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11 Jul 18

LIBERUM: Burford Capital* - Update on Petersen - Justiciable in US Federal Courts

In a statement this morning Burford has announced that the US Second Circuit Court of Appeals affirmed the trial court decision finding the Petersen claims against Argentina and YPF to be justiciable in the United States federal courts. They also announced that due to Eton Park being dissolved they have bought the Eton Park equity stake in the YPF litigation case, however, they have sold part of the stake to leave cash exposure unchanged.

Companies: Burford Capital

10 Jul 18

AIM Market – A game of two halves?

In January, we highlighted the progress that AIM had made in H2 2017. We now review the performance in H1 2018. The latest AIM Statistics published on Friday showed that there are currently 944 companies, with 38 new issues so far in 2018, raising £781m and secondary issues raising a further £2.4bn. However, with 51 companies cancelling their listing there was a net fall in H1 2018 of 13 companies. That said, new listings appear to have accelerated recently. In Share News & Views, we comment on Braemar*, Cohort, Cropper*, GetBusy*, IG Design, Lakehouse* Porvair and Wynnstay Group.

Companies: AOR APC BMS CRPR DMTR ECSC ESC EUSP FDM GETB PCF SNX TCN W7L

17 Jul 18

Cenkos: CloudCall Group Plc - Calling an unchanged market opportunity

The rapid +31% YoY revenue growth delivered in H1E did not include any meaningful contribution from the recently expanded sales headcount. Indeed, this growth rate would have been higher and in line with our forecast of +36% had new hires impacted in a timely manner. While we reduce our forecasts for 2018E in relation to this softness, we continue to expect an exit run rate this year strong enough to support an unchanged 2019E.

Companies: Cloudcall Group

11 Jul 18

LIBERUM: Alpha FX* - Strong H1'18 revenue growth

The H1'18 trading update highlights further strong market share gains for AFX with revenues up c50%. We have increased our revenue forecasts and maintain our profit estimates reflecting a number of investments which will position the company to scale significantly over the next few years.

Companies: Alpha Fx Group

11 Jul 18

Totally plc - Great Progress, Great Prospects

Having completed the transformational Vocare acquisition and added to its already well experienced management team, Totally is now tasked with grasping a very significant opportunity within UK healthcare. The NHS' direction of travel has been to address the impact of non-acute presentation at its hospitals. Totally is committed to building a business which provides this triage and a range of support services including, but not limited to, urgent care. While the company has not yet completed the “buy” component of its “buy and build” strategy, it has made significant strides while retaining a key cash generative quality. Final results, for the 15-month period to March 2018, highlight great progress and prospects. We believe that the share price does not reflect this, offering an equity value only just over the current net cash position. It is time for the market to reflect on the prospects for a unique company operating in high growth markets.

Companies: Totally

17 Jul 18

Strong H1’18; rebasing FY’18 on timing

CloudCall’s performance during H1’18 was strong but slightly weaker than our expected run-rate on slower recruitment of personnel to its growing sales team. Our FY18E estimates have been cut on the mismatch between rising costs due to continued investment in growth and the lag to achieve top-line performance, but our price target remains intact. We highlight the impact is localised to FY18E and the group’s product, sales and marketing teams are now in place to support rapid commercialisation. We continue to see substantial upside potential to our PT of 300p, particularly given the shares’ recent weakness, and reiterate our Buy rating.

Companies: Cloudcall Group

17 Jul 18

LIBERUM: Amino Technologies - Initiation - Building next generation TV services

Disruptive commercial and technology challenges facing Amino’s telco and cable operator customers mean they have to reshape and, in some cases, recreate their pay-TV services. This needs investment in new software and cloud models and will require support from specialist solutions providers like Amino.

Companies: Amino Technologies

12 Jul 18

Trading update

We note the trading update released this morning from GYG, confirming that trading has been difficult in the first half of the year and the full year outturn is likely to be materially behind current expectations. We update our forecasts to reflect this new guidance. We now expect EBITDA in 2018E of €4.5m (€9.9m previously) growing to €7.2m in 2019E (€8.2m previously). While this is clearly a disappointing update, the group’s balance sheet remains robust and we believe the industry dynamics remain attractive with the group well positioned to benefit from growth in yacht numbers.

Companies: GYG

17 Jul 18

Delivering TV-as-a-service

Interims for the period to May 2018 delivered EBITDA of $6.8m from $41.2m turnover. Contracted revenue represents 77% (FY17: c75%) of the FY18 target and sales orders 40% ahead of last year, leaving forecasts unchanged. Gross margin of 42.1% (1H17: 44.4%) reflected expected market-wide pressure described at prelims in January; however, cost control reduced opex 3% (vs 1H17), including partial benefit from the completed rationalisation of R&D centres (3 to 2), resulting in annualised savings of $1.4m. Cash generation was typically strong (pre exceptionals), lifting cash to $15m and leading to unchanged FY expectations of $23.5m demonstrating balance sheet strength. Abort fees on M&A deals shows management is strategically active; the dividend is 10% ahead of last year; and momentum is strong, with the order book healthy. Amino continues to demonstrate that it is a software-focused solutions provider delivering TV to customers for clients, anytime, anywhere and on any device. We reiterate our 275p target and look forward to further contract win newsflow.

