Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Nasstar. We currently have 38 research reports from 4 professional analysts.
Netcall* (NET): Strong trading update (CORP) | Sopheon* (SPE): Another strong trading update (CORP) | Nasstar* (NASA): positive trading update (CORP) | Utilitywise* (UTW): Temporary suspension of trading (CORP) | Altitude* (ALT): Positive progress (CORP)
Companies: NET SPE NASA UTW ALT
Hydrominer GmbH, An Austrian cryptocurrency miner, is considering an initial public offering (IPO) on the London Stock Exchange AIM during 2018 according to an article on Bloomberg. Block Energy—a NEX Listed UK based oil exploration and production company whose main country of operation is the Republic of Georgia, looks to join AIM end of February 2018. Offer TBC OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Offer raising £30m at 165p with market cap of £100m . Due 9 February.
Companies: HER HYR IME EZH ANP NASA WAND FIPP FISH DPP
See what's trending this week...
This quarter we use finnCap’s Slide Rule to provide both top-down and bottom-up analysis of the UK’s Technology and Telecoms sectors. Our findings are very reassuring: the Tech sector scores the best (across all sectors) when considering Growth and Quality – Taptica*, Frontier Developments* and dotDigital* in particular stand out on these metrics. Given these attractive characteristics and growth prospects, the Tech sector is unsurprisingly one of the most expensive – currently trading at 17.2x FY1 EV/EBIT and 23.8x FY1 P/E, versus 15.0x and 18.5x respectively for the wider market. Despite valuations appearing high, we believe there are value opportunities. For example, Proactis* features in finnCap’s QVGM+ portfolio (ranked 17/462) – the company offers attractive organic and inorganic growth, with earnings forecast to grow by 26% CAGR over the next two years, but despite this, only trades on 15x FY1 earnings and offers 8% FCF yield in FY2.
Companies: 7DIG ALT AMO ARTA BOTB BLTG CTP CITY D4T4 DTC DOTD ELCO ESG FDEV GBG IDEA IDOX IMTK IGP IOM KBT KCOM KWS LRM MAI MMX NASA NET PHD QTX QXT RCN 932 SSY SEE SIM SPE SRT STR TAP TAX TEP TPOP TRAK UNG VIP ZOO CYAN ONEV
Castleton Technology* (CTP): Strength evident in execution (CORP) | Paragon Entertainment* (PEL): Trading update (CORP) | Ideagen* (IDEA): Interim trading update (CORP) | Horizonte Minerals* (HZM): Araguaia mine plan submitted to National Mining Agency (CORP) | Nasstar* (NASA): Contract win (CORP) | Intercede* (IGP): Contract slippage (CORP)
Companies: CTP PEL IDEA HZM NASA IGP
Clean Invest Africa—Introduction due around 14 Nov. Vehicle established to identify investment opportunities and acquisitions in renewable and clean energy projects/companies or alternative technologies that are used in a socially and environmentally responsible way that will aid the development of the African continent. City Pub Group - owner and operator of an estate of 34 premium pubs across Southern England. £30m raise. Consistent track record of strong revenue and EBITDA growth, with a three year CAGR from FY14 to FY16 of 34.9% and 44.8% respectively, and an EBITDA margin of 14.7% in FY16. Due Nov. Boku - Independent direct carrier billing company. Revenues were up 21% to US$10.2 in HYJun17. Q32017, revenues grew to $6.5m, up by 44%. The Company also saw continued growth across all of its key metrics: user numbers, total payment and a positive adjusted EBITDA for the month of September 2017. Due 20 Nov. Offer TBA. Ten Lifestyle Hldgs. Technology-enabled lifestyle and travel platform providing trusted concierge services to the world's wealthy. Net revenue increased from £20m in the year ended 31 August 2015 to £33m in the year ended 31 August 2017, a compound annual growth rate of 29%. Offer and date TBA. AfriTin Mining—Demerger from Bushveld Minerals (BMN.L). Offer TBA. Due 8 Nov. The Uis Tin project (Namibia) is considered the flagship tin asset within the portfolio, as this was once the largest open cast tine mine of its kind in the world. Expected 8 November 2017 OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Expected valuation £200m to £250m. OG Graphite, brownfield development-stage graphite company focused on the reactivation of its wholly-owned Kearney natural flake graphite mine and mill located 280 km north of Toronto, Canada. Offer TBA, expected mid November.
