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Quoted Micro 7 November 2022
AQUIS STOCK EXCHANGE
Cooks Coffee Company Ltd (COOK), which was already quoted on the New Zealand Stock Exchange, joined Access segment of Aquis on 2 November at 20p a share. The share price rose to 21.5p (20p/23p) by the end of the week. There were no trades during the week. The company owns the Esquires Coffee and Triple Two Coffee brands. It has 111 outlets around the world, including 70 in the UK, making it the largest franchise café chain in the UK. Elena Garside has been appointed as a non-executive director.
Brewer Daniel Thwaites (THW) more than doubled interim pre-tax profit from £7.5m to £15.7m, although most of the improvement came from a gain on interest rate swaps of £7.6m, up from £500,000, due to higher interest rates. Turnover was 21% ahead at £57.9m, although trading was disrupted in the corresponding period. Net debt was £61.1m at the end of September 2022. The performance of pubs is mixed, and beer volumes are not back to past levels. Higher hotels revenues were more than offset by increased costs.
Quantum Exponential Group (QBIT) investee company Universal Quantum says its German subsidiary has been commissioned by the German Aerospace Centre to build a fully scalable trapped-ion quantum computer. This follows projects supported by the UK government. Non-exec director Nigel McNair Scott has acquired 500,000 shares at 2p each, 1.5 million shares at 1.966p each and 500,000 shares at 1.95p each.
Valereum (VLRM) has gained regulatory approval for the acquisition of the Gibraltar Stock Exchange and the deal should be completed in the first quarter of 2023. Smaller companies in the Middle East, India and Africa. The plan is to attract An NFT strategy will be launched next year. Simon Brickles is chairman of the Gibraltar Stock Exchange, and he will join the Valereum board. There has been the conversion of £130,000 of the funding facility into shares. There is an outstanding balance of $2.35m.
Eight Capital Partners (ECP) wants to raise up to £10m from a placing at 0.02p a share. The shares will come with warrants exercisable at 0.05p. The cash will be used for fintech acquisitions. Supplying financial services to smaller companies is an area that management believes is underserved. Wealth management technology is another potential area. Acquiring a digital bank could provide a base to grow into these areas. A broker option will enable existing shareholders to buy shares, and this is open until 21 November. Bondholders will be given the chance to convert into shares.
Quetzal Capital (QTZ) has a conditional agreement to acquire the shares it does not own in TAP Global for 450 million shares. The deal requires a fundraising to finance the enlarged group. This has led to the suspension of trading in Quetzal Capital shares.
Wind and water-based green hydrogen production systems developer Hydrogen Future Industries (HFI) has commenced prototype testing of the wind element of the system. The wind turbines are designed to be more efficient, and the tests will show whether they achieve expected power output.
VVV Resources Ltd (VVV) has raised £241,000 at 20p a share and every four shares come with a warrant exercisable at 50p a share. The share price slumped 55% to 22.5p because of the placing’s large discount to the market price. VVV Resources has a conditional agreement to acquire 100% of the Mitterberg copper project in Austria and 49% of the Shangri La polymetallic project in Western Australia.
Cadence Minerals (KDNC) says the Amapa ore reserve estimate supports a 15-year mine life and Cadence has increased its stake in Amapa to 30% by converting loans and capitalising management and admin contributions. Investee company Evergreen Lithium is moving towards an ASX listing.
Rogue Baron (SHNJ) sold 660 cases of whisky generating $87,000. Sales have slowed in the US ahead of a move to a larger distributor. Rogue Baron is selling its De Rhum Spot bar.
Semper Fortis Esports (SEMP) generated revenues of £55,000 in the six months to July 2022. There was a £694,000 cash outflow during the period, leaving cash of £635,000. Overheads have been reduced.
Dynasty Gaming & Media, which is an investee company of AIM-quoted Blue Star Capital (BLU) will deliver new games developed by Pioneer Media Inc (PNER), to Asian telecoms company Indosat Ooredoo Hutchison, which has 100 million subscribers in Indonesia.
TruSpine Technologies (TSP) has been approached with an equity financing package. More cash is required for working capital.
There has been more buying of property investor Ace Liberty & Stone (ALSP) shares by chief executive Ismail Ghandour. He acquired 20,000 shares at an average price of 0.595p each. Brewer Shepherd Neame (SHEP) director Richard Oldfield is continuing to buy shares. He acquired at total of 9,500 shares at 680p each. Coinsilium (COIN) chief executive Eddy Travia bought 250,000 shares at 1.9p each.
MiLOC (ML.P) is changing its name to Crushmetric Group.
AIM
Accsys Technologies (AXS) will report a significant impairment charge relating to the restructuring of the Tricoya consortium. Accsys Technologies intends to take 100% ownership of the Hull Tricoya plant, and construcgtion is going to be put on hold for six months. That will reduce the cash outflow. The restructure means that the consortium partners will receive 11.9 million Accsys Technologies shares. The debt facility will be restructured with the principal reduced from €15m to €6m. The plant may cost €35m to complete. A decision on construction will depend on the assessment of the longer-term outlook for costs. The fourth reactor at the Netherland Accoya plant will increase cash generation.
Shield Therapeutics (STX) says the Korean Food and Drug Administration has agreed to a single pharmacokinetic study for a new drug application for iron deficiency product Accrufer. This should start before the end of the year. Korea Pharma will conduct the survey and regulatory approval could be gained before the end of 2023.
Science Group (SAG) is buying the shares it does not own in TP Group (TPG) for 2.25p a share in cash. That values TP Group at £17.5m. Science Group already owns 28% of the company.
Oil and gas producer Hurricane Energy (HUR) has received an indicative bid of 7.7p a share but does not recommend this offer. Instead, a formal sale process has started because 28.9% shareholder Crystal Amber Fund Ltd (CRS) is keen to sell its stake. Hurricane Energy is generating cash and has more than $370m of tax losses. If there is no bid a 3.1p a share distribution is planned.
Rising costs have meant that paper manufacturer James Cropper (CRPR) with energy costs having a significant effect on paper making. The technical fibres business is not growing as fast as anticipated. Price rises are offsetting some of the cost increases. The full year pre-tax profit estimate has been cut from £5.4m to £2m, after breaking even in the first half to 24 September 2022.
Empire Metals (EEE) says the mapping of the Pitfield copper project show extensive copper, silver and other base metals anomalies over a 40km strike length. Exploration field work will start by the first quarter of 2023.
MAIN MARKET
Bowen Fintech (BWN) is a standard list shell that is seeking fintech acquisitions, such as digital payments and trading platforms, anywhere in the world. The initial focus is Europe, Asia and the US. A business that is already generating revenues with potential for growth would be ideal for Bowen Fintech. A placing raised £2m at 4p a share. There were no trades on the first day and then two on the following day. There were two more deals on Friday. The share price ended the week at 6.25p (5p/7.5p). That is nearly double the pro forma NAV of 3.2p a share.
Vox Capital has reversed into standard list shell Vertu Capital Ltd to form Vox Valor Capital Ltd (VOX) and trading recommenced on 31 October. Vertu Capital issued 2.2 million shares at 1.2p each to acquire London-based digital marketing and technology business Vox Capital, which equates to 93.9% of the enlarged share capital. However, the share price opened well below the issue price and has fallen to 0.6p (0.5p/0.7p).
National World (NWOR) is considering a bid for Daily Mirror owner Reach (LON: RCH), although it has not made an approach.
Andrew Hore
Quoted Micro 14 February 2022
AQUIS STOCK EXCHANGE
Good Energy (GOOD) has repelled the latest attempt by major shareholder Ecotricity to influence decisions. It wanted to remove the chairman and stop the sale of generation assets without shareholder approval. Both resolutions were defeated.
