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Quoted Micro 5 September 2022
AQUIS STOCK EXCHANGE
Cancer treatments developer Incanthera (INC) says that commercial discussions continue for skin cancer treatment Sol and there is potential for a Sol-based product range. There is still £295,000 of cash in the balance sheet at the end of March 2022. The Actino-Pro brand has been trademarked. There was a cash outflow from operations of £660,000 in the previous 12 months. Two directors have provided a loan facility of £190,000, of which £50,000 has been drawn. The directors have waived their remuneration and a payment to UOB has been deferred. Management believes that Incanthera will have enough finance until the fourth quarter of 2023. Potential partners could take advantage of the lack of cash when doing a deal.
S-Ventures (SVEN) has acquired Lizza, a wellness and free-from food brand, from Peter Cremer Holding. The Hamburg-based agricultural business is subscribing £2m for shares in S-Ventures at 70p each. The share price has never traded at that level. Lizza produces pasta and breads and provides S-Ventures with a base in the German market. Revenues were €4.5m in 2021. The initial cost of the deal is €1, but there is an earn-out based on a share of profit over ten years up to a maximum total of €2.366m.
Healthcare IT developer DXS International (DXSP) is reviewing its growth plans for the next 24 months. The new strategy will be designed accelerate growth and is likely to require additional funds. They will probably be raised through a share issue and that appears to have worried investors.
KR1 (KR1) has invested $300,000 in RedStone Finance, as part of a $7m fundraising. KR1 participated in the previous financing round. RedStone is developing RedStone Oracles, a provider of data feeds for crypto assets, and smart contract platform provider Warp Contracts.
Rent guarantee service provider RentGuarantor Holdings (RGG) published interim results showing a jump in revenues from £91,000 to £170,000. Higher admin expenses meant that the loss increased from £258,000 to £353,000. Revenues continued to improve in July and August.
Tectonic Gold (TTAU) says 40%-owned Whale Head Minerals has received a mining permit for its near-production minerals sands operation, which has an estimated NPV of £150m. Tectonic Gold has agreed to transfer a 30% stake to Whale Head Minerals’ BEE partners, which have mining expertise, and it will retain a non-diluting interest of 10%.
Invinity Energy Systems (IES) says contract manufacturer Baojia has shipped 1.1MWh of Invinity batteries from its factory in China designed for the project with Elemental Energy in Canada. Final assembly and testing will be done by Invinity Energy Systems at its factory before delivery.
TECC Capital (TEC) has invested a further £200,000 in convertible loan notes in EDX Medical. This takes the total investment in convertibles to £500,000, which is guaranteed by EDX Medical founder Professor Sir Chris Evans. Discussions continue about the acquisition of EDX Medical.
Vulcan Industries (VULC) has sold tacks and nails manufacturer IVI Metallics for £1. The business had net liabilities of £458,000 and it has struggled to rebuild its order book. Vulcan Industries still provides a cross guarantee for the CBIL liability of £739,000.
SuperSeed Capital Ltd (WWW) says that SuperSeed Fund II has led a $3.6m investment in brand advocacy platform Duel. The software-as-a-service platform helps retail brands grow via positive feedback from customers. ASOS, Unilever and Mint Velvet are among the clients.
Evrima (EVA) has an 8.93% stake in Kalahari Key, which has provided an update on the Molopo Farms Complex project. A diamond drilling contract has been signed with a Botswana-based company.
Yooma Wellness Inc (YOOM) increased interim revenues from $2.78m to $6.49m and the loss has been reduced from $5.57m to $3.83m. CBD product sales were strong in Europe and Japan. The company has been reducing its expenses.
Clarify Pharma (PSYC) had cash of £2.1m at the end of May 2022. It is seeking investments in the medical use of psychedelics.
Oscillate (MUSH) had £1.91m in the bank at the end of May 2022, although £600,000 has been invested in Aquis-quoted Psych Capital (PSY) and fully listed Dev Clever (LON: DEV).
