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23 Sep 20

Confirmation of stellar H1

LoopUp has announced a very strong H1 period, in line with the previous trading update and reflecting a number of months of exceptional performance. This is allowing the business to invest in the major identified new opportunity, to provide telephony within Microsoft Teams, where the early signs are extremely positive. We look forward to further detail on the Teams pipeline and sales levels over time.

Companies: LoopUp Group plc

25 Sep 20

Boohoo Group Plc (BOO LN) - Independent Review Complete

Boohoo has released the now complete Independent Review into its UK supply chain in full this morning. Whilst a number of areas for improvement have been identified, there is no suggestion failings were deliberate or intentional and the chances required involve a relatively easily achieved realignment its of governance systems. We believe the Group remains well-positioned to lead the fashion e-commerce market in the future and can successfully implement an agenda for change in UK garment manufacturing.

Companies: boohoo group Plc

23 Sep 20

Strix Group plc (KETL LN) - Accretive acquisition and outlook improving

Strix has announced the strategic acquisition of LAICA a family owned business in Vicenza, Italy for €19.6m in a mixture of cash and shares. It will be earnings accretive in FY21 and is scheduled to complete by the end of FY20, with just Italian government approval outstanding. ZC operating profit estimates are unchanged in FY20 but increase by c. 8% in FY21 to reflect the contribution from the deal, the impact on earnings is smaller due to the issue of shares and higher tax in Italy. Management believe significant synergies, both cost and revenue, will be derived from the deal over the next 2-5 years. The interim results had been well flagged in the comprehensive trading update in late July and today’s statement confirms that profitability remains in line with the guidance of achieving a flat performance yoy in FY20. The interim dividend of 2.6p is in line with last year and in keeping with the commitment to at least meet the 7.7p paid in FY19. Unlike most peers, Strix has maintained guidance as well as its commitment to pay a dividend and today’s acquisition unpins the continuing strategy of diversifying the business into areas offering greater growth.

Companies: Strix Group Plc

28 Sep 20

Interim results – new forecast, new target price

Interim results to 30 June reflected a step-up in research activity post-June fundraise as it seeks to take its first pre|CISION targeted chemotherapy into clinical trials in early 2021. With period-end cash of £54.5m, Avacta has a cash runway into 2023, providing the necessary working capital to deliver a rapid SARS-CoV2 antigen test, take AVA6000 into the clinic, as well as its first Affimer immunotherapy and the next pre|CISION pro-drug into the clinic. Avacta is aiming to have validated its rapid SARS-CoV-2 antigen test in Q4 2020, the exact timing of which is dependent on pilot batch product from BBI Solutions. However, it is increasingly clear that there is a need for mass screening tests to isolate and remove infectious people, with Avacta’s test at the forefront. We have made changes to FY 2020 forecasts, introduce FY 2021 forecasts and a target price of 310p with a range of 211-796p.

Companies: Avacta Group Plc

24 Sep 20

Cenkos: Venture Life Group Plc -- Very strong first half

Venture Life Group has reported on a very strong H1/20A period. Revenues were up 80% with operational leverage delivering c100% growth in gross profit and +350% adjusted EBITDA growth. Performance was supported by the acquisition of PharmaSource, strong sales to China, sales of new brand, DISINPLUS, and the group's ability to maintain production at its Italian manufacturing facility. With this report we have introduced FY21E forecasts, expecting the company to maintain its growth momentum and deliver 10% revenue growth. Venture Life is delivering a strong performance, we maintain our Buy recommendation.

Companies: Venture Life Group Plc

22 Sep 20

Litigation Capital Management - FY20 Results – Scaling up with strong returns

Litigation Capital Management has announced FY20 results with gross profit up 7% to A$21.7m and PBT of A$9.2m, slightly behind expectations albeit the Group had already flagged that delays to 3 cases during the year would result in resolutions in FY21, thereby impacting FY20 results. That said, excellent strategic progress through the year and good news flow as well as increasing scale suggests more value to come. Reiterate buy

Companies: Litigation Capital Management Ltd.

