The Pebble Group, a provider of products, services and technology to the global promotional products industry, announces its intention to seek admission of its shares to trading on the AIM market of the London Stock Exchange, which is expected to take place in early December 2019.The Group delivered revenue of £99.8m in the year ended 31 December 2018.No mention of bottom line and a suggestion that funds raised would provide an exit to private equity shareholders and the repayment of debt. Offer TBA.
Longboat Energy raising £10m at 100p. Expected admission November 2019. The company has been established by the former management team of Faroe Petroleum to create a new full-cycle North Sea oil and gas company .The strategy to achieve this will initially be through the acquisition of assets where the management team can add value through subsurface and operational improvements, follow-up deal opportunities and near-field exploration; and by value creation through the drill bit. Due 28 Nov.
MJ Hudson Group PLC, the financial services support provider to Alternatives fund managers and asset owners, is planning an AIM IPO. Deal details TBC but expected admission date mid-December.
Companies: GRP BSE SWG UJO VRS VEC PRES WATR
The Pebble Group, a provider of products, services and technology to the global promotional products industry, announces its intention to seek admission of its shares to trading on the AIM market of the London Stock Exchange, which is expected to take place in early December 2019.The Group delivered revenue of £99.8m in the year ended 31 December 2018.No mention of bottom line and a suggestion that funds raised would provide an exit to private equity shareholders and the repayment of debt. Offer TBA. Longboat Energy raising £10m. Expected admission November 2019. The company has been established by the former management team of Faroe Petroleum to create a new full-cycle North Sea oil and gas company .The strategy to achieve this will initially be through the acquisition of assets where the management team can add value through subsurface and operational improvements, follow-up deal opportunities and nearfield exploration; and by value creation through the drill bit. Sapo PLC - an investment vehicle under the NEX Exchange Rules, seeks to invest in the developing market for rural broadband in the United Kingdom. Due 2 Dec. Taseko Mines - North American focused copper producer and developer, seeking a London Listing. No capital raise. Due 22 Dec SDIC Power - “potential intention to float”. Proposed GDR listing. Leading power generation company in China, with a diversified portfolio of projects across hydropower, coal-fired power, wind power and solar power. Offer TBA
Companies: SECG INFA NET PCIP TAVI PRSM NSCI ANR EOG GRP
Over the past two decades, onshore wind power has prospered and now exceeds 12 GW in the UK. The termination of subsidies for new plants from 2017 onwards has cut investment. Instead, offshore wind power is the new ‘goto’ investment sector, as there has been a sea-change in costs. The key event was the 2017 auction for the development of the Hornsea Project Two and the Moray East fields, when 15-year contract for differences (CfDs) were awarded, at just £57.50p per MWh; this compares with the 2018 £100 per MWh target that had been set previously by the Government. In recent years, solar power has come of age. Total UK solar capacity now exceeds 12 GW. Inevitably, most solar farms are based in the Midlands or in the South, where irradiation levels exceed the UK average. A typical solar farm portfolio might include 50 sites with 8 MW of capacity per site. Despite the removal of subsidies for new solar plants, the prospects remain bright for new build, since costs have fallen appreciably in recent years. The levelised cost (LCOE) of solar power should fall below £70 per MWh. The UK’s first subsidy-free solar farm has been commissioned at Clay Hill in Milton Keynes. For many investors, REIFs offer an attractive means of securing exposure to the benefits of rising UK investment in these sectors, much of which is backed by long-term contracts delivering generally solid and secure returns. Our sector research focuses on 11 quoted REIFs, which mirror those selected by members of the Association of Investment Companies (AIC). The recently floated Aquila European Renewables fund is included, despite its declared policy not to invest in UK generation. Since May 2014, REIF returns have been solid, with total returns approaching 10% per year. As a group, their combined market capitalisation is ca.£7bn; the most valuable quoted funds are Greencoat UK Wind (£2.1bn) and The Renewables Infrastructure Group (£1.8bn). The sector premia over net asset valuations (NAVs) for most REIFs now lie in the 9%-19% range. The premium for Greencoat UK Wind, following its £375m gross fundraise, is ca.14%; The Renewables Infrastructure Group premium is similar. Targeted real dividend increases underpin the attractions, in particular, of wind and solar investments; major earnings shortfalls are low-risk, with little likelihood of a dividend cut. Prospective dividend yields for most REIFs currently lie in the range of 5.0%-6.0%. In terms of risk, future movements of interest rates could have a material impact on NAVs and, consequently, upon share price ratings. The precise effect will depend on the degree to which the discount rates moves relative to the riskfree rate. Regulatory amendments, subsidy changes and possible tax adjustments are also key risk factors with one company commenting that movements in long term power price forecasts are the most significant risk.
