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Andrew Hore: Quoted Micro 4th June 2018

 NEX EXCHANGE

Stratmin Global Resources which was quoted AIM until August 2017, is expected to join NEX on 6 June.  Stratmin lost the AIM quotation because it failed to complete a reverse takeover, partly due to the fact that it was waiting for a promised investment. Stratmin is still in the process of completing the acquisition of Australian gold explorer Signature Gold, which would be paid for by the issue of 450 million shares at 2p each. After the deal, the company will change its name to Tectonic Gold.

Ananda Investments is the latest cannabis-focused investment vehicle to be joining NEX. The pre-money valuation is £500,000 and the minimum fundraising is £750,000. Ananda is willing to raise up to £4m. There are already potential investments being assessed. A reverse takeover valued at up to £10m appears most likely.

AfriAg Global (AFRI) says that 40%-owned AfriAg (Pty) Ltd increased its net profit from £104,000 to £179,000. This was equity accounted by AfriAg Global and the £72,000, up from £42,000, contribution helped offset the operating loss from the agricultural logistics group’s operations. The overall loss increased from £9,000 to £38,000. AfriAg (Pty) Ltd had the right to take a 60% stake in House of Hemp but this deal was terminated when the South African government delayed setting up the legal framework for medicinal cannabis. Focus has turned to other countries.

KR1 (KR1) generated gains of £4.3m on its trading in digital coins and tokens during 2017. There was also a total unrealised gain of £10.8m on these investments and a £1.18m foreign exchange gain. The total pre-tax profit was £14.5m, with a tax charge of £2.87m. That tax charge is included in trade creditors due within one year of £4.21m. There is cash in the bank, but total current assets were £3.5m. A creditor has subsequently been paid with £79,000 of shares, issued at 10p each. The KR1 share price has more than quadrupled over the past year and there is regular daily trading in the shares.

Workspace provider and art collector V22 (V22) reported a 2017 pre-tax profit of £175,000, down from £1.01m the previous year. The profit included a gain on the sale of an option to acquire one of the company’s buildings. The NAV is £1.34m, equivalent to 4.26p a share. That increases to 8.68p a share if the company’s art collection is revalued. The shares are trading at 2.95p (2.7p/3.2p).

Housebuilder St Mark Homes (SMAP) reported a reduction in pre-tax profit from £652,000 to £384,000 in 2017. There was a reduction in revenues from £1.34m to £120,000 and the share of operating profit from a joint venture was more than halved. There was cash in the bank of £514,000 at the end of 2017. St Mark has raised £3.47m from a 6% bond. This cash will be invested in new projects. The NAV is 134p a share, compared with a share price of 95p (90p/100p).

Peru-based gold and silver producer VI Mining (VIM) reported a tripled loss of $6.33m for 2017. No revenues were generated and the NAV was $2.56m. That was before VIM acquired two projects for $51.3m and raised £5.35m at 500p a share.

Georgia-focused oil and gas company Block Energy withdrew from NEX on 23 March and it is set to join AIM on 11 June. It will be valued at £10.3m at 4p a share.

MetalNRG (MNRG) has identified an acquisition that could provide the opportunity to move to the standard list.

Iran-focused investment company Indigo Holdings (INGO) is reviewing its strategic options. Hamish Harris and Nicholas Harwood are stepping down from the board.

First Sentinel (FSBN) generated initial revenues of £156,000 but, even excluding admission expenses of £65,000, it lost £117,000 in the 15 months to December 2017. The NAV of the small company adviser and investor was £1.26m at the end of the year. Since then, a further £1.5m has been raised via a convertible bond.

Formation Group (FRM) fell back into loss in the six months to February 2018. Revenues fell by 15% to £17.2m and there was s wing from a pre-tax profit of £15,000 to a loss of £277,000. The loss was greater than the second half loss last year. The NAV is £9.95m, including £3.2m in cash.

Secured Property Developments (SPD) has received repayment of the loan it made to a developer of a retail scheme in York. This cash will be used to finance any property deals that management feel are good value, thanks to more realistic pricing.

Trading in the shares of DagangHalal (DGHL) and Equatorial Mining and Exploration (EM.P) have been suspended. DagangHal has failed to publish its 2017 accounts. Equatorial is in negotiations with South African mining company ARQ Minerals, which intends to invest £50,000 for 500 million shares. This has led to a delay in the publication of accounts.

Walls and Futures REIT (WAFR) has appointed Allenby to replace City and Merchant as its corporate adviser.

AIM   

Nexus Infrastructure (NEXS) had already warned that its TriConnex utility connections business was suffering from delays and even so interim figures showed a 4% rise in revenues to £62.9m and a 15% increase in pre-tax profit to £3.4m. The interim dividend was raised by 5% to 2.2p a share. Delays to the commencement of projects continue but the group order book has increased to more than £234m.

RedstoneConnect (REDS) is selling its systems integration and managed services businesses for £21.6m, so that it can concentrate on its software for smart buildings. The cash raised will pay off existing debt. Last year, the software division had revenues of £5.3m and made an operating profit of £1.4m.

Maritime monitoring equipment supplier SRT Marine Systems (SRT) has raised £3m at 25p a share and it is swapping £1.15m of short term loan notes for new three year loan notes. The cash will finance systems projects and product development. SRT is working on projects worth £30.5m.

A positive AGM statement from Parity (PTY) confirms that the trading of the consultancy and staffing divisions is going well. Parity should be cash positive by the end of the year and there is a strong pipeline of potential business.

Fishing tackle retailer Fishing Republic (FISH) increased revenues by 58% to £9.15m, but it slumped into loss. Trading was weaker than expected, particularly in the fourth quarter, and gross margin fell sharply even before stock write-offs. Fishing Republic has relaunched its website and the review of operations is ongoing. Five stores have been closed, reducing the total number to 14.

Share (SHRE) increased its revenues by one-fifth in the first quarter as the services provided for Computershare make a contribution in the full quarter. Broker commissions increased by 27% on the back of a 5% increase in trading volumes. First quarter market share dipped from 3.66% to 3.54%. An upgrade to the website has been completed.

Itaconix (ITX) is restructuring its UK operations in order to focus on core products. The main focus will be the US polymer operations. The annual fixed cost base will fall to less than £3.5m in 2019.

IDOX (IDOX) has appointed David Meaden as chief executive. He has experience of the public sector and software development. The information management software and services provider has closed its loss-making digital division. Underlying EBITDA is likely to be in the range of £13m-£15m for the full year, compared with previous expectations of £22.8m. Excluding digital, the EBITDA will be between £18m and £20m.

