Benchmark on target for full year despite H1 loss

Jamie Gordon
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0
Benchmark on target for full year despite H1 loss
Aquaculture technology firm Benchmark Holdings PLC (LON: BMK) have reported a positive outlook for the full year despite a loss in the first half. The Company stated that despite the loss, it posted a 3% increase in revenues – now up to £78.3 million – and found that growth in Genetics, Health and Knowledge Services offset the drop in advanced nutrition, despite what were described as ‘challenging’ conditions in the shrimp market. For the first half, the Company posted an adjusted EBITDA of £7.5 million, up 25% from £6 million for H1 2018. This, the Company said, reflected the effects of cost control and increasing capacity in Norway, as well as the contribution of high value products and an increase in the value of biological assets as a result of growing sales. However, Benchmark then had to report their £9.1 million loss for the first half, which they said was related to higher finance costs and increased depreciation on recent investments. Further, the H1 for the previous year had the added benefit of a £9.2 million tax credit. In response to the latest round of results, the Company said full year guidance and results would remain “broadly in line with expectations”. Elsewhere in the tech-related sector; Remote Monitored Systems PLC (LON: RMS), Tekmar Group Plc (LON: TGP), Redcentric PLC (LON: RDN), Codemasters Group Holdings Limited (LON: CDM) and Amino Technologies Plc (LON: AMO) provided trading updates.

Benchmark comments

The Company’s Chief Executive, Malcolm Pye, said, “We have delivered growth in Adjusted EBITDA and made progress against our strategic priorities despite challenging conditions in the shrimp markets.” “We continue to implement operational and structural efficiency initiatives and we expect the Group to deliver broadly in line with market expectations for the full year.” “We are starting to see benefits from the investments we have made into a number of areas including our new facility in Salten, Norway.” “These investments, combined with the successful completion of our refinancing, leaves us well placed to deliver on our five year strategy to drive future growth and profitability.”

Preceding this round of results

Earlier in June, the Company announced the successful undertaking of a refinancing venture and placement of a new senior bond issue. In its statement, Benchmark said, “the Company has today successfully completed a new senior secured floating rate listed bond issue of NOK 850 million (USD $95m equivalent). The bond which matures in June 2023, has a coupon of three months NIBOR* + 5.25% p.a. with quarterly interest payments. This new bond issue will refinance Benchmark’s existing $90m credit facility. DNB Markets acted as Sole Bookrunner for the bond issue. As envisaged, a $15m RCF has been provided by DNB Bank ASA.”

“The bond issue was significantly oversubscribed and marks the Company’s entry into the Nordic region debt and securities market, which is globally recognised for its investment in aquaculture, providing the Company with access to a sector specialist investor base.”

Further, the Company announced talks to end its joint venture salmon breeding operation with AquaChile. Company Chief Executive Malcolm Pye stated, “We are pleased to have the opportunity to fully own the world class salmon breeding facility currently owned by the JV and to reinvest the funds to move towards full scale production and commercialisation”. “Whilst this marks a change to Benchmark’s approach to the market, it is a positive step towards fulfilling our key objective of accelerating our establishment of a strong local presence in this important market, in line with our strategy.”

Investor notes

The Company’s shares slightly dipped in trading on Tuesday, down 5.72% or 2.35p to 38.66p a share 25/06/19 14:35 GMT. Analysts from Numis reiterated their ‘Buy’ stance on Benchmark stock.

Remote Monitoring Systems shares dip despite losses narrowing

Jamie Gordon
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2
Remote Monitoring Systems shares dip despite losses narrowing
Remote surveying and inspections services company Remote Monitored Systems PLC (LON: RMS) saw their share price dive during trading on Tuesday morning following their latest trading update. The Company booked an increase in revenue, up to £857,970 for the year ended December 31st 2017, from £788,718 on-year. Contingently, earnings were up £800,000. However, this was only enough to narrow their previous rate of loss rather than eradicate their loss altogether. As such, for the year through December, net losses amounted to £1.1 million, narrowing from £1.9 million on-year. Elsewhere in the tech sector; Tekmar Group Plc (LON: TGP), Redcentric PLC (LON: RDN), Codemasters Group Holdings Limited (LON: CDM), Amino Technologies Plc (LON: AMO) and MTI Wireless Edge Limited (LON:MWE) provided trading updates.