Companies: AVAP NASA WAND TYMN LION FEVR IDEA NCYT GGP
Nasstar has delivered interims in line with unchanged expectations. Growth in monthly recurring revenue run rate (+46% year-on-year, +8% organic year to date) to £1.8m demonstrates the visibility and resulting quality of the mode, while the Nasstar 10-19 initiative has already delivered EBITDA margin improvement to already achieve our full-year margin expectation of 22% (FY16: 20.1%). Cash flow is strong, with working capital normalised, generating £1.8m free cash from £1.5m adjusted PBT, exceeding free cash generation for the whole of FY16. Management has demonstrated a tick-box delivery of investor expectations. Target 13.0p reiterated.
Independent Oil & Gas* (IOG): Pieces falling into place (CORP) | Elektron Technology* (EKT): Further strategic progress (CORP) | Elecosoft* (ELCO): A good H1 is driven by ICON and FX (CORP) | Hurricane Energy (HUR): Lancaster EPS approved (BUY) | Hurricane Energy (HUR): Lancaster EPS approved (BUY) | Hurricane Energy (HUR): Lancaster EPS approved (BUY) | Nasstar* (NASA): Growth and efficiency (CORP) | SRT Marine Systems* (SRT): Loan notes will fund satellite data project (CORP) | Trifast^ (TRI): Trading update, progress in line with expectations (BUY)
Companies: IOG EKT ELCO HUR ZOO SAV NASA SRT TRI
LoopUp—The provider of conference calls and online meetings is seeking to join AIM. 2015 revs of £9.2m and EBITDA of £1.02m | Bacanora Lithium— To list on AIM around 28 Sep as holding company for TSX listed Bacanora Minerals at £100m market cap | Aura Energy—ASX listed uranium developer (ASX:AEE) expected to join AIM 6 September | Autins Group plc - The acoustic and thermal insulation specialist now looks to join AIM late August
Companies: MSG PEN EOG NASA THR UVEN AOR NAK EDL SRES
Nasstar* (NASA): Trading update (CORP) | Solid State* (SOLI): Initiation of coverage: Intention to double revenues in five years (CORP) | Mortice* (MORT): Further strong growth (CORP) | Petra Diamonds (PDL): Trading and guidance update (BUY) | The Mission Marketing Group* (TMMG): Positive trading update (CORP) | Connect (CNCT): In line but with a different mix (BUY) | Quixant* (QXT): Strong H1 performance underpins FY forecasts (CORP)
Companies: NASA SOLI MORT PDL TMMG CNCT QXT
Xpediator Plc—Sch 1 from the holding Company for an integrated freight management business operating in the supply chain logistics and fulfilment sector across the UK and Europe with a strong presence in Central and Eastern Europe. Offer details TBC, expected Admission early August 2017. GetBusy PLC—Sch1 from the holding Company of its subsidiary undertakings, which operates as a document management software business, headquartered in Cambridge, UK and operating across the UK, USA, Australia and New Zealand. Capital to be raised via a rights issues of £3m at 28.3p with anticipated market cap of £13.7m, Admission 4 August. Quiz—Sch 1 from the omni-channel and international own brand in the women's value fast fashion sector. Offer raising £102.7m at 161p, expected market cap £200m. Expected 28 July. Last year Quiz posted sales of £87.4m while pre-tax profits grew by 17pc to £5.7m. Arena Events Group -provider of temporary physical structures, seating, ice rinks, furniture and interiors. Raising £60m. Mkt cap £63m. Expected on the Chef’s birthday, 25th July. Altus Strategies—African focused natural resource Company. Offer TBC. Expected Early August. Harvey Nash Group— Provider of professional recruitment and offshore solutions moving to AIM from Main, 8am 28 July 2017. No capital to be raised. Mkt Cap c. £57.8m. Greencoat Renewables - Schedule 1. Targeting a portfolio of operating renewable electricity generation assets, initially investing in wind generation assets in Ireland. Offer raising €270m at €1 with expected market cap of €270m. Due 25 July 2017. I3 Energy –Schedule 1 Update. Independent oil