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Andrew Hore – Quoted Micro 15 February 2021
AQUIS STOCK EXCHANGE
Oberon Investments Group (OBE) has joined the Access segment following the reversal of the wealth management business into standard list shell Baskerville Capital. Assets under administration are more than £400m. Oberon was formed in 2017 and acquired investment manager MD Barnard. It also has a corporate broking business, and it is joint broker to MyHealthChecked (MHC). There was £1.44m raised at 4p a share at the time of the reversal.
Brewer Curious Drinks is being placed into administration and the business will be acquired by Risk Capital Partners, which was founded by Luke Johnson. This will have to be agreed by the HMRC and the secured creditor HSBC. There should be no redundancies Majority owner Chapel Down Group (CDGP) is offering small shareholders in Curious Drinks a share swap. There will be 1.57 Chapel Down shares issued for each Curious Drinks share. In 2015, Curious Drinks raised £1.71m via a crowdfunding with Seedrs, which equates to a market capitalisation of £17.7m. That funding was equivalent to 9.66% of Curious Drinks and there were 886 shareholders. The share swap should provide around 50% of the initial investment. There will be less than 1% dilution for Chapel Down shareholders. Chapel Down net debt will be slashed from £7.2m to £100,000. There was a loan from Chapel Down to Curious Drinks of £7.77m included in the 2019 accounts.
Coinsilium (COIN) holds $1.98m of cryptocurrency and tokens, which is a 17% increase in fewer than three weeks.
Gunsynd (GUN) has sold all its shares in Angold Resources. This raised £163,000. Chris Akers has increased his stake in Gunsynd to 5.36%.
Tectonic Gold (TTAU) continues to have a 100% success rate for its exploration drilling. According to managing director Brett Boynton the latest hole shows “multiple stacked veins somewhat like a palm tree spraying out mineralised fronds from the primary fault zone”.
NQ Minerals (NQMI) has raised £301,000 at 7p a share from one institution and private investors. Vulcan Industries (VULC) has raised a further £185,000 with some shares placed at 3.6p and some at 4p.
Western Selection (WESP) has bought a further 150,000 shares in Bilby (BILB) at 29.8p each. The total stake is 11%.
AIM
Joules (JOUL) has acquired the Garden Trading Company, which takes it into the home and garden market and adds annual revenues of £168m. Joules is paying £4.5m in cash and 2.83 million shares. Peel Hunt has increased its 2021-22 pre-tax profit forecast by £2m to £10.6m.
Engineer Avingtrans (AVG) maintained its interim revenues at £54.1m and the stemming of losses at recent acquisitions has helped pre-tax profit to nearly double to £3.5m. It offset the lower demand from the oil and gas sector. The recent merging of the MRI operations with Magnetica, will enable niche MRI products to be developed, but it will take time for the revenues to come through. Meanwhile, Avingtrans is stopping supplying third parties. The valuable Luton site could be sold in the next year or so if market conditions allow.
Kromek (KMK) is raising up to £13m via a placing and open offer at 15p a share. The cash will be used to accelerate the commercialisation of its bio-security products and boost the marketing of medical imaging and nuclear detection products. Intuitive Investments Group (IIG) is investing £250,000 in the placing.
Packaging manufacturer Robinson (RBN) is acquiring blow moulded containers producer Dhela Plast for up to £7.7m. There will be additional investment of £2.4m in the Danish company. The customer sectors are similar to Robinson and the deal widens its geographic reach.
MAIN MARKET
Motor finance provider S & U (SUS) expects a rebound in demand when lockdown restrictions are eased. In the past two months new deal transactions are running at nearly 80% of previous levels. Investment in Aspen Bridging has been increased because of the strong demand. A second interim dividend of 25p a share has been announced.
A planned demerger of assets by Aseana Properties Ltd (ASPL) has been stopped because the banks have not agreed to the proposal.
Castillo Copper Ltd (CCZ) confirms an extension to the 100%-owned Big One deposit and JORC modelling is underway.
Argo Blockchain (ARB) intends to acre 320 acres in Texas where it will build a new mining facility in the next 12 months. The overall cost will be $17.5m in shares.
UP Global Sourcing (UPGS) grew interim sales by 11%. Beldray represented 28% of sales, with the next biggest contributions coming from licenced brands Salter and Russel Hobbs.
One Heritage Group (OHG) is taking advantage of the share price rise over the past two months to raise £548,500 at 30p a share. The residential developer floated before Christmas at 10p a share. One Heritage plans to buy an office block in Stockport, which can be converted into residential. Plus House will cost £725,000.
Tirupati Graphite (TGR) is increasing the planned flake graphite capacity of the first module at the Vatomina project by 50% to 9,000 tonnes a year. The project will be commissioned in the second quarter. Carboflamex and other expandable graphite products produced by the company have gained certification to be sold in the EU.
Avation (AVAP) has entered into a lease with an Asian airline for an ATR72-600 aeroplane, which should be delivered in March.
Andrew Hore
Andrew Hore – Quoted Micro 19 October 2020
AQUIS STOCK EXCHANGE
Arbuthnot Banking (ARBB) remains profitable and loan balances have increased by 3% to £1.6bn. Deposit balances are 14% higher at £2.23bn. Assets under management are 4% ahead.
Wine maker Chapel Down (CDGP) has produced a better quality harvest than 2018 and yields are better than expected. More wine can be released for sale next year.
A general meeting has been requisitioned at SulNOx Group (SNOX) by three shareholders. They want to remove the entire board and appoint four new directors.
KR1 (KR1) has generated just over $1m from the sale of tokens in the Polkadot project at $5.12 each. That is a small proportion of the stake and KR1 still owns more than 3.5 million tokens.
NQ Minerals (NQMI) continues to increase production at the Hellyer mine. In the third quarter lead concentrate production was 11,865 tonnes and zinc concentrate production was 4,585 tonnes. Production rates are still increasing.
Wishbone Gold (WSBN) reported a reduction in interim revenues from $6.56m to $3.64m. There was a $224,000 outflow from operations.
Altona Energy (ANR) has extended its fundraising until 11 November. The plan is to raise up to £500,000 at 6.5p a share.
Trading has been suspended in the shares of medicinal cannabis company Freyherr International (FRYR) because trading has been difficult, and the auditing of last year’s accounts has not been completed.
VI Mining (VIM) is asking shareholders to approve of the withdrawal from the Aquis Stock Exchange.
Eastinco Mining (EM.P) has published full year and interim figures. The company remains loss-making. There was £173,000 in the bank at the end of June 2020.
TechFinancials (TECH) is stopping the development of its Footies ticketing technology because of the uncertainty surrounding events. It has also ended its investment in Cedex due to lack of cash. All B2B brokerage technology activities will end at the beginning of November. New opportunities are being assessed.
AIM
Synairgen (SNG) is raising up to £87m via a placing and open offer at 175p a share. This will finance a phase III trial for SNG001 for the treatment of Covid-19. That will start before the end of the year. Results are expected in the middle of next year. Synairgen will also invest in scaling up its manufacturing.
More good news from Touchstone Exploration (TXP) which has made another significant gas discovery in Trinidad. The Chinook-1 discovery is the third in a row. This means that Touchstone should be highly cash generative next year enabling it to fund more exploration.
LiDCO (LID) had already outlined its interim figures in a trading statement so the move into profit thanks to high monitor sales to the NHS was not a surprise. There is likely to be a second half loss, but the heart monitoring equipment supplier will still be profitable for the full year. There have been delays in winning hup recurring revenue contracts, but these revenues have reached an annual rate of £3m. There was £3.1m in the bank at the end of July 2020.
BlueRock Diamonds (BRD) increased production in the third quarter from 3,973 carats one year ago to 5,577 carats. Sales were much lower at 3,803 carats because there was one sale during the quarter. The average price realised has fallen from $432/carat to $330/carat. That was expected due to the change in mix of stones with only one high value stone sold during the period. An updated resource estimate is expected in the near future. BlueRock is hosting a shareholder conference call at 7pm on 22 October. Anyone wanting to participate should go to www.facebook.com/valuethemarkets or www.twitter.com/valuethemarkets.
SkinBioTherapeutics (SBTX) is raising money to accelerate the progress of AxisBiotix, which is involved in the development of food supplements for psoriasis treatment. This could be generating revenues in the year to June 2022. A placing at 16p a share raised £4m with up to £500,000 to come from an open offer at the same price. Some cash will be available to fund development of other microbiome-related products. This cash should last until the end of 2022.
Billing and customer relationship management software provider Cerillion (LSE:CER) says that its year-end order book is at a record level and the full year figures will be slightly better than expected.