Remote Monitored Systems comments

Regarding ‘outlook’, the company stated that, “The Group continues to make progress across all elements of its business.” “Geocurve, having experienced a slower than expected start to 2019, has prioritised profitability over growth. Cost saving measures have been implemented with the intention of becoming self-financing in 2019, albeit with revenues expected to be lower than those in 2018.”

“GyroMetric, which will be conducting trials for two major wind turbine manufacturers in 2H 2019, has recently signed a contract for a technical cooperation with a major UK supplier to the energy and petrochemical industries and as a result of the recent successful recruitment of a Technical Sales Director, a number of promising opportunities in new sectors, where lead times are typically shorter, are already being pursued.”

“The Board is determined to deliver value to shareholders and continues to examine opportunities to grow both organically and through acquisition of complementary businesses and technologies which can enhance growth in shareholder value.”

The Company’s chairman, Nigel Burton, stated, “2018 saw significant change for the Company, with the transition to a largely new Board and closure of the loss making training business all completed in January 2018. The business now comprises Geocurve, a leading provider of survey and inspection services, and the 58% interest in GyroMetric Systems, which provides digital monitoring and safeguarding systems for rotating shafts. During the year Geocurve grew significantly, with revenues up by 34%, whilst two investments were made in GyroMetric Systems. The name of the company was changed to reflect the new focus and direction of the business, with a new website launched in November.”

Stock update

Following the update, Remote Monitoring Systems shares are currently trading 22.14% or 0.15p at 0.54p a share 25/06/19 13:45 GMT.  

AMC Group opens new factory to supply growing demand for healthier food

Dina Caruso
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0
AMC Group opens new factory to supply growing demand for healthier food
AMC Group announced that it has opened a new plant-based and allergen-free production facility, aiming to supply the growing demand for healthier lifestyle choices. In addition to providing over 100 jobs to the local area, the site is totally free from all of the 14 main allergen groups and produces freshly-squeezed juice and plant-based and free-from products, the company said. AMC Group said that the 55,000 sq ft factory is now fully up and running. It provides juice, yoghurt and soup to a range of brands, large and small retailers and food service restaurants. The factory aims to provide the growing consumer demand for healthier food options. Indeed, as more consumers make the switch to plant-based diets for a variety of reasons, plant-based and free-from products are in growing demand. According to AMC Group, the factory can squeeze 960 oranges per minute, delivering 50% of the fruit weight as juice via six juice extractors. The juice facility has the capability to provide the whole of the UK with freshly-squeezed juice. AMC Group has secured Sainsbury’s as its first business, providing it freshly-squeezed juice. Additionally, it has just begun production of a number of premium lemonades for Waitrose’s summer range, Truly Scrumptious. “There’s an exciting future in store for the site. Plant-based products are in huge demand and there is a gap in the market for a dairy-free factory producing fresh, quality products at scale,” Mike Bullock, Fresh Foods Director at AMC Group, commented on the announcement. Several businesses have begun to accommodate the healthier lifestyle choices made by consumers. Greggs (LON:GRG) saw its sales boosted by the launch of its vegan sausage roll, targeting consumers who pursue a plant-based diet. Nestle (SWX:NESN) announced last year that it was set to make additional cuts to sugar, salt and saturated fat quantities in its product in order to draw in more health-conscious consumers. The food industry is not the only sector to begin accommodating the switch, with the UK’s first 100% vegan hotel opening in the Highlands. According to the Guardian, the number of people in the UK eating a completely plant-based diet quadrupled to 600,000 between 2014 to 2018.

