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Headlam Group

H117 results

H117 results confirm Headlam is tracking in line with our revenue forecasts and current trading supports our top-line assumption of 3% growth in FY17. Returns are being supported by a focus on efficiencies in the business providing firming gross margins; gross margin of 31.1% (+103bps) in H117 is notable and provides scope for the group to challenge our earnings growth assumptions on the upside if maintained in H217. The group is committed to a progressive dividend policy including potential special dividends and the shares are yielding around 6.2% inclusive of our forecast of a further 10p special being declared in respect of FY17. We believe current levels provide an attractive entry point.

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  • 21 Aug 17
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Palace Capital

Make it York

Palace Capital has announced it has been granted planning consent subject to conditions by the City of York Council for the redevelopment of Hudson House. Management has not yet decided how to best take the project forward and is exploring all options which maximise shareholder value, with the least amount of risk. Suffice to say management is likely to extract the most value possible for investors. The carrying value of Hudson House is £14.9m and while it is still early days it seems likely that this will be revised upwards at the next revaluation date at the end of September. H1 results will be announced in November.

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  • 18 Aug 17
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Hunting

Recommendation downgrade to Reduce

Hunting is a well run company with a strong suite of proprietary products and a healthy balance sheet, and this year it has returned to positive EBITDA. The company has played a difficult hand well over the course of the industry downturn, and we expect continuity under new CEO Jim Johnson. We are of the view that significant further improvements in financial performance will be required in order to support current share price levels, however. This will require recovery in Hunting’s offshore business, which we in turn expect to require further oil price recovery, to levels over US$60/bbl. We do not believe this is likely short-term, and think it more probable that the H1 results next week remind the market of Hunting’s current position. We believe this will put downward pressure on the shares over the coming weeks, and we move our recommendation from Neutral to Reduce, setting a 380p price target.

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  • 17 Aug 17
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Jersey Oil And Gas

Verbier well spud

JOG has announced the spud of its Verbier well (JOG 18%) by JV operator Statoil, using the Transocean Spitsbergen rig. The well is expected to take between 30 and 70 days to drill: the top end of this range would be the result of drilling a side track, which would be considered on success in the initial well, and as such there could be an initial result as early as mid September.

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  • 14 Aug 17
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Palace Capital

Royal investment returns

In the last four years, Palace has grown the value of its portfolio of regional property from £2m to over £200m, through a combination of astute acquisitions and an active management strategy that has delivered sector-leading growth in NAV/share of 103%. With recently completed and ongoing asset management initiatives at several of the group’s larger properties, we believe that there is significant scope to improve future income and capital values. Standing at a 14.2% discount to NAV/share and offering a 5% yield, the shares are attractively valued on an absolute and sector relative basis.

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  • 10 Aug 17
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Scapa Group

$10m industrial acquisition

Scapa has announced that it has acquired Markel Industries for a total purchase price of $10m, which will be funded from existing cash reserves and bank facilities.

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  • 09 Aug 17
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