Seeing Machines profits narrow despite 12% revenue growth

Jamie Gordon
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Seeing Machines profits narrow despite 12% revenue growth
AI powered monitoring systems provider Seeing Machines Limited (LON:SEE) booked deeper losses and narrower profits, despite good progress in its revenues for the half-year ended 31 December 2019. Operational revenues were up 12.8% year-on-year, up from $14.0 million to $15.8 million. This was led by an impressive 67% rise in monitoring service revenue, which grew from $2.4 million to $4.1 million on-year.

Despite this progress, the company’s gross profits narrowed from $8.9 million to $5.7 million, while its net loss marginally widened from $24.7 million to $24.9 million year-on-year.

However, the company boasted a strong cash position, with cash up from $26.9 million to $47.3 million on-year. It is also positive about the prospects of its DMS business, and the implementation of its products on roads and in aviation.

Seeing Machines response

Reacting to the company’s half-year results, CEO Paul McGlone commented,

“We continue to work through significant opportunities across each business unit and leverage the growing momentum for driver monitoring technology in Europe, the US and around the world. Our teams are working with some of the world’s biggest brands in Automotive and Aviation, and these deep relationships will secure our long-term competitive position across each of our transport sectors.”

“Our focus remains on meeting the expectations of our customers and delivering on current programs, while responding to a growing number of opportunities in Automotive, Fleet and Aviation.”

“It is clear that DMS is becoming increasingly more integral to improved safety on roads and there is growing recognition for its ability to improve efficiencies and safety in aviation. As this continues to be embraced globally, Seeing Machines is in an outstanding position as the world-leading provider of this technology.”

Investor notes

Following the update, Seeing Machines shares rallied 3.68% or 0.12p, to 3.24p per share 10/03/20 12:07 GMT. For the half year period, the company paid no dividend.

Octopus Renewables spends £59m of IPO proceeds on Ljungbyholm Wind Farm

Jamie Gordon
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Octopus Renewables spends £59m of IPO proceeds on Ljungbyholm Wind Farm
Octopus Renewables Infrastructure Trust (LON:ORIT) announced on Tuesday that it had acquired the Ljungbyholm Wind Farm from OX2 for a consideration of £59 million, including future construction payments. After the completion of the acquisition, Octopus Renewables will own 100% of the the construction-ready wind farm project. The project is located in Kalmar in Southern Sweden, and construction is expected to be completed by the middle of 2021, with the farm expected to be operational later that year. The company said an affiliate of OX2 will carry out the construction under a fixed-price turnkey contract, and that it would be completed without any debt finance at the project level. The Farm will consist of 12 turbines with an operating life of 30 years and a total capacity of 48 MW. Further to today’s acquisition, the company said it was looking to target investment in construction, construction-ready and operational renewable energy infrastructure assets in the UK, mainland Europe and Australia. Today’s acquisition represents the first in a pipeline of opportunities outlined by Octopus’s investment arm, and amounts to 17% of the funds raised in the company’s IPO in December 2019.

Octopus Renewables reaction

Responding to the company’s news, company Investment Director Chris Gaydon commented, “We are pleased to announce our first acquisition on behalf of Octopus Renewables Infrastructure Trust. Scandinavia is an attractive market due to the possibility of combining high levels of wind resource with the latest wind turbine technology, and we are delighted to have had the opportunity to acquire this asset in southern Sweden. Furthermore, acquisition of the Ljungbyholm Wind Farm may lead to further opportunities for collaboration with OX2, one of Scandinavia’s leading renewable energy developers.” “Since IPO our pipeline has continued to grow and we are actively pursuing a number of opportunities for the Company in our target markets across the UK, wider Europe and Australia. This first investment is in line with the timelines anticipated at IPO and over the coming weeks and months we look forward to updating shareholders on our progress towards deploying the balance of the IPO funds.”

Investor notes

After an excitable start, Octopus Renewables shares are now up 0.96% or 1.00p since the session began on Tuesday, rallying to 105.60p per share 10/03/20 10:53 GMT. The Group has a NAV of 98.00p per share.

