N+1 Singer - Morning Song 02-08-2016

A G Barr (BAG LN) Weak H1 update. We move to Sell | BBA Aviation (BBA LN) Signature outperforming; ERO still challenging | Dialight (DIA LN) Sales decline and high non u/l costs, but strong cash-flow | Elementis (ELM LN) Challenging H1, well positioned for future recovery | Greggs (GRG LN) A successful first half and a reassuring start to H2 | RhythmOne (RTHM LN) Another positive step | SDL (SDL LN) Building confidence in strategy execution | Spirent Communications (SPT LN) Headwinds mask underl

Solid start to a transformational year

As we said in March, this promises to be a big year and, on balance, we continue to feel that a group intently focused on business and general aviation will ultimately be a more valuable one. Trading is in line with expectations and the integration of Landmark is progressing as planned. Landmark integration and debt reduction remain the keys in FY16 and we await further information on the future of ASIG. We remain at Hold.

Amended forecasts; important year ahead

During FY16 BBA will integrate the transformational acquisition of Landmark, look to restructure ERO, work to reduce debt levels and also hope that the US economy remains positive enough to help bizjet activity. It promises to be a big year and, on balance, we continue to feel that a group intently focused on business and general aviation will ultimately be a more valuable one. We have prudently reduced forecasts (see below) but nudge up our target price to 204p (14x FY16 EPS) reflecting underly

Morning Song

BBA Aviation (BBA LN) Amended forecasts; important year ahead | Craneware (CRW LN) In line interims. Value cycle gaining momentum? | Dialight (DIA LN) Underlying EBIT and EPS in line but non-underlying costs continue | Eckoh (ECK LN) New 5-yr contract with Ideal Shopping Direct | Gresham Computing (GHT LN) CTC-led strategy provides LT platform for growth | John Menzies (MNZS LN) Tough year for aviation; structure being evaluated | St Ives (SIV LN) Interims – 16% organic growth from strategic m

Results in line; ASIG sale being reviewed

The Group is to be transformed by the acquisition of Landmark which will cement the FBO business as the key driver of profitability within the Group. It would not surprise us to see future disposals from the other business areas, perhaps eventually delivering a 100% FBO focused Group, and the first sign of that is given today with a comment that approaches have been made for ASIG. Landmark integration and debt reduction are key in FY16, we await the analyst presentation but expect to remain at H

Signature solid; ERO subdued

As we said last week, we expected Aftermarket to be subdued following recent peer updates, but see a positive medium term future for the transformed Group assuming that US bizjet traffic remains robust. We expect to make little change to our numbers and remain at Hold.

Morning Song

BBA Aviation (BBA LN) Signature solid; ERO subdued | Ground Rents Income Fund (GRIO LN) Revaluations drive NAV higher | Sigma Capital Group (SGM LN) Gatehouse Phase 2 begins: 900 new PRS homes | Sinclair IS Pharma (SPH LN) Rejuvenated growth | Vectura Group (VEC LN) Phase III start for triple therapy programme QVM149

Reshaped Group; Aftermarket Caution

The Group is to be transformed by the acquisition of Landmark which will cement the FBO business as the key driver of profitability within the Group. It would not surprise us to see future disposals from the other business areas, perhaps eventually delivering a 100% FBO focused Group. In the short term, we expect Aftermarket to be subdued following recent peer updates, but see a positive medium term future for the Group assuming that US bizjet traffic remains robust. As the acquisition process e

Morning Song

AMINO TECHNOLOGIES (AMO LN) Trading update reassures | BARR(A.G.) (BAG LN) Q3 in-line but trading environment remains tough | BBA AVIATION PLC Reshaped Group; Aftermarket Caution | CONSORT MEDICAL PLC (CSRT LN) Interims on track | SUMMIT THERAPEUTICS PLC (SUMM LN) First research milestone achieved in strategic alliance | WYG PLC (WYG LN)Interims in line, substantial growth in order book

Landmark deal

The $2,065m purchase of Landmark Aviation is a transformational deal for BBA Aviation, extending its leadership in the global airport fixed-base operation (FBO) market, especially in the US. The clear focus on the Flight Support business confirms the future strategic direction at BBA’s core. While near-term debt metrics are stretched (despite the rights issue), the acquisition potentially unlocks BBA as a growth vehicle via both enhanced organic development and longer-term deals around the world

Mixed H1

The US bizjet market continues to improve slowly but Aftermarket has had a disappointing H1. Underlying PBT was 42% of our full year forecast but we expect Aftermarket to improve in H2. We await the presentation but anticipate reducing our forecasts by up to 5% and expect to retain our Hold recommendation.

