Trackwise has confirmed the results of its open offer, which was oversubscribed and, together with a placing, has raised £12.6m (gross). This will fund a new manufacturing facility that will quadruple IHT production capacity. The additional capacity is required to support the up to £38m electric vehicle (EV) contract announced in September and potential volume orders from electrosurgical catheter manufacturers and aerospace OEMs and suppliers. It will also support future production for nuclear fusion, pipe-leak detection and micromotor winding applications.
Companies: Trackwise Designs Plc
Companies: Parkmead Group PLC (PMG:LON)Trackwise Designs Plc (TWD:LON)
Trackwise has announced a placing and open offer, potentially raising up to £12.0m (gross). This is to fund a new manufacturing facility that is expected to quadruple IHT production capacity. The additional capacity is required to support the up to £38m electric vehicle (EV) contract announced in September and potential volume orders from electro-surgical catheter manufacturers and aerospace OEMs and suppliers.
The group has announced it has successfully raised £11m in an equity placing to help accelerate capex on a new IHT manufacturing site based on guaranteed minimum production volumes and ahead of anticipated customer orders. It is expecting a significant ramp up in production in FY21 following a multi-year £38m production order from a UK-based EV manufacturer. Strong progress is being made with its customer trials for the medical catheter market, which together with other expected new business requires additional capacity to be put in place.
Trackwise Designs has developed a proprietary, proven technology, IHT, for manufacturing extremely long, flexible circuits that can replace conventional wiring harnesses. This disruptive technology is applicable to many industries including electric vehicles (EVs), medical devices and aerospace. Trackwise has already manufactured prototypes for customers in each of these sectors and received its first series production order from an EV manufacturer this September. Since IHT is an adaptation of the proven technology Trackwise uses for making advanced printed circuits, IHT has the transformative potential of a new technology but with much less risk.
Allergy Therapeutics (AGY): Corp FY 2020 – record pre-R&D EBIT | Amino Technologies (AMO): Corp Argentinian software contract win | ANGLE (AGL): Corp Peer reviewed publication, using Parsortix in MBC | Bigblu Broadband (BBB): Corp Quickline secures up to £6.1m of subsidy in Lincolnshire | Hardide (HDD): Corp Trading in line with a stronger Q1 expected | Trackwise Designs (TWD): Corp Interim results, new contracts boost confidence | Xeros (XSG): Corp Commercial progress tracking in line with expectations
Companies: AGY AMO AGL XSG TWD BBB HDD
The interims reflect COVID challenges, which reduced order intake, and the acquisition of SCL. A milestone three-year agreement with a UK-based EV OEM was recently awarded, potentially worth up to £38m, which substantially underwrites further growth prospects. In the short term however, we reduce our FY20 forecasts, although with the EV contract kicking in next year, we see good growth coming through.
Trackwise Designs has signed a three-year product manufacture and supply agreement with a UK electric vehicle OEM. The agreement is potentially worth up to £38m in total, subject to pricing revisions, and will generate up to £5.0m in revenues in FY21. This will be the first full series production of flexible circuits incorporating Trackwise’s Improved Harness Technology (IHT). The agreement represents a step change in sales as total revenues for H120 were £2.4m, of which IHT was only £0.3m.
Crimson Tide (TIDE): Corp Growing long-term subscription revenues | Gemfields (GEM): Corp 1H20 results | Trackwise Designs (TWD): Corp Production contract with EV manufacturer
Companies: GML TWD TIDE
The company has announced a major milestone contract agreement, its first for full series production of IHT products. The contract is with an Electric Vehicle (EV) manufacturer, with a maximum revenue value of £38m over the next three years. Recent market headwinds have understandably resulted in some slippage in half-year revenues and a reduction in profit. This is a significant milestone production agreement, with huge future upside potential from the wider adoption of IHT flexible printed circuit boards.
ECSC Group plc* (ECSC.L, 71.5p/£7.2m) | Trackwise Designs plc (TWD.L, 90.5p/£20.0m) | Transense Technologies plc (TRT.L, 59.5p/£9.7m)
Companies: ECSC Group Plc (ECSC:LON)Trackwise Designs Plc (TWD:LON)
Updating forecasts following 2019 results
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Boohoo has delivered strong results over the peak trading period for the four months ended 31 December 2020. Group revenue is +40% YOY, with robust growth seen across all brands and regions. The Agenda for Change programme is progressing at pace, demonstrating the Group’s commitment to setting a new standard for ethical supply chains in the fashion industry.
Companies: boohoo group Plc
Today's news & views, plus announcements from JET, PSN, SONG, HWDN, MSLH, PAGE, WMH, ASC, BGO, CUSN, CAY
Companies: Bango plc (BGO:LON)Persimmon Plc (PSN:LON)
Although 2020 will probably go down in history as one of the most challenging years experienced during our lifetime, it will also likely be chronicled as one of the best years for the recognition and appreciation of science. As we entered 2020, the COVID-19 pandemic was in its infancy. However, it rapidly evolved through the exponential rise in infections and mortality globally. Much has been achieved during the past 12 months in the fight against COVID-19, but, as we enter 2021, there are considerable concerns about the emergence of a mutant version of the virus and the second wave that we are now facing.
Companies: AVO ARBB ARIX BBGI CLIG DNL FLTA ICGT OCI PCA PIN PHP RECI STX SCE TRX SHED VTA YEW
Cenkos Securities plc has terminated coverage of RA International Group Plc. Our previous recommendation (BUY) and forecasts can no longer be relied upon. Please contact Cenkos for further information.