ThinkSmart (TSL) is returning A$6.5m of cash to shareholders. There will be a 4.575 cents a share capital reduction and a 1.525 cents a share unfranked dividend. ThinkSmart has around £10m in the bank. The current exchange rate is 55p for each A$1. The distribution is worth £3.6m, so around one-third of the available cash.
Seeing Machines (SEE) is increasing its potential market by developing its driver monitoring system into vehicle occupant monitoring system. This is an additional revenue opportunity of A$350m.
Angling Direct (ANG) managed to stay profitable in the first half as online sales helped to offset the closure of retail sites in the period. The fishing products retailer has a strong balance sheet and shop sales bounced back after reopening. A pre-tax profit of £400,000 is forecast for the full year, rising to £1.5m next year.
Netcall (NET) is acquiring robotic process automation technology company Automagica in order to enhance its contact centre products. Automagica has its own technology. Netcall’s full year revenues increased from £22.9m to £25.1m, while pre-tax profit increased from £1.3m to £1.8m. Margins are improving.
MAIN MARKET
Motor dealer Lookers (LOOK) says third quarter trading was better than expected. New and used car volumes increased by 13.6% compared with the same period the previous year. Lookers has outperformed the market. Aftersales revenues were also higher. Net debt was £22.5m at the end of September 2020.
Electronic products supplier DiscoverIE (DSCV) says that first half sales fell by 6%, but orders were ahead of sales in September. A dividend will be announced with the interims in November.
Construction and infrastructure firm nmcn (NMCN) has reviewed major contracts and this will lead to a loss this year. The main problem has been water contracts and some of the charges may relate to other periods. This follows the departure of the chief executive and finance director.
Nanoco (NANO) has a cash outflow to £300,000 a month. There is net cash of £5.2m and that should last until July 2022. The non-cadmium quantum dots technology developer lost £4.9m in the year to July 2020.
Andrew Hore
Andrew Hore – Quoted Micro 5 October 2020
AQUIS STOCK EXCHANGE
Wine and beer maker Chapel Down (CDGP) made a similar interim loss this year. Wine revenues were one-fifth ahead even though sales were lost in pubs and the company’s own retail site. Online sales offset those declines. Wine stocks have increased by one-third to £11m. Beer and cider sales fell by 38% and gross profit slump by 59%. There was £5.83m in cash at the end of June 2020.
Coinsilium Group Ltd (COIN) reported an increase in interim revenues from £109,000 to £140,000. Reversal of impairments and unrealised gains helped to generate a pre-tax profit of £27,000, down from £242,000 because of lower unrealised gains. NAV was £2.52m, including cash of £129,000, at the end of June 2020. Since then, there has been an increase in the value of cryptocurrency and tokens held by the company.
Western Selection (WESP) has sold its stake in AIM-quoted Brand Architekts (BAR) and raised £1.43m at 109.78p a share. The shares were valued at £1.63m in the recent balance sheet. Peter Gyllenhammr increased his stake in Brand Architekts from 6.1% to 10.5%.
KR1 (KR1) reported an interim pre-tax profit of £522,000, including an unrealised gain of £711,000. The NAV was 6.18p a share at the end of June 2020. The latest digital asset investment is $100,000 in the Moonbeam Network project. This is a smart contract platform and KR1 will receive Glimmer tokens that will power Moonbeam’s blockchain.
Incanthera (INC) has announced positive data for a skin sensitisation study for skin cancer technology Sol. This shows it to be non-irritant. ImmuPharma has subscribed £250,000 for shares at 9.5p each. That takes the stake to 15.3%. A total of £350,000 was raised with directors subscribing for the other £100,000.
Housebuilder St Mark Homes (SMAP) has an NAV of 125p a share, compared with a share price of 87.5p (85p/90p). There was a swing from interim profit to loss.
Gunsynd (GUN) has invested £58,000 in gold explorer Angold Resources, subject to its reversal into ZTR Acquisition, which was formerly Oyster Oil and Gas, where Gunsynd already has a stake.
Property investor Ace Liberty and Stone (ALSP) has completed the £1.43m acquisition of a property in Scarborough leased to Skipton Building Society. It has exchanged contracts on a Carlisle property costing £1.71m.
NQ Minerals (NQMI) says that processing rates at the Hellyer gold mine have increased to 165 tonnes per hour. The average annualised production rate was 1.23Mtpa in July and August.
Gowin New Energy Group (GWIN) says it is near to appointing a new corporate adviser so that trading can resume in the shares. Management is working towards launching a tea business.
Primorus Investments (PRIM) has invested £1m in construction payments software company Zuuse. Thi is part of a £2.2m fundraising to pay for a transaction expected in the next few weeks. Primorus already owned shares and warrants in Zuuse, so it owns 1.7% of fully diluted share capital. Primorus has sold six million Greatland Gold (GGP) shares at an average price of 14.8p each. That leaves Primorus with 20 million Greatland shares.
Capital for Colleagues (CFCP) had an NAV of 51.53p a share at the end of May 2020.
IFA group AFH Financial (AFHP) says that business is recovering and it continues to be profitable and cash generative.
Eurocann International (BUD) is changing its name to DiscovOre (ORE) and the investing strategy broadened to include natural resources as well as cannabis-related activities.
SativaWellness Group Inc (SWEL) has been readmitted to the AQSE growth market following the reverse takeover of the company.
AIM
Avingtrans (AVG) improved its 2019-20 pre-tax profit from £5.3m to £5.9m despite loss contributions from recent acquisitions. One of those acquisitions, Booth Industries, has won a £36m doors contract for HS2. finnCap forecasts a 2020-21 pre-tax profit of £7.3m and Avingtrans is likely to reinstate the dividend.
Demand for the type of data erasure and cyber security services provided by Blancco (BLTG) remains strong, although April and May were tough. In the year to June 2020, revenues improved from £30.5m to £33.4m, helped by acquisitions. Pre-tax profit grew from £3m to £3.9m. Investec expects further profit improvement to £4.3m this year, but it will be second half weighted.
Geospatial services provider 1Spatial (SPA) reported an 8% rise in interim revenues to £11.7m, although the core business revenues made up a greater proportion of the total. There was an interim loss but positive operating cashflow of £1.7m. Net cash was £3.4m. 1Spatial could make a small full year profit.
Grant Thornton has decided to settle litigation with AssetCo (ASTO) rather than appeal the court judgement. This means that AssetCo can access the £28.6m lodged with the court plus the balance of money owed by Grant Thornton. Once this is received, AssetCo will have cash of £55m and net assets of around £52m. The market capitalisation already takes this into account.
The FDA has approved adrenal treatment Alkindi in the US and Diurnal (DNL) should receive a $2.5m milestone payment from distributor Eaton pharmaceuticals when sales start next year. That is on top of licence income. That means that Diurnal’s cash will last longer.
New Trend Lifestyle Group (NTLG) changes its name to Conduity Capital (CCAP) on 5 October. The former activities have been sold and Conduity becomes a shell.
Erris Resources (ERIS) plans to buy a 50% stake in Zinnwald lithium project owner Deutsche Lithium from Bacanora Lithium (BCN) in exchange for shares and a net profit royalty.
Yu Group (YU.) reported a decline in first half revenues from £56.6m to £45.9m due to lower energy consumption by its commercial energy customers. There was a lower loss in the period but reduced working capital requirements meant that there was a significant cash inflow from operating activities. There was £17.9m in the bank at the end of June 2020. Management has invested in marketing in order to win new business.
Intelligent Ultrasound (MED) is launching its first AI software product alongside GE Healthcare. GE has 480,000 ultrasound machines in use and the AI software will be integrated in a range of women’s health ultrasound machines. It could be rolled out across other machines in the future.
M and C Saatchi (SAA) has failed to publish its results and trading in the shares has been suspended. Windar Photonics (WHPO), Clear Leisure (CLP), Malvern International (MLVN), Tri-Star Resources (TSTR) and Hydrodec (HYR) have had share trading suspended for the same reason. The acquisition of Bristol Energy customers will boost scale and help Yu to move towards profitability.
MAIN MARKET
Car finance provider S and U (SUS) generated revenues of £42.8m in the six months to July 2020. That was a 3% decline, but the effects of the Covid-19 lockdown will be greater in the second half. Net receivables were down by 6% to £281.9m, but new loan volumes fell by one-third in the first half. Bad debt provisions were increased by £13.8m to £21.7m and this led pre-tax profit to slump from £17.1m to £6.3m. The property bridging loan business made a lower profit contribution, although the market has subsequently inproved. Even so, a dividend of 22p a share was announced, down from 34p a share.
Guild Esports (GILD) raised £20m at 8p a share. The share price ended the first day of trading at 8.15p.
Mining shell Critical Metals (CRTM) joined the standard list on 29 September. The placing price was 5p and the price was 5.5p at the end of the week.