Dominique Einhorn has resigned as chief executive of ChallengerX (CXS) following his arrest in France for tax and other offences. ChallengerX joined Aquis in December after it acquired SportsX, which provides marketing services to rugby and football clubs. Sarlat Rugby, which is 100%-owned by Dominique Einhorn, is one of the first clients. The share price was unchanged at 2.4p (2.2p/2.6p).
Hydro Hotel Eastbourne (HYDP) increased revenues from £2.23m to £2.79m in the year to October 2021 and that enabled it to move from a loss of £174,000 to £457,000. This was helped by government assistance. Trading is still not back to pre-pandemic levels. There is £1.33m in the bank.
EPE Special Opportunities (ESO) had net assets of 455.66p a share at the end of January 2022. There was £27.6m of available funds at the end of January. Directors and managing partners bought shares, but more were sold by others.
Cadence Minerals (KDNC) has completed the purchase of a 20% stake in the Amapa iron ore project.
Gowin New Energy (GWIN) is considering trading in agarwood products, including incense and oils in Taiwan. A trial is being launched ahead of the Quingming festival.
Quantum Exponential (QBIT) investee company Arqit Quantum has signed a research and development agreement with the United States Air Force. This could lead to a quantum encryption service for the Department of Defense.
SulNOx (SNOX) plans to gain an OTC quotation in the US so that Americans can invest.
SuperSeed Capital Ltd (WWW) managing director Mads Jensen has bought 3,000 shares at an average price of 83.9p. SuperSeed raised £2m at 100p a share at the end of January. The share price ended the first week at 70p (65p/75p) and it remained at that quoted price last week with limited trading volumes.
Samarkand (SMK) non-exec Phil Smiley acquired 28,777 shares at 139p a share. Daniel Thwaites (THW) director RAJ Bailey bought 15,000 shares at 102.25p a share. Chris Akers has increased his stake in Quetzal Capital (QTZ) from 17.2% to 18.3%.
Alfred Henry has resigned as corporate adviser to Lombard Capital (LCAP).
AIM
Building products supplier Alumasc (ALU) reported that interim pre-tax profit fell 12% to £5.1m on revenues 2% ahead at £46.3m. The profit fell because shading business Levolux fell back into a loss of £1m. Roofing did well but the Levolux business held that division back. The water management division sales were nearly one-fifth higher, and profit improved. Housebuilding product sales increased but margins fell. However, the second half should be stronger.
Self-storage sites operator Lok’nStore (LOK) says that first half trading was strong. Interim revenues are one-third higher, helped by higher occupancy and prices.
Orchard Funding Group (ORCH) has launched a bond offer and it is guaranteeing 10% of face value of outstanding bonds. The Orchard Bond Finance bond offers an annual interest rate of 6.25% payable twice a year. The repayment date is 2027. The cash from the bonds will help to finance growth. The offer is open until 23 February. The offer is available through PriamryBid and intermediaries, such as Interactive Investor and AJ Bell. The minimum subscription is £2,000. The bonds will be issued on 2 March and trade on the Official List.
Sustainable investments company i(x) Net Zero (IX.) raised £10.7m at 76p a share. The share price ended the week at 77p, which is a premium to pro forma net assets.
ASX-listed Artemis Resources (ARV) joined AIM and raised £5m at 3.75p a share on 7 February. It owns 100% of the Greater Carlow gold copper cobalt project and the Paterson Central gold copper exploration project in Western Australia. Exploration commenced at Paterson Central in November 2021, and it is expected to resume in March. The Paterson Central project is adjacent to the Havieron project that is being developed by Newcrest Mining and Greatland Gold (GGP). Greater Carlow has a JORC complied mineral resources estimate for its Carlow Castle deposit of 14.3Mt @ 0.7g/t gold, 0.4% copper and 0.05% cobalt. An update is expected by the summer. The share price ended the week at 3.875p.
Filtronic (FTC) grew ongoing interim revenues by 12% to £8m and the telecoms components manufacturer moved back into profit. The full year pre-tax profit forecast is being maintained at £1m even though revenues have been edged up to £18m because the improvement is from lower margin products. Defence spending is boosting demand.
Omega Diagnostics (ODX) is raising £5m and could raise a further £2m from an open offer. It is also selling its manufacturing facility in Alva for £1m after it failed to win a Covid diagnostics contract. Even so, Omega is expected to continue to lose money. The CD4 diagnostics operations will be transferred to the Ely site and sales are building up, Health and nutrition business continues to grow.
Kitwave (KITW) has acquired West Country-based MJ Baker, which distributes ambient, chilled and frozen food. This is the first acquisition since flotation and Kitwave is paying £24.5m in cash. This deal includes own branded Bakers Best Buy products and should be earnings enhancing.
Recent new admission Facilities by ADF (ADF) has already sparked a forecast upgrade from a trading statement. The film and TV hire services provider is expected to make earnings of 4.5p a share for 2021.
Dekel Agri-Vision (DKL) continues to generate increasing revenues from crude palm oil, but it is taking longer than expected for cashew revenues to grow. January was a record month for production and extraction rates improved, while prices rising. The cashew plant is using 15% of capacity and waiting for additional components.
Mergers and tax adviser K3 Capital (K3C) increased interim revenues from £17.6m to £31.2m providing a significant boost to profitability. The interim dividend is 4p a share. K3 is on course for a full year pre-tax profit of £17.7m, up from £13.6m, providing the ability to potentially pay a total dividend of 12.1p a share.
MAIN MARKET
S and U (SUS) is paying a second interim dividend of 36p a share. Group debt is £114m out of possible facilities of £180m. There was a reduced level of bad debts in the year to January 2022 and pre-tax profit will be more than double last year’s £17.2m. Advantage has started to finance electric vehicles. Net loan advances are £140m. Property bridging has a loan book of £64m.
Anglesey Mining (AYM) plans to move to AIM. A general meeting will be held on 8 March to gain shareholder approval.
Sure Ventures (SURE) has net assets of 118.34p a share.
Andrew Hore
Quoted Micro 8 November 2021
AQUIS STOCK EXCHANGE
There are three companies on the shortlist of the AQSE company of the year award at the Small Cap Awards 2021. They are medical IT provider DXS International (DXSP), oncology and dermatology treatments developer Incanthera (INC) and Kent-based wine maker Chapel Down Group (CDGP).
Brewer Daniel Thwaites (THW) was hampered by lockdowns in the six months to September 2021, but they were not as bad as in the first half of the previous year. Revenues increased from £221.8m to £47.8m, while the business returned to profit with £7.5m before tax. Net debt was £61.4m at the end of September 2021. Government support has come to an end and there are inflationary pressures, only partly offset by beer duty changes.
Quantum Exponential (QBIT) is a shell focused on quantum technology and predominantly companies in NATO countries. There are no other quoted companies offering a potential investment in this sector. The plan is to put together a portfolio of quantum technology company investments, which are most likely to be at the seed or early stage. Quantum computing uses the laws of quantum physics to increase the speed of computation. Nearly £2.5m was raised after expenses at 5p and the share price ended the week at 6.625p (6.25p/7p). The NAV is 1.65p a share, so the current share price is more than four times that level. Helium Special Situations has taken a 4.57% stake.
Kashei Holdings (KASH) intends to build up a portfolio of investments in cryptocurrencies and blockchain. The portfolio will include digital assets, listed investments, venture capital opportunities and staking digital assets into liquidity smart contracts and perform staking services. There should be around £3.7m available for investment, although 10% of that will be required for working capital, following the placing at 16p a share. The current mid-price is 20.25p (19.5p/21p). Pro forma NAV is 13.1p a share.
Samarkand Group (SMK) is acquiring Napiers the Herbalists, which it has been trading with for three years. The initial consideration is £1.7m in cash with deferred consideration of £100,000. There is also contingent consideration of up to $700,000. In the year to March 2021, revenues were £1m and EBITDA was £240,000.
