Arc Minerals encounters significant copper mineralisation

Jamie Gordon
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3
Arc Minerals encounters significant copper mineralisation
African-continent-based Copper, Gold and Cobalt mining company Arc Minerals Ltd (LON: ARCM) has announced that it has come across ‘significant copper mineralisation‘ at the Cheyeza East venture, in what was the Company’s maiden drill programme. Of the two holes drilled, it was the second that intersected and identified the zones of significant mineralisation at Cheyeza East, the company said.

Arc Minerals comments

On the Cheyeza East target area, the Company said in its statement:

“The Cheyeza Target Area was one of several areas identified by both the geophysics and geochemistry work programs completed last year. As reported on the 5th June 2019, of particular interest is a 3km by 0.8km area at Cheyeza East where up to 2,792 ppm copper in the soils has been identified and where these two initial holes were drilled.”

“Drilling is continuing at Cheyeza East to test its full extent, both along strike and down dip.”

In response to today’s updates, Arc Minerals Executive Chairman Nick von Schirnding attached the following statement to the press release:

“This has been a very satisfactory start to our drilling campaign in Zambia and I am pleased to see that the anomaly identified by the detailed geophysics and geochemistry completed last year has produced results. The drill cores have now been sent for assay and we expect results imminently. Additionally, we have identified another significant anomaly in the west of our licence areas and a further update will follow.”

Investor notes

Following the news, the Company’s shares saw a healthy rally of 6.38% or 0.15p during trading on Thursday, up to 2.5p per share.

Elsewhere in the mining sector, recent updates have come from; Ferrexpo Plc (LON: FXPO), Altus Strategies Plc (LON: ALS), Kefi Minerals plc (LON: KEFI) and Galantas Gold Corp (CVE:GAL).

FairFX gains credit broker licence and changes name to Equals Group

Jamie Gordon
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1
FairFX gains credit broker licence and changes name to Equals Group
E-banking company FairFX (LON: FFX) announced that it would change its name to Equals Group (LON: EQLS) with recent developments to company structures and functions leading the change.

FairFX – Equals Group name change

The Company said the change reflected an evolution, and ultimately the reduced importance of its FX (Forex) business. “The decision to change the Company’s name reflects the evolution of both its operations and product offering, which have diversified in recent years beyond the heritage foreign exchange businesses of international payments and travel money, and further into integrated money management solutions for consumers and businesses, covering banking and payments.”

“Since 2017, the Group has almost tripled in size in terms of turnover and its operations have broadened into three significant businesses – FairFX, CardOneMoney and City Forex. The unification of these businesses under a new, distinctive brand will provide further benefits for the Group in terms of supply chain management and efficiency. Whilst foreign exchange expertise and revenues continue to be integral to the Group, the increasing importance of non-FX related activities necessitated a change to a new umbrella brand identity, under which all the services of the Group can be represented. The Group believes this will approach will also optimise customer acquisition, retention and engagement.”

The Company said that the Equals Group brand would be rolled out across its range of products through the course of 2019. It added that this programme would be completed by the year’s end and would ‘optimise cross-selling of products’. In response to the name change, Company CEO Ian Stafford-Taylor said: “The inspiration for the new name comes from a simple piece of insight: that our relentless focus on solving everyday problems by applying our ingenuity equals a better way for our customers to manage their money. Ultimately, we’re helping them to save time and money with a more human touch; an approach which has built great customer loyalty in our business. With a series of new products set to launch in the second half of the year, which will strengthen our position in the SME money management space, it’s a truly exciting time for us and our customers to be moving forward as Equals.”

Credit Broker Licence

The company announced that through its subsidiary – Spectrum Payment Services Ltf – it had been granted permission to provide credit facilities by the FCA. This step forward allows the group to act as a broker for loan products to its SME and retail clients. With FairFX (or Equals Group) acting as broker, all loans will be provided by third parties authorised by third party lenders. The loans will not appear on FairFX’s balance sheet and there will be no credit risk for the Group.

