McBride - Improving backdrop with cautious optimism

McBride has witnessed improving momentum in its business during H123, with the company returning to positive adjusted operating profit during the last two months of the period. This trajectory has continued into the start of H2 and is coupled with some early signs of stabilisation in certain input costs and higher volumes from new business wins. The current retail environment is favourable as cost-conscious consumers turn to private-label products, and McBride has gained share of this segment. T

McBride - Resetting the business

McBride has delivered a good performance over H121, with higher revenues and improved gross margins. Input costs have started to increase, but the board’s expectations for the full year are unchanged. The company gave an update on its new strategy, Programme Compass, and as previously announced, the business has been reorganised into product divisions to sharpen focus, improve execution and increase speed to market. McBride has been through several strategy resets over the years and time will te

McBride - Another reboot

McBride has delivered a mixed FY20 performance, with a weaker H1 and a bounce back in H2 as a result of increased demand due to COVID-19. A strategy review has been undertaken, and the company will be reorganised into separately managed product divisions. Time will tell if this will successfully address McBride’s long-term challenges, but the new CEO has a thorough knowledge of the business, and we await further details, which are due to be announced in February.

McBride - Awaiting the new strategy

McBride’s H1 results revealed a mixed picture by geography. Household revenues were down 1.4% at constant currency and group revenues were down 4.4%. Adjusted operating profit was down c 30%, and there was a marked slowdown in the business during November and December. However, January saw an improvement. FY guidance has been maintained, implying a better H2 helped by easier comps and a relatively benign raw material outlook, although we note that distribution costs were higher during H1, and ma

McBride - Tough environment easing slightly

Despite the challenges encountered during FY18, McBride delivered underlying revenue growth of 3.7% excluding aerosols. Raw material and labour cost increases hampered profit and margin progression, but the inflationary trends have started to stabilise, so there should be less pressure during FY20. The ‘Prepare’ phase of the strategy has been reinvigorated, such that management’s expectation for FY20 remains of flat revenues and earnings slightly below FY19.

Where’s the Value?

Warren Buffett once said that as an investor, it is wise to be ‘fearful when others are greedy and greedy when others are fearful’. Fear is not in short supply right now.

Small Cap Feast

United Oil & Gas (UOG.L) an oil and gas exploration and development company brought to the Official List (Standard Segment) in July 2017 by way of a reverse takeover of Senterra Energy plc. No capital to be raised, expected market cap of £17m and expected 28 Feb Techniplas –global producer and support services company providing highly engineered and technically complex components, making the supply chain to original equipment manufacturers more efficient. FYDec17 rev $515m. Polemos, to be rename

Repairs complete

McBride has completed its Repair phase of the turnaround programme and has commenced the Prepare phase. The business is performing in line with what management had set out at the start of the programme, and overall progress demonstrates that McBride is indeed now more focused on the bottom line, as key financial ratios are improving. The acquisition of Danlind for £39m, announced earlier this week, demonstrates that execution of the Prepare phase is already well underway.

Preparing for growth

McBride is halfway through its restructuring plan, having completed the Repair phase, and is now implementing the Prepare part. This should set McBride up for more sustainable and profitable growth. What sets this programme apart from previous attempts is management’s absolute focus on tight cost control and business simplification. This should avoid increased overheads and complexity creeping back into the system as the business starts to grow again.

Turnaround under way

McBride’s restructuring programme is under way and starting to deliver major benefits. The business is being streamlined and the reduction in complexity is significantly lowering cost, improving reliability and hence the ability and scope to serve the more profitable customers. Once this is complete, the group will operate at a lower cost and with far fewer constraints, thus presenting material savings, and with the potential to build further growth in the medium term.

