 3.25p a share. The cash will be used to finance progress with the Paradox project towards being drill-ready. There are also other partnership and investment opportunities in the region.
Gloo Networks (GLOO) cannot find a suitable acquisition and it is winding itself up. Shareholders should receive at least 47p a share. The original placing price was 120p, so three-fifths of the cash has gone in less than three years without doing a deal.
Braime (TF and JH) (BMTO) reported a jump in pre-tax profit from £1.3m to £2.2m in 2017. The total dividend has been increased from 9.3p a share to 10.2p a share. Pressings profit was flat and the improvement came from the materials handling division.
Safestyle UK (SFE) says Steve Bermingham will retire as chief executive at the end of this year and he is being replaced by Mike Gallacher, who until recently ran First Milk, the farmer-owned milk business, which he restructured.
Trading in Green and Smart Holdings (GSH) shares was suspended because it did not publish its 2016-17 accounts by the end of March. The audit was expected to be completed by the end of April, but it is still going on and the accounts are not expected before June. Discussions continue with a potential investor.
Stem cell services provider WideCells Group (WDC) is running out of cash and has not been able to publish its 2017 accounts so trading in the shares has been suspended. Directors have loaned the company a further £115,000, on top of a previous £100,000. At the end of June 2017, there was cash of £869,000 and debt of £634,000. That was before any of the director loans. It appears that management has taken too long to sort out the funding it requires and the potential share issue, if it is arranged, could be significantly dilutive.
Nanoco (NANO) has launched Nanoco 2D Materials Ltd in order to develop nanomaterials. The University of Manchester has invested £400,000 via a convertible.
Symphony International Holdings (SIHL) is paying an ordinary and special dividend of 12 cents in total. That will cost $71.5m. The Asian healthcare and hospitality businesses investor has sold investments and realised gains have helped to fund the payment.
St Ives (SIV) has completely exited book printing with the sale of Clays for £20m. The pension liabilities will stay with St Ives and it will contribute £2.5m to the pension fund. Net debt was £42.2m on 2 February 2018.
Trading in Sealand Capital (SCGL) shares has been suspended because it could not publish its 2017 accounts by the end of April.
Small Cap Awards (14 June, Montcalm Hotel, Marble Arch, London) Nominees
IPO of the Year
Alpha FX Group
Keystone Law Group PLC
K3 Capital Group
Rainbow Rare Earths Ltd
Company of the Year
Nostra Terra Oil and Gas Company
ZOO Digital Group
NEX Exchange Company of the Year
Field Systems Designs
National Milk Records
Walls & Futures
Executive Director of the Year
Zillah Byng-Thorne (CEO) and Penny Ladkin-Brand (CFO) – Future plc
Dr. Stuart Green, CEO – Zoo Digital Group PLC
Chris Gurry, Group Managing Director – CML MicroSystems PLC
Tom Ilube, CEO – Crossword Cybersecurity PLC
Dr Markku Jalkanen, CEO – Faron Pharmaceuticals
Bobby Kalar, CEO – Yu Group PLC
Dr. James Millen, CEO – Physiomics PLC
Ian Simm, CEO – Impax Asset Management Group PLC
Frazer Thompson, CEO – Chapel Down Group PLC
Andrew Wass, CEO – Gear4Music Holdings PLC
Impact Company of the Year Sponsored by Impact Investment Network
Walls & Future
Fintech Company of the Year
Transaction of the Year
Proactis Holdings PLC – Acquisition of Perfect Commerce
Work Group PLC / Gordon Dadds Group PLC – Reverse takeover
Atlantis Resources Limited – Uksmouth power stations deal (SUSPENDED)
Frontier IP Group PLC – Transactions FairFX Group PLC – Acquisition of CardOne
7digital Group PLC – Acquisition of 24-7
Impax Asset Management Group PLC – Acquisition of Pax World Management LLC
Analyst of the Year
Vadim Alexandre, Head of Research – Northland Capital Partners
Kevin Ashton, TMT Analyst – Cantor Fitzgerald
Eric Burns, Deputy Head of Institutional Research – WH Ireland Limited
David Johnson, Research Director – Allenby Capital Limited
Rob Sanders, Head of Growth Companies Research – Stockdale Securities Limited
Simon Strong, Head of Research Growth Companies – Cenkos Securities PLC
Journalist of the Year
Smit Berry – Small Company Sharewatch
Joanne Hart – Midas
Jamie Nimmo – Mail on Sunday
Paul Scott – Stockopedia
Mark Shapland – Evening Standard
Merryn Somerset Webb – Financial Times
Simon Thompson – Investors Chronicle
Fund Manager of the Year
Daniel Nickols – Old Mutual UK Smaller Companies
James Thorne – Threadneedle UK Smaller Companies
Nick Williamson – Old Mutual UK Smaller Companies
James Zimmerman – Jupiter UK Smaller Companies
Microcap Fund Manager of the Year
Guy Feld – Cannaccord (Hargreave Hale Limited)
David Horner – Chelverton Small Companies Dividend Trust PLC
Judith MacKenzie – Downing LLP
Katie Potts – Herald Investment Management
Gervais Williams – Miton Group PLC
Lifetime Achievement Award To be announced on the evening
Special Services to Small Caps To be announced on the evening.
