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13 Aug 20

Cenkos: RA International Group Plc -- Significant commerical sector contract win

RA has announced the award of a significant US$60m Integrated Facilities Management (IFM) contract with a large engineering and construction firm in the oil and gas sector in Southern Africa. The contract will run for two years. This maintains the contract award momentum of 2019 and the strong level of operating activity during H2/19 which continued into early 2020 (FY19A order book ended the year at US$141m). The current order book is now US$188m. Despite inevitable Covid-19 interruption, RA has demonstrated its ability to continue to expand its business substantially with this current US$188m order book now representing 2.7x FY19A revenue.

Companies: RA International Group Plc

07 Aug 20

Velocys

2019 has been a transformative year for Velocys, setting the company up for further progress in the current year and beyond. Despite COVID 19 restrictions the company has continued to develop with the current year seeing further funding secured, the delivery of reactors to Red Rock Biofuels and the securing of planning permission at the Altalto sustainable aviation fuel project. The JDA at Altalto has also been strengthened with British Airways and Shell providing a further £1m funding. Demand for sustainable fuel, especially for aviation, and for negative carbon solutions is growing and Velocys is one of the few companies able to deliver here.

Companies: Velocys Plc

06 Aug 20

Cenkos: Duke Royalty Ltd -- Restoring the royalties

Trading in the royalty partner portfolio over Q1/21 shows a material rebound from May, which has been sustained to date, as the portfolio as a whole returns to more normalised trading. Consequently, Duke's cash receipts, while down 20% YoY currently, are set to step up in H2/21 as forbearance measures largely expire and deferred royalties realised. This bodes well for a rebound in earnings and a return to cash paid dividends. A share price down over 55% since Feb 20, standing at p/book of 0.56x H1/20A's NAV p/s thus appears overdone. We await further clarity on the portfolio before reissuing forecasts, thus leave our recommendation U/R.

Companies: Duke Royalty

11 Aug 20

WHI Morning Comment: Solid State (SOLI) - Continues to trade ahead of expectations, pipeline expansion ongoing

Solid State's update on the four months to March 31st shows that the company, a manufacturer of computing, power and communications products, and value added distributor of electronic components, continues to surprise on the upside. With group revenues relatively stable and the quantum of the order intake YoY reduction on the back of the pandemic shrinking during the recent period, we view this in an encouraging light, particularly against the backdrop of “solid” cash generation as evidenced by cash remaining stable at the year end net cash level of £3.2m. The order book, which is reported to have stood at £39.9m at the year end, was only marginally below this four months on, at the July 31st level of £38.3m, a creditable achievement given that post-Covid some shorter timescales have been seen in UK domestic orders. As previously, our forecasts remain under review for the present. However, with a strong balance sheet and meaningful unutilised bank facilities, we continue to view the group as well-placed to win out as the Covid crisis recedes and indeed to be well-positioned to grow by consolidation as well as by resuming organic growth.

Companies: Solid State Plc

13 Aug 20

Congestion Charge Contract Renewed and Expanded

Following on from Capita’s announcement earlier this week, Eckoh announces it has secured a 6-year £4m contract renewal with Capita for the provision of Congestion Charge Services to TfL. Such contracts typically consist of minimum guarantees and volume related elements. Given the far greater reach of the LEZ and ULEZ and their 24/7 operating times, we imagine volume related elements could mean the contract ends up significantly in excess of the £4m mooted today over time. The high repeat revenue element of Eckoh’s UK business has helped it weather lockdown headwinds, with revenues and profit in April/May at comparable levels to the prior year. Today’s announcement is further validation of both repeatability and the ability to upsell in its highly cash generative UK business.

