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15 Jan 20

Games Workshop Group - ‘Record sales and profit’ again

Games Workshop’s (GAW) interim results are ahead of expectations. The highest rates of revenue growth were achieved in the channels with the highest operating margins, ie Trade (40% margin) and Online (64% margin). This has produced a strong improvement in free cash flow generation and ROCE has improved from 96% to 111%. We upgrade our forecasts for FY20 and FY21 by a further 3% following the 9% upgrade in November. Our DCF-based valuation increases by 11% to 5,748p.

Companies: Games Workshop Group

14 Jan 20

IQE - Leading innovation from within

The breadth of IQE’s technology portfolio and ability to serve compound semiconductor chip customers in the US and Asia puts it in a good position to benefit from rising demand for compound semiconductor applications for 5G and connected devices. The share price has been hit by the shift to Asian-centric supply chains caused by US-Chinese trade tensions, and resultant reductions to management guidance. Although the timing of a recovery is difficult to gauge, we see scope for earnings recovery as IQE secures additional contracts in Asia and leverages its IP portfolio into sustainable profit growth and cash generation.

Companies: IQE

14 Jan 20

Boku - Payments profits support Identity growth

Boku’s FY19 trading update confirmed that it met consensus expectations for revenue and EBITDA, albeit aided by recognition of one-off revenues of $3.2m in H2. The Payments business showed strong underlying revenue growth driving a 90% increase in adjusted EBITDA while the Identity business made progress in building out supply outside of the US. We continue to consider the Payments business as the engine for profits while we view the Identity business as a longer-term investment in growth.

Companies: Boku

16 Jan 20

CloudCall

FY trading update: In rude health; Buy

Companies: Cloudcall Group

16 Jan 20

LIBERUM: Judges Scientific* - FY19E EPS beat

We increase our FY19E EPS by 4.7% to reflect an encouraging FY trading update from Judges. Our FY20E forecasts remain cautiously set and we think that the risks are to the upside as the year progresses.

Companies: Judges Scientific

15 Jan 20

LIBERUM: Frontier Developments* - Successful PZ launch underpins F/Cs

Frontier has provided a trading update for H1 FY20 which shows revenues up nearly 30% sequentially and confirms the very successful launch of fourth franchise Planet Zoo. Further, Management highlight that all four of Frontier’s game franchises performed well, as expected, over the Christmas period which supports FY forecasts. The next 12 months will see a major paid-for release for Elite Dangerous, the console launch of Planet Coaster as well as a well-planned and increasingly optimised PDLC schedule for JWE and PZ. We retain our Target Price of £18 and our view that Frontier is a core holding in a UK SMID fund.

Companies: Frontier Developments

15 Jan 20

Cenkos: 1pm plc -- Sustainable business in difficult markets

1pm's interim results are robust but slightly weaker than expected with revenues of £15.6m (-2% YoY) and adj EBIT of £3.2m (-21%). Originations growth remained healthy through difficult macro conditions, with the hybrid model allowing 1pm to generate income without taking on unnecessary risk. Consequently, in combination with the costs in running a long-term sustainable business, 1pm is encountering some profit headwinds. We have updated our forecasts accordingly. The shares remain materially undervalued on most metrics.

Companies: 1PM

13 Jan 20

In line trading update

Augean has issued an in-line trading update highlighting strong trading in its final quarter and its expectation that it will report adjusted PBT for the year to December 2019 at least in line with market consensus of £18.4m. We make no adjustment to our forecasts at this time.