ConvaTec Geoup CTE admits to a disappointing performance in 2017 due to unspecified headwinds and significant challenges, the nature of which are not disclosed..Supply constraints from which it suffered during the year will continue to have an impact in 2018, especially in the first half due to back order fulfillment and lost orders. Revenue for the full year rose by 4.5% and reported operating profit by 60.9%
RELX PLC REL is increasing its fully year dividend for 2017 by 10% after reporting another year of underlying growth in revenue, operating profit and earnings. Adjusted operating profit grew by 6%, underlying revenue by 4%, and adjusted earnings per share on a constant currency basis, by 7%. Further growth is forecast for 2018.
Earthport plc EPO updates that revenue rose by 8% for the 6 months to the 31st December but adjusted gross margins fell by 9% and administrative expenses rose by 7%. The adjusted EBITDA loss more or less doubled to £3.2m. Core services remain strong despite first half challenges and the new business pipeline is also strong but cash flow break even point is not expected to be reached until 2019.
Venn Life Sciences VENN Using the headwind from project deferrals in the first half of 2017as an excuse the board believes that the small fall in revenue from £18.2m to £17.8m, an improved EBITDA performance and a closing cash position down by nearly two thirds, reflects solid progress
Sanderson Group plc SND will report at todays AGM that following the acquisition of Anisa Group in November, total group revenues for the four months to the end of January are approximately one third ahead of the same period last year. On a like for like basis and excluding Anisa, Sanderson revenues are 5% ahead and operating profit some 10% ahead.
Sanderson Group SND claims strong trading momentum and further profitable growth in the year to the 30th September so despite only tiny rises in revenue and operating profit, it is increasing its final dividend by 11% as part of its progressive dividend policy. It is however carefully monitoring market conditions and then comes out with the rather strange statement that it has not “yet” detected any major loss of confidence from existing or prospective customers. So a major loss of confidence appears to be expected, the only question being the time of its arrival.
Pets At Home PETS produced strong growth in the veterinary business with income up 16.1% for the half year to the 12th October and omnichannel also put in a strong performance with with revenue up 6.24%. is being held at last years level. Despite that, statutory profit before tax fell by 11.3% and the dividend. The company claims that it is satisfied that it s taking the right decisions. The CEO is departing, as is a non executive director.
Greencore Group GNC has been substantially transformed during the year to the 29th October and it admits that the transformation has not been without its challenges, although it believes that it is now set up for further progress. Group revenue rose by 56% but profit before tax dived by 74.3% and basic earnings per share by 80%. On an adjusted basis profit before tax was up by 35.9% and earnings per share down by 3.8%. The dividend remains unchanged.
Cranswick CNW is increasing its interim dividend by 15.3% for the half year to the 30th September, which also saw record investment of 29m. to increase capacity, capability and efficiency. Revenue rosen23% or 18% on a like for like basis, whilst profit before tax rose by 17.2% and earnings per share by 20.1%. Net debt rose strongly from 2.9m. to 16.7m.
Chapel Down Group (CDGP) says that the 2017 harvest was second best in the company’s history. There was a 10% volume increase on the previous year. The quality was also good. There had been fears for the harvest because of the frost in April but Chapel Down sources from a wide range of vineyards. Chapel Down has completed the acquisition of the 1.6 acre site in Ashford where the Curious Brewery will be developed.