Companies: Eckoh Plc

12 Aug 20

1HJuly21 update - sailing through the darkest hour

Checkit has released another positive update, one that reveals robust trading has continued into Q2 (possibly the business’ most challenging quarter). This thereby provides optimism that growth may rebound sooner than anticipated (FY20 CKT Europe growth: +30%). The update splits out Q1 & Q2: LFL revs +13% in Q1. For Q2 – and as anticipated - progress did moderate: LFL sales c.-11%. Importantly however, this outcome is better than internal expectations and worth noting also: even during Q2, recurring revenue grew – both y/y and sequentially. For H1 as a whole, LFL recurring revs grew an impressive 23% to £2.3m, total sales meanwhile grew +2% to £6.4m. Success in ‘recurring growth‘ can be attributed to CKT UK (acquired 2019) and its strong presence within the healthcare sector. Here the division has benefitted from new installations and the conversion of existing annual calibration and maintenance agreements to all-inclusive subscription contracts. CKT also updates the market on cash – currently £13.4m. Through this reflects a £0.5m benefit of a repaid loan (so u/l: £12.9m) this still means that YTD cash burn has been modest – evidencing that CKT has responded actively to CV19. We leave forecasts U/R for now and look forward to interims (16/09/20) for a further update on trading. The company continues to fascinate following its landmark BP deal and wider mission: to become a leading provider of cloud-based Connected Workflow Management and Automated Monitoring solutions.

Companies: Checkit Plc

11 Aug 20

Resilient interims to May 2020

Amino has reported reassuring interims in line with the June trading update, confirming 10% revenue growth to $38.0m, including 24% organic growth in software and services, now 26% of group revenue. The July 2019 acquisition of 24i Media accelerated delivery of the January 2019 strategic shift towards software, delivering improved earnings quality from diversification as gross margins from integrated devices hold steady. With 24i moving to a positive contribution of $0.2m (1H19: $-0.2m), the group is positioned well to benefit as visibility of orders and sales pipeline supports FY20 (November y/e) expectations. Management is understandably cautious around the impact of potential COVID delays to customers and the supply chain, but the group remains well supported by a strong balance sheet with net cash of $2.1m, including gross cash of $4.3m and headroom of $13m of undrawn banking facilities. Forecasts are unchanged save for adjustment to FCF expectations to accommodate changes in credit terms, still leaving FY20 net cash of $8m. With the long-term prospects for Amino shining brightly as demand for both platform and content provider solutions is accelerated by COVID, we reiterate our 215p target.

Companies: Amino Technologies Plc

07 Aug 20

Hit in advertising and production

Total advertising revenue dropped by 43% in Q2 20 and ITV Studios was affected by the stop in production. The adjusted EBITA margin collapsed to 14% of revenue (-8pts yoy) despite the reduction in the cost of programmes by £77m and overheads cost savings of £51m over £60m targeted in 2020. There is no guidance for Q3 20 and FY2020. The negative trend in advertising was reduced in July 2020 (-23%). ITV Studios restarted production in June 2020.

Companies: ITV Plc

10 Aug 20

Open Orphan* - Major New RSV Challenge Study Contract

Open Orphan has announced that hVIVO has signed a new contract for an RSV human challenge study clinical trial with a top 3 global pharmaceutical company. The contract shows the Group's ability to convert the existing hVIVO pipeline and engage with the top customers in the industry providing great encouragement for investors in the medium term. Reiterate Buy

Companies: Open Orphan Plc

11 Aug 20

CentralNic Group - Strong growth, but lower Q2 margins

In its trading update, management indicated that it expects H120 revenues in excess of US$110m, with adjusted EBITDA of at least US$15m. Cash increased to US$27.6m at 30 June 2020, while net debt fell marginally to US$76.4m. This would indicate relatively strong Q2 revenues of US$53.6m (Q1: US$56.4m), but a fall in Q2 adjusted EBITDA to US$6.9m (Q1: US$8.1m), meaning lower Q2 margins of 12.9% (Q1: 14.4%). On this basis, revenues would be c 11% ahead of our H120 estimates (US$99.1m), but EBITDA only c 2.7% ahead (US$14.6m) with H120 margins of 13.6% vs our estimate of 14.7%. At this stage, with limited visibility on the performance of the underlying businesses and with no forward guidance, we intend to leave our forecasts unchanged, pending review after the interim results on 1 September 2020.