22 Sep 20

Strong results plus transformational acquisitions

Full-year results to 31 May 2020 deliver revenue of £15.0m (+10.3%) and EBITDA of £6.8m (+36.0%) as noted at the acquisition of Quantuma Advisory. We continue to believe a key value driver of owning K3 shares is an investor’s exposure to the positive disruption being wrought by the company’s model, which now has the ability to be applied to synergistic markets across the addressable professional services SME sector as a result of the two recent acquisitions. The already proven restructuring and insolvency practice specifically has the potential to deliver significant upside in the current environment. We reiterate our estimates, noting EPS growth of 63% between 2020A and 2023E. Target price remains 300p, offering 100% upside from the placing price of 150p.

Companies: K3 Capital Group Plc

24 Sep 20

Upgrades after results and strategic deal

Strix has published reassuring interims and announced the acquisition of LAICA, conditional upon approval from the Council of Ministers in Italy. Against a backdrop of global disruption caused by COVID 19, Strix’s H1 performance is in line with expectations. Net sales down 21% YoY, with a much smaller impact on net profits on the back of strong cost management. Encouragingly, FY 20 profit expectations are now underpinned, at around £28.9m PAT. Taking into account the LAICA deal, we provisionally upgrade FY 21 PAT/EPS by 6%. The shares are already up materially YTD, but the Strix growth story remains compelling.

Companies: Strix Group Plc

23 Sep 20

Cenkos: Equals Group Plc -- Revenue growth through the headwinds

To achieve YoY revenue growth over H1/20A despite the challenges of Covid-19 and its impact on the travel sector is testament to Equals' resilience and increasing focus on B2B and International payments services. While weaker gross profit and EBITDA margins have impacted profitability in H1/20, we see potential for an earnings recovery in H2/20 given cost reduction measures currently being undertaken. This should lead Equals to cash breakeven in Q4/20 and FCF positive by early FY21.

Companies: Equals Group Plc

22 Sep 20

Cenkos: 1pm Plc -- Positive signs emerging over recent months

FY20 results reflect a year of trading in-line with earlier expectations, until being significantly interrupted in Q4/20 by the impact of Covid-19. Despite this, 1pm remained profitable throughout, despite accepting forbearance requests and prudently lifting bad debt provisions for the future. Post-period, there has been a noticeable pick-up in trading as the UK economy recovers, which 1pm is currently positioning itself for. A P/TNAV of 0.55x materially undervalues 1pm, hence we remain at “Buy”.

Companies: 1pm Plc

22 Sep 20

Ergomed - Adj EBITDA upgrade despite industry challenges

H120 adjusted EBITDA of £9.1m was the main positive surprise for us in Ergomed’s full interim report released today. We have increased our adjusted EBITDA forecasts to £18.3m (up 8.6%) in 2020 and £20.1m (up 6.8%) in 2021. A strong order book (£151.4m, up 22.0% from the end of 2019) with high visibility into 2021, continued overall business growth and a strong balance sheet should allow Ergomed to successfully navigate the COVID-19 pandemic, invest in organic growth and look for potential strategic acquisitions. Our valuation is upgraded to £409m or 845p/share.

Companies: Ergomed Plc

24 Sep 20

One of most compelling stocks on AIM

Covid has accelerated the digitisation of all things physical. No more so than in the €10 trillion global construction industry, which some experts reckon has 5 years of catching up to do. A non-insignificant task (eg Crossrail & HS2) that could take decades to play out, but equally realise 100s of £bns of cost, time & productivity savings annually. The €8bn BuildTech sector (10%+ CAGR – see below) is at the heart of this transformation. Providing the glue & ‘digital twins’ that bind all the inter-connected ‘property lifecycle’ parts together – eg CAD/CAM (design), project mgt, visualisation, AI, asset maintenance (operate) and BIM (Building Info Modelling).

