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20 Jan 20

Rapid growth confirmed

Kape have announced a full year trading update confirming the expected strong growth in top-line and adjusted EBITDA. Kape’s sales growth accelerated sequentially to 19% h/h in H2 (H1: 7%), supported by continued growth in the Group’s core Digital Privacy segment. Full year revenues of c.$66m (N1S: $68.9m) were achieved after some reallocation of marketing investment towards Digital Privacy (sales recognised over time), which has in turn led to an improvement in revenue visibility for future periods. Adjusted EBITDA is now expected to be ahead of expectations: ($14.5m; N1S: $13.9m) as a result of a higher than expected proportion of Digital Privacy sales. Management guidance targets revenue growth of 85% and adjusted EBITDA growth of >150% in FY’20E (inc acquisition of PIA), in-line with expectations, and we make no changes to forecasts at this time. FY’20E OpFCF yield is forecast at 5%, ahead of comparative high-growth peers.

Companies: Kape Technologies

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

20 Jan 20

Kape Technologies

Strong trading update; Buy

Companies: Kape Technologies

16 Jan 20

CloudCall

FY trading update: In rude health; Buy

Companies: Cloudcall Group

20 Jan 20

Cenkos: Seeing Machines Ltd -- The DMS challenge palpable at CES2020

Interior and Occupant Monitoring was a notable theme of CES2020 with around fifteen different concepts demonstrated, up from three in 2019. However, these did not outnumber Driver Monitoring System (DMS) demonstrations and did little to deflect from the openly discussed challenge of sourcing and designing reliable primary safety DMS at appropriate costs for the automotive mass market. This task is being exasperated by a confluence of factors including vehicle design complexity and regulatory time pressure, and especially in the absence of knowing what technical specifications are required to meet the forthcoming Euro-NCAP and EC certification standards. We view the many demonstrations of IMS/OMS and emotional analysis as a distraction from the DMS challenge and, in this respect, our primary thesis for Seeing Machines remains unchanged following what we saw at CES2020: We believe Seeing Machines remains on track to win the largest market share of the DMS safety system market. We maintain our Buy recommendation and 12p DCF derived price target which is based on a 16% discount rate.

Companies: Seeing Machines

20 Jan 20

The Industrial Revelation

US factory output rises in Dec better than expected, Schlumberger sees continued weakness in North America, Fastenal saw a continued slowdown in Q4

Companies: HEAD HILS HTG JHD RNO SCPA TRI ZTF SOM

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

20 Jan 20

Hurricane Energy - Updated drilling campaign for 2020–21

In December 2019, Hurricane Energy provided a trading and operational update on its activities, announcing a strong ongoing performance of the Lancaster early production system (EPS), with well tests supporting guidance of 20,000bopd for FY20 (before operational downtime). Hurricane was also granted a five-year extension to its P1368 licence, covering Lancaster and Lincoln, which resulted in changes to its near-term work programme. One or more sub-vertical wells will be drilled on both Lincoln (in 2020) and Lancaster (in 2021) to determine the maximum vertical extent of each reservoir. Hurricane estimated FY19 revenue of c $165m and year-end unrestricted cash of c $150m, relatively in line with our estimates for the year. Our risked valuation stands at 109.9p/share (from 102.8p/share) as we roll forward our NAV, adjust our short-term oil price assumptions and update forecasts to reflect Lancaster EPS performance and the 2020–21 work programme.

Companies: Hurricane Energy

20 Jan 20

LIBERUM: AFH Financial Group* - Impressive growth and positive outlook

In FY19 AFH delivered 8% organic net flows and revenues are up 47% yoy. The revenue model change in Protection responds to investor concerns and leads to significantly increased cash conversion.

Companies: AFH Financial Group

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

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

21 Jan 20

Metronomic growth

dotdigital’s trading update to December reveals sales and adj. PBT growth in line with N+1 (and consensus) forecasts, while period-end net-cash of £22.5m infers >100% cash conversion. The company’s growth drivers remain consistent: geographical and ARPU expansion – here we flag 18% and 51% US and APAC growth respectively, meanwhile ARPU expanded 14% to £999/user/month. We expect ARPU to improve further, as more customers use the omnichannel functionality offered within the Engagement Cloud. Equally, international expansion should also remain a core theme, as here, DOTD’s low level of penetration in sizable markets provides a multiyear growth opportunity in our view. No changes to forecasts.

