What’s cooking in the IPO kitchen?
Guild Esports a UK-based owner and developer of esports teams, has announced its intention to seek a listing of its ordinary shares to the Standard Listing segment of the London Stock Exchange this autumn. its founding shareholders include David Beckham, former football player and captain of England, and now co-owner of new MLS team Inter Miami CF.
HOME REIT intends to float to the Main Market raising up to £250m. The Company will seek to contribute to the alleviation of homelessness in the UK, whilst targeting inflation-protected income and capital returns, by investing in a diversified portfolio of assets across the UK which will be dedicated to providing accommodation to the homeless. Due Mid October
S-VENTURES - The Company will look to identify investment opportunities in the wellness sector within the UK and Europe. Due 16 Sep on the Aquis Exchange.
Sativa Wellness Group—(Canadian Securities Exchange: STIL) renamed from Stillcanna Inc following the conditional acquisition of Sativa Group (AQSE:SATI) to list on the AQUIS Exchange. A fully integrated European seed to consumer CBD group with the pricing, products, and stability to meet the CBD market demand in the medium term. With world-class extraction and formulation experts, an agricultural team that has over 20 years’ experience farming hemp, along with laboratory testing capabilities, the group has established itself globally as a trusted source of high-grade, premium wholesale CBD brands and products.
Umuthi Healthcare Solutions Plc, the technology led healthcare business focused on the distribution of pharmaceuticals and the provision of medical facilities in remote areas, seeking admission to the Standard Listing segment of the Official List
The Hut Group. Expected intention to float on the Main Market. THG is a vertically integrated digital-first consumer brands group, retailing its own brands in beauty and nutrition plus third party brands, via its proprietary technology platform to an online and global customer base. For the year ended 31 December 2019, THG's revenue was £1.1 billion, up 24.5 per cent. year-on-year, and its Adjusted EBITDA was £111.3 million, representing an Adjusted EBITDA margin of 9.8 per cent . The Company has experienced an acceleration in growth during 2020, with revenue of £676 million, up 35.8 per cent. on the equivalent prior year period , achieved in the 6 months to 30 June 2020, which the Directors believe evidenced the non-discretionary nature of the nutrition and beauty categories .
Kibo Energy PLC, the multi-asset Africa focused energy company, is seeking admission for its 100% owned UK subsidiary Sloane Developments Ltd , which will be renamed Mast Energy Developments PLC (MED), to the Standard List of the London Stock Exchange plc . Targeted for Q4 2020. The MED business strategy is to acquire and develop a portfolio of flexible small-scale power generation assets, exploiting a growth niche market in the UK for Reserve Power generation to balance out the national grid at critical times.
Companies: MIRI VAST VCP AEO GFIN DX/ BREE CIN LOOP PALM
Aeorema delivered an impressive set of interim results for the 6m period ended 31 December 2019. Revenues were 46% ahead of the previous year and the balance sheet ended the period with a healthy net cash position of £1.39m. The results were followed by a small but strategic acquisition. However, COVID-19 has led to events being postponed and hence a detrimental impact on forecast revenues. The Company expects a loss before tax for FY20 of between £150k and £250k against our prior forecast of a profit of £388k. Until we have greater clarity, we are withdrawing our market forecasts.
Companies: Aeorema Communications Plc
Once again Aeorema has delivered an impressive set of financial results. For the 12m period ended June 2019 the Company reported an increase in revenue and EBIT of 40% and 29% respectively. The net cash position at year end reached a new high of £2.2m which equates to over 90% of the current market capitalisation, or equivalent to c. 24.5p per share. The healthy cash position has enabled a 1.0p dividend to be declared, a 33% uplift on the 2018 figure. Reassuringly the Company remains confident of future growth with recent client wins expected to boost the current year’s earnings. We have increased our 2020 revenue forecasts by 31% and our 2020 EBIT forecast by 21%.
