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21 Oct 20

SP Angel Healthcare Conditions- Novacyt (NCYT.L): Initiation of Research

Novacyt Initiation of Coverage: Through the rapid commercialisation of a COVID-19 test, Novacyt has transformed its financial position. Demand for the Group's COVID-19 test and other COVID-19 reagents are expected to make up the majority of revenue generated until FY22E, whereupon the Group is looking to drive long-term growth across its business via the development of high-margin clinical diagnostics and establish itself as a leader in infectious disease testing.

Companies: Novacyt SAS

21 Oct 20

Tremor - Strengthening momentum drives FY20 upgrades

Tremor has announced in today’s trading update that its platform has continued to gather further momentum since H1 20 results on 22 September, and it now expects FY20 revenue and EBITDA to be in the range of $340-360m for revenue and $30-36m for EBITDA. This leads us to upgrade our FY20 revenue forecasts by +6% to $350m from $330m, and upgrade our FY20 EBITDA by +32% to $33m from $25m at an incremental margin of 40%. This reflects that Tremor’s platform benefits from strong operational gearing that translates to EFCF, and we increase our FY20 net cash to $79m from $71m. This strengthening momentum for Tremor’s differentiated platform reflects that it is capitalising upon a rebound and shift in advertising spend through the success of the initiatives it launched in 2019 and the successful integration of Unruly, and we explain these factors in more depth from p9 of our 22 September report. Today’s announcement also marks the second upgrade to our Tremor forecasts since COVID-19 impacted the advertising market and Tremor in Q2, and this reflects that Tremor has adopted a prudent approach to its guidance. Applying a similar approach to our estimates, we conservatively do not change our FY21 forecasts, and this means that we continue to forecast FY21 organic revenue growth to $420m or +20% YoY, with organic EBITDA growth to $55m or +67% YoY. This conservative, strong FY21 organic growth means that Tremor looks substantially undervalued on 7x FY20 EV/EBITDA or 5x NTM, and a NTM EFCF yield of 6%; vs peers on 13-19x EV/EBITDA with NTM EBITDA growth of 18-47%, and EFCF yields of 1-2%.

Companies: Tremor International Ltd.

22 Oct 20

SDI Group - Positive trading update drives FY 2021 upgrade

A positive trading update from SDI Group justifies upgrading FY 2021 sales and adjusted EPS forecasts by 10% and 15%, respectively, broadly to the levels we were forecasting before the COVID-19 pandemic struck in early 2020. Contract wins for MPB Industries (flowmeters for ventilators) and Atik Cameras (supplying cameras for PCR DNA amplifiers) are expected to be fulfilled within FY 2021 and consequently we leave FY 2022 forecasts unchanged. We are encouraged by the news that the other businesses within the group are seeing order patterns returning towards normality. We upgrade our target price to 110p, at which level the stock trades on multiples that compare favourably to both the market and peer comparators. Our forecasts exclude the potential for further acquisitions as the company continues to execute on its buy and build strategy.

Companies: SDI Group plc

21 Oct 20

WHI Morning Comment: Spectra Systems (SPSY) - Significant Contract Announcement – Central Bank secured

Spectra Systems Corporation, a leader in machine-readable high speed banknote authentication, brand protection technologies, and gaming security software, has announced that it has executed a comprehensive services contract with a ‘long standing' central bank customer for the development, manufacture and servicing of a sensor system. The initial development phases underpin our FY2021E estimates (with risk likely to the upside), but moreover, the balance of development work, comprising supply of sensors (estimated value up to $34m in 2024-25), servicing revenues ($7.5m) and resultant high margin material sales through to at least 2035, provides significant underpinning of future prospects. Our updated Sum-of-the-Parts valuation (reflecting higher than anticipated development revenues and margins) indicates a risked fair value of 240p (from 200p).

Companies: Spectra Systems Corporation

21 Oct 20

Cenkos: Seeing Machines Ltd -- MOU with L3Harris Technologies

Seeing Machines has announced that it has signed a non-binding Memorandum of Understanding with global aerospace and defence technology company L3Harris Technologies. The MOU frames the intent to enter into a global non-exclusive license agreement to enhance pilot training technology with Seeing Machines's dedicated precision eye-tracking system for flight crew training in the full flight simulator (FFS) environment. A license arrangement is currently in advanced discussions between the parties and subject to the negotiation and execution of definitive, binding licensing and other legal agreements. Further announcements regarding the progress of the negotiations in relation to such binding documentation will be made when appropriate.

Companies: Seeing Machines Limited

22 Oct 20

Impressive H1 sales and gross margin growth..

