Cenkos: Arena Events Group Plc -- Equity placing to fortify the balance sheet
Arena's planned £9.5m share placing will substantially strengthen its balance sheet and, together with various cost saving measures being undertaken, should help to see the company through the coronavirus crisis for the foreseeable future. Given the uncertainty around how long it will take before normal event scheduling resumes, we withdraw our forecasts and place our rating Under Review, which we will revisit once visibility improves.
27 Mar 20
Cenkos: Arena Events Group Plc -- Interim results
Despite the challenging market environment, Arena has delivered interim results that were broadly in line with our expectations (Adj EBITDA of £16.6m vs £17.0m forecasted). Cost saving initiatives are being implemented, which should support margins going forwards, whilst the company is expected to benefit from some significant contracts due for delivery in FY21E.
11 Feb 20
Small Cap Feast
AMRYT PHARMA PLC— a biopharmaceutical company focused on developing and delivering innovative new treatments to help improve the lives of patients with rare or orphan diseases have raised $60m before expenses and will relist on the AIM Market on the 25/09/2019. VAALCO Energy, Inc. (NYSE: EGY), an independent energy com pany focused on developm ent and production assets in West Africa, today announces its formal intention to seek a Standard Listing on the Main Market of London Stock Exchange ("LSE"), to complement its existing Listing on the New York Stock Exchange. Kaspi.kz, the largest Paym ents, Marketplace and Fintech Ecosystem in Kazakhstan w ith a leading m arket share in each of its key products and services, announces today the expected publication of a registration document that has been submitted for approval to the FCA and its potential intention, subject to market conditions, to undertake an initial public offering. Registration document approved for Helios Towers. The Group provides essential network services, flexible infrastructure solutions and reliable power supply to mobile network operators in five African growth economies. Revenue increased 7 per cent. year-on-year to US$191m (H1 2018: US$178m), with Adjusted EBITDA up 15 per cent. year-on-year at US$99m (H1 2018: US$86m) for the six months ended 30 June 2019.
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20 Sep 19
Cenkos: Arena Events Group Plc - H1/19A Interim Results
Arena's interim results showed strong revenue growth, driven primarily by acquisitions, along with modest LFL growth. We expect a strong performance in the Middle East to be offset by a more challenging environment in the UK and the US, leading us to revise our forecasts downwards.
10 Sep 19
Small Cap Feast
Essensys plc—a provider of mission-critical SaaS platforms and on-demand cloud services to the high growth flexible workspace industry, plans to join AIM. Offer TBC, expected 29 May 2019. Induction Healthcare Group plc—a healthcare technology company focused on streamlining the delivery of care by Healthcare Professionals looking to join AIM. Expected raise of £14.58m at 115p, market cap of £34.07m. Expected 22 May 2019. SDX Energy plc—a North Africa focused oil and gas company, announces its intention to complete a Canadian plan of arrangement under section 192 of the Canada Business Corporations Act and will have shares de-listed from the TSX-V and admitted to trading on AIM. Expected 28 May 2019, anticipated market cap of £76m Renold plc—a leading international supplier of industrial chains and related power transmission products, announced that it will cancel the listing of the Company from the premium segment and apply for admission on AIM. Expected 06 June 2019. Alumasc Group plc, the premium building products, systems and solutions group, has announced its intention to move from the Premium Segment of the main market to AIM. Expected market cap of £33.4m. Expected 25 June 2019
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15 May 19
Cenkos: Arena Events Group Plc - FY18A Results
One-off operational issues in the UK overshadowed an otherwise successful year, with Arena completing eight acquisitions, and recording strong organic growth across the group. We expect FY19E to be a year of consolidation, as issues in the UK are addressed and acquisitions fully integrated. FY20E looks very promising, boosted by several new and returning golf contracts. We consider the near halving of the share price over the past three months to be significantly overdone. Buy.
10 Apr 19
Small Cap Feast
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. Diaceutics, a data analytics and implementation services company which services the global pharmaceutical industry, is looking to join AIM late March, offer TBC.
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12 Mar 19
Cenkos: Arena Events Group Plc - FY18E Trading Update
Arena announced a trading update for the year ended 31 December 2018, which saw a strong performance in the US and Middle East offset by operational issues in the UK Structures & Scaffolding business. These appear to be the result of ‘overtrading' (revenue beat expectations, but costs incurred materially increased), leading us to lower our FY18E Adj EBITDA estimates. We see this as a one-off issue, which management is taking steps to address (new regional management team). Trading on a FY19E EV/Adj EBITDA of 6.9x, we continue to see significant value in the shares. Buy
17 Jan 19
Small Cap Feast
Circassia Pharma (CIR.L) - specialty pharmaceutical company focused on respiratory disease transferring from the Main Market. No funds being raised. Due 4 Feb. Greenfields Petroleum (TSX-V:GNF) production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.