Immupharma (IMM) has further analysed the results of the phase III lupus treatment trial for Lupuzor. There were different results in the European and US parts of the trial with antibody positive patients in Europe showed a statistically significant improvement.

MAIN MARKET    

Haynes Publishing (HYNS) expects to report a better than expected full year profit. Underlying pre-tax profit will be 10% ahead at around £2.9m. Earnings per share will be hit by US tax changes.

Falcon Media House (FAL) has decided to leave the standard list. The digital media group says that the share price fall has hampered its ability to raise more cash to develop its Q-Flow technology. Revenues have not come through as quickly as expected. If cash were raised, it could reduce the free float so the shares would be suspended.

Andrew Hore

Quoted Micro 30 October 2017

NEX EXCHANGE

The government proposal to drop plans to cap housing benefit in the supported living sector to Local Housing Allowance rates is good news for Ashley House (ASH) because the rates would not have been viable. Ashley House has development schemes that could go-ahead following the change of government plans. There could still be other proposals that hamper development in the government paper on funding supported housing that is due to be published on Tuesday but if there are not then Ashley House is in a good position.

Belvedere Capital has subscribed for £31,500 of convertible loan notes in Forbes Ventures (FOR) and the investment is expected to increase to up to £100,000. The initial cash will pay creditors and enable Forbes to issue its interim figures. That is required for trading in the shares to recommence. The interest rate is 1% per month and the conversion price is 0.1p a share. A representative of Belvedere, which is focused on technology investments in northern England, will join the Forbes board as an executive director.

First Sentinel (FSEN) has made a £625,000 investment in standard-listed Curzon Energy (CZN). The shares in the oil and gas company were acquired at the flotation price of 10p each but the share price has fallen back to 8.38p. Curzon has a coal bed methane asset in Oregon.

Middle East-focused investment company Indigo Holdings (INGO) has made four investments, although one of these was earlier this month so it is not included in the balance sheet to the end of June 2017. There was still nearly £241,000 in the bank, prior to investing £10,000 in 3sootjobs, a job search platform in Iran.

Supported housing developer Walls and Futures REIT (WAFR) has been granted membership of the Social Stock Exchange. Management hopes that this will help the company attract investors seeking investments with a positive social impact.

Black Sea Property (BSP) has completed the €10.5m purchase of the UniCredit Bulbank office building in Sofia.

AIM

A management review at Real Good Food (RGD) has uncovered further disappointment and there will be a loss this year. All three divisions are growing their sales with overall like-for-like sales 13% ahead but this is not translating into higher profit. A combination of higher commodity prices and disruption from capital investment. Overheads are being reviewed and Real Good Food is also racking up costs relating to its corporate governance problems. The head office is being moved from London to Liverpool. New banking covenants have been agreed but the further downgrades could mean they come under pressure but the food company has the backing of its three main shareholders.

Investment in European distribution centres and a new UK head office held back the first half progress of musical instruments retailer Gear4Music (G4M) but the benefits will start to show through in the second half. There was a small loss in the first half but a full year pre-tax profit of £2.4m is forecast as European sales build up and margins start to recover.

Stratex International (STI) is holding a general meeting requisitioned by shareholders, including AnglGold Ashanti and Teck Resources, on 1 November. The requistioners, which own 24% of Stratex, want to remove the current chairman and chief executive and block the proposed reverse takeover of Brazil-focused Crusader Resources, which was announced in May. They want former Stratex directors David Hall and Paul Foord to return to the board. The two men run Thani Stratex Resources Ltd, which is 30%-owned by Stratex. Institutional Shareholder Services Inc advises voting against the resolutions. Stratex has the backing of shareholders owning 12.1% of the share capital. Earlier this month, Stratex sold its 13.7% stake in Goldstone Resources for £550,000 (1.6p a share).This was valued in the latest accounts at £950,000.

Datatec (DTC) is dropping its AIM quotation and concentrating on the JSE listing. There has been a lack of interest in the shares in London with non-South African investors trading through the JSE. The cancellation becomes effective on 8 December.

It appears easier to push a piano up a steep flight of stairs than for TLA Worldwide (TLA) to bring out its 2016 accounts. The latest management estimate for publication is before the end of November. Former CFO Don Malter is said to have misappropriated $800,000 of funds over three years. It is unclear if any of this is included in the $6.8m EBITDA adjustment for 2016 that was revealed in June. TLA remains best known for publishing a profit warning at 6.26pm on 23 December 2016. It will be interesting to see whether the accounts are published before this date and time in 2017.

Lombard Risk Management (LRM) had a tough first half but it expects to do much better in the second half and move back into profit. Interim revenues fell by 16% as risk management software sales fell. Regulatory reporting software sales improved. A full year profit of £1.8m is forecast.

Zinc Media (ZIN) has acquired Tern Television Productions for up to £5.45m, with up to £2.35m deferred. Tern made a pre-tax profit of £300,000 on revenues of £5.3m in the year to March 2017. Tern specialises in factual programming. A placing at 0.9p a share raised £3.5m.

Systems1 Group (SYS1) had a poor first half with revenues falling and costs increasing. The market research firm reported a 10% decline in interim revenues to £13.8m and a 70% slump in pre-tax profit to £540,000. There was still £3.5m in the bank at the end of September 2017. Rebranding and reorganisation hampered the business at a time when clients were also holding back spending.

Fox Marble (FOX) has sold the first polished marble slabs from its factory in Kosovo. This sale was part of the agreement to supply Marble Dino. Fox recently signed a three year agreement to supply OM Enterprises in India. An advance payment of $500,000 has been received.

Third quarter trading at broking business Share (SHRE) continued to be strong and revenues were 29% higher compared with the third quarter of 2016. Market share jumped to 13.9%.

A new finance director has reviewed the forecasts for Attraqt Group (ATQT) and problems in timing of contracts have been identified. This means that revenues will be 10% lower than expected in 2017, although there will be organic growth. There was £2.3m in the bank at the end of September.

Hardide (HDD) has raised £2.54m at 1.7p a share in order to fund an increase in reactor capacity. Two additional reactors will be installed in the US and other equipment will be installed in the UK and US. The surface coatings business has signed a framework agreement with a North American oil and gas business. Full year figures will be published on 11 December.

Botswana Diamonds (BOD) expects major developments over the coming months. There is enough cash to last into 2018. An inferred resource is expected to be reported for the Thorny River project before the end of the year. Eight kimberlites have been discovered at the Free State project.

Ascent Resources (AST) is raising a further £1.5m via PrimaryBid.com. Ascent is a regular user of the crowdfunding site. The shares will be issued at 1.66p each. Ascent is awaiting a signature on a government document that will enable it to export gas from Croatia.

