Bushveld to receive $30m to increase capacity at Enerox

Liam Roche
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Bushveld to receive $30m to increase capacity at Enerox

Bushveld to invest $7.5m of its own money

Bushveld Minerals (LON:BMN), a vertically integrated primary vanadium producer, announced on Thursday that a group of investors in Enerox GmbH will allocate $30m to ramp up its annual production capacity to 30MW (120-240MWh) by 2022.

The AIM-listed company said its portion of the investment stands at $7.5m, having paid $5m this week and with the remainder to follow in April.

Bushveld also confirmed it pocketed $8.8m from selling off some of its holding in Invinity Energy Systems.

Bushveld chief executive Fortune Mojapelo commented on the company’s wider strategy:

“Investing in VRFB manufacturers is a part of Bushveld Energy’s strategy, designed to play a catalytic role in mobilising third-party capital to assist VRFB manufacturers scale up of sales and manufacturing capacity in order to meet the fast-growing demand for long duration energy storage solutions.”

“The sell down of our Invinity stake is no reflection of any diminishing faith in the potential of the company,” said Mojapelo.

“We are proud of its achievements and continue to cooperate on other topics, including vanadium supply, vanadium electrolyte rental and the overall growth of the VRFB industry.”

“Our decision is rather informed by our conservative capital allocation strategy across the group, which focuses resources on our mining and processing operations and seeks to place Bushveld Energy on a path to self-fund its future plans,” he added.

US jobless claims rise as country continues to reopen

Liam Roche
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US jobless claims rise as country continues to reopen

Virginia and Kentucky see the biggest rise in claims

New claims for unemployment benefits increased by 719,000 in the US last week while remaining around pandemic lows as the vaccine roll-out gains momentum and shops across the country reopen.

This marks an increase of 61,000 in jobless claims for the week ending 27 March, according to the US labour department. The figure comes in below economists’ expectations of 680,000 claims.

A week ago, 658,000 initial claims were registered, the fewest since the beginning of the pandemic.

The figures also demonstrated a narrowing in claims for federal pandemic unemployment assistance of 4,112 in claims to 237,025. This scheme allows gig workers and the self-employed to get assistance.

Among the states that saw the biggest jumps in applications – up by 30,696 and 15,869 claims – were Virginia and Kentucky respectively. Ohio saw the biggest drop.

In early morning trading the S&P 500 is up by 0.66% to 3,999.62 as US stocks held steady following the news.

Joe Biden has been striving to expedite the distribution of vaccines as well as eligibility for people to receive them. This, combined with many states easing lockdown restrictions, has led to an upturn in hiring.

Last week Biden confirmed in his first press conference as president that he had doubled his administration’s vaccination target to 200m during his first 100 days in office. He has also promised that 90% of US adults would be eligible for a jab by 19 April.

So far, in excess of 150m vaccine doses have been given out in America.

In addition to his $1.9trn stimulus plan, Biden also announced a $2tn infrastructure plan to provide additional support to the economy as it recovers from the effects of the pandemic.

The figures on jobless claims precedes Friday’s nonfram payroll report, which it is anticipated will show that 647,000 jobs have been added to the US economy, along with a fall in unemployment to 6%.

Wey Education share price jumps amid talks of £70m takeover

Liam Roche
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Wey Education share price jumps amid talks of £70m takeover

Wey share price up by 43.1%

Wey Education (LON:WEY), the AIM-listed online teaching group, has seen its stock jump up on Thursday as it reached an agreement to be taken over by Inspired Education Online which has valued the business above £70m.

Inspired Education Online, founded in 2013, owns 60 private pay schools across the world in addition to its online business King’s College Online, is offering 47.5p a share in cash for Wey.

In response the education company’s share price jumped by 43.1% to 46.5p, an increase of 14p.

Commenting on the Acquisition, Nadim Nsouli, founder, Chairman and CEO of Inspired and director of Bidco, said:

“We are pleased to receive the recommendation from the Board of Directors for the acquisition of Wey Education, a long-term leader in online education with a strong reputation in the UK and international markets,” Nsouli said.