AIM
Futura Medical (FUM) says that the clinical study for the MED3000 topical gel erectile dysfunction treatment has met its primary and secondary endpoints. The study showed an improvement in erectile function and a highly statistic improvement in the onset of action at 10 minutes. There were limited side effects with 4.3% of patient suffering headaches and a further 4.3% nausea, which is much better than rival treatment tadalafil. The next move is submitting MED3000 for FDA review as a De Novo medical device for the over-the-counter treatment of erectile dysfunction. This could lead to marketing authorisation by the first quarter of 2023. MED3000 has received the UKCA mark.
Neurocrine Biosciences Inc is making a recommended bid of 27.5p a share in cash for hormonal disease treatments developer Diurnal (DNL), which values the company at £48.3m. The April 2021 placing and open offer was at 70p a share and the share price has slumped since then. Revenues have not built up as fast as hoped and another cash raising is on the horizon if Diurnal stays independent.
Pharma software provider Instem (INS) has gained its largest ever contract. The deal is worth at least $12m over five years. The client is a contract research organisation and is for the company’s cloud-based Aspire clinical trial acceleration software, which will be launched with the customer in one year. There is $3m for implementation and the rest is paid in instalments of $2.25m a year over four years. The annual recurring revenues are $1m more than for the Instem system that is being replaced.
Egg-free cakes retailer Cake Box (CBOX) says trading is becoming more difficult and only part of the cost increases it is suffering are being passed on to franchisees. Sales are also under pressure with a like-for-like decline of 2.8% so far in this financial year. This means that full year profit will be much lower than the £7.2m expected. There is £6.7m in cash, although the £2m dividend will be paid in September. Chief executive Sukh Chamdal acquired 225,000 shares at 121.85p each.
Telephony services provider LoopUp Group (LOOP) has taken on a book of conference service contracts from a US competitor for no initial payment. There is a revenue share agreement for three years to October 2025. These contracts could generate cash of £5m a year, although it may reduce due to customer churn. This is much-needed cash flow for the business, which is still heavily loss-making. The new bank facility is £17m and that more than covers the expected net debt at the end of 2023.
Oil and gas producer PetroNeft Resources (PTR) has an oil storage and transportation contract with Nord Imperial for production from licence 61 in Tomsk Oblast, Russia at a cost that is far above standard market rates. PetroNeft has tried to change the contract and started paying reduced amounts, but Nord Imperial has suspended acceptance of oil. PetroNeft is shutting down its wells, which will hit income. Licence 67 is not affected and is producing 270 barrels of oil per day.
Independent directors of market research firm System1 Group (SYS1) are conducting a strategic review and the proposed tender offer has been postponed. This review will assess whether the company can grow faster if partners or an external investor are brought in.
MAIN MARKET
Zamaz (ZAMZ) joined the standard list last Friday and raised £3.69m. Cornerstone investor Atlas paid 10.45p a share, which is a 5% discount to the nominal subscription price. Most of the cash will go on expenses and repaying existing bonds. Zamaz believes that its technology platform can help to efficiently build direct to consumer brands via e-commerce. Amazon is currently the main marketplace used by the company. There is already a portfolio of brands in the group, but most are at an early stage of their development. There are plans to acquire more brands. Revenues are relatively modest and Zamaz is losing money. The share price fell to 9.48p (8p/10.95p) on the first day. There were 90,000 shares traded in one deal at 10.95p. The shares are tightly held and there is potential dilution from the convertibles worth up to £15m that could be issued to Atlas Capital Markets and the associated warrants.
First Tin (1SN) has announced positive intercepts at the latest two drill holes at the Gottesberg tin project in Germany. These and other results validate the belief that a higher grade core exists within the deposit.
Iconic Labs (ICON) has settled disputes and has finalised proposals for a company voluntary arrangement. If this goes ahead then the administration will end and trading in the shares may recommence once up to date results have been published. The shares have been suspended for around 15 months.
