boohoo Group – Kumani, Ashley and Green involved in recovery discussions, with demerger of various brands under consideration 

Mark Watson-Mitchell
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boohoo Group – Kumani, Ashley and Green involved in recovery discussions, with demerger of various brands under consideration 

It has been reported over the weekend that there have been some ‘heavy’ discussions about the ongoing crisis within the boohoo Group (LON:BOO). 

Biggest shareholder in the online fashions empire is Mike Ashley’s Frasers Group (LON:FRAS), far outnumbering the holding of co-founders Mahmud Kumani and Carol Kane. 

And now, it is said, Philip Green, the former boss of the Top Shop retail chain, is getting involved in the discussions between the main players on just what to do with the boohoo debts and increased losses. 

Should the company sell off various of its various brand names and assets, with so many well-known concerns probably able to attract buyers or even shareholders in demerged operations. 

The group has a host of such interests being considered for ‘hiving off’ – like PrettyLittleThing, BoohooMan, Karen Millen, and Debenhams – could well be the answer to settling the boohoo debt crisis. 

But will the UK investing public be prepared to gamble any more of its funds on the Kumani empire? 

Especially now, like others within the online and retail fashion sector, suffering lost sales to the mega-sized Shein Group, which has been undercutting prices across the retail board with its women’s, kids, and men’s latest fashions. 

Shein, which sells several times more than those of ASOS and boohoo put together, has its official headquarters is in Singapore, while the majority of its staff and vendors remain in mainland China, including a network of more than 3,000 suppliers in Guangzhou, from where designs can be made up and delivered within a fortnight. 

The shares of the boohoo Group, where just under 5% of its equity is under short positions, are currently trading at around the 29.75p level, valuing it at some £377m. 

Avingtrans set for payback from transformational investment

Andrew Hore
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Avingtrans set for payback from transformational investment

Advanced engineering and medical technology supplier Avingtrans (LON: AVG) is in a strong position to develop over the next few years. The cost of developing the medical imaging technology is holding back short-term profit, but there is huge longer-term potential.

Avingtrans is heavily investing in developing compact 3D x-ray systems and the initial reaction to the technology is positive. The veterinary market is the first to be commercially exploited ahead of FDA approval for humans. There are also sales for non-destructive evaluation of products.

Management expects 510(k) FDA approval...

Aquis weekly movers: Hot Rocks Investments funding Oscillate acquisition

Andrew Hore
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Aquis weekly movers: Hot Rocks Investments funding Oscillate acquisition

Hot Rocks Investments (LON: HRIP) shares rose 80% to 0.225p on the back of an investment in Oscillate (LON: MUSH) to help it finance the acquisition of Quantum Hydrogen. The investment company is buying shares in Oscillate at 1p each and they come with a warrant exercisable at 2p.

Shares in Coinsilium (LON: COIN) recovered 16.7% to 1.75p. Interim revenues slumped to £3,000, but the digital services provider did move from loss to profit. That was due to a net fair value gain on financial assets of £336,000. Cash was £430,000 at the end of June 2024.

Igraine (LON: KING) had £84,000 in the bank at the end of June 2024, following an interim loss of £67,000. The board is evaluating new opportunities. The share price rose 11.1% to 0.25p.

Valerium (LON: VLRM) has launched VLRM Capital Management in Gibraltar and it will act as director of VLRM Capital Management VSA Private Fund. The fund will use volume spread analysis to generate returns. Valerium chairman James Formolli has invested £1m in the fund. The share price improved 11.1% to 7.5p.

Marula Mining (LON: MARU) has updated its mine development plan for the Kinusi copper mine in Tanzania. The infrastructure is suitable to support open pit mining and two-phase copper processing operation to produce copper cathode. The share price edged up 8.77% to 7.75p.

Wishbone Gold (LON: WSBN) is receiving A$55,000 from the Western Australian government towards exploration of the Nullagine tenements at Mosquito Creek. The share price increased 6.25% to 0.425p.

Invinity Energy Systems (LON: IES) joint venture development partner Gamesa Electric has ordered a 1.2MWh Mistral battery for a solar and wind generating site in Spain. This was announced at the same time as the interims, which were already well flagged. Interim revenues were £1.6m and the cash outflow from activities was £12.4m. The share price rebounded 2.8% to 9.25p, having been as high as 10p.

Phoenix Digital Assets (LON: PNIX) had net assets of 5.07p/share at the end of June. The share price improved 1.15p to 4.4p.

FALLERS

There were 2.62 million Visum Technologies (LON: VIS) shares traded on Wednesday and that led to a 72.7% decline in the share price to 0.15p.

Skin treatments developer Incanthera (LON: INC) says the initial launch of the SKIN + Cell is being expanded and the products will be in the European retail network of Marionnaud sooner than originally planned.  That is 1,200 outlets and this should be enough to move Incanthera into profit. Full timing of the launch is still being discussed. There are also plans for additional products. The share price slipped 11.6% to 23.7p.