Gear4music earnings drop and swings to net loss

Dina Caruso
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0
Gear4music earnings drop and swings to net loss
The largest UK based online retailer of musical instruments and music equipment, Gear4music (LON:G4M), revealed a 34% drop in earnings on Tuesday. Shares in the business were trading almost 8% lower following the announcement. For the 13 months ended 31 March, Gear4music said that its earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 34% to £2.3 million. The company, which said that its active customers were up 53% to 727,000, also posted a net loss of £163,000. Despite swinging to loss, the business said that it has made “swift strategic operational changes” to reduce the risk of this continuing into the year ahead. Revenue increased 48% to £118.2 million, and gross profit grew 32% to £26.9 million. Gear4music, which issued a profit warning in January, said that it remains confident of continued strong growth and delivering profit improvement in the following year. “Alongside delivering strong revenue growth in the period, we have worked hard to implement a number of commercial and operational initiatives to address the previously reported issues,” Andrew Wass, Chief Executive Officer, commented on the results. “Our FY20 H1 focus is on improving gross margins and ensuring a robust operational infrastructure is in place ahead of our peak H2 trading period, and I am pleased to report these actions are already yielding positive results,” the Chief Executive Officer continued. “We are confident that we have the right strategy, customer proposition, financial resources and focus, to overcome the challenges of FY19, and achieve our objectives of maximising customer satisfaction and delivering value to shareholders.” The business said that it has taken decisive action to address the underlying causes of the profitability challenges faced over the previous year. Gear4music operates from a head office in York, selling own-brand musical instruments and music equipment alongside other premium brands. It sells to the UK, Europe and recently the Rest of the World. Shares in Gear4music Holdings plc (LON:G4M) were trading at -7.83% as of 12:14 BST Tuesday.

Redcentric posts loss following dip in sales

Jamie Gordon
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Redcentric posts loss following dip in sales
IT service management company Redcentric PLC (LON: RDN) have announced a consecutive and deeper annual loss on-year. The Company attributed the loss to a decline in sales, the result of which was a 6.7% fall in revenue, to £93.3 million. In turn, pre-tax losses came to £1.4 million for the full-year through March, widening from £0.5 million on-year. This news follows contention surrounding a case of misconduct during an audit of the Company by PricewaterhouseCoopers. In a statement, PwC spokesperson said, “We are sorry that our work fell below the professional standards expected of us. Since the work in question was completed, we have taken numerous steps to strengthen processes. In addition, this month we announced an additional £30m investment annually as part of a new wide-ranging action plan to provide greater focus on the quality and public interest responsibilities of PwC’s statutory audit services.” Elsewhere in the tech sector, Codemasters Group Holdings Limited (LON: CDM), Amino Technologies Plc (LON: AMO) and MTI Wireless Edge Limited (LON:MWE) provided trading updates.

Redcentric comments

“We have made organisational and structural changes to best position the business for the future whilst at the same time progressing through historical issues that the business has faced,” said Chief Executive Peter Brotherton. “The second half of the year has seen success in the public sector with total contracts signed to date of £17m.” “Additionally we have realised annualised cost savings of £5m.” “Our cash performance continues to be excellent and this, combined with our overall confidence in the future of the group, has allowed us to announce an improved dividend policy and seek authority to commence a share buyback programme.”

Investor considerations

Redcentric declared a final dividend of 1.0p per share – meaning a total dividend for the year of 1.4p. The Company’s shares are down 1.31% or 1.05p since markets opened on Tuesday morning, dipping to 79.15p a share 25/06/19 10:08 GMT. Analysts from finnCap have reiterated their ‘Corporate’ stance on Redcentric stock.    

Tekmar rallies on profit and new contract announcements

Jamie Gordon
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Tekmar rallies on profit and new contract announcements
Subsea cable protection firm Tekmar Group Plc (LON: TGP) have announced that they booked a profit for the full year. The latest update revealed that revenue had grown to £28.1 million, up 28% on-year. In turn, pre-tax profit came to £2 million for the year through March, up from a £0.4 million loss on-year. The Company attributed the success to its ability to win new contracts in the offshore wind sector. Elsewhere in the energy sector, there have been updates from; Pressure Technologies (LON: PRES), Petrofac (LON: PFC) and Redt Energy (LON: RED) today, with operations updates from Eco Oil and Gas (LON: EGO) and Mayan Energy (LON: MYN) last week.