“We believe this represents an exciting development for both Inspired and Wey, which will support the Combined Group’s growth nationally and internationally. Wey, which is providing a British curriculum education through its online live teaching and learning platform, will now be able to benefit from the support of a global schools group with leading educational experts, strong brand recognition, and premium physical facilities across the globe.”

From the perspective of Wey, Barrie Whipp, chairmen of the company said:

“The Board believes that Wey being part of the Inspired Group will be positive for students, staff and teachers that remain with the business. Inspired has made an all-cash offer at a price per share that the Wey Education Board feels it can support and a premium to the current share price that allows shareholders to realise a gain fairly reflecting Wey’s future growth opportunities. Accordingly, the Wey Education Board intends to unanimously recommend the offer by Inspired to Wey’s Shareholders to vote in favour of the Scheme.”

A Q1 review of UK Equity Markets

UK Investor Magazine
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A Q1 review of UK Equity Markets

Alan Green joins the Podcast as we discuss and review UK Equity Markets in the first quarter of 2021.

Despite the FTSE 100 posting gains of around 4% in Q1 2021, London’s leading index has traded largely sideways within a range. However markets have experienced bouts of volatility on concerns over COVID-19 and rising bond yields providing plenty of opportunity for positioning for the rest of the year.

Travel and Leisure shares were, unsurprisingly, among the top risers in the first quarter alongside those industries that fall into the ‘value share’ category such as banks, financials and commodities.

We touch on the UK’s small cap index and explore a number of companies posting strong gains in 2021 before detailed analysis of Echo Energy (LON:ECHO), Cadence Minerals (LON:KDNC) and Trident Royalties (LON:TRR).

Oilex share price soars as company finally reaches Cambay resolution

Liam Roche
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Oilex share price soars as company finally reaches Cambay resolution

Oilex has been looking to purchase 55% of Cambay field since 2016

Oilex (LON:OEX) shares soared on Thursday as the firm made progress towards settling a dispute over an Indian gas project which it has been aiming to secure control of for a number of years.

The AIM-listed company has been looking to purchase 55% of the Cambay field since 2016. However, the company found itself in the midst of a dispute with the state-backed Gujarat State Petroleum Corporation Limited (GSPC) over costs, which even went as far as an Indian courtroom.

The disagreement now appears to be on the road to a resolution. Oilex has now confirmed that GSPC has given the green light for the sale of its stake for $2.2m, as well as the state government of Gujarat, giving Oilex 100% of the field.

The oil company still needs further approval of the Indian government for the sale to go ahead, including the finalisation of a binding sales and purchase agreement, and finalisation of funding arrangements, which the company expects will go ahead in Q2 of 2021. At this point Oilex will be able to resume field work.

Joe Salomon, managing editor of Oilex, expressed relief at the news and provided a roadmap forward.

“We are pleased that Oilex and GSPC have been able to work together to agree this outcome and in doing so a major milestone has been achieved by the Company in the face of many challenges,” Salomon said.

“The long-awaited resolution provides the Company with a pathway to evaluate the significant gas resource potential identified at Cambay. Oilex and GSPC continue to work together to finalise past pending costs related to certain field costs and regulatory spending prior to 2018.”

The news has sent the company’s AIM-listed shares up 142% or 0.4p.

Pound holds steady vs euro as optimism grows over UK economy

Liam Roche
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Pound holds steady vs euro as optimism grows over UK economy

UK Manufacturing PMI rose sharply in March to 58.9

The pound held steady vs the dollar on Thursday, while down slightly against the euro, as traders are optimistic over its outlook.

During Q1 of 2021 the pound enjoyed its strongest performance since 2015, gaining 4.8%.

UK Manufacturing PMI rose sharply in March to 58.9, a ten-year high, according to research by IHS MARKIT / CIPS, as optimism around an economic recovery intensifies.

Just before lunchtime on Thursday, the pound was at $1.37725, while versus the euro, the pound was down by 1% at 85p per euro.

The public mood around the government’s handling of the pandemic and recovery has become an optimistic one.

A survey conducted by the British Chambers of Commerce said over half of companies anticipated higher revenue levels in the coming year.