All Star Minerals (ASMO) signed exclusive heads of terms with a company with gemstone assets and another company with diamond assets. It has terminated the gemstone deal and extended the potential diamond deal. The potential acquisition has white and coloured diamonds and an off-take and financing agreement. Ian Harebottle, the interim chief executive of All Star Minerals, owns 25% of the diamond company.
Vulcan Industries (VULC) has signed heads of terms to acquire Aftech, which is a sheet metal fabrication company that fits in with existing subsidiaries. Aftech has net assets of £780,000 and net debt of £90,000. Full year revenues are estimated to be £1m with EBITDA of £175,000. Vulcan will pay £1.55m in shares and this may represent 21.5% of the enlarged share capital.
TruSpine Technologies (TSP) has submitted a request to the FDA to consider the Cervi-LOK system as a breakthrough device technology. That would enable the device to generate higher margins.
Coinsilium Group Ltd (COIN) had crypto assets of $4.22m at the beginning of November 2021. That is more than double the value at the end of June.
Rutherford Health (RUTH) increased interim revenues by 36% to £4.85m in the six months to August 2021. September revenues were more than £1m. More oncologists have been trained to use the company’s technology. Rutherford Health will continue to lose money.
Pioneer Media Inc (PNER) has acquired CryptoPunk 8869 for $433,700.
Asia Wealth Group Holdings (AWLP) increased interim revenues from $894,000 to $940,000, while pre-tax profit improved from $117,000 to $123,000. There was $1.36m in the bank at the end of August 2021.
AIM
Online electrical retailer Marks Electrical (MRK) specialises in kitchen appliance, audio visual products and small electrical appliances and has been growing its share of the market. Since 2014, Marks Electrical has increased its market share from 0.41% to 1.22%. A placing raised £2.63m after expenses at 110p each and shareholders sold shares worth £25m. The company’s warehouse has enough capacity to cope with revenues of £180m, more than treble last year’s level. The shares ended the first day at 110.5p.
Devolver Digital Inc (DEVO) is the latest video games publisher to join AIM. The Delaware-based company’s original focus has been indie games produced by third parties, but more recently it has been acquiring companies with their own IP. The cash raised by the company in the placing will be used to acquire strategic partners and finance the development of third party and in-house games. Nearly £30m was raised after expenses and the price has risen from the placing price of 157p to 187.5p. The overall video games market is forecast to grow from $177.8bn to $218.7bn in 2024.
Escape rooms operator Escape Hunt (ESC) is acquiring Boom Battle Bars, which offers competitive socialising activities along with drinks and food. The total cost is £17.38m, with £9.88m in cash and deferred consideration of up to 25 million shares. The shares are subject to an earn-out based on revenues number of sites open. Escape Hunt raised £15m at 30p a share and could raise up to £2.2m from a one-for-12 open offer at the same share price. The acceptance date is 19 November. The enlarged group will be renamed XP Factory.
Self-storage sites operator Lok’nStore (LOK) had a much more significant than forecast uplift in its NAV at the end of July 2021. It increased from 555.5p a share to 731.1p a share. This year the dividend has been raised by 2p a share to 15p a share. The additional sites in progress will add 38% to space over the next few years.
Bleepa communications technology developer Feedback (FDBK) is raising £10m in a placing at 0.7p a share to take advantage of opportunities and finally build up revenues. There is also a one-for-15 open offer to existing shareholders that can raise up to £500,000 more. The CareLocker technology that is being piloted in Sussex could be a game changer. Combined with Bleepa it can store patient records individually in the cloud instead of in one place where it is easier to hack.
Gensource Potash (GSP) was already quoted on the Toronto Venture Exchange before joining AIM, and its focus is the Tugaske potash project in Canada. Gensource owns 67% of the vehicle that owns the project and has arranged finance to cover the C$352m cost of building the mine. The Tugaske project’s proven and probable mineral reserve is 14.1 million tonnes and there is a likely minimum expected mine life of more than 56 years, based on annual production of 250,000 tonnes of saleable muriate of potash. The share price ended the first day at 27.5p.
Remote tracking and monitoring technology provider Starcom (STAR) is changing its name to t42 IoT Tracking Solutions and rebranding its products. There will also be an eight-for-one share consolidation.
MAIN MARKET
In the six months to August 2021, Braemar Shipping Services (BMS) revenues grew by 11% to £47.4m, while pre-tax profit improved from £4.47m to £4.92m. The order book is 28% ahead at $55.5m. Net debt has fallen to £14.7m. There is a 2p a share interim dividend.
IT services provider Triad Group (TRD) reported a decline in interim revenues, but pre-tax profit jumped from £1,000 to £670,000. There is a 2p a share interim dividend. There is cash of £5.34m. high utilisation levels are continuing.
Andrew Hore
Andrew Hore – Quoted Micro 5 July 2021
AQUIS STOCK EXCHANGE
Voyager Life (VOY) is an early-stage company offering CBD-based products – including chewable sweets, bath products, oils and skincare products. The company has been in existence for around eight months and revenues are small. The first high street shop will be opened in St Andrews during July. Voyager Life raised £400,000 at 58p a share, but by the end of the first week of trading the share price has fallen to 40.5p (39p/42p) – possibly because of trading by crowdfunders that bought at 31p a share. Proforma cash appears to be around £2.4m, but there will have been expenses since the end of March. Greencare Capital (GRE) invested £100,000 and it is currently worth around £107,000.
Samarkand (SMK) reported 2020-21 revenues of £20.6m, including exceptional revenues of £5.8m, up from £6.8m. This enabled the ecommerce technology provider to make a positive EBITDA. There was £14.6m in the bank at the end of March 2021. A Tokyo office was opened in June. The full year results will be published before the end of July.
Revenues fell by more than two-thirds at pubs and brewery operator Daniel Thwaites (THW) and they were £32.2m in the year to March 2021. There was a swing from profit to loss. Net debt increased to £78.8m with monthly cash burn running at £1.5m during lockdown. There were £11.2m of additional bank facilities available and there have been subsequent disposals of non-core properties.
Polygon Global Partners has taken its stake in Watchstone Group (WTG) to above 30% and it is making a mandatory bid at 34p a share, valuing the company at £15.7m.
KR1 (KR1) increased its NAV from 5.72p a share to 28.97p a share at the end of 2020. Non-exec director Rhys Davies has exercised options over 767,236 shares at 19.55p each, which raised £150,000 for the company.
In 2020, Coinsilium Group (COIN) made a pre-tax profit of £310,000, compared with a loss of £259,000. That was mainly due to unrealised gains. The cash outflow from operating activities increased from £496,000 to £788,000. There was £173,000 in the bank.
NFT Investments (NFT) has conserved its cash despite declines in cryptocurrency values. It made a $440,000 gain on crypto token investments but has exited the market for the time being. There is still £34.1m of cash and stable coin, which is deemed to be less volatile because their value tends to be linked to the dollar, in the balance sheet, compared with a market value of £25.6m at 2.55p. How that figure is split between cash and stable coin is not stated.
In the nine months to December 2020, British Honey (BHC) generated revenues of £1.5m. Union Distillers was acquired in February 2021. There was cash of £2.95m at the end of March 2021.
Rogue Baron (SHNJ) has opened a second bar in Washington DC, called De Rhum Shot, and it is three times the size of the existing bar. Rogue Baron is investing £90,000 for a 51% stake and it is committed to a further payment of £20,000. Sales of Shinju whisky should reach 5,000 cases in 2021.
Secured Property Developments (SPD) had cash of £457,000 at the end of 2020 and net assets were £175,000. Management is seeking investment opportunities.
Chris Akers has taken a 3.09% stake in DiscovOre (ORE).
Valereum Blockchain (VLRM) completed the £1m placing at 70p a share.
AIM
Wynnstay (WYN) has gained market share in the animal feed market and the milk price remains at a level that provides confidence to farmers helping the retail operations to grow. In the six months to April 2021, revenues rose from £229.3m to £249.7m. Raw material prices have increased but Wynnstay has been able to pass them on and improve gross profit from £31.5m to £33.3m, which is the important measure. Underlying pre-tax profit improved from £4.5m to £5.5m. The interim dividend was raised by 9% to 5p a share.