Andrew Hore
Ian Pollard: Sanderson Sees Double Digit Growth
Sanderson Group plc SND Half year trading results to the end of March, are ahead of management’s expectations with revenue growing to approximately £17.0 million from last years £14.6 million and operating profit increasing by over 30% to £2.8 million from last years £2.1 million. Digital Retail has continued to perform strongly during the six months and achieved further double-digit revenue and operating profit growth.in The Manufacturing business sales orders grew by over 10%. The Board is confident that it will be able to maintain its progressive dividend policy.
System 1 Group plc Sys1 updates that its Consultancy business stabilised after a difficult 2017/18. Gross profit was down 1% for the year as a whole at £22m but Being 4% ahead in the second half, allowed it to generate underlying pre-tax profits for the year as a whole.
Serabi Gold plc SRB Reports another excellent quarter with a strong start made to 2019 and over 10,000 ounces of gold produced in the first quarter, keeping up the momentum from the end of 2018 and the second successive quarter with production above 10,000 ounces for the first time. Guidance for 2019 is maintained at production in the range of 40,000-44,000 ounces representing a significant improvement on 2018’s production of 37,108 ounces.
IG Design Group plc IGR The strong trading performance continued in the final quarter both delivering revenue and profit growth across all regions in the year to the 31st March.. The Board now anticipates that the financial performance of the Group will be be up significantly up year on year. The progressive dividend policy is expected to be continued earnings pay-out ratio is also expected to be increasesd at the full year.
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Andrew Hore – Quoted Micro 5 November 2018
NEX EXCHANGE
Brewer Shepherd Neame (SHEP) has secured long-term facilities of £50m, which expires in 2023, and a £35m private placement of loan notes with BAE Systems Pensions Fund which lasts for 20 years. These replace existing loans. A revaluation of pub assets has delivered a £24m gain on book value.
Mechanical and electrical services provider Field Systems Designs Holdings (FSD) has benefitted from strong spending in the water sector as Asset Management Plan 6 reaches its mid-point, as well as demand from the energy from waste sector. However, the energy from waste customer’s tough stance has held back group gross margin. In the year to May 2018, revenues improved from £17.2m to £25.9m, but pre-tax profit fell from £839,000 to £625,000. If the defined benefit scheme settlement gain is stripped out, then there is an improvement in profit from £463,000 to £558,000. There is £3.97m in the bank. The current order book is worth £12m.
Coinsilium Group Ltd (COIN) is pushing ahead with Flowstone Capital Ltd, which is a private crypto fund and it has set up Flowstone Management Ltd to manage the fund. Coinsilium has also secured a strategic advisory partnership with LC LITE, which is planning a token generation event to finance the development of a digital letter of credit system for importers and exporters.
Startup Giants (SUG) still had £665,000 in the ban at the end of July 2018. Thee are plans to raise more cash via the event management services provider Exponential Events’ platform.
TechFinancials Inc (TECH) is in talks with blockchain-based sports ticketing platform Footies Tech to establish a new subsidiary to develop a blockchain-based venue management system. The idea is that TechFinancials will own 75% of the company and it would provide finance of up to $500,000 to develop a proof of concept. TechFinancials will licence its technology to the new company for free.
Formerly AIM-quoted Metminco (MNC) has withdrawn from the proposed acquisition of Gunsynd (GUN) investee company Sunshine Minerals after it failed to complete due diligence. Gunsynd says that there are other interested buyers even though the nickel price has fallen since the original announcement about the proposed acquisition.
The chairman and chief executive of DXS International (DXSP) have bought further shares last week. Chairman Bob Sutcliffe bought 18,857 shares at 10.5p each, while chief executive Bob Immelman acquired 19,802 shares at 10p a share which took his stake to 10.4%.
Ananda Investments (ANA) executive director Melissa Sturgess has bought another 500,000 shares at 0.4501p each.
AIM
Gordon Dadds (GOR) is acquiring Ince and Co International LLP and its associates, which will make it the largest quoted law firm. Annual revenues will be more than £110m. The estimated consideration will be £34m, depending on revenues generated in the three years after acquisition. The merged company will be called Ince Gordon Dadds. Share trading remains suspended until the full details of the deal are published.