Voyager AIR The Company will focus on the acquisition, leasing and management of primarily widebody aircraft, with asset management services to be provided by Amedeo Limited the IPO will comprise a Placing and Offer for Subscription of Shares to raise up to approximately US$200m. Roxi Music UK music streaming service plans London IPO as it goes up against Spotify. They have appointed investment bank Arden Partners for an initial public offering (IPO) on the London Stock Exchange later this year. Freyherr International Group PLC the Medicinal Cannabis holding company established in 2016, is planning to list on the NEX exchange on the 30th July
Companies: SIM EYE FOX SDI KETL AEO YNGA SGZ OCI KDR
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
Companies: SAR MYSL SEE BLV LID IND ERGO DDDD AEO
Aeorema has delivered a steady set of interims for the seasonally weaker first six months of its financial year. In the six-month period to the end of December 2018, revenues increased 7% on the prior year period. Although the Company reported an operating loss of £142k in the first six months of the year, against an £81k profit in the prior year period, management attributes this to the cost of recent senior hires (and associated recruitment costs) but remains confident that full year market expectations will still be met. To achieve our full year forecasts of EBIT of £309k the Company needs a strong second half of the year which should be achievable given most corporate events take place in the summer and the Company will be benefiting from the newly strengthened team. We leave our forecasts unchanged and note that net cash balances remained heathy at the end of December at £1.04m, equating to over 11p per share.
Aeorema has delivered a solid set of results for the 12m period ended June 2018 with revenue and underlying pre-tax profit growth of 16% and 16.5% respectively. We view the results as particularly reassuring given that this was the first 12m period with the new management team at the helm, confirming that the business was not reliant on the June 2017 departed founders. Net cash at the end of June was £1.44m which equates to over 60% of the current market capitalisation, or equivalent to c. 16p per share. A 0.75p dividend has been announced which is a 50% uplift on the 2017 figure.
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
Wentworth Resources— oil and gas exploration and production company, with assets in the onshore Rovuma Basin of East Africa. Introduction only. Mkt Cap c £50m . Due today
Finncap—proposed acquisition of M&A adviser Cavendish Corporate Finance and AIM admission. Offer TBA
Kropz PLC—an emerging plant nutrient producer with an advanced stage phosphate mining project in South Africa, a phosphate project in the Republic of Congo and exploration assets in Ghana. Looking to join AIM, offer TBC, market cap TBC. Due Late October.
Crossword Cybersecurity PLC* (NEX:CCS)—the technology commercialisation company focusing exclusively on the cyber security sector is exploring its options in relation to a potential move to the AIM market of the London Stock Exchange which, if it were to proceed, would likely take place over the next few months.
The Panoply parent company of a digitally native technology services group founded in 2016 with the aim of identifying and acquiring best-of-breed specialist information technology and innovation consulting businesses across Europe, is looking to join AIM. Offer TBC, expected late November 2018.
Companies: EAH 88E BOD SPO BMK BOTB AEO IME TYMN IKA
Jackpotjoy — Prospectus now approved by the FCA. Admission to Official List expected 25 January.
Eco (Atlantic) Oil & Gas—TSX-V listed oil and gas exploration has announced its intention to float on AIM. Assets in Guyana and Namibia. Proposed £2m-£3m fundraise.
Diversified Gas & Oil—According to LSE website first day of trading on AIM now expected for 30 January.
Companies: EEQP APH GAMA FLO LWRF BLV AUG SFE AEO
Research Tree provides access to ongoing research coverage, media content and regulatory news on Aeorema Communications Plc.
We currently have 9 research reports from 2
The MISSION’s H120 results were as indicated at the trading update, with headline pre-tax loss of £2.2m. H220 looks stronger, with new clients and new business and the continuing benefit of a broad agency portfolio across verticals. It is adding central resource to service group agencies efficiently, setting up a digital production studio and using recently acquired Innovationbubble for behavioural consultancy. Careful cash management reduced net debt to £0.9m at end June, with annualised cost savings of £0.7m targeted. Our unchanged PBT and EPS forecasts leave the shares trading below peers.
Companies: The Mission Group Plc
Kape’s interims saw Group revenues rise +97% y/y to $59.0m (organic: +12%), driven by a 245% increase in Digital Privacy sales (+47% organic). Organic growth was stronger than anticipated in Digital Privacy, above N1Se estimates of 30%-40% as a function of strong end-user demand. CyberGhost (VPN) and Intego (end-point protection) subscriber bases grew +10% and +11% h/h respectively. The main takeaway is Kape’s inflection to positive FCF ($6.7m; H1’19: -$1.8m) alongside increased cash investment into customer acquisition (+60% y/y to $29m). We see meaningful cash flow margins (>25%) being delivered in the next 1-2 years, with £31m of FCF forecast for FY’21E generating a 6.3% FCF yield (peers offer 3.5%-4%). Putting Kape on a 4% FCF yield implies an intrinsic value of >£3/share.