Companies: Amino Technologies

11 Jul 18

Strong growth in Brands mitigates Manufacturing

The full year update indicates SWL has traded broadly in line with expectations. Owned Brands performed strongly, surpassing expectations via gross margin gains and lower costs. Interest and central costs (share-based payments) were lower too. However, this has been offset by challenges in Manufacturing, namely 1) delays onboarding 3 large new customers (timing issue only) and 2) margin erosion from raw material inflation, the magnitude and speed of which management had underestimated. But for the margin loss, which initiatives are now underway to recover, EPS forecasts would be rising. Instead they edge back 4-5%. The balance of earnings is positive for valuation though, and our fair value estimate increases 3% to 400p.

Companies: Swallowfield

17 Jul 18

Half time scorecard: Q2 to the rescue

With the first half of 2018 behind us, we evaluate the performance of the tech sector versus the broader market, and peers across the pond to see how the London listed technology universe compares to its bigger and better known US counterparts. We examine if the UK listed tech sector is overvalued on a relative basis. No tech sector review can be complete without analysing the performance of the big eight mega tech companies who had a strong H1 period and currently have an aggregate market capitalisation of US$5.18tn, marginally bigger than the Japanese economy.

Companies: APC ECSC EUSP FDM GETB LSAI SNX

09 Jul 18

New strategy under new management

Metminco (MNC) owns the Quinchia Gold Portfolio located in central Colombia within the prolific Middle Cauca Belt. This region is host to numerous largescale projects including AngloGold’s 28Moz La Colosa and Gran Colombia’s 8Moz Marmato gold deposits. With assay results from its nearby Tesorito gold prospect pending, we expect a re-rating of MNC’s stock on the back of results, confirming extensive gold mineralisation. We initiate coverage with a Buy recommendation and a target price of 2p per share (1.5p fully diluted).

Companies: Metminco

10 Jul 18

Investing for the long term

FY 2018 results are in line with the recent trading statement except for a lower tax charge. Sales are up +5.9% at constant currency driven by rapid expansion in Laundry and growth in Kiosks. EBITDA is up a slightly more subdued +2.8% as Japan dragged. As promised, the dividend has been raised by +20% and net cash was £26.7m. Laundry now accounts for 16% of group sales (up from 10%) and is expected to continue to grow in importance. Management has stated that FY 2019E reported PBT is expected to be at least £44m, which is in line with our forecasts. Similarly, this year’s dividend will be held flat. Slightly better cash flow and lower tax, which we assume continues, enables us to raise our target price from 163p to 183p based on a 5% FY 2019E free cash flow yield.

Companies: Photo-Me International

09 Jul 18

Defensive growth investment

H&T Group PLC (LON:HAT) is the UK market leader in pawnbroking, with a chain of 182 high street stores across the county, offering consumers secured credit against items such as gold, watches, and jewellery. In addition to the core pawnbroking activity and related jewellery and watch retailing, H&T Group offers a range of other financial services, detailed in this report.

Companies: H&T Group

10 Jul 18

Cenkos: Totally Plc - Strong progress

Totally has reported results to 31 March 2018, a year in which it made the transformational acquisition of Vocare. Underlying, we believe the 15-month period was largely in-line with our expectations, though are affected by the unusual reporting period and significant exceptional write back. Separately the group has invested heavily in its quality systems and processes which is reflected in the improvement in its CQC ratings. Work remains to be undertaken on integrating Vocare, although we believe the company has made significant progress and is set to win new contracts and assess M&A opportunities. We maintain our Buy recommendation.

Companies: Totally

18 Jul 18

LIBERUM: NewRiver* - Resilient trading and growing development potential

NewRiver continues to deliver positive letting activity alongside high stable occupancy reflecting its convenience offer, low rents, asset management and careful stock selection. In addition to resilient trading, good progress has been made on developments, with the residential potential more than doubled and capable of generating significant profits.

Companies: Newriver Reit

18 Jul 18

LIBERUM: Hotel Chocolat* - Revenues in line: A great result in a tough environment

Hotel Chocolat’s FY18 revenue is in line with our expectations, representing 12% growth YoY. There is no doubt that recent hot weather has been unhelpful, and reflecting H2 store openings and their associated costs, profits are expected to be in line with expectations.

Companies: Hotel Chocolat Group

18 Jul 18

Life sciences and EMEA boost order book; revenue guidance upgraded

Getinge reported mixed Q2 numbers – top-line and order beat, and bottom-line miss. The order book was driven by the life science business and the EMEA region, while sales were driven by life science and APAC. Margin contraction, on the other hand, to a large extent, was a function of a higher sales contribution from emerging markets and capital goods. Given that the order book development was strong but driven again by emerging markets, we expect margin pressure to persist.