Internet gaming software-as-a-service provider GAN (GAN) will benefit from the final approval of a bill in Pennsylvania that legalises real money online gaming. The regulated gaming is expected to start early in 2018.

Cenkos has lowered its revenue expectations for Collagen Solutions (COS) following a trading statement. It has knocked £400,000 off its 2017-18 revenues forecast and trimmed forecasts for later years. A profit is not anticipated until 2019-20. First half revenues of the collagen products supplier were flat.

K&C REIT (KCR) is raising £150m at 100p a share, following a ten-for-one share consolidation. The name is being changed to KCR Residential REIT and a move to a premium listing is planned.

The Ottoman Fund Ltd (OTM) has repatriated cash from Turkey and shut three Turkish subsidiaries. This is an important step in winding up the company returning cash to shareholders. The final distribution will be in the range of 1.36p a share to 1.53p a share.

Stellar Diamonds (STEL) has been granted an environmental licence for the Tongo project in Sierra Leone.

MAIN MARKET

Fuel cell technology developer Intelligent Energy Holdings (IEH) is selling its business and being wound up. Convertible loan note holders are likely to get 65% of the principal of the loan notes prior to their cancellation but ordinary shareholders will get nothing. Cash is likely to run out in November. Meditor Energy is paying £19.5m for the remaining business and this will be used to pay the 65% of principal of the loan notes. A Meditor fund owns 85.5% of these loan notes.

Orient Telecoms (ORNT) is a new standard list company that wants to start a telecoms business in Singapore from scratch. The share price ended the first day at 11p (10p/12p) and it remains unchanged since then. The shares are tightly held so any trading activity could push up the share price, so beware of this lack of liquidity. There does not appear to have been any trading activity, as yet.

Aquila Services Group (AQSG) is acquiring development consultancy and financial modelling services business pod. The business made an operating profit of £162,000 on annual revenues of £1.09m. This fits with the group’s affordable housing services operations.

Andrew Hore

Quoted Micro 16 October 2017

NEX EXCHANGE

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

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

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

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

AIM

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

MAIN MARKET

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

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

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

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

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

Andrew Hore

Quoted Micro 5 June 2017

NEX EXCHANGE

National Milk Records (NMRP) is raising £7.33m at 65p a share in order to help finance the withdrawal from the Milk Pension Fund. Like Genus, National Milk Records was part of the Milk Marketing Board and that is why it has part responsibility for the Milk Pension Fund. There will be a one-off contribution of £10.1m to the fund and £4.68m will be paid in cash and shares to Genus. National Milk Records is also selling its loss-making generic products reseller Inimex to Genus for a nominal amount and entering a collaboration agreement with the animal genetics company. There would be a requirement to finance the fund up until 2076 if the deal does not go ahead. A New Zealand-based farmer cooperative and Singapore-based fund manager Working Capital Management are among the investors subscribing for the shares.

Contemporary art collector and workspace provider V22 (V22O) moved into profit in 2016. The £1m profit was helped by a £225,000 gain on the sale of half of the option to acquire part of the freehold of its Peckham building and a £225,000 notional gain on the remaining option. There was also other operating income of £621,000. Stripping these items out, there would have been a slightly higher loss. Revenues grew from £822,000 to £1.24m. There was £64,000 in the bank at the end of 2016. NAV, including a valuation of the art portfolio, is 7.31p a share. Demand for studio space is strong at a time when it is become less affordable. This puts V22 in a strong position. V22 has agreed a ten year lease on premises in Shoreditch and is the preferred bidder for a 125 year lease on The Priory in Orpington.

Blockchain-focused investment company Coinsilium Group Ltd (COIN) has raised £250,000 at 2.2p a share to finance further investments. In 2016, Coinsilium increased revenues from £12,000 to £209,000. There was a total loss of £738,000, including a £317,000 loss on disposals and investment impairments of £160,000 – admittedly down from £1.31m the previous year. The NAV was £1.43m at the end of 2016.

Kryptonite 1 (KR1) is also seeking blockchain investments. This includes subscribing for shares in Satoshipay. It has also invested in five initial token offerings and three of them are already being traded and have performed well.

London Nusantara Plantations (PALM) is selling its stake in Next Oasis for £124,000. This was in the 2016 balance sheet at a valuation of £112,000 and the proceeds will boost the 2016 cash pile from £83,000. London Nusantara has been quoted for three years and it is still seeking to acquire plantation assets and it has widened its geographic search to Indonesia, as well as considering the palm oil mill sector and generating income from oil palm waste.

Early Equity (EEQP) has signed a memorandum of understanding with Malaysian multi-level marketing business Early Infinity, which has a distribution agreement with healthcare products supplier Yicom, where Early Equity owns 32.1%. The plan is for Early Equity to buy up to 30% of Early Infinity. Trading in Early Equity shares has been suspended.

Ganapati (GANP) has obtained a class 4 gaming licence in Malta and this should widen the potential market for its games. A tech office has been set up in Romania.

Halal services provider DagangHalal (DGHL) has raised £3.1m at 26.5p a share and this will leave managing director Francis Chong with a 29.9% stake. Revenues fell last year and there were significant asset write downs.

Middle East-focused investment company Indigo Holdings (INGO) had £906,000 in the bank at the end of 2016 and it raised £818,000 in February. Around £650,000 of that cash has been invested in three companies.

Restructuring and slow LED product sales meant that Gowin New Energy Group Ltd (GWIN) reported a slump in revenues from RMB652,000 to RMB28,000, while the loss was RMB6.94m. There is RMB2.08m of cash in the bank but there is more than that figure in shareholder loans because of the significant cash outflow during the year.

MiLOC Group Ltd (ML.P) increased its revenues from HK$8.31m to HK$10.9m in 2016 and the loss fell from HK$17.1m to HK$11.5m. The company’s clinics and traditional Chinese medicines generate the revenues and the TCM PLUS skincare products are expected to make a substantial contribution in the future. Last year, there was a large one-off cost relating to TCM PLUS. A hair care range is planned.

Equatorial Mining & Exploration (EM.P) intends to apply for a small scale mining lease for a coal mining prospect in Nigeria. Equatorial lost £1.55m in 2016 but £1.24m of this was a non-cash share-based payment charge. The cash outflow from operations was £383,000. Brett Clark has stepped down from the board following the failure to secure the acquisition of a Mexican gold project.