“Having achieved this regulatory status, following significant investment in its digital banking platform in 2018 and 2019, the Group expects to launch an innovative, highly digitised revolving credit product in partnership with iwoca – an award-winning specialist lender to SME’s – in the coming months. It is intended that this will help small and medium sized businesses to apply and receive a decision in minutes and immediately receive funds. Business customers will be able to choose to receive funds directly into their account or onto prepaid card, either virtual or physical, which will be issued by FairFX Group under its Mastercard membership. With the benefit of FairFX’s membership of Faster Payments, funds could be spent directly and immediately; for instance, in cases where stock needs to be purchased or an urgent invoice be settled.” The Company said in its statement.

In response to this update, Managing Director of Banking Products at FairFX, Adam Rigler, commented: “I am delighted to be able to make this announcement as it is a key milestone on our journey to offering a full range of services to our customers. We now have a clear road ahead to roll out our card-based revolving credit product in the near future, which will radically simplify the process of applying for a receiving funds for a small or medium sized business.”

Investor notes

The Company’s shares are currently trading down 1.21% or 1.5p at 123p per share as of Thursday afternoon 27/06/19 14:56 GMT. As of the end of June, the Company’s P/E ratio stands at 71.10.

Elsewhere in the e-banking and fintech sector, there are updates from; PayPal (NASDAQ: PYPL), Nationwide (LON: NBS) and Klarna Bank.

Itaconix losses narrowed by restructuring

Jamie Gordon
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2
Itaconix losses narrowed by restructuring
Chemical producer Itaconix PLC (LON: ITX) posted a narrower loss on-year, in its latest round of results. The Company attributed the narrowed loss to a restructuring programme undertaken in 2018 – the result of which was a cut to costs by £2 million a year. Pre-tax losses narrowed from £10.17 million to £7.26 million on-year, and revenues grew from £0.55 million to £0.66 million, with product revenues up 12.9% from £0.54 million to £0.61 million. Despite losses persisting, the group remain positive and place confidence in revenue growth in their polymer technology platform in 2019.

Itaconix comments

In response to the results, Company CEO John R. Shaw commented: “We are positioned for revenue growth and a focus on profitability with a reduced cost base and global partners in place for our current major products. While the ramp up in 2019 sales was initially delayed, revenue growth is accelerating, with underlying pre-tax losses for the full year decreasing and remaining in line with expectations.” In his report, the Company CEO added: “In June 2018, we announced the downsizing of our research, development, marketing, and administrative operations in Deeside, Wales, to focus on revenue growth and profitability in our three core product areas. As of February 2019, the Group had no employees at the facility.” “After raising new funds and significantly reducing our cost base in 2018, the pace of revenue growth from the uptake of our existing polymers into customer formulations remains our primary focus and the key dynamic to monitor for managing our costs and our cash to reach profitability. The Board firmly believes that the products, active customer projects, and global partnerships are in place to increase overall use of our polymers, gain larger accounts, and generate significant new revenue growth going forward.” It is worth noting, however, that uncertainty persists: “Ultimately, it is uncertain whether our range of Itaconix products will be purchased in sufficient quantity for the Group to be successful in the commercial market. Progress in 2018 has been made to address costs whilst looking to fill unused capacity through developing existing and new commercial partnerships.”

Investor notes

The Company’s shares dipped in morning trading on Thursday, down 5.43% or 0.12p a share to 2.18p per share 27/06/19 12:47 GMT. Other recent losses in the chemical and medical tech related sector include; Surgical Innovations Group Plc (LON: SUN), ValiRx Plc (LON:VAL) and NetScientific PLC (LON:NSCI).

Wincanton continues meeting expectations ahead of AGM

Jamie Gordon
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1
Wincanton continues meeting expectations ahead of AGM
British logistics provider Wincanton plc (LON: WIN) announced today that it continued to trade in line with expectations. The update came as part of the Company’s official AGM statement released to investors and press, in which the company confirmed news of the five year contract it had won with Morrisons Supermarkets (LON: MRW), which entailed providing transportation to the supermarket’s stores from three distribution facilities.

Wincanton AGM statement

The Company announced the AGM statement, “Wincanton, a leading provider of supply chain solutions in the UK & Ireland, will hold its Annual General Meeting today at 11 am at the offices of Buchanan, 107 Cheapside, London, EC2V 6DN, at which Dr Martin Read CBE, Chairman, will make the following statement:” The AGM statement read as follows:

“The Board confirms that Wincanton continues to trade in line with expectations.”