Companies: Kape Technologies Plc
Kape has enjoyed a good first half of 2020 both in terms of operational progress and financial performance. Revenues increased 97% to $59.0 million (H1 2019: $29.9 million), a 12% increase on a pro-forma basis. The interim results reflect the Group’s continuing success in integrating its Private Internet Access (PIA) acquisition while growing subscriber numbers – now just shy of 2.4m in total - across the businesses. The focus on customer lifetime value is evident in the marketing spend and investment in new product development. Kape remains on track to meet previous guidance for the full year and expects to deliver synergies from the PIA deal at the top end of the mooted range. We believe that the Group has good revenue visibility and it continues to maintain a high level of user retention at 80%. We make no changes to estimates other than to reflect a higher amortisation charge. In our view, the interim results show that Kape continues to display the drive and capacity to meet the growing needs of consumers for digital privacy and security products in a rapidly evolving marketplace.
De La Rue remains challenged. New management has to navigate a difficult Currency market and consequent concern over its finances. The swift response in terms of a turnaround programme is a positive start, accelerating cost cutting initiatives and cash management measures, including suspension of the dividend. Restoring stability and rebuilding confidence in the investment case is likely to take some time.
Companies: De La Rue Plc
Trading update: on track; Reiterate Buy rating
Total advertising revenue dropped by 43% in Q2 20 and ITV Studios was affected by the stop in production. The adjusted EBITA margin collapsed to 14% of revenue (-8pts yoy) despite the reduction in the cost of programmes by £77m and overheads cost savings of £51m over £60m targeted in 2020. There is no guidance for Q3 20 and FY2020. The negative trend in advertising was reduced in July 2020 (-23%). ITV Studios restarted production in June 2020.
Companies: ITV Plc
These were impressive FY 20 results that came in at the top end of guidance given back in March. The Data & Information core has proven resilient whilst the swift digital transition with Training and Networking has mitigated the worst revenue impacts from lockdown. Underlying cash generation was healthy, and management have been able to materially de-risk the balance sheet without needing to raise dilutive, new equity capital. In this note, we are re-initiating coverage will full estimates published for FY 21 and beyond. We also discuss the revenue scenarios outlined by the company at the FY 20 results announcement and what these imply in terms of earnings outcomes. Both of these scenarios hinge on the key swing factor for FY 21; namely whether face to face events can resume in time for Wilmington’s H2. Our estimates effectively represent a middle ground between these two outcomes. In our eyes, the current valuation is difficult to justify on fundamentals, nor on a comparative basis. Although we do not know the full current year outcome for the rest of the peer group, we would be surprised if many do better than Wilmington and yet the valuation gap has widened. Looking at the components within the group, the argument can be made that Risk & Compliance alone could be worth more than the current group market capitalisation. This suggests that investors are being given a free option on the c.£70m of revenue and £6m of EBIT (£80m / £13m pre-Covid) that sit outside Risk & Compliance.
Companies: Wilmington plc
Dods has acquired Merit Group Ltd, an Indian provider of data services and software code established in 2004. This is a transformational acquisition which will enable Dods to diversify its service offering into faster growing, higher margin activities. Dods has raised over £12m in an equity placing to finance the acquisition.
Companies: Dods Group Plc
Following continued delays of a Brexit agreement, few sectors within the UK market have remained attractive to investors despite low valuations. One sector which has continued to outperform despite the political drama has been the UK video gaming sector (henceforth UK gaming), which we are fans of. We believe a combination of sector-leading growth, strong cash conversion and timely cyclical positioning support our positive view on the UK video gaming sector.
