Companies: AVCT COG UNG
Chariot Oil & Gas (CHAR): Corp | dotDigital (DOTD): Corp | Gateley (GTLY): Corp | Iofina (IOF): Corp | Synairgen (SNG): Corp | Universe Group (UNG): Corp
Companies: CHAR DOTD IOF SNG UNG GTLY
Interim revenue to June is in line with 1H19 including the benefit of Celtech (acquired April 2019). Recurring data services revenue grew 19.9%, while elements of implementation suffered from COVID-19: Services and Installation -4% and Consultancy & Maintenance -10%. A focus on cost control resulted in furloughed staff (now returned to work) from a larger cost base than 1H19 after the Celtech integration, and some August redundancies in areas where customer activity has reduced and will likely stay low. Nevertheless, the group won significant business in the period from several major customers as a well as a new Outdoor Payment Terminal contract. A pipeline of £12.5m for 2H20 offers typical 2H strength for the group, derived from recurring revenue and the visible order book, subject to obvious concerns about the ability to implement projects. Net cash (excl. IFRS16) of £1.6m includes gross cash of £4.1m and gross bank debt of £2.5m, with £1.5m headroom in the undrawn April 2023 bank facility.
Companies: Universe Group PLC
Avingtrans (AVG): Corp | Chariot Oil & Gas (CHAR): Corp | dotDigital (DOTD): Corp | Gateley (GTLY): Corp | Iofina (IOF): Corp | Synairgen (SNG): Corp | Universe Group (UNG): Corp
Companies: AVG CHAR DOTD IOF SNG UNG GTLY
Belvoir Group (BLV): Corp April significantly stronger than anticipated | Bigblu Broadband (BBB): Corp Reassuring update with strong organic customer growth | ClearStar (CLSU): Corp New COVID-19 testing service | KRM22 (KRM): Corp Finals to December 2019 | Oncimmune Holdings (ONC): Corp EarlyCDT Lung partnership | Shield Therapeutics (STX): Corp FY 2019 results | Universe Group (UNG): Corp FY19 on track, with a good start to FY20
Companies: UNG KRM BLV BBB
Universe has delivered final results to December FY19 in line with the trading update of early April, revealing EBITDA of £3.9m from revenue of £22.4m. Unusually strong free cash flow of £3.6m led to net cash of £2.9m, well ahead of original expectations of £0.9m net debt. Pre-COVID-19, FY20 got off to a strong start, with 1Q20 revenue of £5.2m and £16.8m visibility through recurring revenue and the order book proving underlying strength in a normal environment. With the successful April 2019 acquisition and subsequent integration of Celtech, the R&D roadmap has been accelerated an estimated three years or more, and the three strategic aims for the year (best product set, new business, and growth) have been fulfilled.
ANGLE (AGL): Corp Progress report since COVID-19 lockdown | NAHL (NAH): Corp Navigating change in difficult markets | Omega Diagnostics (ODX): Corp VISITECT CD4 supply agreement with CHAI | Proactis (PHD): Corp Reset of banking facility | STM (STM): Corp Transitioning into new markets from a robust base | Universe Group (UNG): Corp Strong FY19 trading update, strong FY20 order book
Companies: ODX PHD STM UNG AGL
Shares of Nintendo surged on Friday after the Japanese gaming company said Thursday that its second-quarter operating profit more than doubled amid strong sales for the recently launched Switch Lite device. By Friday's market close in Japan, Nintendo's stock skyrocketed 7.46%. Between the Switch Lite's launch on Sept. 20 and the end of the quarter, Nintendo said it sold 1.95 million units of its handheld-only device. Sales figures for the Switch Lite - a stripped down and lower-priced version of Nintendo's flagship Switch console - are being closely watched by the market.
