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18 Feb 20

LIBERUM: Sylvania Platinum* - Dislocation from record prices

Sylvania Platinum is trading at extremely cheap levels, just 0.9x adjusted EV/EBITDA on spot. The market clearly feels nervous about the rapid rise in the underlying commodities, palladium and rhodium.

Companies: Sylvania Platinum

19 Feb 20

Kape Technologies

Reiterating the Buy case

Companies: Kape Technologies

13 Feb 20

Y/e trading update – sales ahead, cash in line

Checkit has provided an encouraging year-end trading update to January, disclosing sales of £11.8m, 5% ahead of forecasts, equivalent to +3% LFL growth (group basis), or +8% (ex. EET; non-core). Cash is also reported at £14.3m – ahead of forecasts, but distorted by non-trading activities. After adjusting for both, we believe the underlying cash position is £12.4m – in line with forecasts, in turn implying that CKT’s investment program (and resulting cash burn) is proceeding as anticipated. The update also splits out Checkit Europe’s and Checkit UK’s sales. While such segmental reporting will not be continued, it is reassuring to note that Checkit Plc has acquired a company (now branded ‘Checkit UK’) in good financial health, as it grew pro-forma sales 7% y/y to £11.6m. Checkit Europe meanwhile grew more strongly, at +30% (but off a low base) to £1.3m. Looking forward, y/e pro-forma sales of £14.8m compares against £17.2m expected in FY21E, implying 16% growth. Driving this, we expect Checkit’s landmark contract win with BP (announced Oct-19) to be a material driver. To remind, Checkit won a three year deal to provide its Real Time Operations Management capability to BP at 320 sites. Naturally, we viewed this announcement very positively – as it provided validation of Checkit’s proposition (at an enterprise scale). We look forward to future news flow, confirming the roll-out is going to plan and - potentially - ‘sub contract wins’ also, as the contract may be extended beyond BP’s (320) owned sites, to dealer-owned sites and internationally also. N/c to forecasts.

Companies: Checkit

12 Feb 20

LIBERUM: Plus500* - Q4 stronger than thought

Q4 saw $100m of revenues ex customer P+L. The company will return 100% of 2019 profits to shareholders through dividends and buybacks, has $293m net cash, and may seek targeted acquisitions, new licences and product extensions.

Companies: Plus500

19 Feb 20

LIBERUM: CEO Video: Jaco Prinsloo, Sylvania Platinum*

In these five short videos incoming Sylvania Platinum CEO, Jaco Prinsloo discusses his recent appointment as CEO, the challenges for everyone regarding the power situation in South Africa, dump material life spans and spot prices, the current palladium and rhodium markets and his preferred use of surplus cash. Click below to watch the videos.

Companies: Sylvania Platinum

18 Feb 20

The Industrial Revelation

BHP could revise down estimates if "viral outbreak is not well contained" in Q1 20, HeidelbergCement sees positive demand in 2020, Kone withdraws from Thyssenkrupp bid

Companies: Rotork Somero Enterprises

12 Feb 20

Scapa Group

FY20 trading update – trading profit “significantly below expectations”

Companies: Scapa Group

12 Feb 20

The Industrial Revelation

UK GDP in line with Dec construction beat but manufacturing miss, Japanese machine tool orders fall 36% y/y in Jan, Boeing nets no orders in Jan

Companies: HAYD HILS JHD OXIG RSW RNO SCPA TWD ZTF SOM GHH

17 Feb 20

CloudCall

New CRM partnership with Vincere

Companies: Cloudcall Group

17 Feb 20

WHI Morning Comment: Spectra Systems (SPSY)