This is despite the present business environment remaining worse than the levels prior to the pandemic as the UK entered 2021 in a lockdown.

“While the GBP may continue to struggle vs. the USD in the current environment, we expect that it will remain well supported vs. low yielding G10 currencies such as the CHF, JPY and the EUR,” Rabobank senior FX strategist Jane Foley wrote.

Eurozone manufacturing sector surges at record rate in March

Liam Roche
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Eurozone manufacturing sector surges at record rate in March

PMI measure soared to 62.5, up from February’s level of 57.9

Manufacturing in the eurozone performed robustly during March, as operating conditions improved by the highest level in 24 years of records.

The PMI figure, a measure of the prevailing direction of economic trends in manufacturing, soared to 62.5, up from February’s level of 57.9, indicating a substantial improvement in the sector’s performance.

The index has now registered above 50.0, the level which reflects no changes in output, for nine months in a row.

Germany66.6 (flash: 66.6)record high
Netherlands64.7record high
Austria63.439-month high
Italy59.8252-month high
France59.3 (flash: 58.8)246-month high
Ireland57.18-month high
Spain56.9171-month high
Greece51.813-month high
Countries ranked by Manufacturing PMI: March

Growth was broad-based across the region, with Germany and the Netherlands leading the way. Both nations recorded their highest ever PMI levels in March.

Greece, in contrast, recorded only modest growth, despite enjoying its best PMI reading for over a year.

The further strengthening of trade, orders and production placed further strain on already stretched supply chains.

According to the latest data, average lead times for the delivery of inputs lengthened at an unprecedented rate as challenges in sourcing inputs due to product shortages, stronger global demand and ongoing logistical challenges linked to COVID-19 continued in March.

According to the latest data, the rate of increase in buying was the strongest ever recorded by the survey, although with continued delays in delivery, firms sought to utilise their existing stocks wherever possible. Whilst falling at a slightly slower rate, input stocks declined in March for a twenty-sixth successive month.

Commenting on the final Manufacturing PMI data, Chris Williamson, Chief Business Economist at IHS Markit said:

“Eurozone manufacturing is booming, with production and order books growing at rates unprecedented in nearly 24 years of PMI survey history during March,” Williamson said.

“Although centred on Germany, which saw a particularly strong record expansion during the month, the improving trend is broad based across the region as factories benefit from rising domestic demand and resurgent export growth.”

“Driving the upturn has been a marked improvement in business confidence in recent months, with expectations of growth in the year ahead running at record highs in February and March. This has not only boosted spending but has also led to rising investment and restocking, as firms prepare for even stronger demand following the vaccine roll-out.”

FTSE 100 off to positive start ahead off holiday weekend

Liam Roche
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FTSE 100 off to positive start ahead off holiday weekend

Climbing 0.6%, the FTSE 100 found its way back above 6,755 after the bell. The index spent the final week or so of March repeatedly hitting its head on 6,775 before retreating, even with the confidence boost of Monday’s re-opening.

“The biggest contributors to the FTSE 100 in index point terms were miners Glencore and Rio Tinto as plays on stronger commodities demand and positive read-across from US President Joe Biden’s plan to invest heavily in infrastructure,” said Russ Mould, investment director at AJ Bell.

““In backing these companies, investors are effectively looking past any short-term noise and potential setbacks to getting the pandemic under control, and instead looking well into the future and taking the view that earnings will not just start to recover in 2021 but also keep improving thereafter,” Mould added.

Despite the Dow Jones failing to finish March at an all-time high, the European indices had a spring in their step on the first day of April.

“Though the DAX was only slightly ahead of the FTSE with a 0.6% increase, given their relative levels that means something very different for the German index. It is now at a fresh record peak of 15,090 and will be keen to stretch its neck to 15,100 before the day is over,” Campbell added.

FTSE 100 Top Movers

Melrose (4.54%), IAG (3.56%) and Aveva Group (3.32%) were the top risers on the FTSE 100 during the morning session on Thursday.

Phoenix Group Holdings (-2.47%), Smith & Nephew (-0.94%) and AstraZeneca (-0.92%) have not fared so well, seeing the biggest falls so far.

