Augean suspend dividend due to net debt situation
Augean plc (LON:AUG) have told shareholders that they will suspend their annual dividend due to its net debt situation.
The Executive Chairman commented: “The Group is currently trading in line with the Board’s expectations for 2020 with a continued focus on business growth in niche segments and cash generation. The Board will not pay a dividend for 2019, maintaining its position of not resuming dividends until the debt, recently drawn down to fund the HMRC payment, is significantly reduced.”
The firm said that it had swung to a net loss despite seeing revenue growth across the annual period.
In their financial year, which ended on December 31 – the waste management firm recorded a pretax loss of £15.3 million which sees a sharp drop from £10.6 million profit booked the year before.
Notably, Augean booked a £26.2 million charge related to the settlement of landfill tax assessments.
HMRC issued Augean South with a final assessment for £16.2 million from the period from February 2015 to May 2018, and in October a £11.4 million bill was issued to Augean North.
Pretax profit rose for the firm, from £11.4 million to £19.2 million – notably this equates to a 68% rise.
Augean recorded that revenues had climbed 34% year-on-year to $107.1 million from £79.7 million, which the firm said was down to good ales at all sales.
The firm praised the performance of the Treatment & Disposal segment and North Sea which saw rises of 24% and 61%.
Augean added that the group’s net debt was £17.8 million, compared to last year where they had cash surplus of £8.2 million.
The firm stated that they will not be paying a dividend until its HRMC payment is reduced.
Commenting on the results, Jim Meredith, Executive Chairman, said:
“2019 was a good year for the Group. I look forward to making further progress in 2020 with growth in the Group’s core niche markets.
The Board recognises that our business success is dependent on the quality, diligence and hard work of all Augean’s employees and I would like to take this opportunity on behalf of the Board to thank everyone who has contributed to the Group’s strong progress during the year.
As in previous years, I am pleased to note the addition of new shareholders to our register during the year and again I am thankful for the continued support from all of our investors.
The Group set ambitious targets for the 2019 year which it comprehensively exceeded. Undoubtedly 2020 is economically uncertain for the UK economy as a whole whilst Brexit plays out but, with limited direct exposure to EU markets, coupled with a strong start to 2020 trading and a robust pipeline of activity, the Board remains confident in the Group’s prospects for the new financial year.
Donald Trump visits India
Donald Trump has been in India over the last few days, with the intention to get a trade deal done with India and also bolster his election campaign hopes.
The US President has said that he has agreed to ‘promptly’ conclude ongoing trade talks with Indian Prime Minister Narendra Modi.
Donald Trump has had a good relationship with India across his tenure in the White House, as him and Modi are similar in political views but different in others.
They both share a similar sentiment of nationalism combined with a strong business ethos, and it is no surprise that the two leaders have gotten along so well.
Trump’s visit to India lasted two days, across February 24-25, and he announced his intentions to sell $3 billion of military equipment to India.
“They agreed to promptly conclude the ongoing negotiations, which they hope can become phase one of a comprehensive bilateral trade agreement that reflects the true ambition and full potential of the bilateral commercial relations”, the White House said.
Despite the seemingly strong relationship with India, Trump has criticized the high tariffs on imports that have been placed.
“If the deal happens with India it will be at the end of this year and if it doesn’t happen then we will do something else,” the President said on Tuesday.
Being the shrewd businessman that Trump is, he has said numerous times that he wants to be treated fairly and given access to the vast Indian market space.
Trump right now is balancing many things, however his election campaign will be at the top of his priority list.
A few days back, I wrote about how Bernie Sanders could potentially challenge Trump in November – and this is still a big challenge for Trump.
However, the relationship he has built with one of the world’s superpowers in India is notable – and the effect that this may have on Indian American voters could help his re-election prospects.
Egdon Resources see interim output increase
Egdon Resources Plc (LON:EDR) have updated the market on Wednesday on their first half operations.
The oil and gas exploration firm said that production in the first half of its financial year had increased compared to the same period one year ago.
Additionally, the current volumes of production has remained constant with guidance.
Across the six month period, which ended on January 31, Egdon said that total production was 32,758 barrels of oil equivalent, giving an average of 178 barrels per day.
