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AIM 50 Digest 8 October 2021

  • BY: Andrew Hore |
  • POSTED: 12/10/2021 |

Blue Prism (PRSM) has agreed a bid from Vista Equity Partners, but shareholder Coast Capital is not happy. The 1125p a share bid values the robotic software company at £1.1bn. Management says that the bid was the highest on offer and they believe provides better value than maintaining independence. Coast Capital believes that changes can be made to the business to make it more efficient.

Victorian Plumbing (VIC) was one of the many AIM flotations this summer. Its maiden full year trading statement shows 29% growth in revenues. Lancashire-based Victorian Plumbing is an online retailer of bathroom products and demand was strong during lockdowns, but not so good when they were eased in the summer. Underlying EBITDA is ahead of expectations. The maiden results will be announced on 9 December.

Floorcoverings supplier James Halstead (JHD) increased full year revenues by 12% to £266.4m with UK revenues particularly strong. Gross margins did fall but overheads were controlled. Pre-tax profit increased by £7.4m to £51.3m, which was higher than forecast. Net cash was £83.3m. The dividend was raised by 7% to 15.25p a share. Revenues are steady in the first quarter of the new financial year and a modest pre-tax profit improvement is forecast this year.

FW Thorpe (TFW) has acquired a 63% stake in Spanish emergency lighting supplier Electrozemper for €20.3m and this should be earnings enhancing in 2021-22. In the year to June 2021, FW Thorpe increased revenues by 4% to £117.9m, while pre-exceptional profit improved from £15.9m to £18.6m. Net cash was £75.9m. The total dividend increased by 2.5% to 5.8p a share. There is also a special dividend of 2.2p a share.

Electrical accessories supplier Volex (VLX) is acquiring two North American businesses for C$22.5m. The deal adds further manufacturing capacity in Mexico and enhances Volex’s position in the defence market, as well as enabling expansion in off-highway equipment. Combined revenues are C$31.4m and pre-tax profit C$2.4m. A company related to executive chairman Nat Rothschild bought 60,000 shares at 418p each, taking his shareholding to 24.3%.

Fuel cell technology developer Ceres Power (CWR) nearly doubled interim revenues to £17.4m and it is still on course for fully revenues of £31.5m. The order book is worth £42m.

Marketing services provider Next Fifteen Communications (NFC) increased interim pre-tax profit from £20.7m to £35m on revenues one-third higher at £165.9m. Organic revenues growth was 23%. An interim dividend of 3.6p a share was announced. Net cash is £6.6m. Trading momentum has continued into the third quarter, although the comparatives are tougher. Organic growth should still be in double digits in the second half.

At the time of its interim announcement Ergomed (ERGO) stated that its full year results will be better than expected. Interim revenues increased by 48% to £56m, which is a combination of organic growth and an initial contribution from US acquisition MedSource. Interim earnings increased by 49% to 16.8p a share.

Nathan Imlach has bought 132 shares in Mortgage Advice Bureau (MAB1) at 1205p each. This was after MAB reported an increase in interim revenues from £63.5m to £92.4m, while underlying pre-tax profit improved from £7.9m to £11.6m. There is an interim dividend of 13.4p a share. Adviser numbers have increased to 1,800. 

IQE (IQE) is closing its Singapore semiconductor wafer manufacturing site because of lack of utilisation and production will be moved to North Carolina and Taiwan. This will generate annualised cash savings of nearly £5m. Edison has upgraded its 2022 earnings forecast by 8% to 0.68p a share. Group profitability remains subdued and a faster 5G roll out is required for the outlook to improve.

Trading at Gooch & Housego (GHH) was slightly better than anticipated in the year to September 2021. The 2020-21 earnings forecast has been increased by just over 2% to 37.3p a share. There is more to come from the streamlining of manufacturing.

Central Asia Metals (CAML) produced 10,360 tonnes of copper at Kounrad in the nine months to September 2021 and it is on course to achieve the top end of guidance of 12,500 to 13,500 tonnes for the full year. In the same period, Sasa produced 17,033 tonnes of zinc concentrate and 20,734 tonnes of lead concentrate but lead concentrate production will be below previous guidance.

Jet2 (JET2) is buying a further 15 Airbus A321 NEO aircraft on top of the 36 aircraft already on order. The value of the new order is $2bn, even at significant discounts to list price. They will be delivered between 2026 and 2029.

Broker Numis Corporation (NUM) had a better than expected end to the year to September 2021. Revenues increased from £155m to £215m with investment banking revenues nearly as high as group revenues last year. Pre-tax profit is estimated at £66.4m. Trading is still strong, but revenues and profit are likely to fall in the current financial year.

Impax Asset Management (IPX) has increased assets under management at the end of September 2021 to £37.2bn, which is 8% ahead of the previous quarter. There was a combination of net inflows and market growth.

Secure Income REIT (SIR) has collected 100% of rents due between 8 July and 7 October. Only 0.04% of annualised gross rents remain outstanding this year, with deferred rents received in full by the due date.

AFC Energy (AFC) has appointed Peel Hunt as nominated adviser and joint broker. Chief technology officer has acquired an initial 25,643 shares at 44.96p each. Chairman Gary Bullard bought 30,000 shares at 46.3p each.

ASOS (ASC) has appointed Berenberg as joint broker. Peel Hunt has been appointed as joint broker of Renew Holdings (RNWH).

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