Hybridan Small Cap Feast: 19/07/2023

Joiners: No joiners today. Leavers: No leavers today. What’s cooking in the IPO kitchen?** Substrate Artificial Intelligence, an artificial intelligence company based in Spain that creates, buys and scales companies around AI in diverse sectors such as fintech, agritech, energy, human resources, and health, intends to join the Access Segment of the AQSE Growth Market. Expected Admission 21 July 2023. Blackpoint Biotech plc, a medical cannabinoids company established to fulfil gaps in the medical

PROGRESSIVE: Watkin Jones: Transaction risks cloud current outlook

Watkin Jones has issued new guidance for FY23E, recognising ‘a greater degree of risk’ regarding anticipated forward-funding transactions completing by the 30 September year-end, with lower profitability also expected for FY24E, while it has identified other impairments and charges. We have downgraded our estimates accordingly. Also, CEO Richard Simpson has stepped down and CIO Alex Pease has taken the role on an interim basis.

PROGRESSIVE: Watkin Jones: Investment appetite returns but rephased

Watkin Jones highlights a continued recovery in the institutional funding market in today’s interim results, which were in line with its expectations of a significant H2 weighting for FY23E. This, and attractive new land opportunities, should support its long-run target margins. However, the group has exercised caution in recognising profits on long-term contracts, leading us to cut adjusted PBT by £25m for FY23E, while leaving FY24E unchanged. Longer term, we believe the clamour for rental acco

PROGRESSIVE: Watkin Jones - Half-year update highlights investment revival

In today’s half-year trading update, residential-for-rent developer and manager Watkin Jones highlights revived activity among its institutional investors following a hiatus last year in the wake of the mini-budget. As previously guided, the group expects a strong second-half weighting as the investment pipeline rebuilds. We continue to believe that WJG uniquely addresses the growing need for new rental homes.

PROGRESSIVE: Watkin Jones: Half-year update highlights investment revival

In today’s half-year trading update, residential-for-rent developer and manager Watkin Jones highlights revived activity among its institutional investors following a hiatus last year in the wake of the mini-budget. As previously guided, the group expects a strong second-half weighting as the investment pipeline rebuilds. We continue to believe that WJG uniquely addresses the growing need for new rental homes.

PROGRESSIVE: Watkin Jones: Rising rents attract investors back to market

Residential-for-rent developer and manager Watkin Jones on 25 January delivered FY22 results that were broadly in line with our expectations. Continuing strong demand for its core rental developments, as highlighted in October, was hampered by delays in investment decisions following the mini-budget. We believe recovery has begun, albeit on a slightly shallower trajectory, and current market conditions may offer the group opportunities. Surveys show continuing rental growth, attracting back inve

Hybridan Small Cap Feast - 25 Jan 23

25 January 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment object

PROGRESSIVE: Watkin Jones: RICS survey highlights strong rental market

Today’s RICS housing market survey, in our view, paints a much brighter picture of Watkin Jones’s rental sector than that in the sales market. Surveyors expect strong growth in rents to continue, driven by strong tenant demand and constricted supply. We believe that part of the reason for the arguably excessive reaction of the share price to last week’s trading update may be the weakness of the national housebuilders, but they operate in the currently more challenged sales market.

PROGRESSIVE: Watkin Jones: Board’s share purchases highlight confidence

We note that the Chairman and CEO of Watkin Jones yesterday purchased over 72,000 shares between them after a large fall in the price following that morning’s trading update. We believe this demonstrates management’s view that the market had overreacted to the announcement and that, despite guidance being lowered, they remain confident in the long-term prospects for the residential-for-rent developer and manager. We continue to believe that these prospects will be driven by strong demand from te

Hybridan Small Cap Feast 04/10/22

Dish of the day Joiners: Milton Capital plc (MII.L) has joined the Main Market. Leavers: No leavers today. What’s cooking in the IPO kitchen?** TECC Capital plc, to be renamed EDX Medical Group, intends to join the AQSE Growth Market. EDX operates a molecular biology and diagnostics laboratory in Cambridge, UK, from which it performs research & development, provides Polymerase Chain Reaction (PCR) testing and genomic sequencing services, undertakes quality assurance and has established expertise

PROGRESSIVE: Watkin Jones: Strong rental market offset by margin pressure

Residential-for-rent developer and manager Watkin Jones has confirmed in today’s trading statement a strong operational performance in the second half of the year to 30 September 2022, with investor demand for rental assets remaining strong and good visibility going into FY23E. However, the group said it had encountered some pricing and margin softness as its institutional investors faced increased funding costs. We have reduced our estimates for FY22E and FY23E but remain confident in the

On track for FY forecasts driven by rush to rent

Residential-for-rent developer and manager Watkin Jones has confirmed it is on track to meet FY2022E expectations of rising profits in today’s interim results, which showed an 8% rise in revenue and a temporary decline in adjusted PBT, reflecting previously signalled timing and mix of sales. We are maintaining our estimates for FY2022E-23E, which show 21% compound growth in PBT. Longer term, we expect further growth fuelled by increasing demand for rental property from tenants and internat

FY outlook confirmed with growing pipeline

Residential-for-rent developer and manager Watkin Jones confirms in today's trading statement for the six months to 31 March that it remains confident in its performance for FY2022E, stating that there will be more of a second-half weighting due to weighting of project deliveries. We maintain our estimates for both FY2022E and FY2023E, and also highlight growing investor demand for the group's student and build-to-rent developments.