Healthcare staff provider Healthperm Resourcing Ltd (HPR) reported a £3.1m loss on revenues of £2,000 for 2016 but the business should generate more significant revenues this year. Steve Howson has become chief executive, while the former incumbent David Sumner became non-executive co-chairman. Two groups of overseas recruits have started work in the UK.

Ecovista (EVTP) has raised £470,000 via an issue of convertible loan notes. The conversion price is 0.05p a share. Any loan notes not converted will be repayable on 30 May 2018. Ace Liberty and Stone (ALSP) has raised £64,500 from a placing at 75p a share with most of the shares bought by Bijan Daneshmand, thereby taking his stake to 5.16%.

NQ Minerals (NQMI) lost £2.39m in 2016 but this was before the acquisition of the Hellyer gold mine in Tasmania. The main asset of All Star Minerals (ASMO) is its stake in NQ Minerals. This stake was valued at £414,000 at the end of 2016. The 2016 loss was £187,000, including a £28,000 write down in the NQ Minerals stake.

AIM

Touchstone Innovations (IVO), the former Imperial Innovations, has rejected the bid from rival University-focused technology businesses developer IP Group. The initial approach was made in April and some major shareholders were keen to pursue the merger. The main problems concerned valuation and corporate governance.

It does not appear that Tanfield Group (TAN) is going to be able to sell its 49% stake in access platforms manufacturer Snorkel in the near future because it continues to lose money. The value of the stake in the books is £36.3m – equivalent to 23.2p a share. This value can be achieved if Snorkel makes an annualised trailing EBITDA of $25m in any 12 month period up until September 2018. However, Snorkel is losing money and after September 2018 there is no fixed amount that Tanfield would receive if it sold its stake. Jon Pither has stepped down from the Tanfield board.

Acoustic insulation manufacturer Autins Group (AUTG) has appointed Michael Jennings as chief executive. He has been interim chief executive since February. Interim figures will be published on 13 June.

Draganfly Investments (DRG) has appointed mining engineer Luke Bryan as executive chairman. Edward Bayman will step down as chairman but continue on the board.

Hostels operator Safestay (SSTY) is planning to buy three hostels from Equity Point. The hostels are in Barcelona, Prague and Lisbon and they generate revenues of €1.6m. Safestay is loaning €3.6m to Equity Point and the plan is to swap the hostels for this debt.

Stanley Gibbons Ltd (SGI) has sold its 25% stake in Masterpiece London for £1.4m. The stake was valued in the books at £6,000. This is part of the strategy to focus on stamps and coins.

A general meeting has been requisitioned at Magnolia Petroleum (MAGP) in order to make changes to the board. At the end of May, Nostra Terra Oil & Gas (NTOG) acquired a 10.9% stake in Magnolia from former chief executive Steven Snead but the requisitioner has not been named.

Adams (ADA) has launched an underwritten one-for-one open offer to raise £1.03m at 2.5p a share. The investment focus is the technology and life sciences sectors. Richard Griffiths, who owns 29.9% of Adams, is underwriting the open offer. The announcement says that Adams has four AIM-quoted investments but only one of the companies mentioned, Oxford Pharmascience, is on AIM the others are fully listed.

TLA Worldwide (TLA), which published a profit warning at 6.26pm on 23 December 2016, thinks that it will be able to report its 2016 figures on 30 June. It will need to do this or trading in the shares will be suspended. TLA has warned that it will have to write-off some of the money owed to it.

Pembridge Resources (PERE) plans to move from AIM to the more lightly regulated standard listing. This will enable it to be more flexible in what it invests in and the level of stakes that it acquires. The main hurdle for a standard listing is getting the prospectus approved by the UKLA. Once that is done companies do not have the level of regulation they would if they were on AIM.

MAIN MARKET

Second half trading has been strong for car manuals publisher Haynes Publishing (HYNS). Pre-tax profit is expected to be two-fifths higher than last year. Haynes has benefited from lowering its costs and positive exchange rate movements. The new Haynes OnDemand video service will be launched this year but there will be a write down of the costs of the previous platform in the 2016-17 figures. The full year figures will be published on 13 September.

Telecoms services provider Toople (TOOP) is trying to raise up to £2m because it is running short of cash. Members of the PrimaryBid crowdfunding platform have been offered the chance to subscribe for shares at 2p each. A minimum of £1m needs to be raised. Even if the maximum is raised then the cash is unlikely to last long unless the cash outflow is stemmed in the near future.

Acorn Growth has changed its name to Vordere (VOR). This follows the proposed acquisition of German properties, which will be paid for by a share issue at 17p each. The shell company was originally known as Acorn Minerals when it joined the standard list at a placing price of 20p a share in October 2012.

Andrew Hore

Quoted Micro 1 May 2017

NEX EXCHANGE

Cyber security technology developer and consultancy Crossword Cybersecurity (CCS) continues to scale up its business and there is a product launch planned for this summer. In 2016, revenues jumped from £21,000 to £345,000 but the loss increased from £755,000 to £950,000 – even after £78,000 of R&D tax credits. There was £1.55m in the bank at the end of 2016. AIM-quoted Iomart is cooperating with Crossword on launching the Nixer machine learning DDoS platform on the market.

Brewer Adnams (ADB) says sales of beers and spirits continue to grow and its pubs are trading well, although the sale of smaller pubs will reduce the profitability of this part of the group. Currency movements, the sale of the UK distribution rights for Lagunitas beers and the renovation of the Swan Hotel will hamper overall progress in the first half. The £7m investment in the brewery is almost complete.

Sandal (SAND) has signed an agreement with Spanish smart home technology business Momit, which will redesign its smart thermostat so that it is compatible with the Energenie MiHome platform. This is part of Momit’s strategy to enter the UK market. The redesigned product should be launched in September and, along with related radiator valve sales, could add £500,000 to the annual revenues of Sandal.

Healthcare staff provider Healthperm Resourcing Ltd (HPR) has revised its strategy and candidates need to have passed the International English Language Testing System, which is required for a visa anyway. Healthperm has opened its own IELTS training facility in the UAE and this is focused on nurses. Healthperm has won two new mandates and there are three other potential mandates on the cards. Chief executive David Sumner has agreed to increase the maximum amount of loan notes he will subscribe for from £1m to £1.8m. The loan notes have a 10% interest charge.

Capital for Colleagues (CFCP) has raised £1.44m at 42p a share from its open offer and a further £980,000 in a placing at the same price. Coinsilium Group (COIN) has raised £118,000 at 2p a share and it will use £60,000 to finance the development of a blockchain-based management system. Goldcrest Resources (GCRP) is raising £380,000 at 0.5p a share. The cash will help to finance the competent persons report on the Norio block, which the company is in the process of acquiring.