Capital for Colleagues (CFCP) is setting up a joint venture to focus on consultancy and advisory operations so that the core business is purely involved in investment in employee owned businesses. Capital for Colleagues will own 34% of Castlefield Corporate Advisory Partners, with 51% owned by Castlefield Partners and the rest by executives of the joint venture.
Supported housing developer Walls and Futures REIT (WAFR) has delivered its first project and has a pipeline of other projects. The NAV is 94p a share. In the six months to September 2017, there was a £203,000 uplift in property values and that is why there was an interim profit of £127,000. There is £237,000 in the bank.
Mechanical and engineering installation work provider Field Systems Designs Holdings (FSD) reported a 19% increase in full year revenues to £17.2m. The main growth came from the water and sewerage operations and the AMP6 regulatory period is just getting going. Pre-tax profit more than doubled from £308,000 to £672,000.
South Africa-focused investment company Inqo Investments Ltd (INQO) still has R756,000 in the bank following further investments. Kuzuko Lodge continues to lose money but its occupancy and room rates are improving. Investee company Bee Sweet Honey harvest 133 metric tonnes of honey in May and this has generated revenues for Inqo.
Ganapati (GANP) reported a reduced interim loss of £4.54m, down from £8.75m. The online casino software and apps supplier increased revenues from £1.34m to £2.19m. A mobile operating system update has held back revenue generation from the company’s apps.
IMC Exploration (IMCP) has raised £75,000 at 1p a share and issued warrants that could raise a further £150,000 at 2p each. The cash will finance a feasibility study on the licence in Avoca in County Wicklow.
MiLOC Group Ltd (ML.P) has raised £540,000 at 28.5p a share and issued further shares as payments to consultants at 30p a share.
Sanderson Group (SND) expects its full year revenues to be slightly higher at £21.5m but underlying operating profit is anticipated to rise from £3.69m to £3.9m. That excludes £500,000 of reorganisation and acquisition costs. The digital retail software divisions continues to be the main growth area. The order book of £5.8m at the end of September is much higher than the same time one year earlier. It does include a large order that will be delivered over two financial years. There is more than £6m in the bank.
At last week’s general meeting of Stratex International (STI) the requisitioners were successful with their first and fifth resolutions but not the second. The third and fourth resolutions were conditional on the passing of the first two so they did not go to a vote. Marcus Engelbrecht has left the board and the acquisition of Crusader Resources appears unlikely to go ahead. The requisitioners want to inject joint venture Thani Stratex into the quoted company.
Diversified Gas and Oil (DGOC) completed the acquisition of the Titan oil and gas assets at the end of September. Operating costs have been reduced by 8% to $7.14/barrel of oil equivalent since the first half of 2017, which has helped margins to improve. Trading is in line with expectations.
Billing and charging software provider Cerillion (CER) says that its full year revenues increased 8% to £16.2m. Mobile telecoms operators continue to dominate the business but the customer base is set to broaden.
Sapphire producer Richland Resources (RLD) produced 1.06 million carats from its Capricorn mine in the third quarter of 2017 but this was lower than the 1.2 million carats that was expected because of mine disruption and rehabilitation. Production and operating costs were $0.75/carat. The next sapphire sales are this month. Illegally mined sapphires are holding back prices so only $245,000 was generated from sales in the third quarter as Richland held on to sapphires in order to sell them in the fourth quarter.
Redx Pharma (REDX) has come out of administration. The board will be writing to shareholders laying out its strategy and the suspension of trading in Redx shares could be lifted later this year.
Versarien (VRS) is trying to raise £1.2m via institutions and PrimaryBid.com at 18p a share. Back in March, £1.5m was raised at 15p a share in the same way. The advanced materials company will use the cash to buy capital equipment in order to fulfil the requirements for graphene-related collaborations. There are negotiations with two of the largest consumer goods companies in the world. An order is expected shortly and there are many other discussions ongoing. The Total Carbide business is winning aerospace work to offset the shortfall in demand from the oil and gas sector.