Greatland Gold widen loss as exploration costs surge

Ishen Patel
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Greatland Gold widen loss as exploration costs surge
Greatland Gold plc (LON:GGP) shares are in recovery today, as the firm released its’ interim results yesterday. The firm noted that its’ loss had widened across the first half – as exploration and development costs had surged. Greatland Gold said that it had seen a pretax loss of £2.6 million across the six month period which ended on December 31. Notably, this was deeper than the figure one year ago which saw a £1.5 million loss recorded. Exploration expenses formed the main driver of the widened loss – as these costs rose from £937,732 in 2019 to £1.9 million. Greatland Gold added that their cash stood at £4 million, and since then has received another £2 million of net funds from warrant conversions. Gervaise Heddle, Chief Executive Officer, commented: “The first half of the financial year was an exciting period for Greatland, which saw our Havieron project establish itself as a significant gold-copper discovery. During the period, Newcrest completed the first stage of the Farm-in, expanded the camp, accelerated drilling at this highly strategic asset with eight rigs now in operation, and provided plans for a further 20,000-30,000 metres of drilling over the next two quarters to support a potential maiden resource by the end of the calendar year. “Looking ahead, we will continue to focus on moving our portfolio of assets up the value curve, especially in the Paterson, which we regard as the leading frontier in Australia for the discovery of tier-one, gold-copper deposits. Beyond the exciting progress at Havieron, we have identified over a dozen targets in the region, many of which display similar geophysical signatures to Havieron, and drilling of these targets represents a strategic priority for Greatland in 2020. Our team has spent the last few months planning a comprehensive campaign across these targets and we are well capitalised to make further strong progress throughout the year.” Shares in Greatland Gold trade at 4p (+2.41%). 10/3/20 10:45BST.

Global equities lick their wounds after Black Monday

Jamie Gordon
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0
Global equities lick their wounds after Black Monday
Black Monday offered volley upon volley of bad news for investors, with the worst dip in global equities since the financial crash, and the biggest Dow Jones dip in its century-and-a-half-long history. With Brent Crude diving by a third and the Dow shedding 2,000 points after the open, Monday offered little in the way of good news. Several bluechip equities shed 10-20% of their share price value, and the commodity-laden FTSE had a day to forget. As markets opened on Tuesday, there was room for some insipid green across indexes, with opportunists looking to snatch up the bargains offered by Monday’s casualties. The positive start was bolstered by a slight recovery in oil prices, and promises of economic stimulus from Donald Trump, though the longevity of the positive start will likely be dependent on how the Dow chooses to open during the Tuesday session. Speaking on the recovery of equities after Black Monday, Spreadex Financial Analyst Connor Campbell stated,

“There were a couple of things behind Europe’s green start. Firstly, a fall as great as that seen on Monday is always going to attract a few vultures, swooping in to pick at the market’s bloody carcass – remember, the global indices are now heavily discounted from the all-time highs struck just a month ago.”

“Then there was Donald Trump, attempting to gee-up investors by suggesting he was preparing a ‘major’ economic relief package in the US, one that would potentially include a payroll tax cut and provisions to protect hourly workers. This likely gave further justification at those looking to enter the market at a potential bargain price.”

“At the same time Italy is now in complete lockdown, with internal travel restrictions stretching far beyond the initially quarantined northern part of the country. A serious reaction to a serious situation, which is good. But boy will it be costly.”

“Buoyed by a 6.4% jump from Brent Crude, which in turn helped out the battered BP (LON:BP) and Shell (LON:RDSB), the FTSE was Europe’s best performer, adding 100 points to graze 6100. The CAC, meanwhile, rose 1.2% as it tried to reclaim 4800, with the DAX crossing 10800 as it added 1.2%.”

“Crucial to the longevity of [the European equities recovery] will be the US open. Currently the Dow Jones is set to take back around 800 points when things get underway on Wall Street, a rise that would just about push it to 24600. For context, that’s around 1000 points off of Monday’s lows.”

