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Quoted Micro 18 September 2023
AQUIS STOCK EXCHANGE
An update on the Amapa iron ore project in Brazil from Cadence Minerals (LON: KDNC) says permitting times for the mine and related logistics should be reduced to 12-16 months. An environmental control plan is required to obtain the permits. This will enable a funding decision for the project. Investee company Hastings Technology Metals has expanded its offtake agreement with thyssenkrupp Materials Trading, which will take two-thirds of production from the Yangibana rare earths project.
Invinity Energy Systems (IES) has converted an existing order from Taiwan to its next generation Mistral flow battery. This is a higher margin product targeted at large wind and solar applications. Management is securing additional production capacity with Taiwan partner Everdura.
EPE Special Opportunities (ESO) had net assets of 308p/share at the end of July 2023. Investee company Rayware’s sales have been hit by weak consumer demand. Pharmacy2U continues to grow. Two investments have been sold. Ther was cash of £16.3m at the end of July 2023.
Financial services company Eight Capital Partners (ECP) says its 2021 figures have been restated because of a change in the accounting treatment of the bonds. Non-cash transactions have been removed from the cash flow statement. The book value of the bonds has been changed to fair value and a modified loss recognised on loan liabilities. Net liabilities were £11.4m. The 2022 results show net assets of £25.3m after a debt conversion to equity. A partial reversal of previous fair value adjustments also helped.
Coinsilium Group Ltd (COIN) is providing a convertible loan of $50,000 and has a 12-month option to subscribe for $500,000 for shares in Silta at a pre-money valuation of $7.5m. This means that it could end up with 6.7% of Silta. Last year, Coinsilium entered into an early contribution agreement to buy $75,000 of SILTA tokens. Silta is developing an advanced AI platform for sustainable infrastructure financing.
Hydro Hotel, Eastbourne (HYDP) is paying an interim dividend of 12p/share.
Rod Weinberg has reduced his stake in SulNOx Group (SNOX) from 6.35% to 2.49%. Macaulay Capital (MCAP) managing director David Horner has bought 200,000 shares at 22.5p each. Nigel Pope has taken a 3% stake in NFT Investments (NFT). Gathoni Muchai Investments has trimmed its stake in Marula Mining (MARU) from 12.2% to 11.26%. A warrants subscription at 4p each raised £30,500.
Black Sea Property (BSP) has raised €4.44m from a loan note issue, which is being used to pay for the recent acquisition of a majority stake in Grand Hotel Varna, which owns three hotels and a beach marina resort, plus a mutual fund portfolio. There is still €15.5m to pay.
AIM
Parcel delivery and logistics company DX (DX.) has received a bid approach from private equity firm HIG European Capital Partners. Gatemore Capital Management, which owns 16.8%, says it is willing to support the proposal of 48.5p/share. Management had rejected lower bids, but it would be minded to recommend this one. Due diligence will be required.
Online gaming firm Gaming Realms (GMR) reported interim revenues 35% higher at £11.5m and a 74% increase in pre-tax profit to £2.4m. The licensing business drove the growth. North American revenues increased by 47% and there are more states likely to ease restrictions on online gaming. Growth is coming from moving into new markets and adding new games. There are upfront costs to the expansion, holding back short-term profit. Net cash is expected to be £8m at the year end
Iodine producer Iofina (IOF) increased interim revenues by 27% to $24.3m, while pre-tax profit improved from $2.6m to $4.7m. First half iodine production was 242Mt. Iofina commenced production at its IO#9 plant in Oklahoma at the end of the half year. This is the sixth plant in operation and will help boost second half production to 325-350Mt.
Contract research and infectious disease study services provider hVIVO (HVO) is moving into larger London premises in Canary Wharf. The latest interims have led to an upgrade of guidance for the full year and hVIVO intends to pay a nominal dividend for 2023. Interim revenues were £27.3m, up from £18m, and the full year outcome is expected to be £55.1m with most of the rest of the revenues already contracted.
Construction and property software supplier Eleco (ELCO) increased like-for-like interim revenues by 5% to £13.5m. More importantly, recurring revenues were 18% ahead at £9.7m. This indicates the success of the move to SaaS-based revenues which has held back progress in the short-term. Net cash could reach £10.8m by the end of 2023.
