Investors have been choosing to take a more risk-averse position here until prospects for the UK consumer and AO’s German operation become clearer
Companies: AO World Plc
After a year of difficult macro and weaker than initially expected performance AO responded by reorganising management behind founder John Roberts. Today the company is effectively reporting on what was delivered under its now-replaced strategy. News on current work is more general. But we would expect more meaningful analysis from the company and some news on how it expects to be set up over the next few years at the Interims in November.
We have met returned CEO (founder) John Roberts. Our overall view is that he is motivated to re-energise the business over so long as it takes and to protect the value of his investment. He is clearly a top sales person so some context will be needed at the Prelims and probably more meaningfully the 2019/20 Interims in November. But overall we came away positive.
AO’s CMD highlighted the enthusiasm of the company anew and focused on the batch of new business areas under development. These included significantly a potential new Consumer Credit offer and more visibility on the already announced B2B division. On the more cautious side the current UK Major Domestic Appliances (MDA) market remains difficult in demand terms (down around 5% in 2Q as per GFK), albeit mitigated by a more benign pricing environment. The company’s upbeat view that recent flat-linin
AO World (AO) is the leading online retailer of domestic appliances in the UK and additionally has a significant non-UK operation in Germany and the Netherlands. Our initiation today examines its scaling-upstrategies and its potential to re-rate. We conclude that scaling potential is already being demonstrated outside the UK where we believe the ultimate value lies while the UK needs to show how it can grow its core MDA sales to counter recent signs of maturity. We initiate with a buy recommenda
This update will probably be viewed with short term caution as UK sales growth has slowed in June and the benefit from the World Cup comes into question. Europe looks good to us and that is where the upside from future scalability will emanate to drive re-rating if that happens. Sales in 1Q were +8% in the UK and +46% ex currency in Europe. There may be a negative read-across into Dixons Carphone (DC LN, 182p, Hold, TP 185p).
CentralNic-Schedule 1 from the business operating in proprietary retail platforms selling domain names and associated web presence services including hosting and email on a subscription basis, has acquired KeyDrive S.A which constitutes a RTO. Raising £24m at 52p, combined market cap of £88.7m
Trackwise—established business that manufactures specialist products using printed circuit technology. Offer TBA. Due Late July
Ovoca Gold (to be renamed Ovoca Bio PLC) - RTO of IVIX, a Russian company d
Companies: HUM CHLL AO/ CAR BION TAX SPE BHRD AMYT LDRUF
AO World (AO.LN, 151p, NR) has reported in line with its post close update issued on 6th April (underlying EBITDA losses £3.4m against £4.2m loss at that time).There is no formal guidance for 2018/19 but the company notes a good start to trade with UK sales up double digits year to date (v +6.2% 1Q last year). Lots of moving parts in this one notably the progress of the European loss making business but the statement does not suggest any big change to expectation which currently indicates a move
The online appliance retailer had a bumper Christmas period bolstered by a 60% spike in European sales.
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Today's results include few surprises in terms of cash outcomes, which are in-line with our FY21E forecasts. These record results come despite the year being challenged by Covid-19, evidencing the resilience of Duke's operating model and royalty partners. Post-period, 4 new investments have been concluded, which should help drive cash results higher over FY22E, despite a further 2 exits from the portfolio. As the company approaches near full deployment by FY23E, we expect to see FCF p/s and DPS
Companies: Duke Royalty Limited
Altus has acquired an effective 0.418% NSR over the producing Caserones copper mine in Chile. Altus’ royalty interest was acquired for $34.1m in cash as part of a strategic 50:50 partnership with EMX Royalty Corp. The acquisition was part financed with a $29m loan facility from major shareholder, La Mancha. The royalty is immediately cash generative and Altus expects the NSR to generate post-tax royalty flows of US$3.2m pa. Caserones is a large open-pit copper porphyry in Chile, operated by JX N
Companies: Altus Strategies PLC
Agronomics has announced a follow-on investment in existing portfolio company, Formo (previously LegenDairy Foods). The company has invested €3.15m in Formo's Series A funding, and now holds c5.9% of the enlarged share capital. The fundraise has generated a 7.5x uplift for Agronomics original €1m investment (Dec-19) and values Formo at c€180m (post-money) versus c€16m post-money value following the Seed round. Formo now becomes Agronomics largest holding, c9.1% and has delivered a net uplift in
Companies: Agronomics Limited
A disappointing earnings release coupled with low transparency on the Sandringham Financial Partners acquisition have led M&G’s share price to return to its pre-crisis level. While our valuation suggests a positive recommendation considering the low point, momentum remains uncertain.
