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14 Jan 21

boohoo Group plc (BOO LN) - Strong peak trading

Boohoo has delivered strong results over the peak trading period for the four months ended 31 December 2020. Group revenue is +40% YOY, with robust growth seen across all brands and regions. The Agenda for Change programme is progressing at pace, demonstrating the Group’s commitment to setting a new standard for ethical supply chains in the fashion industry.

Companies: boohoo group Plc

19 Jan 21

EBITDA ahead on strong financial performance

Kape has issued a trading update for what was a very productive year for the Group and in which it exhibited a strong trading performance. Revenue for FY 2020E is expected to be at the top end of the expected range while Adjusted EBITDA is ahead of guidance. We increase our estimates by 1% and 8% respectively to be in line with the anticipated outturn for the year. It now has around 2.5m paying subscribers across its core markets of North America and Europe. Kape also completed the integration of Private Internet Access (PIA) ahead of schedule and launched new products, including its privacy suite. Kape expects to increase R&D spending further in FY 2021E to build on the successful additions to its product range and customer experience. With good momentum going into FY 2021E, the Group continues to demonstrate its ability to drive customer numbers and retention through the execution of a clear strategy for meeting the growing demand from consumers for digital privacy and security solutions.

Companies: Kape Technologies Plc

14 Jan 21

Target Price Increased – 127p

Capital Limited has released its Q4 and FY2020 trading statement this morning. Overall it shows 2020 was a strong year for the company with revenue growing 18% and most other operating metrics growing positively with it – see Fig 1. We have adjusted our forecasts accordingly and also to take into account the mining services contract for the Sukari Mine which the company won late last year. The latter is a game changer for Capital and its investment case in our view; turbo charging revenue growth, enhancing margins and diversifying cashflow all of which should lead to materially higher valuation multiples. We raise our PT to 127p.

Companies: Capital Limited

14 Jan 21

Successful peak trading drives upgrades

We were bullish about the ongoing effects of strategic/operational initiatives at G4M, seeing forecast upside risk. It has not disappointed. Q3 sales and margin outperformance drive a 30% upgrade, and a shift into net cash. Extensive planning and systems/delivery changes have helped it after Brexit too, with trading stronger than expected so far in Jan. Valuation looks undemanding given upgrade momentum and the discount to lower margin peers.

Companies: Gear4music (Holdings) PLC

15 Jan 21

WHI Morning Comment: Jubilee Metals (JLP) - Strong FY first half performance

Jubilee put out an intraday press release yesterday updating on the performance in the first half (ending Dec 2020) of the FY 2021. Once again Jubilee delivers; significantly increased revenues and profits from its chrome and PGM division in South Africa and a small, but important, contribution from Zambia. Notably this improvement isn't just from commodity price performance; rather increased production, productivity, throughput, renegotiated contracts and all set alongside the strong performance of commodity prices –rhodium, palladium and platinum. We see this as still only the start for Jubilee as we look forward to the first copper oxide concentrates from the Roan project in Zambia to the Sable Refinery – where the Roan plant is currently under construction. Once again we are struck by the speed at which Jubilee moves to advance its projects and, with its South African cash engine showing no signs of slowing down. Jubilee can choose to move its wider ambitions in Zambia forward from internally generated cash flow. On the back of the strong performance we put our forecasts under review.

Companies: Jubilee Metals Group PLC

13 Jan 21

Substantial airborne Covid detector opportunity

As a nation, we love knocking ourselves. However in truth, we’re actually a pretty pioneering bunch. For instance, the experts at Oxford University & AstraZeneca have developed one of the world’s 3 most important vaccines in double quick time. Plus, many other British firms are creating similar breakthrough Covid inventions, such as Kromek.