Companies: TRIG UKW NESF FSFL AERS GSF GRP SEIT USF
Fundraising showed signs of picking up this month, and the focus was very much on the renewables sector. First of all there was Renewables Infrastructure Group, which launched a placing programme and an initial fundraising early in the month, targeting up to £170m. It ended up raising just over £300m, having received applications for nearly three times as many shares as were originally available, in an upsized and scaled back issuance. Greencoat Renewables also announced and completed a placing which raised EUR 148m, around 40% more than the target. Another indication of interest in this sector was John Laing Environmental Assets successfully placing around 22m of its shares that were being sold by The John Laing Pension Trust. Finally, with regard to news in this sector, the close of the US Solar Fund* IPO had to be put back after just falling short of its target by the original closing date – closing is now expected to take place on 10 April.
Companies: TRIG BBOX UKW GRP ALF ELTA ESP FAIR BCPT BREI HTCF MERI UKCM
Greencoat Renewables – Results of fundraising | Empiric Student Property – Finals to 31 December 2018 | GCP Student Living – Interims to 31 December 2018 |
Companies: GRP ESP DIGS
Greencoat Renewables – Finals to 31 December 2018 and proposed placing | Syncona – Acquisition of Nightstar |
Companies: Greencoat Renewables Syncona
Greencoat UK Wind – Acquisition and fundraising | Greencoat Renewables – Q4 2018 NAV and dividend | AEW UK Long Lease – Q4 2018 NAV and dividend
Companies: Greencoat UK Wind Greencoat Renewables
Renalytix AI—developer of artificial intelligence ("AI") decision support and clinical management tools for improving early diagnosis, continual monitoring and drug development for kidney disease. incorporated in March 2018 as a subsidiary of EKF Diagnostics Holdings (AIM-EKF). Total fundraising in the range £21 - 25 m. Mkt cap - c. £67.5- £71.0m. Due 2 Nov.
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.
Azalea Energy—oil and gas production and development company based in Louisiana, United States. Net production of 13 MMcfe/D (2,200 boepd) and total 1P proved reserves of 91 Bcfe (15.1 mmboe), 2P reserves of 111 Bcfe (18.5 mmboe) raising up to $38m, expected mkt cap over $100m. Due 29 Oct
Path Investments— First acquisition of a 50 per cent. participating interest in the producing Alfeld-Elze II gas field located 22 kilometres south of Hannover in Germany. Seeking £10m raise. Due late Oct
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.
Companies: N4P HZM DCI MERC GRP W7L INCE GMAA ANG EVR
Greencoat Renewables – Acquisition | Chenavari Toro Income – September 2018 update
Companies: Greencoat Renewables Toro
John Laing Environmental Assets – JLEN – Capital increase | Big Yellow Group – BYG – Capital increase | Greencoat Renewables – GRP – Acquisition
Companies: JLEN BYG GRP
SQN Asset Finance – June 2018 NAV and investment update | Greencoat Renewables – Results of fundraising | Unite Group – Interims to 30 June 2018
Companies: SQN GRP UTG
Vannin Capital—Press reports that litigation funder Vannin Capital is working on plans to float on the London Stock Exchange later in 2018 with an expected valuation of well over £500m | Avast, global cybersecurity provider with 435m users worldwide. In 2017, the Group's Adjusted Billings was $811 million, Adjusted Revenue was $780 million, Adjusted Cash EBITDA was $451 million. Seeking to raise $200m. Due in May | 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 03 May | 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 | Finablr - press reports in ‘Arabian Business’ that Money transfer firms UAE Exchange, Travelex and others under UAE billionaire Bavaguthu Raghuram Shetty’s newly formed holding company Finablr are preparing for a London IPO
Companies: MORT BION CORA ATQT ICON GRP MXO MIRI SYME
2017 was an outstanding year for stock markets, perhaps somewhat unexpectedly given the levels of pessimism about the state of the world a year ago. But such views turned out to be well off the mark, as rising corporate earnings and economic growth pushed major global indices to all-time highs. While the UK small cap indices were unable to scale new peaks in 2017, the mood of general investor bullishness did not elude them, with annual gains of well over 20%. This was reflected in a solid year of IPO activity on London’s junior market, with over £2bn of new money raised, up 51% on the previous year.
