Midwich Group sees growth in European and Asia Pacific operations

Jamie Gordon
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2
Midwich Group sees growth in European and Asia Pacific operations
Specialist audio visual distributor Midwich Group PLC (LON: MIDW) has seen its share price rally after posting a positive trading update fro the six month period ended 30 June 2019. The Company said it organic growth especially in its Continental European and Asia Pacific operations, which was led by contributions from its recent acquisitions. Midwich added that H1 cash generation was ahead of Board expectations and that the Company expected cash generation for the full year to be in line with the Group’s average performance. The Board’s guidance for the Group’s full-year performance remained unchanged.

Midwich Group statement

The Company’s statement elaborated,

“The Group has traded well in the first half, with top line organic growth being supported by a strong contribution from recent acquisitions. Growth was achieved across all geographies on a constant currency basis, with Continental Europe and APAC performing particularly well. Overall gross margins have improved marginally on the prior year period. The Group continues to invest in the infrastructure to develop its business, in particular the central acquisition and integration teams, as well as its start-up businesses in South East Asia and Benelux. The Group has acquired four businesses in the year to date and all are developing as expected. These businesses have given the Group access to three new geographical territories (Italy, Switzerland and Norway) as well as strengthening its capabilities in the audio and lighting segments.”

Investor notes

Following the update, the Company’s shares rallied 3.64% or 20.00p to 570.00p a share 22/07/19 12:02 BST. HSBC analysts initiated a ‘Buy’ stance on Midwich Group stock. Elsewhere in the tech sector, there were updates from; Boku Inc (LON: BOKU), Telit Communications Plc (LON: TCM), TP Group PLC (LON: TPG), Mobile Streams Plc (LON: MOS), Sophos Group plc (LON: SOPH) and MiriAd Advertising plc (LON: MIRI).

Lagan boost for Breedon

Andrew Hore
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0
Lagan boost for Breedon

Aggregates company Breedon (LON: BREE) has a strong growth record and interim figures on 25 July will show if this is continuing. Peel Hunt believes that annual earnings per share growth should average high single digits over the next three years and it could be higher if the right acquisitions can be found.
However, there is a concern about what will happen to the stake owned by St James’s Place, which has already been cut from 6.4% to 2.9% in just over one month. This stake appears to have been inherited in the fund that was previously run by Woodford Investment Management.
Also, outgoing c...

US prospects for Joules

Andrew Hore
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1
US prospects for Joules

Fashion brand Joules (LON: JOUL) has already announced that pre-tax profit for the year to end May 2019 will be ahead of previous expectations at around £15.3m. Tuesday’s announcement will provide some indications about the UK retail environment for the company and its international growth potential.
Joules joined AIM in May 2016 after it raised £66m at 160p a share and at one stage the share price had more than doubled, although it has fallen back. It is still above the flotation price at 257p.
Sales
Overall revenues were 17% ahead at £218m, which is underlying growth of 13%. Retail sales w...

Cora Gold shares bounce on high grade gold discovery

Jamie Gordon
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1
Cora Gold shares bounce on high grade gold discovery
Western Africa focused gold company Cora Gold Ltd (LON: CORA) reported high grade gold mineralisation at the Sanankoro Gold Project, located at the Yanfolila Gold Belt in Southern Mali. The Central Selin Prospect results displayed dulphide mineralisation of 22 metres at 2.68g/t from 51 metres, 9 metres at 3.07g/t from 117 metres and 8 metres at 3.12g/t from 114 metres.

The Company’s 1-2 million ounces of gold exploration target from October 2018 was based on mineralisation up to 100 metres and did not account for mineralisation at depth.

The Group also announced the drilling of five reverse circulation holes drilled to target sulphide beneath known gold oxide mineralisation.