Morning Song

ATTRAQT Group (ATQT LN) First technology partnership should open up opportunities | BBA Aviation (BBA LN) Mixed H1 | Latchways (LTC LN) Full year expectations unchanged | Lookers (LOOK LN) Preview – buy Lookers ahead of interims on 12 August | Restore (RST LN) Small bolt-on acquisition | Sinclair IS Pharma (SPH LN) Full year trading update | Synairgen (SNG LN) Research collaboration with Pharmaxis | Tetragon Financial Group Ltd (TFG NA) Taking volatility in its stride

Supreme (SUP LN) - Record performance, EBITDA ~doubled

Supreme’s FY24 trading update confirms a record performance in the 12 months to 31 March 2024. Organic revenue and profit growth across all four divisions has driven Group revenue +45% YOY to £225m, with FY24 adj. EBITDA almost doubling to ‘at least £38m’, driving record levels of cash generation. Supreme is actively exploring complementary M&A, supported by a debt free balance sheet. Trading on an undemanding FY25 PE of just 6.7x, with a 3.4% yield, we believe downside risks are more than price

Morning Note – 22 April 2024

Supreme+ (SUP, House Stock at 125p) - Supreme, Supreme!

Morning Note – 25 April 2024

Vianet Group: FY24 trading update, strategic contract win

Vianet has published a positive trading update for FY24 with turnover up 7.6% to £15.18m, a 3.5 percentage point increase in gross margin YoY, and adjusted EBITA ahead of market expectations. Net debt continues to fall and closed FY24 at £1.52m (£2.1m at 30 September 2023), demonstrating strong free cash flow generation, even without the benefit of the £0.9m tax receipt received in 1H24, which augers well for a final dividend. The company reported a new contract with Wilcomatic Wash Systems, the

SP Angel Spec Sits: FY Trading Update (LTHM)

Vianet - FY24 ahead, strategic forecourt customer win

Vianet’s FY24 trading update shows FY24 revenue +1% ahead of our previous forecast, adjusted EBITA +2% ahead, EFCF and net debt +£0.6m ahead, and a strategic new customer win with prominent forecourt operator Wilcomatic. A robust FY25 pipeline and outlook leads us to reiterate our FY25E forecasts at this point, with the update highlighting: strong progress renewing and winning new customers on 3-5 year contracts as they migrate from 3G to Vianet’s advanced 4G LTE solutions; the successful integr

Headlam Group - Strategy for growth in tougher market

Headlam Group has laid out an ambitious long-term revenue target of between £900m and £1bn, as it seeks to grow its share of the UK floor coverings distributor market. Despite a challenging backdrop due to the low level of residential housing transactions, management is seeking to expand each of its sales channels: Trade Counters, Larger Customers, Regional Distribution and Europe & Other. The FY23 results reflected the more challenging environment and the group trades at a discount to its long-

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

Norcros (NXR LN) - Sale of Johnson Tiles UK streamlines the business and improves operating margin

Norcros has announced the sale of its Johnson Tiles UK business to the current management team for a consideration of £1.0m, with a further modest earnout based on the equity value of the business, both payable in April 2028.

Renewi - Solid trading and better cash generation

Renewi’s FY24 trading update was in line with management’s expectations and its improved cash generation is reassuring for investors. Attention is now likely to turn the strategic review of the UK Municipals with management stating that they remain on track to update markets by the end of June. This could lead to an exit of key liabilities and leave Renewi as an attractive circular economy investment with strong market positions and organic growth plans, which should assist in generating value,

SP Angel Morning View: Copper prices hit $9,700/t as China smelts concentrates for zero charge Tc/Rc

Hybridan Small Cap Feast - 24 April 24

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