Mkango Resources (MKA) subsidiary HyProMag, which is a short loop rare earth magnet recycler, is participating in a grant funded project called RE-RE Wind, which is designed to provide a circular supply chain for rare earth magnets for wind turbines. The first generation of wind turbines are coming up to the end of their life and a decommissioning programme is required.
Payments services provider Cornerstone FS (CSFS) made a small maiden interim profit. The move into profit was earlier than expected. Interim revenues were 90% ahead at £3.6m and most of this is direct business rather than through third parties. The overheads were held down enabling more of the additional revenues to flow through to profit. Cash is being generated from operations.
Online gaming company B90 Holdings (B90) has raised £2m at 5.44491p/share. The cash will go towards funding acquisitions and further investment in existing assets. The company is also converting £4.73m of loan notes and interest into 86.8 million shares. Enwys, which acquires customers for online gaming companies, has been bought. There are more than 20 other acquisition targets.
Keystone Law (KEYS) is paying a special dividend of 12.5p/share on top of the interim of 5.8p/share. Underlying pre-tax profit was one-quarter ahead at £5.7m, while net cash was £11.3m at the end of July 2023. Interest from new principal lawyers is increasing and 25 offers were accepted in the first half. There is plenty of back office capacity for additional lawyers.
Communications technology developer Feedback (FDBK) is taking time to secure new deals, but they should be on the horizon. The community diagnostic centres contract with the Queen Victoria Hospital has been delayed, but hopefully it should be secured by the end of the year. Feedback is still loss making, even though full year revenues were 74% ahead at £1.02m. The cash outflow, including capitalised development costs, was £3m and the £7.3m in the bank should last more than two years.
North Sea oil and gas producer IOG (IOG) has been told by the authorities that the Nailsworth P2342 and P130 licences are not going to be extended and this could have a negative commercial impact on the potential for the Elland licence. Bondholder discussions continue and the waiver lasts until 29 September. There was £14.5m in cash at the end of August, including £7.3m of restricted cash. There was stable production from Blythe H2, but the realised gas price was lower.
The Property Franchise Group (TPFG) has offset lower revenues from property sales by increasing lettings revenues. Overall interim revenues were 1% ahead at £13.2m. The higher tax rate meant that earnings slipped 2% to 13.8p/share despite an increased profit. The interim dividend was increased by 10% to 4.6p/share.
US-focused betting company Sportech (SPO) plans to leave AIM. It says the burden of time and money is too great. A circular will be sent out to gain shareholder approval at a general meeting.
Bushveld Minerals (BMN) has signed a binding term sheet for a potential $69.5m-$77.5m investment by Southern Point Resources. This includes the acquisition of 50% of Vanchem and 64% of the Mokopane project, plus a $12.5m investment in Bushveld Minerals. There will also be a working capital facility provided. Southern Point Resources will take over marketing and sales of vanadium and other products. The stake disposals will lead to a book loss of $59.6m.
Animal feed ingredients supplier Ocean Harvest Technologies (OHT) raised interim revenues by 43% to €1.8m and gross margins jumped to 36%. Investment in marketing and other aspects of the business meant that the loss was flat at €1.3m. These additional costs should help to generate further sales growth of its seaweed-based feed. Field trials could add up to €13m to annual revenues. However, delays in these trials mean that full year revenues have been downgraded from €4.3m to €3.4m. There should be net cash of €2.9m at the end of 2023.
MAIN MARKET
The FCA has approved the takeover of Lookers (LOOK) by Alpha Auto Group. The bid is 130p/share.
On The Beach (OTB) says its full year results will show record revenues and the holiday company says pre-tax profit will be at the top end of expectations. In the year to September 2022, revenues were £144.1m, which was slightly higher than the pre-Covid level of £140.4m, and underlying pre-tax profit was £14.1m. Consensus forecasts for 2022-23 were revenues of £179.5m and pre-tax profit of £22.6m. The guidance suggests that profit should be slightly higher than that. Even so, underlying pre-tax profit in 2017-18 was higher at £27.6m.
Andrew Hore
Quoted Micro 20 February 2023
AQUIS STOCK EXCHANGE
EDX Medical Group (EDX) acquired Torax Biosciences for the issue of 1.67 million shares at a notional 6p each. Torax provides development and pilot scale fabrication of immunochemistry-based assays and diagnostic testing services. The experienced team at Torax was an attraction.