Companies: Eleco Plc

22 Sep 20

WHI Morning Comment: Judges Scientific (JDG) - Interim Results – Creditable and profitable H1. No changes to FY estimates

Judges Scientific is focused on acquiring and developing companies in the scientific instrument sector. Given the backdrop of H1, and the global nature of Judges' customer base, we see this morning's results as a significant achievement when set against the backdrop of significant COVID related headwinds. Revenue decreased by 6.8% (organic -12%) to £37.4m (H1-19: £40.2m) which, after the sensible management of the cost base, yielded an adjusted pre-tax profit of £6.4m (H1-19 £8.4m), a 22% reduction, and adjusted fully diluted EPS of 82.5p (H1-19: 107.0p). However, reflecting a commitment to its progressive dividend policy, and confidence in the business, the interim DPS is increased by 10% to 16.5p. With respect to H2, COVID related business risks remain, none of which are unique to Judges. However, given the relative strength of H1 (albeit at some expense to the order book), management flag ‘cautious confidence' in achieving full year market expectations. As such, our FY 2020E adjusted PBT and EPS estimates are unchanged this morning.

Companies: Judges Scientific Plc

24 Sep 20

FY 2020 results – positive outlook drives upgrades

Byotrol’s FY 2020 full-year results are inconsequential, given the dramatic and positive impact that the COVID-19 pandemic has had to product sales since the year-end. However, year-end cash was £0.1m above forecast at £1.7m and when combined with positive cashflow since year-end, Byotrol is well-resourced to finance its ongoing operations and steady growth. With the order-book remaining strong (c.£1.1m at 31 August), despite summer lull, and demand likely to persist for some time, given the emerging second wave of coronavirus, we upgrade EBITDA to reflect lower costs and higher licensing income. If, as we suspect, the demand curve has shifted sustainably to the right, this leaves room for further upgrades. Consequently, we raise our target price to 11p, at which level the stock would trade on EV/Sales and EV/EBITDA of 4.1x and 26.9x, respectively. Future revenues and milestones from licensing deals will be largely additive.

Companies: Byotrol Plc

28 Sep 20

Open Orphan* - Major New RSV Challenge Study Contract

Open Orphan has announced a new £4.3m contract to conduct a Respiratory Syncytial Virus (RSV) human viral challenge study. The customer is a top 10 global vaccine company which continues to demonstrate the attractiveness of the hVIVO assets and the Group's increasing ability to attract business from the largest vaccine and pharmaceutical players in the world. Buy.

Companies: Open Orphan Plc

28 Sep 20

Disposal of ArcelorMittal USA

ArcelorMittal is to dispose of its US operations (ex Calvert) to Cleveland-Cliffs through a share and cash deal. The divestiture of AM US makes sense in our view from a strategic point of view. It also further strengthens the group’s balance sheet, the group having reached its deleveraging targets. US$500m will returned to shareholders thourgh a share buy-back.

Companies: ArcelorMittal SA

28 Sep 20

Red Rock Resources raises £1m to 'put rocket fuel into the engine'

28 Sep 20

Various Eateries raises £25m to take on new opportunities in the restaurant sector

28 Sep 20

Shame on Suez’s board and Parisian inbreeding exposed

The Veolia bid for Suez has exposed again the French penchant for boards of the same feather. The irony is Suez’s poison pill relying on a Dutch stichting under the aegis of some of its board members. This is pushing the envelope too far and makes a mockery of shareholders’ fundamental rights.

Companies: Veolia Environnement SA

28 Sep 20

Shame on Suez’ board and Parisian inbreeding exposed

The Veolia bid for Suez has exposed again the French penchant for boards of the same feather. The irony is Suez’ poison pill relying on a Dutch stichting under the aegis of some of its board members. This is pushing the envelope too far and makes a mockery of shareholders’ fundamental rights.