The restructuring of Huricane Energy (HUR) has been rejected by the courts and that effectively means that the company has defaulted on the planned convertible bond repayments. The non-exec directors have resigned, and two directors appointed to replace them.
Digital marketing services and technology provider Silver Bullet Data Services (SBDS) raised £9.5m at 257p a share when it floated. This will be spent on further development of its 4D technology that helps brands to target advertising. 4D has been developed as an alternative to cookies that remains in line with current and likely regulations.
Specialist cleaning company React Group (REAT) increased interim revenues from £2.09m to £2.51m, while underlying pre-tax profit improved from £50,000 to £74,000. Fidelis was acquired too late in the period to make a significant contribution. Full year pre-tax profit is expected to increase from £188,000 to £784,000.
MAIN MARKET
Bermele (BERM) has agreed the acquisition of premium mixers supplier East Imperial Pte for £24.45m and it will be changing its name to East Imperial and raising £3m at 10p a share.
In 2020, Lookers (LOOK) increased its underlying pre-tax profit from £4m to £14.1m. The motor dealer is making annualised savings of £50m.
Highway Capital (HWC) says that it has whittled down potential acquisitions to a small number and is in discussions with one target. There is £41,000 in cash and net liabilities of £1.13m.
Wildcat Petroleum (WCAT) is focusing on Angola and Namibia in its search for oil and gas assets.
Media Tech SPAC is raising cash via Primary Bid ahead of a standard listing later this summer. The company wants to raise up to £6m at 10p a share. Areas of interest include digital technology, cyber security, social media, content distribution, virtual reality, gaming and interactive entertainment. Media Tech SPAC has previously raised £415,000 at 1p a share and £1.64m at 4p a share.
Ross Group (RGP) lost £1.46m in 2020. Net liabilities are £5m. Ross has acquired an aquaculture business, but it is yet to benefit from the investment put into this business.
Andrew Hore
Andrew Hore – Quoted Micro 28 December 2020
AQUIS STOCK EXCHANGE
TruSpine Technologies (TSP) has delayed the application for FDA approval of its Cervi-LOK spinal device for up to three months. This is due to a lack of testing time because of Covid-19. Computer modelling has enabled the company to make minor modifications, which widens the market for the device. A £250,000 cash injection is expected by 5 January.
Daniel Thwaites (THW) reopened its pubs in early July and up until the end of September sales were running at three-quarters of the previous year. Due to the lockdown in the first three months of the period, the interim revenues were 59% lower at £21.8m and the business moved into loss. Net debt was £66.6m at the end of September 2020. There are total borrowing facilities of £90m.
KR1 (KR1) has made two more investments. There is a $200,000 investment in Tidal Finance in return for 222,222,222.22 Tidal tokens. A further $200,000 is invested in HydraDX and the number of tokens has not been determined as yet.
Coinsilium Group Ltd (COIN) has more than £1m of cryptocurrency and tokens with a further $127,000 of RIF tokens due to vest over 23 months.
Tectonic Gold (TTAU) has drilled 11 holes at the Specimen Hill prospect in Queensland. Gold/ copper/silver mineralisation was intersected in the first three holes. The other eight holes have similar characteristics.
Belvedere Leisure (BELV) has entered into an exclusivity agreement to purchase the 160 acre site known as Barnsoul Park in Dumfries and Galloway for £1.4m. The deal is subject to due diligence and 12 weeks after completion there are plans to install at least 28 lodges as part of an upgrade of the park. Bookings will be taken for June 2021 onwards if the deal goes ahead. In two years, there should be more than 150 lodges.
Upper Thames Holdings (UPPT) has non-binding heads of agreement for the purchase of a 10% stake in Sweden-based Ridercam, which supplies mobile camera systems for theme park rides.
Gunsynd (GUN) says that Angold Resources has completed the acquisition of Federal Gold Corp and trading in Angold shares will begin on the TSX Venture Exchange on 31 December. Gunsynd owns 712,500 shares.
Newbury Racecourse (NYR) has appointed Allenby Capital as its corporate adviser.
AIM
Applegreen (APGN) is recommending a €5.75 a share bid from the company’s founders, which values the company at €718.1m. The roadside convenience retailer floated on AIM in 2015 at 277p a share. Applegreen has 559 sites.
Coral Products (CRU) its core mouldings business at Haydock and Interpack to One51 ES Plastics for £7.9m. That is nearly as much as the current market capitalisation, while pro forma net cash is expected to be £6.6m. One51 acquired Straight in 2014. Coral will still own the Haydock freehold and the annual rent will be £300,000. The deal required shareholder approval because it is deemed to constitute a change of business. The remaining subsidiaries are Tatra Rotalac, which produces plastic extrusions and mouldings, and Global One Pak, which supplies lotion pumps and trigger sprays. They generated full year revenues of £5.4m and are profitable prior to central costs. Pro forma NAV is £13.6m.
Equatorial Palm Oil (PAL) has agreed to acquire Capital Metals for £15.8m. The company is raising £2.09m at 12p a share (following a 20-for-one consolidation). Capital has an interest in the Eastern Minerals project in Sri Lanka. There is a JORC resource of 17.2Mt with an average grade of 17.6% total heavy minerals. The Environmental Impact Assessment should be published soon. First production could be in 2022.
Hargreaves Services (HSP) has sold its remaining speciality coal stocks to its German joint venture company for £24m. Hargreaves will market the coal on the joint venture’s behalf for commission. There will be a £3m goodwill write-off, but the profit impact should be neutral.
Duke Royalty Ltd (DUKE) has exited its investment in IT firm Welltel (Ireland) for £15.4m. This represents an IRR of 27%. There have been follow-on investments in two other royalty companies. Duke has invested £3.1m in recreational vehicle parts wholesaler MRDB, which will use the cash to help buy vendor loan notes for £4.9m. Duke will own 30% of MRDB. Monthly payments will be £147,000. A further £1m has been invested in Irish insurance brokerage company BHPC.
IXICO (IXI) has secured a £3.4m contract to provide data analytics services for rare neurodegenerative condition, SCA3 (Machado-Joseph disease). This will last more than four years.
Driver Group (DRV) chairman Steven Norris has bought 46,000 shares at 53.5p each. He owns 293,062 shares.
Sutton Harbour (SUH) has purchased a 1.5 acre site to the east of Sutton Harbour. Two residential developments totalling 200 units are planned for the site. A planning application has been submitted for another residential and commercial development at Sugar Quay. The company has also gained permission for event pontoons in the harbour.
Microsaic Systems (MSYS) has not received a definitive offer and the board has decided to end bid talks. It has also failed to secure the cash it requires and KRE Corporate Recovery has been appointed to advise on alternatives, such as selling assets. There is a possibility that an administrator may be appointed.
TMT Investments (TMT) received $40.9m for its stake in CRM company Pipedrive Inc and this increases its cash to $42m. It will repay the shareholder loan of $3m.
MAIN MARKET
Residential developer One Heritage Group (OHG) has raised £930,000 at 10p a share when it joined the standard list. This valued the company at £3m. The shares ended the week at 11p. The initial focus is north west England and One Heritage redevelops and refurbishes buildings and has a lettings operation. The company has a marketing network in Hong Kong and also sells developments to institutional investors.
Standard list shell Pineapple Power Corporation (PNPL) raised £1.3m at 3p a share. The focus is renewable and clean energy. The share price increased to 3.25p.
Construction and water infrastructure company nmcn (NMCN) says that its full year loss will be £16.5m. That includes £5.3m of prior year adjustments. There should be a small cash outflow. The one bright area is telecoms, where capital investment by clients increased. The order book is valued at £200m. Shore Capital has been appointed broker.