Companies: Augean

13 Jan 20

Cenkos: Oil & Gas Update -- Apache Corporation, Pharos Energy, Premier Oil, Rockhopper Exploration, RockRose Energy, Columbus Energy Resources, Cairn Energy, Serinus Energy

West Texas Intermediate (WTI) and Brent crude oil futures edged downward Friday and posted significant declines for the week. WTI for February delivery lost 52 cents Friday to settle at $59.04 per barrel. It traded within a range from $58.85 to $59.78. Compared to 3 January 2020 settlement, the WTI is down 6.4 percent. March Brent shed 39 cents to end the day at $64.98 per barrel. It is down 5.3 percent for the week. Reformulated gasoline (RBOB) finished higher Friday. The. February RBOB contract price settled at $1.66 per gallon, reflecting a nearly one-cent gain. Week-on-week; however, RBOB is down 5.1 percent. Henry Hub natural gas posted a gain for the third straight trading day, with the February contract adding nearly four cents to close at $2.20. Compared to a week ago, gas futures are up 3.3 percent. Rigzone.

Companies: FOG PVR EME TRIN 88E

14 Jan 20

A record Christmas drives upgrades

Boohoo Group has delivered a stellar performance over the key Christmas trading period resulting in a further upgrade to FY20 guidance, its third since 5 th September. Strong growth has been seen across all brands in all key geographical regions. We note the excellent performance seen at the Group’s most mature brand boohoo, where sales in the four months to December are up 42%, an acceleration on the 27% YOY growth posted in Q1 and a continuation of the exceptional 41% growth seen in Q2 of this year. Revised EBITDA margin guidance of 10.0% to 10.2% (previously c.10.0%) is after accounting for investment in three brands acquired in the year and implies strong underlying trading in the Group’s more established brands (boohoo.com PLT and Nasty Gal). The Group continues to deliver an impressive cash performance, with £245m net cash at 31 December.

Companies: Boohoo.Com

14 Jan 20

Consistently high achiever

It’s sometimes easy for investors to get caught up in the latest ‘buzz doing the rounds’, and lose sight of the big picture. Namely finding quality stocks that can out-perform across the economic cycle. Cue Watkin Jones, a developer/manager of large scale, multi occupancy accommodation, who - since IPO’ing at 100p in March 2016 - has delivered a total return of 163% (28.6% IRR):- split 142p capital appreciation and 21p dividends.

Companies: Watkin Jones

15 Jan 20

Q4 2019 Operations Update

Central Asia Metals (CAML LN) announced strong full year production numbers beating our estimates on full year copper and zinc production while lead production was in line with our estimates. Q4 2019 copper production of 3.1kt was down 7% YoY and 22% QoQ following a strong Q3 2019 resulting in full year output of 13.8kt, down 2% YoY with Kounrad now in its new operational phase. Zinc output of 5.7kt was down 2% YoY and 8% QoQ as zinc grades were modestly lower at 3.23% versus a full year average of 3.29% offsetting increased throughput. However, given a strong 9mo19 performance full year zinc output of 22.98kt was up 2% YoY and 2% ahead of our estimate at the top of the guidance range. Q4 2019 lead output of 7.48kt was up 1% YoY and 2% QoQ owing to stronger grades and recoveries resulting in full year output of 29.2kt which was in line with our forecast.

Companies: Central Asia Metals

16 Jan 20

WHI Morning Comment: Judges Scientific (JDG) - Trading update – small upgrades to FY2019E and FY2020E

Judges Scientific, a group involved in the buy and build of scientific instrument businesses, has released a positive FY2019 update this morning. Aided by favourable exchange rates (critical for an export led business), leading to healthy demand, we uplift our FY2019E revenue estimates by 2.1% to £83.2m (from £81.2m), and against a slightly richer margin profile, uplift our adjusted PBT and EPS estimates by 5.0% to £17.3m and 215.5p respectively (from £16.4m and 204.8p). Our FY2019 estimates therefore look for a YoY increase in revenue of 6.9%, and with underlying margins improving, adjusted PBT increasing an impressive 20.8% YoY. FY2020 adjusted PBT and EPS is raised by 3% to £17.4m and 217p (from £16.8m and 210.p).