Proxama (PROX) has sold its loss-making digital payments division in order to concentrate on its location sciences technology business. The deal will raise £1m with potential deferred consideration of up to £1m over 18 months. The company will change its name to Location Sciences.
Starcom (STAR) has raised £475,000 at 1.3p a share. The cash will provide working capital for recently announced large orders and to repay $100,000 owed to YA II and $115,000 owed to other creditors.
INEOS has acquired an interest in shale gas licences where Egdon Resources (EDR) is also involved. Egdon plans to increase its onshore UK production this year. INEOS has taken on the obligations of Total to carry Egdon in the PEDL 139 and 140 areas. Egdon owns 14.5% of each of these licences. Egdon also has a £4.85m carry on PEDL209, where Egdon has a 36% interest.
Pakistan-focused coal mine developer Oracle Power (ORCP) says a memorandum of understanding should be signed this month. Oracle will retain a 12.1% stake in the block VI project. Sichuan Provincial Investment Group will take a 78% interest in the project and the other 9.9% will be owned by PowerChina International Group. The gross cost of the project is estimated to be $1.6bn and the debt/equity ratio will be 75/25.
Gordon Dadds (GOR) has made its first acquisition since reversing into Work Group. The lawyer will pay £4m over a five year period for CW Energy. There could be additional payments dependent on performance. CWE is a corporate tax adviser and prior to distributions to partners it made EBITDA of £1.3m last year.
WideCells Group (WDC) has signed a five–year agreement with White Apex General Trading, which will provide the companies stem cell services. WideCells immediately receives £255,000. The agreement covers the stem cell insurance product, stem cell storage and the educational platform Wideacademy. A further £1.5m could be payable if the Wideacademy platform is adapted for Middle East, North Africa and Asia. There could be £250,000 of this paid by the end of this year.
OTHER MARKETS / UNQUOTED
Fashion On Screen continues to progress towards a floatation on Nasdaq First North in the first quarter of next year. It is also raising money for its first film, Will, which is based on the life of William Shakespeare, via the SyndicateRoom crowdfunding platform. There are at least two other films in development.
Crossword Cybersecurity (CCS) has taken advantage of the high profile of cyber security to raise cash at a premium to the market price. Crossword raised £145,000 at 230p a share. The current mid-price is 195p a share and the most recent trade was at 197p a share last September. Brenlen Jinkens took up 50% of the new shares and he has 5.13% of the company.
Wheelsure Holdings (WHLP) reported a dip in interim revenues due to the lack of funding so the planned £500,000 fundraising should enhance progress. In the six months to February 2017, the loss increased from £126,000 to £159,000 as revenues fell from £133,000 to £94,000.
Mechan Controls (MECP) improved its underlying 2016 operating profit from £518,000 to £594,000 on revenues that were 5% ahead at £4m but there have been significant changes since last year. Nirvana is the only subsidiary left. At the end of 2016, there was £829,000 in the bank and the NAV was £2.41m. Mechan is paying a final dividend of 2.27p a share and the shares go ex-dividend on 1 June. Once all the operations are sold money will be returned to shareholders.
Secured Property Developments (SPD) had cash in the bank of £341,000 and an NAV of £689,000 at the end of 2016. The company is valued at a 47% discount to NAV.
Social housing finance provider Queros Capital Partners (QCP) has raised an additional £875,000 by issuing 8% unsecured bonds 2025. That takes the bonds in issue to £3.5m – from 19 separate placings. So far, short-term bridging loans have generated income to fund the interest payments on the bonds. Longer-term, there are plans to acquire social housing properties.
Blockchain technology company investor Coinsilium Group Ltd (COIN) says that investee company RSK Labs has raised $3.5m. Coinsilium retains the right to 1% of RSK via a convertible. RSK has developed a sidechain to the Bitcoin that enables smart contracts. There could eventually be scope to handle more than 20,000 transactions per second but that requires the additional investment.
NQ Minerals (NQMI) has raised £751,000 at 0.3p a share. Colin Sutherland has been appointed as finance director.
Enterprise software provider Sanderson (SND) is growing strongly but the cost of investment in the business will hold back short-term profit. The digital retail division is growing fastest but its operating profit was flat as management investors in order to maintain the strong growth rate. In the six months to March 2017, revenues were 10% higher at £10.9m and operating profit was 5% ahead at £1.55m. There was net cash of £4.51m and the dividend was increased by 10% to 1.1p a share.