Companies: BIDS CDM FDEV GFIN KWS SUMO TM17 UNG
Universe has delivered interims to June, reporting revenue growth of 7.3% (2.5% organic), boosted by the April acquisition of Celtech. EBITDA of £1.76m (equivalent to pre IFRS £1.39m) demonstrated 42% growth on a like-for-like basis, with the revenue mix strongly benefitting gross margin, which improved from a consistent 47-49% range 1H17-2H18 but lifted to 56% in 1H19. Data services revenue, constituting 21% of FY18 revenue, grew 28.9%, boosted by a customer’s ongoing large managed services security project; and consultancy and licence maintenance, also a higher-margin revenue stream, growing 26.8% with the inclusion of Celtech. With 43% of unchanged FY revenue expectations and 46% of EBITDA delivered in 1H19, we look forward to the full benefit of the Celtech acquisition in 2H – along with the benefit of further contracts from two existing major clients, along with management confidence in the pipeline of a small number of high value contracts. Target 10p reiterated and we look forward to positive newsflow regarding new contracts and HTEC / ab-initio cross sales.
Iofina (IOF): Corp Q1 2019 market update | LiDCO (LID): Corp South Korean approval | Omega Diagnostics (ODX): Corp Trading update – in line implying H2 profitability | Universe Group (UNG): Corp Robust prelims | ZOO Digital (ZOO): Corp Year end trading update
Companies: IOF ODX UNG
Universe has overcome the set back of the demise of Conviviality (and associated £2m order) to deliver a positive year, including successful deployment of a major Gempay3 roll out. Revenue of £19.9m (£19.6mE) and EBITDA of £2.7m (2.4mE) pleasantly exceeded expectations established at interims, leading to adjusted EBIT, PBT and EPS >20% ahead of forecasts. FY18 net cash of £1.9m (£1.6mE) gave balance sheet strength, deployed post-period end with the strategic acquisition of Dublin-based Celtech, adding a cloud-based, real-time modular software platform as well as a strong client list. We look to a mixture of organic and acquired growth, with the opportunity to deliver the financial momentum to confirm the operational development of a new CTO, a new head of sales, a broader product set, a wider customer base in convenience stores, and Gempay3 success. Target 10p reiterated, representing only 7.6x EV/EBITDA and 18.5x P/E and retaining room for positive review with execution proof.
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. Loungers plc—the operator of 146 café/bar/restaurants across England and Wales under the Lounge and Cosy Club brands, announces its intention to seek admission on AIM, offer TBC, expected late April. 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.
Companies: HUR FAB PREM NTQ LTG DCTA UNG
Universe has announced the £5.2m acquisition of Camden Technology, trading as Celtech, funded by existing resources and a £5m debt facility. Dublin-based Celtech delivers a cloud-based, real-time modular software platform called ab initio, providing retail and wholesale management solutions to well known retail names such as Bestway, One Stop (900 stores) and various Co-Ops, in the UK and Ireland. The acquisition represents an important technology grab and extension of the customer base, advancing Universe’s HTEC solution by 3-4 years, delivering a boost to recurring revenue, and enhancing prospects for growth. With a 9-month FY19 contribution (expected to be earnings enhancing in FY20, earnings neutral FY19), we look forward to prelims on 16 April. Pre-acquisition FY18 performance is confirmed as in line with unchanged expectations, and better than expected cash generation led to FY18 net cash £1.9m (vs £1.6mE). Target 10p reiterated.
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.
Companies: MIO CAML MPE PPC WINE PPS SIS SOS UNG RMS
Avesoro Resources (ASO): Corp New Liberty mineral resource upgrade | Cambridge Cognition (COG): Corp NeuroVocalix – first contract | Cello Health Group (CLL): Corp Trading well with good visibility | Hardide (HDD): Corp Upbeat trading update | InnovaDerma (IDP): Corp FY 2018 results – Boots to range Skinny Tan | Premaitha Health (NIPT): Corp Settlement with Illumina – freedom to operate globally | Quixant (QXT): Corp Weighting on a record H2 for gaming platforms | ThinkSmart (TSL): Corp Credible innovator, now developing new opportunities | Universe Group (UNG): Corp Interims
Companies: COG IDP QXT UNG HDD
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As a nation, we love knocking ourselves. However in truth, we’re actually a pretty pioneering bunch. For instance, the experts at Oxford University & AstraZeneca have developed one of the world’s 3 most important vaccines in double quick time. Plus, many other British firms are creating similar breakthrough Covid inventions, such as Kromek.
Companies: Kromek Group Plc
H1A delivered a very resilient performance given the backdrop of halted deliveries and reduced manufacturing capacity. Orders and shipments are resuming and a ramp up in activity levels is expected in H2. A cash outflow in H1A has been supported by new committed facilities and gross cash levels look set to support the business successfully through the second half and beyond.
