Hybridan Small Cap Feast - 22 Nov 23

22nd November 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 obj

Morning Note – 22 November 2023

H1'24 results give comfort

Duke Royalty - In Royal Health

Duke has released its H1/24A interim results for the period ending 30th September 2023 that are in-line with expectations. Recurring cash revenues increased 17% to £12.2m, whilst total cash revenues increased 35% to £14.1m. The portfolio continues to be resilient despite macroeconomic headwinds, and c£18m of capital was deployed across new and existing investments. We iterate a 1-year price target of 45p based on a target FCF yield of 8%.

Cenkos: Duke Royalty Ltd -- Transparently Good New Partner

Duke has announced an $11.5m royalty investment plus c10% minority equity stake in a new partner called Glasshouse Products as part of a management buyout to return the business to being a founding family-led one. The investment will have terms in-line with Duke's existing investments and diversify the current portfolio to 15 partners. The deployment looks attractive to us and demonstrates the large opportunity pipeline we have highlighted previously. We leave forecasts unchanged given we alread

Cenkos: Duke Royalty Ltd -- Regal Record Revenues

Duke has released its annual results for the period ending 31 March 2023. Total cash revenues increased 19% to a record high of £21.9m, whilst recurring cash revenue per share increased 30% to 3.3p. As a result of the Instor buyout premium and faster capital deployment due to a strong pipeline, we have upgraded FY24E revenue by 9% to £28.2m and FCF p/s by 9% to 3.8p. We release FY25E forecasts which show a 14% increase in recurring cash revenues to £30.1m whilst recurring FCF p/s increases from

FY23 results demonstrate resilience

FLASH: In-line trading update

Cenkos: Duke Royalty Ltd -- Record revenues and more to come

Duke has released a Q1/24E trading update which points to a continuation of steady growth in recurring cash revenues and resilient underlying portfolio companies. Guidance for the quarter is for £6m of recurring cash revenues, and total cash revenues are expected to be c£7.5m once the buyout premium from Instor is accounted for. Duke's valuation looks very compelling at current levels with the FY24E dividend yield over 10% whilst being backed by FCF generation.

Hybridan Small Cap Feast - 07 Mar 23

7 March 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 objective

Cenkos: Duke Royalty Ltd -- New Partner in Store for Duke

This morning, Duke announced its newest royalty partner as Instor Solutions, which is a data centre infrastructure installation business based in California. The $8.75m investment will facilitate a management buyout of the majority shareholders of the business. This financing will have terms in-line with Duke's existing investments and diversify the current portfolio to 15 partners. We leave forecasts unchanged as we already forecast a level of capital deployment throughout the year. Duke's valu

Cenkos: Duke Royalty Ltd -- Positive Q4 Update and Guidance

Duke has released a positive Q4/23E trading update in-line with our expectations. With the latest guided quarterly recurring cash revenues of £5.7m, the total for FY23E would be £21.7m, exactly in-line with our forecasts and demonstrating the reliability of forecast cash flows. Further deployments took place during the quarter which will continue to support further revenue growth in FY24E. Duke's valuation looks very compelling at current levels with the FY24E dividend yield at c9% whilst being

FLASH: Refinance and upsize of credit facility

Cenkos: Duke Royalty Ltd -- A New Half and a New Path

Duke has released a resilient set of interim results and a Q3/23E trading update and remains on track to hit our full-year estimates. H1/23A recurring cash revenues were up 67% YoY, and Q3/23E should see a further 4% increase. The Group has a further c£15m of liquidity to deploy following the equity raise earlier this year and the recent investment in a new partner called New Path Fire and Security. We believe deployment will be higher in the second half than the first. The business model contin