Toople (TOOP) is on course to achieve £1.6m of annualised cost savings from integrating DMSL. The focus is on margin rather than just growing revenues.
Ross Group (RGP) reported a reduced loss of £830,000, down from £3.15m, in the first half of 2020. There were no revenues, but the company is trying to build up supply chain operations.
InnovaDerma (IDP) reported full year figures in line with its trading statement in July. The skincare products supplier slumped into loss due to higher marketing costs. There was cash of £1.2m at the end of June 2020.
Newspaper publishing consolidator National World (NWOR) had £4.31m in the bank at the end of June 2020. It is still evaluating acquisition opportunities.
Andrew Hore
Andrew Hore – Quoted Micro 29 June 2020
AQUIS STOCK EXCHANGE
Chapel Down Group (CDGP) increased sales last year, but the loss was also higher. Sales of wine and beer grew and revenues from continuing activities improved from £12.86m to £14.8m, while the loss more than doubled from £850,000 to £2.09m. the Chapel Down Gin Works in Kings Cross has been closed. There was still £2.47m in the bank at the end of 2019, even after the loss and £12m of investment in fixed assets and land. There are 428 acres of planted vineyard. Wine stocks have also increased following a good harvest. The Ashford brewery has been completed and full brewing capacity will be available before the end of the year. Martin Glenn is succeeding John Dunsmore as chairman.
Rutherford Health (RUTH) has entered into a £55m development framework agreement with Equitix, an investor in infrastructure assets. This will finance up to five diagnostic facilities in the UK. Each will be owned by a special purpose vehicle funded by Equitix and operated by Rutherford. An initial agreement has been made with a NHS Trust. Rutherford also announced a collaboration with Panthera Biopartners, which will be able to use Rutherford’s clinics for trials of potential cancer treatments.
Racing recommenced at Newbury Racecourse (NYR) on 11 June. Three race meetings have been held and five more are planned by the end of August. No public are being admitted. Revenues are coming from media rights. The Rocking Horse nursery reopened earlier this month.
Good Energy (GOOD) is increasing its investment in Next Green Car, which owns Zap-Map, to 50.1% through the exercise of a convertible loan.
BWA (BWAP) has spent £120,000 of the initial commitment of £250,000 for two rutile licence areas in Cameroon. Drilling programmes are being designed. COVID-19 has hampered progress with the company’s Canadian interests.
Coinsilium Group Ltd (COIN) says that investee company Factom Inc has filed for Cahpter 11 bankruptcy protection because of its failure to raise more cash. It could exit Chapter 11 protection within three months if things go to plan.The investment was valued at £237,000.
IamFire (FIRE) is reviewing strategies having raised £500,000 at 2.5p a share. Each share comes with two warrants with an exercise price of 10p a share. The investment focus is natural resources, mining and disruptive technology.
SAPO (SAPO) is still seeking a broadband investment and net assets were £1.1m at the end of 2019. At 3.2p a share, SAPO is valued at £6m.
Gunsynd (GUN) has invested £137,750 in Rincon Resources, which gives it a stake of 28.4%. Rincon has the rights to three prospective gold and base metals projects in Western Australia. Gunsynd has sold its stake in United Oil and Gas (UOG).
All Star Minerals (ASMO) has raised a further £200,000 at 0.02p a share, taking the total raised in share issues to £280,000. Convertible loan notes worth £55,000 have been converted into 275 million shares with 34 million shares at 0.01p each to pay liabilities. This means that more than 1.3 billion shares have been issued, which has nearly doubled the shares in issue.
AIM
Recent trading at floorcoverings supplier Victoria (VCP) has exceeded expectations. Manufacturing has restarted in all the company’s plants. All the main countries are doing relatively well considering the disruption due to COVID-19 and in the most recent three weeks revenues were 85% of pre-COVID-19 budget. The UK carpets business is only just getting going again. Net debt is £370m, which is predominantly bonds that last until July 2024. Cash generation can reduce debt, although management is likely to look for potential acquisitions.
Wynnstay Group (WYN) reported a decline in interim revenues but that was due to lower commodity prices. The interim dividend has been maintained at 4.6p a share. The agriculture division maintained its operating profit, but there was an improved profit from the merchanting division. Pre-tax profit edged up from £4.3m to £4.5m. Shore Capital has reinstated forecasts. It expects a pre-tax profit of £6.7m, down from £7.9m. This id a deliberately cautious figure.
MSQ Partners has launched a 0.5p a share bid for Be Heard Group (HRD) and that values the digital media company at £6.2m. The acquirer was the subject of a buyout last year. The combined business will have the backing of Lloyds Development Capital and the greater scale will help to win larger clients.
United Oil and Gas (UOG) says that average production from the Abu Sennan concession in the first two weeks of June was 13,900 boepd, of which its working interest is 3,060 boepd. That is 69% higher than the average daily figure in April. The 2P reserves at Abu Sennan have been increased by 12.55 to 13.5MMboe
Transense Technologies (TRT) has transferred its iTrack tyre monitoring business to a Bridgestone subsidiary for $1m and it will receive quarterly royalty revenues for the next ten years. That royalty would be £150,000/ quarter currently, but growth should be faster under Bridgestone. Two Transense directors are moving with iTrack. This leaves Transense with its SAWsense (wireless tyre sensor technology) and Translogik (tyre test equipment) businesses. Transense could move into profit in 2021-22.
A positive trading statement from allergy vaccines developer Allergy Therapeutics (AGY) led finnCap to increase its 2020 pre-tax profit forecast even though revenue growth is slower than expected. A 2019-20 profit of £2.9m is expected, partly due to the timing of research spending. Allergy is expected to move back into loss in 2020-21.
Beximco Pharmaceuticals (BXP) increased its revenues and pre-tax profit in the nine months to March 2020, with particularly strong growth in the third quarter. There is some disruption to international distribution and supply and full year revenue growth will be lower than originally expected.
Dekel Agri-Vision (DKL) reported flat full year revenues of €20.9m for 2019. The loss was barely changed at €3.29m. There has been a decline in the palm oil price in recent months, which will hamper performance this year. The cashew project is making good progress.
MAIN MARKET
Strong first half trading at BATM Advanced Communication (BVC) has led to broker upgrades for 2020. The biomedical division has done particularly well, but the networks and cyber division has also done better than expected. Stifel is raising its revenues forecast from $138m to $155m, while the EBITDA estimate has been increased by one-third to $13m. Shore Capital expects to increase forecast revenues by 17% to around $154m with a significant improvement in EBITDA expected.
Construction services provider nmcn (NMCN) made a positive start in the first quarter of this year. Revenues were 4% ahead at £97.9m and pre-tax profit 6% higher at £1.8m. This period was hardly affected by the lockdown. Since the end of March, work has been at three-quarters of normal levels. There was £11.8m in cash at the end of March 2020. The interims will be reported on 6 August and there should be guidance for the full year outcome.
Tex Holdings (TXH) expects to make further cost savings and consolidate more of its activities. The plastics division is operating at 70% of expected levels, while the engineering division has suffered delays but not lost business.
Standard list shell Boston International (BIH) had £302,000 in cash at the end of 2019. It is still assessing the proposed acquisition of invoice factoring company Alexanders Discount Ltd
Rainbow Rare Earths (RBW) has raised £1.25m at 3p a share. The cash will accelerate trial mining at the Gakara rare earth project in Burundi.
The 2019 figures of Ross Group (RGP) include pharmaceutical grade Chitin producer Archipelago Aquaculture Group (AAG) for the first time. There were restructuring and impairment costs relating to the acquisition. Pilot production is being implemented and there are joint venture discussions with the company that has developed the Ionic Liquid extraction process licenced by AAG. There was a £3.6m loss in 2019.
SMALL CAP AWARDS 2020
Company of the year: Volex
Technology company of the year: Avacta
Impact company of the year: ITM Power
IPO of the year: Diaceutics
Transaction of the year: Kape acquisition of Private Internet Access
Executive director of the year: David Cicurel (Judges Scientific)
Innovative financing of the year: Yu Group
Journalist of the year: Joanne Hart (Mail on Sunday)
Analyst of the year: Lorne Daniel (finnCap)
VCT manager of the year: Amati
UK smaller companies fund manager of the year: JPM UK Smaller Companies
Lifetime achievement award: Giles Hargreave
Andrew Hore – Quoted Micro 4 November 2019
NEX EXCHANGE
Chapel Down Group (CDGP) has managed to generate 92% of 2018’s record harvest in volume terms for the company’s wines. This was achieved even though the weather was not as good this summer. Some vineyards produced their first crop and are still maturing.