“As previously announced on 14 June 2019 Wincanton has been appointed by Wm Morrison Supermarkets PLC (“Morrisons”) to provide transportation services from three distribution centres to its stores. The new five-year contract will see Wincanton manage all transportation planning and operations from the three locations to support Morrisons’ network of stores. Wincanton will also be responsible for vehicle maintenance through its fleet management business, Pullman Fleet Services, at five Morrisons sites.”

“As set out in our Full Year results, a final dividend of 7.29p per share in respect of the year ended 31 March 2019 will be payable, subject to approval at today’s AGM, on 2 August 2019 to those shareholders on the register on 5 July 2019.”

Investor notes

The Company’s shares dipped slightly in morning trading on Thursday, down 0.75% or 2p to 265p a share. Numis and Liberum Capital analysts were in consensus, with both reiterating their respective ‘Buy’ stances on Wincanton stock.

Zoo Digital shares rally despite posting full-year loss

Jamie Gordon
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4
Zoo Digital shares rally despite posting full-year loss
Cloud software provider Zoo Digital Group plc (LON: ZOO) announced that it had swung to a full-year loss owing to shrinking margins. The company were able to book a rise in revenue to $28.8 million. However, this success was offset by the Company booking a $1.3 million loss for the full year through March, down $6.3 million from the $5 million profit on-year. Further, the Company’s adjusted Ebitda fell from $2.4 million to $0.4 million, with its Ebitda margin also shrinking from 8.4% to 1.4%.

Zoo Digital CEO comments

With an unsurprisingly optimistic outlook, Company CEO Stuart Green alluded to the effects of the contracting DVD and Blu-ray market in his reaction to the update:

“We have worked hard over the course of the year to enhance our offering, build up our network and differentiate ourselves further from the competition. ZOO now has the technology, the people and the local expertise to enable our clients to deliver content across multiple territories and in multiple languages simultaneously and efficiently. To be chosen as a primary vendor of localisation services for large media companies requires us to demonstrate significant global capacity, and in this regard, we have made excellent progress that puts us in good stead as we continue to grow.”

“Trading in the new year has begun well. Whilst the significant decline in legacy DVD and Blu-ray formats in our digital packaging segment has continued, now leading us to not forecast any significant income from this business line in the future, this has been offset by strong growth related to Over-the-Top (OTT) delivery. We expect ZOO to be confirmed as a preferred vendor to a greater number of clients and lines of business during the course of the year ahead. Our caution around timing is reflective of the dynamic nature of the OTT marketplace and recent experience.”

“The end market into which we are selling our cloud-powered services continues growing and the traction that we are gaining with each of our services gives us great confidence that the business is well placed to meet opportunities and growth in the years to come.”

Price Monitoring Extension

Shortly after posting their recent round of results, the Company posted another regulatory update, informing investors and press that they were to undertake a second price monitoring extension. “A second and final Price Monitoring Extension has been activated in this security. The auction call period is extended in this security for a further 5 minutes.” “Following the first price monitoring extension this security would still have executed more than a pre-determined percentage above or below the price of the most recent automated execution today. London Stock Exchange electronic order book users have a final opportunity to review the prices and sizes of orders entered in this security prior to the auction execution.”

Investor notes

The Company’s shares have rallied during trading on Thursday morning, up 8.77% or 5p to 62p a share. Analysts from finnCap have reiterated their ‘Corporate’ stance on Zoo Digital stock for the second time in June. Elsewhere in the tech sector; 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.

