16 Jan 19
Cenkos: Seeing Machines Ltd - Half year trading update
Seeing Machines has announced a trading update for its half year ended 31 December 2018 where the Board's expectation for FY2019 remains unchanged ie for revenues approximately in line with FY2018 of A$30.7m. The Automotive sector continues to dominate the news with Seeing Machines noting that it is currently in six RFQs worth A$140m, with decisions expected by the end of the financial year. This could double the minimum projected revenues from existing OEM awards. Seeing Machines also expects another 3-4 automotive RFQs going live this financial year demonstrating the strong momentum in the sector following regulatory drivers such as Euro-NCAP.
Companies: Seeing Machines
16 Jan 19
Trading ahead of expectations, 5% EPS upgrade
The company has announced a positive trading update signalling a stronger than expected H2, with sales and EBITDA moderately ahead and cash more meaningfully ahead of expectations. We upgrade our 2018 EPS forecast by 4.9% and raise 2019 by 4.6%, confirming robust trading continues. The company has also announced a small bolt-on acquisition of Line Dragon for $2.0m, which looks an ideal close fit. The shares have significantly derated and the trading update confirms robust trading continues, thus providing a strong buying opportunity. The 7% dividend yield and single digit P/E in 2019 highlight strong value – this quality stock is one of our favourites.
Companies: Somero Enterprises
14 Jan 19
UK Housebuilding Sector in 2018
‘From the deserts of East Ham to the gardens of Cottenham’, the UK Housebuilding Sector was whacked to the tune of 27% in 2018; and not one share price (out of 18) rose on the London Stock Exchange.
Companies: BWY CRST BDEV WJG PSN RDW TW/ MCS CSP TEF BKG ABBY GLE
14 Jan 19
We are introducing our Best Ideas for 2019 and also review the performance of last year’s picks. We suggest ten solidly financed stocks with good business dynamics that ought to be considered for core portfolio holdings and six UK domestically focused stocks that our analysts believe should perform strongly in the event that uncertainties unwind. We also introduce a new style of research from N+1 Singer which presents a Company’s dynamics and metrics in a clear and concise manner and concentrates on the pivotal issues affecting that Company and an investment decision.
Companies: BCA CLIN CLG CBP DNLM EAH FDL FCRM FUTR GTLY INS GLE NICL SDL SPR TRI
15 Jan 19
Top line on song for further growth
Gear4music’s recent FY2019 profit warning prompted a stark share price reaction. However, there was no let-up in sales growth. As intended, Christmas market share improved at Gear4music and top-line expectations remain intact. Moreover, gross margins should end the year making progress on FY2018. There are good reasons to be positive, which now include valuation.
22 Jan 19
Sirius Minerals (SXX) – Corporate – Q4 2018 Update | Caspian Sunrise (CASP) – Corporate – Completion of A3 Best Acquisition | Sanderson Group (SND) – Corporate – AGM Update | Spectra Systems (SPSY) – Corporate – Small but meaningful contract win | Dillistone Group (DSG) – Corporate – GatedTalent to be profit and cash positive by Q419
Companies: SXX CASP SND SPSY DSG
18 Jan 19
LIBERUM: Miton Group* - Record annual netflows, markets in Q4 reduce EPS by 4%
The Q4 trading statement confirms a record year for net flows. AUM finished the year at £4,376m vs. £3,823m in 2017.