Belvedere Leisure Resorts plans to gain a quotation on the NEX Growth Market for its bonds on 22 November. The company is a subsidiary of Belvedere Leisure Park, which owns a site in Dumfries & Galloway with planning permission for a lodge park resort of 444 holiday lodges. The park will be built by Landal GreenParks. The bonds will offer a coupon 6.25%. An initial £10m of bonds will be admitted with a maximum of £25m expected to be raised.
First Sentinel (FSEN) is seeking shareholder approval to issue Green Finance preference shares, which would be quoted on NEX. The cash raised will be invested in the renewable energy sector. A general meeting will be held on 18 November. Warrants have been exercised at 10p a share and this has raised £400,000 for First Sentinel.
Mechanical and electrical design and installation company Field Systems Design Holding (FSD) reported a decline in revenues from £25.9m to £21.8m in the year to May 2019. Higher gross margins meant that the decline in the pre-tax profit was limited and it fell from £625,000 to £553,000. Water generated four-fifths of revenues, up from 48% the previous year. There are no solid spending forecasts, as yet, for the latest water capital investment period for between 2020 and 2025. This causes some medium-term uncertainty. The order book is worth £8.2m, compared with £12m one year earlier. There is a pension surplus.
KR1 (KR1) has made three more investments in blockchain-related tokens. A $100,000 cash investment and payment for advisory expertise will earn 1.017% of Vega tokens issued. Vega is developing a decentralised and censorship-resistant blockchain trading platform. A further $266,220 has been invested in Edgeware smart-contract platform tokens and they will be locked up for 12 months. KR1 will receive 1,000 Ether and this will translate into 3.8 million Edgeware tokens. KR1 has spent $50,000 on a minimum stake of 0.625% in Commonwealth Labs, which is helping to market the Edgeware platform.
Allenby Capital has published a research note on cannabis products supplier Sativa Investments (SATI) and it forecasts revenues of £1.64m in 2019 and £5.15m next year. This will not be enough to make Sativa profitable. Allenby believes that it may have to raise £6m next year to cover its cash outflows and maintain net cash. Sativa has changed the brand name from George Botanicals to Goodbody Botanicals.
Imperial X (IMPP) has raised £347,000 at 2.5p a share. This represents 27.3% of the enlarged share capital.
NQ Minerals (NQMI) increased lead concentrate production at the Hellyer mine from 5,452 tonnes in the second quarter to 6,656 tonnes in the third quarter, but zinc and pyrite concentrate production declined. However, recovery levels have improved for both lead and zinc.
BWA Group (BWAP) intends to sell its investments in Prepaid Card Services and a mining project in Cameroon. They are in the balance sheet at a value of £608,000. The focus will be gold explorer Kings of the North. St-Georges Eco-Mining is converting £300,000 of the £2.45m of convertible loan notes at 0.5p a share. This is equivalent to 23.75% of the enlarged share capital. The loan notes were issued to acquired Kings of the North Corp. BWA is still waiting for £88,000 of the £100,000 of convertibles issued for cash.
Black Sea Property (BSP) has published its 2018 accounts, but it will have to publish its interims before trading in the shares recommences. Management says that it is addressing the accounting concerns of its auditor BDO. The NAV was 0.95 cents a share at the end of 2018.
Asia Wealth Group Holdings (AWLP) reported a drop in revenues from $1.24m to $797,000. This meant that the company fell into loss. There is $726,000 in the bank at the end of August 2019.
Ganapati (GANP) improved its interim revenues from £2.19m to £2.33m, but higher admin expenses meant that the reported loss more than trebled to £8.5m. The company continues to develop its online gaming platform.
TechFinancials (TECH) has completed the sale of a loss-making asset for €100,000.
Queros Capital Partners (QCP) is asking shareholders to approve the ending of the NEX quotation. The general meeting will be held on 14 November.
AIM
Duke Royalty (DUKE) has made a follow-on investment in Lynx Equity, to help the company to finance the purchase of Denmark-based steel staircases supplier Sundby Trapper. This means that Duke has exposure of £12m in Lynx and it will receive annual distributions of £1.6m.
Space management software supplier Smartspace Software (SMRT) is paying £3.2m in cash and shares for Australia-based Space Connect, a provider of cloud-based workplace management software for room booking, desk management, catering and workspace analytics. This will save up to £1.2m a year on product development over two years. The software can be rolled-out in the UK. Smartspace made an interim loss of £4m.
An investor group intends to increase its stake in Petrel Resources (PET) from 29.99% to 51% via a share issue at 1.25p each. They will offer potential oil and gas-related investments to Petrel.
Cabot Energy (CAB) has decided to ditch its AIM quotation on 3 December, but it intends to have its shares matched on Asset Match. This will have to be approved by shareholders. The Canada-focused oil and gas company wants to reduce its overheads.
RedT Energy (RED) plans to merge with Avalon Battery Corporation and combine the best features of each company’s technology. Bushveld Minerals (BMN) is providing an interim loan facility prior to the raising of £23m of new funds.
Avingtrans (AVG) is already reaping the benefits of the acquisition of Booth Industries, thanks to a £7.2m safety doors contract from the government. That means that £12m of orders have been won since the purchase in June.
Safestay (SSTY) is buying a hostel in Athens for €1.5m. The hostel has been operating since 2008 and has an 18-year lease. Safestay has also completed the purchase of the Best Western Glasgow City hotel for £3.15m and this will be transformed into a 200-bed hostel.
MAIN MARKET
Stevia producer PureCircle (PURE) has won a legal decision in its patent litigation with SweeGen, which challenged the patent. It will pursue Federal District court litigation against SweeGen. The patent is for the process of producing Reb M stevia sweetener via bioconversion. The shares remain suspended because it has not published the results for the year to June 2019.
Meditor is considering a 5p a share offer for carpets retailer Carpetright (CPR) and without this offer thee would need to be a refinancing of £80m of debt and additional working capital.
Motor dealer Lookers (LOOK) has warned that its 2019 figures will be even worse than previously thought and chief executive Andy Bruce and chief operating officer Nigel McMinn have left the board. The pre-tax forecast has been cut from £38.7m to £15.5m, compared with £53.9m in 2018. Third quarter new car unit sales fell by 3.2% (on a like-for-like basis), compared with the market decline of 0.6%.
InnovaDerma (IDP) is launching a new topical product in Superdrug before the end of June. The full details will be announced nearer the launch.
The chairman and chief executive of Rainbow Rare Earths (RBW) have acquired 5.46 million shares at 3p each and they have a combined shareholding of 27.5%. Further cost reductions have been identified for the Gakara project in Burundi. A further 100 tonnes of rare earth oxides concentrate were shipped in October. Production levels will fall in the short-term as the production focus moves to a mechanised operation.
Cryptominer Argo Blockchain (ARB) has doubled its mining equipment order and changed the machines it is buying. The cost has been reduced from $13.1m to $9.51m. The machines are more efficient. The current machine orders will increase capacity by 240%.
Resources cash shell Mila Resources (MILA) is still seeking a deal. There was £429,000 in cash at the end of June 2019. Another shell, Bermele (BERM), is also still seeking a deal. It had £682,000 in cash at the end of July 2019.
Blencowe Resources (BRES) is acquiring the Orom graphite project in Uganda for £2m in shares at 6p each. This is subject to a fundraising.
Iconic Labs (ICON) slipped out its results for the 18 months to June 2019 at 6.28pm on 31 October. They show a £6.12m loss, of which, £308,000 was from continuing operations. Net liabilities were £1.67m.
Andrew Hore
Andrew Hore Quoted Micro 7 October 2019
NEX EXCHANGE
Wines and beer maker Chapel Down Group (CDGP) increased interim sales by one-fifth to £6.74m with growth coming from all parts of the business. Gross margins improved, but the first half loss increased due to investment in developing brands. Cash has been spent on developing additional vineyards, a gin works and a new brewery, although there is still £5.19m in cash on the balance sheet. Bank debt is £6.45m and this is associated with the Ashford brewery, where there have been teething problems with commissioning the new equipment. The associated restaurant and retail store opened in May.
Property investor Ace Liberty and Stone (ALSP) increased revenues by 44% to £5.07m in the year to April 2019. There was a disposal gain of £284,000 and that contributed to the rise in pre-tax profit from £361,000 to £759,000. Total dividends doubled to 2.5p a share. Property assets have increased by 52% to £88.3m. NAV is £21.2m.
Net assets of Western Selection (WESP) have fallen by one-third to 64p a share. The investment in loss-making Tudor Rose International has been written off. The value of the stakes in Bilby (BILB) and Brand Architekts (BAR), formerly Swallowfield, has fallen sharply. There is no final dividend.
IFA AFH Financial (AFHP) has confirmed that trading has been strong in the year to October 2019 and there will be a renewed focus on organic growth following a period of acquisition activity. There could be some small purchases, but there will be no requirement for cash from share issues.