Cora Gold comments

Company CEO, Jonathan Forster, added the following insights,

“I am pleased to report that Cora’s exploration drill programme, which has progressed on schedule and on budget, intersected gold mineralisation on each deeper drill hole at the Selin prospect, often at grades of more than 3g/t gold. Such promising results support earlier indications that the sulphide potential at Selin could be significant, providing justification for a future drill programme that would aim to extend the gold mineralisation at depth.”

“This set of results consists of the initial, preliminary testing of a strike-length of up to just 300m of the sulphide gold mineralisation that is believed to lie underneath the 2,000m long gold oxide zone previously identified at the Selin prospect. With the sulphide zone lying at depths of typically greater than 60-80m, these initial drill holes are still considered to be near surface with open pit mining potential.”

“A previously unknown gold zone was identified in the oxide part of a deeper hole, highlighting the ongoing opportunities to make new discoveries at Sanankoro. We look forward to updating the market with further results over the coming months.

Investor notes

The Company’s shares jumped 27.25% or 1.09p during Friday trading, up to 5.09p a share 19/07/19 16:21 BST. Elsewhere in the mining and minerals sector, recent updates have come from; Kavango Resources PLC (LON: KAV), Ariana Resources plc (LON: AUU), Rio Tinto plc (LON: RIO), Bushveld Minerals Limited (LON: BMN) and Anglo Asian Mining plc (LON: AAZ).

Van Elle profitability impacted by end-market volatility

Jamie Gordon
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0
Van Elle profitability impacted by end-market volatility
UK focused ground engineering contractor Van Elle Holdings PLC (LON: VANL) has seen its profits hampered by volatility for the full year 2019. For the year ended 30 April 2019, and before the official publication of its results on 24 July, today’s statement offered a largely anticipated overview of a difficult year for the Company. Van Elle noted that second half profitability was impacted by end-market volatility and project slippages. While the Board had expected to report adjusted profit before tax of £5.0 million, it deemed it necessary to, “adjust a small number of specific balance sheet items and contract accruals.” These adjustments will ‘adversely’ affect FY19 profit by c.£0.5 million the Company said. Year end net debt is in line with expectations as laid out on 25 April 2019.

Van Elle Statement

The Company’s statement continued,

“Whilst an update on the outlook for FY2020 will be provided at the time of the results, it should be noted that, despite the encouraging momentum at the end of last year, the Group is continuing to experience customer uncertainty in some of its markets, resulting in a quiet start to the year in some segments and increased volatility in month on month performance. As set out in April, the Group has been successful in securing positions on attractive, long term contracts. Although the Company is seeing the benefits of a number of commercial and operational initiatives recently implemented, the Board is mindful that market uncertainty and the resultant volatility may persist further into the current financial year, which would limit the rate at which progress can be made.”

Investor notes

The Company’s shares have dipped 2.47% or 0.90p to 35.60p a share 19/07/19 14:29 BST. Peel Hunt analysts downgraded their stance on Van Elle Holdings stock from ‘Add’ to ‘Hold’. Elsewhere in development and engineering news, there have been updates from; Persimmon plc (LON: PSN), MJ Gleeson PLC (LON: GLE), Somero Enterprises Inc (LON: SOM), Bovis Homes Group plc (LON:BVS) and Telford Homes plc (LON: TEF).

John Laing EAG acquires two Yorkshire hydro power stations

Jamie Gordon
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3
John Laing EAG acquires two Yorkshire hydro power stations
Operator of privately financed public sector infrastructure projects, John Laing Environmental Assets Group Ltd PLC (LON: JLEN) announced today that it had acquired Yorkshire Hydropower Holdings Limited. The Company stated that the acquisition required a consideration of £4.3 million, with YHHL holding 100% of the equity in Yorkshire Hydropower Limited. This transaction represents the Company’s first investment in hydro power and expands on their existing environmental infrastructure projects. YHHL has been acquired from a group of high-net-worth investors, and holds the rights to two operational hydro projects and a battery storage system. The first Yorkshire based project is Kirkthorpe hydro, a 500kW single turbine hydro project located on the River Calder. The second is Thrybergh hydro, a twin screw 260kW hydro project located on the River Don. The final component is a 1.2MW battery co-located at Thrybergh.