Companies: SUEZ SA

28 Sep 20

Shame on Suez’s board and Parisian inbreeding exposed

Companies: ENGIE SA

28 Sep 20

Allied Minds - BridgeComm’s 5G partnership with Nokia

BridgeComm, Allied Minds’ third largest holding in which it holds a 63% fully diluted stake (81% pre-dilution), has announced a high-speed optical communications partnership with Nokia. The partnership will leverage BridgeComm's expertise in free-space optical technology and Nokia's portfolio of network equipment and services backed by Nokia Bell Labs, the industrial research arm of Nokia, to facilitate faster deployment of 5G networks. BridgeComm is held by Allied Minds at a fully diluted book value of 7.7p per share (10.0p undiluted), based on an enterprise value of US$38m from BridgeComm’s last funding round in September 2018. With portfolio company valuations based on significantly historic last funding rounds, Allied Minds’ shares trade at a c 60% discount to our unchanged estimated fully diluted NAV of 77.9p (90.3p undiluted; both updated for FX). Allied Minds’ interim results are due on 15 October 2020.

Companies: Allied Minds Plc

28 Sep 20

Telix Pharmaceuticals - TLX591-CDx NDA submitted

On 24 September 2020 Telix announced it had submitted its NDA to the FDA for approval of TLX591-CDx, its positron emission tomography (PET) imaging agent targeting prostate-specific membrane antigen (PSMA). The agency has a statutory 12 months to complete its assessment (two to accept the application and 10 to review). TLX591-CDx would be the company’s first approved product and it is in preparations to be ready to launch the product in 2021, which includes establishing distribution and supply-chain relationships.

Companies: Telix Pharmaceuticals Ltd.

28 Sep 20

Ceres Power Holdings delivers 'solid set of results' with over 20% revenue growth

28 Sep 20

ANGLE completes FDA submission for Parsortix system for metastatic breast cancer

28 Sep 20

Buyout: Caesars likely be the sole bidder

Buyout rumours pushed William Hill’s stock price up 43% on 25 September, driven by initial speculation, and later confirmation that the firm had received acquisition proposals involving cash deals from Apollo Management International and Caesars Entertainment. While we believed a price of 300p+ was unlikely, fresh details about Caesars’ bid validate our initial thoughts. Moreover, we believe Caesars will emerge as a successful bidder. Hence, we will raise our target price to converge to the potential deal price of 272p.

Companies: William Hill Plc

28 Sep 20

Ebiquity - Adapting to circumstance and opportunity

Ebiquity is set for a stronger H220, after a difficult H1 (£26.8m revenue; down 24% y-o-y) when some clients paused or cancelled their marketing activity due to COVID-19. Most of the H120 £1.4m operating loss should be recouped by the year-end. FY21 prospects are further lifted by new client wins, partly from Accenture’s withdrawal from media audit. Newly installed CEO Nick Waters (ex Dentsu) is developing his vision for Ebiquity as a data-driven media solutions provider, augmented with consultancy services. This will be expounded at a capital markets day on 10 November.

Companies: Ebiquity Plc

28 Sep 20

SP Angel Healthcare Conditions

ValiRx Plc: VAL201 clinical trial update

Companies: ValiRx Plc

28 Sep 20

Morning report: FTSE flies as HSBC jumps and Trump tax evasion accusation takes the spotlight

28 Sep 20

Outperforming a recovering market

ZOO Digital is one of the companies whose business models have stood it in good stead during the COVID-19 pandemic; its cloud-based platform has proved to be a key attribute over the last six months. Indeed, the changed working practices within the dubbing industry have helped to educate more potential users about the benefits of remote operating and the quality of performance that can be achieved when using the ZOOdubs platform. In our view, ZOO’s Capital Markets Day (CMD) presentations - a recording is available here - achieved a rare combination of being both informative and clear as to those operational benefits and the financial implications (a roadmap to U$100m of revenue) for the Group within an evolving market. We highlight some of the main messages from the speakers – from outside the company in several cases – which covered the market for localisation services, the use and benefits of ZOO’s platform and the technology behind the service.

Companies: ZOO Digital Group Plc