Software supplier Cerillion (CER) continues to grow its revenues as it starts to build its customer base outside the mobile sector. In the six months to January 2017, revenues were 10% ahead at £7.5m and underlying profit was nearly one-third higher at £900,000. Orders worth £9.4m were won during the period. The interim dividend was 8% higher at 1.4p a share. Directors’ sold 4.2 million shares at 120p each, which could help to improve the liquidity in the shares.
Redx Pharma (REDX) has failed in its attempt to juggle its cash requirements and its debt and administrators have been appointed. Liverpool City Council has previously extended the maturity date of its £2m loan but Redx did not repay the debt when it became due at the end of March. There is also interest due and that could total more than £1m. Redx nominally raised £12m in February – an equity swap agreement meant that not all of this was raised immediately – but does not appear to have raised enough to pay the loan. That is blatant bad management which has ended up destroying the investments of shareholders. Iain Ross recently took up the role of chairman so it would be unfair to blame him but the other directors, including those that have recently departed, were responsible for running the business properly and they knew when this money had to be repaid. The directors are Dr Neil Murray, Norman Molyneux, Dr Bernhard Kirschbaum and David Lawrence, while Dr Frank Armstrong, Peter McPartland, Dr Peter Jackson, Philip Tottey and Dr Derek Lindsay have resigned since Redx joined AIM. Investors’ should be aware of these people if they are or become involved in any other companies.
Lombard Risk Management (LRM) increased its revenues from £23.7m to £34.3m in the year to March 2017. The pre-tax loss was reduced from £2.2m to £1.6m. The year-end order book was worth £10.1m. Management expects the company to be cash profitable this year. Legislation continues to drive demand for reporting and risk software.
Flowgroup (FLOW) could not find a buyer for its energy supply business at an appropriate valuation so it is raising up to £29m in shares (at 1p each) and bonds, including more than £600,000 raised at 1p a share via PrimaryBid, to finance its development. This is highly dilutive even before any conversion of the bonds at the conversion price of 0.95p a share. Flowgroup also requires £1m to market its Flow boiler in Europe and £4m to end the manufacturing contract with Jabil. In 2016, there was a loss of £23.7m on revenues of £99m. Net cash was £3.7m at the end of 2016. An increasing number of smaller competitors are entering the energy supply market and this led to a reduction in customers. The funding will help Flowgroup to compete and build up its customer numbers.
Big data software supplier Fusionex International (FXI) plans to leave AIM and it already has the backing of shareholders owning 41.9% of the company for the general meeting vote on 15 June. Management blames the lack of liquidity in the shares and paucity of independent research. The also blame political uncertainty in Europe. Fusionex had a gravity defying rating in the first year or so of trading on AIM but the share price is currently less than one-fifth of the peak at the beginning of 2014. The company’s growth strategy will remain unchanged. There are plans to arrange a trading facility in the shares.
Safestay (SSTY) has paid €3m in cash for U Hostels, which operates a 226 bed hostel in Madrid. U Hostels also owns an apartment block near the hostel, where managed apartments are expected to be completed during 2018, and a building in Paris that is being converted into a 260 bed hostel, which has a 12 year lease that can be extended by a further 12 years. Safestay will have to invest up to €2.3m in the Paris development, which should be completed in early 2019. In total, including development spending, the acquisition cost will be up to €6.5m. The original Madrid hostel made a small loss on revenues of €1.3m. Earlier this year, Safestay raised £12.6m from the sale and leaseback of the Edinburgh and Elephant & Castle hostels – the leases are for 150 years.
Strategic Minerals (SML) made a maiden pre-tax profit in 2016. The $351,000 profit was after $691,000 of other income – predominantly the settlement of a rail dispute. The Cobre tailings business continues to generate profit and cash.
Thor Mining (THR) says that the Pilot Mountain tungsten resource inventory has risen to 11.73 million tonnes at 0.28% WO3. This does not include the GunMetal and Good Hope deposits.
Greatland Gold (GGP) has granted access to Newmont to the Ernest Giles tenements for a period of six months and it will have first right of refusal for a disposal or joint venture. An airborne survey has identified new structural targets suitable for gold mineralisation. Metal Tiger (MTR) has exercised 15 million warrants at 0.2p a share.