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17 Jan 19
Cenkos: Arena Events Group Plc - Completion of TGP Acquisition
Arena has announced the successful completion of the TGP acquisition in Dubai, following the company's recent capital raise (Aug-18). In completing the deal, the terms were renegotiated to include the acquisition of TGP's office and warehouse property, as opposed to a sale-and-leaseback originally. The additional consideration for the property is £3.4m which will be paid in three equal amounts ending Jan-20. We upgrade our FY19E adjusted EBITDA by 2% due to the rental savings achieved. The growth prospects for Arena remain intact, with the stock now trading on a FY19E EV/Adj EBITDA of 6.1x. BUY.
31 Oct 18
Cenkos: Arena Events Group Plc - Delivering Eventful Performance
Arena has announced its H1/18A results with revenue growing 23% YoY to £54.9m and adjusted EBITDA expanding 52% YoY to £3.5m. We leave our trading forecasts unchanged. The company has successfully delivered on, and won new contracts while making six acquisitions since the beginning of the year. Management continue to successfully expand the business geographically and increase its product offering, which in turn leverages scale into heightened profitability. We believe Arena to potentially offer investors incrementally increasing returns on capital through margin enhancement and asset utilisation. The stock trades on an undemanding FY19E PER of 11.5x with the expectation of c28% YoY growth in adjusted EBITDA over the period.
19 Sep 18
Cenkos: Arena Events Group Plc - Successful Placing for Acquisitions
Arena Events Group plc has conditionally raised £20m via a placing, subject to shareholder approval, to facilitate making two material acquisitions, one in the West Coast USA and the other in the Middle East. Both acquisitions are expected to be earnings enhancing this year and in future years. We assess Arena to offer investors access to growth at an affordable valuation. We upgrade our forecasts and reiterate our Buy recommendation.
15 Aug 18
Cenkos: Arena Events Group Plc - In Line and Moving Forward
Arena Events Group has announced a H1/18A trading update with performance in line with expectations. The company has reached a settlement agreement with the US Attorney's Office (USAO) freeing it from the overhanging uncertainty, allowing the business to proceed forward. Management continues to remain focused on its successful strategy of smoothing seasonality, enhancing asset utilisation and cross-selling complementary services. We reiterate our Buy recommendation.
02 Aug 18
Small Cap Breakfast
Jadestone Energy (JSE.TO)—an independent oil and gas production and development company focused on the Asia-Pacific region. Pro-forma production of 13.9 mboe/d, 2P reserves of 45.3 MMboe, and a 2P NPV10 of US$563.7 million . Offer TBA. Current mkt cap C$135m. Due early August. Ovoca Gold (to be renamed Ovoca Bio PLC) - RTO of IVIX, a Russian company developing a drug candidate for the treatment of female sexual dysfunctions. No monies to be raised, market cap of £8.5m, due 30 July Kropz PLC-Intention to float by the emerging plant nutrient producer with an advanced stage phosphate mining project in South Africa and exploration assets in West Africa
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02 Aug 18
Cenkos: Arena Events Group Plc - Acquisition of Events Solution
Arena Events Group has announced the acquisition of Events Solution Ltd (Events) in the UK. The purchase consideration is £2.5m for a high margin business (c27% PBT margin) which adds a complementary offering to Arena, as well as introducing Arena to a new client base. We assess the acquisition to be consistent with management's strategy of building scale (geographical and product/service offerings) onto a niche global platform. We upgrade our numbers, particularly FY19E, and reiterate our Buy recommendation.
26 Jun 18
Small Cap Breakfast
GoTech Group– AIM shell moving to NEX. the Company’s Investment Strategy will be to initially effectively become a UK, Canadian and Australian-focused medicinal cannabis and related products’ index tracker and investor. Due 25 Jun. Sovereign Mines of Africa PLC to be renamed The Barkby Group PLC after the acquisition of Turf to Table Ltd will join the NEX Exchange on 26 June 2018 after raising £547k at 9p with market cap of £3.42m
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21 Jun 18
Small Cap Breakfast
Block Energy— UK based oil exploration and production company whose main country of operation is the Republic of Georgia. Raising £4m. Mkt cap £9.3m. Due early June. Codemasters Group— video game developer and publisher, specialising in high quality racing games. Offer TBA. Seeking £15m in primary. Due 1 June. Strongbow Exploration (TSX:SBW) intends to dual list on AIM. Holds rights to the South Crofty underground tin mine, a former producing tin mine located in the towns of Pool and Camborne, Cornwall . The project is estimated to require the Company to raise £25 million over the next 18 months to progress to a production decision. Offer TBS. Due June. Maestrano Group, a software company with operations in Australia (main country of operation), the UK, US and the UAE, is looking to join AIM. Offer TBC, expected late May. Yew Grove REIT—newly formed Company will pursue its investment objective by investing in a diversified portfolio of Irish commercial property. Offer TBA. Due Late May Team17 Group -video games label and creative partner for independent developers. 2017 revenues of £29.6m and Adjusted EBITDA of £12.9m. Raising £45.1m primary and £62.5m secondary at 165p. Mkt Cap £216.6m. Expected 23 May 2018 Serinus Energy -international upstream oil and gas exploration and production company. Its principal assets are located in Romania (development phase) and Tunisia (production phase). Raising c.£10m at 15p. Due 18 May. Mkt cap £32.6m
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21 May 18
Arena has announced FY17 earnings in line with expectations reporting 25% growth in EBITDA to £10.6m (3.5p EPS) and a proposed final DPS of 0.9p to bring the FY to 1.35p. Net debt at the period end was £11.5m. Trading in Q1 has been in line with expectations and the group has exchanged on a further bolt-on acquisition. We maintain our 2018E EBITDA forecast at £12.5m, although our EPS forecast increases slightly to 4.7p reflecting the net benefit of updated depreciation, interest and tax guidance. The group will invest in additional capex this year to drive EBITDA margin to >12% in the medium term. This leaves the stock trading on a 2018E P/E of 10.7x and an EV/EBITDA of 5.7x whilst yielding 3.8%. Combined with the organic growth profile and acquisition pipeline we reiterate our Buy recommendation.