and gas Company with assets and operations in the UK. Issue price of 55p with anticipated market cap of £14.3m, 25 July Admission. Verditek— Sch 1 update. The Company's subsidiaries will be involved in advanced solar photovoltaic, filtration and absorption technologies specialising in providing environmental services. Issue price 10p. Admission late June. There has been no official update here for a while. Hipgnosis Songs Fund investment Company offering pure-play exposure to Songs and associated musical intellectual property rights. Offer raising £200m at 100p. The Company has decided to extend the closing date for the Placing, Offer for Subscription and Intermediaries Offer to 1 August 2017. The Company may bring forward this closing date at any time. Admission 4 August 2017
Companies: TPG NASA CROS IXI QXT EMAN BIOM MYT GROW ASA
I3 Energy –Schedule 1. Independent oil and gas Company with assets and operations in the UK. Offer TBC, 26 May admission. | Opera Investments –Reverse Takeover of Kibo Mining’s subsidiary Kibo Gold. Raising £1.5m. Expected mkt Cap £6.5m. 23 May. | Eve Sleep—Schedule 1 from the e-commerce focused, direct to consumer European sleep brand. Raising £35m at £1.01. Expected mkt cap £140m. Expected 18 May 2017. | Velocity Composites—Schedule 1. Manufactures advanced carbon fibre and ancillary material kits (predominantly carbon fibre) for use in the production of aircraft. 18 May 2017 admission expected. Raising £14.4m at 85p. Expected mkt cap £30.4m. | Verditek—Schedule 1 update. On Admission, the Company's subsidiaries will be involved in advanced solar photovoltaic, filtration and absorption technologies specialising in providing environmental services. Issue price 10p. Admission in late May. | AEW UK Long Lease REIT—Intention to Float. Up to £150m raise. Admission early June. UK specialist and alternative property | Alfa Financial Software –Intention to float. Mission-critical software platform purpose-built for asset finance enterprises. Vendor sale of 25% plus. FYDec16 rev £73.3m (CAGR of 24% from 2012). Adjusted EBIT £32.8m. | Kuwait Energy— $150m raise plus vendor offer. Admission due June. 2p reserves 810.0 mmboe | ADES International— Provider of offshore and onshore oil and gas drilling and production services in the Middle East and Africa, seeking raise up to $170m plus vendor sale under a Standard Listing of the Main Market. Admission due May 2017. | Tufton Oceanic Assets– Extended to 9 May on specialist funds segment of Main Market to enable further due diligence. | PRS REIT—Private rental sector REIT raising up to £250m. Admission due 31 May.
Companies: LND NASA ATQT CNS INL SOU ALT PURE WRES REDS
Venture Capital Trusts (VCTs) raised £542m in the 2016-17 tax year, which is the second-highest amount in a single year. Specialist AIM VCTs had particularly successful fundraising efforts, with some closing their offers well before the end of the tax year, so this is good news for AIM companies seeking investment. Unicorn AIM VCT had already raised the £15m it was seeking by early February. The cash raised was 18% higher than the £458m raised in the 2015-16 tax year. Restrictions on pension investment have led investors to seek other ways to invest for the longer term. The highest amount raised in one tax year was in 2005-06, when £779m was raised but the income tax relief rate was 40%, rather than 30% as it is currently. There are £3.9bn of VCT assets under management. There are other new sources of finance for smaller companies. Downing Strategic Micro-Cap Investment Trust raised £54.5m after expenses. This is not a VCT but it is another potential investor for small companies with a market value of less than £150m. Many of these will be too large to be qualifying investments for VCTs. Downing is likely to take significant stakes because it is aiming to have a portfolio of between 12 and 18 investments.