Companies: RA International Group Plc
A positive Y/E trading update from Portmeirion this morning with the full year outcome comfortably ahead of market expectations. There is a c7% revenue beat vs our forecast which flows through to us upgrading our FY20 PBT from £0.2m to £1.2m - a highly pleasing outcome in the context of our deep value/recovery/new management thesis. The outperformance was led by the UK/USA where trading proved robust in H2 despite lockdown due to strong online momentum. We keep our outer year profit forecasts unchanged at this stage given the CV19/macro backdrop, but understand current trading is positive with both factories open and the order-book healthy. Management is fully focused on executing the strategic growth plan outlined at the time of the June’20 fund raise and we expect a fuller update at the March finals. Overall, today’s update is a step in the right direction in building confidence in the growth / online plan and should be well received by investors
Companies: Portmeirion Group PLC
Accrol has delivered strong H1 results, with underlying EBITDA +69% YOY driven by stronger than expected gross margins as mix benefits continue to come through. We maintain earnings forecasts for now, albeit believe these to be well underpinned by margin improvements, synergies and growth. We believe Accrol is well positioned to emerge as a £35-40m EBITDA business over the medium term, in what we see as an exciting period for the Group.
Companies: Accrol Group Holdings plc
Residential for rent developer and manager Watkin Jones today posted FY 2020 results, in which profits, cash and dividend beat our estimates by c. 4 - 5%. We have maintained our FY 2021E forecasts and introduced estimates for FY 2022E. Our growth assumptions are supported by further evidence in the statement of a revival in forward funding by institutional investors for both the Group’s build-to-rent and student accommodation developments. A new strategy is aimed to trial the private residential sales division more to affordable housing, in line with WJ’s low-risk, capital-light model.
Companies: Watkin Jones Plc
Recent news has been positive. Notably, the Group announced a ground-breaking £27.5m contract award with a new OEM customer in mid-September. Trading has been more resilient than we expected at the start of the Covid-19 pandemic, demonstrated by the positive full year pre-close update issued today. Revenue for the year to 31 December (£2m) is in-line with our forecast but gross cash is better, by c.£250k. Operational developments continue apace, and reflecting a healthy pipeline and expanding workforce, a dedicated HR executive has been hired. Confidence in the medium-term demand for the Group’s products has improved with recent contract wins; management now believes its Knowsley factory, when fully built-out, will be able to generate £75m of revenue each year against £50m, previously. Our estimates are unchanged pending the full May statement but with a stronger medium-term outlook, we lift our valuation to 65p from 57p.
Companies: Surface Transforms plc
Victoria has issued a trading update highlighting that the strong performance it announced in H1 has continued, with the Group achieving record revenue and operating profit for Q3 to end December. Group revenue was ahead by more than 10% in Q3, in part due the acquisition of the business and assets of Ascot in February 2020. We see the statement as reenforcing the positive messages made at the time of the interim results at the end of November that demonstrated the resilience of the Group. Performance is benefiting from strategic investment in logistics and service in 2019, operational efficiencies, consumers focusing on refurbishing their homes and maintained production and deliveries to satisfy demand. As in November, there will be a UK lockdown impact in Q4, albeit the Board believes Victoria is well placed to meet this headwind. We have no formal forecasts and will initiate In due course.
Companies: Victoria PLC
Boohoo has announced meaningful progress in its Agenda for Change Programme, to deliver long lasting change to its supply chain and business practices. Sir Brian Leveson PC has been appointed to provide independent oversight of the programme, with KPMG engaged to provide additional resource, expertise and independence, working alongside the Group’s internal responsible sourcing and compliance team, as well as with external supply chain audit specialists Bureau Veritas and Verisio. We believe the calibre of the appointments reflects the Group’s unwavering commitment to implementing in full, and with complete transparency, all recommendations of the Independent Review.
Tern plc* (TERN.L, 7.1p/£23.5m) Portfolio update: Strong business momentum (12.01.21) | Audioboom plc* (BOOM.L, 276p/£43.3m) Expanded content network (15.01.21)
Companies: Tern Plc (TERN:LON)Audioboom Group PLC (BOOM:LON)
Games Workshop Group’s (GAW’s) H121 trading update highlights that it has enjoyed a stronger end to the period than expected by management: H121 PBT will be not less £90m (y-o-y growth of c 54%), £10m higher than indicated in the 7 November trading statement (see our recent update note). Therefore, GAW’s PBT in H121 is greater than that for the whole of FY20. The strong performance leads to a 40% increase in the year-to-date dividend, as the company continues to distribute truly surplus cash. We upgrade our PBT forecasts for FY21 by a further 6%. Following the relative weakness in the share price in recent weeks, and the upgrade to our forecasts, the P/E multiple of 28.9x for FY21e is back below recent highs.
Companies: Games Workshop Group PLC
Real progress towards significant value generation
Companies: Tern Plc
Tern plc* (TERN.L, 8.0p/£24.1m) | Corero Network Security (CNS.L, 8.25p/£40.8m) | Eagle Eye Solutions Group plc (EYE.L, 288p/£86.9m)
Companies: TERN CNS EYE
We initiate on Portmeirion and argue that it is in a better position than the current market valuation suggests. It has delivered a resilient first half and, following a strategy reset under the new CEO, it has much more enhanced capabilities with an improving model and profit outlook. Furthermore, Portmeirion is well funded with no balance sheet concerns. The shares trade on low spot multiples of 10x FY21 P/E with and 5x EV/EBITDA with a 9% FCF yield. A SOTP analysis based on peer/corporate deal metrics shows fair value towards 650p. Patient deep value investors should take a much closer look.
