News blog

AIM 50 Digest 4 March 2022

  • BY: Andrew Hore |
  • POSTED: 06/03/2022 |

Soft drinks maker Nichols (NICL) increased full year revenues from £118.6m to £144.3m, while profitability recovered from £11.6m to £21.8m. That is still below the level of profit in 2019 and it may be some time before the past level is regained. Vimto retail sales are growing faster than the market in the UK, and it is also growing internationally, particularly in Africa. The Middle East business has adapted to the sugar tax and is holding up. However, the out of home division is still not trading at its previous level and a strategic review has begun. This could involve a restructuring of the cost base and the customer list. The 2021 dividend is 23.1p a share and this is forecast to rise to 26.3p a share in 2022, which would be twice covered by estimated earnings. Net cash is expected to reach £63.2m at the end of 2022 even though Nichols continues with its share buy backs. 
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Revolution Beauty (REVB) has bought the assets of US cosmetics brand BH Cosmetics, which is in Chapter 11 bankruptcy, for $3.9m. Badass with Heart (BH) Cosmetics are vegan and cruelty-free. Revenues fell from $55.8m to $33.7m in 2020 and it is losing money. The business will be integrated this year. Revolution Beauty has signed a three-year agreement with Aquis-quoted Samarkand (SML) will incorporate the cosmetics company’s existing Tmall Global Flagship store via the Nomad technology, which will make it easier to sell in China. Samarkand will be exclusive ecommerce partner for China.
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Online marketing company Dotdigital (DOTD) grew interim revenues by 10% to £30.9m, but growth is becoming more difficult to achieve, particularly in the Americas. Monthly revenues per client increased by 19% to £1,422 and investment in new services can help this to continue to increase. There has been less SMS usage than during the Covid-19 lockdown, while recruiting staff has been a problem. Full year pre-tax profit is likely to be flat at £13.6m.
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Following remedial work at Theta West #1 Alaska-focused oil and gas explorer Pantheon Resources (PANR) is ready to test the well. There is potentially 1,401 million barrels of oil at Theta West. The Alkaid #2 well will be drilled in the summer.
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Aquaculture products supplier Benchmark (BMK) had a strong first quarter with the health division making a positive profit contribution following the launch of Ectosan Vet/ CleanTreat. There were also strong sales of shrimp breeders. Overall, first quarter revenues were 38% ahead at £40m, although there is still a loss after interest charges. Net debt is £64.3m.
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Marketing services provider Next Fifteen Communications (NFC) has acquired PR and marketing firm Engine UK for a total enterprise value of £77.5m. In 2021, Engine UK increased revenues by 18% to £88.6m and EBITDA was £11.8m. There should be annual cost savings of £3m and the deal will be earnings enhancing in 2023-24. A placing raised £50m at 1110p a share to help fund the deal. Subsidiary Mach49 has gained a five-year strategic alliance with a global technology company. Total fees will be more than $400m. This led to a change in contingent consideration for Mach49, which will be capped at $300m with 85% payable in cash and that should be funded from Mach49’s cash flow.
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RWS (RWS) is trading in line with expectations with a weak performance from IP services offset by better performances elsewhere. 
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Victorian Plumbing (VIC) says revenues fell by 3% in the first four months of the financial year and comparatives will begin to ease. Costs are increasing and some are being absorbed by the retailer so margins will be hit.
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Oil and gas producer Serica Energy (SQZ) has temporarily shut down Rhum production because of a fault. It is unlikely to resume until mid-March. Serica’s other producing fields are not affected, and they are producing 10,000 barrel of oil equivalent per day.
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FD Technologies (FDP) has announced plans to embed KX Insights on the Microsoft Azure platform. They will work together on developing a capital markets product.
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AFC Energy (AFC) has agreed to deploy its first hybrid fuel cell system in Cadiz, Spain. This is in conjunction with partner ACCIONA. Roman Abramovich still has a stake in AFC.
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Clinigen (CLIN) will be leaving AIM when the takeover of the pharma services company completes in early April. Clinigen reported a 10% increase in interim sales to £238.1m and underlying earnings fell from 26.4p a share to 22.6p a share. The acquisition of robotic software company Blue Prism (PRSM) should also be completed in the next few weeks.
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New chief executive Americo Lemos has invested £148,666 in IQE (IQE). The shares were acquired at 38.44p each. John Mansell has bought 50,000 Polar Capital (POLR) at 576p each, while fellow director Jamie Cayzer-Colvin bought 30,000 shares at 550p each. Four directors of Imapx Asset Management (IPX) has each bought 6,000 shares at prices ranging from 848p to 939p. Lindsell Train has increased its stake in Fevertree Drinks (FEVR) from 5.25% to 10%.

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