Gamesys has reported a positive pre-close trading update. Strong momentum continued into Q420 and management now expects FY20 pro forma revenue and adjusted EBITDA will be at or above the upper end of current market expectations. We increase our FY21 and FY22 adjusted EBITDA forecasts by 4–6% due to higher revenue growth from a larger active customer base, and a higher and stable EBITDA margin that reflects ongoing investment in growing a sustainable business with a focus on responsible gambling. On our new forecasts, the free cash flow (FCF) yield for FY21e is 10.1% and the dividend yield is 3.0%.
Companies: Gamesys Group PLC
WEY Educaon (WEY) – Corporate – Trading significantly ahead; strong momentum prompts new ’21/’22E forecast
Touchstar (TST) – Corporate – Update points to a robust trading performance and strong cash generaon in the year
Companies: Wey Education PLC (WEY:LON)Touchstar plc (TST:LON)
A busy post-YE update reveals a strong H2 performance despite the second wave of COVID-19, and management expects to meet our FY20 forecasts of revenue and adj. earnings growth. As noted last year, there will be a £1.6m exceptional provision in FY20 for replacing its US tracking devices as 3G service ends there in 2022; it will not affect FY20 adj. earnings but will impact FY21 cashflow. YE net cash was slightly above expectations at £10.6m despite a laudable repayment of all government COVID support received. Most of that cash balance should be distributed in the return of the supplemented final dividend, subject to conditions at the time of the declaration in March. Looking ahead to FY21, management sees notable Fleet growth opportunities post-COVID and is flagging an extra c.£1m investment – mainly in sales & marketing – with a new focus on revenue expansion, and we expect to see the benefits of that in FY22. The CFO, Dan Mendis, will supervise this Fleet expansion, moving to the role of Group Commercial Director while Emily Rees joins to replace him in April. We adjust our FY21 forecasts accordingly and issue FY22 expectations for growth. With the business well on track, we raise our TP from 435p to 450p.
Companies: Quartix Holdings Plc
iEnergizer announced the proposed payment of a special dividend worth 49.4p ($0.668) per share. The group has stated the stock will go ex-div on 14th January 2021, with a pay date of 5th February 2021. At a total value of £94m ($127m), this dividend represents a significant payout for shareholders, c.13% of Group's market cap of £730m. We acknowledge this to be a clear signal of confidence in the growth trajectory and current operations.
Companies: iEnergizer Limited
Instem has delivered a positive trading update for the year to 31 December 2020 – revenue growth was “in excess of 11%”, suggesting a performance in line with our estimates, and net cash appears to have ended the year extremely strongly, with a figure of £26.7m vs our expectation of £22.4m.
Companies: Instem plc
Instem has delivered another year of double digit revenue growth, in line with expectations. Progress has been made across all three business streams, buoyed by strong demand from new and existing customers. A key highlight is cash generation, with Y/E net cash £3.2m better than expectations at £26.7m (pre-IFRS16). The outlook remains positive, with further organic growth opportunities in areas such as SEND exploitation and Informatics. The company remains in active discussions with a number of acquisition targets following the £15.0m fundraise in July. The valuation remains extremely undemanding and we continue to see significant upside potential for a business with multiple organic and acquisitive growth opportunities.
Touchstar is a supplier of mobile data computing solutions and managed services to a variety of industrial sectors. The group has this morning released a year-end update, pointing to the fact that the Board expects to report a profitable outcome for the year (H1 2020A PBT £130k, PAT £150k). Importantly, the positive cash generation seen in H1 2020A has continued into H2, with Touchstar ending the year with a net cash position of £1.6m (gross cash £1.9m), a further increase of £300k from that reported at 30th June.