Watkin Jones (WJG) says that its full year figures will be slightly better than expected. Good progress is being made with the build to rent operations, but the benefits will come in the future. The sale of a client portfolio of the student accommodation management division has led to a termination fee and a share in the profit of the disposal, which totals £4m.
Concepta (CPT) has obtained a CE Mark for its myLotus fertility testing technology. This enables women to test for their optimal level of fertility. The self-test platform has been launched at the Fertility Show in London. Initial sales will be via the company’s own website. It will take time to build up sales and it is likely to be next year when they become more significant. Concepta raised £2m in August so it is well-funded for its current requirements.
Goldplat (GDP) says that first quarter production fell to 6,100 ounces of gold because of problems sourcing raw materials in Ghana and South Africa, but there has been a recovery in the second quarter and it should be able to achieve full year production estimates of 39,5000 ounces of gold. The Kilpesa mine is being put on care and maintenance if a partner cannot be found and that could knock 3,700 ounces off the production figure.
Next Fifteen Communications (NFC) has raised £20m at 475p a share. The PR firm will use some of the cash to finance the acquisition of Activate Marketing Services for an initial $9m in cash. This technology-focused business is data-led and will continue to be operated separately. This is the latest example of Next Fifteen’s strategy of growing its digital marketing operations.
Gama Aviation (GMAA) says that growth has been slower than anticipated in the second half. The main culprits are the US air associate and slower than expected growth at the new Bournemouth ground services facility. This equates to a $3m cut in forecast operating profit for 2018 and the earnings per share forecast has been reduced by 19% to 21.3 cents.
The share price of floorcoverings manufacturer Victoria (VCP) slumped on the back of a warning that margins were coming under pressure. Like-for-like revenue growth was more than 3% in the six months to September 2019, but less profit is being made. Victoria is attempting to refinance its two-year bank facility through the issue of a five-year €450m bond, which has been given a BB minus credit rating by Standard & Poors.
Safestay (SSTY) has acquired a 20-year lease on a site in Vienna. This is currently a hotel and it will be converted into a 234 bed hostel at a cost of less than €300,000. Safestay will have 13 hostels.
Pires Investments (PIRI) had a NAV of £950,000 at its year end. The £200,000 increase was mainly due to investments in SalvaRx and Eco (Atlantic) Oil and Gas.
Imaginatik (IMTK) has launched its six-for-nine open offer to shareholders. This could raise up to £253,000 at 1.1p a share. The closing date is 26 November.
Market research firm System1 Group (SYS1) has declared a maintained interim dividend of 1.1p a share, but the final dividend may be reduced. Interim revenues declined by 5% and pre-tax profit was lower without the £250,000 exceptional credit. That is due to investment in the Ad Ratings business. There was £3.55m in the bank at the end of September 2018.
Mporium (MPM) has signed a deal with BPC Land and Sales Marketing, a services provider to property developers. BPC will use Mporium’s IMPACT technology for digital advertising campaigns. This is a new sector for Mporium.
Biome Technologies (BIOM) has increased nine months revenues by 59% to £7m, which is more than for the whole of 2017. Biome is profitable and it had £2.5m in the bank at the end of September 2018. The main growth has come in the RF Technologies division. The bioplastics business increased its third quarter revenues, but nine months revenues are still lower.
Parity (PTY) has warned that there will be a significant shortfall in profit in 2018 because of the continuing delay of a major contract. WH Ireland has slashed its pre-tax profit forecast from £1.9m to £850,000, suggesting limited profit in the second half.
Meat and delicatessen products retailer Crawshaw (CRAW) is appointing an administrator because it was unable to raise the cash it required.
Elektron Technology (EKT) has increased its nine months revenues from £22.1m to £25.8m and the full year outcome is set to be ahead of expectations. Sight screening technology developer Elektron Eye Technology is expected to move into profit. Net cash was £8.5m at the end of October 2018.