John Laing comments

Richard Morse, Chairman of JLEN, said,

“We are pleased to make our first investment into two new asset classes in run-of-river hydro and battery storage. These projects have a proven operational history, benefit from strong contractual revenues and broaden the diversification within the JLEN portfolio. Furthermore, they demonstrate the synergistic benefits of co-locating renewable energy generation and storage technology.”

The Company’s statement also enclosed the following,

“Both hydro projects are accredited under the 20-year Feed-in-Tariff scheme. The battery storage project at Thrybergh is currently dedicated to a Firm Frequency Response contract.”

“This acquisition increases the total capacity of renewable energy assets in the JLEN investment portfolio to 281.16MW.”

“The acquisition was funded by the group’s internal cash resources.”

Investor notes

The Group’s shares dipped 0.27% or 0.33p to 121.42p a share 19/07/19 14:08 BST. There have been recent renewable energy updates from; SIMEC Atlantis Energy (LON: SAE), Aquila European Renewables Income Fund (LON: AERI) PowerHouse Energy Group (LON: PHE), The Renewables Infrastructure Group Ltd (LON: TRIG) and Tekmar Group Plc (LON: TGP).

SSP Group sees revenues grow in Q3

Jamie Gordon
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3
SSP Group sees revenues grow in Q3
British airport and train station focused catering company SSP Group PLG (LON: SSPG) saw further progress in its financial performance during the Company’s third quarter, despite what continues to be an uncertain period for the air travel sector. The Company said it made progress on its strategic initiatives during the third quarter, with revenues up 9.2% on a constant currency basis. This was comprised of a like-for-like sales growth of 2.0% and net gains of 7.2%. Based on actual exchange rates, Group revenues increased 10.3% year-on-year during the period. For the first three quarters from 1 Octoebr 2018 to 30 June 2019, Group revenues increased 7.6%. This included; like-for-like sales growth of 2.0%, net contract gains of 5.2% and 0.4% due to the impact of Stockheim. On an actual exchange rate basis, Group revenue increased by 8.3% on-year. SSP Group said their expectations remained unchanged for the full year.

SSP Group statement

With more in-depth insight, the Group’s statement read,

“In the UK, like-for-like sales growth was in line with our expectations, with stronger like-for-like sales growth in the air sector compared to rail. In Continental Europe, like-for-like sales continued to be held back by slower passenger growth in the Nordic countries and the impact of airport redevelopment activity in this region and in Spain. In North America, like-for-like sales growth was driven by increasing passenger numbers, although some of our airports have been impacted by the grounding of Boeing Max 737 aircraft and the transfer of passengers away from our terminals. In the Rest of the World, like for like sales growth has been mixed, with good performances in Egypt and the Middle East slightly offset, as anticipated, by the cessation of operations at Jet Airways in India and slower growth in China. Looking forward to the rest of the year, we anticipate like-for-like sales growth for the Group to be around 2%.”

“Net contract gains were good, driven by Continental Europe and North America, where the mobilisation of new contracts has been slightly ahead of schedule. Looking forward, we expect net gains in the full year to be slightly ahead of our expectations at around 5%, and as usual they will be accompanied by pre-opening costs.”

Investor notes

Following the update, the Company’s shares rallied 1.03% or 7p a share during Friday morning trading 19/07/19 13:00 BST. Shore Capital and Liberum Capital analysts reiterated their ‘Buy’ rating, while HSBC reiterated their ‘Hold’ rating and Morgan Stanley upgraded their stance from ‘Underweight’ to ‘Equal Weight’. Elsewhere, there have been updates from other food and drink retailers; Dominos Pizza Poland (LON: DPP), Premier Foods Plc(LON: PFD), Hotel Chocolat Group Plc (LON: HOTC), Distil PLC (LON: DIS) and Coca-Cola (NYSE: KO).  