Companies: Kromek Group Plc

15 Jan 21

CCS Support Both Sides of the Pond

2020 ended with two positive moves for carbon capture and storage (CCS) which should benefit Velocys clients. In the US, the signing of the COVID 19 stimulus bill extends and adds support for CCS in the US where the Bayou project is working with CO2 offtaker Occidental to deliver a negative emissions project. The UK government has also published guidance on CCS funding making this option an additional opportunity for the Altalto project. Velocys remains one of the very few opportunities for investors to play negative emission technology. We see both these moves improving the operating environment for the company’s clients and their projects, stimulating demand for the Velocys technology.

Companies: Velocys plc

18 Jan 21

Trading update confirms resilient FY2020

Today’s update confirms a strong recovery in H2 FY2020E as expected and a full year adjusted PBT at least in line with FY2019, despite a material impact from Covid and the depressed oil price resulting in a decline in Augean’s North Sea Services business. The FY2020E outturn demonstrates the resilience of the Group and the strong attractions of its growing EfW activities that now account for c.70% of Group profit. Augean is very well positioned in the EfW residue market and with c.40% of the UK’s hazardous landfill capacity. We forecast Group earnings growth of 15% and 21% for FY2021E and FY2022E, and expect further strong cash generation. EV/EBITDAs for FY2021E and FY2022E are 5.7x and 4.5x respectively, substantially below sector constituents and transaction multiples.

Companies: Augean PLC

20 Jan 21

Surface Transforms - SCE raises funds for future expansion

SCE is raising £20m through a placing and open offer as the future commercial pipeline now justifies building the next manufacturing cell (“Cell 2”). Cell 2 will essentially double production capacity and transform the potential of the business. When operating at full capacity, we estimate that SCE would be capable of £35m revenues, £15m EBIT and £12.5m Earnings. This would equate to EV/EBIT of 7.1x and P/E of 9.5x based on the enlarged capital base. Recent trading updates have highlighted that trading is strong and in line with expectations, while longer term ASP expectations have increased significantly.

Companies: Surface Transforms plc

12 Jan 21

THE MONTHLY January 2021

Although 2020 will probably go down in history as one of the most challenging years experienced during our lifetime, it will also likely be chronicled as one of the best years for the recognition and appreciation of science. As we entered 2020, the COVID-19 pandemic was in its infancy. However, it rapidly evolved through the exponential rise in infections and mortality globally. Much has been achieved during the past 12 months in the fight against COVID-19, but, as we enter 2021, there are considerable concerns about the emergence of a mutant version of the virus and the second wave that we are now facing.

Companies: AVO ARBB ARIX BBGI CLIG DNL FLTA ICGT OCI PCA PIN PHP RECI STX SCE TRX SHED VTA YEW

14 Jan 21

Strong Q3 sales and gross margin growth...

…..drive further forecast upgrade

Companies: Gear4music (Holdings) PLC

18 Jan 21

Augean - H220 momentum from EfW growth to continue

Augean has proven to be resilient throughout the pandemic. In particular, the growth in processing incinerator ash residues from energy from waste (EfW) facilities continues unabated and additional new contract wins should drive improved returns in FY21. Management expects FY20 adjusted PBT to be slightly ahead of last year and we have marginally reduced our FY20 adjusted PBT and EPS estimates by 1%. Our FY21 estimates are maintained. Cash flow has been stronger than we expected, underpinning the indication that dividends should resume in FY21.

Companies: Augean PLC

19 Jan 21

Cenkos: Time Finance plc -- Robust delivery with better times ahead

Time has produced robust interim results, slightly ahead of its earlier trading update, reflecting the gradual recovery of trading from a COVID-19 impacted March to June 2020, which saw a low in the lending book. With own-book origination holding up and arrears/forbearance falling, we view H2/21E positively but note the current UK lockdown presents uncertainty. Still trading at 20% below tangible book value, despite improved macro conditions, we see upside ahead and maintain a “BUY”.

Companies: Time Finance plc

18 Jan 21

Better Q4 than expected + distribution extension

Q4 trading has led sales to guidance being raised 8%. This has been driven by better than expected UK sales, incl. success with new customers like Wilko/Tesco. Some of the benefit is offset by a non-cash FX debit, but it still leads to an upgrade and higher net cash. As a result of successful trials in Tesco Express, W7 is also being rolled out to 469 more stores. This, and previously announced distribution gains, bodes well for incremental sales/PBT in 2021, and underlines the appeal of its value-for-money brands. On 11x 2019 cash-adjusted EV/EBITDA, valuation is undemanding, particularly with the added attraction of dividends/income.