In-line H1'23 results; well positioned

LIBERUM: PayPoint: Growth is not priced in

DSW Capital+ (DSW, House Stock at 51p) - H1 results –promising outlook

Octopus Renewables Infrastructure

ORIT: renewables diversified across stage, technology, and geography…

A tough year, but clear fundamental value

AUM closed FY23 (30 Sep 23) on £37.4bn, 5% up y-o-y. Net flows were slightly negative (-£92m or -0.3% of opening AUM), with investment performance adding £1.8bn. It’s been a tough year for asset managers, but in a London-listed peer group, Impax recorded the second-strongest net flow rate (median -7%, see note). Some experienced heavy (double-digit) net outflows. A profit fall was due to adjusted operating costs increasing faster than revenue, by 11% from £108.0m to £120.3m. Part of this increas

Lifesafe (LIFS) - Strong growth but downgrades nonetheless as we await industrial fluid

LIFS' announcement this morning discloses strong revenue growth, with sales in the first eleven months up 62%, highlighting the attractiveness of their innovative fire products. These have made them leaders on Amazon both in the UK and in the substantial US market, where they were successfully launched early last year. However, disappointing sales from one partner, combined with enhanced competition, have caused a pull-back in sales forecasts combined with increased losses in the current year; a

H1'24 results: strength of the model evident

Morning Note – 30 November 2023

Around the World in Eight Ideas - Investment Trust Opportunities Beyond the UK

Although the UK now represents a paltry 3.5-4.0% of global equity indices, home bias in the domestic stock market is estimated at c 25% across institutional and retail investors. This persists across asset classes: in the Investment Association universe of open-ended funds, 28.1% of total AUM at the end of September 2023 was invested in UK sectors. This leaves a significant amount of investors' assets exposed to overseas markets that may be unfamiliar and harder to access. In such a situation, t

Vanquis Banking Group+ (VANQ, House Stock at 112p) - Adding flesh to the bones

LIBERUM: DF Capital: Taking a prudent view on the refinancing of the major dealer

Hardman & Co Insight: Higher interest rates overshadow IIC/REIF prospects

Hardman & Co Research’s focus is on the nine quoted infrastructure investment companies (IICs) and on the 22 renewable energy infrastructure funds (REIFs), most of which saw their share prices fall during 2022, while the FTSE 100 rose by just 0.9%. In our Quoted UK Infrastructure and Renewable Energy – Prospects for 2023 publication, we have addressed the three key issues of recent months: higher inflation, extremely volatile power prices and rising interest rates.

Agronomics - A unique offering in a rapidly developing sector

Agronomics (ANIC) invests in cellular agriculture companies. Since mid-2022 it has placed increasing emphasis on companies using precision fermentation technology or providing contract precision fermentation services, as these appear to have greater near-term commercial potential than cultivated meat and seafood. Agronomics’ NAV has risen almost 100% since the inception of the current strategy in April 2019, and looks set to increase further as the company’s portfolio holdings receive regulatory

Delivering growth in uncertain markets

Positive interims from Vp this morning highlight another period of growth despite the mixed market backdrop. The results again illustrate the benefit of Vp’s diverse mix of specialist activities, with the quality of earnings confirmed by further growth in operating margin (now 13.9%) and ROCE (14.7%). Strategic priorities include continued progress with ESG initiatives and a greater emphasis on Digital, with more on this likely to follow later in the year. We maintain our Fair Value estimate o

Picton Property Income - Resilient H124 with fully covered DPS

In a challenging market environment, Picton Property Income (PCTN) produced a resilient H124 financial performance, supporting fully covered DPS. This was underpinned by continued portfolio outperformance of the MSCI UK Quarterly Property Index, building on a long-term track record of upper quartile performance since inception. Rents continued to grow, asset management initiatives are in place, aimed at capturing reversionary income potential, and borrowings are mostly long term and fixed rate.

Critical Metals plc releases its Final Results

Key Points CRTM reported a loss of £2.7M for the 12 months ending 30 June 2023. Increased indirect ownership of the Molulu project from 40% to 70%, streamlining the corporate structure. Commenced copper ore production at Molulu in January 2023. In October 2023, the Company announced that it had entered into an off-take agreement with O.M Metal & Resources S.A.R.L, for a minimum of 20,000 tonnes of copper oxide ore. Raised £600,000 at a price of 25p per share and raised a further £1.3M at 25p per