Sosandar appears attractive

Andrew Hore
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Sosandar appears attractive

Online fashion retailer Sosandar (LON:SOS) is a much smaller business than ASOS (LON: ASC) and boohoo.com (LON: BOO) and it has a different niche. However, it is growing rapidly and has raised a further £7m to finance further growth.
History
Sosandar.com was launched in 2016 by former fashion journalists who had passed the age when they were interested in fast fashion brands and had significant income to spend on fashion. They knew there were plenty of other women like them who could not find the style and quality of clothes they wanted.
The company reversed into AIM cash shell Orogen in Nov...

Euromoney LME boost

Andrew Hore
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Euromoney LME boost

Financial information publisher and events organiser Euromoney Institutional Investor (LON: ERM) is releasing its third quarter trading statement on Wednesday. This should provide information on the progress of the performance improvement strategy.
The announcement will be combined with a capital markets day for investors.
Growth
Interim revenues decline due to disposals, but organic growth was 1%. This rate of growth should accelerate, and the latest quarter will provide some indications about whether or not that is happening yet.
Price reporting and analytics business Fastmarkets is likely t...

Hotel Chocolat pre-close update

Andrew Hore
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Hotel Chocolat pre-close update

Chocolate products retailer Hotel Chocolat (LON: HOTC) has been a big success on AIM. The share price has risen from 148p to 353.5p since the flotation in May 2016. On Wednesday management will be publishing a pre-close trading statement.
In reality, there should be no significant surprises because the first half is the most important, because it includes Christmas. Hotel Chocolat remains a strong brand.
Expectations
Interim revenues were 13% ahead at £80.7m and full year revenues are expected to improve from £116.3m to around £130m.
The profit is made in the first half so the reported ful...

Miton Group sees AUM rise in first half

Jamie Gordon
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Miton Group sees AUM rise in first half
AIM listed fund management Company Miton Group PLC (LON: MGR) saw its Assets Under Management rise in the first half, and today it published its H1 results for investors and press. For the half year ending 30 June 2019, the Company announced its AUM had risen 8% since 31 Decemebr 2018, up from £4.376 billion to £4.724 billion. Further, Miton average AUM had jumped 11.5% on a year-on-year basis, up from £4.126 billion for H1 2018 to £4.601 billion for H1 2019. The Company also noted that cash balances had increased for the first half on-year, with £21 million as of 30 June 2018, to £23 million at 30 June 2019. There was also a turnaround in cash flows, with H1 2018 demonstrating £616 million in inflows, while H1 2019 illustrated outflows of £82 million.

Miton Group Comments

Chief Executive of the Company, David Barron, had the following notes to add to the results,

“The Group has seen its AuM increase by £348 million in the Period to close at over £4.7 billion. In common with much of the industry, we experienced outflows from our UK equity funds reflecting both the wider concerns about the UK market and the divergence in returns from different parts of the market, post the 2016 Brexit vote. Our funds are actively managed and at times their performance will differ from peers and the wider market.

By offering a wider range of strategies the Group continues to diversify the business and its revenue streams. At the Period end, for the first time, the Group had four investment teams each managing AuM in excess of £600 million. These and our other strategies have further scope for growth having established critical mass and strong performance track records.”

Investor notes

Following the release of today’s results, the Company’s shares dipped 2.34% or 1.1p to 46p a share 12/07/19 13:58 GMT. Liberum Capital analysts reiterated their ‘Buy’ rating on Miton stock, while Peel Hunt reiterated their ‘Add’ stock. Elsewhere in wealth management, there have been updates from; Walker Crips Group plc (LON: WCW), Liontrust Asset Management PLC (LON: LIO), Mattioli Woods (LON:MTW), Intermediate Capital Group plc (LON:ICP) and Babcock International Group PLC (LON:BAB).

Aquila European Renewables acquires stake in Norwegian wind power

Jamie Gordon
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5
Aquila European Renewables acquires stake in Norwegian wind power
Renewable energy investment firm Aquila European Renewables Income Fund (LON: AERI) announced today that it had made its third acquisition since its successful IPO on the London Stock Exchange in May 2019. The Company acquired 25.9% of the share capital in one of Norway’s largest wind farms, Midfjellet Vindkraft AS. The farm was built in three phases; phase one and two comprise 44 N100 and N90 wind turbines that have been operational since 2013 (2.5 megawatts each), both are from Nordex. The third phase comprised 11 Nordex N117 3.6 MW turbines (totalling 40 MW), and commenced operation in August 2018.

Aquila European Renewables comments

Company Chairman Ian Nolan, said,

“The Board is very pleased with the continued capital deployment towards a diversified portfolio of renewable energy assets. Investments in projects backed by PPAs is a key element of the Company`s investment strategy and value proposition. The acquisition is expected to make a strong contribution towards AERIF´s dividend objective.”