Cairn Energy swing to profit across 2019

Ishen Patel
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0
Cairn Energy swing to profit across 2019
Cairn Energy PLC (LON:CNE) have swung to a profit in their recently ended financial year – which rounds of an excellent year for the firm. The oil exploration firm noted that its’ strong production performance drove the update published today. Cairn said that their pretax profit totaled $119.5 million across 2019 – this sees a massive improvement on the loss of $1.21 billion posted in 2018. Looking at revenue, this also rose from $410.3 million to $533.4 million – which should certainly spark investor confidence. Across 2018 – the FTSE 250 listed firm noted that it expects net production to be between 19,000 and 23,000 barrels of oil per day in 2020. Simon Thomson, Chief Executive Officer, Cairn Energy PLC said: “Cairn’s strong operational performance in 2019 was delivered through production and cash flow generation at the top end of guidance and the Group ended the year with an increased net cash position and undrawn debt facilities. A significant milestone was achieved in Senegal with a Final Investment Decision taken for the Sangomar development. Reserve additions were made in both Senegal and the North Sea and the Company encountered exploration success alongside Eni in Mexico. The sale of Cairn’s Norwegian business, combined with exits from exploration positions in Ireland and Nicaragua, demonstrate continued focus on capital allocation as the company seeks to generate further value for shareholders on a sustainable basis.”

Cairns’ production figures

In January, Cairn Energy told the market that it had reached the upper end of production guidance. The firm said that 2019 production in the Catcher and Kraken fields in the North Sea averaged 23,000 barrels of oil per day, at the upper end of the 21,000 barrel to 23,000 barrel per day guidance. Early in 2019, Cairn had guided for between 19,000 barrels to 22,000 barrels per day – however this was comfortably passed. Production across 2019 rose by 31% on a year on year basis, and notably Cairn hold a 20% interest in the Catch field tied with roughly 30% in Kraken. Oil and gas revenue for the year was $504 million, at an average price of $64.52 a barrel. This revenue figure is 27% higher than in 2018, though the realised price was over 5% less. Looking at capital expenditure for 2019, the firm reported a total figure of $245 million, and speculated $595 million of capex in 2020. Cairn added that they expect to be spending $135 million on exploration and appraisal within the next year.

Senior Board change

In a separate announcement today, Cairn said that Erik B. Daugbjerg would be appointed as an independent non-executive director with effect from 14 May 2020. Cairn noted that Todd Hunt is set to retire as a non-executive director immediately following the Company’s Annual General Meeting. Ian Tyler, Chairman of Cairn, said: “I am delighted to welcome Erik Daugbjerg to the Cairn Board. Erik’s many years of experience in the oil and gas industry, together with a strong background in business development and corporate transactions will be an important asset to the Board. We look forward to working with Erik as the Company continues to deliver on its strategic objectives. On behalf of the Board, I would also like to thank Todd Hunt for his valuable contribution as a non-executive director over a number of years.” Shares in Cairn Energy trade at 86p (+1.58%). 10/3/20 10:29BST.

DFS shares dip as interim results affected by ‘challenging environment’

Ishen Patel
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1
DFS shares dip as interim results affected by ‘challenging environment’
DFS Furniture PLC (LON:DFS) have seen their shares dip following the announcement of their interim results. The homeware provider said that its’ profit within the first half had dropped, however they had seen an ‘encouraging’ start to the second half. Shares in DFS Furniture trade at 202p (-3.11%). 10/3/20 10:07BST. Across the half year period, which ended on December 29 – DFS said that pretax profit totaled £15.9 million. Notably, revenue also dipped 5.7% to £488 million from £517.6 million. DFS were quick to say that challenging market conditions and wider macroeconomic challenges affected results, as consumer confidence was still fragile. ’Trading performance in the first half of our financial year reflected not only the strength of the comparative period but also the challenges of a market environment that saw political uncertainty and low consumer confidence levels feeding through into lower footfall. We mitigated some of the footfall decline by converting a higher percentage of customers, particularly in DFS and Sofology, relative to the prior year and by growing our Group online revenues. However, these trading conditions have ultimately fed through into our results for the first half.’ Online Growth was strong for DFS, as sales rose 4.5% from £112 million to £117 million. On a slightly better note for shareholders, the firm left its interim dividend flat at 3.7p per share. Tim Stacey, Group Chief Executive Officer said: “We continue to make progress on our strategic agenda focused on driving the DFS core business, further developing our Group platforms and setting Sofology up for future growth. Despite the challenging retail environment, and excluding some isolated systems disruption in Sofa Workshop, our performance over the first half has been as expected, given the exceptional prior year comparative driven by latent demand. In particular we have seen a good performance by the DFS brand in driving conversion and margins and continued online sales growth. Trading in the second half for the Group has also started satisfactorily with performance in the DFS brand particularly encouraging, with order intake growth year-on-year and good gross margins”. DFS also added that the firm will not speculate on its’ full year performance due to the recent coronavirus outbreak. The firm noted that their supply chain should remain steady across the rest of the financial year, and recent changes in trading have only been noted recently. “However, given the uncertainty as to how the current COVID-19 situation will develop it is not possible to give guidance with any certainty for the full-year out-turn. At present we believe our supply chain position should normalise before the financial year end, and it is only in very recent days that we have observed any change in consumer footfall to our showrooms. While any disruption to order intake over the key trading periods of Easter and the May Bank Holidays is likely to impact our financial year 2020 results, it is reasonable to believe this may ultimately be transitory in nature; following periods of subdued demand we typically see much of that latent demand returning. Notwithstanding the uncertain short-term outlook, we remain confident in the Group’s financial strength and relative track record of performance in all environments. Furthermore, we believe our leading market position will allow us to drive long term attractive value creation for our shareholders.” – Stacey concluded.