NQ Minerals (NQMI) has entered into a A$6.5m loan facility to help finance the acquisition of the Hellyer gold mine in Tasmania. This means that NQ has A$15m of the A$20m in cash it requires to make the purchase.

Indigo Holdings (INGO) is investing £200,000 in Iranian Fast Moving Consumer Goods Ltd, an online retail delivery business associated with a convenience store chain.

Ashley House (ASH) has secured a £500,000 loan facility from its non-executive deputy chairman Stephen Minion. The secured facility lasts for 12 months.

Housebuilder St Mark Homes (SMAP) has appointed Alfred Henry Corporate Finance as its corporate broker. Merchant Place had performed this role for 18 years.

AIM

Mortice (MORT) has made a second UK acquisition. The facilities management services provider is paying up to £4.5m for Elite Cleaning and Environmental Services – £3.5m in cash and shares plus a 12-month earn-out of up to £1m in cash and shares. Elite provides cleaning services and clients include ITV and BMW. Elite made EBITDA of £1m on revenues of £12.3m. finnCap has increased its earnings forecast by 5% to 7.8 cents a share.

Internet domain registry company Minds + Machines (MMX) moved into profit in 2016. Revenues grew from $5.5m to $13.5m, while a loss was turned into an underlying pre-tax profit of $3.5m. This follows a restructuring of the business and the sale of non-core operations. Sales of the .vip domain in China were the major factor in the growth in revenues and .boston should be launched later this year. Cash conversion was poor due to restructuring costs and increased working capital.

Directa Plus (DCTA) had technological problems which held back the progress of the graphene producer last year. In 2016, revenues fell from €1.7m to €0.8m and the loss more than doubled to €4.1m. The reason behind the fall in revenues was the lack of sales of mobile decontamination units with sales of G+ graphene nearly doubling. The focus is textiles and environmental uses of the company’s graphene. Directa Plus has net cash of €6.8m and this will be enough to absorb the expected cash outflows for the next couple of years.

Diagnostic tests supplier Omega Diagnostics (ODX) says that its underlying pre-tax profit will fall from £1.3m to £1.1m in 2016-17. All divisions increased their revenues, helped by currency movements. Field trials are planned for the VISITECT CD4 test and the CE mark could be obtained by the end of the year.

TLA Worldwide (TLA) continues to embarrass itself with disastrous trading statements. Having issued a trading statement at 6.26pm on 23 December 2016, it has released its latest profit warning at 4pm – management probably thinks that is a big improvement because it was before the market closed. It turns out that four months after the end of the financial year TLA’s 2016 figures will be even worse than expected. Changes to revenue recognition and provisions for money that TLA thought it was owed but has not been paid are the reason. There is also money that TLA believed it was owed in financial periods prior to 2016 but has not been paid. That will lead to write-downs and the current estimate is between $1.5m and $2.5m. The 2016 figures may eventually be released in late May, according to the company.

Imaginatik (IMTK) says its revenues for the year to March 2017 will be flat at £3.9m but the loss should still be reduced. Bookings for the innovation software were lower at £3.5m but new clients were won in the second half. Imaginatik could be on course to breakeven in the current financial year.

AstraZeneca has returned the rights to AZD9412 to Synairgen (SNG) following a phase IIa study. The inhaled interferon beta did have a beneficial impact on lung function but the positives were not enough to continue with trials. The data will be returned to Synairgen for it to analyse. Synairgen has £4m in the bank.

Avacta (AVCT) has signed its first non-therapeutics licence for its affimers. The licensee is a major global diagnostics companies. The upfront payment is probably small but this is a significant deal.

Radiation detection technology company Kromek (KMK) is trading in line with expectations and it expects to continue to win new contracts.

Property management services provider HML Holdings (HML) has confirmed that its 2016-17 profit will be in line with expectations of £1.8m. There were six acquisitions during the year. A 2017-18 profit of £2.2m is forecast.

Instant communication mobile services provider Mobile Tornado (MBT) has raised £1.1m at 5p a share and the cash will be used for further development of its technology and support the launch of the Dispatch Console service. Last year, revenues fell 10% to £2.02m but recurring revenues increased to more than 90% of the total. The loss increased from £2.03m to £3.73m. Net debt was £9.06m at the end of 2016.

MAIN MARKET

Sealand Capital Galaxy Ltd (SCGL) has completed the acquisition of social media business SecureCom and Sealand hopes that a share split/bonus issue will improve liquidity. Existing shareholders will receive nine bonus shares for each one they own, leaving them with ten times the number of shares and the share price would be adjusted from 25p to 2.5p. The November 2015 flotation price was 10p and earlier this year a further £1.4m was raised at 20p a share. Pro forma cash was £3.26m at the time of the acquisition.

A number of standard list shells have reported their annual figures so that they beat the deadline of the end of April. Financial services-focused shell Vertu Capital Ltd (VCBC) is still discussing the potential acquisition of VCB Malaysia but there is still some way to go before a deal is secured. There was £553,000 in the bank at the end of 2016. Auctus Growth (AUCT) still had £1m in the bank at the end of 2016 and it continues to assess potential acquisitions.

Papillon Holdings (PPHP) is still proceeding with the long drawn out acquisition of Myclubbetting.com and it is near to lodging a readmission document with the UKLA. The publishing of the accounts of Papillon has been delayed because of difficulties concerning quantifying the costs of the acquisition.

Andrew Hore

Quoted Micro 27 February 2017

NEX EXCHANGE

Capital for Colleagues (CFCP) says that one of its employee-owned investee business FJ Holdings has sold its businesses and been placed in administration. Capital for Colleagues had not been kept up to date with these moves. The loans to FJ and its subsidiary Ham Baker Adams plus the FJ share stake were valued at £1.3m at the end of November 2016, which included a £790,000 valuation for the share stake. That investment is equivalent to one-quarter of Capital for Colleagues’ NAV, suggesting a pro forma NAV of about 40.5p a share if the investment is completely written off. That is well below the current share price.

Ace Liberty & Stone (ALSP) says that the £3.55m sale of Hume House in Leeds announced in January 2016 has not been completed. Hume House was acquired for £1.67m in March 2014 and annual rental income is £188,000. Ace has raised £4.55m from the sale of Bridge House in Luton, which was acquired for £2.75m in November 2014, and been occupied by HM Revenue & Customs for more than three decades.

Middle East-focused investment vehicle Indigo Holdings (INGO) has made its first investment ten days after it joined NEX on 10 February. There was net cash of £818,000 at the time of flotation and €176,800 (£150,000) was spent on a 5% stake in Iranian car ride sharing app Carvanro. Indigo believes that the growing younger population in Iran will be receptive to the service. The app was launched in mid-2016 and registered users and completed rides are growing month-on-month.