Companies: Judges Scientific

14 Jan 20

Multi-year Alloy contract win

OMG has today announced a “significant multi-year” Alloy contract win with South Gloucestershire Council, this being the company’s cloud-based asset management solution. A differentiating feature of Alloy is the range (or variety) of assets it can handle, and consequently, Alloy will able to provide a single view from which all relevant public infrastructure can be managed and maintained. No numbers are given, but we remind (as at prelims) OMG had a pipeline consistent with adding £1m of ARR in FY20. We therefore assume that this contract contributes to this figure, and so make no changes to either divisional or group forecasts. Similarly, we note that following FY19 (which saw some delayed ‘go-lives’) it is pleasing to see a major contract win announced relatively early in this financial year.

Companies: Oxford Metrics

10 Jan 20

THE MONTHLY January 2020

The Office for National Statistics (ONS) is due to publish its most up-to-date survey on share ownership in mid-January, which identifies the beneficial owners and decision- makers of the stock market. Hardman & Co has worked together with the share analysis service, Argus Vickers, to jointly produce its own survey, which anticipates the conclusions of the ONS survey but goes into much greater detail. Our work does not use a sample of 200 quoted companies as the ONS historically has, but rather includes everyUK quoted company. The ONS samples share registers every two years; our study uses six-monthly data points. Our survey also extends to shareholders on NEX; the ONS does not.

Companies: AVO AGY ARBB BUR CMH CLIG DNL FLTA GDR MCL NSF PCA PIN PHP RECI RMDL SCE SIXH SHED VTA

19 Jan 20

2019 deliveries down more than expected

Excluding the 2018 CKD deliveries to Iran, PSA’s number fell by 6.6% to 3.49m units. European deliveries fell by 1.1% to 3.03m. Nevertheless, the share of deliveries in Europe increased from 83.2% in 2018 to 86.8%. In spite of this, the group’s European market share fell from 16.0% in 2018 to 15.6%, which is primarily but not exclusively the consequence of Opel/Vauxhall’s lack of attractive car models (its market share fell from 5.7% to 5.2%).

Companies: Peugeot

17 Jan 20

Encouraging rebound in Jewellery

Richemont has released a reassuring Q3 trading update. The trading performance was better than expected in all regions except for Japan. The double-digit sales progression in mainland China and Korea have fully offset the continued decline in Hong Kong. The strong recovery of flagship jewellery brands Cartier and VCA after a disappointing previous quarter has confirmed the attractiveness of the high-end jewellery market.

Companies: Compagnie Financiere Richemont

17 Jan 20

Civitas Social Housing - Strong financial and social returns continuing

H120 results showed strong year-on-year growth in rental income and earnings. Dividend cover is increasing and full cover is in sight, with debt facilities in place to fund further portfolio growth as the company gears its existing equity. Through its investment adviser, the company continues to work closely with housing associations, other counterparties and the regulator to raise performance and delivery standards that will benefit all stakeholders over the longer term.

Companies: Civitas Social Housing

17 Jan 20

Lignite phase-out: a not that accommodating compensation

The German government has provided more details on the timing and level of compensation for the accelerated lignite phase-out: the RWE installed capacity of lignite is expected to decrease from 8,720MW at the end of 2019, to 5,900MW in 2022, 3,800MW in 2029 and 0MW in 2038. The compensation over 15 years will be €2.6bn, while the group estimates the overall financial impact to be around €3.5bn.

Companies: RWE

17 Jan 20

Online leads to a good finish to 2019

GVC reported good Q4 19 numbers, with total NGR up by 1%, on a cc basis. The strong performance was driven by online (+11% with gaming up 9% and sports up 15%) which offset another quarter of decline in UK retail (-11%). Following the strong Q4, management upgraded its EBITDA expectations to the higher end of the earlier range (£670-680m). Given our slightly aggressive estimates, we do not expect any significant revisions to our estimates or target price.