Marula Mining (MARU) signed a co-development and relationship agreement with a subsidiary of South African mining and investment company Q Global Commodities, which had already agreed to subscribe £3.75m for shares. Q Global chief executive will become Marula Mining chairman, subject to regulatory approval and admission to AIM. Marula Mining is expanding its graphite interests through the proposed purchase of a 75% stake in ten licences comprising the Nyorinyori graphite project in Tanzania.
Electric vehicle drivetrains developer Equipmake (EQIP) reported more than halved interim revenues from £2.32m to £1.05m and the loss increased to £2.76m. There was cash of £7.44m at the end of November 2022. The contracted order book is worth £9.1m. That includes 100% of second half expected revenues as well. There have been delays in delivering vehicles to First Group, so these will be in the 2023-24 figures.
Energy supplier Good Energy (GOOD) has launched a new smart export product for Feed-in Tariff for FiT customers, which could help them to earn more from electricity they generate. There are plans for a new domestic export tariff for households in the next few months.
AQRU (AQRU) has incorporated the London Carbon Exchange and it has a wating list of investors interested in using the platform when it is launched later this year. The platform allows trading in the voluntary carbon market.
RentGuarantor Holdings (RGG) has entered a three-year agreement with X1 Property Management, a residential and student letting company, which hopes to generate secure tenants.
Digital asset investor Kasei Holdings (KASH) raised £500,000 at 12p a share from Aalto Capital. This is a 12.5% stake. ChallengerX (LON: CXS) raised £250,000 through a share issue to Aalto Capital at 0.45p a share. An equal number of warrants exercisable at 0.45p each were also issued.
Spirits company Rogue Baron (SHNJ) non-exec Charlie Wood acquired an initial 600,000 shares at 0.846p each. He also has an interest in the 1.1 million shares owned by Orana Corporate, where he owns 25%.
Hikmat El Rousstom has resigned as non-exec director of Ace Liberty & Stone (ALSP), while at British Honey Company (BHC) Sophie Guifang Luo stepped down from the board to pursue other interests.
Love Hemp (LIFE) has withdrawn from trading on the Aquis Stock Exchange as of 14 February. Trading in Pioneer Media Holdings Inc (PNER) will end on the Aquis Stock Exchange on 9 March.
AIM
Purplebricks (PURP) is launching a strategic review because the board believes the company is undervalued. The share price slumped to 7.86p, which is a new low. Changes to the estate agency business have disrupted the third quarter performance. Instruction numbers were lower than expected. Management has identified an additional £4m of annualised cost savings. There will be £1.2m of one-off costs in the second half. The full year adjusted EBITDA loss will be between £15m and £20m. It was previously expected to be around £10m.
Semiconductors designer EnSilica (ENSI) moved into operating profit in the first half and momentum has continued in the second half. A €5m contract has been won to develop a chip for the satellite communications market, which will start generating revenues in 2023-24. Interim revenues are nearly one-quarter higher at £8.59m. The growth came from design and supply. There was a pre-tax loss of £202,000, but R&D tax credits meant that there was a £322,000 profit after tax. A small full year pre-tax loss is forecast for the full year with a £844,000 post-tax profit.
Semiconductors designer Sondrel Holdings (SND) says the project design for a customer in the automotive sector has been delayed because project design will not be completed until the first quarter of this year. The payment for the first milestone was in January and the second will not be until May. The 2022 loss is higher than forecast and there will still be a small loss in 2023.
Esports company Gfinity (GFIN) raised £2m at 0.15p a share, having originally sought £1.5m. The cash should last for 12 months. Technology platform Athlos still requires a strategic partner and there is enough funding for this for around four months. If not, then it could affect the restructuring and other plans for the rest of the business. At 0.1575p, down 33%, the current share capital is valued at Gfinity at £2.1m. Each placing share comes with a warrant to subscribe for one share at 0.15p and these warrants are exercisable between six and 18 months after the placing shares are admitted to AIM.
Fertiliser producer Harvest Minerals (HMI) had cash of A$2.72m at the end of 2022. Sales of KPFertil are growing and that has enabled the repayment of A$1.2m of debt. A court ruling requires Agrocerrado to pay $463,000, because it failed to acquire the minimum tonnes of KPFertil required by the agreement between the companies.
Medical devices developer Creo Medical (CREO) raised £28.5m from the placing at 20p a share, which was more than the £25m initially targeted. The cash will be used for further development and commercialisation of Creo Medical’s minimally invasive electrosurgical devices. With up to £5.2m more to come from the open offer, Cenkos believe that this is enough cash to fully commercialise the current product portfolio. Revenues of £100m are forecast by 2027.