DFS see mixed start to 2020

In January, DFS updated the market by giving shareholders a pre-warning on their interim results. The firm said that interim sales fell, however they reiterated the fact that they expect full year results to be in line with expectations. The company said forecast profit before tax and brand amortisation for the financial year ending June 28 remains in line with market expectations at £51.2 million, up from £50.2 million in financial 2019.

Global equities destroyed by oil price crash and coronavirus fears

UK Investor Magazine
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Global equities destroyed by oil price crash and coronavirus fears
Global equities were obliterated on Monday as oil prices sank and fears of a coronavirus induced recession led to one of the worst days for equities in history. The FTSE 100 opened down over 7% and the selling continued sending London’s leading index to one the worst day since the financial crisis. Front month WTI Oil was down 30% in the Asia session overnight after Russian President Putin took aim at the US shale gas industry and Saudi Arabia. Putin raised fears of an oil price war as he rejected OPEC proposals to cut oil production. While this takes on the Saudis in a scrap for market shares, the US oil industry will likely be the ones that suffer. Many shale gas operations simply cannot produce oil profitably at such low levels. This, however, was not of great concern to Donald Trump who pointed to the lower petrol prices consumers would enjoy. In addition to the fall out of Putin’s moves, the rise of coronavirus increased chances of a coronavirus Despite sharp declines being followed by some interest in buying, some analysts were sceptical of the bounce being sustained.

£250,000 bill for Springett departure from OnTheMarket?

Andrew Hore
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£250,000 bill for Springett departure from OnTheMarket?

Estate agency portal operator OnTheMarket (LON:OTMP) has given its boss the push and it may not be a cheap thing to do.
Chief executive Ian Springett’s time as chief executive has been terminated by the board. At the time of the AIM flotation in February 2018, Springett had a contract that had been agreed with Agents’ Mutual, the forerunner of on the Market, dating from 2013. This said that he required not less than 12 months notice of termination and his annual salary was £170,000.
The 2018-19 accounts show that the annual salary was increased to £250,000 in 2018. That could be the minimum Sp...

Dignity awaits CMA decision

Andrew Hore
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0
Dignity awaits CMA decision

Funeral parlour and crematoria owner Dignity (LON: DTY) has done relatively well this year in share price terms, but that is due to the declines in the past. The share price fell by one-quarter over the past 12 months and it has slumped by three-quarters over three years. The 2019 figures are due to be published on Wednesday and a further drop in profit is expected.
Fewer deaths and price competitions have hit performance. There remains the spectre of the final Competition and Markets Authority (CMA) report and that could make things even tougher.
A 2019 pre-tax profit of around £40m, down fro...

SimplyBiz falls too far

Andrew Hore
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0
SimplyBiz falls too far

SimplyBiz Group (LON: SBIZ) shares have slumped along with most of the rest of the companies on AIM, but on Tuesday the provider of compliance and business services to financial advisers should show that it is making rapid progress.
The 2019 pre-tax profit is expected to increase by 47% to £14.7m on revenues one-quarter ahead at £65m. A full year dividend of 4.2p a share is expected.
These figures include an initial contribution from financial information and technology business Defaqto, which was acquired last March for £74.3m in cash and shares. Organic growth was achieved. Despite the share...

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