Companies: GVC

17 Jan 20

Revenue guidance from OptiBiotix as it eyes NASDAQ listing

17 Jan 20

Omega Diagnostics - Nigerian approval of VISITECT

Omega announced that the Nigerian Ministry of Health has approved its VISITECT CD4 350 diagnostic test, thereby paving the way for first shipments to its distributor, which has already placed orders for 250k tests with a value of c.£1.0m. Pending confirmation of actual delivery dates, our forecasts assume c.£0.5m is booked in the current financial year, rising to c.£2m in FY 2021 as the expected approval of VISITECT CD4 under the WHO Pre-Qualification programme in 2020 will allow full procurement of the VISITECT CD4 Advanced Disease test by United Nations organisations. We leave our target price unchanged at 25p.

Companies: Omega Diagnostics Group

17 Jan 20

W Resources sells first tungsten concentrate shipment

17 Jan 20

Custodian Reit results show increased fully-covered dividend

17 Jan 20

Auriant Mining - Tardan CIL de-risks Kara-Beldyr

After a few months of delays, Auriant Mining’s Tardan CIL project has now been operating since mid-November. Production guidance for FY19 is 550kg from the Tardan heap leach operation and 150kg from the CIL operation plus c 64.2kg from alluvial operations at Solcocon (total 764.2kg, or 24,570oz). With the CIL plant at full capacity, however, this is expected to increase sharply, to c 29,272oz per year (average) at steady-state, before being supplemented by production of another c 64,041oz per year (average) from Kara-Beldyr from FY24.

Companies: AURIANT MINING

17 Jan 20

An enabling environment (Swissquote Group Holding)

An enabling environment OPINION CHANGE CHANGE IN OPINIONBuy vs Reduce CHANGE IN EPS2019 : CHF 2.91 vs 2.72 +6.96% 2020 : CHF 3.72 vs 3.05 +21.9% Following Swissquote's press release on 15 January regarding its revenues and pre-tax profit, we adjust our numbers for 2019 and going into 2020 and 2021. Revenues were indeed higher than our expectations and management confirmed its ambitious guidance for 2022 at the same time. As financial markets are enjoying a strong momentum, we find it ever more appropriate to increase our expectations and get closer to management's guidance (CHF320m revenues, CHF100m pre-tax profit and CHF36bn assets under custoday expected in 2022). More details are available in a Latest we published on 16 January. CHANGE IN NAVCHF 59.4 vs 52.8 +12.4% Our NAV is based on operating profit per division (securities trading and leveraged FX). As we are increasing our numbers going into 2021 and 2022, our NAV mechanically increases. CHANGE IN DCFCHF 73.2 vs 60.9 +20.2% As we have increased our EPS expectations for the next years, the DCF (which is earnings-dependent) is mechanically increased (all else being equal).

Companies: Swissquote Group Holding

17 Jan 20

As expected, vehicle deliveries fell in 2019

The group’s worldwide deliveries fell by 3.4% or 131k to 3.75m last year. Excluding deliveries of the Chinese joint-ventures, the number also fell by 3.4% or 127k to 3.59m. We had expected a worldwide number of 3.77m, i.e. the discrepancy is only marginal. Excluding the CKDs delivered to Iran in 2018, the rate of decline was 0.8%.

Companies: Renault

17 Jan 20

Focusing on core areas and liquidity

While Benchmark generated good FY19 performance in its Genetics and Animal Health divisions, previously flagged challenging conditions in Advanced Nutrition contributed to the acceleration of a restructuring process. This includes a vigorous review of non-core assets with a view to their disposal or closure, helping ensure the Group’s ongoing financial liquidity. Factoring in disposals and efficiencies, our new forecasts indicate liquidity within its NOK bond-lending covenant terms, supporting our 2020-22 sales CAGR estimate of 12%. Sales will be driven by launches of BMK’s innovative sea lice treatment BMK08, shrimp genetics products and sustained underlying performance.

Companies: Benchmark