Companies: ESL GRP FAB AFX WJG TMO GROW SLE PRSM MRL YU/
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Trading in the royalty partner portfolio over Q1/21 shows a material rebound from May, which has been sustained to date, as the portfolio as a whole returns to more normalised trading. Consequently, Duke's cash receipts, while down 20% YoY currently, are set to step up in H2/21 as forbearance measures largely expire and deferred royalties realised. This bodes well for a rebound in earnings and a return to cash paid dividends. A share price down over 55% since Feb 20, standing at p/book of 0.56x H1/20A's NAV p/s thus appears overdone. We await further clarity on the portfolio before reissuing forecasts, thus leave our recommendation U/R.
Companies: Duke Royalty
Acquisition of Berkeley Burke (Financial Services) Ltd and Berkeley Burke Employee Benefit Consultants Ltd for £2.9m maximum consideration (£1.4m initial plus £1.5m deferred and contingent on revenue hurdles). In addition to the acquisitions announced today, the company has received credit committee approval from RBS International for a new £5.5m acquisition facility, further strengthening the potential for STM’s acquisitive growth strategy. The execution of both the due diligence and the deal itself is impressive in the current climate, and the deal adds £0.3m of PBT in 2021E, with a minimum of £0.6m expected from 2022E. We reiterate our 53p price target.
Companies: STM Group Plc
Opportunities which have presented themselves in the wake of the COVID pandemic have been too good to ignore. Two assets have been acquired for £17m with 5%+ NIY; one having material reversionary potential. An attractive forward funding opportunity has been born out of COVID uncertainty with ULR stepping in to fund the £20m development of two assets pre-let to Amazon and DHL. March’s equity placing has now been fully deployed, and a new £151m loan facility provides additional £40-50m headroom. The structural trend towards e-commerce has been catalysed by COVID. ULR offers exposure to this resilient, attractive segment with a 5%+ yield and potential capital gains from rent reversion.
Companies: Urban Logistics REIT Plc
We believe now is an interesting time to invest in Northgate, with a new executive board and a capable management team in place who have already delivered progress on an ongoing turnaround as we await a full strategic review. The group now has a clear and well communicated capital allocation strategy in place and improved earnings quality, in our view. We believe that the growth opportunity in the UK, the value of the Spanish business and the progress made to date with the turnaround are not being reflected in the share price, which is currently 15.9% below book value (414p per share in FY19A rising to 468p in FY22E). We use a variety of valuation methods including P/B, SOTP, DDM and DCF modelling and arrive at an average implied share price of 450p, 29.0% above the current share price.
Companies: Redde Northgate Plc
For this Monthly, we are delighted that Rooney Nimmo and 24Haymarket have allowed us to reproduce a recent report they jointly published, entitled An analysis of UK exits (2015-2019), which provides a granular analysis by sector of the activity in our dynamic private companies world. We hope you find the insights of interest.
Companies: AVO AGY ARBB ARIX CLIG ICGT NSF PCA PIN PXC PHP RECI SCE TRX SHED VTA
S&U motor finance sales are recovering even as credit criteria have been tightened. There is still uncertainty about the impact of the wind down of employment support schemes and how collections will recover following repayment holidays, but S&U expresses cautious optimism on the latter point. The current year results will be significantly affected by lower sales and higher arrears but management indicates the group is still profitable, is maintaining its high customer service levels and has liquidity headroom to respond once it is sensible to target stronger growth.
Companies: S&U Plc
29 July interims showed a 7.1% EPRA EPS increase, rising NAV and a continued rise in DPS. Illustrating the growth, rents rose 20.4%, and adjusted EPRA earnings rose 29.0%. On 9 July, PHP launched a £120m proposed placing, at a point in the REIT’s development that is underpinned by a strong and broad pipeline. The placing was expanded to £140m as a result of investor appetite. The short-term pipeline stands at £128m, and there is also growth from active management of existing assets. We consider this REIT has significant per share value growth potential, through capital deployment, rent rises and financing cost efficiencies.
Companies: Primary Health Properties Plc
Duke delivered significant YoY growth in H1/20A results, as earlier efforts to broaden the royalty portfolio came through this year. This strong growth will continue with recent debt & equity raises forward funding investments to income levels of £15m by FY21E. Met with an enhanced, but now stabilised cost base, operational leverage should drive continued strong adj EBIT growth (to £13m, at a c85% margin) and further DPS rises.
L&G reported an operating profit from continuing divisions (excluding Mature Savings and General Insurance businesses) of £1,128m, -2.2% yoy. The COVID-19-related cost was £129m. LGR posted a growing operating profit to £721m. Net profit amounted to £290m vs. £874m a year before, being affected by the reduced discount rate used to calculate LGI reserves. The Solvency II ratio stood at 173%. The Board recommended an interim dividend of 4.93p/share, stable relative to H1 19.