Companies: M&G Plc
NextEnergy Solar Fund’s investment in NextPower III ESG is delivering in terms of widening international exposure with NPIII following its recent project win in Spain with another in Poland. This is the first acquisition the vehicle has made in Poland and the project will be supported by a fifteen year CfD. We see NESF’s investment in NPIII ESG as delivering a diversified asset growth opportunity and so far this is proving to be the case.
Companies: Nextenergy Solar Fund
Deltic Energy has had a highly successful 2021 year-to-date, as indicated in the interim statement. The key events have been the well investment decision in March for the Pensacola Zechstein prospect and the farm-out deal with Cairn Energy (CNE.L) in August over five licences in the Carboniferous/Zechstein fairway, towards the northern margin of the Southern North Sea Basin (SNS). The farm-outs firstly with Shell in 2019 and then Cairn have validated Deltic’s strategic focus on the Carboniferous
Companies: Deltic Energy PLC
What’s new: Tatton has signed a 5 year distribution partnership with Fintel and agreed to acquire Fintel’s Verbatim Funds for £5.8m cash consideration of which £2.8m is on competition and £3.0m is subject to performance
Companies: Tatton Asset Management Plc
Tatton has acquired the Verbatim funds from Fintel for (up to) £5.8m adding £650m AuM – and pushing Tatton’s AuM through the £10bn milestone. A long term strategic partnership has also been formed allowing Tatton to market to Fintel’s significant intermediary client base. We upgrade our earnings forecasts by +4% for the part year contribution in FY22e and +11% FY23e (the first full year) – but make no assumption around the potentially material opportunity from the distribution partnership. Tatto
Bluejay Mining* (JAY LN) – Greenland agrees new economic aid with the US
Ariana Resources (AAU LN) – Further drilling results from Kepez North
CATL (CATL N) – CATL may be joining the bidding war for Millennial Lithium Corp. as Chinese firms battle for EV material supply
Condor Gold* (CNR LN) – Senior mining engineer appointed to advance La India feasibility study
Cora Gold* (CORA LN) – Interims
Galileo Resources (GLR LN) – Sale of Kalahari Copper Belt licences expected to complete next week
Companies: AAU JAY CNR CORA GLR GGP POW RRR VUL SSW
NextEnergy’s JV with storage specialist Eelpower is an important strategic development. Storage demand is set to grow if the UK is to move towards its net zero targets and the combined attributes of the JV partners make it well suited to succeed here. For NESF it opens up a new route to asset growth in our view.
NextEnergy Solar Fund (NESF), which has the ability to invest up to 10% of its gross assets in energy storage, has announced a significant step into energy storage with the establishment of a £100m joint venture partnership with one of the leading battery storage specialists, Eelpower Limited (Eelpower). The joint venture is owned 70% by NESF and 30% by Eelpower. The partnership has also announced the signing of its maiden acquisition, a 50MW standalone battery storage project, which is ready to
Exactly one year ago, the FTSE 100 closed at 5,862, having fallen 100 points on the day, the lowest point since mid-May 2020, due in part, to the strength of sterling vs US$ at $1.34. One year on, the FTSE 100 has risen to 7,119, a rise of 21%, it remains 7% below the peak in January 2020. From an international viewpoint, US and European markets continue to trade at record highs. The US Federal Reserve is close to withdrawing some of its economic support this year as inflation picks up and the e
Companies: AMYT BAG BVC BRSD CLG CML FBD GDWN INV MACF MNZS MIO NRR NSF NBI MATD PREM QFI RUA SCS STVG SUR SNX UPGS VAST VLS
Companies: Harworth Group PLC
In line interim results to 30 June 2021: reported revenue was £11.4m, down 3.4%, as a result of the trust disposals; and reported PBT was £0.9m, down 6.5% YoY also as a result of disposals as well as disappointing volumes in certain areas of new business, namely UK SIPPs and the flexible annuity product. Positively, however, higher-than-anticipated revenues came from UK workplace pensions, while recurring revenues improved, reaching 88% without the inclusion of transaction-driven income in the d
Companies: STM Group PLC
AEX Gold (AEXG LN) – Further management changes at AEX to drive development of new plan
Altus Strategies* (ALS LN) – Valuation 125p – First Caserones NSR royalty payment in respect of Q2/21 expected this month
Beowulf Mining* (BEM LN) – CEO letter to Minister Baylan regarding Kallak
Bluejay Mining* (JAY LN) – Valuation 37.7p – Interims highlight activity towards development of the Dundas ilmenite mine and other exploration
Caerus Mineral Resources (CMRS LN) – Progress report on prospective j
Companies: AEX ALS BEM JAY CMRS CORA PDL POW TYM URU CCZ IRR