G4M’s H1 trading update confirms the continued strength of the top line sales growth already disclosed in its Q1 sales update. H1 sales have risen by an impressive 42% to £70.2m, complemented by gross margin expansion of 330bps to 28.5%, reflecting G4M’s focus on profitable sales growth. This translates to gross profit growth of £7.5m (+60%) compared with last year and will deliver interim financial results materially higher than last year. While sales momentum has continued into October, management remains mindful of the ongoing uncertainties around Covid-19 and Brexit heading into the peak trading period. With market estimates already raised on the Q1 update, this prudent caution tempers our full year PBT upgrade to 13%.

Companies: Gear4music (Holdings) PLC

21 Oct 20

Strong Q1, +6% FY21 revenue upgrade

Positive update today, reporting that trading in FYJun21 has begun well. As a result – and also thanks to DOTD’s strong revenue visibility – revenue guidance is already being upgraded. Consequently, we lift FY21E sales by 6% to £53.0m, so now expecting +12% y/y growth. To put this into context, growth fell to +9% in 2H20. We find this rapid recovery to more typical growth levels highly encouraging. Guidance for profit and cash is reiterated, meaning we leave both profit and cash forecasts unchanged. Somewhat obviously, this requires us increasing our cost assumptions….and if these don’t fully materialise, provides upside risk. Cash continues to build, now £27.7m as at Q1 – we might expect this to be strategically deployed, to enhance what is impressively consistent organic growth.

Companies: dotDigital Group plc

20 Oct 20

Open Orphan - £10m COVID-19 challenge contract with UK Govt

ORPH has signed a contract with the UK Government for the development of a COVID-19 human challenge model. This will involve manufacture of the challenge virus and a first-in-human characterisation study. The contract begins immediately and is likely to be worth c.£10m. The government has also reserved the first three slots to test vaccines using the challenge study at a total cost of £7.5m. We revise our forecasts and increase our SOTP target price to 28p (range 25-31p), reflecting ORPH’s world-leading position in traditional challenge models, and now COVID-19 challenge models, with additional upside from the potential development of new challenge models, the monetisation of valuable challenge model data and the potential sale of its non-core pharmaceutical assets.

Companies: Open Orphan Plc

19 Oct 20

Bioventix - FY 2020 results

Bioventix reported a strong set of full-year results, that were 8% above expectations, assisted in part by a c.£0.2m (+3%) FX benefit, which helped offset the obvious drag on performance in Q4 due to the impact of COVID-19 on routine testing in hospitals. A 53p special dividend was proposed, resulting in a full-year dividend of 141p, up 18%. Due to the COVID-19-related disruption to testing, which only exacerbates the poor visibility to customer royalty streams, we are withdrawing forecasts until normality returns. That said, the business remains in very good shape, with evidence that: (i) high sensitivity troponin is gaining momentum; (ii) physical antibody sales growth remains robust (+34%); and (iii) progress in its development pipeline (particularly pollution monitoring programme) is being made. The business is expected to remain cash generative, and with c.£8.1m of cash at 30 June, the company is a strong position to weather this period of disruption before returning to growth.

Companies: Bioventix Plc

20 Oct 20

Open Orphan* - Material UK Government COVID Study Contract

Open Orphan has announced a contract with the UK Government to develop and perform the UK's first COVID-19 (COVID) human challenge studies. The multi-faceted agreement provides strong endorsement and validation of hVIVO's capabilities, with material revenues driving forecast upgrades and further upside risk to earnings as pipeline conversion continues and industry awareness and penetration of challenge studies accelerates.

Companies: OPORF ORPH CRO VENN

27 Oct 20

Revolution Bars Group - Proposed CVA

The group has announced a proposed Company Voluntary Arrangement (“CVA”) in order to reduce the size of its Revolution Bar estate and rental cost base and improve profitability over the longer term. There is no impact on the Revolucion de Cuba brand. The initiative is one of several that management have introduced to counter the impact on trading of COVID-19 and will have the dual benefit of trimming the estate of underperforming sites and delivering a cash flow benefit of c.£2m p.a. The group’s balance sheet remains strong.

Companies: Revolution Bars Group Plc

20 Oct 20

Cenkos: TP Group Plc -- Interim Results

TP Group (TPG) delivered robust organic growth of 13% during H1/20A. However, the impact of COVID-19, together with increased investment and a shift in business mix, meant that Adj EBITDA reduced by £0.9m YoY to £1.4m. TPG has today announced it is in advanced discussions to dispose of its non-core oil and gas focused engineering business. Despite the strong and expanding order book, COVID-19 continues to create uncertainty around the timing of contract deliveries. As such, our forecasts remain withdrawn and our rating Under Review.