Companies: CentralNic Group Plc

10 Aug 20

Open Orphan: World-leading expertise drives growth

Open Orphan (LON:ORPH) has rapidly restructured and integrated its Venn and hVIVO subsidiaries, and is delivering on its growth strategy by maximising its specialist capabilities and is converting a pipeline with an estimated value of over £100mln, to deliver long-term, profitable contracts. This w

Companies: Open Orphan Plc

13 Aug 20

WHI Equity Research: i3 Energy (I3E) - Preliminary valuation of Canadian assets

i3 Energy has successfully entered the Western Canadian Sedimentary Basin having secured the acquisition of Gain Energy and Toscana Energy. The company has been transformed into a prolific oil & gas producer – June 2020 production levels were circa 9,500 boe/d. All-in, the assets have been ascribed 2P reserves of 58.5 mm boe. Based largely on the analysis of i3 Energy's competent persons, GLJ and Sproule, we are putting forward a preliminary fair value estimate of 17.7p for the company's Canadian assets.

Companies: i3 Energy Plc

07 Aug 20

SIMEC Atlantis

The investment in feedstock provision for the Uskmouth power station conversion adds an element of de-risking at a crucial time for financing the project in our view. The deal increases feedstock options and allows SIMEC Atlantis exposure to additional profit in a potentially improving waste management market. The proposed c.£6m funding also provides additional resource to the £9.4m cash announced at the end of June, allowing the company to continue to move forward on several fronts.

Companies: SIMEC Atlantis Energy Ltd.

11 Aug 20

Resilience, growth and further potential

We believe Amino’s H1 20A results demonstrate the resilience of the business and the benefits of the ongoing move towards a software-led business model. 24i continues to perform strongly, supported by stable profits (EBITDA) in the Amino segment. Both recorded a number of new contract wins during the period. The group also reported a significant improvement in revenue quality and the business remains underpinned by a solid financial position. We leave underlying forecasts unchanged following the announcement, however with the global COVID-19 pandemic ongoing, uncertainty on the H2 20E outlook clearly remains.

Companies: Amino Technologies Plc

13 Aug 20

Acquisition and accompanying facility to fund more

Acquisition of Berkeley Burke (Financial Services) Ltd and Berkeley Burke Employee Benefit Consultants Ltd for £2.9m maximum consideration (£1.4m initial plus £1.5m deferred and contingent on revenue hurdles). In addition to the acquisitions announced today, the company has received credit committee approval from RBS International for a new £5.5m acquisition facility, further strengthening the potential for STM’s acquisitive growth strategy. The execution of both the due diligence and the deal itself is impressive in the current climate, and the deal adds £0.3m of PBT in 2021E, with a minimum of £0.6m expected from 2022E. We reiterate our 53p price target.

Companies: STM Group Plc

14 Aug 20

HANetf's Bitcoin ETC rapidly becomes most traded product on XETRA

14 Aug 20

Digitization couldn't quite manage it

As we have seen many times in this crisis, a single segment or industry can not offset the weakness of a handful. This was also true for SGL’s Q2. Despite Digitization, customers from all other industries showed resistance to buying to different degrees with various (negative) impacts on sales and profitability. As the company had already released some preliminary figures and had given a FY guidance, the report provided only more details, also regarding the guidance.

Companies: SGL Carbon SE

14 Aug 20

WHI Morning Comment: Caledonia Mining (CMCL) - Q2 (H1) 2020 results - Raised forecasts and new fair value

Caledonia Mining announces Q2 results from its 64%-owned Blanket mine in Zimbabwe today. On the back of management focus and an increased gold price the results continue to improve quarter-by-quarter. Production is up against this time last year to 27.7koz gold for the half year (24.7koz) and on track for managements forecast of between 53-56koz (WHI est. 55.5koz) for the year. Revenues were up in H1 2020 which led to increased Gross Profit at $22.5m (adj. $15m after a one off FX gain) and an improved level of cash at $11.6m ($7.9m); despite a continued $8m investment in the mine expansion ($8.3m). COVID has had little impact on operations at the mine with Caledonia helping Zimbabwe with a $1.1m contribution. Along with its gold producing peers, Caledonia has seen a significant increase in valuation over the course of the year. The increasing gold price has allowed Caledonia to maintain its Central Shaft construction as well as increase the dividend (twice) within the year. We anticipate that the dividend will increase again as Caledonia winds down its capex spend on the Central Shaft and as the increased gold production flows through to the cash flow line. We see fair value in Caledonia at 1,900p after increasing our gold price forecast in line with recent increases. Caledonia remains a solidly run business with an expanding production profile and a potentially exciting in-country source of new projects.