Dominos Pizza Poland shares spike on H1 Systems Sales

Jamie Gordon
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2
Dominos Pizza Poland shares spike on H1 Systems Sales
Pizza delivery company Dominos Pizza Poland (LON: DPP) has seen its share price jump during Friday morning trading, with sales increasing especially in its online sector. The Group noted that System Sales grew 10% during H1 2019 on a year-on-year basis, with 80% of delivery sales coming from online orders. From March 2019, the Company said like-for-likes had been ‘building’, such as 6% growth in like-for-like order between March and June 2019. Operationally, Dominos Pizza Poland has 67 stores across 28 town and city locations, with 4 new stores having opened during H1 2019. Further, during the first half the Company agreed for three corporate stores to be acquired by two sub-franchisees and three to be taken under management by one existing sub-franchisee.

Dominos Pizza Poland comments

Nick Donaldson, non-executive Chairman of DP Poland, said, “The first half of 2019 has seen momentum return to like-for-like performance following the strong comparatives driven by TV advertising in January and February 2018. Like-for-like order count has grown 6% since March. Total System Sales grew 10% in the first half as a result of like-for-like performance and new store openings. Our efforts in sub-franchisee recruitment are bearing fruit with 2 additional sub-franchisees acquiring/agreeing to acquire 3 corporate stores between them this month We have also entered into 3 more management contracts with 1 of our existing sub-franchisees.”

Investor notes

The Group’s shares rallied 11.29% or 0.88p following the update, up to 8.62p per share 19/07/19 09:26 BST. Peel Hunt analysts reiterated their ‘Buy’ stance on Dominos Pizza Poland stock. Elsewhere, there have been updates from other food and drink retailers; Premier Foods Plc (LON: PFD), Hotel Chocolat Group Plc (LON: HOTC), Distil PLC (LON: DIS), Coca-Cola (NYSE: KO), Patisserie Holdings Plc (LON: CAKE) and Kerry Group Plc (LON: KYGA).

eve Sleep proves a nightmare

Andrew Hore
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0
eve Sleep proves a nightmare

Mattress seller eve Sleep (LON: EVE) is a great example of how overhyped companies can gain a fancy valuation, but the share price will slump when they get nowhere near to meeting expectations.
A Channel 4 programme brought eve Sleep to the attention of the consumer and investing public. That may have prompted an earlier flotation than might have happened, although it is difficult to know. This was certainly an immature business.
High hopes, low results
In 2016, prior to flotation, revenues were £12m and losses were nearly as high. Yet, when the company joined AIM in May 2017 it was valued a...

Young people most likely to get caught in the SVT trap

Dina Caruso
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0
Young people most likely to get caught in the SVT trap
The lack of financial education among young people is causing them to fall into the Standard Variable Tariff trap, new research from Comparethemarket reveals. The younger generation of bill payers is more likely to be on a Standard Variable Tariff, the research shows. Additionally, only 26% of 18-24-year olds know that you are automatically moved onto a Standard Variable Tariff when your current fixed energy contract expires, 7% less than adults in the UK. General knowledge regarding the cost of energy usage and monthly charges is also low among young people, as two in five are not able to say how much they pay monthly and nine in ten how much they pay per kilowatt. This is, however, something that the majority of bill payers are unable to understand. The research also shows that missing bill payments are more likely amongst young people, with nearly twice as many for 18-24-year olds, when compared to the average. “Making the right financial decisions from an early age can help set yourself up for a lifetime. For a young adult setting out on their own for the first time, taking on the responsibility of paying bills can be a daunting task,” Peter Earl, head of energy at comparethemarket.com, commented in a statement. “It’s crucial to take a little time out when it comes to choosing the right tariff for your circumstances. More often than not it makes financial sense to lock into a fixed rate tariff, which could save you hundreds of pounds a year on your energy bill.”
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