This saw a steady increase from the 30,026 barrels per day figure reported a year ago, or the equivalent of 164 barrels per day,
Egdon added that current production is also within its current guidance range of 170 to 180 barrels per day – and notably this is also higher than annual guidance expectations to be between 130 and 140 barrels of oil produced per day.
Mark Abbott, Managing Director of Egdon Resources plc, said:
“2020 has started positively for Egdon, with continued strong production across our portfolio, a positive outcome to the Wressle planning inquiry and the announcement of a farm-in by Shell U.K. Limited into our offshore Resolution and Endeavour projects.
Our current focus is on the Wressle field development, where we are working to discharge the planning conditions ahead of commencing site works. We will provide shareholders with a detailed update on Wressle and the Biscathorpe project following Joint Venture meetings in the coming weeks.”
Egdon’s deal with Shell
In January, Egdon announced that they had partnered with Shell (LON:RDSB) on two UK gas discoveries. Shell will be taking a 70% working interest in the two licenses and will take over operations, whilst Egdon will keep the remaining 30%. Shell will pay for the stake by funding 85% of the costs of buying and processing 3D seismic survey data for the Resolution and Endeavour gas discoveries on the licences. The acquisition price is capped at $5 million, beyond which Shell will pay 70% of costs. Egdon Resources would have impressed with the market and shareholders with the partnership with an oil titan in Shell. The firm will be hoping that this partnership can produce results for both parties. Shares in Egdon Resources Plc trade at 3p (-2.80%). 26/2/20 13:15BST.Resolute Mining complete phase two of share placing plan
Resolute Mining (LON:RSG) have announced that they have completed the second part of their share placing plan.
The gold miner said that they have raised AUD23.3 million through a proposed share purchase plan, following an equity raise in 2019.
The first phase of their share placing plan raised AUD196 million, and the update today will please shareholders that the firm now has the program nearly complete.
Resolute have said that they are planning to place a further set of shares to raise a final AUD25 million, which will complete the placing.
The funds are going to be used to pay off a $130 million bridge facility provided by Taurus Funds Management Pty Ltd – which was used to purchase Toro Gold Ltd.
Managing Director and CEO, Mr John Welborn, thanked the Company’s shareholders for their continued support:
“The positive response to the SPP from shareholders is greatly appreciated. Proceeds from the SPP form an important part of the total equity raising proceeds which are being used to repay debt and strengthen the Company’s balance sheet. Resolute is now well positioned to focus on operational performance and delivery of our strategic objectives.”
Resolute Mining see positive few weeks
Last week, Resolute Mining noted that they had seen higher gold reserves at the end of 2019. The gold miner reported a year-end rise in gold reserves, as the planned sale of its Ravenswood mine goes ahead. Resolute told the market that total ore and mineral reserves climbed 15% year on year, rising from 16.6 million ounces of gold to 19.1 million ounces at the end of 2019. The last few weeks have been positive for Resolute, and the firm should be confident following the reaction from shareholders of the share placing program. These funds will now be used to fill any outstanding bridge facilities, and the sale of the Ravenswood Mine should be progressing. Shares in Resolute Mining trade at 58p (-6.45%). 26/2/20 12:49BST.Revolution Bars produce impressive interim results, driven by strong festive trading
Revolution Bars Group PLC (LON:RBG) have posted a sound set of interim results on Wednesday afternoon.
The bar operator said that its loss had narrowed in the first half of 2020, as growth in stores had risen.
For the half year period ending on December 28, the firm saw total sales rise 3.5% to £81.2 million from £78.5 million a year ago.
Following a strong festive trading performance, Revolution added that like for like sales grew 1.2%.
The firm noted that its pretax loss narrowed from £3.5 million one year ago, to £1.6 million recorded today.
Revolution said to shareholders that they do not intend to pay an interim dividend as they want to focus on investing into revitalizing its brands and reducing debt.
Rob Pitcher, Chief Executive Officer, said:
“We have continued to make significant progress revitalising the Revolution brand and further improving the performance of Revolución de Cuba. Having stabilised the business in FY19, FY20 is about consolidation and the benefits of the many actions that we have taken are beginning to be realised.