Companies: Miton Group
15 Jan 19
Revenue +44%, Gross margin +170bps, FY19 Guidance upgraded
The boohoo Group has announced a 44% YOY increase in revenue for the four months to 31 December 2018 and upgraded full year revenue guidance for FY19. Trading over the key Christmas period has seen growth across all divisions and regions, bucking the trend of downbeat trading results seen across the wider retail sector. Of particular note, is this top-line progress has been delivered alongside a +170 basis-point expansion in Group gross margin YOY to 54.2%, at a time when heavy discounting has seen many of its peers’ profitability decline. This impressive gross margin performance YTD reflects the strengths of boohoo’s brand led model, giving it the ability to be more aggressive in its price positioning as and when the market demands. We believe the Group’s well invested model creates significant potential for further operational leverage as it builds towards its ambitious £3bn mediumterm revenue target. The business is backed by a solid balance sheet with net cash of £189m at 31 December 2018, reflecting the strongly cash generative nature of the Group. The shares currently trade on an FY19 PE of 48.1x, falling to 41.1x in FY20. When taking into account forecast earnings growth the shares trade on 2.1x, a notable discount to ASOS and Zalando.
17 Jan 19
Small Cap Feast
Circassia Pharma (CIR.L) - specialty pharmaceutical company focused on respiratory disease transferring from the Main Market. No funds being raised. Due 4 Feb. Greenfields Petroleum (TSX-V:GNF) production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.
Companies: ORCP IOF FOX TEG XLM TAP FST SNG ARE SRB
15 Jan 19
LIBERUM: Frontier Developements* - Record first half / encouraging holiday season sales
As expected H1'19 was a record half for Frontier, with the highly successful launch of Jurassic World Evolution, their first licensed IP release, and as importantly, good contributions from Elite Dangerous and Planet Coaster. The company has had a positive start to H2, with holiday season promotions and new content, delivering strong unit sales across all three franchises, and importantly very encouraging player engagement KPIs.
Companies: Frontier Developments
21 Jan 19
LIBERUM: The 4S’s - The negative working capital model in Construction is changing
Four measures are being considered to protect the supply chains in the wake of the Carillion collapse, a year or so ago; 1) Project Bank Accounts, 2) The Prompt Payment Code; 3) Retentions Reform; and 4) Assigning non-executives for the supply chain. (Read here). This means that in most cases, Costain is an exception, working capital will become less negative, which has a negative impact on cash flows, while Construction companies grow.
Companies: AA/ BAB BBY CPI COST GFRD HSV IRV KLR KIE MER MTO MGNS PAY RPS SRP STAF
16 Jan 19
Cenkos: 1pm Plc - Moving to the next stage of growth
1pm's H1/19A results reflect the first financial year since FY15A to not consolidate a new acquisition, following the successful completion of the buy & build strategy. The group is currently focused on organic delivery, witnessed in strong, broad-based YoY performance (adj EPS (FD) +16%) and positive indicators today on group integration and cross-selling. Demand from UK SMEs for this now multi-product offer remains strong despite the current macro-economic uncertainty, with material originations growth at stable rates. We continue to view the stock's current deep undervaluation as disconnected from the earnings accretive progress made over the past three and a half years.
21 Jan 19
Cenkos: CloudCall Group Plc - Excellent partner testimonial
The Capital Markets Day highlighted the positive market dynamics and large addressable market CloudCall is successfully selling into. Customer testimonials point to considerable potential upside in both the US and Europe. New products and future CRM partnerships enlarge this still further. We remain Buyers.
Companies: Cloudcall Group
15 Jan 19
Share & share alike
It may only be a fortnight into the new year but many of the factors that unnerved the market last month have continued to impact sentiment. The outcome of trade talks between the US and China, concerns about global economic growth and some poor trading statements, especially in the retail sector, have all featured. Above all, Brexit and the progress of the Withdrawal Bill have dominated with the latest “high noon” due later. Despite this, we have seen a good rally in the junior markets year to date. In Share News & Views we comment on Bloomsbury, DeepMatter*, James Fisher and Helios*.