KR1 (KR1) generated a gross profit of £5m in the six months to June 2019, although £4.29m of that is unrealised gains. The reported pre-tax profit is £4.62m. The NAV is £10.7m.
Dozens Savings (DSO1/DSO2) has had its 5% secured bonds October 2020 admitted to the NEX Exchange Growth Market. The bonds are offered to customers of parent company Project Imagine.
Angelfish Investments (ANGP) says that investee company YBOO has been placed in administration and Quantuma appointed to handle the process. Angelfish invested £650,000 for a 35% stake and lent just over £1m for working capital, where a repayment demand led to the administration. Writing down this investment was predominantly behind the £1.72m loss reported for the year to June 2019. It has also meant that there are net liabilities of £2.27m. A capital raising was hit by the closure of SVS Securities.
Shareholders in SG Recruitment (SGRL) did not approve the AGM reappointment of Steven Howson as a director. David Sumner, who owns the majority of the shares in the company, has been appointed chief executive.
Healthcare company MiLOC Group (MLP) increased its interim revenues from HK$5.27m to HK$6.1m. The loss was still substantial, although it did decline from HK$25m to HK$19.4m. The launch of a traditional Chinese medicine-based body care product should happen in the coming months. MiLOC raised HK$652,000 at 30p a share.
Cannabis company Freyherr International Group (FRYR) generated revenues of £1.17min the first half of 2019 and it should reach more than £2m for the full year. There was a small profit in the first half, which was before Freyherr joined NEX.
MESH Holdings (MESH) has left NEX. Veni, Vidi, Vici (VVV), Global Capital (GCAP) and Secured Property Developments (SPD) have all had trading in shares suspended because of a failure to publish accounts. Trading in Queros Capital Partners 8% bonds 2025 (QCP) has been suspended because of a breach of rules. This involves the failure to appoint new independent non-execs.
DXS International (DXSP) has appointed Hybridan as broker.
AIM
Directa Plus (DCTA) is paying €2.1m to acquire a 51% stake in Romanian waste management and remediation services company Setcar. A placing and one-for-38 open offer at 75p a share will raise up to £8.24m before expenses for the graphene business. GVC Investment Company, which has a business in offshore oil and gas services, will acquire 47% of Setcar with an existing shareholder retaining 1.97%. Directa Plus and Setcar have worked together on the development of Grafysorber mobile decontamination units. This is one of the two main focuses for Directa Plus. The other is textiles.
Linde is taking a 20% in energy storage and clean fuel products developer ITM Power (ITM) in return for £38m. The two firms are entering into a joint venture that will supply hydrogen to large scale industrial projects with an installed electrolyser capacity of 10MW and above. A further £14m is being raised at 40p a share, which is the same price that Linde is paying. An open offer could raise up to £6.8m.
Duke Royalty (DUKE) is raising up to £20m at 44p a share, including an offer via PrimaryBid.com. The cash will enable Duke to sign up another royalty partner and undertake five follow-on investments. The total cost will be approximately £25m. There will also be spare cash and facilities to sign up other royalty partners.
Trading in antimicrobial technology developer Byotrol (BYOT) shares has been suspended because it has not published its accounts for the year to March 2019. It blames the effects of revenue recognition policy IFRS 15 and the Medimark acquisition for the delay. The preliminary figures have been published and they were better than expected due to changes in revenue recognition related to IFRS15. Some revenues originally recognised in the year before has been moved to last year. Revenues increased from £1.8m to £5.7m, with £1.8m coming from Medimark, and Byotrol moved from loss to a pre-tax profit of £600,000. There was £2.8m in the bank at the end of March 2019. Even if there are no further licence deals this year, Byotrol should trade at around breakeven.
Evgen Pharma (EVG) says that the trial investigating the potential of SFX-01 to reverse acquired resistance to endocrine therapies. The data suggest that there are no safety concerns in patients suffering from ER+ metastatic breast cancer. In combination with endocrine therapy, SFX-01 helped to stabilise the disease and showed some anti-tumour activity.
STM Group (STM) says that the Pension Regulator has confirmed that Carey Workplace Pension Trust is an approved Master Trust for auto-enrolment. This means that STM is well-placed to become a consolidator in the market.
MAIN MARKET
Avation (AVAP) has repossessed two Airbus A321 aircraft from Thomas Cook and they are undergoing maintenance. They will subsequently be leased to other clients.
Flavourings supplier Treatt (TET) says it will achieve expectations in the year to September 2019 even though there has been a sharp fall in citrus raw material prices. Orange oil prices have halved, and this accounts for one-third of revenues. Non-citrus revenues are growing. Net cash is £15.8m. The full year results will be published on 26 November.
Andrew Hore
Andrew Hore Quoted Micro 17 June 2019
NEX EXCHANGE
Renewable energy supplier Good Energy (GOOD) says that holding back on operating expenditure has offset the downturn in demand due to warmer weather. Profit will be weighted to the first half. Good is investing in electric vehicle platform Zap-Map.
Brewer Daniel Thwaites (THW) reported a more than halved pre-tax profit from £9.8m to £4.5m. Turnover improved from £92.2m to £96.9m and the profit decline was mainly due to a non-cash swing from gain to loss on swaps and a pension adjustment. Operating profit was flat at £12.9m. The Inns business improved its profit and individual pubs are making a higher profit contribution, but hotels profit declined. The total dividend was maintained at 3.36p a share. Net debt was £69.7m at the end of March 2019, while NAV was £180.7m. The pension liability has fallen from £34.9m to £24.8m.
KR1 (KR1) has sold 70,079 tokens in the Cosmos Network for $361,000. The average cost of the tokens was $0.10 each and they were sold for $5.14 each. KR1 has also generate a further 7,008 tokens from staking activities and these were sold for $6.93 each.
There was a sharp rise in the share price of TechFinancials Inc (TECH) but much of this gain was lost by the end of the week. There does not appear to be a reason for the rise. Full year results should be published this week. There will be an operating loss. There was $1.1m in the bank at the end of May 2019. The company is still waiting for approval from the Seychelles authorities for the €100,000 disposal of MarketFinancials. There will be write-downs of the value of diamond trading blockchain developer CEDEX and MarketFinancials.
EPE Special Opportunities Ltd (ESO) had a NAV of 272.02p a share at the end of May 2019. The company intends to start buying back shares and these purchases could exceed 25% of the average daily volume of ordinary shares.
Shareholders have approved the plan of Oyster Oil and Gas to distribute the shares of its main subsidiary to settle indebtedness and certain creditors. These include Gunsynd (GUN) although the exact shareholding has yet to be announced. Production sharing contracts in Madagascar and Djibouti are owned by the subsidiary. Gunsynd has raised £500,000 at 0.037p a share.
Trading in Via Developments (VIA1) debentures has recommenced following the publication of figures for 18 months to September 2018. The company has net liabilities of £329,000 with long-term debt of £5.68m offset by cash of £91,000. A subsidiary is securing debt and equity for a project that will generate management fees fir Via, but that won’t happen until September.
Clean Invest Africa (CIA) is holding a general meeting on 3 July in order to gain shareholder approval for the acquisition of the 97.5% of Coal Tech and its related business that it does not own for £27.2m in shares at 2.75p each. CoalTech transforms discarded coal into coal pellets.
Lombard Odier sold 1.65 million shares in Chapel Down Group (CDGP) at 75p a share, reducing its stake to 11.5%. Chief executive Frazer Thompson exercised 2.39 million options at 12.5p a share and finance director Richard Woodhouse exercised 200,000 options at 10p a share and all these shares were sold at 75p each.
AIM
Frontier Smart Technologies (FST) has received another bid approach. Previous potential bidder Science Group (SAG) has built up a 28.3% stake in Frontier so it is in a strong position. It says that it does not intend to sell the shares to another bidder and could block any move to cancel the AIM quotation.
Park Group (PARK) increased investment in the business last year and this knocked underlying pre-tax profit progress which was flat at £12.5m, before asset write-downs. The dividend was increased by 5% to 3.2p a share. There was a smaller contribution from Christmas savings, but growth from corporate promotions and incentives offset that. Increasingly, business is card-based. There was £36.9m of the company’s own cash at the end of March 2019. There will be a dip in profit this year due to higher overheads and profit growth should resume in 2020-21. Chief executive Ian O’Doherty has bought 30,000 shares at 69.5p each.
Stanley Gibbons (SGB) has resolved claims against former management at antique dealer Mallett and this will result in a cash inflow of £850,000 over 12 months.
Safestyle (SSTY) has acquired the freehold of a 161 bed hostel in Pisa for €3.25m. This takes the company’s portfolio to 14 hostels, including the Paris site that is under construction.