Companies: Dotdigital Group

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

20 Jan 20

A doubly-strong finish to 2019

Kape has today published a trading update for its 2019 year. The group, in addition to the November acquisition of PIA, has revealed a strong close to the year, with Adjusted EBITDA slightly ahead of expectations. We make no changes to our revenue and EBITDA forecastsfor 2020, which remain within the range of guidance provided, but take significant comfort from the fact that Kape has now delivered both strong organic outperformance and a transformational acquisition in recent months.

Companies: Kape Technologies

21 Jan 20

Learning Technologies surges as it raises full-year guidance

21 Jan 20

Carclo - Stabilising the business

Carclo’s H120 results show that the remaining businesses following the exit from Wipac in December provide a basis for a sustainable group going forward. The continuing businesses generated £56.1m revenues and £3.3m underlying EBIT. However, there remain significant challenges in reaching agreement on long-term funding with the lending bank and pension trustee. Our estimates will remain under review until these are resolved.

Companies: Carclo

21 Jan 20

Better Q4 profit but downgraded return target, $600m disposal gain 2020

• Q4 net profit somewhat above consensus expectations • Dividend per share increased from CHF0.70 to CHF0.73 for FY2019 • UBS downgraded its RoCET1 target from 15% for 2019 and 17% for 2021 (ambition) to 12-15% for 2020 to 2022 • Majority stake sale of Fondcenter leads to a nice disposal gain of $600m after tax in 2020

Companies: UBS Group

21 Jan 20

Clear miss in a challenging situation

Lonza reported a mixed set of condensed 2019 figures, which were below our expectations (EBITDA: -5%) but broadly met consensus based on adjusted figures. The company’s performance was driven by Pharma Biotech & Nutrition while Specialty Ingredients’ profitability was able to broadly absorb the lack of the former Consumer Health & Nutrition business (now reported under Pharma Biotech) and the carve out.

Companies: Lonza Group

21 Jan 20

FY19 in line but order-intake still a bit weak

FY19 numbers were broadly in line with our and the street’s expectations. The long-cycle businesses have been doing well, while the short-cycle ones are still under pressure. Visibility remains low for the latter, explaining our rather cautious top-line expectations going into FY20. The separate listing of SMT will be another focus for investors in the current year (c.15% of total revenues).

Companies: Sandvik

21 Jan 20

Talking Tungsten with Roskill's Jessica Roberts

21 Jan 20

Global focus for The Brunner Investment Trust

21 Jan 20

Executive interview - InMed: Leading the way in the therapeutic development of cannabinol (CBN)

21 Jan 20

Quadrise all set to clean up in 2020 after a spot of housekeeping

21 Jan 20

RhoVac - Phase IIb BRaVac study enrolling patients

RhoVac’s Phase IIb BRaVac study with RV001 (a cancer immunotherapy against RhoC) is up and running with patients being recruited in six European centres since November 2019. In total, over 175 prostate cancer patients, who experienced biochemical failure after a curative therapy (surgery or radiation therapy), are expected to be enrolled by the end of Q320. The primary endpoint is time to PSA doubling or clinical progression and key interim results are expected in H221 (the treatment part of the study), with follow up data due in H222. Besides the BRaVac study progress updates, RhoVac released more supportive immunological data from the completed Phase I/II trial, and, unexpectedly, an unrelated group of researchers published a detailed review of RhoC as a target. Our valuation stays virtually unchanged at SEK888.6m or SEK46.7/share.

21 Jan 20

Executive interview - InMed’s cannabinol (CBN) formulation for glaucoma

21 Jan 20

Gaming is back

Logitech’s Q3 results beat expectations with sales up +5% thanks to Gaming which returned to double-digit growth (+16% in cc) and consistent growth in Video Collaboration (+25% in cc). Effective margin management despite incremental China tariffs (List 4). Even though Logitech is now trading at premium multiples above historical averages, we still like the equity story.

Companies: Logitech International

21 Jan 20

9M sales and orders reasonable, earnings negative

The lack of volumes and intensifying price pressure have resulted in quite sizeable operating and net losses in the last quarter. In addition and as business conditions remained weak in Germany and most of Europe, the product mix changed which resulted in further profit pressure.

Companies: Heidelberger Druckmaschinen