Companies: NASA RFX MTFB EPWN FISH REDS
As tax losses are now expected to be exhausted in 2017, we have reviewed adjusted diluted EPS back to 2014 from cash tax basis to normalised tax basis, with no change to other forecasts or the EBITDA-based target price. The combination of organic and acquired growth is complemented by renewed focus on margin maximisation, leading to the expected return to net debt/cash breakeven by FY17. Balance sheet capacity offers continuing strategic growth opportunities, organic and acquired and confidence for dividend growth to be accelerated into FY18. With growth in revenue, margins and cash, and enviable visibility leading to high earnings quality and a strong FY17 free cash flow yield, we reiterate our 13p target price.
Finals report performance in line with expectations and the January trading update. EBITDA of £3.8m (£3.8mE) was delivered from revenue of £18.7m (£19.2mE), 88% recurring at a year-end monthly run rate of £1.8m (+54% vs FY15, 8% organic). The combination of organic and acquired growth is complemented by renewed focus on margin maximisation, leading to the expected return to net debt/cash breakeven by FY17. Balance sheet capacity offers continuing strategic growth opportunities, organic and acquired and confidence for dividend growth to be accelerated into FY18. With growth in revenue, margins and cash, and enviable visibility leading to high earnings quality, we reiterate our 13p target price.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Nasstar. We currently have 38 research reports from 4 professional analysts.
|19Mar18 16:26||RNS||Holding(s) in Company|
|15Feb18 17:09||RNS||Holding(s) in Company|
|29Jan18 07:00||RNS||Trading Statement|
|15Dec17 07:00||RNS||Director/PDMR Shareholding|
|29Nov17 13:41||RNS||Director/PDMR Shareholding|
|07Nov17 07:00||RNS||Significant Contract Win|
|25Sep17 07:00||RNS||Interim Results|
WANdisco’s co-sell agreement with Microsoft is possibly the company’s most important partnership to date, strengthening the company’s already enviable platform to capitalise on the rapid growth in cloud and hybrid cloud computing. Agreements with IBM, Alibaba, Dell/Virtustream and now Microsoft give a clear indication of the capability and uniqueness of Fusion. Near- and long-term prospects are reinforced as is the potential for WANdisco to grow into and exceed the current rating.
Bango has announced FY17A results ahead of our forecasts, with financial performance once again demonstrating strong growth and platform scalability. Momentum remained strong during the year, with End User Spend (EUS) confirmed as having more than doubled but opex having grown by just 13%. The positive outlook statement will give confidence in the near-term financial performance. Our FY18E adjusted earnings estimates are unchanged following the release and FY19E forecasts are introduced for the first time.
The 2017 performance built strongly on 2016, with Clareti y-o-y revenue growth of 48% driving 40% growth in adjusted PBT even as the group continued to invest in the business. The balance sheet is strong providing flexibility and options and the Board also recommended initiating a dividend (0.5pps), signifying confidence. We upgraded our revenue growth expectations for Clareti (expect +38% in 2018 and +27% in 2019). We believe Gresham’s continued momentum reflects a positive demand environment, a highly competitive and differentiated product set and a strong management team that will continue to drive shareholder value.
Companies: Gresham Technologies
Having shown some signs of stability, markets have fallen over the last fortnight, due, in part, to concerns over potential trade tariffs which does not augur well. As the marathon of company results runs on, the majority have been as anticipated and will provide us a better insight into the outlook for corporate UK generally. However, the problems facing some retailers are clearly apparent. We have also continued to see significant M&A activity. In Share News & Views, we comment on APC Technology*, Hunting, James Fisher and Sons, PCF Group*, Ricardo and Swallowfield.