Earnings beat estimates, driven by BTR hunger

Residential-for-rent developer and manager Watkin Jones today delivered an 11% rise in PBT to £51.1m for FY2021, beating our estimate of £50.0m by 2.2%. There were similar ‘beats’ in EPS and dividend, at 16.3p and 8.2p, respectively, driven by strong operational delivery and cost control. We have maintained our earnings and dividend estimates for FY2022E, growing at over 6%. We have also introduced forecasts for FY2023E, which assume accelerated earnings growth of 31% as the strong development p

Profit ‘in-line’ and cash ‘beat’ in FY21E update

Residential-for-rent developer and manager Watkin Jones has confirmed in today’s trading update that operating profit for the year to September 2021 will be in line with expectations, but that year-end net cash of £125m is £40m ahead of our estimates. We are not changing our FY22E P&L estimates but have increased our net cash in line with the ‘beat’ for FY21E. The statement precedes today’s Capital Markets Day at which WJG will highlight its sustainability and affordable homes strategies against

Surface Transforms - Interim results: a challenging period overcome

Interims were largely pre-announced at the pre-close update. Production continues to steadily ramp up with Q1 technical issues resolved. Increased capacity, including the additional furnace, provides scope for stronger output in Q4. Management guides down FY23 revenues, with H2 now expected to reach breakeven with a profit generated in Q4. This results in a £2.0m increase in FY23 adj pre-tax loss to £4.7m. In FY24 we downgrade adj EPS by 29%. Our target price remains 120p, based on 15x the £150m

Surface Transforms (SCE LN) - Ramp up

Surface is in ramp up phase, significantly expanding factory capacity and starting to fill large OEM orders. We visited the Merseyside factory in August and the transformation over the past 18 months is striking. However, as previously reported, trading in H1 was disrupted by teething problems with production. Manufacturing is back on-track, but we now fully adjust for the impact of this disruption. Our revenue for 2023e is cut to £13m from £16m and adjusted LBT will be £4.5m vs. £2.7m previousl

Allenby Capital - Spectra Systems - Interims

FY23 interims from Spectra Systems Corp (SPSY.L), a leader in machine-readable high-speed bank note authentication, brand protection technologies, and gaming software, indicate that the company is well set to hit forecasts and achieve another record year. Revenue +25% to $11.6m and adj. EBITDA by 55% to $5.9m. The balance sheet remains strong with net cash of $16.6m (FY22: $17.5m) - operating cash flow of $4.4m offset by the $5.2m dividend paid. The outlooks remain positive in both the short and

Allenby Capital TMT Update - 25.09.23 - SPSY.L, BIRD.L, TRAK.L, ENET.L

Please find below our weekly update covering themes that we feel that are of interest to investors and participants in the small and mid-cap TMT sector as well as commentary on recent newsflow.

Hybridan Small Cap Feast - 26 Sep 23

26th September 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment ob

Spectra Systems - Punchy H1 feeds into FY2023 and longer term opportunities

Strong H1 results from SPSY today reflect excellent traction with key customers, markets and technology. The company is a leader in machine-readable high speed banknote authentication, brand protection technologies and gaming security software. H1 sales rose 25% to $11.6m YoY (H1-22: $9.3m), benefiting from strong material sales and contracted development revenue, driving 59% increases in adj. PBTA to $5.8m (H1-22: $3.7m). Adj. EPS of 10.8c represents a 72% YoY increase, with the tax burden in

Taking the Upper Brand: Brands Sector Overview

The earliest dated brand has long been contested; the majority point to Kongō Gumi, a family run construction company that specialised in Buddhist temples in Japan; its documented record of ownership goes back to 578 AD. Like Kongō Gumi, several different brands have withstood the test of time, albeit without then same degree of longevity. The term brand originates from the 1500s and means "to burn" in Ancient Norse and was initially used to mark cattle for ownership. This practice can be consid

Morning Note – 27 September 2023

LIBERUM: Science in Sport: The start of rebooting the equity case

Accrol Group Holdings (ACRL LN) - FY23 results in-line, FY24 upgraded

Broad based growth in volumes and value: Revenue of £241.9m is +51.7% YOY (FY22: £159.5m) with growth across all product categories: Toilet tissue +40.2% to £163.0m (FY22: £116.3m), Kitchen towel +68.4% to £53.9m (FY22: £32.0m), Facial tissue +112.5% to £18.7m (FY22: £8.8m) and Wipes +140.0% to £4.8m (FY22: £2.0m). Sales volumes are +7.7% YOY vs. an overall flat tissue market, reflecting market share gains +200bps to 21.5% (FY22: 19.5%). Private label now represents 56% of the UK tissue market b

Hybridan Small Cap Feast - 12 Sep 23

12th September 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment ob

Hybridan Small Cap Feast - 25 Sep 23

25th September 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment ob

Reassuring outlook, with return to growth anticipated

FY23 results confirm an in line outturn, as well as reassuring on the outlook. Whilst the sales rate reduced over the summer months (0.43 in the 9 weeks to 1st Sep. vs. 0.54 in 2022), in line with peers, management anticipates a recovery during the autumn selling season. This is supported by a steadying mortgage market, its sales and marketing initiatives, and continued interest in multi-unit transactions. Gleeson Land started FY24 in a strong position with six consented sites and it has already

Portmeirion+ (PMP, House Stock, 293p) - No changes to profit forecasts after interims

Hybridan Small Cap Feast - 22 Sep 23

22th September 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment ob