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17 Sep 20

Cenkos: Duke Royalty Ltd - Improving trading – increasing cash receipts

FY20A results largely reflect a period prior to the Covid-19 lockdown, yet show Duke entering a more challenging FY21E with momentum. Yesterday's trading update demonstrated another notable rise in quarterly cash receipts for Q2/21, as royalty partner trading continues to improve. As some partners' forbearance measures will expire this month, Q3/21 receipts should continue this upwardly momentum. This opens the door to a return to cash dividends at some future point. Today, Duke also confirms it is now seeking new royalty partners, alongside follow-ons.

Companies: Duke Royalty

15 Sep 20

EUS growth drives record revenue and profit

The Interims are as flagged in the July update; global lockdowns helped End User Spend (EUS) over the platform rise by 59% YoY to £743m. Encouragingly, the H1 revenue growth closely matched that rise; increasing 50% YoY, to a record £4.8m. With operational gearing in the platform, group profitability continues to rise rapidly as revenue grows; H1 adj. EBITDA of £1.1m, more than double the whole of FY 2019 earnings. The major deals delayed in FY 2019 also arrived in H1, for Platform and Bango Marketplace; notably, the purchase of a controlling stake in Audiens by Korean tech giant, NHN, assisting management focus while retaining a 40% stake in a business set to be boosted by funding and IP from its new parent. Operating activities were cash positive and capex was more than covered by an NHN investment, lifting net cash to £4.2m. This is an exciting year, with deals signed in H1 expected to help EUS reach £2bn in 2020 and leaving BGO on track to meet our FY forecasts of strong revenue growth and material profitability.

Companies: Bango Plc

21 Sep 20

Interim results show resilience

Augean has reported interims to 30 June 2020. With the first half bearing the full impact of Covid-19, adjusted PBT decreased by 11% to £8.5m, which is in line with our expectation. With radioactive wastes, biomass for EfW and construction impacted by lockdown and depressed activity levels in its North Sea services, due to the low oil price, the results demonstrate the resilience of the Group and also the benefit of its key position in its markets with strategically located hazardous waste treatment and disposal facilities in the UK. Whilst the statement highlights that full year results are expected to be broadly in-line with market expectations, we have conservatively reduced forecasts. Nevertheless, with strong cash generation and sustained growth EV/EBITDA falls to 5.3x and 4.1x for FY21E and FY22E, a level that is substantially below sector constituents and transaction valuations.

Companies: Augean Plc

16 Sep 20

Interims show strong performance in core business

RBG Holdings had H1 revenues of £12.0m, up 17% against H1’19, of which £11.7m came from the Group’s law firm, RBL. On a LfL basis (excl. £2m of discretionary gains from litigation assets in H1’19), Group revenues were up c.46% YoY. EBITDA of £2.6m offers still-compelling margins of 22%. Transaction delays in Convex and a period of investment in LionFish held back ST performance for these higher margin divisions, yet pipelines remain healthy for Convex. Management is bullish on its ability in H2 to divest litigation assets in order to fund new investment, and in line with strategy. Continued uncertainty over timings around Convex transactions completing, and COVID headwinds, means we keep forecasts withdrawn, however suggest an intrinsic value of 90p is comfortably achievable for the shares.

Companies: RBG Holdings Plc

15 Sep 20

Strong H1 confirmed; strong cash conversion

Kape’s interims saw Group revenues rise +97% y/y to $59.0m (organic: +12%), driven by a 245% increase in Digital Privacy sales (+47% organic). Organic growth was stronger than anticipated in Digital Privacy, above N1Se estimates of 30%-40% as a function of strong end-user demand. CyberGhost (VPN) and Intego (end-point protection) subscriber bases grew +10% and +11% h/h respectively. The main takeaway is Kape’s inflection to positive FCF ($6.7m; H1’19: -$1.8m) alongside increased cash investment into customer acquisition (+60% y/y to $29m). We see meaningful cash flow margins (>25%) being delivered in the next 1-2 years, with £31m of FCF forecast for FY’21E generating a 6.3% FCF yield (peers offer 3.5%-4%). Putting Kape on a 4% FCF yield implies an intrinsic value of >£3/share.

Companies: Kape Technologies Plc

15 Sep 20

Consistent progress, relentless focus 2.4m subscriber base underscores growth potential

Kape has enjoyed a good first half of 2020 both in terms of operational progress and financial performance. Revenues increased 97% to $59.0 million (H1 2019: $29.9 million), a 12% increase on a pro-forma basis. The interim results reflect the Group’s continuing success in integrating its Private Internet Access (PIA) acquisition while growing subscriber numbers – now just shy of 2.4m in total - across the businesses. The focus on customer lifetime value is evident in the marketing spend and investment in new product development. Kape remains on track to meet previous guidance for the full year and expects to deliver synergies from the PIA deal at the top end of the mooted range. We believe that the Group has good revenue visibility and it continues to maintain a high level of user retention at 80%. We make no changes to estimates other than to reflect a higher amortisation charge. In our view, the interim results show that Kape continues to display the drive and capacity to meet the growing needs of consumers for digital privacy and security products in a rapidly evolving marketplace.