Clontarf Energy (CLON) is forming a joint venture with US-based NEXT-ChemX Corporation, which covers the deployment and marketing of the latter’s direct lithium ion extraction technology in Bolivia. There is limited water and energy consumption with this technology. The share price soared by 129% to 0.172p. Pilot testing and extraction starts in March. Clontarf Energy will contribute $500,000 towards the pilot plant for exclusive use of the technology. There will also be share issues to NEXT-ChemX.
Promotional goods supplier software platform provider Altitude (ALT) says results for the year to March 2023 will be much better than expected. Zeus has upgraded its pre-tax profit forecast from £500,000 to £800,000 and that is the second upgrade in three months.
Deferral of contracts by clients has led to forecast downgrades for Jaywing (JWNG) and 2022-23 pre-tax profit expectations have been more than halved to £1m, while next year’s forecast has been slashed from £3.7m to £2m. The digital marketing services provider won an Australian online education services contract which will help to offset some of the decline in forecast revenues in 2023-24.
Mkango Resources (MKA) raised £3.5m at 12.5p and this will fund further development of the Songwe Hill rare earths project. Talks with potential funders for the project continue. Mkango Resources will also provide a €2.5m loan facility in HyProMag, which is developing a rare earth recycling production facility in Baden-Wurttemberg. The company’s stake in HyProMag could increase to 66.8%. Chief executive William Dawes acquired 400,000 shares at 12.95p each and 400,000 shares at 12.75p each. He owns 4.42%
WH Ireland has reduced its forecasts for SaaS-based retail software provider itim Group (ITIM) because of contract delays. Revenues for 2022 will be slightly below previous forecasts and that increases the loss by £200,000 to £1.1m. The 2023 loss is expected to be the same. Annualised recurring revenues are £13m, which is lower than expected. Net cash is £3.9m.
Mark Horrocks has increased his stake in cloud-based international payments services provider Cornerstone FS (CSFS) from 8.66% to 13.4%.
Dekel Agri-Vision (DKL) achieved record local process for its crude palm oil in January and there were strong extraction rates from the fruit bunches. However, there were disappointing volumes because of aggressive rival bidding for fruit bunches, although this has eased this month. There no changes to 2023 expectations of a sharp rise in profit.
MAIN MARKET
The ignominious life of Hawkwing (HNG) as a quoted company appears to be coming to an end. Kroll Advisory has been appointed administrator to the company. Hanover Investment Management demanded repayment of £2.2m relating to a convertible loan note. Hawkwing is owed £13.7m plus interest and add-ons by IFG (SPP), where liquidators have been appointed. This is secured on two subsidiaries and their assets, but it is uncertain how much can be clawed back. The cash shell was formerly sports representation and marketing company TLA Worldwide, a past AIM embarrassment which released a profit warning after the market had closed for Christmas.
Zamaz (ZAMZ) has acquired Dallatte Italia, a manufacturer of dairy products. This fits with the Bella Dispensa subsidiary and its Made in Italy ecommerce service. Management wants to change the terms of its bonds by extending their life and increasing the interest rate.
Trading in Net Zero Infrastructure (NZI) shares recommenced last week following publication of accounts and interim figures. The share price fell from 2.2p to 1.55p.
RC365 Holding (RCGH) intends to issue 18 million shares to Hatcher Group Ltd and in return it will receive 38.64 million shares in Hatcher Group. The two firms will collaborate in research and development of smart algorithm technology and other fintech services.
Andrew Hore
Quoted Micro 18 July 2022
AQUIS STOCK EXCHANGE
Hydro Hotel, Eastbourne (HYDP) increased interim revenues by 882% to £1.82m and this enabled a move from a loss of £383,000 to a pre-tax profit of £22,277. There are cash and deposits of £1.8m.
Hydrogen Utopia International (HUI) has announced a proposed joint venture with AIM-quoted Powerhouse Energy (PHE) in Tipperary, Ireland. This will be a 50/50 joint venture and it will build a plant on a site leased by Trifol Resources. Negotiations concerning the site should be completed over the coming months. Electron Technologies BV has completed the first design phase for the company’s thermal processing system.
AQRU (AQRU) has launched ByBrix in partnership with Blimp Technologies Inc. This new business is involved in the crypto-mortgage market. Blimp has expertise in embedding blockchain technology in the real estate market.