Companies: AOR APC BONH BMS CTG CRPR DMTR ESC EUSP FDM FA/ LSAI NKTN PCF SNX TCN W7L
16 Jan 19
Positive trading update for FY 2018E
Kape has issued a trading update which confirms a strong finish to 2018, with Adjusted EBITDA likely to be slightly above consensus at U$10.4 million – up around 25% on the prior year. Revenues were U$56.4 million, down as expected on the prior year after the sale of the Media business. The Group ended the year with cash of U$40.3 million. We adjust our FY 2018E estimates to reflect these numbers which means that our revenue estimate reduces by 8% while Adjusted EBITDA increases by 2%. For FY 2019E, we leave estimates unchanged given the momentum in the business and await further detail in the March final results announcement. The proportion of subscription revenue has increased again, as the Group continues to transition customers while customer retention has improved further. Over the year, the Group’s subscriber base increased by 219% to c. 830,000 users. In line with November’s update on Intego and ZenMate, the integration of both acquired businesses is progressing ahead of management expectations and management continues to expect the benefits of the implementation of Kape’s user acquisition capabilities to be realised in 2019. In all, this is a very encouraging update with progress on user acquisition particularly of note.
Companies: Kape Technologies
22 Jan 19
Reassuring Q1 figures despite the drone disruption at London Gatwick
Q1 revenue was up 13.7% yoy to £1.3bn, broadly in line with the company’s initial expectations. The figures were mainly supported by the solid passenger numbers and growing ancillary revenue, despite the cancelled flights and lost revenue resulting from the drone issue at London Gatwick (c.£15m impact). However, the non-repetition of one-off benefits (bankruptcies of Air Berlin/Monarch, Ryanair/SNCF cancellations) in the prior year, along with the Berlin-Tegel Airport still in the early stage of optimisation, have together brought the total revenue per seat down by 4.2% at constant currency, which is in line with the company’s expectations (the company had expected revenue per seat to decrease by a low-to-mid single-digit in H1 19). EasyJet continues to be very active in preparing for Brexit. The company now has 130 aircraft registered in Austria and has increased its EU ownership to around 49% to mitigate the Brexit concern. Outlook updated: • EasyJet expects FY 19 capacity to increase by c.10% and sees H1 19 growth of c. 15%. • Revenue per seat at constant currency for H1 19 is expected to be down by a mid-to-high single-digit.
22 Jan 19
No major surprises in Q3
There were no major surprises in the Q3 results. We expect the UK businesses to remain weak in the near term even if the company is succeeding in gaining market share. Any tangible progress towards implementation of the recently-announced turnaround plan would be the biggest upside trigger for the stock price. No change in our stock recommendation.
Companies: Dixons Carphone
22 Jan 19
Impressive Q3 19 results, guidance raised for 2019
Logitech reported a strong set of Q3 19 results, which were above consensus on both the top- and bottom-line. Once again, Gaming and Video Collaboration are the biggest drivers which have contributed to growth and, hence, allowing the company to raise its non-GAAP operating income guidance for 2019. At this stage, we consider that the main risk is related to the ongoing discussions between the US and China, and any improvement would have a positive impact on the stock.
Companies: Logitech International
22 Jan 19
Cenkos: RA International Group Plc - Valuation mismatch gone too far
RA International shares have fallen significantly since December 2018 when it announced that several contracts were delayed into early 2019 and stated that revenue and profits for FY18E are expected to be “slightly behind market expectations”. We thus reduced our FY18E revenue and profit forecasts by c10% to reflect these contract timing differences. We left 2019 and 2020 forecasts unchanged given the extensive level of bidding activity undertaken during the year (doubling to cUS$400m between the June 2018 float and September 2018 interims alone) and reference to increased revenue backlog in the trading update. The fundamentals remain intact with RA positioned to win more larger scale contracts with existing and new customers.
Companies: RA International
22 Jan 19
Will Remy Cointreau be able to take advantage of China ?