H2 FY20 has started encouragingly and should we continue on our current trajectory then the Board is confident the business will be well-positioned to resume site expansion in FY21.”
The Chairman, Keith Edeleman added:
“Consistent with the strategy we announced a year ago to focus both management and capital resources on our existing estate and to reduce bank debt, I am pleased to report that in the 26 week period we refurbished seven bars, like-for-like sales performance has continued to improve, and good progress has been made on debt reduction. Our underlying business is much stronger and we are on track to deliver FY20 results in line with market expectations.”
Revolution see strong festive trading
A few weeks back, the firm saw their shares jump following an impressive festive trading update. The firm reported a seventh successive year of record Christmas sales and this lead to a rise in first half revenue. Additionally, shareholders were further impressed as the firm announced a deal with real estate landlords to surrender its lease on five struggling sites, and have rent reductions at four other units. In the four weeks to December 31, the firm saw a 4% rise in like for like sales, as weekly sales during the period averaged £65,000. In the first half period, ending December 28 revenues grew 3.4% to £81.2 million from £78.5 million on year ago, as like for like sales also rose by 1.2%. Shares in Revolution Bars Group PLC trade at 63p (-6.51%). 26/2/20 12:35BST.McColl’s shares crash 16% as firm swings to annual loss
Shares in McColl’s Retail Group PLC (LON:MCLS) have crashed on Wednesday afternoon as the firm gave shareholders a disappointing update.
The retail firm noted that it had swung to an annual loss, as revenues across stores had declined. Additionally, the firm added that store closures had lead to a suspension in final dividend.
Within their financial year, which ended on November 24 – the firm posted a pretax loss of £8.6 million compared to a pretax profit of £7.9 million one year ago.
McColl’s said that this was largely due to a one-off, non cash goodwill impairment of £98.6 million.
Revenues also declined by 1.8% to £1.22 billion from £1.24 billion, as like for like sales remained flat. On an adjusted basis, pretax profit slumped by 30% to £7.3 million from £10.5 million.
As a result, McColl’s have declared that their total dividend will be 1.3p, down from the 4p figure a year ago.
Jonathan Miller, Chief Executive, said:
“We have stabilised the business and refocused on retail execution in 2019, in line with our key priorities for the year. Against challenging trading conditions we have made good operational progress, whilst reducing debt and making appropriate levels of investment.
Looking ahead to FY20, we are embarking on a strategic change programme, refining our model and better tailoring our offer to the customers and communities we serve, using the learnings to build the foundations for future growth.
The fundamentals of the convenience sector remain strong and, with our improving customer proposition, I am confident in delivering sustainable returns for shareholders over the long term.”
Testing waters for McColl’s
In December, the firm gave shareholders a cautious outlook following a slow period of trading. McColl’s guided for adjusted earnings before interest, taxes, depreciation, and amortisation for the 52 weeks to November 24 of £32 million, “marginally” below expectations. It blamed this on softer second-half conditions due to unseasonable weather and dampened UK consumer confidence. Annual revenue declined 1.9% mainly due to store sales, as like-for-like sales flat after a 1.4% fall in the prior year. “While 2019 has been another challenging year for the business, we have made good progress against our goals of operational stability and good retail execution. We are also pleased to confirm that we have continued to reduce net debt, with further progress anticipated due to our ongoing capital discipline,” said Chief Executive Jonathan Miller. From the previous update, it seems that McColl’s had already prepared shareholders for today’s results. The performance of the firm does allude to a wider issue on the British High Street, which many firms seem to be falling victim to. Shares in McColl’s trade at 37p (-14.07%). 26/2/20 12:21BST.Avast report earnings climb across 2019
Avast PLC (LON:AVST) have seen their earnings climb in 2019, as their annual results met expectations.
The software firm noted that full year performance had remained within expectations, as the firm reported double digit profit growth.
Across 2019, the firm saw its revenues climb 7.8% to $871.1 million from $808.3 million, as adjusted billings also increasing 5.7% to $911 million from $862.1 million.
On a better note, pretax profit surged 18% from $339.3 million to $400.1 million.