Klarna and H&M expand partnership to include US market

Dina Caruso
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0
Klarna and H&M expand partnership to include US market
Fashion retailer H&M and Swedish bank Klarna announced on Thursday that they have expanded their current partnership to include the US market. H&M and Klarna are aiming to further integrate H&M’s digital and physical stores to provide a “seamless” shopping experience to consumers. The partnership, which covers all H&M channels online and in-store, will provide smooth payments and include Klarna’s “Shop Now, Pay Later” scheme. Klarna Bank, the Swedish fintech company founded in 2015, recently received an investment by the American singer, rapper, record producer, television personality, entrepreneur and actor, Snoop Dogg. He also promoted the business as part of a marketing campaign where he was renamed as “Smooth Dogg”. Snoop Dogg’s investment firm, Casa Verde, has previously added cannabis companies to its portfolio. Klarna took to Twitter to announce the growth of the partnership: https://platform.twitter.com/widgets.js “Shopping at H&M should be convenient, relevant and inspiring and we are happy to soon offer fashion fans in selected markets a whole new way of paying their fashion finds. Klarna has helped us develop an H&M-unique payment solution that offers our fans a truly modern shopping experience no matter where and how they choose to shop,” Daniel Claesson, Head of Business Development at H&M Group, commented on the announcement. “The foundation of the Klarna and H&M partnership is a commitment to continuously develop smarter, simpler and engaging shopping experiences. The future of retail is a high touch experience across channels which will delight customers, drive value and build loyalty,” Michael Rouse, the Chief Commercial Officer at Klarna, added. H&M also revealed on Thursday that it has experienced a bright start to the summer season as sales are estimated to rise for the month of June, sending shares up over 9%. Shares in H&M Hennes & Mauritz AB (STO:HM-B) were trading at +9.42% as of 12:26 CEST Thursday.

UK car production falls for 12 consecutive months, no-deal Brexit “not an option”

Dina Caruso
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2
UK car production falls for 12 consecutive months, no-deal Brexit “not an option”
UK car manufacturing has dropped for 12 consecutive months, new data on Thursday from the Society of Motor Manufacturers and Traders (SMMT) reveals. A no-deal Brexit is “not an option” now for the automobile sector, according to the Chief Executive of SMMT. According to the industry body, UK car production dropped 15.5% in the month of May, as 21,239 fewer units were manufactured throughout the month. Overall output for the year is now down 21% as May’s drop contributes to 12 consecutive months of decline. The decline in overall UK output is partly caused by some manufacturers deciding to bring forward plant shutdown plans to April, in anticipation of the original Brexit date in March for the UK’s departure, the SMMT said. “12 consecutive months of decline for UK car manufacturing is a serious concern and underlines yet again the importance of securing a Brexit deal quickly. The sector is facing multiple seismic challenges simultaneously: technological, environmental and economic,” SMMT Chief Executive Mike Hawes commented on the data. “The ongoing political instability and uncertainty over our future overseas trade relationships, most notably with Europe, is not helping and, while the industry’s fundamentals remain strong, a brighter future is only possible if we secure a deal that can help us regain our reputation as an attractive location for automotive investment. No deal is not an option,” the Chief Executive continued. A no-deal Halloween departure form the European Union could be scary for the automobile sector. For the month of May, manufacturing for domestic buyers fell by 25.9%, whilst overseas orders were down 12.6%. Exports accounted for 80.9% of all cars produced, which underlines the importance of maintaining free and frictionless trade, the SMMT said. In UK politics, the race to lead the Conservative Party is reaching its final lap with Boris Johnson and Jeremy Hunt as the final two candidates to contest the party’s leadership.

Essentra announces acquisition of Innovative Components

Jamie Gordon
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0
Essentra announces acquisition of Innovative Components
Milton Keynes-based plastic and fibre product supplier Essentra PLC (LON: ESNT) announced today that it had acquired US company Innovative Components. The Company completed the acquisition of Innovative Components for an undisclosed cash-free, debt-free consideration funded from ‘existing facilities’, and said it would report its new addition under its components division. ICs manufacturers pins, handles and knobs in the North American market. Attached to the update, Essentra posted ICs’ revenues for the full-year ended 31 December 2018, which stood at $11 million.