Companies: Warpaint London PLC

19 Jan 21

Leaner, lighter strategy as investment revives

Residential for rent developer and manager Watkin Jones today posted FY 2020 results, in which profits, cash and dividend beat our estimates by c. 4 - 5%. We have maintained our FY 2021E forecasts and introduced estimates for FY 2022E. Our growth assumptions are supported by further evidence in the statement of a revival in forward funding by institutional investors for both the Group’s build-to-rent and student accommodation developments. A new strategy is aimed to trial the private residential sales division more to affordable housing, in line with WJ’s low-risk, capital-light model.

Companies: Watkin Jones Plc

20 Jan 21

JDW issues fresh equity to stay afloat

JDW has raised fresh equity capital (worth £93.7m; equals c.6% of the market cap) as the third national lockdown has dried up operational cash flow. The net proceeds will be used to strengthen further the company’s balance sheet, working capital and acquire any cheaply available properties. Investors have cheered this development as the stock price surged 5% on Wednesday.

Companies: J D Wetherspoon plc

20 Jan 21

MoF open up for more distribution

Support FSA’s call for moderation, but open up for 30% vs 25% proposal For DNB this equals round NOK 7.1 in DPS in Q1, yielding 4.2% Open for more in Q4 pending an individual assessment and consultation Adjust regulation to allow BoD authorisations also for the savings banks

20 Jan 21

Continuing to shine in the East

The group has reported solid Q3 20 trading despite the second wave of lockdowns. All divisions experienced a better-than-expected performance. In particular, jewellery Maisons’ sales jumped 14% yoy, driven by the strong resilience of major brands, namely Cartier and VCA. The increased share in the online channel and expanded exposure to the Chinese market has been the main driver of the group’s business and will continue to boost the group’s top line.

Companies: Compagnie Financiere Richemont SA

20 Jan 21

Revenue growth accelerates in Q3

Experian delivered a strong show in Q3 FY20/21 (7% organic revenue growth), ahead of management’s guidance of 3-5% yoy. The US mortgage activity and consumer services in North and Latin America continued to drive the top line. However, the top-line momentum is expected to ease in Q4, given the tough comparable base. Management has guided the benchmark EBIT to be similar to the previous year’s.

Companies: Experian PLC

20 Jan 21

IoC: The Hermann Maier of SaaS

We initiate coverage of Skitude, the leading SaaS provider for ski resorts. Due to the lack of both digital solutions and penetration in the industry, we see significant growth potential from both the existing resort base of +300 resorts (15% market share), the untapped market and through M&A. Our NOK 14/sh TP implies a 60% discount to our DCF and 5.8x ’22 sales, still leaving a 20% discount to Nordic small cap SaaS peers at 7.6x.

Companies: Skitude Holding AS

20 Jan 21

Strategic turnaround is on track

Although the quarterly sales have been considerably impacted by the second wave of lockdowns and the group’s own decision to reduce markdowns, the high single-digit full-price sales growth and increased contribution in leather and outerwear categories have shown that the group is continuing to progress with its strategic priorities.

Companies: Burberry Group plc

20 Jan 21

FY20 in line, surfing on the wave of online learning

Pearson’s 2020 trading update is in line with a 10% organic sales decline and adjusted operating profit in the range of £310-315m (AV at £309m). Global Online Learning (+30% in Q4) pulled the group due to the wave of distance learning. The pandemic still clouds visibility.