Companies: TP Group Plc

21 Oct 20

Hurricane Energy - Forecast and valuation update

Forecast and valuation update

Companies: HUR HUT HRCXF

20 Oct 20

Solid State - Encouraging H1 trading update

The group’s H1 trading update is reassuring, with a strong first half, pointing to a continuation of previously indicated trading patterns. Revenue and profit has been resilient, while cash flow has been strong, returning to normalised patterns having repaid PAYE and VAT and also its final dividend in September. H1 trading benefited from a strong order book heading into the lockdown and due to some delays in order intake over recent months has an order book around 7% less than last year. Management is cautiously optimistic, but still considers that the trading outlook remains uncertain, so guidance remains withdrawn. As such, we look to the December interims to resume forecasts, when order visibility will be clearer.

Companies: Solid State plc

21 Oct 20

Cenkos Securities - Strong activity and lean cost base

Cenkos’s first half results demonstrated the benefits of its flexible operating model and strength of its client relationships. While challenges related to COVID-19 are set to continue, Cenkos’s focus is on growth companies and its fund-raising year-to-date has had a greater emphasis on corporates financing M&A and growth opportunities rather than for defensive purposes. This should prove more sustainable although, as always, the timing of transactions in the encouraging pipeline reported remains uncertain.

Companies: Cenkos Securities plc

27 Oct 20

SP Angel . Morning View

Anglo Asian Mining* (AAZ LN) - BUY – 200p – Vejnaly Contract Area under control of Azerbaijan | Amur Minerals* (AMC LN) – NRR shareholders invest $10m in equity | Bluejay Mining* (JAY LN) – Extension to offtake negotiations for Dundas titanium mineral sands | Condor Gold* (CNR LN) – Detailed geotechnical investigations underway at La India | Directa Plus (DCTA LN) – Directa Plus agrees to supply graphene nanoplatelets to NexTech | Empire Metals* (EEE LN) – Deal offers stake in new Mexican gold mine and cash flow while retaining interest in Georgian assets | IronRidge Resources* (IRR LN) – Final Phase-two drilling results at Zaranou Gold Project | Adriatic Metals* (ADT1) – $28m financing to progress Vareš Silver Project | Kodal Minerals* (KOD LN) – Drawdown of financing | Pure Gold Mining (PUR LN) – Drilling results from Red Lake | Sunrise Resources (SRES LN) – Progress reports on Nevada projects | Vast Resources* (VAST LN) – Mining license extended at Manaila and Carlibaba

Companies: AAZ AMC JAY JAY CNR DCTA EEE IRR ADT1 KOD PUR SRES VAST

27 Oct 20

Ferro-Alloy Resources 'extremely active' after first commercial sale of calcium molybdate

27 Oct 20

The strong Swiss franc burdens an otherwise-decent recovery

Schindler’s 9M 20 revenue contracted by -6.6% yoy, driven by weaker new installations and modernization, while a strong Swiss franc exacerbated the decline. Despite this decline, Schindler experienced a recovery vs H1 20. Net profit fell by 19.4% yoy. Due to Schindler’s cost optimization programme, the company expects to incur up to CHF130m in restructuring costs (including the reduction of c.2k staff over the next two years). On the back of the more optimistic results, FY20 guidance was raised.

Companies: SCHP SHRQ SCHPN SCHP SHLAF 0QO1

27 Oct 20

Fidelity Japan Trust

27 Oct 20

SP Angel Healthcare Conditions

Hemogenyx Pharmaceuticals (HEMO.L): Extension of CDX Development Agreement | Induction Healthcare Group (INCH.L): Rollout of Health Records on iPhone at NHS Trust

Companies: HemoGenyx Pharmaceuticals Plc (HEMO:LON)Induction Healthcare Group Plc (INHC:LON)

27 Oct 20

Upbeat update, tracking in line…

In another upbeat update, GHT has confirmed that the business is tracking in line, in turn being driven by strong traction with key customer, ANZ. Here, new sales have driven a 20% increase in contracted customer revenue to >£11m in FY21. As a strategic partner (deeply involved with GHT in bringing new Clareti banking services to market) this extra investment is very encouraging, as it’s indicative of these services‘ strong future potential. Also announced today – GHT state that its transition to a recurring subscription model (commenced just two years ago) is now complete and that ARR now stands at £11.9m, ~+16% annualised organic growth since FY20 y/e. In a tough new business environment, we view this as a highly credible performance. It’s also worth noting that management reference remaining pipeline opportunities, these would further benefit strong forwards visibility – already £22.4m for FY21. Given this – and also as sign of confidence – today we reinstate FY21 forecasts. We look for a reacceleration in top-line growth: +16% y/y to £28.7m at a Group level, in turn driven by c.+24% organic growth in Clareti, to £20m. For valuation – with Clareti still in its relative infancy – we continue to view a sales multiple as most appropriate. Here, we note that peers typically trade in a 5-7x range vs. GHT at 4x our FY21 estimate. This suggests 25-75% upside to fair value for this disruptive company, with a multi-year growth opportunity still ahead.