Transportation software and services provider Tracsis (TRCS) has received a renewal and extension of data hosting services and software with a rail client. The contract is worth more than £2m over two years.
More bad news from superyacht painting and maintenance services provider GYG (GYG) as 2018 figures are set to be well below expectations that have already been revised downwards. There will be a full year loss on revenues of €44m. There will be no dividend. Refit projects have been delayed and one shipyard undergoing maintenance. New build contracts have been won for 2019. The order book is worth €31.3m, of which €18.2m relates to 2019.
BlueRock Diamonds (BRD) has raised £626,000 at 0.3p a share with every two new shares coming with a warrant to subscribe for a share at 0.4p. The directors have invested £170,000. The cash will be used to open two of the five kimberlite pipes at the Kareevlei diamond mine in South Africa.
Tern (TERN) has invested a further £1.1m in in virtual reality training and data analysis technology platform developer FRVS.
PhotonStar LED Group (PSL) has appointed Menzies as administrator of its subsidiary PhotonStar LED Ltd. That business generated £1.15m of first half revenues of £1.33m. It also made most of the loss. More cash will be required for the remaining subsidiary.
TomCo Energy (TOM) has raised £100,000 at 8.5p and disposed of its stake in Red Leaf Resources for $133,333, which had no value in the balance sheet. This will take cash resources to £335,000. The field test on the Holliday block has been delayed due to a failure of couplings.
Ascent Resources (AST) is still finding it difficult to obtain the permits it is waiting for from the Slovenian authorities so that it can generate revenues from gas. Ascent is considering taking action in the European Court.
N4 Pharma (N4P) says clinical data suggests that its Nuvec technology is suitable for use with multiple antigens. It has delivered mRNA and pDNA in sufficient levels to generate the required immune response. The results of the next study should be available in the first half of 2019.
Wey Education (WEY) reported good results but WH Ireland has downgraded its forecasts for this year and next year. The broker is being more cautious about international growth prospects and cut the 2018-19 pre-tax profit forecast from £1.95m to £1.31m and the following year’s from £5.2m to £3.3m.
Frontier IP (FIPP) has made its second Portuguese investment. Des Solutio is developing greener versions of chemicals used to make beauty, pharma and personal care products. Frontier IP has taken a 25% stake.
Myanmar-focused social media platform operator MySQUAR Ltd (MYSQ) is raising £600,000 at 0.35p a share. Management is focusing on active users and in the first quarter of this financial year there were 412,338 active users of the mobile games offer and 426,750 media and mobile apps users. Last year’s revenues were $1.84m but they need to be much higher than that.
Property investor Safeland (SAF) has acquired North Downs golf club in Surrey for £1.07m and it will invest in the facilities.
Rose Petroleum (ROSE) says that the US Bureau of Land Management has approved the application for a permit to drill the GV 22-1 well on the Paradox acreage in Utah.
MAIN MARKET
Zotefoams (ZTF) has improved revenues by 16% in the nine months to September 2018. Full year profit is expected to be slightly better than anticipated. HPP sales have nearly doubled due to demand from the footwear and aviation sectors. Capacity is being increased.
Books publisher Quarto Group (QRT) has extended its facilities to the end of August 2020. The bank facility has been reduced. Large shareholders have agreed to provide unsecured and subordinated loans of $13m, repayable on 31 August 2020.
Stem cell services provider WideCells Group (WDC) is restructuring its Wideacademy educational subsidiary and closed its London office. Annualised savings are worth £400,000. Alan Greenberg has stepped down from the board.
Social media investment company Sealand Capital (SCGL) has published its full year figures and subsequent interim results. Trading in the shares has recommenced. The SecureCom business has been sold. Sealand has subscribed for a 55% interest in Guangzhou Ruiyou Information Technologies Co, which is a mobile game distributor. It is also party to a licenced operator agreement of the WeChat advertisement product in the UK and UAE. There was £758,000 in the bank at the end of June 2018.
Gems explorer Shefa Yamim (SEFA) has raised £250,000 at 80p a share. The shares each come with one warrant exercisable at 100p a share.
