Morning Note – 26 March 2024

Cautiously optimistic of improving conditions in H2

Empresaria’s FY23 results were well flagged in the 26th January update. 2023 was a challenging year for the staffing industry and for Empresaria. As a result, NFI reduced by 12%, with adj. PBT reducing from £9.0m to £3.5m, in line with expectations. Whilst challenging market conditions are expected to persist during H1’24, management is cautiously optimistic of an improvement in H2’24 and cost actions during FY23 (headcount down 17%) should benefit earnings in FY24. We continue to point to value

Empresaria - Offshore Services underpins upside in challenging markets

Empresaria’s FY 2023 results are in-line with the January statement. Recruitment markets remain challenging (a point also recently highlighted by peers) but Empresaria has taken action to reduce costs, complexity and sharpen focus on its core sectors. This puts the group in a good position to take advantage of any market recovery with management cautiously highlighting the expectation of an improvement from H2. We make no major changes to our forecasts except to rebase dividend expectations to t

Value driven by Offshore Services

Following on from the 21st November update, Empresaria’s year end update yesterday confirmed an NFI reduction of 12% and an adj. PBT outcome which is expected to be at the top end of the rebased guidance range (£3.0m-£3.5m vs. our previous forecast of £5.0m). The outturn is therefore c.£0.5m better than we expected. Against a currently challenging market backdrop, valuation multiples are stretched given depressed earnings. However, cost action (headcount down 17%) supports an improvement in our

Morning Note – 25 January 2024

Empresaria - Offshore Services outperforming and underpinning value

Empresaria has detailed that FY23E net fee income (NFI) reduced by 12% to £57.5m (our forecast £58.0m) and adj. PBT is expected to be at the top end of the range guided in November 2023 of £3.0m to £3.5m (our forecast £3.2m). Offshore Services has continued to outperform, with NFI up 4%. Permanent placement activity was the most significantly impacted with NFI down 25%. Temporary and contract NFI was down 10%, primarily driven by the global IT sector and the US healthcare sector. Net debt of £11

Hybridan Small Cap Feast - 21 Nov 23

21st 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

Challenges expected to continue through H1’24

Empresaria’s trading update confirms that trading is expected to remain challenging during the remainder of FY23 and through H1’24. As a result, we further revise down our forecasts, with our FY23 adj. PBT forecast reducing by 40% to £3.0m (bottom end of the £3.0m-£3.5m guidance range) from £5.0m previously. Our EPS forecast reduces by a greater quantum, reflecting the significant non-controlling interest in Offshore Services and a higher tax rate. Given lower than expected working capital inves

Morning Note – 21 November 2023

Empresaria - A challenging backdrop, but value remains

Empresaria has today released a trading statement which reveals that the challenging market conditions endured during the course of 2023 have continued into the fourth quarter and it now expects to see these continue into the first half of FY24. The most significant impact has been on permanent recruitment and it is now seeing clients deferring hiring decisions and/or start dates until the new year. As a result, FY23 adjusted PBT is expected to be in the range of £3.0m to £3.5m. Taking our previ

H1 well flagged; trading in line with rebased forecasts

Empresaria’s interim results were well flagged in the 27th July trading update, which highlighted continued challenging trading conditions. Net fee income reduced by 9% YoY in H1 to £29.7m, with adj. operating profit down 71% to £1.3m. With the previously anticipated improvement in trading conditions not materialising, we rebased forecasts at the July update. Trading remains in line with these revised forecasts and we make no further changes today. Guidance takes a cautious view on the pace of r

Cenkos: Empresaria Group Plc -- Interim Results

Empresaria has released interim results for the 6-month to 30 June 2023. As outlined in the July trading update, H1/23 has been a challenging period for Empresaria as a result of softening demand and slowing of hiring decisions. Despite the challenging environment, the Group continues to make progress on key strategic initiatives. In our view, the current valuation underestimates the overall resilience of the model with FY23E PE of 12.8x, presenting an attractive buying opportunity (on a recover

