AIM movers: Potential Costa Rica project for ATOME and Vast Resources capital reorganisation

Andrew Hore
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AIM movers: Potential Costa Rica project for ATOME and Vast Resources capital reorganisation

ATOME (LON: ATOM) has announced a collaboration agreement with the state-owned power company in Cost Rica to assess the feasibility of a green fertiliser project in the country. Costa Rica imports all its fertiliser requirements. The project will be a similar size to the 145MW project in Paraguay. A final investment decision has yet to be secured on that project, but it should happen in the next few months.

Transport analytics provider Cordel (LON: CRDL) has started Data-as-a-Service monitoring for Network Rail (High Speed), which maintains the infrastructure for High Speed One. This is the line between St Pancras International and the Channel Tunnel. On-train equipment has been installed data is being processed using AI.

Ayala Deutsch has been appointed a finance director of Ethernity Networks (LON: ENET).  

Bradda Head Lithium (LON: BHL) has published results of the gravity survey at its Basin clay project in Arizona. There is a significant gravity low over the Basin North area. The clay beds are thicker than previously reported. Delivery of a resource of more than 2.5mt unlocks a $3m payment from royalty company LRC and that should be possible with limited drilling. A drilling campaign is planned for the very near future.

Security and surveillance systems developer Petards (LON: PEG) has secured a contract extension with a key customer and this is worth £300,000 over 12 months. The contract covers the company’s real time failure and incident management system for rail infrastructure.

FALLERS

Vast Resources (LON: VAST) is asking shareholders for approval to issue additional shares and for a capital reorganisation that will consolidate 54 shares into nine new shares. The consolidated share price will then be well above the 0.1p par value. The company is trying to reassure creditors that it can raise cash to pay them.

Co-founders Cathal Friel and Brendan Buckley and related interests are selling 14 million shares in infectious disease testing services provider hVIVO (LON: HVO) at 28p each. This is one-quarter of their shareholdings. There is an accelerated bookbuild.

Pan African Resources (LON: PAF) produced 98,458 ounces of gold in the six months to December 2023. All-in sustaining costs were slightly lower at $1,287/ounce, but the full year figure is likely to be higher. Interim pre-tax profit increased 47% to $42.4m. Net debt rose from $53.7m to $64.3m. The Mogale tailings retreatment project should be up and running by the end of 2024 with annual production of 50,000 ounces at a lower cost than current projects.

Valentina Slater, sales director of Anexo (LON: ANX) subsidiary Direct Accident Management, has sold 703,030 shares in the legal services and credit hire company at an average price of 65.7p/share. She still owns 2.82%.

RheEnergise: turning hills into batteries

UK Investor Magazine
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RheEnergise: turning hills into batteries

We are bringing innovation to pumped energy storage with our High-Density Hydro® solution, a -long duration energy storage technology that is low-cost, fast to build and globally scalable.

This century, we are witnessing the increasingly rapid transition from fossil-fuels to low carbon generation due to the critical tipping point we regularly face when dealing with climate change.  Whilst this brings unapparelled opportunities, the race to deliver Net-Zero targets by 2030 is on. Power generation, that is now increasingly serving mobility, heat and industry, is becoming dominated by intermittent wind and solar power. This intermittency means that energy grids around the world require medium-long duration energy storage solutions to provide power grids with flexibility, reliability and stability. Our High-Density Hydro is a solution, that when deployed at scale, will support grid decarbonisation and the transition to Net Zero.

Drawing on the experience of hydropower systems that have been in use for a century or more, our engineers and scientists have devised HD Hydro to be low-cost, energy efficient, fast-to-build and environmentally benign.   Rather than using water, we use a fluid that is 2½ times denser than water, and which can provide 2½ times the power when compared to a conventional low-density hydro-power system.  It means that our system can be deployed beneath the surface of hills rather than mountains – so, turning small hills, found nearly everywhere, into batteries, and so opening up massive opportunities for its commercial deployment.  HD Hydro is proven to outperform and outlast other similar types of energy storage solutions.

We are a young and ambitious company. The market pull for energy storage technologies is exceptionally strong as governments increasingly recognise the urgency to decarbonise over the next 30 years. We are assessing storage sites in the UK and Ireland, Spain and Chile for our first commercial-scale projects, with the USA, Canada and Australia firmly in our sights over the next 1-2 years.  Our first phase of growth has benefited from significant support from the UK Government, with grants and contracts totalling over £1m in 2023 to add to the >£8.25m awarded in 2022 plus we have received incredible backing from private investors. We are now seeking new investors to take RheEnergise to the next level and realise the market opportunities that exist today and in the future.