Companies: ABBY AMS ANX ARS ATYM AVON BLVN PIER BUR CGS CAML CDM CSRT TIDE CYAN JET2 DEMG ELM EMR FPO FDEV GTLY GENL GHH GRI GEEC GKP HMI HAYD HEAD HILS HTG HUR IBPO IOG INDI JHD JOG KAPE KEYS KWS KCT KGH LAM LIT LOK MACF MANO MOD OXIG PCA PANR APP SRE PHC PMO RBW RMM RBGP REDD RSW RNO ROR SUS SCPA SEN SHG SOLG SOM SUMO TM17 INCE TWD TRAK TRI VNET VTC ZOO ZTF
Disney+ hits 22m mobile users, SoftBank backed firm downsizes IPO, German mobile carrier selects Huawei
Companies: ENET 7DIG MVR ZOO ZOO AMO BOOM MIRA MWE
Tremor’s AGM statement shows that Tremor was delivering on its strategy and on course to achieve FY20 revenue of $425m in Q1. However, the impacts of COVID-19 on the advertising industry led to a challenging Q2 20, with Tremor’s revenue falling with the market to be c40% below Tremor’s FY20 plan. In response, management have moved quickly to reduce FY20 opex by over $23m vs budget, and positioned Tremor’s platform to respond to a rebound in demand. There are encouraging signs for H2 20, but visibility continues to be low and Tremor is not giving guidance for FY20. We consequently introduce revenue and EBITDA ranges for FY20 and FY21, and place our estimates at the mid-point for FY20. To then highlight that Tremor’s platform can rapidly rebound, we move our previous FY20 forecasts to FY21. This reflects that we believe that Tremor’s investment case remains compelling, and even on our lower case FY21 EBITDA of $35m, Tremor is trading on 5x EV/EBITDA vs ad tech and AIM peers on >10x.
Companies: Tremor International Ltd.
Centaur Media has delivered a resilient H1 in which adj EBITDA remained positive at £1.0m (H1’19: £1.2m). Group sales decline of 27% to £17.7m was substantially offset by tight cost control and a shift in mix towards higher quality revenue streams. The Lawyer revenue renewal rate remained strong (106%) and supported Group premium content sales (-3% y/y to £6.9m), with Mini MBA sales (+101% y/y) performing well. Telemarketing sales (-36% y/y) and events (-82% y/y) were unsurprisingly impacted by lockdown restrictions, with MarketMakers now being restructured to focus Group resources on more profitable areas. The outlook remains uncertain, and we are not reintroducing forecasts at this time, however in an undemanding medium-term scenario, we see £5m FCF as achievable which would generate a FCF yield of 19% at current valuation. Net cash of £8.4m was held at 30 June, while an undrawn £1.7m overdraft and £10m facility with covenants waived until Sept 2021 provide additional balance sheet strength.
Companies: Centaur Media Plc
Kape’s strong H1 trading update highlights revenue and adj EBITDA growth of 97% y/y (to $59.0m) and +180% y/y (to $16.1m) respectively, in-line with N1Se forecasts. Underlying pro forma growth of +12% y/y is being driven by strong performance in Digital Privacy, and management are confident of meeting FY’20E guidance of $120m-$123m of sales (N1Se: $122.6m) and $35m-$38m of adj EBITDA (N1Se: $36.6m). The higher-growth Digital Privacy segment is forecast to deliver c.76% of Group sales in FY’20E. Alongside this, the opportunity created by the Group’s Privacy suite to crosssell additional services into the Digital Privacy base, and to improve already market-leading customer retention rates, further underpins N1Se medium-term sales growth forecasts of 10% CAGR to FY’22E. Our FY’20E forecasts generate FCF of $19.1m representing a 3.9% yield at current valuation, rising to 6.1% the following year. As cash-generation steps up, we see scope for the valuation discount to peers closing over time.
Tern plc* (TERN.L, 8.0p/£24.1m) | Corero Network Security (CNS.L, 8.25p/£40.8m) | Eagle Eye Solutions Group plc (EYE.L, 288p/£86.9m)
Companies: TERN CNS EYE
As expected, Informa’s H1 20 were badly hurt by the pandemic’s impact on physical events, although consolidated revenues (-£593m to £814m) and adjusted OP (-73%; £118.6m) were above street estimates. Non-cash impairments/exceptional costs also hurt, leading to a statutory pre-tax loss. The COVID-19 Action Plan is being pursued and the postponement plan is now due to last until mid/late Spring 2021. Costs savings raised to > £600m savings by year-end (versus £500m).
Further cuts expected to our earnings and target price.
Companies: Informa Plc