LED lighting systems developer PhotonStar LED (PSL) cut its full year loss from £3.03m to £1.43m on lower revenues. The first quarter of 2017 was tough but there have been orders for its Halcyon devices. R&D has been reduced.
Fairpoint (FRP) has delayed its full year figures yet again. They are promised at some point in June. If they do not come out then then trading in the shares will be suspended.
Arian Silver Corporation (AGQ) has raised £600,000 has raised at 0.5p a share. The cash will be used for exploration of silver and lithium projects.
Mortice (MORT) has won UK contracts worth £2.25m via its Elite subsidiary that take it into new sectors. Elite has won a three year cleaning and waste contract with Surrey and Sussex police and after securing a place on BMW’s approved supplier list a two year contract with the car maker.
Orogen (ORE) intends to acquire Thread 35, which owns e-commerce womenswear brand Sosandar. Orogen is lending up to £250,000 to Thread 35. Sosandar is targeted at 35-55 year old women. Trading in the shares has been suspended.
Active Energy Group (AEG) has entered into an agreement in principle with the Province of Newfoundland and Labrador which will provide a timber licence and a forest management agreement covering 1.2 million hectares. The licence would enable the harvesting of up to 140,000 cubic metres of wood annually.
Thomas Charlton has further increased his stake in North Midland Construction (NMD) taking it to 7.24%. Finance director Daniel Taylor recently acquired 23,321 shares at 305p each. North Midland says that its first quarter profit has increased from £237,000 to £580,000 on a 5% rise in revenues to £62.2m. The main reason behind the improvement was a swing from loss to profit by the telecoms infrastructure division but the construction and water divisions generated a lower profit. Management still believes that margins can be improved. The order book is worth £254m helped by the AMP6 water investment cycle getting going. There is the promise of growing dividends.
Shareholders have agreed to the proposed bonus issue by Sealand Capital Galaxy Ltd (SCGL). On 1 June, existing shareholders will receive nine bonus shares for each one they own, leaving them with ten times the number of shares and the share price would be adjusted from 28.5p to 2.85p. The November 2015 flotation price was 10p (1p adjusted) and earlier this year a further £1.4m was raised at 20p (2p adjusted) a share.
Dukemount Capital (DKE) has signed a binding letter of intent for its first deal with a housing association to develop supported living accommodation. The plan is identify properties worth up to £5m which will be leased to Larch Housing Association on a 50 year lease at 6.5% a year plus inflation. Dukemount floated on 29 March.
Health food products supplier World Trade Systems (WTS) has entered into memoranda of understanding with Germany-based Naturemed and Germany-based Biestmilch, which will help it to widen its product range. Naturemed is a new company but Biestmilch was formed in 1999. Trading in the shares has been suspended for years and it is approaching ten years since there was a trade in WTS shares.
CIC Gold Group Ltd (CICG) left the standard list on 25 May. Management believes it will get a better valuation on another designated exchange.
Mechan Controls (MECP) is selling its main subsidiary to its technical director and intends to sell its other business and return cash to shareholders. The core business is being sold for up to £2m, with a minimum of £1.64m, including £1.24m initially, payable. The final £360,000 is dependent on the buyers selling the 142,300 shares they own in Mechan Controls. This leaves the group with Nirvana Engineering, which made a pre-tax profit of £352,000 last year. The company is changing its name to Mandicon.
Wine maker Chapel Down Group (CDGP) is putting a brave face on the frosts at the end of April. These were the worst frosts in April for two decades. There was a patchy impact with some vineyards impacted and some not. The company says that it mitigates risk by sourcing fruit from a wider area. The potential crop will become clearer in June. A further 129 acres of vineyard will be planted in the rest of this year.