Goodbody Health Inc (GDBY) intends to consolidate ten existing shares into one new share.
Reflexivity Research Ltd has increased its stake in KR1 (KR1) from 7.6% to 20.3%. This relates to a performance fee of £30.1m.
IPGL Ltd, which is associated with Chapel Down Group (CDGP) non-exec Samantha Wren, has acquired 250,000 shares in the wine maker at 19.2795p each. Cadence Minerals (KDNC) chief executive Kiran Morzaria bought 100,558 shares at 9.9p each. This takes his stake to 1.43 million shares. Invinity Energy Systems (IES) executive director Jonathan Marren has acquired 44,101 shares in the battery storage technology developer at 45.35p a share.
Oscillate (LON: MUSH) non-exec Narisha Ragoonanthun has stepped down from the board.
Lift Global Ventures (LFT) has appointed Optiva Securities as corporate adviser. The accounting reference date is changed from May to June.
EPE Special Opportunities Ltd (EO.P) had net assets of 283.05p a share at the end of June 2022.
AIM
Capital equipment manufacturer Mpac Group (MPAC) warned that full year profit will be significantly below expectations. Interim revenues are better than last year, and the order book is higher. However, difficulties sourcing components and delays to the timing of orders have hampered progress. The longer lead times for components and inflationary pressures will continue for the rest of the year. There was cash of £14.5m at the end of 2021, which has enabled investment in inventories. The interims will be published on 8 September.
CMO Group (CMO) slumped to 35p after a profit warning, making it the worst AIM performer of the week. Last year’s placing price was at 132p. The online retailer of building products says revenues in the 27 weeks to June 2022 are 10% ahead, or 2% higher like-for-like. Full year guidance is that 2022 revenues will increase from £76.3m to at least £86m, but previously £95.5m was expected. The EBITDA estimate has been reduced from £5.55m to around last year’s level of £3.7m. Supply problems have increased costs and trading is getting tougher.
TransGlobe Energy Corporation (TGL) is merging with fully listed VAALCO Energy (EGY) to create an Africa-focused exploration and production company. VAALCO is offering 0.6727 of one share for each TransGlobe share. TransGlobe shareholders will own 45.5% of the enlarged group. The transaction is valued at $307m.
A positive first half trading statement from international payments services provider Cornerstone FS (CSFS) initially triggered a bounce back in the share price, but it fell back when the chief executive resigned.
Embedded computer boards supplier Concurrent Technologies (CNC) has received a new order from a global medical technology company. The initial order is worth $2.2m in the first year of product shipments and there should be orders for several years. This further diversifies the customer base away from defence, which was 70% of the revenues of £20.5m in 2021.
Angle (AGL) has raised £20m at 80p a share. The cash will be used to take full advantage of the recent FDA approval for the use of its Parsortix diagnostic technology in harvesting breast cancer cells for analysis. Discussions are ongoing with medtech and pharma companies. The pharma services operation will be expanded, and laboratory developed tests launched. The liquid biopsy market could be worth up to $100bn in the US.
A £3.75m fundraising at 0.5p a share by EQTEC (LON: EQT) was not well received by the market and the share price fell below the offer price. EQTEC raised more than the minimum of £3m that it was seeking. The cash will fund wase to energy projects, including a 9.9Mwe advanced gasification technology facility and 2MW anaerobic plant at Deeside. EQTEC has to invest £2.3m to gain a 32% stake in the company owning the project.
Ironveld (IRON) has raised £4m at 0.3p a share to finance the acquisition and refurbishment of Ferrochrome Furnaces Ltd and may raise up to £1m more. Directors’ loans and fees of £351,000 has been capitalised. Management has raised the cash because it is not certain that Grosvenor Resources will be able to complete the promised cash injection. Shareholder approval is required at a general meeting on 1 August.
Portmeirion (PMP) says interim revenues were 5% ahead at £45m, but it remains cautious about the full year. Shipping costs are reducing, although other costs have risen.
Gaming machine monitors and consoles supplier Quixant (QXT) has increased order intake by more than expected. Interim revenues are 46% ahead at $53.3m. The main growth is in the gaming sector, although the screens business grew by 21%.
Regional legal firm consolidator Knights Group Holdings (KGH) reported full year figures in line with expectations. Revenues were 22% higher at £125.6m, although earnings per share fell nearly 6% to 17.23p because more shares are in issue.