Companies: Getinge

18 Jul 18

Promising gold-copper exploration in the Paterson Province

The Paterson Province is emerging as one of the most exciting goldcopper exploration plays in Australia this year. A number of companies, including Greatland Gold (the only AIM-listed explorer in the region), have recently announced gold/copper discoveries. The Great Sandy Desert covers much of the area, and sand cover and the lack of rock outcrops means that the region has been relatively underexplored, notwithstanding the fact that the area contains the huge Telfer gold mine. Drilling at Greatland’s Havieron prospect has yielded extremely encouraging gold and copper intersections, and visible gold has been found in surface samples at Black Hills.

Companies: Greatland Gold

18 Jul 18

Good performance in H1 underpins FY18 outlook

Strix has released a trading update for the six months to the end of June confirming that trading is on course to meet FY18 expectations (ZC forecast FY18 revenue of £96.1m and profit before tax of £29.1m) leading us to leave forecasts unchanged. Global market share has been maintained at c. 38% with the US showing particularly good growth in Regulated Markets. The U9 series is starting to attain good volume with c.20% of specifications going into Less Regulated Markets. In other product segments Aqua Optima has continued the performance seen in FY17 taking UK market share up to 20%, a record level. The shares have rerated recently closing last night at c.169p. This puts the shares on 14.5x current year earnings, assuming a 19% tax rate. The balance sheet is robust with a forecast net debt to EBITDA of sub 1.0x and the shares yield 4.2%, covered almost twice by earnings.

Companies: Strix Group

17 Jul 18

Cenkos: Landore Resources Ltd - Filling

Landore are currently drilling a 12,000m drilling programme aimed at advancing the BAM East Gold deposit to a + one million ounce gold resource and complete a technical and preliminary economic assessment on the project, plus a further 1000m of exploration drilling. Landore has drilled every 100m from 1100E to 1900E in the 900 metre gap between the BAM East Gold Deposit and the original BAM Deposit. So far Landore have drilled from near surface to approximately 125m vertical depth and plan to continue to 250m vertical depth. The drilling has intersected widespread gold mineralisation within a similar lithological package and grade to the two deposits with multiple instances of visible gold and clearly shows the potential to add ounces.

Companies: Landore Resources

17 Jul 18

alfa Systems - 2018 Hackathon London

17 Jul 18

ASA International - Market Open

17 Jul 18

Mosman Oil & Gas Limited - Operational update

17 Jul 18

Cenkos: CloudCall Group Plc - Calling an unchanged market opportunity

Companies: Cloudcall Group

17 Jul 18

LIBERUM: Amino Technologies - Initiation - Building next generation TV services

Companies: Amino Technologies

17 Jul 18

Clubbing and stabbing at the helm continued

After CEO Hiesinger left without giving notice and temporarily replaced by CFO Kerkhoff, Ulrich Lehner, Chairman of the Supervisory Board, has also given up. He had headed the Board since 2013 and he had become a member in 2008. Initially, he had been a representative of the Krupp Foundation.

Companies: ThyssenKrupp

17 Jul 18

Morning Note – 17 July 2018

Amino Technologies (AMO): Corp Delivering TV-as-a-service | Destiny Pharma (DEST): Corp Research collaboration – biofilms | Flowtech Fluidpower (FLO): Corp HY trading update confirms strong H1 growth | Ideagen (IDEA): Corp Low risk in delivering compliance | Independent Oil & Gas (IOG): Corp Thames pipeline integrity update | Iofina (IOF): Corp H1 2018 update

Companies: AMO FLO IDEA IOG IOF DEST

17 Jul 18

Detailed pre-close statement

10% rise in Group Funds under Management to US$5.1bn (£3.9bn), with Emerging Market products contributing 82% and diversification products (i.e. Developed Market, Opportunistic Value and Frontier products) 18%. 10.3% rise in PBT to £12.8m (3.8% below Zeus forecast of £13.3m), with a 22% tax charge 11.0% rise in PAT to £10.1m (0.9% below Zeus forecast of £10.2m). 7.1% rise in fully diluted EPS to 39.3p (2.5% below Zeus forecast of 40.3p) and 8.0% rise in Full Year DPS to 27p (precisely in line with Zeus forecast of 27p).

Companies: City Of London Investment Group

17 Jul 18

Update reveals strong membership growth

Group membership numbers rose by 5.7% to 3,628, from 3,433 at 31 Dec 2017 (8.0% above 3,367 at 30 June 2017). New strategic Partners include Vitality Invest, which is launching in the UK. Group revenues rose 13.7% to £24.2m (1H17: £21.3m; 2H17 £22.8m), with £1.8m due to the acquisition of Landmark Services [and] underlying growth in revenues reflecting the similar growth in membership. Net cash of £1.2m, (net debt of £23.0m at 31 Dec 2017), reflecting operating performance and the beneficial impact of capital raised at IPO.

Companies: Simplybiz