Last year was about OnTheMarket (OTMP) building up the number of agencies on its property portal and increasing the number of homebuyers looking at the properties advertised. The rival to Rightmove and Zoopla needs to convert these agencies into fee payers and that process has just started. OnTheMarket will continue to be loss-making this year with higher marketing spending likely to offset higher revenues. Cash is expected to fall from £15.7m to £6.6m at the end of January 2019.
NWF (NWF) did better than expected in the year to May 2019. The feeds business was slightly behind the previous year, but new business helped the food warehouse business to significantly improve its performance and fuels did better than expected despite the milder winter, although behind the previous year. The results will be published on 30 July.
Industrial equipment distributor HC Slingsby (SLNG) says that pressure on margin means that operating profit in the four months to April 2019 is lower, even though revenues are slightly higher. Uncertainty over Brexit is affecting levels of demand in the first half of 2019. Net debt was £1.3m at the end of May 2019.
The actuarial deficit on the Molins UK Pension Fund has been cut from £69.9m to £35.2m over a three-year period. Mpac (MPAC) believes the deficit should be eliminated by July 2024. That is based on maintained payments into the scheme.
Filta (FLTA) says that its figures will be more skewed towards the second half. This is partly down to the integration of the Watbio grease management business. There has been growth in the FiltaSeal business and the North American FiltaFry fryer management franchise business.
Avingtrans (AVG) has acquired the Booth Industries specialist door manufacturing business from the administrator of Redhall (RHL) for £1.8m in cash. Booth made a pre-tax profit of £300,000 last year.
MAIN MARKET
Full year results from fasteners supplier Trifast (TRI) were slightly better than expected. Revenues were 6% ahead at £209m, while re-tax profit was a similar percentage higher at £23.5m. The dividend was increased by 10% to 4.25p a share. Trading remains tough.
Aquila Services (AQSG) has acquired education and sports consultancy Oaks Consultancy for up to £1.7m in cash and shares. In the year to March 2019, Oaks made a pre-tax profit of £254,000 on revenues of £909,000.
Bluebird Merchant Ventures Ltd (BMV) is converting $2.89m of loans into 121.5 million shares. Management made most of the loans and chief executive Colin Patterson will end up with 19.1% of Bluebird. Bluebird is debt-free.
Standard list shell Safe Harbour Holdings (SHH) lost £2.3m in 2018 due to overheads and due diligence costs. There is still £26.9m in the bank.
Andrew Hore
Andrew Hore – Quoted Micro 3 June 2019
NEX EXCHANGE
BWA Group (BWAP) has conditionally agreed to acquire share capital of a company with rights to five mining projects, predominantly in Quebec. The company is majority owned by Canadian Stock Exchange listed St-Georges Eco-Mining Corp and the total cost of the deal is C$7.5m (£4.3m). This will be paid in unlisted, convertible, interest-free loan notes. The repayment date will be three years after issue. The notes are convertible at 0.5p a share, or the market price of a share if it is higher. BWA will subscribe for C$300,000 (£170,000) of shares in St-Georges. BWA needs to raise at least £500,000 to go ahead with the deal.
Chapel Down Group (CDGP) increased 2018 sales by 10% to £13m. Turnover from wine and spirits and from Curious Drinks grew by similar percentages. However, a pre-tax profit of £253,000 to a loss of £850,000 as overheads were doubled to £5.57m. There is still £12.8m in the bank even though there was a cash outflow from operations and £8.37m of capital investment. There are 635 acres of vineyards that have been planted and a further 388 acres will be planted on the North Downs.
Wealth management firm AFH Financial (AFHP) increased interim revenues by 61% to £36.6m and underlying earnings per share were 49% higher to 14.9p a share. AFH continue to acquire IFA firms. Funds under management totalled £5.4bn and that is expected to nearly double within five years.
St Mark Homes (SMAP) has net assets of 130p a share, which is a discount of around one-third to the share price bid/offer of 85p/90p. The dividend was maintained at 5.5p a share, providing a yield of more than 6%. In 2018, revenues increased from £120,000 to £294,000, but underlying pre-tax profit declined to £80,000, because of higher overheads and a lower contribution from joint ventures. The regional housebuilder intends to release capital from existing developments to fund other opportunities in the outer London Boroughs.
Coinsilium (COIN) reported near-trebled revenues of £1.68m in 2018, but a pre-tax profit of £121,000 was turned into a loss of £982,000. That is due to much higher overheads and a £973,000 impairment of current assets. There was £592,000 in the bank at the end of 2018. Most of the revenues came from advisory services to blockchain companies. That business has moved to Gibraltar.
KR1 (KR1) made reduced realised gains in 2018 and there was an unrealised loss on investments, compared with an unrealised gain in 2017. The total pre-tax loss was nearly £11m. The NAV fell from £13.6m to £6.11m.
Capital for Colleagues (CFCP) increased the value of its investments by around £630,000, which reflects performance and prospects. Even without that unrealised gain, the loss declined. The NAV of the employee-owned businesses investor rose from 41.5p a share to 48.1p a share at the end of February 2019.
European Lithium (EUR) is commencing a drilling programme to confirm part of the inferred resource at the Wolfsburg lithium project in Austria. This data will be used in the definitive feasibility study.
In the six months to February 2019, Wheelsure Holdings (WHLP) reduced its loss from £181,000 to £126,000. Revenues remain small but they grew from £44,000 to £61,000. There were orders from Germany in the period, but Netherlands and Austria were delayed. Lower overheads helped to reduce the loss.
Cancer therapy provider Proton Partners International Ltd (PPI) generated revenues of £1.47m in the year to February 2019. There was cash generated from operations but that was dwarfed by £42.3m of capital investment. Additional cash has been raised since the year end.
In 2018, the revenues of Chinese treatments supplier MiLOC (ML.P) dipped from HK$11.6m to $10.7m, while the reported loss more than doubled to HK$37.9m. That was mainly due to a royalty fee related to AKFS Plus haircare brand. There was HK$2.75m in the bank at the end of 2018. Since then, HK$3.45m (£334,000) has been raised in a placing at 28.5p a share.
Cannabis investor Sativa Investments (SATI) has secured a commercial offtake agreement with a Portuguese supplier of cannabis oil. This will be included in products produced in Somerset.
Barkby Group (BARK) has secured a new six-year lease for the Rose and Crown Inn, near Swindon. This is the second lease from Arkell’s Brewery.
TechFinancials Inc (TECH) says 75%-owned Footies Ltd has completed its sports ticketing system demonstration product. This will enable it to approach potential football club clients. It is still hopeful that it can sign one up this year. Ian Ayre has stepped down from the Footies board.
Investment company Eight Capital Group (ECP) had net assets of £668,000 at the end of 2018. The investments include shell companies Abal Investments (ABAL) (formerly Imaginatik) and Sport Capital Group (SCG) which has net assets of £206,000 at the end of 2018.
Investment fund manager Startup Giants (SUG) still had £646,000 in the bank at the end of 2018.
Trading in the shares of Angelfish Investments (ANGP), London Capital Group (LCG), Black Sea Property (BSP) and Gamfook Jewellery (GAMF) is suspended because they have not published their 2018 accounts. Gamfook has replaced its auditor and will not publish accounts before the middle of July. Allenby has ceased to be nominated adviser and broker, as well as NEX corporate adviser, to PCG Entertainment. Trading in PCG shares is already suspended because of a potential reverse takeover.
AIM
Ramsdens (RFX) has acquired another four stores trading as The Money Shop and 12 loan books from Instant Cash Loans. This takes the number of stores acquired to 22 and the loan books to 17. Ramsdens says that there will be a small contribution to profit in the first year. The additional stores will be rebranded as Ramsdens and it has 163 stores. The 2018-19 figures will be published on 12 June.
Ideagen (IDEA) has gained a new £1.2m, three-year SaaS contract with an airline. The software will be used for safety incident reporting. Ideagen is expected to report a 2018-19 pre-tax profit of £12.2m.
Volvere (VLE) is returning up to £16.6m via a tender offer at 1290p a share, a premium of 12% to the market price when it was announced. Recent disposals have generated £25.6m, which took the cash pile to £36.2m. Management says it requires around £20m of cash for ongoing requirements.
Stride Gaming (STR) has received a bid proposal from Rank Group. A 151p a share offer is being considered. Stride floated four years ago at 132p a share.
TSX Venture Exchange company Hunt Mining Corp is offering 10.76 shares for each share in Patagonia Gold (PGD) and this values the target at £17.2m. The bid is recommended, and Patagonia shareholders will own 80% of the enlarged company. Hunt is producing silver and gold in Argentina and Patagonia has assets in the same region.
Nautilus Mineral Services (NAUT) wants to cancel its AIM quotation. A general meeting has been set for 24 June and shareholders owning 73.4% agree with the proposal. A matched bargain facility is planned.