Companies: Gresham House

27 Oct 20

FY'20 results inline; updated forecasts post IPO

FY’20 results are slightly ahead of our expectations, and cap an excellent period with strong news flow. KidneyIntelX has now launched at Mount Sinai and is cleared to report results in all 50 US states. We continue to believe KidneyIntelX could represent the future standard-ofcare for early detection of chronic kidney disease progression and kidney failure in patients with Type II Diabetes, affecting an estimated 11m. Focus is now on building out the platform with expanded indicated uses, win national reimbursement and drive testing adoption. One significant catalyst ahead is Medicare coverage, which come as early as H1 2021 under new proposed rules. Whether or not this rule is finalised, the company is moving forward towards broader insurance payor coverage. In this note, we have refreshed our forecasts and valuation reflecting the deployment of IPO proceeds.

Companies: Renalytix AI Plc

27 Oct 20

SP Angel Healthcare Conditions- 27-10-2020

Companies: Induction Healthcare Group Plc (INHC:LON)HemoGenyx Pharmaceuticals Plc (HEMO:LON)

27 Oct 20

Market Report: Flat FTSE as Covid-19 infections rise and fears of Christmas cancellation

27 Oct 20

WHI Equity Research: Various Eateries (VARE) - Taking a bite out of the UK hospitality sector

Various Eateries listed on AIM last month, raising £25m in new growth capital. The business arguably has the strongest ever team assembled in the hospitality sector, one that is now looking to take advantage of the extraordinary conditions created by the COVID-19 pandemic. The Board includes Andy Bassadone (Ivy Collection, Côte, Bill's, My Kinda Town), Hugh Osmond (PizzaExpress, My Kinda Town, Punch Taverns), Yishay Malkov (Ivy Collection, Roka Zuma) and Oli Williams (Itsu, McDonald's), giving it the experience to acquire and successfully convert sites at pace. The group has two brands ideally positioned for the post COVID-19 environment of the 2020s, including the trend for working from home. While some of the group's ten existing locations are likely to continue to see a near-term impact from the Covid response, these measures, are by their nature, structurally increasing the size of the opportunity ahead for Various Eateries - competition for customers being further reduced, more sites becoming available at even lower rents and a larger and more distressed pool of potential acquisition opportunities being presented. As such, we believe the current backdrop has created the greatest opportunity in casual dining since the sector began to emerge in the UK in the 1990s. We see fair value for the shares at 92p.

Companies: Various Eateries Plc

27 Oct 20

Staughton Airfield Solar Farm represents a major milestone for the NextEnergy Solar Fund

27 Oct 20

Hunting - Q3 trading statement

Q3 trading statement

Companies: HNTIF 0YT HTG

27 Oct 20

VSA Morning Miner 27/10/20 (Prime Mining)

Further encouraging results have been announced by Prime Mining (PRYM CN) this time from the Eastern part of the license area at Los Reyes and the Guadalupe East zone of mineralisation highlighting that there is substantial potential beyond the Zapotes area of the license where recent announcements have focused. PRYM has been conducting systematic exploration work around its existing deposits to enable the company to efficiently target drilling to fulfil the three current core objectives; to expand the footprint of known mineralisation, upgrade confidence and target new untested zones. These latest results relate to the former.

Companies: Prime Mining Corp.

27 Oct 20

Solid quarter adds to positive trend

Nordea reported Q3 figures on Friday, and it continues to show signs of improvement. Q3 in isolation delivered a beat on most lines in the P&L and a >10% ROE, and importantly, if we look at rolling 12-month figures, Nordea has now delivered three sequential quarters of both revenue growth and growth in PBLL. With prospects of lower losses as well this is beginning to look like it might be a case again soon. We stick to Hold for now, but raise our TP to SEK 75 (72)

Companies: NDA 0N4T NDA NDA NDAN NBNKF NDB 04Q

27 Oct 20

All it took to restore margins was a pandemic

Q3/20 EBITDA of NOK 413m vs. Factset consensus of NOK 367m Solid Q3/20 gross margin of 40.5%, up from 37.3% in Q3/19 LFL sales growth of 16.1% Y/Y driven by 21.1% LFL growth in Norway We expect share price and estimates to move higher today

Companies: XXL XXLO 2XX XXL