“Commenting on today’s announcement, Christine Brockwell, Senior Investment Manager at Aquila Capital, the investment adviser: “With the investment in Midtfjellet, the Company is diversified across three continental European countries, Portugal, Denmark and Norway, with a good blend of revenues from feed-in tariffs and power purchase agreements. In aggregate c. 40% of the proceeds raised from the IPO are invested and we are looking forward to advising the Company on further investments in the near future.”

The Company’s statement then continued with additional information, “A comprehensive hedging strategy for the proceeds from the sale of electricity and green electricity certificates (“Elcerts”) as well as guarantees of origin (“GoOs”) was recently implemented by Aquila Capital. The power purchase agreement (“PPA”) covers 70% of the expected P-50 production for the next ten years. The investment was part of the enhanced pipeline, as disclosed in the prospectus dated 10 May 2019 and the consideration amounts to c. 13.3% of the proceeds raised.”

Investor notes

The Aquila European Renewables shares rallied modestly by 0.73% or 0.0075p to 1.04p a share 12/07/19 12:42 GMT. Elsewhere in the renewable energy sector, there have been recent updates from; PowerHouse Energy Group (LON: PHE), SIMEC Atlantis Energy (LON: SAE), The Renewables Infrastructure Group Ltd (LON: TRIG), Tekmar Group Plc (LON: TGP) and Remote Monitored Systems PLC (LON: RMS).

John Menzies board reshuffle following profit warning

Jamie Gordon
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John Menzies board reshuffle following profit warning
Aviation services Company John Menzies plc (LON: MNZS) announced a series of board changes following its profit warning last week. The Company announced that its presiding Chairman of the Board, Dr Dermot F Smurfit, will vacate his position on the Company’s board and be succeeded by Philipp Joening, who is the current non-Executive Director. Further, the Company said that the new Deputy Chairman will be David Garman, who currently holds the office of Senior Independent Director.

Menzies Board comments

The John Menzies Board commented on the update, with Dr Smurfit beginning,

“I have greatly enjoyed my time with Menzies during which we have delivered on a number of key corporate and financial objectives. I wish the Group and its 36,000 employees the very best for the future as it embarks on the next stage of its journey. I believe that this now requires an industry specialist to bring Menzies to a new level of excellence. I wish my successor, Philipp Joeinig every success in that mission.”

David Garman, followed,

“On behalf of the Board, we would like to recognise and record our sincere appreciation to Dr Smurfit for his significant contribution to our business. He has been an effective and excellent Chairman and we wish him well with his future endeavours.”

Incoming chairman, Philipp Joeinig, added,

“I am very honoured to have been appointed to succeed Dr Smurfit as Chairman of John Menzies plc. I believe the Group has a very exciting future and I look forward to working with the Board and the management team as we look to progressively grow the business and deliver returns to our shareholders.”

The Company’s details then enclosed the following,

“Dr Smurfit joined the Board in July 2016 and oversaw the $202m transformational acquisition of ASIG Ltd, successfully sectioned the defined benefit pension scheme and, most recently, completed the sale of Menzies Distribution, exiting the Group from the print media logistics sector.”

“Following the Distribution sale, the Group’s transformation is now complete and Menzies is a pure play Aviation Services business that is very well placed to prosper in the fast-moving aviation sector.”

Investor notes

Following the update, the Company’s shares 0.82% or 3.5p to 423.5p a share 12/07/19 12:54 GMT. Shore Capital, Berenberg and Peel Hunt all reiterated their respective ‘Buy’ stances on John Menzies stock. Elsewhere in aviation, there have been updates from; Wizz Air (LON: WIZZ), Thomas Cook (LON:TCG) and Ryanair Holdings Plc (LON:RYA).

Nu-Oil and Gas shares dip on $1.1m Statement of Claim by PVF

Jamie Gordon
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Nu-Oil and Gas shares dip on $1.1m Statement of Claim by PVF
Oil and gas production company Nu-Oil and Gas PLC (LON: NUOG) has seen its share price dip following a statement of claim filed against its subsidiary Enegi Oil Inc, in regard to the Production Lease 2002-01A and interactions with its partner Company at the asset, PVF Energy Services Inc. After signing a Production Sharing Agreement on the 30 January 2017, Enegi and PVF attempted to decide an appropriate course of action to progress the asset, following ‘issues arising during the work programme carried out by PVF’.

According to the Company, it received notice on the 10 July 2019 that PVF had submitted a Statement of Claim to the Supreme Court of Newfoundland and Labrador General Division on 26 June 2019. This was despite the Company having – as it described – made efforts to try to find a resolution within the bounds of the PSA. The sum claimed by PVF totalled C$1,122,325.73.