Looking at customer numbers, Avast also saw an increase of 3.5% to 12.6 million from 12.2 million. Average revenue per customer also edged 3.6% higher $51.02 from $49.24.
As a result of these strong results, the firm lifted its full year dividend by 8.1% to 14.7 cents per share.
Ondrej Vlcek, Chief Executive of Avast, said:
“I’m pleased to report another year of good performance for Avast in 2019, with results in line with the Board’s expectations. Group Adjusted Revenue was $873.1m, with organic growth of 9.1%1, driven by double-digit growth in our Consumer Direct Desktop business. We also sustained a high level of profitability with Adjusted EBITDA margin2 at 55.3%.
“The core of the Avast business and our fundamental strengths remain unchanged. Our focus on cross-sell and upsell, our localisation strategy, and new product releases continue to drive good growth. There is an exciting pipeline of product launches for the year ahead. We continue to expect healthy growth in 2020 and remain confident in the long-term prospects for the business.
“For the full year 2020 we expect Group mid-single digit organic revenue growth, and a stable EBITDA margin percentage.”
Avast build from strong consecutive performances
In October, the firm posted its third quarter results – which also saw a rise in total sales. The cyber security firm said revenue rose 9% year on year for the quarter ending in September. Revenues were totaled at £170 million. For the nine months, adjusted Ebitda grew 6.6% to £358.5 million. The results achieved were consistent with expectations laid out in its half year results results back in August. The global cyber security firm stated its guidance for adjusted revenue to be at the higher end of single digit growth. Avast have enjoyed strong demand for VPN’s and privacy software amidst the battles of Brexit, and are one firm who do not seem to be phased by Britain’s status within the European Union. The firm also published impressive figures of EBITDA growing by 6% to $385.5 million. Shares in Avast trade at 403p (-2.28%). 26/2/20 12:05BST.Weir Group shares bounce 6% despite swinging to annual loss
Weir Group PLC (LON:WEIR) have seen their shares jump nearly 7% despite the firm giving shareholders mixed annual results.
The engineering firm noted that it had swung to an annual loss, due to an impairment charge it tase over its North American assets.
The CEO commented: “North American oil and gas market conditions deteriorated significantly through the year and we undertook a major cost reduction programme in response. While the long-term prospects for shale remain positive, current market dynamics mean it now has a very different investment case to our premium mining technology positions. We are therefore taking actions so that we can maximise value for shareholders whenever the right opportunity is identified”
On a better note, Weir Group reported that it had seen a rise in orders and revenue, which is a positive for shareholders.
Across 2019, the Glasgow based firm reported a pretax loss of £372 million compared to a profit of £86 million one year ago.
The impairment charge faced totaled £546 million, and was recorded within the Oil and Gas North American cash generating unit.
Weir noted that challenging market conditions, and market uncertainty led to estimates of future cash flows featuring lower revenues and margin assumptions.
Pretax profit also slipped 2% from £310 million to £303 million on an adjusted basis.
Weir saw their revenues increase by 9% to £2.66 billion from £2.45 billion the prior year. On a constant currency basis, revenue rose 8% but slipped 4% on a like for like basis.
The firm also told the market that total orders increased by 8% on a constant currency measure to £2.79 billion.
Weir declared a final dividend of 30.45p, which brings the total payout to 45.95p which sees an increase from 46.20p the year before.
Jon Stanton, Chief Executive Officer said:
“2019 saw a strong performance from our mining businesses with margin expansion in both Minerals and ESCO. Our innovative technologies are helping mining become more sustainable as shown by the record £100m Iron Bridge order for our energy-saving Enduron® HPGR technology. We have a major role to play in enabling net zero in mining underpinned by our commitment to reduce our own environmental footprint including cutting our CO2 emissions by 50% by 2030.
Looking to the year ahead, there is uncertainty over the impact of coronavirus (COVID-19) on the global economy and demand for natural resources. Assuming underlying demand does not change, we expect further good constant currency growth in our mining-focused businesses to be offset by the continued challenges in North American oil and gas markets.”
Shares in Weir Group PLC trade at 1,333p (+6.64%). 26/2/20 11:50BST
UK Government plans to review British Foreign Policy
The UK Government, has pledged to change the nature of British Foreign Policy following a governmental review.