Andrew Hore
Andrew Hore – Quoted Micro 23 November 2020
AQUIS STOCK EXCHANGE
Daniel Thwaites (THW) had a strong eleven months in the year to March 2020, but the final month was unsurprisingly poor for the brewer and pubs operator. Full year revenues edged up from £96.9m to £98.1m, while pre-tax profit fell from £4.5m to £3.6m. Net debt was reduced from £69.7m to £65.4m, helped by property disposals. No dividends are planned in the near future.
EPE Special Opportunities (ESO) has taken advantage of the strong Luceco (LUCE) share price and sold four million shares for total proceeds of £10m. EPE still owns a 24.9% stake.
KR1 (KR1) has participated in token generation by four platforms. There was a follow-on participation in a Plasm Network distribution event, while KR1 has also received tokens from ChainX, Edgeware and Phala Network. The Phala Network tokens have been sold for nearly $124,000.
BWA (BWAP) has given St George’s Eco-Mining Corp until 27 November to repurchase the company’s investment in Kings of the North Corp.
Tectonic Gold (TTAU) says that the first hole drilled at the Specimen Hill prospect in Queensland has signs of gold bearing mineralisation. A second hole is underway.
Evrima (EVA) and partner Power Metal Resources (POW) have published a drilling update for the Molopo Farms complex in Botswana. The first hole has been completed at the nickel sulphide and platinum project. This confirmed that it is a feeder zone. Samples will be tested. There is a four-hole drilling programme.
Cadence Minerals (KDNC) owns 30% of mining and exploration leases that form part of the Yangibana rare earth deposit. Drilling has confirmed that recent drilling results show an economic mineralised corridor 8km long.
Gledhow Investments (GDH) has taken a 4.82% stake in IamFire (FIRE).
NQ Minerals (NQMI) has raised £835,000 at 5.5p a share, which is below the 7p a share that a UK institutional investor paid last month. Early Equity (EEQP) raised £105,000 at 0.5p a share.
AIM
Trackwise Designs (TWD) is raising a further £11m at 200p in order to finance a new Improved Harness Technology (IHT) manufacturing site to quadruple capacity. That is a large discount to the market price of 320p. A further £1m could be raised via an open offer. Back in March, there was a £5.87m fundraising at 80p a share. That was at the time of the purchase of Stevenage Circuits for up to £2.457m. The rest of that cash was earmarked for capacity expansion. The subsequent orders received by Trackwise mean that further investment in capacity is required. The funding dilutes short-term earnings per share.
Agricultural supplies group Wynnstay (WYN) had a strong end to its financial year, particularly September and October. Feed sales were better than expected. There will be one-off costs for closing three sites. Shore Capital has upgraded its underlying pre-tax profit forecast from £6.7m to £8.1m. The dividend is likely to be maintained at 14p a share.
Immunodiagnostic Systems Holdings (IDH) has broken its record and published interim figures at 6.22pm on Friday. Revenues fell by 27% and the company made a bigger loss.
Staffline (STAF) is selling its apprenticeships business to Babington Business College for a nominal fee. The business was losing money in the first half of 2020, although it was a lower loss than the year before. Staffline will concentrate on recruitment and adult skills training.
Bion (BION) is establishing a biogas consortium with three other companies in Malaysia. The plan is to formalise the partnership so that a special purpose vehicle that would be 55%-owned by Bion will own and operate biogas assets of Bion and Green Lagoon Technology. The new venture would be the largest owner of biogas plants in Malaysia. Shareholders will have to approve the deal if it goes ahead. Bion will work with the other two companies to develop waste-to-energy projects.
Trading is ahead of expectations at Somero Enterprises (SOM) and this should enable a significant supplementary dividend for 2020. The concrete levelling equipment supplier is expected to end the year with net cash of $26m.
Dekel Agri-Vision (DKL) has completed the acquisition of the stake in the Cote d’Ivoire cashew nut processing project that takes its shareholding to 52%. October palm oil production was 1,818 metric tonnes and 1,843 metric tonnes was sold. The average price improved to €636/tonne.
Mirada (MIRA) has integrated Disney+ into its Iris platform for Televisa’s izzi pay TV platform in Mexico.
Invinity Energy Systems (IES) has gained a contract to deliver a 0.5MWh vanadium flow battery system to a site in California. This should generate £480,000in 2021. There is also an order for two smaller battery modules.
Three potential bidders are assessing offers for Telit Communications (TCM) and the latest is u-blox, which is considering an all-share offer worth 250p a share. DBAY Advisors and Lantronix are the other potential bidders.
MAIN MARKET
Packaging supplier Macfarlane (MACF) says that trading in the four months to October 2020 is ahead of the same period in 2019. Full year pre-tax profit is expected to be similar to last year at around £14m. It was previously expected to be more than 10% lower. Arden forecasts a total 2020 dividend of 2.4p a share.
Emmerson (EML) has completed the Environmental and Social Impact Assessment for the Khemisset potash project in northern Morocco.
Petra Diamonds (PDL) has an agreement in principle for a restructuring that involves the raising of money from a loan note issue and the remainder of the loan notes will be converted into shares equivalent to 91% of the enlarged share capital.
Thalassa (THAL) has invested £300,000 in foreign exchange and international payments firm Cornerstone FS for a 3.65% stake. This follows a £3m investment in 8% convertible loan notes in payment systems company Tappit Technologies.
Andrew Hore
Andrew Hore – Quoted Micro 7 September 2020
AQUIS STOCK EXCHANGE
Daniel Thwaites (THW) had net debt of £65.4m at the end of March 2020 and this increased to £71.8m at the end of June following the closure of the company’s pubs and hotels. There is £12m of headroom in the current facilities but management is considering increasing the borrowing facilities. The sites were reopened on 4 July or shortly after. There has been steady growth in sales.
Altona Energy (ANR) has signed heads of agreement to acquire up to 75% of the Chambre rare earth project in southern Malawi. There is a backlog of exploration licence applications following recent elections. The trading suspension will end when new funds are raised. A funding will be launched via investment platform www.NRPrivateMarket.com once an exploration licence is granted in Malawi or heads of agreements are signed for another deal.
SulNOx Group (SNOX) has received a requisition from two shareholders (James Redman Jr and Sungold Escrow Nominees Ltd) for a general meeting. They own more than 5% of the company. A date for the general meeting has to be announced within three weeks.
European Lithium (EUR) has appointed Kimon Gkomozias to the board as part of its strategic agreement with EV technology metals project developer Talaxis. He will help European Lithium obtain funding. A placing is planned to raise $2m at 4.5 cents a share.
Cadence Minerals (KDNC) has obtained agreement in principle for the bank creditor settlement relating to the Amapa iron ore project.
EPE Special Opportunities (ESO) has made a £1.9m investment in Atlantic Credit Opportunities Fund (ACOF), a distressed credit fund. EPE’s investment advisor Epic Private Equity intends to acquire a controlling stake in Atlantic Capital Management, which manages ACOF.
Forbes Ventures (FOR) has set up Forbes Ventures Cell 1 Ltd to acquire UK-issued litigation funding loans. The rights to these loans will be assigned to and securitised by Malta-based Forbes Ventures CC1, which is planning to raise money via a bond issue. A Forbes subsidiary will receive a fee of 2% of the funds raised.
World High Life (LIFE) is assessing investment targets in the medicinal cannabis sector. This includes areas such as synthetic cannabinoids.
Trading in the shares of Sativa Group (SATI) has been suspended while Stillcanna awaits the approval of the Canadian Stock Exchange for the takeover of Sativa. The enlarged group plans to gain readmission to the Acquis Stock Exchange as Sativa Wellness Group Inc.
Alfred Henry Corporate Finance has been appointed as Eastinco Mining and Exploration (EM.P) corporate adviser.
Sumner Group Health Ltd (SGRL) has confirmed its withdrawal from the market on 8 September.