Companies: APC BMS CRPR ECSC EUSP FDM GETB PCF SNX SPRP TCN W7L
We have spoken to R1 and we are revisiting the buy case by addressing some of the questions impacting the shares. With 3 significant deals in last 12 months the market is looking for evidence of underlying performance and successful integration of these deals. As a result it is, in our view, looking at historic numbers, rather than the 2019 and 2020 forecasts. We see significant cash flow potential going forward, and the potential for a significantly enhancing buy back. We believe RhythmOne itself is increasingly vulnerable to the industry roll up, from Private Equity or another industry player, given the very low forecast cash multiples it trades on. We retain our Buy rating and 770p price target.
Pharmaceutical Services is a vast and varied landscape, reflecting the complexities in the discovery, development, manufacturing and monitoring of drugs and devices, all within a stringent regulatory environment. The overall growth prospects are highly favourable: drug development activity globally is on the up, led by smaller companies, which is driving demand for outsourced services. In this report we provide a breakdown of the sector into its main activity segments, and identify biologics, increasing service specialisation and consolidation as important value drivers. Finally, we present 15 companies (9 of which are publicly listed) that, in our view, are well placed to benefit from the sector’s secular growth trends.
Companies: ABZA BQE CSRT OXB INS UDG CLIN ABZA HZD ERGO
StatPro has reported FY 2017 revenues and Adjusted EBITDA in line with expectations reflecting solid growth from Revolution and a positive EBITDA contribution from Delta. Reported revenue increased by 26% at constant currency rates (CCR), adjusted EBITDA was up 24% while adjusted EPS grew by 74%. The dividend is maintained at 2.9p. Group Annualised Recurring Revenue (ARR) increased by 35% to £53.04 million. The acquisition of UBS Delta in April 2017 was a key feature of the year and its integration into Revolution continues. The announcement flags a restructuring of the business in 2019 into three divisions to allow management focus on the specific growth opportunities in the business lines. CEO Justin Wheatley says that StatPro ended 2017 strongly and that the Group expects to see further organic revenue and profit growth in 2018. StatPro has started the current financial year in line with management expectations. We make minor adjustments to our FY 2018E estimates and introduce FY 2019E numbers.
Companies: Statpro Group
In the March 2018 edition of the Hardman Monthly Newsletter, Nigel Hawkins addresses the attractions of quoted infrastructure funds that maintain a low profile.
Companies: OPM ABZA AVO AGY APH ARBB AVCT BNO BUR CMH CLIG COS DNL EVG GTLY GDR INL MCL MUR NSF OBT OXB PPH NIPT PHP RE/ REDX SCLP SCE SIXH TRX TON VAL
Momentum has continued in H2, such that the company now expects FY18E sales and EBITDA (of at least) $28.0m (prev: $26.0m) and $2.3m (prev: $2.0m), implying impressive y-o-y growth of 70% and 31% respectively. In view of this update, we upgrade our FY18 forecasts (sales: +8%, EBITDA: +16%) but make n/c to FY19E. Having said this, given our forecasts now imply just 14% sales growth in FY19, we believe there is a strong likelihood of future upgrades. ZOO remains one to watch.
Companies: Zoo Digital Group
IQE is a leading global supplier of advanced semiconductor wafers that are used in various applications ranging from mobile communications to industrial power. The company boasts a diversified global customer base and a unique IP portfolio with over 150 patents that enables the firm to provide a unique service to its customers. Headquartered in Cardiff, Wales, IQE shares were often misunderstood or underappreciated by investors in the past. However, as the company continued to deliver healthy growth winning volume contracts for new technologies (e.g. VCSEL), the share price nearly tripled in 2017 and the company successfully placed new shares raising £95m in November. Recent reports published by funds with short positions questioning IQE’s accounting with regard to profit and cash flow contribution from its joint ventures sent the stock price down by 45% from its November high. That said, the company rejected the allegation with the statement saying that the information in the short sellers report is “either factually inaccurate or has previously been disclosed in IQE’s annual reports and financial statements”. The company also appointed KPMG as a new auditor replacing PwC as of 12th February saying “the company holds itself to the highest standards of transparency, governance and integrity”. We find the management responses were timely and expect the share price to be stabilised going forward.