Plant-based polymers developer Itaconix (ITX) increased interim revenues by 124% to $3m. Revenues trebled from cleaning products using the company’s plant-based ingredients, but beauty and hygiene revenues declined due to lower order volumes. There was $900,000 of net cash at the end of June 2022.
MAIN MARKET
Property investor Town Centre Securities (TOWN) is selling its stake in YourParkingSpace app for up to £20.7m. The initial payment is £9.6m with a further £7.5m payable over the next two years. There could be up to £3.6m more payable depending on performance in the 14 months after acquisition. The book value of the stake was £1.47m. A loan of £1.95m will be repaid. A tender offer to acquire four million shares at 185p each has been launched. The tender is well below NAV. Tender forms have to be received by 8 August.
BATM (BVC) has secured a deal with CityFibre, which will pilot the Edgility platform with selected partners. This could lead to a national roll-out. CityFibre wants to increase its fibre coverage to 285 cities in the UK.
Andrew Hore
Quoted Micro 17 January 2022
AQUIS STOCK EXCHANGE
Failed bidder Ecotricity has requisitioned a general meeting at Good Energy (GOOD) in order to remove Will Whitehorn as a director and to stop the company selling generating assets without shareholder approval. The meeting will be held on 11 February. Ecotricity owns 25% of Good Energy. The sale of the generating assets is an important part of the company’s strategy. The cash would be used to reduce borrowings and invest in newer businesses, such as Zap-Map and other digital businesses.
Samarkand Group (SMK) has signed an exclusive distribution agreement with AIM-quoted Venture Life (VLG). The e-commerce technology platform will be the exclusive distributor of mouthwash Dentyl Dual Action and halitosis mouthwash Ultradex in China for an initial term of five years.
Hydrogen Utopia International (HUI) has signed a letter of intent with RZZO, which is a regional municipal waste management company in Ostrow Wielkopolski in Poland. RZZO will provide a plot of land where a HUI waste plastic to hydrogen plant can be sited and also source the plastic waste. They will seek funding from the EU as well as Polish grants. The heat would be fed into a district heating system.
Eastinco Mining and Exploration (EM.P) has identified 11 new pegmatite zones at its HCK joint venture in Rwanda. These are potential tantalum-niobium bearing zones. The sampling should be completed in February.
Apollon Formularies (APOL) has signed agreements with more than a dozen cannabis cultivators. They all have the appropriate licences. It has also set up the Apollon Kannabiz Cooperative to work with local Jamaican farmers. Rod McIllree has been appointed as a non-exec director. He owns 29.1% of Apollon.
Western Selection (WESP) cut its stake in Northbridge Industrial Services (NBI) from 9.65% to 6.21%, while Harwood Capital has raised its stake to 16.9% to 20.4%. Western Selection raised £1.7m from the disposal.
EPE Special Opportunities Ltd (ESO) had net assets of 510.95p a share at the end of 2021.
Sativa Wellness Group Inc is changing its name to Goodbody Health Inc (GBDY).
Dispersion Holdings has changed its name to AQRU (AQRU), which is aligned with the brand of its retail online platform for lending cryptocurrencies.
Rutherford Health (RUTH) will leave Aquis on 25 January.
AIM
Frontier IP (FIPP) says the increase in the value of tis stake in the Nasdaq-listed Exscientia will be an important component of the rise in NAV at the end of 2021. NAV was 69.8p a share at the end of June 2021. A small portion of the shareholding has been sold and further sales are likely. This cash can be ploughed back into Frontier IP and help with new investments.
Legal services provider Gateley (GTLY) reported organic growth of 23% in the six months to October 2021. That partly reflects the weak comparative figures as well as underlying growth. All four divisions grew revenues with only the property division having a small contribution from an acquisition. Utilisation levels improved from 79% to 84%. Underlying pre-tax profit increased from £7.5m to £8.5m. The interim dividend was one-fifth higher at 3p a share. Management is seeking acquisitions to add to organic growth. There is normally a second half weighting to the figures.
Strong trading at Metro Rod and Metro Plumb is the major factor behind the growth at Franchise Brands (FRAN) and the B2C franchise brands are recruiting more franchisees. Full year pre-tax profit is expected to increase from £4.8m to £6.4m. Net cash was £8.6m at the end of 2021.