Dukemount Capital (DKE) has gained planning permission for a minor extension on its second property in north west England.
Andrew Hore
Ian Pollard – Uncle Still Thriving On The Impoverished Wealthy
H&T Group HAT expects profit before tax for the full year to 31st December will be above market expectations following a strong fourth quarter in pawnbroking, with quality watches doing particularly well. The pledge book increased by11.6% on a year ago following the higher gold price and the personal loans book rocketed by 94.7%, after the introduction of a lower interest rate, long term product
Micro Focus International MCRO is increasing its interim dividend by 16.4% for the half year to the 31st October and afrer completion of its complex acquisition of HPE Software on the 1st September. The interim figures include results from HPE. as from 1st September. Revenue rose by 80.7% and pre tax profit by 28.7% ( or 33.8% at constant currency rates). Basic earnings per share fell by 9.5% but on an adjusted basis rose by 16%. Micro Focus is confident that its industry leading margins will ensure that it can deliver on its strategy which will be enhanced by further acquisitions.
System 1 group SYS1 (formerly Brainjuicer) After a fall of 9% in first half gross profit, trading in quarter three has continued to be worse than expected and expectations for gross profit for the full year are that it will show a 20% decline on the previous year. Profit before tax for the full year will be only a little over breakeven point. The cas position is however sound with a balance of £4.6m and no debt
Bango BGO saw total End User Spend for the year to 31st December, grow by by 105%, from £132m to 271m. It has also now entered into partnership with Netflix to launch carrier billing for Netflix customers in Mexico, making carrier billing available to over 12 million Mexican customers.
Mattioli Woods MTW The six months to the end of November has produced another period of strong and sustainable growth with EBITDA margins for the first half substantially ahead of the 20% target.
Find beachfront villas & houses for sale in Greece; http://www.hiddengreece.net
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
Spectra Systems – To Significantly Exceed Expectations
Spectra Systems SPSY has been notified by its authentication technology licensee that royalties in 2017 will reach a record level to the extent that profits for the year to 31st December will significantly exceed market expectations. For 2018 it is expected that royalties will continue to be higher than average.
Bioventix BVXP is increasing its second interim dividend from 26p to 31p as well as paying a special dividend of 40p per share. after announcing what it describes as yet another set of excellent results for the year to the 30th June. Revenue for the year rose by 31% and profit after tax by 40%
System 1 Group plc SYS1 Trading for the six months to the 30th September has been slower than expected and in constant currency terms, gross profit is expected to show a 12% decline over the previous year. The company remains cautious about prospects because of what it describes as”our usual lack of revenue visibility”.
ConvaTec Group CTEC Organic revenue growth for the full year will be lower than expected after quarter 3 was severely impacted by a number of issues, including supply problems and lower than anticipated revenue from new products. The implications of growth on margins for 2018 are being reviewed. Third quarter like for like group revenue rose by 3.3% but it is now expected that full year organic revenue growth will be down to between 1% and 2%.
Polymetal Int. plc POLY enjoyed a robust third quarter with gold sales rising by 50% and gold output up by 38%. Total sales for the 3 months to the 30th September rose by 17% and gold equivalent production rose to record levels with a 26% increase over the previous year.
Physiomics PYC suffered from a 9% decline in total income for the year to the 30th June and losses for the year rose by 6%, resulting in the company’s cash position becoming constrained until a deal with a major client can be finalised. Active cost control measures have been put in place.
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Quoted Micro 21 August 2017
NEX EXCHANGE
Good Energy (GOOD) has set the date for general meeting requisitioned by rival renewable electricity supplier Ecotricity, which wants Dale Vince and Simon Crowfoot to join the board. The general meeting will be held on 6 September. Good Energy still believes it would be unwise to have the representatives of its rival on the board.
Via Developments (VIA1) has paid a £412,500 non-refundable deposit on a residential development site in Latimer Road, Luton. Funding still has to be secured for the £8.25m purchase price.