Queros Capital Partners (QCP) has issued an additional £960,000 (£950,400 net) of 8% bonds 2025. That takes the bonds in issue to £2.625m. The cash will initially be used to provide bridging loans as Queros seeks to acquire social housing projects in the longer term. NQ Minerals (NQMI) has raised a further £82,000, having raised £128,750 at 0.8p a share last week. IMC Exploration (IMCP) has issued 2.5 million shares at 1p each to pay for professional fees and converted a Wilhan loan note into 3.2 million shares at 2p each. .

Peterhouse has replaced Grant Thornton as corporate adviser to Chinese medical products and services provider MiLOC Group (ML.P). Director Dennis Ow has satisfied a HK$500,000 loan by transferring 177,353 shares previously pledged as collateral, taking his stake to 0.44%.

Impact investing company Menhaden Capital (MHN) has decided to delist from the NEX Exchange Main Board in order to reduce costs but retain its premium listing on the London Stock Exchange.

AIM

Fishing tackle and products retailer Fishing Republic (FISH) is on course to increase pre-tax profit from £305,000 to £404,000 in 2016. Year-on-year revenues were 40% ahead, suggesting a figure of around £5.8m. A new store was opened in Mildenhall at the end of 2016 and another in Milton Keynes in January 2017. Two more, in Reading and Ipswich, are planned before the end of the fourth quarter. These stores will all be ready for the 2017 fishing season. Online sales have fallen but a greater proportion of them are direct through the company’s website which has improved gross margin. Last year’s share issue has diluted earnings per share but investing the cash in new stores will help to compensate for that. The 2016 figures will be published before the end of April.

Software robotics company Blue Prism (PRSM) says that its revenues were strong in the first quarter and it already expects full year revenues to be well ahead of expectations.

North Italy-based gas producer Saffron Energy (SRON) joined AIM on 24 January and ended the day at 7.38p. Saffron raised £2.5m at 5p a share. The cash will finance the development of three gas fields.

Gold recovery services and mining company Goldplat (GDP) increased its revenues in the first half even though gold sales were lower due to delays in selling gold from the Ghana plant, which did not get the required licence to sell the gold until the end of the period. The gold has been sold in the second half. First half revenues were still higher because of a 15% rise in the gold price achieved and currency movements. There was still £885,000 in the bank at the end of 2016. A full year pre-tax profit of £1.94m is forecast as the benefits from the investment in the Kilimapesa gold mine start to show through. Further capital investment will be required for the Kenyan mine and the gold recovery activities.

Conygar Investment Company (CIC) is selling its investment property portfolio to Regional Commercial Midco, which is owned by Regional REIT, for £129.8m – a few hundred thousand pounds ahead of its book valuation. Regional REIT will issue 26.3 million shares at 106.347p a share and assume bank debt and repayment of zero dividend preference shares. Shareholders will have to approve the transaction. Conygar will be able to focus on its development assets.

Vernalis (VER) made further progress in building sales of the Tuzistra cough treatment in the first few months of the cough season. In the six months to December 2016, revenues were one-third higher at £800,000 and the second half could be stronger. Growth in Tuzistra sales was not enough to offset declines elsewhere and total revenues fell from £6.1m to £5.6m. There could be two additional cough treatments on sale next year if the FDA approvals are achieved. Net cash was £74.2m at the end of 2016.

Security technology and services supplier Synectics (SNX) reported a 4% rise in revenues to £70.9m last year but higher margin gaming contracts meant that there was a sharp bounce back in profit. Net cash was £2.17m at the end of November 2016. This year’s underlying pre-tax profit is expected to grow from £2.6m to £3m, although this represents slower growth than originally expected.

Cairn is resigning as nominated adviser to CloudTag Inc (CTAG) on 10 April but the company has managed to raise £975,000 at 3.75p a share via Novum Securities at a cost of £58,500. Trading in the shares was subsequently suspended pending an announcement. CloudTag will need to find another nominated adviser to continue on AIM.

International benefits insurance provider GBGI Ltd (GBGI) joined AIM on 22 February when it was valued at £130.4m at 150p a share. The share price was unchanged at the end of the week. GBGI intends to pay a dividend equivalent to 60% of distributable profit.

Stellar Diamonds (STEL) is raising £324,500 from a placing at 5.5p a share and up to £250,000 from an open offer at the same price. Once the placing is completed the shares will return from suspension. The cash will help to pay creditors and be used to progress the Tonguma project in Sierra Leone. Further cash will be required.

Timber processing and renewable energy business Active Energy (AEG) is in discussions to acquire further timber assets in North America and Europe. AEG WoodFibre generated lower revenues in 2016 because of weak demand from MDF manufacturers in Turkey after the coup. A new softwood processing plant should be up and running in April. The CoalSwitch division will be the main focus of growth this year.

SigmaRoc (SRC) says that its maiden acquisition Ronez has been integrated more quickly than it expected. The new systems should be up and running by the end of April and the back office systems budget should be halved. January sales volumes were ahead of budget and the first quarter order book is strong for the Channel Islands-based construction materials supplier. SigmaRoc has secured a £2m revolving credit facility from Santander and a £18m term facility is being negotiated. These two facilities will last until 2021.

Northland has increased its profit forecasts for online gaming marketing business Veltyco Group (VLTY). The 2016 pre-tax profit estimate has been raised from €1.35m to €1.99m, which is in line with the recent trading statement. The 2017 profit forecast has been raised from €3.18m to €4.27m and for 2018 from €4.21m to €5.44m.

Savannah Resources (SAV) has raised £2.24m at 5.25p a share and it has letters of intent for a further £1.01m from the chairman and a major investor, Al Marjan, which will maintain its stake at 29.9%. Savannah has reduced its full year loss from £3.1m to £1.8m and there was £700,000 left in the bank at the end of 2016. This year Savannah expects to complete the scoping study for the Mutamba heavy mineral sands project in Mozambique, where it has signed a consortium agreement with Rio Tinto, and start mining copper in Oman. Savannah is also defining drill targets for Lithium in Finland.

Premier African Minerals (PREM) is on course to get production restarted at the RHA tungsten mine. Underground mining contract terms have been agreed with delivery of up to 16,000 tonnes of ore each month.

