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Primary Health Properties PLC
Primary Health Properties - Resilient growth set to continue

With its properties performing an essential role in the fight against the pandemic, and with 90% of rents paid directly or indirectly by governments, Primary Health Properties’ (PHP’s) portfolio was extremely resilient in FY20. DPS growth was uninterrupted due to consistently strong operational cash flows, and after a Q1 DPS increase of 5.1% in the current year, PHP is in its 25th year of unbroken dividend growth. With capital values also benefiting from a flight to quality, the FY20 total accounting return was 10.1%.

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  • 05 Mar 21
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Georgia Capital Plc
Georgia Capital - Solid positive revaluations in Q420

Georgia Capital (GCAP) posted a 27.2% NAV total return (TR) in local currency terms in Q420 on the back of solid valuation uplifts across all key portfolio holdings. This, together with the Q320 revaluation of GHG after it was made private (see our initiation note for details), offset the weak performance of GCAP’s hospitality and commercial real estate business and the subdued share price performance of Bank of Georgia in 2020. Consequently, GCAP’s FY20 NAV TR reached 2.7% in local currency (though -13.3% in sterling terms). The NAV uplift helped reduce GCAP’s loan-to-value (LTV) at the holding level from 44.1% at end-March 2020 to 28.9% at end-2020. GCAP’s new investments remain centred around renewable energy and education.

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  • 05 Mar 21
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Shield Therapeutics Plc
Shield Therapeutics - Accrufer coming to America

Shield Therapeutics (STX) has placed c 83m shares at a deep discount (30.0p/share) to the market price, resulting in a gross raise of £25m. The funds will be utilised to support the US launch and commercialisation of Accrufer (iron deficiency), and thus clarify the strategy in this territory for its key asset. STX will now focus on establishing its US-based operations ahead of imminent launch of the product (launch stocks are ready to be shipped). Our higher valuation reflects the retention of full economics vs our prior out-licensing assumption, and we now forecast STX launch in the US in Q221 vs 2022 previously. Following the raise, the main risk relates to sales execution. However, we see significant upside given that the current share price fully discounts the US opportunity. We value STX at £471.4m.

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  • 05 Mar 21
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Norcros plc
Norcros - Revenue rebound has accelerated in H2

An upbeat trading statement (for the four months to 7 February) points to very strong like-for-like revenue growth in both the UK and South Africa. Higher volumes and revenues most likely with an improving mix are all supportive of rising profitability and margins. Our FY21 PBT estimate is now c 16% higher and consistent with updated guidance. We have also increased subsequent years modestly. Gaining market share and virtually de-gearing the business in the last year are notable group achievements.

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  • 05 Mar 21
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SIGA Technologies Inc (SIGA:NYSE)SIGA Technologies Inc (SIGA:NAS)
SIGA Technologies - Protection against a future pandemic

SIGA Technologies is a commercial-stage company focusing on health security. Its lead program is oral TPOXX (tecovirimat), which was approved by the FDA in 2018 for the treatment of smallpox and is active against all orthopoxviruses. Importantly, in 2018 SIGA was awarded a 60-month contract (with options to extend to 2028) of up to $602m from the US Biomedical Advanced Research and Development Authority (BARDA), the majority of which was for the procurement of the oral version of TPOXX.

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  • 05 Mar 21
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CentralNic Group Plc
CentralNic Group - Strong FY20, carrying momentum into FY21

CentralNic delivered FY20 revenues of US$241.2m, a 121% y-o-y increase (FY19: US$109.2m). Adjusted EBITDA rose 71% to US$30.6m (FY19: US$17.9m), supported by the acquisitions completed in FY19 and FY20 and led by growth in Monetisation. On a pro forma basis, adjusting for the Codewise acquisition, the group delivered 9% organic revenue growth in FY20. In FY21, the group has already completed two acquisitions (SafeBrands and Wando) and secured €60m of additional bond headroom from shareholders, of which €15m has been placed to fund Wando and future M&A deals. On the basis of the strong FY20 results, with the group trading in line with management’s expectations ytd, we have updated our forecasts. The valuation continues to look attractive versus peers.

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  • 05 Mar 21
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