Early Equity (EEQP) has taken a 4% stake in Malaysian multi-level marketing business Early Infinity, which has a distribution agreement with healthcare products supplier Yicom, where Early Equity owns 32.1%. The purchase was funded by the issue of 10 million Early Equity shares. The plan is for Early Equity to buy up to 30% of Early Infinity. Five million Early Equity shares have been issued at 0.6p each to raise £30,000.
Karoo Energy (KEP) has published the competent persons report on the Kalahari Karoo basin shale gas play. There is insufficient data to estimate shale gas or quantify the associated risk. The Lower Ecca shales are broadly correlatable with the source rocks in the broader basin. The low, unrisked estimate of gas initially in place (GIIP) is 310 bscf and Karoo has a 93.475% working interest. The advice is that further exploration is required to improve the understanding of maturity trends and confirm the depths of the Lower Ecca shale.
Lombard Capital (LCAP) has issued a further £55,000 of 7.5% convertible unsecured loan notes 2018, taking the total to £100,000. The conversion price is 10p a share and there are ten warrants for each £1 loan note exercisable at the same share price. There is planning permission for 200 apartments.
Clinigen (CLIN) has approached Quantum Pharma (QP.) about a proposed cash and shares offer. Due diligence has to be undertaken before there is a firm bid. Clinigen is taking advantage of the work that Quantum management has done in selling non-core operations and improving the performance of the rest of the business. Quantum says the interim figures will be brought forward to 22 August.
DX (Group) (DX.) has ended discussions with John Menzies over the merger with its distribution division because suitable terms could not be agreed. There had already been a change in the proposals but this was not enough to make the deal go through. This will mean that DX requires to raise additional funds. The four people that Gatemore Capital wanted to be appointed to the board when it requisitioned a general meeting, later withdrawn, are being proposed as directors and Bob Holt will be leaving the board. Trading in the shares remains suspended.
Oozi Cats has been kicked off the board of Telit Communications (TCM) after it turned out that he withheld information about an indictment against him in the US when the company floated 12 years ago. There have been fears about the cash position of the business but the directors’ have tried to reassure investors. Telit plans to appoint three UK-based non-executive directors.
Tracsis (TRCS) has reassured investors that it should hit market expectations for 2016-17. This means that pre-tax profit will be better than the £6.9m reported in the previous year. Tracsis had warned that the second half would have to be strong in order to make the forecast and this has happened. There was £15m in the bank at the end of July 2017. A reorganisation of the traffic and data services division should improve margins this year. The full year results will be reported in November.
IDOX (IDOX) is acquiring electoral back office software provider Halarose for £3.5m in cash and £1.5m in shares. This will boost the market share of IDOX in the UK elections market and there should also be cost savings.
Wilmcote Holdings (WCH) is the latest shell backed by Marwyn to join AIM. The £15m raised will be used to seek significant acquisitions in the chemicals sector. The share price rose from 120p to 132.5p. Former Synthomer boss Adrian Whitfield is chief executive.
Market research firm System1 Group (SYS1) stunned the market with a profit warning that sent its shares down nearly one-third. The former BrainJuicer announced at its AGM that the lack of a repeat of a large contract last year means that gross profit could be up to 11% lower in the first half of this year. On top of this costs are rising. The interim figures are likely to show breakeven compared with a £2.8m profit in the first half of the previous year. Full year pre-tax profit could fall by up to 15% from last year’s level of £6.3m.
Bushveld Minerals Ltd (BMN) says that a study carried out in conjunction with the Industrial Development Corporation shows strong vanadium redox flow battery technology in Africa with the market peaking by 2025-2030. Global electrolyte demand is likely to peak at the same time at 1200-1800 MWh. There is potential for Bushveld to supply 200MWh of storage per annum and a study is being undertaken for a potential vanadium electrolyte production plant in South Africa. Vanadium mining and related battery technology is the focus for Bushveld. There was a small net cash position at the end of February 2017.