Edenville Energy (EDL) has raised £2m at 0.8p a share, with every two new shares eligible for a warrant exercisable at 1.08p a share over the next 18 months. The cash will be used to acquire capital equipment and finance other costs of developing the Rukwa coal project in Tanzania. Commercial mining should begin by the end of the first quarter of 2017. Edenville has relinquished its uranium prospecting licence to concentrate on Rukwa.

MAIN MARKET

Small company-focused investment company Athelney Trust (ATY) has increased its dividend by 8.8% to 8.6p a share, although NAV growth was more modest at 2.5%. Last year, Athelney did not do as well as AIM or the FTSE Fledgling index which each grew by around 15%. Athelney is more exposed to the commercial property market than AIM or the Fledgling index. Property shares were hit by the EU referendum and did not clawback their falls by the end of the year. Athelney takes a long-term view and it has still outperformed AIM since 2005. The focus remains companies that are steadily growing profitability and dividends. Realised capital gains were £294,000 in 2016, helped by takeovers of Premier Farnell, UK Mail and Wireless. A stake was acquired in Lavendon last year and that is being taken over. The NAV was 251.1p a share at the end of 2016. Having raised £407,000 at 233.2p a share last April, Athelney still had invested most of the cash and had £59,000 left in the bank – slightly higher than a year earlier. The NAV had slipped to 250.4p a share by the end of January.

Standard listed and TSX Venture Capital Market-quoted Zenith Energy (ZEN) is selling its operations in Argentina so that it can concentrate on its operations in Italy and Azerbaijan. Production was suspended in 2015 because a storage tank owned by the state oil company collapsed so oil could not be transported. The operations are being sold for a nominal sum because investment is required and the buyers are taking on environmental responsibilities.

Standard list shell Sealand Capital Galaxy Ltd (SCGL) is acquiring SecureCom Group for 10 million shares and £1m in cash. Sealand had £600,000 in cash at the end of June 2016 and it is raising a further £1.4m (1.27m net of expenses) at 20p a share. The November 2015 flotation price was 10p. SecureCom also brings cash with it and pro forma cash is £3.26m and there is subscription money owed to the company of £8.58m. The pro forma NAV is 3.87m because of the heavy losses incurred by SecureCom, which has spent large amounts on sales and marketing of its instant messaging and communications products n the Asia Pacific region.

Andrew Hore

Quoted Micro 13 February 2017

NEX EXCHANGE

Investment vehicle Indigo Holdings (INGO) is seeking acquisitions in the consumer, financial and technology sectors in the Middle East and it joined NEX on 10 February. An initial 15 million shares were issued at 1p each and in January a further 26.5 million shares were placed at 3p each. The market capitalisation is £1.24m at 3p a share. There was net cash of £818,000 at the time of flotation. Indigo can issue a further 218.5 million shares. There has been one trade of 4,000 shares at 5p each but the bid/offer spread is 3p/5p.

Equatorial Mining & Exploration (EM.P) has signed a conditional option agreement to acquire a Mexican mining and exploration project. The option lasts 90 days and the acquisition will be funded by the issue of £10.4m worth of shares. Equatorial will need to raise at least £2m to finance the Tango project which includes copper, gold and molybdenum interests. This is an area with historic workings. An initial fundraising of £250,000 at 0.00125p a share will finance the current interests in Nigeria. There are plans to consolidate the Equatorial shares on the basis of 0ne new share for 650 shares and then switch to a standard listing.

A new investment in blockchain technology company Factom Inc means that the stake owned by investment company Coinsilium Group Ltd (COIN) has increased by 236.5% since the initial investment. The 1.5678% stake in the developer of audit and accountability tools using blockchain technology is valued at $473,000.

Western Selection (WESP) says that its NAV has increased by 6% to 84p a share in the six months to December 2016 but this had increased to 91p a share by the end of January. Gains have been made on the disposal of shares in Swallowfield (SWL) with some of the cash used to buy shares in Bilby (BILB), which has been hit by a profit warning. The interim dividend has been increased from 1.05p a share to 1.1p a share.

Milamber Ventures (MLVP) has removed Barney Battles from the board but he wants to convene a general meeting to get himself reappointed to the board. Milamber says that there are concerns about the League of Angels business that he sold to the company.

African Potash Ltd (AFPO) has raised £126,000 at 0.045p a share and issued 55.2 million shares to pay liabilities. The new shares account for 22.7% of the enlarged share capital.

FT8 (GFT) is still trying to secure payments from Billyst Holdings, which has defaulted on its agreement to provide monthly payments. This means that FT8 is short of cash.

AIM

Staunton Holdings Ltd has launched a recommended offer of 300p a share for FIH Group (FIH). The deal values the Falkland Islands trader and transportation company at £37.1m. The bidder is controlled by The Rowland Purpose Trust 2001he bid is at a significant premium to the market price prior to the announcement but it is below the level of the share price two years ago. FIH has net cash of nearly £10m. The bid values FIH at 15 times 2015-16 earnings but profit is likely to fall this year making the prospective rating 26 times. When the interim figures were published in November, house broker WH Ireland estimated a sum of the parts valuation of 320p a share but this was subsequently reduced to 300p a share.

Ascent Resources (AST) launched a £3m fundraising via PrimaryBid.com, which closed at 5pm on Sunday 12 January. The offer at 1.85p a share is underwritten. The cash will be spent on the Petisovci project in Slovenia, where there has been positive news on flow rates at Pg-10. Ascent has risen money via PrimaryBid.com a number of times in the past.

Strategic Minerals (SML) has exercised the option to take a 50% stake in the Redmoor tin/tungsten project in Cornwall. The £844,000 payment to take the stake to 50% will provide the joint venture with funds for the 2017 drilling programme. The rights to sell the stockpile of magnetite from the Cobre mine in New Mexico have been renewed for a further 12 months to the end of February 2018 and there is still a possibility to come to agreement over a contract lasting a number of years, which would provide more certainty about future revenues. Strategic Minerals moved into profit in 2016 thanks to strong sales of magnetite and it has enough cash to push ahead with the development of its other interests. Strategic Minerals is also interested in the CARE nickel project in Australia.

Billington (BILN) has confirmed that its 2016 figures will be in line with expectations, which ended had been increased by 26% over the past year. A pre-tax profit of £3.5m is forecast. The structural steel supplier will publish the figures on 21 March.

Thor Mining (THR) says that it should receive the final payment for the disposal of its Spring Hill gold project before the end of February. Heavy snow has delayed the commencement of drilling at Pilot Mountain. The cash received will help to finance the drilling.

TechFinancials Inc (TECH) says that its 2016 figures will be better than expected but the loss of a client (24Option.com) will hit the 2017 figures. The client will end the agreement on 1 April. The 2016 EBITDA of $2.8m is well above the forecast of $1.6m. However, any dividend will be put off until there is more clarity about future trading.