AIM
Capital equipment supplier Mpac (MPAC) has continued to secure orders even with the disruption caused by COVID-19. Interim revenues fell by one-fifth to £36.6m, but services revenues continue to grow. Underlying pre-tax profit fell from £4.5m to £2.5m. The order book is worth £45.4m. Net cash was £22.5m at the end of June 2020. Full year pre-tax profit is expected to fall from £7.5m to £5.2m.
CyanConnode (CYAN) was hit by delays to contracts in the 15 months to March 2020, but it appears to have a strong base for the current financial year. The smart meter technology developer is still losing money, but it has shown that it can manage its cash effectively by gaining advance payments on orders. Net cash was £1.2m at the end of March 2020.
Mattress supplier eve Sleep (EVE) says current trading is ahead of expectations and the full year loss is expected to be slightly lower than previously. Net cash of £5m is forecast for the end of 2020.
Cake Box (CBOX) has made a strong start to the new financial year. The franchised retailer of egg-free cakes is even offering a special dividend of 3.2p a share. Equity Development forecasts a rise in earnings per share from 7.8p a share to 9p a share in the year to March 2021.
7Digital (7DIG) has raised £6m at 2.25p a share, having sought a minimum of £5m. The streaming technology developer will be able to take advantage of opportunities in areas such as home fitness and social media.
Musical instruments retailer Gear4Music (G4M) has continued its sales momentum in the new financial year. There will be an interim trading statement on 22 October.
Driver monitoring systems developer Seeing Machines (SEE) has unveiled a new product strategy. This involves a focus on a chip whose performance is optimised by a neural processing unit called Occula. It will be made easier for automotive clients to integrate this technology. There are also plans to licence the Occula technology.
Nostra Tera Oil and Gas (NTOG) is acquiring a 100% working interest in the Caballos Creek oil field in Texas, which has an economic life of between 16 and 32 years. The cost is $425,000 and there should be a two-year payback. There are proved reserves of 92,100 (69,300 net) barrels of oil equivalent. Current production is 30 (22 net of royalties) barrels of oil per day, which increases Nostra Terra’s production by 25%.
Matthew Freud increased his stake in Reach4Entertainment (R4E) to 19.99% before trading on AIM ended.
Omega Diagnostics (ODX) has CE-marked Mologic’s lateral flow antibody test for COVID-19, which picks up infection at an earlier stage than most tests.
Allergy Therapeutics (AGY) has in-licensed the virus-like particle vaccine technology from Saiba and DeepVax for use in solid tumours, atopic dermatitis, asthma and psoriasis. This broadens the scope of the group, but it continues to focus on allergy treatments.
MAIN MARKET
Consumer products supplier Creightons (CRL) increased full year revenues by 9% to £47.8m, while an improved profit margin meant that pre-tax profit increased from £2.87m to £3.55m. A final dividend of 0.5p a share is proposed.
Papillon Holdings (PPHP) has signed heads of agreement to acquire gold assets in Africa. It plans to acquire 100% of Kilmapesa in Kenya and 70% of the Kakamoeka gold project in Congo Brazzaville. They could provide near-term gold production.
Andrew Hore
Andrew Hore – Quoted Micro 25 May 2020
AQUIS STOCK EXCHANGE
Daniel Thwaites (THW) closed its pubs and hotels on 20 May and it will not pay a final dividend for 2019-20. Net debt was £65.4m at the end of March 2020 and there are £16.6m of spare bank facilities. Trading had been strong, and the predominance of freehold properties means that rent payments is not as big a concern as it is for some pub operators.
Housebuilder St Mark Homes (SMAP) had a NAV of 127p a share at the end of 2019. The share price is 87.5p. There is cash of £4.8m and the company intends to pay off its bond, which has a 6% coupon. In 2019, pre-tax profit dipped from £117,000 to £114,000.
KR1 (KR1) has raised $353,000 from the sale of RPL tokens, relating to the Rocket Pool, which is developing a proof-of-stake infrastructure service using Ethereum 2.0. The tokens were acquired for $0.21 each and sold at $1.67 each. The majority of the RPL tokens acquired are still held by KR1 even though there was a buyer for all of them. The takeover of digital asset custodian Volt Ltd has generated a further $244,000.
Rutherford Health (RUTH) has signed a framework agreement that will enable it to provide cancer treatment services to NHS trusts. The deal lasts an initial period of two years.
Altona Energy (ANR) has cancelled its open offer because the minimum amount was not raised. Instead, management is in discussions with three companies that could reverse into Altona. Cash will be required to cover the costs of a reverse takeover.
Trading has resumed in Lombard Capital (LCAP) shares. Lombard’s waste and recycling subsidiary is acquiring land in Preston for £1.08m. Lombard needs to issue more bonds in order to fully fund the purchase. Existing bond holders are swapping £507,000 worth into shares at 25p each and £320,000 has been raised from the exercise of warrants at 10p each. The current share price is 27.5p and it is more than five times the level it was two months ago. The site was previously used for recycling and Lombard will reapply for an environmental licence. It will be used for a waste to energy project and a plastic recovering plant.
Coinsilium Group Ltd (COIN) has been appointed as adviser to Kesholabs, a Kenya-based blockchain technology developer. Kesholabs is developing three applications that could be launched within 12 months.
Clean Invest Africa (CIA) says that CASA is set to resume limited operations after the lockdown in South Africa. CASA will produce test work and production of anthracite samples.
Ananda Developments (ANA) subsidiary DJT plants has met with the MHRA to discuss its plans to grow strains of cannabis. This is part of the licence application to grow medicinal cannabis. There will be further consultation with the UK authorities.
World High Life (LIFE) says that subsidiary Love Hemp has increased capacity for its LH Botanicals business.
IWEP is swapping part of its loan to Eight Capital Partners (ECP) into a 29.8% stake at 0.025p a share. Shares have also been issued to creditors to satisfy money owed.
First Sentinel (FSEN) has invested £270,000 in Stabiltech Biopharma as part of a £6m fundraising. The corporate finance subsidiary is advising the investee company on further fundraisings. The vaccine developer is developing a potential vaccine for COVID-19. Clinical trials should start in June.
Secured Property Developments (SPD) is still seeking property investments. There is £514,000 in the bank and net assets of £470,000.
All Star Minerals (ASMO0 has raised £80,000 at 0.02p a share and a further £170,000 is being sought. Ian Harebottle and Richard Lloyd, who both have mining experience, are joining the board.
NQ Minerals (NQMI) has raised £189,500 in placings at 7p a share and 7.5p a share. NQ has raised £340,000 in the past fortnight.
Shareholders have passed the resolution to consolidate 100 existing Wheelsure Holdings (WHLP) shares into one new share.
Sport Capital Group (SCG) has appointed Peterhouse as joint broker.
Engineering businesses consolidator Vulcan Industries is seeking admittance to the Aquis Stock Exchange. The focus is profitable metal fabrication and precision engineering businesses. First Sentinel is corporate adviser. The expected admission date is 1 June.
AIM
Renalytix AI (RENX) plans to gain a Nasdaq listing. The renal diagnostics company has not decided how much money it wants to raise. Renalytix AI has launched a joint venture to develop and produce COVID-19 antibody test kits.
STM (STM) subsidiary Carey has won a court case brought by a client. Adams v Carey related to a non-advisory SIPP taken out by Adams and an investment that he asked to be put in the SIPP. The investment performed poorly, and Adams claimed for loss of value. This case has been going on for more than two years.
Employee background checks provider ClearStar (CLSU) has launched a COVID-19 testing service that will help employers with back to work planning. That could attract additional clients for ClearStar’s services.
Imaging services provider IXICO (IXI) increased interim revenues from £3.43m to £4.56m and that helped to more than double profit from £215,000 to £475,000. There was cash of £6.66m at the end of March 2020. The order book is strong. It was £15.3m at the end of the interim period and more has been added since then. Data analysis from existing trials is continuing during the lockdown.