Parallels between investment history of the wind industry and the investment opportunities in energy storage can be made. Vestas, the world’s largest manufacturer of wind turbines, made their first sale in 1979, by 2000 revenues were €858m and by 2021 revenues were €15,587m. Their growth is not expected to slow.  We can expect that a handful of companies will dominate the short duration energy storage market, a further handful will dominate the inter-seasonal storage market, and lastly there will be a number of companies that dominate the medium duration energy storage space, such as RheEnergise.

BloombergNEF predict the global energy storage market to be worth US$620B by 2040, whilst Wood Mackenzie forecasts that 1TWh of medium-long duration energy storage will be needed by 2030.

As the world moves to a greater reliance on wind and solar power, help us to revolutionise energy storage. If you would like to know more about work and our investment opportunity, please register via this link or contact us via www.rheenergise.com

Visit Crowdcube for more information

Investment risk warning: Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 mins to learn more.

FTSE 100 slips as housebuilders drag

UK Investor Magazine
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FTSE 100 slips as housebuilders drag

The performance of the FTSE 100 matched the weather in London on Tuesday: rather dull and soggy.

A ‘wait-and-see’ mentality was evident in stocks on Tuesday with a raft of economic data due to be released on the horizon, which has the potential to move the dial in terms of sentiment.

“Markets remained in a holding pattern, awaiting the next wave of inflation, manufacturing and GDP data to see if it is possible to second guess when central banks might press the magic ‘cut’ button on interest rates,” says Russ Mould, investment director at AJ Bell,” said Russ Mould, investment director at AJ Bell.

“The Nasdaq tried and failed to hit a new record high last night on Wall Street, even though it is only a whisker away. The FTSE 100 was stuck in the mud as a rebound in AstraZeneca following yesterday’s broker downgrade-induced sell-off was offset by weakness in the technology and industrial sectors.

“Stronger than expected labour data from the UK didn’t help matters as it effectively gives the Bank of England another reason to keep rates steady and not rush to cut them. That’s more of a negative to domestic stocks rather than the large chunk of FTSE members which do business overseas.”

There was also weakness in the UK’s housebuilders after the Conservative government’s latest attempt at revitalising UK property came down like a tonne of bricks on investors.

Persimmon, Taylor Wimpey and Barratt Developments were all down in the region of 4% at the time of writing after reports the UK government were to make brownfield planning applications easier.

While the proposals would help create new homes, there will be scepticism that this is an attempt to win votes rather than a formula to fix the UK’s housing problems.

There were very few gainers on Tuesday, with GSK providing some support, rising 1.6%.

Coca-Cola rises after announcing upbeat Q4 results

UK Investor Magazine
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Coca-Cola rises after announcing upbeat Q4 results

Coca-Cola produced revenue and operating profit growth in Q4, befitting the group’s dominance in the soft drinks market.

The company said revenue grew 12% to $10.8bn in the fourth quarter as operating profit jumped 10%. For a company the size of Coca-Cola to report such strong numbers is a material achievement, solidifying its attraction as a ‘dividend king’.

Investors have become accustomed to reliable shareholder returns from Coca-Cola and today’s numbers reinforce the group’s ability to bolster investor income over time.

 Coca-Cola shares were 1.4% higher in the US premarket.

“Coca-Cola’s fourth-quarter results showcased why it’s still the top dog in the soft drink industry. With 61 years of annual dividend increases, investors would be forgiven for thinking this is a boring mature company,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.

“But double-digit revenue and profit growth suggest otherwise and highlight the fact that this dividend king isn’t resting on its laurels. The revenue uplift came from a healthy mix of both price and volume, at a time when many of its peers are seeing volumes flatten or even decline. The real secret formula to Coca-Cola’s success doesn’t lie in a vault.

“Instead, it lies in successfully aligning its interests with those of its bottling partners. The group does this by having a roughly 20-25% stake in its most important bottlers, with a significant portion of the remaining shares typically owned by a single family. This ownership structure helps to align focus on long-term growth, with skin-in-the-game family owners naturally being more patient than your typical public investors.”

MicroSalt shares double since IPO

UK Investor Magazine
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MicroSalt shares double since IPO

After an additional 27% gain on Tuesday, MicroSalt shares have now more than doubled since listing in London less than two weeks ago.

MicroSalt was the first company to list on London’s AIM in 2024 and has started life as a listed company with a bang.

Shares were changing hands at 87p at the time of writing after trading as high as 92p earlier in the session. MicroSalt’s admission price was 43p.

The company has developed low-sodium salt technology that reduces sodium in the salt by as much as 50%. 

The World Health Organisation estimates 1.8 million people die each year from cardiovascular diseases as a result of consuming too much sodium.