Spend management platform developer blur Group (BLUR) has signed up the first large customer for its 12 month group buyer plan. The subscription is paid upfront which is good for blur’s cash flow. The attraction is the potential cost savings by the customer, which is a law firm, and it could be followed by other large customers signing up for the package which provides access to 65,000 suppliers and covers up to $2m of purchases in a year. There is a higher subscription rate for annual purchases of more than $2m. By focusing on larger customers blur has been able to reduce costs and it has been jettisoning unprofitable small customers. Cash burn has been reduced in each of the past five quarters and 2017 will see the full benefits of the cost cutting. The costs in the fourth quarter of 2016 were 43% down on the fourth quarter of 2016. There was £2m in the bank at the end of 2016. This will not last long if the cash burn is not reduced further.

Monchhichi (MCC), formerly Mercom Capital, is raising £2.1m at 35p a share in order to finance the company’s new investing policy focused on technology, media and internet sectors. Each of the new shares comes with a warrant that is exercisable at 80p a share. Shares have been issued at 40p each to cover £200,000 of professional fees.

Crystal Amber Fund Ltd (CRS) has increased its stake in medical devices developer GI Dyamics Inc from 22.65% to 38.73%. Other shareholders in the developer of the EndoBarrier minimally invasive device for treating type 2 diabetes and obesity, include Johnson & Johnson. EndoBarrier is in use in Europe and other countries outside of the EU but an FDA trial was terminated. More than 3,500 patients have been treated through the placing of a temporary bypass sleeve in the intestine – equivalent to a gastric bypass–type treatment. Although GI is based in Boston, Massachusetts but it is quoted on the ASX. The share price has slumped since GI joined the ASX in 2011 and Crystal Amber believes that this is an opportunity to invest in a treatment for significant clinical need at a depressed valuation.

Pebble Beach Systems (PEB), or Vislink as it was known up until the beginning of February, has warned that its 2016 figures will be even worse than expected. The poor performance of the former Vislink hardware activities is not great surprise and the additional write-offs were obviously required given the price it was sold for. However, the remaining software business has also disappointed, although order levels have been good. That suggests a better 2017. Debt remains high and the £8m deferred payment due in mid-March is important if Pebble Beach is to have anything like a stable financial position. Kestrel still believes in the business and it has taken its stake to 14.4%.

React Energy has changed its name to EQTEC (EQT) following the issue of shares to EBIOSS Energy taking its stake to 51%. The share issue covers the €5.15m debt that was due from 50.02%-owned subsidiary Newry Biomass. The 5.53p issue price was a premium to the market price at the time the deal was announced but it subsequently rose above the issue price. Newry should be on course to produce electricity by March 2018. The main revenue generating asset is a wind turbine in County Cork.

Mattioli Woods (MTW) has acquired a 49% stake in profitable small company-focused fund manager Amati Global Investors for £3.33m in cash and shares and has an option, lasting two years from February 2019, to buy the other 51% for cash and shares. The wealth management and employee benefits business reported interim earnings per share nearly one-quarter higher at 11.7p and an interim dividend per share 22% higher at 4.7p. Net cash was £22.6m at the end of November 2016.

PowerHouse Energy Group (PHE) has signed a memorandum of understanding with Peel Environmental to develop and operate an energy from waste plant at Peel subsidiary Protos’ Chester facility. This would be PowerHouse’s first commercial project and Peel has a number of other potential sites if this is successful. The deal is a positive result of the previously announced joint development agreement with Waste2Tricity.

Former Hydro International boss Michael Jennings has taken over as interim chief executive of Autins Group (AUTG). Jennings has been appointed for six months following the departure of the previous chief executive of the acoustic and thermal insulation supplier. The strategy is to take Autins products into new sectors so that it is not so dependent on a limited number of automotive customers. Earlier in the month, a major customer reduced orders leading to a profit warning.

A slow build-up of occupancy levels at the new Holland Park site meant that hostels operator Safestay (SSTY) performed disappointingly last year. Even so, EBITDA increased from £600,000 to £2.2m.

Botswana Diamonds (BOD) has entered into an option to acquire kimberlite projects in South Africa. Botswana Diamonds has the option to acquire a 72% interest in the projects in return for £942,000 in cash and 100 million shares. This is payable in stages. An exclusivity and option fee of £122,000 is payable equally in cash and shares at 1.9p each. Then £215,000 has to be spent on exploration in 12 months to earn a 15% stake and then a further £215,000 in the next 12 months to take the stake to 40%. There is then nine days in which to issue 96.8 million shares and pay £300,000 of shareholder loans in order to reach 72%. The main asset is the Frishgewaagt project in Limpopo province and there are nine other prospecting rights.

Connemara Mining Company (CON) has confirmed the presence of lead, zinc and silver within a 2 metre wide bed at the former silver mine at Glentogher in Donegal but there are no signs of gold. Connemara Mining had previously found gold 8km away and the structural model will have to be revised. Teck has spent enough on exploration to take its stake in the Oldcastle block on the Cavan/Meath border to 65%. The latest drill hole has found trace mineralisation (zinc and lead).

Savannah Resources (SAV) says that initial metallurgical results suggest that there should by 90% plus recoveries at the Oman copper gold project.

MAIN MARKET

BATM Advanced Communications Ltd (BVC) is paying £580,000 to buy Zer Laboratories, the largest private diagnostics laboratory in Israel. Zer’s expertise fits well with BATM’s move into non-invasive pre-natal tests. In 2015, Zer made a profit of $27,000 on revenues of $2.4m. There are potential deferred payments dependent on sales increases.

PRE-IPO / OTHER TRADING FACILITIES

Integumen, which bought the Innovenn healthcare product development business of Venn Life Sciences (VENN), is raising £2.16m ahead of a flotation. EIS relief is available for this investment. The offer equates to 23.6% of the enlarged share capital. Integumen has made three other acquisitions and its interests include skincare, wound care and oral care. It also includes the Labskin product developed by AIM-quoted Evocutis before it was sold to Venn. The offer is available via the Crowd for Angels crowdfunding site (www.crowdforangels.com/integumen)

Former GXG-quoted company US Oil & Gas is trying to raise up to £2.18m via a ten-for-63 open offer at 27p a share. A placing has already raised £470,000 at the same price. Revised resource estimates in the area of the Eblana#1 well in Nevada show a 20% recovery factor suggesting a low case of 57 million recoverable barrels of oil and a best case of 207 million recoverable barrels of oil.

Andrew Hore

 

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