Frontier Smart’s FY’17 results show a strong year of growth with excellent cash generation, as flagged in January. Group revenue grew 28% to £41.0m while adj. EBITDA grew 171% to £1.9m (N+1Se: £1.8m). Both divisions performed well, with Digital Radio boosted by the FM switch-off in Norway and Smart Audio recording its first material revenues in the year. Strong free cash flow of £4.2m resulted in net cash at the year end of £3.0m (N+1Se: £1.7m). We make no material changes to our forecasts and continue to expect the group to benefit from rapid growth in the 3rd party Smart Audio market. Our intrinsic value range of 191p – 242p offers plenty of upside, with potential for further value creation as the Smart Home market establishes itself.
Companies: Frontier Smart Technologies Group
In our second edition of “Trend spotting” we note how in the last three weeks the defensive rotation trend has gathered pace and further evidence has emerged of the “relative fading” in the UK economy. However we now see early signs of the “risk on” trend starting to reassert itself in equity markets and we look at small cap laggards plus European exposure as ways to play this.
Companies: GNS NTG SPH TRI XAR BOY VCT GHH CHH DPH INS HILS RPS LWB EKF UDG SYNT MYSL IMO BCA JUP KMK
On the back of the recent extremely positive newsflow, the group has raised an additional A$61m from equity to accelerate the development of the technology product and platform, expand global infrastructure and provide working capital headroom. Crucially, the contract award from a second OEM demonstrated that Seeing Machines (SM) has a credible DMS solution for the global automotive industry and is likely to win a significant share of a huge global market. Equity investors are now beginning to appreciate the scale of the opportunity and the true value of this business. To date, enthusiasm and valuation have been tempered by a relatively heavy investment programme for AIM and an obvious funding gap with likely dilution. We adjust our forecasts to reflect the post-placing investment; however, it clears that final hurdle and opens a path for SM to achieve its remarkable potential. We also highlight upside from a potential re-rating.
Companies: Seeing Machines
Elecosoft has released a trading update for its financial year to the end of December 2017. Revenue and PBT are expected to be ‘significantly higher’ than 2016 and in line with market expectations. We make no changes to our estimates ahead of the final results which are scheduled for March. This suggests that Elecosoft built on a robust set of H1 numbers and maintained momentum during the second half of the year. As at the half year mark, the Group noted the positive influence of exchange rate movements. Management comments that the unified branding was well received by the market during the year. In addition, the focus of the sales strategy on acquiring new direct customers has underpinned the strong trading performance during 2017. Training and support for customers has continued to produce new customer wins and high retentions. ICON has been a useful contributor. In all, the announcement suggests that Elecosoft has continued to benefit during the second half of 2017 from the clear progress which drove a strong performance in H1. The Group remains well-positioned in an attractive market.
In today’s more detailed trading update, Sopheon has confirmed its brief statement in early January that revenue and profit for FY 2017E will exceed market expectations. As well as providing an anticipated revenue figure above U$28 million, it states that both EBITDA and pretax profits will be ‘significantly ahead of current market expectations.’ Today’s update notes that volume of transactions increased with a greater number of license deals and new SaaS customers – and Q4 contained two substantial deals. Sopheon ended 2017 with net cash of U$9.5 million. The group has a higher recurring revenue base and greater revenue visibility overall. We adjust FY 2017E numbers to reflect the guidance given today, driving a 31% increase in our Adjusted EBITDA estimate to U$6.9 million. We also adjust estimates for December’s conversion of loan stock and that is the only influence on our estimates for subsequent years where we retain a conservative stance and note future investment in the Accolade platform. We will look to revisit those estimates when further detail is available at the time of the results announcement.