Nu-Oil and Gas statement

The Company’s statement continued,

“The PSA clearly states that PVF will carry out the work programme ‘at its sole cost, risk and perils’ and that costs properly incurred in carrying out the programme are reimbursable out of production from a well and not by Enegi. The Directors therefore believe that there is no merit in the Claim.”

“Further, the PSA provides for a clear process for the resolution of any dispute or claim arising out of the agreement. PVF has not followed the prescribed process. The Company has taken initial legal advice and is considering its options, one of which is, on this basis, to challenge the jurisdiction of the Court in this matter.”

“The Company does not believe that defending the Claim, against its subsidiary, will have any significant impact on its future activities.”

Executive Chairman of Nu-Oil, Graham Scotton, added the following comments,

“The Company has been attempting to work with PVF in good faith to find an appropriate way forward for Garden Hill, despite the operational issues encountered, and we are surprised and disappointed that PVF has chosen to take this action, in contravention to the terms for dispute resolution and cost recovery in the agreement signed by the parties.”

“The Company is obliged to notify the market of this situation irrespective of our opinion on the basis for the Claim. The situation will take time to resolve, however I do not expect it to affect our ongoing efforts to secure new assets or have any impact on the Company’s funding requirements. I look forward to being able to reappraise the options for Garden Hill, as part of Nu-Oil’s planned portfolio, once this dispute is resolved.”

Investor notes

Following the update, Nu-Oil and Gas shares have made a slight recovery but still sit 10% or 0.023p down on market opening price, at 0.21p a share 12/07/19 12:05 GMT. Elsewhere in the oil and gas sector, there have been updates from; PetroTal Corp (CVE: TAL), Hurricane Energy plc(LON: HUR), TLOU Energy Ltd (ASX: TOU), Eland Oil and Gas PLC(LON: ELA), IGas Energy PLC (LON: IGAS), Anglo African Oil and Gas (LON: AAOG), Nostra Terra Oil and Gas plc (LON: NTOG) and Prospex Oil and Gas Plc (LON: PXOG).

Pan African Resources reports rise in gold mining and processing volumes

Jamie Gordon
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6
Pan African Resources reports rise in gold mining and processing volumes
Gold ore mining and processing company Pan African resources (LON: PAF) posted increases to its mining and processing in its update for the year ended June 30 2019. The Company told investors in today’s update that gold production from its continuing mining operations spiked 54.1% to 172,442oz and said production from its continued and discontinued operations was up by 7.5%. Its largest operation, Baberton Mines, saw production rise 9.6% to 99,636oz of gold, while Evander mines’ volumes grew from 21,250oz to 26,878oz year on year. Its Elikhulu tailings retreatment plant operation produced 46,201oz of gold, which exclude pre-production gold volumes of 736oz. Pan African Resources added that the plant processed 10.85 million tonnes from the period between September 2018 and June 2019.

Pan African Resources comments

Pan African CEO Cobus Loots added the following insights, “Pan African has emerged at year-end as a safe, low-cost and long-life gold producer, following the successful execution of our strategy. We exceeded the full year production guidance of 170,000 ounces, resulting in the Group’s gold production increasing by 7.5% to 172,442oz – or 54.1% on continuing operations relative to the corresponding reporting period.” “This has been delivered through the cessation of the high cost underground mining at Evander Mines, the successful commissioning of the Elikhulu tailings retreatment plant, and Barberton Mines achieving a significant increase in production. Critically, Barberton Mines achieved a historical milestone of 2 million fatality free shifts during June 2019 and we commend the team for this safety achievement.” “We continue to assess the optionality of our portfolio and are looking to build upon this year’s momentum to drive further growth. Evander’s 8 Shaft Pillar mining is expected to contribute an additional 20,000oz to 30,000oz per annum for the next three years. The Group is currently reviewing the merits of expediting the Egoli project and is assessing funding options. Progress is also being made with the underground mining project feasibility study at Royal Sheba and we look forward to communicating the results to shareholders in the near future.” “We are also very mindful of the positive socio-economic impact that the mining industry has on communities and are proud of the way we manage our stakeholder relations. That said, we continue to experience certain challenges amongst specific stakeholder groups, which have impacted Barberton Mines, and are working in conjunction with law enforcement and other stakeholders to remedy the situation.” “As previously announced, the 2020 financial year production guidance will be approximately 185,000oz, representing an important increase in our year-on-year gold production profile.”