Companies: Legal & General Group Plc
Frontier IP has announced it has invested £50k in a £500k convertible loan financing of PulsiV. Frontier IP has a 18.9% equity holding in PulsiV, which was last valued at £0.9m on the balance sheet. Whilst the commercial terms of the loan are unknown, it is not expected to have any material difference to the balance sheet at this stage. This direct investment by the Group is in line with a wider strategy to use proceeds of the recent fundraising to support portfolio companies financially to accelerate portfolio growth. PulsiV is taking significant steps to commercialising its technology and a solar microinverter prototype developed in collaboration with Bosch is expected to move into field trials of the “Engineered by Bosch” product in the nearfuture. Funding will enable PulsiV to step up development of its technology for use in a wider range of industrial applications, at least one of which is nearer to market. The potential of the micro-inverter market is vast, estimates of the global solar inverter market ranges from $2.4bn to $7.3bn per year.* Proceeds are expected to fund the development of its technology into a wider range of industrial applications. We note that PulsiV continue to be in discussions with potential investors to raise further funding in the form of equity, an event outlined in our January initiation as a near-term catalyst for Frontier IP’s valuation of its equity holding. Frontier IP expect this equity fund raise to be at a substantial valuation premium to the current book value of PulsiV (last reported at £0.9m on Frontier IP’s balance sheet). There is no indication given as the size of any potential uplift, but any increase in the Company’s book value will be reflected in the Group’s results to 30 June 2020 financial year. If achieved it would demonstrate that positive momentum from an excellent FY’20 period has continued into the new financial year.
Companies: Frontier IP Group Plc
With 90% of contracted rental income paid directly or indirectly by the UK or Irish governments and the balance primarily coming from co-located pharmacies, rent collection remained robust through H120, contributing to a strong H120 financial performance. Primary Health Properties (PHP) is well on track to meet its fully covered 5.9p (+5.4%) FY20e DPS target, which will mark the 24th year of uninterrupted growth.
We have knitted together the impact on the investment companies from what is now widely considered to be the most severe pandemic in a century. The collapse in asset prices over the latter part of March, brought the curtain down on an up-market that lasted more than ten years. In amongst this, there were pockets, such as the technology sector, that held up well. For many industries, the worst is still to come, as we brace ourselves for the sharpest contraction to global growth since the US great depression.
Companies: ASL SDV ASIT BGEU BRLA CCPE DPA IEM JMF JZCP JUKG EPIC PSHD CSH RIII CCPG BLP TMPL BPCR SEQI AIF SMT CIFU SQNX FAIR ICON RSE CRS GWI USF DIGS
Supply@ME Capital PLC (LON:SYME) offers an innovative technology platform to provide inventory monetisation, which can enable a wide range of manufacturing and trading businesses to improve their working capital position (via a “true sale” of the inventory to special purpose vehicles incorporated b
Companies: Supply@Me Capital Plc
What’s new: Purplebricks Group results for the year to 30 April 2020, show the Australian and US units as discontinued; but include the Canadian unit sold for C$60.5m (i.e. £35m) in July. Investors will focus on the UK unit which revealed:
11% fall in UK revenue to £80.5m (FY19: £90.1m), as the number of instructions fell 23% (impacted by early Covid uncertainty and lockdown), but the average revenue per instruction “ARPI” rose 12% to £1,394;
UK gross profit margin improved to 64.1% (FY19: 63.0%);
UK marketing costs to revenue improved to 25.6% (FY19: 29.6%);
Spend on Digital capacity pushed UK operating costs 32% to £26.2m (FY19: £19.9m), as new management team pursued initiatives which are being “delivered at pace with significant opportunity for further innovation.”
UK adjusted EBITDA fell 53% to £4.8m (FY19: £10.2m).
Companies: Purplebricks Group Plc
The Biotech Growth Trust (BIOG) is managed by Geoff Hsu, who is able to draw on the considerable resources of specialist healthcare investor OrbiMed Capital. While biotech stocks have rallied strongly following the coronavirus-led stock market sell-off earlier in 2020, the manager believes they could have further to go. He is confident that a successful COVID-19 vaccine will be developed and positive fundamentals are supportive for the biotech sector’s future performance. Repositioning of BIOG’s portfolio during FY20 has been accretive to the trust’s returns in recent quarters; it has now outperformed its benchmark NASDAQ Biotechnology index over the past one, three, five and 10 years, and investors have also enjoyed very solid absolute total returns of more than 20% pa over the past decade.
Companies: The Biotech Growth Trust