11 Apr 18
Small Cap Breakfast
Fundamentum Supported Housing REIT. Raising £150m. Focussed on UK Social Housing assets. Due 2 May Vivo Energy—retailer and marketer of Shell-branded fuels and lubricants in Africa, Due in May. 100% secondary sell-down of existing Shares by Selling Shareholders, No new Money. Pricing TBA Gore Street Energy Storage Fund—Seeking to raise £100m for the purposes of investment in a diversified portfolio of utility scale energy storage projects. Due 12 April. Odyssean Investment Trust—Raising £100m at £1. Due 1 May. The Company will primarily invest in smaller company equities quoted on markets operated by the London Stock Exchange.
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11 Apr 18
A fine opportunity
Arena’s share price fell 22% on Thursday following its announcement that its US subsidiary, Arena Americas, is being investigated by the US Attorney’s Office (USAO) regarding its relationship with a previous customer who has been formally charged for a violation related to the Small Business set-aside programme. This could potentially lead to a fine of up to $8m (c£5.7m, or c5% of the group’s prior mkt cap), although we anticipate the fine to be low single digit $m. The group has no similar contracts so we see no contagion risk and we do not expect it to impact on either organic or acquisition opportunities in the US. We have also upgraded our forecasts for the GLD acquisition which increases 2018- 19E EBITDA by c2%. This leaves the stock trading on a 2018E P/E of 10.4x and an EV/EBITDA of 5.2x and yielding 3.8%. With the group reporting a strong start to 2018E and FY results next week we see the share price fall as a fine opportunity to increase exposure to the stock.
03 Apr 18
Small Cap Breakfast
Block Energy—a NEX Listed UK based oil exploration and production company whose main country of operation is the Republic of Georgia, looks to join AIM end of February 2018. Offer TBC | OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Offer raising £30m at 165p with mkt cap of £100m . Due 9 Feb.
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02 Feb 18
Arena has announced an in-line trading update for the period since its interim results to the December year end. Q4 has been particularly busy with the group delivering significant projects in the UK, Asia and the US. During the second half the group has increased its capital spend to support new business wins and increase profitability in the current year. As such net debt is higher than anticipated at c£11.5m. The corollary of this spend is an increase in our 2018 EBITDA forecast to £12.2m. This leaves the group trading on a 2018E EV/EBITDA of 6.4x which is inexpensive given the forecast c15% growth. The market should respond positively to this announcement and we strongly reiterate our Buy recommendation.
26 Jan 18
Small Cap Breakfast
Hydrominer GmbH, An Austrian cryptocurrency miner, is considering an initial public offering (IPO) on the London Stock Exchange AIM during 2018 according to an article on Bloomberg. Block Energy—a NEX Listed UK based oil exploration and production company whose main country of operation is the Republic of Georgia, looks to join AIM end of February 2018. Offer TBC OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Offer raising £30 at 165p with market cap of £100m
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26 Jan 18
Solid H1s and maiden dividend
Arena has reported 15% growth in revenue to £51.1m and a 100% increase in underlying EBIT to £0.8m. Strong improvement in working capital led to a 164% increase in cash generated from operations at £7.4m. The group has declared a maiden dividend of 0.45p per share. Net debt post IPO has reduced to £10.5m. Since the period end the group has secured a three-year contract with ITV for ‘Dancing on Ice’ and a two-year contract for the CJ golf trophy in South Korea. Trading is in line with expectations and the group remains confident of meeting market expectations (£10.6m EBITDA) for the full year. The stock trades on a 2018E EV/EBITDA of just 5.9x and yields 3.0%. With earnings being driven from organic growth (H1: 6.7%) and potential acquisition opportunities from a strengthened balance sheet position, we see scope for significant share price appreciation, Buy.
25 Sep 17
Arena Events Group (‘Arena’) is a leading provider of turn-key, managed solutions for event organisers with predominantly recurring revenues from an enviable footprint of Tier 1 clients arranging sporting, cultural and corporate events. With a highly experienced management team and exceptional client list the group is well placed to deliver robust organic growth with the potential to further consolidate the industry through acquisitions. We forecast c7% three-year CAGR in revenue and c14% three-year CAGR in EBITDA prior to any acquisitions. The stock trades on a 2017E P/E of 16.4x and an EV/EBITDA of 6.8x with a 2.5% yield. We see fair value of up to 99p per share and initiate coverage with a Buy recommendation.
30 Aug 17