Malvern International (MLVN) reported a reduction in interim loss from £460,000 to £395,000 as revenues slumped from £2.07m to £1.65m. Malaysian revenues fell but operating costs were reduced. There is £360,000 in the bank. The loss in Singapore has been reduced and that was before EduTrust certification, which is required to enrol international students, was reinstated. There has been year-on-year growth of 17% in London revenues and the loss was sharply reduced. House broker WH Ireland is not publishing forecasts at the moment.
Pawnbroker H&T Group (HAT) reported a 62% increase in first half pre-tax profit to £6.2m and the interim dividend was raised by 10%. H&T has been compared with Ramsden (RFX) but the mix of operations and revenues is very different.
Connemara Mining (CON) has raised £200,000 via a placing at 1.75p a share and each new share has a warrant to subscribe for an additional share at 3.42p each. Patrick Cullen has been appointed as chief executive of the gold and zinc explorer.
Red Leopard Holdings (RLH) is in talks to acquire a coal project in Colombia. Red Leopard will have to issue shares with a minimum valued of $180m in order to acquire the La Luna project. Trading in the shares is suspended.
MAIN MARKETS
Stem cell services and insurance provider WideCells Group (WDC) has raised £750,000 at 14p a share and the cash will be used to finance growth in the three operating divisions. Positive news has helped to boost the share price over the past two months. This includes the granting of a research licence by the UK Human Tissue Authority. The CellPlan insurance product is on sale and a digital platform is being developed for the educational division, WideAcademy.
Myanmar Strategic Holdings Ltd (SHWE) has raised $423,000 at $10 a share, while $3.9m of loan notes have been converted into shares. The focus is on hospitality and education sectors. The company already operates three hostels in Myanmar and it has acquired the rights from Pearson to open English language centres. Last year, revenues were $330,000 and the loss was $2.38m. Dealings are due to commence on 22 August.
Pembridge Resources (PERE) is set to move from AIM to the standard list on 21 August. It has raised £2.27m at 1.6p a share. The move will provide more time for Pembridge to build up a portfolio of mining investments without worrying about doing this within the timescale required on AIM.
Quarto (QRT) has ended bid negotiations with an unnamed bidder less than a fortnight after revealing the talks. One of the stumbling blocks was the regulatory approval required by the bidder and the book publisher’s management did not want to be distracted from trading by a bid that could take a long time to come to fruition. This is despite the fact that the bid proposal was at an attractive premium.
Bluebird Merchant Ventures (BMV) has located the three historic entry points to the Gubong gold mine in South Korea. This will enable access to five of the veins that were previously mined when the gold price was much lower.
Andrew Hore
Majestic Wine Reaps The Rewards
Majestic Wine WINE claims it is reaping the rewards of its transformation plan with second half profits up by 51% and the restoration of a final dividend being proposed with a payment of 3.6% compared to zero last year. Both operationally and financially it claims it is past the tipping point but the figures still have to be taken in context. The company has made a loss for the year of £1.5m compared to last years profit of £4.7m and on an underlying basis adjusted profit before tax on a year by year basis fell by 29.2% and EBIT by 28.4%.
As transformation benefits work their way through, the target is still for sales of £500m by 2019 and analysts current profit forecasts are expected to be met, despite the continuation of difficult trading conditions.
System1 Group SYS1 Produced strong results for the year to the 3rd April December and, because of a change in the year end,also for the 15 months to 31st March. The final dividend is to jump from 3.5p per share to 6.4p, on top of which there will also be a special dividend of 26.1p per share. The company formerly known as Brainjuicer won, for the sixth consecutive year, the award for being the most innovative company of the year.
For the 12 months to 21st December revenue rose by 24% on a constant currency basis, profit before tax by 38% and earnings per share by 33%. comparative figures are not provided for the 15 month period to the new year end. The first quarter of the new financial year has been a little slower than the company expected.
Atkins WS. ATK claims a year of strong financial and strategic progress with significant growth in the US. Revenue grew by 11.8% on a constant currency basis and underlying profit before tax for the year 31st March was up by 18.4% and diluted earnings per share by 26.1%.
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