Investor notes

The Company’s shares have rallied 5.71% or 0.6p so far in Friday morning trading, up to 11.1 p per share 12/07/19 11:46 GMT. Peel Hunt analysts reiterate their ‘Buy’ stance on Pan African Resources stock. Elsewhere in the mining and minerals sector, recent updates have come from; Keras Resources PLC (LON: KRS), Jubilee Metals Group PLC (LON: JLP), Ariana Resources plc (LON: AUU), Caledonia Mining Corporation Plc (TSE: CAL), Regency Mines Plc (LON: RGM), Acacia Mining PLC (LON: ACA), Arc Minerals Ltd (LON: ARCM) and Thor Mining PLC (LON: THR).

Sophos rallies on improved revenues and profitability in Q2

Jamie Gordon
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3
Sophos rallies on improved revenues and profitability in Q2
Provider of next-generation cloud-enabled enduser and network cybersecurity solutions, Sophos Group plc (LON: SOPH) saw its share price rally in Friday morning trading, following a quarterly performance update which saw consistent financial improvement. Sophos Group said subscription revenue was up 10% on a constant currency basis while ‘MSP’ and ‘ARR’ were up 78% on a constant currency basis, to $31.8 million. This pushed overall revenues up 3% despite an 11% reduction in hardware revenue. Enduser billings were also up 17% on constant currency, Network billings grew 1%, Sophos Central billings grew 49% to $64.3 million and the Company’s ‘next gen’ business grew 43% to $100.2 million on a constant currency basis. Overall, billings grew 5% to $183.1 million. Adjusted operating profit was up 10% year in year and Cash Ebidta rose 31%, though reported operating profit was said to be down to ‘breakeven’ due to a one-off restructuring charge.

Sophos Comments

Company Chief Executive Officer, Kris Hagerman, commented on the update,

“This has been an encouraging start to the year which underpins our confidence in our prospects for the full year. The demand environment continues to be strong, and as we noted at the full-year, we believe we have a highly effective and differentiated next-generation security product portfolio that positions Sophos very well. Along with encouraging overall company growth, we saw significant continued growth in our next-generation products, including Sophos Central, Intercept X endpoint, XG Firewall, and our MSP business. Consequently, we believe we are well positioned for continued future growth.”

The Company spoke on the impact of IFRS 16 leasing,

“The results for Q1 FY19 reflect the adoption of IFRS 16 “Leasing”. The impact is consistent with the expected impact disclosed in the Annual Report and Accounts for the year-ended 31 March 2019; though the Directors will continue to monitor industry practice and experience of implementation through the coming months and update their assessment of the impact on the Group if required.”

Investor notes

The Company’s shares have rallied 4.19% or 17.3p to 430p per share 12/07/19 11:26 GMT. Liberum Capital and Deutsche Bank retain their ‘Hold’ stances on Sophos Group stock, while JP Morgan Cazenove upgraded its stance from ‘Neutral’ to ‘Overweight’. Elsewhere in the tech sector; MiriAd Advertising plc (LON: MIRI), Zoo Digital Group plc (LON: ZOO), Vela Technologies Plc (LON: VELA), Remote Monitored Systems PLC (LON: RMS), Tekmar Group Plc (LON: TGP), Redcentric PLC (LON: RDN) and Codemasters Group Holdings Limited (LON: CDM) provided trading updates.  

Medicinal cannabis company Freyherr to list on NEX

Dina Caruso
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0
Medicinal cannabis company Freyherr to list on NEX
Medicinal cannabis company Freyherr revealed plans on Friday to list on the NEX exchange in London, as regulation in Europe begins to relax. The first day of trading is expected to be just a few weeks away on 30 July, Freyherr said in a company statement. Freyherr International Group plc is the UK parent company of a business engaged in the production of medicinal cannabis, cannabis cultivation and the production of cannabis dosing and dispensing packaging. Operations are centred in Slovenia and the business mainly operates within the EU. The laws concerning the use of medicinal cannabis are beginning to relax, and it is now legal for medical purposes in 22 countries within Europe. Additionally, six EU member states are expected to be announcing legislation later on this year, the latest being France. By 2028, the European cannabis market could be worth up to €123 billion, according to the market intelligence firm Prohibition Partners. The benefits of medicinal cannabis have become more widely accepted as the list of conditions that it can be used to treat continues to grow. Medicinal cannabis may help conditions such as epilepsy, glaucoma, Alzheimer’s, Crohn’s disease, Parkinson’s disease and chronic pain, in addition to assisting cancer patients having chemotherapy. Freyherr emphasised that for international cannabis companies, Europe is one of the most difficult markets to enter as a result of its strict regulatory framework, complex licensing and trading requirements and cultural and societal nuances concerning the consumption of the drug. Elsewhere in the cannabis industry, Sativa Group plc recently opened its first store of a planned national chain of CBD wellness retail stores. The first of these opened in Bath at the beginning of the month and provides a range of over 50 CBD products, offering consumers the opportunity to try CBD infused coffee and tea.
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