Companies: Kape Technologies Plc

21 Sep 20

H1 2020 Interim Results

Central Asia Metals (CAML LN) reported robust interim results in the context of the H1 2020 backdrop; solid production and the company’s fundamentally low cost base meant that CAML remained profitable despite the sharp pullback in commodity prices during the period which led to a 17% YoY decline in revenue to US$70.8m. Consequently, EBITDA was down 25% YoY to US$42.5m despite a decline in unit costs of 6% YoY at Kounrad and 9% YoY at Sasa to US$0.48/lb and US$0.43/lb respectively which cushioned the impact of the weaker the top line. With no significant one offs in the period, EPS of US$0.10/sh. was 33% lower YoY.

Companies: Central Asia Metals Plc

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

18 Sep 20

Cenkos: Trinity Exploration Production P

Trinity has announced a strong set of interim results during a highly volatile period, with production increasing by 9% year-on-year to 3,282bopd (H1/19 3,007bopd). Operating break-even's post hedging in H1/20 reduced to US$22.3/bbl, a 15% year-on-year reduction and a 65% reduction since 2014. Similarly, a relentless drive to improve efficiencies and reduce costs has seen G&A and opex fall by 67% and 65% respectively since 2014. Despite the dramatic fall in oil prices, Trinity's strong production performance combined with its receipt of VAT receivables via a VAT Bond sale and the drawdown of a small working capital facility facilitated cash balances increasing by 43% to US$19.7m from YE2019. Trinity is well positioned to grow both organically and inorganically, with Trinity signing MoU's and submitting EOI's (in consortium with Cairn Energy Plc) to pursue new opportunities of scale. We set our price target a 31p/share, a 248% premium to the current share price and reiterate our BUY recommendation.

Companies: Trinity Exploration & Production Plc

18 Sep 20

Growing long-term subscription revenues

Crimson Tide has reported a strong set of H1 results evidencing very strong sales momentum backed by long-term contracts and cash flow. H1 sales grew by 40% and EPS by 154%. Net cash has improved to £0.8m at June 2020 from nil at December 2019. The strategic focus on transportation and supermarkets is working well, partnerships are improving routes to market, and there is growing traction from investments in innovation. We have left our forecasts unchanged for now, but recognise positive pressure and have upgraded our target price from 3.1p to 4.3p. We reiterate our view that Crimson Tide’s valuation will be dictated by its ability to convert the significant opportunity rather than short-term metrics. H1 results show the group is nicely on track to do exactly that.

Companies: Crimson Tide Plc

22 Sep 20

Cenkos: Rosslyn Data Technologies Plc -- Positive EBITDA

Positive EBITDA in FY20A was a major milestone. Investment across the business is up and there is a clear strategy in place to deliver value for shareholders. The balance sheet is strong post the placing and the business is now self-sustaining. In light of this Rosslyn trades on an unwarranted discount to the software sector.

Companies: Rosslyn Data Technologies 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

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

15 Sep 20

Reassuring trading update

Avingtrans has issued a brief trading update and confirmed that the Group’s preliminary results to 31st May 2020 will be published on 30th September. The trading update is reassuring, highlighting a Q1FY2021E order in-take in-line with management expectations. The statement also highlights two further contract wins in the nuclear sector for US$2.8m in South Korea to provide spare parts for essential water service pumps and a £1.5m UK contract for replacement valves. The previous update in early July has already confirmed that the Group expects to report revenue of £114m, EBITDA of at least £11.5m and net debt (excluding IFRS16 lease liabilities) of £7.5m, which is incorporated into our FY2020E forecasts. It would seem likely that the Group will wish to re-instate forward guidance at the time of the results and to this end we would expect management to indicate a year of solid progress in EBITDA for FY2021E. Over the first quarter the Group has demonstrated good resilience, operating at close to normal levels, with the exception of Oil & Gas (where there is fairly limited exposure) and HVAC activities at Ormandy, supported by exposure to multiple markets and a strong customer base that includes governments and their agents.

Companies: Avingtrans Plc

15 Sep 20

First strategic revamp

With the sale of the Singaporean operations for £1.6bn, the new CEO, Amanda Blanc, shows her intention to focus rapidly on its preferred markets (the UK, Ireland and Canada). The next candidate for sale is the French unit. This transaction is more complicated than the previous one, with the necessity to obtain the agreement of Afer, its key partner in France. With potential proceeds of £2.9bn, Aviva could reduce its debts significantly and allocate more capital to the UK bulk annuity business.

Companies: Aviva Plc

22 Sep 20

Kavango Metals 'gearing up' after announcing Botswana joint venture with Power Metal Resources

22 Sep 20

WANdisco - Launch of LiveData Migrator on AWS and interims

The launch of LiveData Migrator with AWS represents another big step forward for WANdisco. Aside from diversifying the sales base, it suggests that the company’s technology is becoming the established way to migrate large, active datasets to the cloud. Disappointing H1 financials and a delay in the ramp of Azure revenue from Q3 to Q4 leads us to cut our FY20 forecasts. However, Q4 should see a big uplift in financial performance and our newly introduced FY21 forecasts see sales rising to $37m.