Next

Next navigated the coronavirus pandemic by growing the scope of its online business which accounted for nearly 50% of the company’s revenue.

The fashion retailer confirmed that its online sales have exceed estimates during the first eight weeks of the year, up 60% compared to two years ago. Subsequently the FTSE 100 company is raising its profit guidance by £30m to £700m.

“That its pre-tax profit was still so strong is to be applauded. The high street staple has been able to shield itself from the full impact of lockdown thanks to its online store, with Lord Wolfson also pointing out the fortune of its strongest growth areas being those with a low return rate,” Campbell said.

“Adding an extra layer of shine to the FTSE 100’s open, Next itself rose 2.8% to a 2 and a half month high of £80.86 per share.”

Argo Blockchain appoints Guidehouse as climate strategy advisor

Liam Roche
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0
Argo Blockchain appoints Guidehouse as climate strategy advisor

Guidehouse will provide the crypto miner with a full climate action plan

Argo Blockchain (LON:ARB) confirmed on Thursday that the company has hired Guidehouse, the consultancy firm, to research and advise on its long-term goal of being carbon neutral via science-based solutions.

Guidehouse will provide the crypto miner with a full climate action plan to assists in its target of becoming a net-zero greenhouse gas (GHG) company.

Argo Blockchain is trying to set an example to others in the industry and is actively researching “numerous strategies to be a climate friendly cryptocurrency miner”.

The AIM-listed firm said that Guidehouse is best positioned to provide strategic recommendations to become net-zero based on its depth of expertise as a global sustainability leader and its extensive experience providing advisory services to the technology industry.

Argo said Guidehouse would not inhibit its mining operations and would allow the company to continue to prosper an an ever-changing sector.

Argo chief executive Peter Wall expressed his delight at the new partnership with Guidehouse:

“We are delighted to be working with Guidehouse to assess the options available in order to achieve our goal of becoming net-zero and a climate friendly cryptocurrency miner,” Wall said.

“At Argo, we pride ourselves on being pioneers within this hugely exciting sector, and we aim to become the gold standard for other miners to ensure we are doing everything we can to secure a sustainable future for generations to come”, he added.

Argo Blockchain confirmed earlier this month that it had finalised a fund-raising to allow the company to complete an investment in Pluto Digital Assets.

In addition, Argo intends to pursue strategic opportunities in crypto mining, capital investment, decentralised finance (DeFi) and Web 3.0 initiatives.

Guidehouse is a leading global provider of consulting services to the public and commercial markets with broad capabilities in management, technology, and risk consulting.

Equiniti swings to loss amid ‘challenging macro environment’

Liam Roche
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0
Equiniti swings to loss amid ‘challenging macro environment’

Equiniti makes pre-tax loss of £6.6m

Equiniti (LON:EQN) said 2020 had been a challenging year as the firm announced a fall in revenue, EBITDA and profit.

The payments and technology company saw its turnover fall by 15% in 2020 to £471.8m, while its underlying EBITDA was down 32.6% to £91.7m.

Equiniti announced a pre-tax loss of £6.6m, a swing from a profit of £40m in 2020.

The FTSE All-Share company also confirmed it would not be offering a dividend during 2020, having done the same in 2019.

Cheryl Millington, chief executive of Equiniti, outlined the impact of the pandemic on the business:

“Our financial results for 2020 have been significantly impacted by the challenging macro environment. However, the fundamental strengths of our business model remain and EQ is well positioned for an improvement in market conditions and economic and capital market recovery,” said Millington.

“While uncertainty continues, the outlook for capital market activity in 2021 is encouraging and we have started the year well with a number of important new business wins. Our focus is on driving performance and market share, while reducing the Group’s debt and delivering on our cost initiatives to offset reduced interest income in a low interest rate environment.”

“We look forward to welcoming Paul Lynam as CEO from 1 April. I would also like to thank all of my colleagues for their ongoing commitment in continuing to deliver a seamless service to our clients throughout the COVID-19 crisis.  As CEO I have witnessed the consistency and quality of the service that EQ delivers, which has been so critical in these challenging times. The depth of our client relationships provides me with confidence as we look to the future.”

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