Suits manufacturer Bagir (BAGR) still has not received the remaining cash investment of $13.2m from Shangdong Ruyi, which has requested an extension and wants to change the terms of the deal.
AfriTin (ATM) says that it expects to ramp up production at the Uis tin mine in the fourth quarter. The initial phase of the plant will be able to produce 60t/month of tin concentrate.
AssetCo (ASTO) says that Grant Thornton has been granted permission to appeal the judgment against it relating to the auditing of past AssetCo accounts.
Tavistock Investments (TAVI) has ended its strategic alliance with Lighthouse Group (LGT) because of the Quilter takeover of the IFA.
MAIN MARKET
Aptitude Software (APTD) plans to sell Microgen Financial Systems for £51m. Previously, this business was going to be demerged on AIM. There should be £48.4m after expenses and a majority of this will be returned to shareholders.
Standard list shell Fandango Holdings (FHP) has ended acquisition discussions with Konnect Mobile Communications because it could not raise the funds it required. There was £8,000 in the bank at the end of February 2019.
Novo Holdings has exercised its option to subscribe for 6.57 million Oxford Biomedica (OXB) shares at 690p each. Novo will own 10.1%.
Summerway Capital (SWC) had £5.69m in cash at the end of February 2019. Potential acquisitions have been identified.
Toople (TOOP) has raised £662,000 at 0.35p a share and it will use £150,000 as final settlement of £601,000 of loans from David Brieth. There was £1.15m in the bank at the end of March 2019. There was a cash outflow of nearly £1m in the previous six months. Last September’s placing was at 0.3p a share.
Cathay International Holdings (CTI) has been fined £411,000 by the FCA due to a breach of listing principles. These relate to the preparation of forecasts and monitoring of financial performance, as well as a failure to provide information in a timely manner. Chief executive Jinyi Lee and finance director Eric Siu were both deemed to be involved in the breaches but they are considering an appeal.
Andrew Hore
Andrew Hore – Quoted Micro 6 May 2019
NEX EXCHANGE
In 2018, Newbury Racecourse (NYR) increased revenues by 8% to £19.3m. This was despite lower race course attendances because of two abandoned days of racing. Underlying pre-tax profit jumped from £188,000 to £568,000. The NAV was £50.7m at the end of 2018. There was a further £3.25m payment from David Wilson Homes, which helped to finance capital investment.
MetalNRG (MNRG) has entered into heads of terms with AIM-quoted Mkango Resources so that it can earn up to 75% of the Thambi licence in Southern Malawi. The licence allows exploration for uranium, tantalum and niobium. MetalNRG has to spend $500,000 in the first 12 months and then a further $700,000 in the next 12 months. A further $800,000 has to be spent in the third year to earn the full 75%. The Kyrgyz Republic has banned uranium exploration and mining and the farm-in agreement for the Kamushanovskoye uranium deposit has been suspended.
Secured Property Developments (SPD) had a NAV of £554,000 at the end of 2018. There is £584,000 in cash on the balance sheet.
High Growth Capital (HASH) has raised £4.99m after expenses via a placing at 1.75p a share with Mirador FZE, which also has warrants to subscribe for 300 million shares at 2.5p each until the end of 2019. If the High Growth Capital share price closes above 4p for five consecutive days, the warrants have to exercised or they will lapse. Mirador has a 14.2% stake. Mike Power has been appointed as a non-executive director.
Sativa Investments (SATI) has opened the first Goodbody and Blunt centre in Bath. The centre will sell cannabidiol products and have a café area.
V22 (V22O) is asking shareholders to approve the cancellation of the NEX quotation 31 May, after nearly 13 years on the market. The art investor and studio space provider plans to sell assets and distribute the cash to shareholders. A matched bargains quotation via JP Jenkins is planned for six months after leaving NEX.
Trading in Valiant Investments (VALP) shares has been suspended because it has not produced its annual report.
Queros Capital Partners (BFD) has raised £205,000 in the past two weeks from the issue of 8% unsecured bonds 2025.
The shortlist for the NEX share of the year at the Small Cap Awards 2019 has been announced. The companies are National Milk Records (NMR), Sativa Investments (SATI), NQ Minerals (NQMI), Chapel Down (CDGP), DXS International (DXSP) and Walls and Futures REIT (WAFR) ,which is also on the shortlist for impact company of the year.
AIM
Capital equipment manufacturer Mpac Group (MPAC) is acquiring Lambert Automation for an initial £15m. UK-based Lambert provides automation equipment to the medical and healthcare markets. Revenues and profit have been declining, but there was an order intake of £24.5m in 2018 and that should help revenues to recover. Revenues were £17.9m in 2018. There is potential earn out consideration of up to £2.5m. Mpac’s own trading is in line with expectations.
Park Group (PARK) says that trading was better than expected in the second half of its financial year, but there were additional costs and the effects of accounting changes. Edison has reduced its 2018-19 pre-tax profit by 3% to £12.5m. Additional costs next year mean that the profit forecast has been cut from £14.3m to £11.7m.
Tracsis (TRCS) has acquired timetable optimisation software developer Bellvedi for an initial £4m with up to £7.9m more payable over four years depending on performance. Bellvedi made a pre-tax profit of £700,000 on revenues of £1.6m last year. Acquiring the ATTUne software means that less needs to spend on the development of existing Tracsis software. The deal adds 2% to this year’s earnings per share, moving it to 27.3p. Next year’s is enhanced by 7% to 32.3p.
Competitions organiser Best of the Best (BOTB) has published a fourth positive trading update in a year. This prompted finnCap to increase its earnings forecast from 15.4p a share to 18.6p a share. The previous upgrade was in January. The switch to a predominantly online model is paying off. Any upgrades to the forecasts for the year to April 2020 will happen after the 2018-19 figures are published on 20 June.
Allergy Therapeutics (AGY) says that the PQ Grass allergy phase III study will start a year later than expected. It should commence by June 2020. This follows an end of phase II study meeting with the FDA. This means that this year and next year the reported loss will be lower because of deferred spending on the study.
Eight Peaks Group (8PG) plans to cancel its AIM quotation because of limited liquidity. This will save £80,000 a year.
Trading in the shares of property investor Safeland (SAF) will end on 10 May.
MAIN MARKET
Motor dealer Pendragon (PDG) is selling two Jaguar Land Rover dealerships in California. This is expected to generate around £60m of cash, although £6.9m of profit contribution before central costs will be lost. However, Jaguar Land Rover has right of first refusal.
Papillon Holdings (PPHP) has appointed Novum as broker and it has committed to invest £300,000 in convertible loan notes. The planned purchase of a 50% stake in used car market focused fintech company Pace Cloud.
Ross Group (RGP) has reported its 2018 results, but these are before the completion of the Archipelago Aquaculture which happened early in 2019. Revenues fell from £335,000 to £60,000 and a profit of £57,000 was turned into a loss of £250,000. That is partly down to costs relating to the acquisition of Archipelago Aquaculture.
Thalassa (THAL) received acceptances of 18.5% of the share capital in its bid for Local Shopping REIT (LSR) and this offer has lapsed. Thalassa owned or had acceptances of 39.3%.
Standard list shell Bermerle (BERM) went to a 50% premium on the first day of trading. However, the bid/offer spread of 1p/2p means that investors could only sell at the 1p a share placing price. The company is seeking a pharma acquisition. The areas that Bermele is assessing include diabetes, cancer and mental health. It is also looking at personalised medicine.
Standard list shell Auctus Growth (AUCT) had £920,000 in the bank at the end of 2018. Fellow shell daVictus (DVT) had £355,000 in the bank at the end of 2018 and it has agreed to buy the rights to a restaurant concept from Typical Dutch NV for £100,000. The Havana Rolled Cigar Music Café concept has been developed at a site in Aruba. Spinnaker Opportunities (SOP) has also secured a possible acquisition in the form of Kanabo Research, which is a medicinal cannabis oil company. Kanabo is developing over the counter products and has distribution rights to a vaporiser. Spinnaker had £1.04m in the bank at the end of 2018.
Trading in the shares of Tex Holdings (TXH) and Avocet Mining (AVM) has been suspended because they have not published 2018 accounts.
Andrew Hore
Andrew Hore: Quoted Micro 29 October 2018
NEX EXCHANGE
Auxico Resources Canada Inc (AUAG) has added a NEX quotation to its year-old Canadian Stock Exchange listing. Auxico has mineral properties in Colombia and Mexico. There is already a UK investor base.
Chapel Down Group (CDGP) had a bumper 2018 harvest that was 125% ahead of the previous best, thanks to the hot summer. Some vineyards produced their first crops.