Good entry point for great business Only marginally above levels last seen a year ago, we view shares in SPSY at the current price as representing an excellent entry point after coming off on profit taking. This was not, after all, an ordinary year for SPSY but an excellent one, characterised by upgrades, contract wins and most importantly, a significant collection of major opportunities which the company is working through and any of which has the ability to be a game changer for the business. To name a few among many: (1) potential further new work for a G7 central bank (existing client), (2) potential wins from a major Asian central bank, (3) major prospective polymer substrate contract, (4) tobacco smartphone authentication opportunities (TruBrand). As a provider of advanced technology solutions for banknote, product authentication, and secure lottery transactions, SPSY is a highly specialised producer of proprietary equipment, solutions and services, with high entry barriers to match. It is well-invested, hence the enhanced DPS in recent years; and the balance sheet is strong, with $11.1m of net cash (excluding $1.1m of restricted cash) reported with the most recent (H1) results, underpinning future growth expenditure. Importantly, our forecasts only encompass firm business prospects / established contracts. With TruBrand conducting tests in China (see above), this may have affected sentiment, but if so this is misconceived, since (a) this potential future revenue stream is immaterial or non-existent in our forecasts and (b) SPSY is not a one-trick pony – the pipeline is strong with other and major opportunities.

Companies: Spectra Systems

12 Feb 20

LIBERUM: Premier Miton Group* - Net flow stabilisation should be a positive catalyst for the shares

Following a sharp rally in December 2019 many UK listed asset managers have continued to see small share price gains in 2020 with the sector up 4.0% year to date. However, we note that there has been a particular under-performance of Premier Miton’s shares, currently down 17.2% over the same period.

Companies: Premier Miton Group

13 Feb 20

CMD flags strong near-term opportunities

We take the opportunity after last week’s Capital Markets Day to review key themes touched on by management, and the impact on likely future performance. Takeaways impacting organic growth are: 1) The speed at which migrations/ launches occur with Vanilla is faster than previously expected; 2) Video Content and Intent Marketing opportunities open up new streams; and 3) The Group has more potential to generate value from back catalogue content than previously thought. Organic Media sales growth of +3% in our FY’21E forecasts looks too prudent in view of these updates. We therefore upgrade organic Media growth forecasts to +10% y/y, with modest upgrades of +2% and +3% to FY’21E sales and EBITDA. FY’21E FCF yield is 6.8% (Sept y/e); A yield of 4% would generate an intrinsic value per share of >£20.

Companies: Future

13 Feb 20

Premier Oil

Schemes approved by debt holders

Companies: Premier Oil

14 Feb 20

The Industrial Revelation

German GDP stagnates in Q4, BorgWarner expects weak 2020, IPG Photonic cuts Q1 numbers on Coronavirus disruption

Companies: CGS JHD OXIG RSW RNO SCPA TRI ZTF SOM GHH

17 Feb 20

The Industrial Revelation

Japanese Q4 19 GDP sees largest fall since 2014 following recent tax hikes, US industrial production fell due to warm weather and Boeing 737 Max issues

Companies: HTG OXIG RSW RNO SCPA ZTF SOM GHH

19 Feb 20

Q4: margin progressing but not yet at mid-term goal

The good results are clouded by the intention to refinance, with a likely share increase. While this came as a surprise indeed, we acknowledge it is best to address the refinancing of the convertible bonds due next year as soon as possible. Issuing senior notes to replace the convertible bonds is interesting as it would give more flexibility to the group (i.e. less covenants). To do so might require a stronger balance sheet, justifying the share increase.

Companies: FUGRO NV-CVA

19 Feb 20

Allied Minds - Federated moving towards commercialisation

Allied Minds’ portfolio company Federated Wireless has announced new connectivity-as-a-service (CaaS) offerings with Microsoft Azure and Amazon Web Services. This brings to market the first private 4G/5G wireless cloud solution, offered as an end-to-end managed service. These parallel announcements herald a trial period, with initial commercialisation expected towards the end of FY20, but with meaningful revenues expected to build in subsequent years. Having only received FCC approval for initial commercial deployment of CBRS in September 2019, commercialisation has proceeded more quickly than anticipated, underlining Federated Wireless’s first-mover advantage in the US. Allied Minds has also recently completed payment of a special dividend of 12.62p per share (£30.5m in total) to shareholders, from the sale of its stake in HawkEye 360.

