News blog

AIM Digest 30 September 2022

BY: Andrew Hore |
POSTED: 02/10/2022 |

Pharma research services provider Ergomed (ERGO) is on course to meet 2022 expectations. First half earnings were one-fifth higher at 20.4p a share. The order book is worth £285m and it is growing at a faster rate than revenues. Full year revenues are forecast to improve from £118.6m to £139.6m, while pre-tax profit is expected to improve from £20m to £22.4m, which is equivalent to 44.5p a share. Nearly two-thirds of revenues are in US dollars, but less than one-quarter of costs.
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Peel Hunt has trimmed its forecast production and revenues forecast for oil and gas producer Serica Energy (SQZ) following the interims. The broker still estimates net cash of £492m at the end of 2022 and around £700m one year later. A maiden interim dividend of 8p a share is being paid.
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Ceres Power (CWR) fell sharply after its interim statement. Revenues and gross margin declined. There is still £221.6m of cash and investments. Licence fee revenues from the China joint venture are likely to be recognised next year. That means that second half revenues will be similar to the first half level.
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Marketing services provider Next Fifteen (NFC) generated organic growth of 31% in the first half and the trading momentum is continuing in the third quarter. The focus on technology clients has helped. The interims have sparked a full year pre-tax profit upgrade from £103.1m to £115m. The bid for M&C Saatchi (SAA) continues and the rival bid has failed. It will be difficult for Next Fifteen to succeed in its bid, though, and this is holding back the share price.
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LBG Media (LBG) is attracting more people to its content, but that is offset by weaker revenues per view and higher costs. The business is second half weighted. Zeus has edged down its pre-tax profit expectations for the full year to £16.5m, up from £14.4m last year. Net cash of £46.1m is forecast. Non-exec Alexandra Jarvis bought 12,492 shares at 79.95p each. LBG Media floated last December at 175p a share.
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Vet practices operator CVS Group (CVSG) increased like-for-like revenues by 8% in the year to June 2022. Peel Hunt has edged up its 2022-23 pre-tax profit forecast from £81.6m to £82.6m, compared with £75.2m last year.
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Mortgage Advice Bureau (MAB1) reported slightly better than expected interim revenues of £96.5m, while pre-tax profit was flat at £11.5m. Earnings fell because of additional shares issued to finance the acquisition of Fluent, but the dividend was maintained at 13.4p a share. Adviser recruitment has slowed. Full year pre-tax profit will be slightly lower than previously anticipated, but they should still improve from £24.2m to around £29m. There were directors buying shares after the interims. Katherine Innes-Ker acquired 735 shares at 650p each, Nathan Imlach 263 shares at 635p each and Mike Jones bought 3,000 shares at 666.96p a share.
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FW Thorpe (TFW) has acquired 80% of SchahLED Lighting in Germany. This should enhance this year’s earnings. The initial payment is £12.8m and more could be paid depending on 2022-23 performance. In 2021, the acquired business generated revenues of Euro15.9m and EBITDA of Euro2.8m.
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Alliance Pharma (APH) reported flat underlying revenues of £81.6m in the first half of 2022 and there was a small decline in pre-tax profit to £19.7m. There were declines in the sales of menopause treatment Ameren and anti-dandruff shampoo Nizoral. Second half trading is likely to improve. Several large orders are anticipated in the fourth quarter.
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Video games services provider Keywords Studios (KWS) increased underlying interim pre-tax profit by 38% to Euro54.8m. Organic growth in revenues was 22%, but the pace of growth is expected to slow in the second half. Keywords is buying Canada-based development studio Smoking Gun for up to C$40m.
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Video games developer Frontier Developments (FDEV) reported a slump in 2021-22 profit due to more than doubling development spending to £46.2m and a write-down of investment in Elite Dangerous: Odyssey. The higher investment in new games should enable Frontier Developments to continue to increase revenues by around one-fifth each year. A 2022-23 pre-tax profit of £19.3m is forecast.
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Gas supplier Savannah Energy (SAVE) reported a 10% increase in interim EBITDA to $100m and the full year outcome could be treble that level, before doubling again next year. The acquisition of assets in Chad and Cameroon should be completed by the end of the year.
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Broker Numis Corporation (NUM) says that its revenues fell by one-third in the year to September 2022. It says challenging market conditions have led to a significant reduction in its deal volumes. However, the corporate finance advisory business performance did offset some of the capital markets decline and M&A business is flourishing.
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Learning Technologies Group (LTG) reported better than expected interims. Acquisitions boosted revenues and improved margins, but there was still organic growth in revenues of 5% - mainly from the software and platforms division.
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Oil and gas producer i3 Energy (I3E) has reached a production rate of 22,000 barrels of oil equivalent per day and it could reach 24,000 by the end of the year. Twenty wells have been drilled this year and all will be up and running by the end of October.
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EMIS (EMIS) announced an unchanged interim dividend of 17.6p a share ahead of its takeover by Optum UK.
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Big Technologies (BIG) chief technology officer Charles Lewinton sold 41,000 shares at 295.1p each. Finance director Daren Morris bought 5,000 shares at 295p each and his daughter 5,000 shares at 296p each. Hatish Desai’s wife bought 4,000 Renew Holdings (RNWH) shares at 664p each and fellow non-exec Stephanie Hazell bought 3,392 shares at 589.5p each. Young and Co Brewery (YNGA) non-exec Aisling Meany acquired 1,289 A shares at 1085p each.

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