PM Johnson has a lot to balance at the moment, amid battling with Brussels and the European Union, the coronavirus situation only seems to be getting worse and worse.
Since the recent Cabinet Reshuffle, nearly a fortnight ago – the face of the Cabinet and Government has changed.
Rishi Sunak, the new Chancellor has expressed his intentions to reveal the budget on March 11 and has confirmed his plans to produce a budget which is beneficial for the British people.
Today, the UK Government has conducted an in-depth review of British Foreign Policy.
Notably, the Diplomatic Service which handles issues such as crime, technology and use of military supplies will be facing a full review.
British Foreign Policy has been under scrutiny over the last 20-30 years, many saying that the ‘special relationship’ with the United States has often meant that Britain has followed the United States in overseas action.
The cases of intervention in states such as Iraq or Afghanistan spring to mind with this hypothesis – and the UK Government has still not healed from the wounds caused by both these conflicts.
Many political authors argue that even with US and UK intervention in Afghanistan, not much has really changed – posing a question as to whether the UK Government needs to review its approach to Foreign Policy.
The review will also seek “innovative ways” to promote UK interests while committing to spending targets.
Boris Johnson, in his Conservative Manifesto noted that the UK would continue to spend 0.7% of gross national income on international aid. Interestingly, there was also a pledge to exceed the NATO target of 2% of gross domestic product on defense.
The UK Government has expressed its intentions to strengthen ties with China, but there has been speculation over the possibility of this with the involvement of Chinese companies into projects such as HS2.
The review has been set to put the following issues into question:
* define the government’s ambition for the UK’s role in the world
* set out the way in which the UK will be a problem-solving and burden-sharing nation
* determine the capabilities needed for the next decade and beyond to pursue objectives and address threats
* identify the necessary reforms to government systems and structures to achieve these goals
The government says it will “utilise expertise from both inside and outside government for the review, ensuring the UK’s best foreign policy minds are feeding into its conclusions and offering constructive challenge to traditional Whitehall assumptions and thinking”.
The review will conclude later this year, and the results and approach taken by PM Johnson and the UK Government will be certainly interesting to note.
William Hill see revenues slip across 2019, however praise strong US and Online peformance
William Hill plc (LON:WMH) have noted that revenues slipped across 2019, as the firm released their annual results on Wednesday morning.
The bookmaker said that revenues fell, however its loss narrowed sharply following less impairment costs on retail stores.
The firm commented: “We have made good progress on the commitment made in 2018 to develop William Hill into a digitally led, internationally diverse sports betting and gaming business of scale with a strong online position and access to fast-growing markets, particularly the US.”
Across 2019, William Hill noted that net revenue had fallen 2.4$ to £1.58 billion from £1.62 billion a year ago. Their pretax loss also narrowed from £37.6 million from £721.9 million – which will be a pleasing take for shareholders.
William Hill told the market that in 2018, the faced an impairment total charge of £922.1 million within its retail sector, following governmental cuts in the maximum stake in fixed-odds gaming terminals to £2 from £100.
The FTSE 250 listed firm also added that the revenue decline was down to the maximum stake limit being applied, but this was offset by better performance in the US and Online divisions.
William Hill cut their dividend from 12p a year ago to 8p – which puts a slight sour note on the update for shareholders.
Ulrik Bengtsson, Chief Executive Officer, commented:
“2019 was a year of transition during which we executed on our ambition to diversify internationally with the acquisition of Mr Green and the continued strong growth of our US business. The Group delivered a strong operating performance, ahead of our expectations and against a challenging regulatory backdrop.
“We move into 2020 in a stronger position. Almost a quarter of revenue is now generated outside the UK compared to 15% in 2018. We made positive progress with our digital platform, launching our purpose-built platform in the US and product developments in the Online business in 2019. We will invest in our proprietary technology as we continue to improve the competitiveness of our customer offering. We have also made great progress embedding a culture of safer gambling across the Group.
“This is an exciting time to be William Hill’s CEO. Our industry is evolving and this brings great opportunities, underlining the importance of our efforts to reposition the business. We look forward to building on these foundations with a renewed focus on customer, team and execution.”