Tiziana Life Science (TILS) intends to demerge its genomics-based personalised medicine businesses into a separate quoted vehicle. This will enable the business to raise cash to develop the StemPrintER technology for the prediction of disease recurrence in breast cancer patients.
Tissue products developer Tissue Regenix (TRX) raised £14.6m at a share price of 0.25p. This was much-needed cash because existing funds were about to run out.
A share placing by Open Orphan (ORPH) at 11p a share raised £12m after expenses. This will help to finance services for COVID-19 vaccines and tests, as well as more laboratory facilities.
Digital TV technology provider Mirada (MIRA) has extended the term for its revolving credit facility by 12 months to the end of November 2021. Earlier this month, Mirada launched a lower cost version of its technology. Iris in Swift Mode is a pre-packaged platform.
Eddie Stobart Logistics (ESL) has acquired the Eddie Stobart brand from Stobart Group (STOB), which will have to change its name, for £10m. An annual fee of £3m was payable for the brand. This will be saved from now on. There have been some reductions in activity due to COVID-19, but grocery and e-commerce demand remain strong.
Cash shell Summerway Capital (SWC) has £5.55m in the bank as it continues to seek an acquisition.
MAIN MARKET
Contango Holdings (CGO) has published a prospectus relating to the acquisition of the Lubu coal project. The potential deal was announced more than one year ago. A £1.4m placing at 5p a share in January will finance costs and initial investment in the Lubu project. Readmission is expected on 18 June.
The Takeover Panel Executive has denied Moss Bros (MOSB) bidder Brigadier’s attempt to lapse its offer. Brigadier has asked for the ruling to be reviewed.
Pure Gold Mining Inc (PUR) has secured a $15m investment at $1.52 a share. This will be invested in the Red Lake Mine.
Loans to Shefa Gems (SEFA) totalling £1.25m have been converted at a premium to the market price. The shares issued account for 14.5% of the enlarged share capital.
Andrew Hore
Andrew Hore Quoted Micro 18 November 2019
NEX EXCHANGE
Trading in the shares of Barkby Group (BARK) has been suspended ahead of further information about a proposed reverse takeover. The acquisition of a group of companies referred to as the Dickson controlled entities is expected to cost £30m, predominantly paid in shares. There will also be a share placing to provide working capital for the enlarged group. Charles Dickson would become executive chairman if the deal goes ahead. The businesses include Workshop Coffee, which operates four coffee shops and is a wholesaler of speciality coffee, a commercial property developer. Barkby will also acquire the right to invest in two private companies: Transcend Packaging, which won a contract to supply McDonalds with paper straws, and VivoPlex, which has developed a medical device for fertility monitoring.
Brewer and pubs operator Daniel Thwaites (THW) says fears that interest rates will fall has required a £4m increase in the provision for its interest rate swaps. That is a non-cash item and underlying pre-tax profit increased from £5.6m to £6.2m in the six months to September 2019. That figure also excludes a quadrupling of property disposal profit to £800,000. Interim revenues improved 7% to £53.4m. The new brewery is operating at full capacity, while there was a small increase in like-for-like pub revenues. The contribution from hotels improved. Net debt was reduced by £8.6m to £61.6m compared with 12 months before, although £22.5m has been reclassified as due within one year. The interim dividend is unchanged at 1.1p a share.
NEX and AIM-quoted AFH Financial (AFHP) says it is trading in line with forecasts. The wealth manager will report underlying EBITDA of more than £17m, up from £10.4m, in the year to October 2019. Funds under management were £6bn. The contribution from acquisitions has been earnings enhancing. The total dividend is expected to be 8p a share and this is expected to rise by one-quarter to 10p a share in 2019-20. There was still £11.9m in the bank at the end of October 2019, although there is estimated to be £32.2m of contingent consideration and a £15m convertible loan in the balance sheet. The current focus is on organic growth and there should be enough cash generated, along with the current balance, to pay the deferred consideration over the next two years.
Ashley House (LSE: ASH) has published a trading statement and it is changing its year end from April to October following the disposal of the Morgan Ashley joint venture. In the 12 months to April 2019, revenues fell from £18.5m to £11.9m and a pre-tax profit of £805,000 was turned into a £2.95m loss. There was a loss contributed by joint ventures. Net debt was £1.8m.
Clinical support systems supplier DXS International (DXSP) is considering a move to AIM. This would be part of a potential fundraising to enable further investment in the business. DXS has already announced that it has been awarded a place on the NHS GPIT Futures framework from the beginning of 2020. This replaces the GPSoC2 framework and means that systems and services will be able to be bought centrally rather than with GP funds. The focus will be on the existing core product DXS Point of Care, analytics and reporting service CompleteCare, digital medicines service ExpertCare and condition management platform MyVytalCare. The first is already on sale and the rest will be launched in early 2020. DXS is gaining final approvals for its four solutions to be listed in the NHS catalogue.
AfriAg Global (AFRI) has raised £160,000 at 0.1p a share. This cash will be invested in additional shares in Apollon Formularies, which will take the company’s stake to 2.68%.
Primorus Investments (PRIM) believes that the lack of flotations is providing it with more opportunities. Primorus has received the £275,000 it was owed by Zuuse and still owns 57,205 shares and holds options over one million shares at A$0.50 (26p) each. The latest fundraising by Zuuse is at A$1 a share. There is a potential market to sell the shares even before a flotation.
Rutherford Health (RUTH) shareholder Formation Group has appointed Andrew Bennett as a non-executive director of the proton beam therapy firm.
David Lenigas has been appointed chairman of NQ Minerals (NQMI) and the board is in talks to replace existing debt with lower-cost debt. First Sentinel, which is run by former NQ Minerals director, has been appointed as corporate adviser.
Block Commodities (BLCC) has raised £388,000 from an issue of convertible loan notes and shares. This is less than the company wanted to raise more than six months ago. The share issue raised £133,000 at 0.02p a share, with a warrant exercisable at the same price, and the conversion of the loan notes will also be at the same price. The cash will be used to move into the medicinal cannabis sector. Additional shares are being issued to pay creditors.
EPE Special Opportunities Ltd (ESO) had net assets of 246.47p a share at the end of October 2019.
One hundred shares in Equatorial Mining and Exploration (EM.P) will be consolidated into one new share on 18 November.
Karoo Energy has changed its name to IamFire (FIRE).
Queros Capital Partners (QCP) will leave NEX on 28 November.
AIM
DBAY Advisors does not intend to bid for Eddie Stobart Logistics (ESL) and instead will acquire 51% of the underlying subsidiary that owns the transport operations. The poor financial situation of the business led to the change of strategy and Eddie Stobart Logistics has recommended the deal, which involves the injection of £55m of additional finance through a PIK Facility. This will pay off a £35m loan and provide working capital. The deal requires the extension of other existing debt facilities. The interim results to May 2019 are still being compiled. An operating loss of at least £12m is expected, but the underlying business could make a full year operating profit of up to £2m. There could be a goodwill write-down of £50m. Net debt will be around £200m. Wincanton (WIN) is still considering a rival deal.
ECO Animal Health (EAH) is still suffering the after effects of the African Swine Flu outbreak in China and the US/China trade war hitting imports from the US. First half revenues from China fell by three-fifths. Restocking will take time to flow through in terms of FCO’s results. There will be a sharp fall in full year profit. The interims could also be affected by accounting policy changes.
Advanced surface coatings provider Hardide (HDD) has been selected to coat parts for the new F-35 Lightning II Joint Strike Fighter. This is an important step in building up business in the aerospace sector. The Hardide-A coating will replace HVOF thermal spray coatings. HVOF is one of the most widely used coatings in aerospace and Hardide-A is said to be technically superior. Hardide has also been awarded a patent for a water droplet erosion resistant coating for blades and vanes, including those used on steam and gas turbines for power generation. A field test is planned.