Hybridan Small Cap Feast 15/08/2023

Andrada Mining 7p £107.7m (ATM.L) The African technology metals mining company with a portfolio of mining and exploration assets in Namibia, provides an update on the previously proposed Funding Package with funds managed by Orion Resource Partners announced on 15 September 2022. On 11 August 2023, Andrada signed binding documentation for an updated, conditional US$25m funding package with Orion. The financing agreement is as follows: US$2.5m (c£2.0m) equity at 6.39p and US$10m (c£7.9m) Convert

Continued market challenges impact results

Empresaria’s trading update highlights that challenging market conditions continue to impact results and performance is not showing the signs of improvement that had been anticipated. As a result, we have made material changes to our forecasts. Our adj. PBT forecast reduces by 29% to £5m. Our adj. EPS forecast reduces by a greater quantum of 55% to 3.0p, reflecting the significant non-controlling interest in Offshore Services. Our net debt forecast is unchanged at £11m, with leverage at 1.4x. Gu

Cenkos: Empresaria Group Plc -- Challenging market conditions

Empresaria released a 6-month trading update has highlighted continued softening in demand and slowing of hiring decisions. It now expects FY PBT to be materially lower than market expectations. At the headline level, we reduce our FY23E PBT and EPS forecasts by 28.0% and 53.4% respectively. Whilst a disappointing near-term development, we continue to believe the group is well positioned in the long-term, given ongoing structural growth drivers, it's geographically diverse business and the growt

Supreme (SUP LN) - Record performance, EBITDA ~doubled

Supreme’s FY24 trading update confirms a record performance in the 12 months to 31 March 2024. Organic revenue and profit growth across all four divisions has driven Group revenue +45% YOY to £225m, with FY24 adj. EBITDA almost doubling to ‘at least £38m’, driving record levels of cash generation. Supreme is actively exploring complementary M&A, supported by a debt free balance sheet. Trading on an undemanding FY25 PE of just 6.7x, with a 3.4% yield, we believe downside risks are more than price

Morning Note – 22 April 2024

Supreme+ (SUP, House Stock at 125p) - Supreme, Supreme!

Trading update highlights scale of growth

In a Trading Update for the twelve months to 31 March 2024 Supreme expects to report revenue of c.£225m, and (adj.) EBITDA of at least £38.0m, in line with market expectations, which had been revised upwards during the course of the year and represents almost double the FY23 level. The Group closed the year debt free. Our outlook highlights the extent to which Supreme has expanded, through both acquisition and organic growth during the period. From 2020 to 2024E the Group will have grown sales

SP Angel Spec Sits: FY Trading Update (LTHM)

Headlam Group - Strategy for growth in tougher market

Headlam Group has laid out an ambitious long-term revenue target of between £900m and £1bn, as it seeks to grow its share of the UK floor coverings distributor market. Despite a challenging backdrop due to the low level of residential housing transactions, management is seeking to expand each of its sales channels: Trade Counters, Larger Customers, Regional Distribution and Europe & Other. The FY23 results reflected the more challenging environment and the group trades at a discount to its long-

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

SP Angel Morning View: Copper prices hit $9,700/t as China smelts concentrates for zero charge Tc/Rc

LIBERUM: Ilika: CMD confirms operational progression

LIBERUM: Gattaca: Resilient contract performance, perm tough

LIBERUM: Severfield: Erratum: Better EPS and cashflow, and buyback

LIBERUM: CEO Video: Matt Wragg, Gattaca plc:

LIBERUM: Capex Cycle: Miners' spending continues to lift

Hybridan Small Cap Feast - 22 April 2024

22nd April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi

VSA Morning Flow Test 19/04/24 (Quadrise)

Quadrise (QED LN) has provided an update on its Utah project with Valkor. Valkor’s partner (Heavy Sweet Oil LLC) has received funding and approval to commence drilling enabling production of 20-40bopd of heavy sweet oil providing QED with samples for production of test scale quantities of MSAR and bioMSAR; the company’s key fuel decarbonising emulsion fuel products. This should derisk the commercial scale ramp up. QED management has highlighted that Valkor has not yet raised the minimum of US$