Companies: Caledonia Mining Corp. Plc

14 Aug 20

CASI Pharmaceuticals - Evomela supply secured, CNCT19 on track

CASI reported sales of $2.6m for Evomela in Q220, down slightly from Q1 ($3.4m). The lower revenue was due to logistics disruptions as the company shifted to a new supplier for the drug as well as impacts of COVID-19. Management indicates that the new suppler will substantially improve cost-of-goods. The company is guiding to sales of at least $10m for 2020, but believes that this is a conservative estimate.

Companies: CASI Pharmaceuticals, Inc.

14 Aug 20

SP Angel . Morning View

luejay Mining* (JAY LN) –Final public consultation meeting completed for Dundas project | Condor Gold* (CNR LN) – Interim results and project update | Europa Metals Limited (EUZ LN) – Resource update for Toral zinc, lead, silver project in Spain | Exxaro (EXX J) – Exxaro EBITDA rise 40% due to higher coal exports and lower South African rand | Horizonte Minerals (HZM LN) – Interim Results | Pure Gold (PUR LN) - Q2 Results maintain first-ore production guidance | Serabi Gold* (SRB LN) – Strong quarterly cash-flow as gold price lifts profits 142% | Sibanye-Stillwater (SSW J) - Higher gold, palladium, rhodium and platinum prices combine with weak rand to raise earnings

Companies: JAY CNR EUZ EXX HZM SRB SSW

14 Aug 20

Touchstone Exploration - Drilling underway at Chinook

Solid results from Touchstone, which has spud its latest exploration well on the prolific Ortoire block, Chinook-1. Success would provide another major uplift to the valuation and the growth outlook. Production inevitably took a back seat to this drilling programme, but impressive cost reductions and cash preservation efforts leave Touchstone in a healthy financial position with ~US$15m of available liquidity. Touchstone remains not only an exciting high-impact exploration play but also a strong production and cash flow growth story as it looks to rapidly bring its material low-cost gas/condensate discoveries onshore Trinidad into production.

Companies: Touchstone Exploration, Inc.

14 Aug 20

Bushveld Energy, as part of a consortium of investors, increases investment in Enerox Holdings

14 Aug 20

VolitionRX progressing towards launch of first commercial products using Nu.Q platform

14 Aug 20

Condor Gold looking to commence site preparation and assessing potential routes to early production

14 Aug 20

Strategy suggestion: sell banking business and keep the Aareon business

• Aareal Bank sells a 30% stake in IT subsidiary Aareon to Advent International for €260-310m, which values total Aareon at €860m to €1.03bn compared to a total market cap of Aareal Bank of €1.1bn • No special dividend expected as the capital gain of €180m will be recognised directly in consolidated equity and not affect net income • Aareon’s business seems more attractive for shareholders than old-fashioned banking business

Companies: Aareal Bank AG

14 Aug 20

Target Healthcare REIT - Continuing DPS and positive total returns

Target’s portfolio of high-quality, purpose-built care homes continued to generate positive returns during Q420, driven by RPI-linked rental uplifts, with quarterly dividend payments maintained. The COVID-19 pandemic has presented a significant challenge to tenant operators; however, it does not change the underlying demographic-driven fundamentals that drive the sector and highlights the critical role that it plays in supporting the NHS.

Companies: Target Healthcare Reit

14 Aug 20

H1 20: soft guidance takes centre stage

Novozymes reported largely in line Q2 20 numbers as sales were down 2% (in line with the trading update) and the EBIT margin came in at 25.9% (-10bp vs trading update). The key takeaway was the reinstatement of guidance: FY 20 sales growth of -2% to 2% and EBIT margin of 26%, both of which were below expectations. Following the latest update, we will be lowering our FY20 estimates to factor in the soft guidance, with little target price implications, if any.