Companies: Allied Minds

19 Feb 20

Pixium Vision - Wrapping up 2019 with a solid financial position

Pixium Vision’s 2019 results showed better than anticipated cost containment, as Pixium’s R&D costs were c 20% lower than expected. The company also reaffirmed that it plans to file for a pivotal study (PRIMAVERA) in mid-2020 and start implantations before YE20. We anticipate potential launches in 2023 in Europe and sometime thereafter in the US, and our rNPV increases to €85m, from €78m previously.

Companies: Pixium Vision

19 Feb 20

W Resources chairman at La Parrilla to update on grant funding and new loan

19 Feb 20

EdtechX Holdings to merge with China's Meten Education

19 Feb 20

LIBERUM: CEO Video: Jaco Prinsloo, Sylvania Platinum*

Companies: Sylvania Platinum

19 Feb 20

Will Alstom catch the Canadian train?

Alstom has announced it is to acquire the rail business of the liquidity-crunched Canadian group Bombardier at a bargain price. The €5.8-6.2bn transaction will be c.85% funded by new equity issuance to existing shareholders of the target (CDPQ and Bombardier Inc.) and Alstom (via rights shares). The fate of this deal, which makes Alstom the second largest train-maker globally, is likely to be decided by competition authorities during the first-half of 2021.

Companies: Alstom

19 Feb 20

Currency tailwind resulted in accelerated revenue growth in Q4 19

Puma delivered formidable numbers for 2019. Some of this is supported by the stronger currency tailwind, but the currency-adjusted revenue growth rate also accelerated from +16.7% in 9M19 to +17.0%. On a reported basis, the growth rate accelerated from 17.6% to 20.6%. However, as purchase prices are typically denominated in US dollars, the gross profit margin was up by ‘only’ 0.2pp in Q4 compared to 0.6pp through to September last year.

Companies: Puma AG Rudolf Dassler Sport

19 Feb 20

TNR Gold has ambitions to become a 'leader in green energy metal royalties and gold'

19 Feb 20

Cenkos: Salt Lake Potash Ltd -- Mitsui Offtake

Salt Lake Potash has signed a binding term-sheet with Mitsui & Co for the sale of 4ktpa of premium water soluble Sulphate of Potash (SOP) from its Lake Way Project into Bangladesh, Cambodia, Japan, Malaysia, Philippines, South Korea, Sri Lanka and Taiwan over a period of five years. Salt Lake Potash has now secured offtake for 224kt per annum of the 245kt per annum Lake Way production, with the remaining tonnes expected to be sold into local and spot markets. 4000tpa of offtake is small but Salt Lake Potash had 25ktpa remaining capacity available from Lake Way. However, the product should be high margin as it is being sold into the water-soluble market which generates premiums of up to 20% above standard grade SOP, according to CRU. Discussions around further sales to Mitsui are ongoing.

Companies: Salt Lake Potash

19 Feb 20

Proactive analyst Ryan Long talks tin prices used in economic studies

19 Feb 20

Quadrise Fuels International - Pursuing opportunities in multiple sectors

Over the last two and a half years Quadrise Fuels International has reduced its dependence on individual projects by building up a global network of partner companies, which are identifying and progressing commercial opportunities involving the production and supply of MSAR. Quadrise’s H120 pre-close trading update summarises recent developments in each of the group’s key sectors: utility generation; industrial applications; marine bunker fuel; and as an alternative fuel in upstream heavy oil production operations.

Companies: Quadrise Fuels International

19 Feb 20

Mosman Oil's Andy Carroll hails continued production increase as it narrows focus on Stanley

19 Feb 20

Higher dividend but serious concerns from 2019-nCoV

Ageas reported a FY 19 net income of €979m, up 21% yoy. The Q4 was difficult with a 34% drop in the net result to €102m. Earnings were driven by Life operations (up 65% yoy to €841m). By market, Belgium and Asia contributed up to 96% of the group’s net result. The Solvency II ratio stood at 217.3%, but it does not include the impact of the transaction on Fresh securities (-12%). The proposed dividend exceeded estimates at €2.65/share.

Companies: Ageas