The company has kicked off its fight against sodium consumption with a string of commercial deals and and partnerships with major food company. MicroSalt has already won commercial orders from one of the world’s largest snack food manufacturers.

The company sees a big opportunity in the B2B market and plans to work with potential partners to reformulate their ingredients using MicroSalt’s technology. 

“Most of that salt in people’s diets comes from prepared foods that they’ve purchased, not from salts that they add at home when they’re cooking, or from salts that they add at the table. There is a real business to business opportunity to provide an ingredient that enables food manufacturers to reduce salt levels,” said Judith Batchelar OBE, Non-Executive Chair of MicroSalt.

“MicroSalt does work, and it does work universally in different products. The UK government sets salt targets by each individual food category. There are 84 different categories of food, all of which have their own salt target. You will find MicroSalt works in most of those product categories and in different applications.

MicroSalt is a Tekcapital portfolio company who retain a 77.2% stake in MicroSalt.

Retail offer by JPMorgan Global Growth & Income

Andrew Hore
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Retail offer by JPMorgan Global Growth & Income

Investment trust JPMorgan Growth & Income (LON: JGGI) has launched a WRAP retail offer alongside a placing that could raise up to £40m.

The investment strategy is capital growth via investment in a portfolio of companies on world stockmarkets. There is no sector specialisation. There has been strong demand for the shares and a wealth manager has indicated interest in acquiring more shares.

Eligible retail investors can apply for shares via their broker, wealth manager or other intermediaries. To be eligible investors must be a customer of a participating intermediary or other organisation. The minimum subscription is £100. The total amount to be raised via the retail offer will be no more than €8m.

The issue price will be at a 0.6% premium to the last published cum-income NAV/share prior to the close of the fundraising. In the past year, the investment trust shares have been trading at an average premium of 1.19%.

The retail offer is expected to close at 1pm on 20 February and the issue price should be announced on the same day. The result of the retail offer should be announced the following day. Applications could be scaled back.

Microsoft, Amazon and NVIDIA are the three largest investments in the investment portfolio, accounting for 17.3%. The top ten investments account for 39.3% of the portfolio.

JPMorgan Global Growth & Income is paying quarterly dividends of 4.61p/share. The latest NAV is 528.14p/share, while the market price is 531.5p.

Ultimate Products considering buy backs with surplus cash

Andrew Hore
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Ultimate Products considering buy backs with surplus cash

Homeware brands owner Ultimate Products (LON: ULTP) says interim revenues have fallen because of lower supermarket orders as they ran down their stocks. However, margins are improving. Cash generation is strong enough to consider share buy backs.

The current policy is to pay 50% of earnings in dividends. Over the current 12-month period, net debt is expected to halve to £7.4m and Ultimate Products could move into a net cash position within two years on current expectations. Management wants to retain a level of gearing because it believes that it is capital efficient.

In the six months to January 2024, revenues were 4% lower at £84m. As well as destocking, the closure of Wilko held back progress. Freight rates have fallen during the period. The improved margins mean that there could be small uptick in interim pre-tax profit.

The company’s brands include Salter and Beldray. Stock positions are returning to normal levels and that provides hope for the second half.

Andrew Gossage has moved to chief executive, while the previous incumbent Simon Showman has moved to chief commercial officer. Interim results will be published on 9 April.

Shore Capital is maintaining its 2023-24 pre-tax profit forecast at £18.4m, up from £16.8m. At 147p, the prospective multiple is less than ten with share buy backs potentially enhancing earnings in the future. The forecast dividend of 7.8p/share provides a yield of 5.1%.

AIM movers: Renalytix share price soaring and Saietta still needs cash

Andrew Hore
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AIM movers: Renalytix share price soaring and Saietta still needs cash

Shares in Renalytix (LON: RENX) have been on the rise since the Nasdaq market opened yesterday. There has been a further 28.3% increase to 59p this morning. There has been a 449% rise over five days. Last week. the Centers for Medicare and Medicaid Services published a draft local coverage determination for Renalytix for KidneyIntelX and kidneyintelIX.dkd. The Medicare price is $950/test. The specified coverage is for patients with diagnosed Tupe 2 diabetes and Stage 1-3b Chronic Kidney Disease. The loss making company will start to build up revenues, but it is likely to need additional cash.

Waste to energy technology company Eqtec (LON: EQT) has received a £500,000 subscription at 2.35p/share from Verde Corporation and could get up to £1m more at 4.75p/share. Loans totalling £406,000 from Altair Group and Pitcole Ltd have been converted into shares. YA II PN and Riverfort Global are talking to a potential buyer of their 10.2 million shares. They will still own 26.4 million warrants exercisable at 7.87p each, as well as syndicated debt of £600,000. The share price increased 16.7% to 2.8p.