Ace Liberty and Stone (ALSP) is paying this year’s dividend in three instalments: October, April and July. The first interim will be 0.83p a share and the ex-dividend date is 25 October. The sale of Hume House in Leeds has been completed for £3.9m, compared to a cost of £1.67m in March 2014. A 37-storey building will be constructed on the site.
Eight Capital Partners (MORE) is investing £250,000 in AIM-quoted Imaginatik (IMTK) with £160,000 subscription for shares at 1.1p a share for a 29.7% stake, and £90,000 in convertible loan notes with an annual interest rate of 7.5%. Eight Capital is issuing up to £2.5m of convertible bonds at 95% of their nominal value. The annual coupon is 5%. One warrant will be granted for every two shares issued.
Trading in the shares of Etaireia Investments (ETIP) has been suspended ahead of a potential acquisition of property assets from the Oyston family.
Gunsynd (GUN) will get a 4% stake in Human Brands when, or if, it floats on the standard list. Previously it would have been a 1% stake. Gunsynd has £289,000 invested in drinks distributor Human Brands loan notes.
Founder Sebastian Snow has resigned as creative director of pubs and inns operator Barkby Group (BARK) and Lana Snow has also left the group. Occupancy rates were good in September and there is significant demand for the Christmas period.
Ganapati (GANP) reported a reduction in interim loss from £4.54m to £3.56m, although total income was flat at £2.19m. There was cash in the bank of £2m at the end of July 2018. This could be added to by an initial coin offering by Malta-based blockchain subsidiary GanaEightCoin Ltd next spring.
NQ Minerals (NQMI) has raised £81,250 at 15p a share to provide further working capital.
The chairman and chief executive of DXS International (DXSP) have both bought shares in the healthcare technology company. Bob Sutcliffe bought 100,000 shares at 8.515p each, while David Immelman bought 20,538 shares at 8.66p each, which takes the chief executive’s stake to 10.3%.
Sativa Investments (SATI) has signed an option on a 298,806 square foot glasshouse for growing medicinal cannabis. Mark Blower is becoming a non-executive director.
Melissa Sturgess has acquired 590,000 shares in Ananda Developments (ANA) at 0.4496p each. The executive director of the cannabis-focused investment company owns 47.8 million shares. Ananda joined NEX on 4 July having raised £930,000 at 0.45p a share. The share price ended the first day at 0.975p and it has more than halved since then.
AIM
Chris Marsh has resigned as finance director of Patisserie Holdings (CAKE) having been suspended on 9 October. Previously undisclosed LTIP share awards have been revealed.
GB Group (GBG) has acquired Australia-based ID verification services provider Vix Verify Global for £21m. This has led to a 2.7% upgrade in the 2019-20 forecast earnings per share. Third quarter trading of the existing business was in line with expectations with organic growth in revenues of 11%.
Avingtrans (AVG) is acquiring Texas-based Tecmag Inc for $243,000. Tecmag manufactures instrumentation for magnetic resonance imaging and nuclear magnetic resonance systems. This fits well with Avingtrans’ magnets business in the sector.
Energy supplier Yu Group (YU.) has shocked investors with accounting changes relating to accrued income and increases in impairment charges for trade debtors. This will slash £10m for this year’s profit turning it into a loss. There is £11.5m in the bank at the end of September 2018.
1Spatial (SPA) reduced its loss n the first half and is on course to cut its full year loss from £1.5m to £1m. The geospatial data services provider should move into profit next year.
HaloSource Corporation (HALO) says it has sufficient working capital until the end of the year, but up to $5m is required to add a further 12 months. The company expects to generate revenues of $2m-$2.5m in 2018 and the target is to treble that figure in 2019, which would reduce the loss.
EKF Diagnostics (EKF) says the record date for the distribution of shares in Renalytix AI is 23 October and the shares will start trading on 2 November.
Nexus Infrastructure (NEXS) expects 2017-18 profit to be in line with expectations and order books are strong. Infrastructure services provider Tamdown’s revenues will be slightly lower due to planning delays with the growth coming from utility connections business TriConnex. Net cash is £20m.
RA International (RAI) has won a $9.1m contract with URS Group Inc. This is a new client. The contract covers construction services for an asphalt runway in Somalia and lasts for 11 months.
Data analysis software and services provider D4T4 Solutions (D4T4) trebled its interim revenues to £14m, although the comparatives were weak. Net cash is £12.2m.
Gfinity (GFIN) is raising £6m at 8p a share and this cash will further develop the esports activities and the UK Elite series. The 2017-18 revenues were 82% ahead at £4.3m and losses continue.
Angling Direct (ANG) is taking advantage of its strong position in the fishing tackle retail market by raising £20m at 92.5p a share, which compares to the July 2017 flotation price of 64p a share. The cash will finance the opening of 20 stores and the launch of European websites. This accelerated investment means that Angling Direct will fall into loss this year.
Velocity Composites (VEL) has managed to trade in line with downgraded forecasts for the year to October 2018. Revenues will be slightly above £24m and there is net cash of £3.6m. The company is seeking a new chief executive and the former incumbent has left the board.
The cancellation of a contract and the failure to gain backing for an acquisition have hampered the progress of Image Scan Holdings (IGE) in the year to September 2018. Revenues fell from £5m to £3.5m, although the gross margin improved from 39% to 48%. Pre-exceptional profit will slump from £480,000 to £45,000. That was before the £245,000 cost of the failed acquisition. There was £780,000 in the bank at the end of September 2018. Sarah Atwell-King has been appointed finance director.
VR Education (VRE) has been hit by the delayed launch of its Titanic VR product on PlayStation. This should still happen this year, but 2018 revenues will be well below expectations. The timing of the launch will determine the outcome for the year. The ENGAGE platform will be launched before the end of the year as anticipated. Non-executive director Mike Boyce is helping out with sales.
SkinBioTherapeutics (SBTX) increased its research and development spending from £157,000 to £416,000 in the year to June 2018. The cosmetic application has started a human study and data should be available between November and April 2019. A clinical trial for an eczema treatment could start before the end of 2019. There was £3.2m in cash at the end of June 2018.
Rare books trader Scholium (SCHO) says it will move into loss in the first half, but it expects to make a higher full year profit than the £38,000 reported last year. Start-up Mayfair Philatelics is losing money but three auctions are taking place in the second half.
AfriTin Mining Ltd (ATM) is making progress towards production at its Uis tin project in Namibia. The first phase plant being constructed will be able to process 500,000 tonnes of pegmatite in order to produce 720 tonnes of tin concentrate a year. AfriTin has the cash required to reach production.
A strong performance from manned guarding meant that Croma Security Solutions (CSSG) increased its full year revenues by 59% to £35.1m and pre-tax profit was 400% higher at £2m. There were some one-off boosts during the year. Net cash was £2.1m. The dividend has been increased from 0.5p a share to 1.6p a share.
Property investment adviser First Property Group (FPO) has reduced its stake in Fprop Opportunities to 44.3% so it will no longer be consolidated in the group’s results. The plan is to lower the stake to below 30%. Fund management will be a greater contributor to profit.
More cash is required at meat and delicatessen products retailer Crawshaw (CRAW) for restructuring purposes and it also still needs a new nominated adviser.
Kemin Resources (KEM) will leave AIM on 29 October because it has not been able to find a replacement for Strand Hanson as nominated adviser. JP Jenkins Ltd will provide a trading facility.
OnTheMarket (OTMP) has signed up Belvoir Lettings (BLV) to its online platform. All Belvoir’s sales and lettings properties will be on the platform.
StatPro Group (SOG) says annualised recurring income has increased by 3% to £54.8m.
MAIN MARKET
Communisis (CMS) is recommending a 71p a share cash offer by consumer communications services provider OSG, which values the target at £153.8m. The combined business would be able to develop internationally because of OSG’s global strength.
WideCells Group (WDC) has signed a partnership deal with stem cell extraction and storage company Smart Cells. The deal is with the healthcare insurance subsidiary CellPlan, whose insurance plans will be offered to Smart Cells’ 60,000 clients.
Hemogenyx Pharma (HEMO) has signed a second agreement with US biopharma company Orgenesis Inc. The deal involves the development and commercialisation of the company’s Human Postnatal Hemogenic Endothelial Cell (Hu-PHEC) technology, which could develop cancer-free, patient-matched blood stem cells after transplantation into a patient. Like the previous agreement, Orgenesis will provide a convertible loan of $1m and this can be converted into shares in the Hemogenyx subsidiary that owns the technology. Orgenesis will pay a 12% royalty on net revenues generated by the technology.
North Midland Construction (NMD) says that full year revenues will be better than anticipated at between £340m and £345m, with net margins between 1.7% to 1.8%. The order book for delivery in 2019 is £222m. A new single identity for the group will be launched in November. HR director Karen Morris has bought 8,172 shares at 550p each.