AFC Energy (AFC LN) - First modular ammonia cracker system

AFC has unveiled a groundbreaking modular ammonia cracker system demonstrating viable and scaleable production of hydrogen in the UK using this method. The cracker system is designed to deliver 140 tonnes of fuel cell grade hydrogen each year. Hydrogen from the plant will initially be targeted for sale into AFC’s UK H-Power Generator deployments, including those with Speedy Hydrogen Solutions. Along with the recent purchase of the mobile storage and distribution assets of Octopus Hydrogen, AFC c

Spectra Systems - Today's deal powers polymer banknotes and provides a big earnings lift

This morning's announcement that SPSY is to acquire Cartor Holdings provides the company with significant new firepower as it embarks on lucrative central bank currency bids with its powerful and innovative polymer banknote technology. Cartor is a global market leader in security printing with manufacturing sites in the UK and France, supplying a range of printed security products which are highly complementary with SPSY's core portfolio, and offering significantly enhanced capabilities in rela

CAP-XX - Tax rebate received and JV signed

CAP-XX has announced the Australian Taxation Office has approved the FY23 R&D grant and associated rebate of A$2.1m. The net proceeds of A$1.0m, after repaying the principal and interest associated with the revolving line of credit drawdown, were received by CAP-XX last week.

Solid State - Strong interim results – trading in line with FY24 expectations

The group delivered a strong set of interims, boosted by a full contribution from Custom Power (CP) and its large military contract delivery. Organic growth was over 35%, with an improvement in underlying margins, albeit with the margin mix diluted by the military contract delivered. As flagged, H1 order intake saw some customer destocking, although there may be some early signs this could be abating. Even so trading remains resilient. The outlook points to trading in line with recently upgraded

Gooch & Housego - FY23 results in-line with expectations, better cash flow

FY23 results are in-line with expectations, showing growth from strong underlying demand, coupled with improved operational delivery. Growth was seen in all three divisions. Trading is in-line with the recent upgraded FY24 forecasts. Prospects are underwritten by a strong order book and boosted by the recent acquisitions of Artemis and GS Optics, albeit with some customer destocking by certain industrial customers, offset by robust demand in growth areas. Self-help measures and the new CEO’s str

Morning Note – 5 December 2023

Solid State - nterim results illustrate a strong trading performance; on track for the full year

Solid State is a specialist value added component supplier and design-in manufacturer of computing, power and communications products. This morning, the group has released interim results to 30 September 2023, illustrating strong growth at both the revenue and PBT levels, with the Board reaffirming confidence in meeting full year expectations. H1 2024 revenue increased by 48% to £88.1m, driven in part by a £23.4m contribution from specific contracts within defence and security, with adjusted PBT

Initial Equity Trading Comments - 1 December 2023

LIBERUM: Superdry*: Progress in resetting the business; tough year ahead

Hybridan Small Cap Feast - 05 Dec 23

5th December 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 obje

PROGRESSIVE: IG Design Group: Strong profit growth, key strategy initiatives and quantified aspirations

IG Design Group delivered a 27% increase in adjusted PBT to $34.8m for H1 FY24 (to 30 September) with a significant reduction in net debt to $15.1m, as signposted in last month’s trading update. The adjusted operating profit margin was some 270bps higher at 8.6% (vs 5.9% in H1 FY23), the highest achieved since H1 FY20 ahead of the CSS acquisition. Management has provided more details on the key attributes and initiatives for its new growth-focused strategy. The group is on track to return to pre

The Joy of Techs - Cavendish Technology quarterly sector note

£23.3bn in enterprise value has been returned to AIM technology shareholders over the past six years in the form of 51 public to private takeouts, including 10 in 2023 alone with the takeovers of Smoove* and Tribal announced in early October. With UK valuations appearing cheap and looking more attractive to potential acquirers, we take a moment to reflect on the trends of corporate and private equity bidders targeting AIM-listed technology companies going back to 2017, through the uncertainties

Games Workshop Group - Leviathan

Games Workshop Group (GAW) enjoyed another record year of revenue and profit growth in FY23 despite the more challenging macroeconomic backdrop and economy-wide cost pressures. Underlying volume growth is testimony to the appeal of the IP to its hobbyists. GAW entered FY24 with strong revenue momentum, implying that the June 2023 release of Leviathan, the 10th edition of its most significant property, Warhammer 40K, has boosted growth in Q124. Easing cost pressures should be supportive of underl

Hybridan Small Cap Feast - 4 Dec 2023

4th December 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 obje