Companies: Pearson PLC

20 Jan 21

Creating Royalties for Value Creation

Empress Royalty Corp. (CVE:EMPR) is the latest mining royalty and streaming company to come to the market, listing on the TSX-V in December 2020.Empress is a precious metal royalty company with a portfolio of 14 royalties. The company is focused on writing royalties and streaming agreements on deve

20 Jan 21

Evolva - New year, new product launch

Evolva is starting FY21 with the launch of a new product, L-arabinose (previously known as EVE-X157/Z4). It is a natural sugar blocker and reducing sugar used in health ingredients and flavours and fragrances. It is fully renewable, sustainable and made by fermentation. The product is already FEMA GRAS-approved for use in food and beverages and has a wide range of applications. Evolva estimates the current market for the product at CHF250m. Commercial discussions with major customers are ongoing and Evolva expects to supply its first volumes in FY21. The launch of this new product shows the breadth of Evolva’s offering and the strength of its pipeline. As a reminder, our model assumes no contribution from L-arabinose.

Companies: Evolva Holding SA

20 Jan 21

Q4 20: exiting 2020 in good shape, ahead of another year of growth

ASML released a sound set of figures for the final quarter of the year, highlighting strong demand for its products and beating the street in every respect. This bodes well for 2021, which is expected to be another year of growth, while we see the current guidance as quite conservative.

Companies: ASML Holding NV

20 Jan 21

2020 restera un grand cru...

Bourrelier Group enregistre une fort bonne surprise au 1er semestre sur l’activité Bricolage au Benelux. Elle pourrait ne pas se limiter au contre coup positif du confinement du T2-2020 et redonne donc des couleurs à cet actif. 2020 sera une bonne année.

Companies: Bourrelier Group SA

20 Jan 21

Sinking Eurostar could trouble Getlink too

Eurostar, the train operator that runs services through the Channel Tunnel, has shrunk from a cheetah to an ailing cat. The company is struggling for survival and is currently negotiating with the British government for a bailout, but the most likely outcome from this negotiation will be a no. Since Eurostar is a major user of the Channel Tunnel, Getlink could see a ripple effect and, hence, we have narrowed down a couple of possible scenarios for Eurostar going forward.

Companies: Getlink SE

20 Jan 21

Powered by technology

Pacific Horizon (PHI) generated a very impressive uplift in its NAV over the course of 2020. This reflects its focus on growth, and technology and biotech stocks in particular. These performed well as we attempted to adjust to life under the pandemic, thereby accelerating a number of structural trends. PHI provided an NAV total return of 86.1%, which eclipsed the return on the MSCI AC Asia Pacific ex Japan of 21.2%, the broader MSCI AC World of 12.7% and the average of its Asia Pacific sector peer group of 25.3%. PHI is the top-performing trust in this sector by a significant margin. Despite this stellar growth, PHI’s manager is not resting on his laurels. Emerging Asia still remains a high-growth and underresearched region, and he continues to focus on those themes he expects to do well over the next five years. For example, EV continues to be a significant theme and the manager has been increasing exposure to the commodities needed to deliver a greener future, but which the world is structurally short of, following long-term underinvestment.

Companies: Pacific Horizon Investment Trust

20 Jan 21

Greatland Gold - Initial Scallywag Results, New Targets Identified

20 Jan 21

Powered by technology

Pacific Horizon (PHI) generated a very impressive uplift in its NAV over the course of 2020. This reflects its focus on growth, and technology and biotechnology stocks in particular. These performed well as we attempted to adjust to life under the pandemic, thereby accelerating a number of structural trends. PHI provided an NAV total return of 86.1%, which eclipsed the return on the MSCI AC Asia Pacific ex Japan index of 21.2%, the broader MSCI AC World of 12.7% and the average of its Asia Pacific sector peer group (see page 23) of 25.3%. PHI is the topperforming trust in this sector by a significant margin. Despite this stellar growth, PHI’s manager is not resting on his laurels. Emerging Asia still remains a high-growth and underresearched region, and he continues to focus on those themes he expects to do well over the next five years. For example, companies exposed to the growth in electric vehicles (EV) continue to be a significant theme. The manager has been increasing exposure to the commodities needed to deliver a greener future, but which the world is structurally short of, following long-term underinvestment.

Companies: Pacific Horizon Investment Trust