The group reported strong Q3 results, which have pushed up the 9m FY18 figures. Sales grew by +8.7% organically and +9.5% on reported figures in Q3 (+8.1% organically and +6.7% on reported figures in 9m FY18) to €345.3m, leading to €931.5m of total sales during the first nine months of 2018. The House of Remy Martin division is still the best performer (+15.6% and +13.1% organically in Q3 and 9m FY18 respectively), while the Liqueurs & Spirits division reported a shy 9m FY18 growth, thanks to the Q3 contribution (+2.3% and +5% respectively). The Partner Brands division continued to decline, consistent with the group’s strategy to refocus gradually on Group Brands (-26.8% and -13.6% respectively in Q3 and 9m FY18). The FY guidance is maintained: the group expects positive growth in current operating profit.
Companies: Remy Cointreau
22 Jan 19
Ariana Resources - Kizilcukur Development Update
22 Jan 19
Another battery factory to be located in Poland
Daimler’s strategy is to offer various electric alternatives for each of its car segments by 2022. It has decided to assemble the batteries in its own factories but to purchase the cells on the world market.
22 Jan 19
The Mission Marketing Group - Good reasons to krow
Themission’s FY18 trading update indicates that it expects to deliver results in line with market expectations; 10% top line growth and a 20% step-up in headline PBT (adjusted for start-up and acquisition costs). The revenue growth is half organic and half stemming from April’s acquisition of krow Communications, best known for its work with Aardman for DFS. This will be the eighth successive year of group revenue and headline PBT progression, with the dividend growing steadily since its reintroduction for FY14. With improving operating margins and a strengthening balance sheet, this record is clearly inconsistent with the deeply discounted rating.
Companies: The Mission Marketing Group
22 Jan 19
1Spatial - Spatial awareness
1Spatial’s transition plan appears to be on track. Recent contract wins, US trends and mobile solutions should both sustain growth and ensure it reaches profitability and positive free cash flow targets. In the longer term, its ambition to become a leading location master data management (LMDM) supplier has the potential to enhance both its competitive position and strategic value. Success is not guaranteed but we would argue that, trading at 1.3x FY21e EV/sales, nor is it factored into the valuation.
22 Jan 19
Globalworth Real Estate - CEE office landlord of choice
With a strong and liquid balance sheet, Globalworth (GWI) is well placed for further growth. The Romanian and Polish economies in which it operates are performing strongly and well above the EU average, creating a favourable environment in which to add value to existing assets, undertake further developments and make accretive acquisitions.
Companies: Globalworth Real Estate Investments
22 Jan 19
Mixed Q4 and improved FY18 figures
Pre-tax profit increased by 2% to $862m for Q4 18 compared to Q4 17. Total operating income was down by 3% to $7.0bn for Q4 18 compared to Q4 17. Total operating expenses declined by 4% to $6.1bn compared to Q4 17. UBS reported a net profit attributable to shareholders of $696m for Q4 18. UBS reported a loss of $2.4bn for Q4 17 due to a booked charge of $2.9bn on DTA (deferred tax assets) by the US tax reforms. Net new money outflow was close to $13bn for Q4 18. UBS released preliminary figures for FY2018 too. Pre-tax profit rose by 19% to $6.4bn for FY2018 versus FY2017. Total operating income was up by 2% to $30.2bn for FY2018. Total operating expenses decreased by 2% to $23.8bn for FY2018 compared to FY2017. Personnel expenses were flat at $16.1bn in the same period. The charge of CHF2.9bn on DTAs by the US tax reforms, booked in Q4 17, burdened FY2017 as well. Net profit attributable to shareholders was $4.9bn for FY2018 compared to $969m for FY2017. It rose by 25% for FY2018 compared to adjusted FY2017. The RoE was 9.3% for FY2018 versus 1.8% for FY2017. Adjusted RoTE (return on tangible equity), was 13.8% for FY2018 compared to 13.7% for 2017 excluding DTAs. Net new money inflow was $57bn in FY2018 compared to CHF103bn in FY2017. Invested assets were down by 5% to $3.1tn at the end of 2018 compared to the end of 2017. UBS’s fully-applied Basel III common equity tier 1 (CET1) ratio was 13.1% at the end of 2018 compared to 13.8% at the end of 2017. The fully-applied CET1 leverage ratio was 3.81% at the end of 2018 compared to 3.69% at the end of 2017. The proposed ordinary dividend for FY2018 increased by 8% to CHF0.70 per share. UBS is targeting to repurchase up to $1bn of shares in 2019. Beginning in Q4 18, UBS changed its presentation currency to US dollars following changes in the functional currencies of UBS (formerly CHF). However, the impact is negligible as the current $/CHF exchange ratio is 1.00.