Adamas Finance Asia (ADAM) says that a test production run is planned later this month by 85%-owned Future Metal at its quarry in China. The plan is to restart production by the end of the year. This will help to underpin the Adamas NAV and provide potential upside. At the end of September 2019, NAV was 84p a share, which is more than three times the share price. Future Metal is 45.2% of that NAV and when the quarry is up and running then Adamas could raise cash by selling some of its stake. Cash is required to invest in new opportunities that are being presented to the company. Adamas issued 16.18 million shares at 34.8p each for its equity investment in Infinity TNP.
Safestay (SSTY) has bought the Hotel Auberge in Berlin, which is near to Berlin zoo, and intends to turn it into a 150-bed hostel. The site has an eleven year lease. This is the latest acquisition this year and it takes the total number of hostel sites to 18. The plan is to have 20 hostels by 2020.
MAIN MARKET
PureCircle Ltd (PURE) chief executive Magomet Malsagov has stood aside temporarily pending further investigation of the classification of the stevia sweeteners supplier’s inventory and other transactions. The investigations have identified that inventory was $23m too high. Other transactions could lead to additional valuation changes. There could be write downs of intangibles and inventories. There should not be any increase in net debt, although the figures are still not fully audited. Bank covenants may need to be waived. Finance director Rakesh Sinha had previously resigned, although he remains with the company until the end of January.
Automotive information publisher Haynes Publishing (HYNS) is seeking a buyer. Management believes the company needs to be part of a larger group with greater financial resources.
Andrew Hore
Andrew Hore Quoted Micro 17 June 2019
NEX EXCHANGE
Renewable energy supplier Good Energy (GOOD) says that holding back on operating expenditure has offset the downturn in demand due to warmer weather. Profit will be weighted to the first half. Good is investing in electric vehicle platform Zap-Map.
Brewer Daniel Thwaites (THW) reported a more than halved pre-tax profit from £9.8m to £4.5m. Turnover improved from £92.2m to £96.9m and the profit decline was mainly due to a non-cash swing from gain to loss on swaps and a pension adjustment. Operating profit was flat at £12.9m. The Inns business improved its profit and individual pubs are making a higher profit contribution, but hotels profit declined. The total dividend was maintained at 3.36p a share. Net debt was £69.7m at the end of March 2019, while NAV was £180.7m. The pension liability has fallen from £34.9m to £24.8m.
KR1 (KR1) has sold 70,079 tokens in the Cosmos Network for $361,000. The average cost of the tokens was $0.10 each and they were sold for $5.14 each. KR1 has also generate a further 7,008 tokens from staking activities and these were sold for $6.93 each.
There was a sharp rise in the share price of TechFinancials Inc (TECH) but much of this gain was lost by the end of the week. There does not appear to be a reason for the rise. Full year results should be published this week. There will be an operating loss. There was $1.1m in the bank at the end of May 2019. The company is still waiting for approval from the Seychelles authorities for the €100,000 disposal of MarketFinancials. There will be write-downs of the value of diamond trading blockchain developer CEDEX and MarketFinancials.
EPE Special Opportunities Ltd (ESO) had a NAV of 272.02p a share at the end of May 2019. The company intends to start buying back shares and these purchases could exceed 25% of the average daily volume of ordinary shares.
Shareholders have approved the plan of Oyster Oil and Gas to distribute the shares of its main subsidiary to settle indebtedness and certain creditors. These include Gunsynd (GUN) although the exact shareholding has yet to be announced. Production sharing contracts in Madagascar and Djibouti are owned by the subsidiary. Gunsynd has raised £500,000 at 0.037p a share.
Trading in Via Developments (VIA1) debentures has recommenced following the publication of figures for 18 months to September 2018. The company has net liabilities of £329,000 with long-term debt of £5.68m offset by cash of £91,000. A subsidiary is securing debt and equity for a project that will generate management fees fir Via, but that won’t happen until September.
Clean Invest Africa (CIA) is holding a general meeting on 3 July in order to gain shareholder approval for the acquisition of the 97.5% of Coal Tech and its related business that it does not own for £27.2m in shares at 2.75p each. CoalTech transforms discarded coal into coal pellets.
Lombard Odier sold 1.65 million shares in Chapel Down Group (CDGP) at 75p a share, reducing its stake to 11.5%. Chief executive Frazer Thompson exercised 2.39 million options at 12.5p a share and finance director Richard Woodhouse exercised 200,000 options at 10p a share and all these shares were sold at 75p each.
AIM
Frontier Smart Technologies (FST) has received another bid approach. Previous potential bidder Science Group (SAG) has built up a 28.3% stake in Frontier so it is in a strong position. It says that it does not intend to sell the shares to another bidder and could block any move to cancel the AIM quotation.
Park Group (PARK) increased investment in the business last year and this knocked underlying pre-tax profit progress which was flat at £12.5m, before asset write-downs. The dividend was increased by 5% to 3.2p a share. There was a smaller contribution from Christmas savings, but growth from corporate promotions and incentives offset that. Increasingly, business is card-based. There was £36.9m of the company’s own cash at the end of March 2019. There will be a dip in profit this year due to higher overheads and profit growth should resume in 2020-21. Chief executive Ian O’Doherty has bought 30,000 shares at 69.5p each.
Stanley Gibbons (SGB) has resolved claims against former management at antique dealer Mallett and this will result in a cash inflow of £850,000 over 12 months.
Safestyle (SSTY) has acquired the freehold of a 161 bed hostel in Pisa for €3.25m. This takes the company’s portfolio to 14 hostels, including the Paris site that is under construction.
Last year was about OnTheMarket (OTMP) building up the number of agencies on its property portal and increasing the number of homebuyers looking at the properties advertised. The rival to Rightmove and Zoopla needs to convert these agencies into fee payers and that process has just started. OnTheMarket will continue to be loss-making this year with higher marketing spending likely to offset higher revenues. Cash is expected to fall from £15.7m to £6.6m at the end of January 2019.
NWF (NWF) did better than expected in the year to May 2019. The feeds business was slightly behind the previous year, but new business helped the food warehouse business to significantly improve its performance and fuels did better than expected despite the milder winter, although behind the previous year. The results will be published on 30 July.
Industrial equipment distributor HC Slingsby (SLNG) says that pressure on margin means that operating profit in the four months to April 2019 is lower, even though revenues are slightly higher. Uncertainty over Brexit is affecting levels of demand in the first half of 2019. Net debt was £1.3m at the end of May 2019.
The actuarial deficit on the Molins UK Pension Fund has been cut from £69.9m to £35.2m over a three-year period. Mpac (MPAC) believes the deficit should be eliminated by July 2024. That is based on maintained payments into the scheme.
Filta (FLTA) says that its figures will be more skewed towards the second half. This is partly down to the integration of the Watbio grease management business. There has been growth in the FiltaSeal business and the North American FiltaFry fryer management franchise business.
Avingtrans (AVG) has acquired the Booth Industries specialist door manufacturing business from the administrator of Redhall (RHL) for £1.8m in cash. Booth made a pre-tax profit of £300,000 last year.
MAIN MARKET
Full year results from fasteners supplier Trifast (TRI) were slightly better than expected. Revenues were 6% ahead at £209m, while re-tax profit was a similar percentage higher at £23.5m. The dividend was increased by 10% to 4.25p a share. Trading remains tough.
Aquila Services (AQSG) has acquired education and sports consultancy Oaks Consultancy for up to £1.7m in cash and shares. In the year to March 2019, Oaks made a pre-tax profit of £254,000 on revenues of £909,000.
Bluebird Merchant Ventures Ltd (BMV) is converting $2.89m of loans into 121.5 million shares. Management made most of the loans and chief executive Colin Patterson will end up with 19.1% of Bluebird. Bluebird is debt-free.
Standard list shell Safe Harbour Holdings (SHH) lost £2.3m in 2018 due to overheads and due diligence costs. There is still £26.9m in the bank.
Andrew Hore