Companies: Touchstar plc
Cornish Metals (TSX-V: CUSN) intends to list on AIM. The Company is proposing to raise £5 million by way of private placement of new Common Shares (the "Fundraising") to advance the United Downs copper-tin project. The Company expects that Admission will become effective in February 2021. The Company's Common Shares will continue to be listed and trade on the TSX-V in Canada. Further media reports that Dr Martens, the British Boot brand is planning an IPO on the LSE. It is currently owned by PE group, Permira who is expected to sell down its stake at the IPO. March 2020 YE the group had revenues of £672m and EBITDA of £184m. Deal size TBC. VH Global Sustainable Energy Opportunities plc, a closed-ended investment Company focused on making sustainable energy infrastructure investments, today announces intends to launch an initial public offering of shares on the Official List (Premium) of the Main Market of the London Stock Exchange. Due by Early Feb. Moonpig, the digital greeting card company, is planning an IPO with a potential valuation of £1bln, according to multiple media reports. Further details expected to be announced over the next two weeks.
Companies: ZPHR PANR PRSM SENS CYAN G4M ITX CRCL FEN ZIN
Material acceleration of strategic plan
Companies: MelodyVR Group PLC
Crimson Tide has reported a strong set of H1 results evidencing very strong sales momentum backed by long-term contracts and cash flow. H1 sales grew by 40% and EPS by 154%. Net cash has improved to £0.8m at June 2020 from nil at December 2019. The strategic focus on transportation and supermarkets is working well, partnerships are improving routes to market, and there is growing traction from investments in innovation. We have left our forecasts unchanged for now, but recognise positive pressure and have upgraded our target price from 3.1p to 4.3p. We reiterate our view that Crimson Tide’s valuation will be dictated by its ability to convert the significant opportunity rather than short-term metrics. H1 results show the group is nicely on track to do exactly that.
Companies: Crimson Tide Plc
Following Fonix successfully raising £45m through an oversubscribed IPO on 12 October, we initiate our coverage with a target price of 150p. The investment case is focused upon Fonix leveraging its proprietary, cloud-based platform to expand with existing clients and win new clients within a robust UK phone-paid services market. The structural strength of Fonix’s platform is demonstrated by Fonix experiencing no churn from major customers in the past six years, which reflects that Fonix benefits from strategic integration and strong relationships with its clients. Fonix’s FY20 gross profit and EBITDA grew by +22% and +36% respectively, and we conservatively forecast +11-12% EBITDA and EPS growth in FY21 and FY22. On 12m forward EV/EBITDA of 10x and an EFCF yield of 7%, Fonix looks considerably undervalued compared to AIM payment and finnCap Tech 40 peers that are trading on 12m fwd EV/EBITDA of 17-20x with 7-17% EBITDA growth, and EFCF yields of 1-3%. We base our 150p target price on 15x FY22 EV/EBITDA or a 5% FY22 EFCF yield, and look forward to Fonix’s trading update in early 2021.
Companies: Fonix Mobile PLC
It has been a year the likes of which we have never seen before, and hope never to see again. The description of the impact of the CV19 pandemic as K-shaped certainly feels accurate, with some sectors being well placed to benefit from the creative disruption that has engulfed the world, accelerating structural changes, while others through no fault of their own have been severely impacted. This has been the case for the Dowgate portfolio of corporate clients, with our quoted clients falling into three groups. The first, comprising Cambridge Cognition, GRC, The Panoply, S4 Capital and Water Intelligence have on average seen their share prices double this year as structural changes accelerated by CV19 have been accompanied by strong execution. The second, comprising Franchise Brands, OTAQ and SEEEN, have experienced share price declines averaging a third as their businesses have either been directly impacted by CV19 or their growth aspirations curtailed. The final group comprises those companies which have been bid for this year, namely Be Heard, Hunters Property, Huntsworth and Reach4Entertainment. Looking into 2021, we expect continued strong performance from the first group and a rebound in the second as the world returns to normal. Finally, having completed Series A/B rounds for a range of private companies this year, we hope to bring these entrepreneur-led, growth companies to market in 2021.
Companies: COG FRAN GRC OTAQ TPX SFOR SEEN WATR
Gaming Realms is a creator and licensor of innovative games for mobile, with operations in the UK, U.S. and Canada. Flagship brand Slingo® is a highly popular and unique game genre which combines elements of slot, bingo and table gameplay. These games are licensed by some of the biggest online gaming operators in the world, including DraftKings, Sky Betting & Gaming and GVC, and distributed directly to operators or via global partners such as Scientific Games & Relax Gaming using the company's proprietary Remote Game Server platform.
Companies: Gaming Realms PLC