Tekmar Group comments

“The market outlook for offshore wind and oil and gas are both strong, with offshore wind CAGR forecasts above 20% between 2018-2028 and demand for products for the oil and gas market at a three-year high,” said Chairman Alasdair MacDonald. “The group remains focused on its strategy as stated at IPO to deliver long-term growth through the expansion of new products, organic growth and by selective and complementary acquisitions.” “On behalf of all the directors, I am pleased to report that the new financial year has started well and, with current order visibility levels, believe that the group is making good progress to deliver results in line with market expectations in the 2020 financial year.”

Share price update

Following the trading update, the Company’s shares rallied 11.54% or 15p during Tuesday morning trading, up to 145p a share 25/06/19 10:56 GMT.

New Look reveals deeper annual loss

Dina Caruso
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1
New Look reveals deeper annual loss
Fashion retailer New Look posted a deeper annual loss on Tuesday in its full year results. Statutory loss before tax amounted to £522.2 million, deeper than the £190.2 million loss made the previous year. New Look said that the deeper loss was primarily driven by a £423.3 million goodwill and brand impairment charge related to its restructuring. The company, owned by Brait, revealed its restructuring plans in January, aiming to cut debt by £1 billion. Revenue amounted to £1,239.0 million, down 3.8%, but remains in line with expectations given the focus on driving more profitable sales and fewer stores. New Look said that it maintained its number two position for overall Womenswear market share in the 18 to 44 age range. It also outperformed the UK market for core women’s clothing in stores. “Whilst New Look enters the new financial year in a fundamentally healthier and stronger position, in many respects today marks the starting line. We have more work to do to enhance trading and deliver further operational improvements as we continue our turnaround plans,” Executive Chairman Alistair McGeorge commented on the results. “We expect the retail environment to remain as challenging as ever in the year ahead, with continued Brexit uncertainty and unseasonable weather impacting current trading,” the Chief Executive continued. Indeed, Brexit is not the only factor to impact the performance of UK retailers, with several noting that the unseasonable weather patterns has impacted the sales of summer lines of clothing. “We will continue to focus on what is in our control by further enhancing profitability through our fantastic product, building brand equity and grasping new market opportunities.” New Look, along with several other UK fashion retailers, has been subject to difficult sector-wide trading conditions. It recently announced the closure of 60 of its UK stores, endangering 1,000 jobs. Almost 2,500 high street shops closed last year, according to PwC research complied by the Local Data Company. Banks and financial services lead the way with 291 net closures, closely followed by fashion retailers with 269 closures.

Redt shares dive on loss announcement

Jamie Gordon
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0
Redt shares dive on loss announcement
Jersey-based energy storage group Redt Energy PLC (LON: RED) announced that losses had widened on-year and as such, the Company booked a deepened annual loss. The losses have been attributed to a swell in expenses, which more than offset its rise in revenue. It described its strategic review process as progressing well since March, with ongoing discussions taking place with a number of potential collaborators.

“redT energy plc (AIM:RED), the energy storage solutions company announces today that it is commencing a Strategic Review to explore the options available to fund the business going forward. The Board has appointed VSA Capital as financial adviser to assist with the Strategic Review.” The Company said in a statement in March 2019.

“In order to fund the business during the Strategic Review the Company has conditionally raised £940,000 (before expenses) by way of a placing by VSA Capital of 47,000,000 new Ordinary Shares at a price of 2 pence per Ordinary Share to existing investors.”

Today’s update revealed that revenue for the full year rose to £4.2 million, up 87% on-year. Despite this, pre-tax losses for the year through December came to £12.4 million, deepening from £7.5 million on-year. Elsewhere in the energy sector, there have been updates from; Pressure Technologies (LON: PRES), Petrofac (LON: PFC), and Eco Oil and Gas (LON: EGO) and Mayan Energy (LON: MYN) providing operations updates.

Redt Chairman Comments Today

At the end of the Company’s release to investors and press today, Redt Executive Chairman Neil O’Brien stated, “I have been impressed by the significant step forward we have made in the design and manufacturing processes of the latest Gen 3 units and remain optimistic about the Company and its people’s ability to succeed in a market that is forecast to drive fundamental, positive change in our energy system in the years to come.”

“Right now, our immediate focus continues to be the satisfactory conclusion of the Strategic Review process, which is essential to provide the funding and support the Company requires in the near-term to succeed in this space. Progress to date with the Strategic Review has been encouraging and we look forward to updating shareholders further as soon as it is practical to do so.”