Bulgaria property investment company Black Sea Property (BSP) is still negotiating a loan from UniCredit Bulbank to finance the acquisition of the UniCredit Building. Black Sea Property is paying €10.52m for the building – a deposit of €1.04m has been paid – and €7.6m of this will come from a loan. Once this loan is secured then a share issue can be undertaken. It appears that the deal may not be completed in May as originally envisaged. Unicredit can remain in the building for six months after completion and does not have to pay rent. The deposit will be forfeited if the deal does not go ahead. Black Sea Property has extended the repayment date of £100,000 of the unsecured loan facility from Phoenix Capital to the end of July. Discussions continue about the assignment to Phoenix of the investment advisory agreement from AG Asset Management. Anthony Gardner-Hillman is stepping down from the board and a replacement should be appointed in the near future.
Ace Liberty and Stone (ALSP) has acquired the Grosvenor Casino site in George Street, Manchester for £4m. The annual rental is £300,000. Ace has also bought the company that owns Willow House in Aldershot for £1.05m.
Angelfish Investments (ANGP) says that the loan of £497,500 has been repaid with interest by 4 Navitas. The talks about a joint venture have ended and Angelfish is trying to recover professional fees and expenses. This means that Angelfish has £1.1m in the bank and a loan to One Media Enterprises of $425,500 and it is seeking pre-IPO investments. It should be remembered that Angelfish has £2.3m of preference shares in issue.
Early stage investor Primorus Investments (PRIM) says that cloud-based food service business Fresho has announced that annualised revenues through its platform is nearly A$100m. The platform connects wholesalers and suppliers to restaurants, hotels, independent supermarkets, hospitals, pubs and other retailers. Additional automation will help to boost margins. Primorus, which is also quoted on AIM, invested £175,000 in Fresho in September 2016. Another round of funding is expected early next year. That will provide an opportunity to revalue the existing investment.
Etaireia Investments (ETIP) is buying two office buildings at Whitehouse Office Park in Peterlee, County Durham, with 113 out of the 125 year lease left unexpired. The purchase price of £1.125m will be paid through a combination of 600 million shares at 0.1p a share, giving Taxspecialefx (Peterlee) LLP a 24.3% stake, and cash payment of £525,000 deferred for 12 months. Completion is expected within three months. The annual rental income is £99,500. The seller is entitled to 75% of rental income until the deferred payment is made.
Adnams (ADB) non-executive director Guy Heald has sold 310 B shares at £114 each, raising £35,340. He retains 15.9% of the B shares.
All Star Minerals (ASMO) has raised £40,500 at 0.075p a share. Equatorial Mining & Exploration (EM.P) has raised £14,000 via the exercising of warrants at 0.01p each and it has also issued 110 million irredeemable 0.01p convertible loan notes.
The new management team has spent 2016 restructuring Quantum Pharma (QP.). One part of the business has been closed and another may be divested. The focus is niche pharmaceuticals and specials. In the year to January 2017, pre-tax profit dropped from £10.1m £6.2m. There will be a recovery in profit this year but it will take another year for profit to get back to £10m.
Podcasts supplier Audioboom (BOOM) has increased its revenues from £192,000 to £1.31m although it continues to lose money. There is already more than £3m of recognised or pre-booked advertising for 2017. Audioboom has built up its user base and it has started to generate revenues on the back of that. The acquisition of advertising technology firm SONR should help to further target advertising. Audioboom will make a further loss this year and, even after raising around £5m, the net cash is expected to be less than £1m at the end of 2017.
Management spent a significant amount of time last year sorting out the operations that Inspiration Healthcare (IHC) inherited when it reversed into the AIM-quoted business. This meant that underlying profit was flat at £1.1m. Demand for pre-natal care equipment and services is rising. There is scope for further organic growth and for acquisitions.
Pennant International Group (PEN) says that Lockheed Martin has increased the size of a contract from £200,000 to £2.2m, with potential for me. The total order book is worth more than £35m.
A concept study for the CS pozzolan-perlite project has persuaded Sunrise Resources (SRES) to focus on the project. It is thought that the 100%-owned project should have low caped and operating expenses thanks to surface mining and simple production processes. The pozzolan mined can be used as a greener alternative to Portland cement. There are no defined resources yet.
Onshore oil and gas explorer Egdon Resources (EDR) has submitted a new planning application for the Wressle field development. This follows the rejection of the previous planning application by North Lincolnshire Council. Egdon is also appealing the original decision.