Corporation Financeiere Europeenne acquired shares in CIP Merchant Capital (CIP) taking its stake to 31.8%. This has sparked a mandatory bid at 55p a share. This is a substantial discount to net assets of 87.6p a share. The plan is to save the costs of being a quoted company.
Cornerstone FS (CSFS) has come to an agreement with Robert Lee concerning the £100,000 convertible loan facility he had promised. Instead of being convertible at a fixed price of 61p a share the convertible could be converted at the average mid-market price of the shares for the five dealing days prior to the drawdown of the loan if this is lower. This will mean that it is much more dilutive unless there is a sharp rise in the share price. The international payments company says 2021 revenues should be £2.3m with more generated by direct sales.
Specialist IFA Frenkel Topping (FEN) is paying up to £10m for Cardinal Management, which provides patient support at hospitals following traumatic events. This provides access to potential clients at an early stage.
Heart disease risk assessment technology developer GENinCode (GENI) has filed a pre-submission for its Cardio inCode-SCORE test with the FDA in the US. This will provide information ahead of a future marketing application. The test combines genetic risk with clinical risk to assess an overall risk of heart problems for a patient.
Oil palm plantations operator Dekel Agri-Vision (DKL) generated record figures in 2021. December crude palm oil production more than doubled and the total production for the year was 39,953 tonnes, up 17.5% on the previous year. Extraction rates are starting to improve. The average crude palm oil price was $868/tonne, which is 44% higher than in 2021. The crude palm oil price is currently more than $1,000/ tonne
Minds + Machines (MMX) decided to return the remaining cash to shareholders and cancel the AIM quotation. There will be 10.4p a share tender offer.
Vector Capital (VCAP) has increased its debt facilities by £5m to £35m. In 2021, the total loan book rose by 27% to £46.3m. This is ahead of expectations.
Capital equipment supplier Mpac Group (MPAC) says it traded in line with expectations in 2021. A pre-tax profit of £8.2m is forecast. The closing order book was £77m. The 2021 results will be published on 14 March.
Holders Technology (HDT) is paying a special dividend of 2p a share on 28 January in addition to a final dividend which will be announced with the 2021 figures. The interim dividend was 0.5p a share. This follows the disposal of some of the company’s PCB assets for around £1.7m.
Mosman Oil and Gas (MSMN) has dropped its plans for a 100-for-one share consolidation after negative feedback from shareholders.
MJ Hudson (MJH) has gained a multimillion contract to advise the ACCESS local government pension scheme over a seven-year period. This covers eleven local authority pension schemes. They have £35bn in pooled assets.
MAIN MARKET
Cash shell Electric Guitar (ELEG) joined the standard list on 11 January. It raised £1.2m at 3p a share and the share price has risen to 3.7p. The current NAV is 1.78p a share, which is effectively all cash. Electric Guitar is a shell seeking acquisitions in the digital advertising sector. There could be opportunities to consolidate smaller agencies. A suitable target will be run by management with a good record, be involved in growth areas, have good quality clients, an existing IT platform and be scalable. It should be near to cash generation. The company acquired would have an enterprise value of at least £5m.
East Star Resources (EST) has gained readmission to the standard list following the acquisition of Discovery Ventures Kazakhstan. A placing raised £3.1m at 5p a share.
Canadian Overseas Petroleum (COPL) has made a significant oil discovery in Wyoming. The discovery has between 1.5 billion and 1.9 billion barrels of oil in place.
PYX Resources Ltd (PYX) has begun sales of rutile from its Mandiri deposit in Indonesia with production of ilmenite and leucoxene starting later in the year.
One Heritage Group (OHG) is acquiring Seaton House in Stockport for £675,000. This is an office building, and the plan would be to convert it into up to 30 apartments. The gross development value is £5.6m.
Andrew Hore
Andrew Hore – Quoted Micro 26 July 2021
AQUIS STOCK EXCHANGE
Ecotricity has launched a 340p a share cash bid for Good Energy (GOOD). Ecotricity believes the combined group would be better placed to compete in the energy supply business. The Good Energy board rejects the bid.
Arbuthnot Banking (ARBB) reported a bounce back in interim pre-tax profit from £200,000 to £3m. the main profit improvement was at Arbuthnot Latham. NAV was 1292p a share at the end of June 2021. Assets under management reached £1.22bn. A second interim dividend of 16p a share was announced, and it will be paid on 24 September.