Companies: Novozymes A/S

14 Aug 20

Thermo Fisher fails to cross the finishing line

Although Thermo Fisher sweetened the takeover bid by c.10% last month, Qiagen’s shareholders have still rejected the deal – only 47% of the shareholders voted in favour, compared to a minimum threshold of 66.7%. Considering that valuations in the diagnostics space are extremely expensive, higher bids are doubtful. Moreover, Qiagen could prefer to sail independently to cash-in on the unprecedented demand for COVID-19 solutions.

Companies: QIAGEN NV

14 Aug 20

Contract win and validation of SITS:Cloud

Yesterday midday TRB announced a major contract win with the University of Sydney – an existing customer, worth A$10m/5 years, with an option to extend for a further two. Sydney has decided to take SITS:Cloud (the cloud hosted version of SITS, their current Student Information System) to gain a high quality and secure student administration service - essential for an excellent student experience. As well as providing an improved service, this contract also provides a good example of how TRB is enabling universities‘ ‘cloud journeys‘ and furthermore, how TRB can financially benefit as a result. In this example, we estimate the TCV uplift is c.A$6m or £+0.5m pa. This contract provides excellent validation of SITS:Cloud and gives us confidence that other customers may follow (TRB has c.90 university customers). Given the quantum of this financial uplift (2.5x on revs and c.+70% on profit) the extent of SITS:Cloud’s uptake by HE customers is a key consideration, but unfortunately challenging to predict at this early stage. What’s clear though: with FY19 SIS services and maintenance revs and GP of £33m and c.£26m respectively, this opportunity is material. Beyond the financial benefits, SITS:Cloud also commences universities cloud journey and from this, further sales opportunities (e.g. Tribal Edge) should become easier.

Companies: Tribal Group Plc

14 Aug 20

In line H1 2020 results – ensifentrine to be trialled in Covid-19 patients

There were few surprises in today’s H1 2020 results, and Verona has performed financially in line with our expectations. The main news is it has FDA permission to investigate ensifentrine in a study for hospitalised Covid-19 patients that is set to begin in Q3 2020. The study will provide clinical information on ensifentrine in a new disease beyond COPD and cystic fibrosis, and that could be leveraged within the regulatory package for COPD or licensing agreements. We note the recognition of a contingent liability which we have incorporated into our forecasts, but have made no other changes, and believe our forecasts represent up-to-date cost allocation after the raise and today’s interim results. We anticipate the start of the Phase III ENHANCE clinical programme in H2 2020, and nebulized ensifentrine to launch in 2023 with peak sales potential of £760m. Our valuation analysis implies an intrinsic value of 138p.

Companies: Verona Pharma Plc

19 May 17

Leading UK fund manager, Gervais Williams, discusses investing, his outlook and two companies he's excited about

21 Oct 19

Avacta Group PLC boss sees a huge opportunity with new version of cancer treatment

30 Jan 20

Equals Group PLC chief 'phenomenally bullish' about prospects as revenues rise 20%

09 Oct 18

Arena Events Group plc Investor Overview

16 Jul 20

Omega Diagnostics to expand manufacturing capacity as it scales up coronavirus test development

05 Aug 20

FastForward Innovations CEO says granting of licence for Leap Gaming is huge news

06 Feb 20

Morning Report: Touchstone Exploration confirms potential of its Cacadura-1 well

18 Nov 19

CentralNic's acquisition of Team Internet to be 'significantly earnings enhancing'

23 Jan 20

Executive interview - Sureserve

07 Jan 20

Volex PLC Investor Presentatiion

16 Jan 20

Greatland Gold - Outlook for 2020

14 Apr 16

Executive Interview - Martin Aircraft Company

07 Jan 20

Checkit PLC Investor Evening

23 Nov 16

Armadale Capital - Full assay results confirm exceptional high-grade graphite deposit

21 Mar 18