Verona Pharma (VRP) raised $80m at the time of its flotation on Nasdaq. The shares were issued at 132p each and the ADSs issued in the US at $13.50 each – one ADS represents eight shares. The ADSs are trading on the Nasdaq Global Market. Last month, respiratory disease treatment developer has received authorisation from the FDA to proceed with a clinical trial for RPL554.
Manufacturer of professional audio equipment Focusrite (TUNE) produced good interim figures thanks to strong sales in North America. Interim revenues were 24% higher at £32m with pre-tax profit 89% ahead at £4.6m. Net cash is £9.4m and the interim dividend was raised by 15% to 0.75p a share. . Edison has upgraded its 2016-17 pre-tax profit forecast from £8m to £8.5m.
The Article 6 Marital Trust has become the largest shareholder in FIH Group (FIH), with 28.9%, following the sale of shares by Blackfish Capital Alpha Fund and former bidder Staunton Holdings at 300p each. Edmund Rowland has stepped down as chairman.
PowerHouse Energy (PHE) has moved its ultra high temperature gasification waste to energy G3-UHt unit to the Thornton Science Park, operated by the University of Cheshire. This will enable further development and opportunities for demonstrating the technology.
LED lighting products developer Photonstar LED (PSL) has taken advantage of a sharp share price recovery to raise £465,000 at 1.25p. The cash will be used to roll-out new product ranges.
Sanderson Group (SND) says that interim figures are in line with expectations. The retail and manufacturing software provider increased interim revenues from £9.86m to £10.9m – just under 50% is recurring revenues. Digital retail revenues were one-fifth higher. Net cash was £4.51m at the end of March 2017. Full year pre-tax profit is expected to rise from £3.44m to £3.72m. The interims will be published on 24 May.
Strategic Minerals (SML) is acquiring its joint venture partner’s stake in Central Australia Rare Earths for £522,500. Larger amounts of funding will be required to explore the resource than originally thought. Cash generated from Cobre in New Mexico will be used to finance this investment.
Digital audio technology developer Frontier Smart Technologies (FST) says that its first half revenues is significantly ahead of last year and full year EBITDA is set to be well ahead of expectations with margins higher than anticipated. Analogue radio has been switched off in Norway and there is strong demand for digital radio across Europe. Smart audio contracts have been won and there will be a better indication of progress in the second half.
Gas producer Ascent Resources (AST) has re-entered the second well at the Petisovci gas field in Slovenia. The well is being prepared for production, which should take four weeks. There has been a further objection to the Integrated Pollution Prevention and Control permit, which it requires to build a gas processing plant so more gas can be produced.
DP Poland (DPP) says that system sales grew by 21% in the first quarter of 2017. There have been eight stores added this year and a new commissary is under construction.
Accident prone Redcentric (RCN) appears to be sorting itself out but it is not out of the woods yet. Net debt is estimated at £39.5m at the end of March 2017 and the bank appears to support the company. Waivers have been received for covenant breaches and there were large exceptional charges. The underlying pre-tax profit is forecast to rise from £6.3m to £9.1m.
Personal care products supplier InnovaDerma (IDP) has acquired the owner of the IP for Prolong, the only FDA-approved medical device for the treatment of premature ejaculation, a market valued at more than $1bn a year. This is part of a strategy to build up a life sciences division. Prolong is a non-prescription, vibrating medical device that is used in training in order to increase time between arousal and ejaculation. The device could cost between £250 and £300. InnovaDerma is paying £1m in shares, issued at a 25% discount to the market price minus the settlement of current liabilities at the current share price – estimated at £323,600. On top of this, a royalty of £11 per unit sold will be paid until the patent runs out in 2031 and if Prolong generates an operating margin of 20% in any year a bonus of £150,000 is payable. Prolong will be launched in North America in the second half of 2017 and Europe and Australia next year. InnovaDerma also announced that its self-tanning Skinny Tan products will be available on the ASOS website.
Opera Investments (OPRA) is going ahead with its acquisition of Kibo Gold from AIM-quoted Kibo Mining (KIBO) for £3.66m in shares at 6p each and moving from the standard list to AIM. The acquisition has the Imweru and Lubando gold projects in Tanzania. Opera is also raising £1.5m at 6p a share – it already had £486,000 in the bank. The Imweru project could be producing 50,000 ounces of gold a year within two years. Opera is changing its name to Katoro Gold.