KEFI Gold and Copper (LON: KEFI) says the funders of the Tulu Kapi gold project will seek approval of the transaction from their respective committees. The Ethiopian government has reaffirmed its equity investment. The project launch should be in the first half of 2024. The total investment is $320m. The share price improved 16.8% to 0.669p.

Portable oxygen equipment developer Belluscura (LON: BELL) has a new partnership with Chicago-based Sunset HealthCare Solutions, which will offer the X-PLOR portable oxygen concentrator to more than 1,600 businesses. It will then offer the DISCOV-R POC when it is available. The share price is 7.5% higher at 21.5p. Belluscura has received 95.7% acceptances from shareholders in standard list shell TMT Acquisition (LON: TMAA). The offer is open for a further 14 days.

FALLERS

Electric drivetrain developer Saietta Group (LON: SED) has failed to secure an electrical steering pump contract manufacturing opportunity and it may sell the relevant production line for £600,000. That would help its short-term financial position. Cash was expected to last until March and additional funds will still be required. Discussions continue with potential OEM customers. The share price slumped 54.7% to 7.25p.

Trading in Artemis Resources (LON: ARV) shares has resumed on ASX and the AIM share price has lost most of its previous gains falling 39.7% to 0.95p. Trading was halted on 8 February and the share price is still higher than the 0.825p on that day. Yesterday, Artemis Resources published an update on the West Pilbara project exploration. This shows potential sub vertical orientation of pegmatites at Kobe and Osborne. The first drill hole potentially stopped short of the Osborne target. A drilling programme to test Osborne is planned for March to test near surface lithium rich zones.

Neometals (LON: NMT) says a review of the Spargos project in Western Australia indicates low potential for lithium-bearing pegmatites. Sampling did not produce any significant results. There will be field mapping to investigate two potassium anomalies and a strategic review of the project. The share rice dipped 6.25% to 7.5p.

Dekel Agri-Vision (LON: DKL) produced 2,839 tonnes of crude palm oil in January, an increase of 56% on the previous January. Prices weakened and were around €737/tonne, although there are signs of improvement. WH Ireland had assumed €850/tonne for the full year. Input costs have decreased. New equipment has been ordered for the cashew processing operation and that will help increase production. The share price is 7.41% lower at 1.25p.

TUI AG shares gain as customer numbers and revenue surge

UK Investor Magazine
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TUI AG shares gain as customer numbers and revenue surge

Europe is in the midst of a holiday boom with companies from travel operators to airlines posting surging customer numbers and revenue.

TUI AG joined the party today with strong interim results pointing to a 15% increase in revenue in the first quarter as higher demand and improving prices helped lift the top line.

After a promising winter booking season, summer bookings have proved to be robust, and the group’s total bookings across all seasons are 8% ahead of last year.

The company said it reaffirmed its full-year guidance of revenue increasing 10% and EBIT expanding by 25%.

Such growth in revenue and earnings clearly pleased investors on Tuesday with TUI AG shares 3% higher at the time of writing.

“TUI has reported record sales as resilient consumers take to the air. Cost of living pressures and economic uncertainty aren’t stopping us from making our sunny getaways. A lot of the operational work TUI has done means it’s in a better position to capture this demand. Efforts to expand higher-end offerings in its hotel portfolio is a shrewd move and could help it remain competitive if lower earners start to pull back on booking holidays,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.

However, Lund-Yates continued to caution that the group may suffer when the boom in demand for holiday’s were currently experiencing recedes.

“TUI operates a hefty cruise business too, and the cash flow dynamics of operating enormous ships makes it more exposed if and when holiday spending starts to wane. So while the group’s done pretty much everything it can within its control, there remains an element of uncertainty. Unlike airlines with short-haul focus, a lot of TUI’s routes fall into the more expensive medium-haul bucket, further increasing risk. 

“There are questions swirling about TUI’s potential decision to drop its London listing. The added complexity and cost of maintaining dual listings since Brexit has seen others decide to go down a similar route. While it does little to change the business case, the optics for London are less than ideal.”

Did Naked Wines retain the wrong business?

Andrew Hore
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Did Naked Wines retain the wrong business?

Online wine retailer Naked Wines (LON: WINE) sold the Majestic Wine business in 2019. The difference in the financial positions of the AIM company and the acquirer is indicated by the early payment of the vendor loan note related to the transaction.

CF Bacchus HoldCo was used as the acquisition vehicle by Fortress Investment. The initial payment was £78m in cash and the £12m loan note. There was a £175,000 deferred payment, out of a potential £5m, related to the UK’s regulations following the exit form the EU. CF Bacchus bought two Calais stores in the deal and sales slumped, so they were ...

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