“Alongside the Strategic Review, which is being led by the Board, the executive team remain focussed on the manufacture, delivery and operation of our existing projects and securing further business from our sales opportunity pipeline. This work will support the widespread roll-out of our 3rd Generation product, which is the foundation for the Company to become cash generative in the future.”

“In closing, I would like to thank our highly dedicated staff who have faced and overcome the significant challenges of the last 12 months, and my Board colleagues for their continuing support and contribution to the ongoing activities of the Strategic Review process. I would like to extend my thanks also to our shareholders for their continuing support in the face of challenging circumstances, and to our customers for trusting in us to deliver high-quality energy storage infrastructure solutions for their projects.”

Share price update

Redt Energy’s share price dipped sharply in early morning trading on Tuesday, and after a slight recovery, they are now down 16.8% or 0.21p on market opening price, at 1.04p per share 25/06/19 11:45 GMT.  

UK rental markets: where is the most affordable place to rent?

Dina Caruso
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1
UK rental markets: where is the most affordable place to rent?
Latest research for the lettings platform Howsy reveals that 34% of income is spent on rent across the UK. The data looks at where in the UK is home to the most affordable rental markets by the amount of income dedicated to rent, with Wales as the most reasonably priced region at just 30% of income. The figures double for London making it the UK’s most unaffordable region, as expected, with 65% of the average salary spent on renting. The data reveals that Hackney is the least tenant friendly with 83% of the average salary in the borough spent on renting. Brent is second at 77%, Newham third at 75%, followed by Southwark at 70%, Haringey at 67%, Barking and Dagenham at 65%, Enfield at 64% and Barnet at 63%. As for the most affordable locations to live in London, Bromley and Bexley are the best options with the average rental cost amounting to 46% of the average salary. These locations are, however, still above the average price across the UK. Average rental costs by country leave England at the top, with 42% of the average salary spent on rent. Scotland comes in second at 39%, Northern Ireland at 35% and Wales at 30%. “We tend to put a lot of focus on the negatives of the UK lettings market but while top-line affordability may be an issue for many, there are plenty of areas where renting isn’t such a financial burden,” Calum Brannan, Founder and CEO of Howsy, commented on the data. “Maximising your disposable income in any part of the UK is the key to living a happy life in the rental sector and it pays to do your research before making a move to ensure you can not only cover the cost of renting, but you aren’t left high and dry once you have,” Calum Brannan continued. At the beginning of June, data by Halifax revealed that UK house prices rose 5.2% during the three months to May 2019.

Pressure Technologies share price falls despite H1 profit

Jamie Gordon
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2
Pressure Technologies share price falls despite H1 profit
Specialist engineering and industrial valve manufacturing company Pressure Technologies (LON: PRES) booked a modest first half profit with improving oil and gas sector conditions helping to drive sales. The company’s revenue jumped 59% to £14.5 million while pre-tax profit for the six months through March came to £0.1 million, up from a £1.5 million loss the year before. This news follows updates from elsewhere in the energy sector, with Petrofac (LON: PFC) providing guidance updates this morning, and Eco Oil and Gas (LON: EGO) and Mayan Energy (LON: MYN) providing operations updates.

Company comments

“I am pleased with the progress we have made over the past six months in what has proved a very busy period, one that signals a return to profitability for the group,” said chief executive Chris Walters. “The sale of our alternative energy division, which completed in June 2019, was a key milestone.” “We now have a clear strategic focus and are making good progress with the management, operational and cultural changes that will help accelerate organic growth and performance improvements in target markets.” “Our results for the first half of the year reflect the delivery of major defence contracts and improving conditions in the oil and gas sector.” “We are pleased with the growth in our order book and the increasing diversity of our customers and products.” “I have confidence in the outlook for the group as we approach the next phase of our strategy.”

Pressure Technologies trading update

The Company did not declare an interim dividend alongside this latest update. Further – following today’s update – the company’s shares have dipped sharply so far during trading on Tuesday morning, down 8.27% or 11p to 122p per share 25/06/19 09:45 GMT.
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