Companies: UBS Group
22 Jan 19
Record - Another performance fee to bolster FY19
Record’s Q319 trading update showed a 6.5% decline in AUME, reflecting a combination of outflows, market weakness and foreign exchange moves. This leads to a 10% reduction in our FY20e earnings. For the current year the negative effect is more than offset by crystallisation of a further performance fee, which is a reminder of the potential for positive earnings surprises in subsequent periods, where we assume none. Following further price weakness, the valuation appears cautious.
22 Jan 19
Cenkos: Empyrean Energy Plc - Indonesia Update
Yesterday, Empyrean Energy announced that an independent audit by Gaffney, Cline & Associates (GCA) has estimated 2C contingent resources of 276 billion cubic feet (Bcf) to the Mako gas field, situated in the Duyung PSC, offshore Indonesia. The operator, West Natuna Exploration Limited (WNEL), has converted the Duyung PSC to the new Indonesian Gross Split PSC allowing for greater contractor spending and operational flexibility.
Companies: Empyrean Energy
22 Jan 19
Ideagen - Low risk and high activity in risk management
Interims are in line with guidance, as ever, including a boost in activity across the group, particularly SaaS and the US. 8% organic revenue growth was complemented by 67% recurring revenue (FY18: 62%), growing cash generation, and a continuing strong track record of acquisitions. The board structure implemented for FY19 is proving its worth, in delivering continuing operational excellence in addition to strategic acquisitions as the Integrated Risk Management market consolidates. Clients won in the period – household names including GlaxoSmithKline and McLaren Mercedes – reiterate product quality. Target 180p reiterated as Ideagen continues to lead the sector by example.
22 Jan 19
MOD Resources - Sandfire’s bid undervalues MOD
MOD Resources has raised A$10m through an oversubscribed institutional placing at a price of A$0.30/share (17p/share), a 36% premium to the closing price on 18 January 2019. The company also intends to raise a further A$5m through a fully underwritten rights issue at A$24/share (13p/share). In addition, the company has received an unsolicited, non-binding, indicative all-share offer from Sandfire Resources (SFR:AU) at a price of A$0.38/share (21p/share). The board of MOD believes the Sandfire offer undervalues the company’s assets.
Companies: MOD Resources
22 Aug 18
Grafton Group - Interim Results 2018
28 Dec 18
Highlights 2018: Hipgnosis - Welcome ceremony
28 Nov 18
LondonMetric Property PLC - Half Year Results 2018/19 interview
20 Nov 18
Entertainment One (ETO) H1 results interview November 2018
31 Dec 18
Highlights 2018: redT energy - 5 minute masterclass: energy storage in the UK
23 May 18
Assura - Full Year Results 2018
20 Jun 18
Bank of Georgia and Georgia Capital - Welcome Ceremony
19 May 17
Leading UK fund manager, Gervais Williams, discusses investing, his outlook and two companies he's excited about
11 Dec 17
Capital Network's Ed stacey on Diploma PLC
22 Nov 18
Assura - Half Year Results 2018
11 May 18
Harbourvest - 10 years of success and the future of Private Equity
30 May 18
LondonMetric Property PLC - Full Year Results 2018 interview
21 Sep 18
InnovaDerma PLC's growth trajectory 'very much back on track'
23 May 17
Assura plc - Full Year Results
09 Oct 18