Carduus Housing (CHPB/CHP2) has discovered that £1.43m of its cash has been paid to Carduus Finance Ltd and £875,000 to a third party. It is estimated that £1.675m of this cash did not conform to budgeted spending or the company’s investment strategy. Carduus Finance has subsequently sold its stake in Carduus Housing for £1. Pankaj Rajani owns 75% and Beaufort Securities 25%. Peterhouse has resigned as corporate adviser and Brian Gilmour, Drew Oswald and Luke Cairns have resigned as directors. Pankaj Rajani and Darren Edmonston have joined the Carduus board. Gilmour is one of the main shareholders in Carduus Ltd, the holding company for Carduus Finance. On 2 February 2016, in his capacity as sole director, he made a solvency statement for Carduus Ltd. Stuart Black who was a director of ISDX-quoted Etaireia Investments is a former director of Carduus Ltd and Carduus Finance. When Black was on the Etaireia board it claimed it had planning permission for a site in Scotland but this proved to be untrue. Carduus Housing joined ISDX on 30 September 2015 when £3.5m of 6.5% unsecured bonds were admitted to trading. It has subsequently raised £3.5m from the issue of 6.25% unsecured bonds. Trading in the bonds remains suspended pending clarification of its financial position. The strategy is to invest in affordable housing, with 37 properties currently owned, but this may be changed. There is still £1.9m in the bank. The company will try to recover the cash that has been paid out for reasons outside the remit of the corporate strategy. Carduus Housing may need to raise additional cash by 2020 in order to redeem the bonds.
Secured Property Developments (SPD) continues to seek a suitable residential development project and it has widened the scope of its search to outside of the M25. A property in Scarborough has been sold for £327,500 – it was in the books for £300,000 – and no other investment properties are owned. The NAV was £758,000 at the end of 2015. There should be more than £700,000 in cash after the disposal. At 19.5p (18p/21p) a share, Secured Property is valued at £400,000.
Leni Gas Cuba (CUBA) is linking up with Commercial Funded Solar Ltd (CFS) in order to install and operate renewable energy assets in Cuba. CFS was established as a limited company in February 2015. The directors include Dmitry Gavrilov, who joined the board in March 2016 and is a 10% shareholder, and Timothy Dobson, who owns 80% of the company. Cuba wants to produce 24% of its electricity from renewable sources by 2030. The funding for any projects will come from external investors. The income related to developing and installing the plant will be shared 50/50 while Leni Gas Cuba will receive 25% of the revenues from operational contracts. At 1.35p (1.2p/1.5p) a share, Leni Gas Cuba is valued at £6.7m.
Brett Miller has resigned as a director of Gledhow Investments (GDH), although he remains company secretary, and has sold his 2.2 million shares at 2.2472p each – a large premium to the market price. At 1p (0.75p/1.25p) a share, Gledhow is valued at £490,000. On 11 May, 170,000 shares were traded at 1.15p each. Peterhouse employee Guy Miller has joined the board. He owns 264,700 shares.
Online retailer of musical instruments Gear4music (G4M) more than doubled its underlying operating profit in the year to February 2016. Revenues increased from £24.2m to £35.5m, while underlying operating profit excluding flotation cots jumped from £376,000 to £895,000. There was a small pre-tax profit after interest charges. The cash raised in the flotation means that these interest charges will be significantly reduced this year. Net cash was £2.6m even after investing in higher inventories. The product range is being expanded by 20% each year. Instead of a London showroom, the company is planning to open up European distribution hubs. There is a chance of a dividend for this financial year.
AdEPT Telecom (ADT) is acquiring managed IT and telephony services provider Comms Group UK for £3.5m plus surplus cash. The management is remaining with the business which has long-term relationships with small business customers. The business made an operating profit of £500,000 in the year to March 2015 and that is estimated to have risen to £800,000 in 2015-16, so the deal should be immediately earnings enhancing. Further information on AdEPT can be found at http://www.hubinvest.com/AIMPDFMay2016_80.pdf.
Digital performance marketing services provider XLMedia (XLM) says current trading remains strong and it still has organic growth opportunities on top of the potential for consolidation. The strategic review has been completed and XLMedia still believes that it should remain on AIM. The company will continue to seek opportunities in new territories and sectors as well as further developing its technology.
Marble quarry business Fox Marble (FOX) has raised £2m at 10p a share and the directors have agreed to take their salaries in shares at the market price. The cash will help to finish the Kosovo factory where cut and polished marble slabs should be produced by the summer.
MediaZest (MDZ) has raised £250,000 through a share issue at 0.1p each and it has capitalised a loan of £50,000 at 0.15p a share. The audio visual company says that it made its best ever performance in the year to March 2016. The cash will help to finance working capital for projects with HMV, Adidas and Diesel. MediaZest is trying to build a recurring revenue base.
Telecoms services provider Toople (TOOP) made strong start to trading on the standard list despite the limited nature of its current business. One man who will be pleased to see the shares go to a premium is chief executive Andrew Hollingworth, who acquired his 26% stake for less than £20,000 when the company was formed on 2 March 2016and it is currently worth more than £2m. His shares were issued at 0.0667p each compared with the placing price of 8p a share and the current share price of 8.88p. Hollingworth has an annual salary of £120,000 –Toople will have to grow to generate revenues that high – and seven weeks holiday entitlement each year. Former Coms boss David Brieth sold the main operating businesses to the group for 39 million shares and he is paid £120,000 a year, which is effectively for a three day week.
In the six months to March 2016, trickle ventilator and window components manufacturer Titon (TON) reported a dip in profit from £792,000 to £735,000 on flat revenues of £10.9m. That was due to weak Korean trading as competition increased. Net cash was £2.46m at the end of March 2016.
Engineering and environmental consultancy Waterman Group (WTM) says that revenues were 10% ahead in the first nine months of this financial year and is on course for a full year profit of £3.3m in the year to June 2016. Net cash will be better than expected. Waterman wants to improve its operating margin from 3.3% in 2014-15 to around 6% in 2018-19.
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