NQ Minerals (NQMI) says its Hellyer gold mine generated revenues of A$19.8m in the second quarter, while net income was A$5.7m. The major capital investment in the mine cost A$16.4m and was finished during the quarter. NQ Minerals is still seeking to move to a full listing on the London Stock Market.
Sativa Wellness Inc (SWEL) generated record revenues in the first half of 2021, and it is generating cash from operations. CBD products supplier Goodbody Botanicals is profitable. There have been 47 clinics opened to offer Covid-19 testing.
Apollon Formularies (APOL) says that medicinal cannabis formulations developed by its subsidiary have been able to kill prostrate cancer cells.
Watchstone Group (WTG) management recommends that shareholders reject the mandatory 34p a share bid.
Ervin Kovac has resigned as director of Freyherr International (FRYR) and the shares remain suspended as the company’s financial position remains uncertain. Trading was suspended more than nine months ago.
Harry Hyman has taken a 3.08% stake in Oberon Investments (OBE).
Newbury Racecourse (NYR) is moving from the Access segment to the Apex segment.
AIM
Digital payments business Boku (BOKU) increased interim revenues by 37% to $34m – organic growth was 21%. Investment is increasing in order to take advantage of growth prospects, but cash is also increasing.
Trading is improving at employee benefits services and insurance products provider Personal Group (PGH) and interim revenues were 12% ahead at £34m even though weak insurance sales last year mean that premium income fell. SaaS-based revenues increasing by 50% – helped by the partnership with Sage. Sales of consumer electronics products through PG Let’s Connect has improved by one-fifth.
Insolvency levels remain relatively low, but Begbies Traynor (BEG) still grew strongly last year. In the year to April 2021, underlying pre-tax profit improved from £9.2m to £11.5m – a combination of organic and acquisitive growth. There is more to come this year from recent acquisitions.
Lawyer Gateley (GTLY) managed to increase its pre-tax profit from £18.1m to £19.3m despite the tough trading conditions in the year to April 2021. The property and corporate finance divisions did particularly well last year. This kept utilisation levels high. A final dividend of 5p a share was announced. Gateley is paying £815,000 for Tozer Gallagher, which is a quantity surveyor and construction consultant.
Online womenswear retailer Sosandar (SOS) increased its full year revenues by 35% to £12.2m. It remains loss-making and that is likely to continue this year even though revenues continue to grow rapidly. First quarter revenues jumped by 256% to £5.7m, although the comparatives were weak. Active customers increased by 23% compared with the previous quarter. Singer forecasts double full year revenues to £24.4m.
Parcel and freight delivery company DX (DX.) is still growing its freight business faster than expected and analysts have upgraded their forecasts for 2020-21 and the current year. The additional business is also more profitable than in the past. DX Express revenues are flat due to lower office mail delivery revenues.
Judges Scientific (JDG) had a much better order book at the end of June 2021. It was 49% higher than June last year. Organic sales growth was 5% compared with full year forecasts of 1.5%.
Open Orphan (ORPH) spin out Poolbeg Pharma (POLB) has started trading on AIM. The shares are trading at 10.875p, which is equivalent to 3.63p a share to Open Orphan shareholders. The Open Orphan shareholders cannot sell yet.
Vela Technologies (VELA) has invested £750,000 in Northcoders Group, which joins AIM on 27 July. Manchester -based Northcoders provides software coding training.
International payments business Cornerstone FS (CSFS) is pursuing potential acquisitions, but it has not secured any since it floated earlier this year. The mix of business remains consistent, although more of it is direct which improves margins, and trading has almost returned to pre-pandemic levels.
MAIN MARKET
New shell Acceler8 Ventures (AC8) has soared from its placing price of 100p to 215p on limited volumes. After expenses, the cash in the company is equivalent to 60p a share. The sector of the potential target has been kept vague.
Sivota (SIV) is a shell that wants to acquire Israel-based technology businesses. The company has just under 78p a share of cash. The share price has risen from the placing price of 100p to 112.5p.
NMCN (NMCN) is making progress with the refinancing and related documentation. The 2020 accounts are expected to show a pre-tax loss of much more than the £24m previously indicated.
Aquaculture technology developer OTAQ (OTAQ) increased full year revenues by 18% to £4.05m, while the underlying loss was reduced from £1.05m to £726,000. Restrictions have held back the progress of the business.
Town Centre Securities (TOWN) has collected 88% of the billed rent of £4.9m for the quarter to June 2021 with a further 8% that was agreed to be deferred.
Andrew Hore