Essentra comments

“Essentra plc (“Essentra” or the “Company”) today announces it has acquired 100% of the share capital of Innovative Components Inc. and Componentes Innovadores Limitada for an undisclosed cash consideration.” “Headquartered in Chicago, US, Innovative Components is one of the leading manufacturers and distributors of knobs, pins and handles in North America for a broad range of end-markets, and will be reported under the Company’s Components division. The acquisition of Innovative Components builds the division’s product offering in the US, provides range extension opportunities in Europe and Asia and adds attractive low-cost manufacturing capability in Costa Rica.” In response to the update, Company Chief Executive Paul Forman, said, “As a leading provider of knobs, pins and handles, Innovative Components both strengthens and extends our product range while adding further valuable manufacturing capacity in the Americas. Innovative Components is a strong strategic fit with our own successful hardware business and another example of the attractive acquisition opportunities available to our Components division. As the last few months has demonstrated, we are continuing to combine the successful stabilisation of our businesses to generate stable organic growth with the active management of our portfolio.

Investor considerations

In early morning trading on Thursday, the Company’s share price rallied modestly 0.19% or 0.8p to 421.2p a share. Analysts from Numis, Peel Hunt and Deutsche Bank were in consensus, with all three reiterating their ‘Buy’ stance on Essentra stock.

H&M shares rise as summer sales begin brightly

Dina Caruso
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2
H&M shares rise as summer sales begin brightly
H&M said on Thursday that it has begun the summer season well as sales are estimated to rise for the month of June. Shares in the fashion retailer (STO:HM-B) rose over 9% on the announcement. The Swedish company said in its half-year results that sales of the summer collections got off to a “very good” start. Net sales in the month of June is predicted to grow by 12% in local currencies compared with the same month a year earlier. As for its half-year results, the company’s net sales increased by 11% from 1 December 2018 to 31 May 2019. In local currencies, net sales increased by 5%. H&M, whose pre-tax profit for the second quarter amounted to 5.9 billion crowns, said that it also successfully launched an online store in Mexico during the quarter. “The H&M group continues to increase full-price sales, reduce markdowns and increase market share, showing that customers appreciate our collections and the improvements we are making to the product assortment and the customer experience,” said Karl-Johan Persson, CEO. “Sales developed well in most markets. We had strongest growth in countries such as the US where we grew sales by 17 percent, in Mexico by 25 percent, in India by 39 percent, in Russia by 19 percent and in Poland by 11 percent in local currencies. We also grew in the UK and Sweden where we took market share despite challenging market conditions,” the CEO continued. Indeed, several retailers have been struggling for survival in the UK with the development of the high street crisis. As tough trading conditions take their toll, British retailers have had to face staff cuts and store closures. In 2018, almost 2,500 stores were closed in the UK, with fashion retailers experiencing the second highest number of store closures on the high street. In December, H&M issued a trading update revealing a 12% rise in sales for the three months to the end of September, yet investors remained unconvinced by the group’s recover as shares dropped. As of 11:14 CEST Thursday, shares in H&M Hennes & Mauritz AB (STO:HM-B) were up 9.41%.

Superdry delays release of annual results

Dina Caruso
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1
Superdry delays release of annual results
Superdry (LON:SDRY) announced on Thursday that it will be delaying the release of its annual results. Shares in the company were trading just over 2% higher on Thursday morning. The British fashion retailer said in a statement that it will announce its preliminary results for the 52 weeks ended 27 April on 10 July, rather than on 4 July as previously stated. The company said that it will be making a non-cash onerous lease and store impairment provision in its full year results, which will benefit the underlying profit before tax in FY19 and subsequent years. It is because of the “complexity” of the work related to this, in addition to the company’s recent changes in management, that it will be delaying the publication of its results. Superdry has, however, said that underlying profit before tax for the financial year is expected to be in line with the revised market expectations published at the beginning of May. The fashion retailer kicked-off the month of May by issuing another profit warning in its trading update for the fourth quarter of the year. Superdry said that though group revenue was up 3.6% over the course of the year, full-year profit was likely to come in “below the range of market expectations”. Its founder Julian Dunkerton was recently re-appointed back to the board following a public disagreement with the company’s management. Dunkerton, who founded the brand in Cheltenham in 1985, returned to the company this year amid a series of profit warnings and after disagreeing with its strategy. The company had asked its shareholders back in March to reject Julian Dunkerton’s return to the board. Superdry joins the list of retailers struggling for survival amid the high street crisis to hit the UK. Indeed, the fashion retailer saw its half-year profits crash 49% at the end of last year. Shares in Superdry plc (LON:SDRY) were up 2.23% on Thursday as of 09:19 BST.
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