Companies: WANdisco 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

22 Sep 20

Rock Resources Australasia reveals results of BMV gold project ahead of '2021 TSX listing'

22 Sep 20

Union Jack Oil# - West Newton B-1 drilling update

West Newton B-1 drilling update

Companies: Union Jack Oil Plc

22 Sep 20

Power Metal takes big step towards listing Australian gold JV after publishing NI43-101 report

22 Sep 20

Innovating in open banking

CREALOGIX is a leading, global, digital banking engagement platform provider. In FY20, revenues grew 1.7% to CHF103.7m, with adjusted EBITDA rising to CHF2.4m, slightly below our expectations. Revenues grew 13.2% in H220 vs H120, with minimal impact from the COVID-19 pandemic. Recurring revenues continued to rise to 44%, with SaaS 17% of the mix, while international sales fell to 62%. Management announced a reorganisation (with a CHF7m provision) to accelerate the SaaS transition, funded by the CHF25m convertible H120 bond refinancing. The SaaS transition will be a drag in FY21 (although we expect stronger margins in H221), before a full year of benefit in FY22. We have lowered our forecasts slightly to reflect a more uncertain global economic outlook.

Companies: CREALOGIX Holding AG

22 Sep 20

SP Angel . Morning View

Bluejay Mining* (JAY LN) – Completion of Thunderstone field exploration program | KEFI Gold and Copper (KEFI LN) – Hawiah PEA delivers $96m NPV with significant upside potential from MRE expansion | Oriole Resources (ORR LN) Preparing for a resumption of drilling in Senegal and Cameroon | Shanta Gold (SHG LN) – NLGM plant capacity to increase by 14%

Companies: JAY KEFI ORR SHG

22 Sep 20

Oil & Gas Daily Flow

President Energy (PPC LN): Low cost production growth achieved | Mosman Oil & Gas* (MSMN LN): Operations at Falcon-1 and Stanley-4 progress

Companies: President Energy Plc Mosman Oil & Gas Ltd.

22 Sep 20

In the right place at the right time

Timing is everything when it comes to innovation. Too early, and even ground-breaking technology can struggle to gain traction. Too late, and the opportunity might be lost. A tricky balance. However for Rosslyn Data Tech, we think this ‘battle-hardened’, cash-rich (Est Apr’21 net funds of £6.1m) & now profitable SaaS firm is ideally placed to benefit from strong secular demand for its cutting-edge & fully integrated Big Data, AI, spend analytics, SMDM (Supplier Master Data Management) & customs/duty handling applications.

Companies: Rosslyn Data Technologies Plc

22 Sep 20

Market report: FTSE fights back after bruising start to week

22 Sep 20

Price Data Interim results update

Cambridge Cognition reported encouraging interim results to June, with revenues up +39% to £3.0m and the Pre-Tax Loss sharply reduced to £0.4m. The company has made strong progress on its commercialisation strategy this year and, having announced £4.9m of contract wins in H1, a major win for a schizophrenia trial has since increased this to £8.4m. Although CV19 led to some contracted clinical trials being delayed in H1, this has been offset by new contract wins and going forwards we see a structural shift to virtual clinical trials which plays to CamCog's strength in remote clinical testing. We raise our FY20 revenue forecast to £6.3m (was £6.2m), which we view as conservative given the sales contracted for 2H20, though we are mindful of possible delays due to CV19. We continue to model a FY20 loss of -£0.7m, with CamCog moving into profit in Q4. We forecast the group to be profitable for FY21 and believe profits can build materially given the tailwind of 17-20% industry growth. We retain our Buy recommendation and raise our target price to 80p (was 75p).

Companies: Cambridge Cognition Holdings Plc

22 Sep 20

2G Energy - Hydrogen ready

2G Energy’s product portfolio of CHP systems positions it to benefit from the transition from coal and nuclear-powered electricity generation to increasing use of wind and solar sources augmented by natural gas to balance supply and demand. In the longer term, 2G has proven technology to address the potential switch from natural gas to hydrogen. However, there still will be significant demand for 2G’s bio-gas and natural gas powered systems if adoption of hydrogen as an energy storage medium is delayed or derailed.

Companies: 2G Energy AG

22 Sep 20

£1bn PRS fund with EQT, 50% market cap in fees(!)

Sigma Capital (“Sigma”) has partnered with global alternatives manager EQT to deliver and manage a £1bn GDV private-rented sector (“PRS”) housing fund focused on Greater London. EQT will invest £300m equity, complemented by debt (including a Homes England facility), to build 3,000 homes in 5 years. Sigma will generate fee income as development manager, a recurring fee income stream from managing completed assets, as well as participation in returns via a minority co-investment (£16m) and a profit share. We estimate that the fee income alone is worth £45m to Sigma in the first five years: 50% of the current market cap. Crucially, this is a step up in AuM bringing a high quality long-term recurring earnings stream. We will reforecast following interim results (expected tomorrow) to provide full context.

Companies: Sigma Capital Group Plc