Voyager Life (LON: VOY) says that M3 Helium, which it has an option to acquire, plans a second frack on the Nilson well. This is a fully funded programme with investors providing $170,000 for a 25% interest in the well. The share price fell 7.14% to 3.25p.

Ormonde Mining (LON: ORM) says cash decreased by €769,000 in the first half of 2024. Net assets were €5.06m at the end of June 2024, with cash of €1.54m. The share price declined 4.44% to 0.215p.

Director deals: Retirement sale no concern

Andrew Hore
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Director deals: Retirement sale no concern

There are many reasons why a director may want to sell shares. Franchised lettings and property sales business The Property Franchise Group (LON: TPFG) finance director David Raggett is retiring from the company. He is handing over the reins to Ben Dodd on 1 October, although he will continue to provide support the board after stepping down.

David Raggett sold 212,400 shares at 425p each. That leaves him with 448,277 shares. The reduction in exposure to the company and the spread of investment money makes sense when someone is retiring.

Business

The Property Franchise Group has grown...

AIM weekly movers: new targets for Cora Gold

Andrew Hore
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AIM weekly movers: new targets for Cora Gold

Cora Gold (LON: CORA) says exploration work at the Sanankoro gold project in southern Mali has identified twenty new targets within eight gold bearing structures – four primary and four secondary structures. There are seven key targets. This provides potential to extend the existing gold resource of 920,000 ounces. There are signs that the Mali government may lift the moratorium on issuing permits. The existing DFS was based on a gold price of $1,750/ounce and even at this price level the project would generate $71.8m of free cash in the first year. The share price jumped 80.6% to 2.8p.

Ovoca Bio (LON: OVB) reported a halved loss of €1.2m due to lower overheads. Cash was €2.9m at the end of June 2024 and cash refunds from the Australian government of €650,000 are anticipated.  The share price rebounded 55.6% to 1.05p.

Emmerson (LON: EML) is hopeful that it will receive the environmental permit for the Khemisset potash project in Morocco before the end of the year. There will also be the release of lab results from the second round of crop trials that examine the effectiveness of the potash providing phosphate to lettuces. Emmerson currently has $1.7m in cash. This should last well into 2025. The share price recovered 41.7% to 1.7p.

Retail software developer Itim Group (LON: ITIM) managed to breakeven in the first half of 2024 on a 19% increase in revenues to £8.8m. Net cash is £3m. Zeus upgraded its 2024 expectations to a loss of £700,000, down from £1m. Net cash should be £2.1m at the end of 2024. The share price rose 34.3% to 47p.

FALLERS

Deltic Energy (LON: DELT) is rising ahead of completion of the second farm-out of the Selene prospect, where Deltic Energy will retain a 25% interest. There was £3.7m in the bank at the end of June 2024. The share price had been hit by the withdrawal from the Pensacola discovery and the uncertainty concerning the North Sea oil and gas tax regime. Richard Sneller reduced his stake from 9.9% to below 3%. The share price dipped 43.7% to 5.35p.

Energy services supplier Enteq Technologies (LON: NTQ) has raised £1.5m from a placing and subscription at 5p/share. A retail offer could raise up to £500,000 and it closes on 30 September. The cash will help to finance the commercial launch of the SABER (Steer-at-Bit Enteq Rotary) tool. Testing with the first customer is ongoing. The fleet of SABER tools will be raised to ten. The share price slumped 42.9% to 5p.

Spirits supplier Distil (LON: DIS) is raising £650,000 at 0.12p/share with non-exec Roland Grain subscribing £200,000 and Dr Graham Cooley £90,000. The shares come with placing warrants exercisable at 0.36p each. Allenby has been appointed as broker. The cash will fund promotion and production of stock. The share price slid 35% to 0.13p.

Cancer diagnostics developer Angle (LON: AGL) reported a drop in interim revenues from £1.2m to £1m. The order book is worth £1.9m. The focus is developing pharma relationships and cutting annual costs by £8m by the end of 2024. There is £17.9m in cash and the outflow from operating activities was £6.8m. Management believes that Angle could become cash flow positive in the second half of 2026. The share price declined 28.3% to 8.25p. which is not far off the all-teom low in 2009.

FTSE 100 gains after S&P 500 closes at record highs

UK Investor Magazine
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FTSE 100 gains after S&P 500 closes at record highs

The FTSE 100 was comfortably higher on Friday as European stocks tracked US stocks higher after the S&P 500 closed at record highs.

A strong US tech sector built on a general optimism around the global economy to help fuel a broad equity rally that was felt on both sides of the pond.

As major Western banks started to cut rates, there was a feeling that China was the missing piece in the global growth story. The US is slowing, but not dramatically. Europe is softer, although there are no major concerns.

China has been the nagging doubt, and the decision to hold off on major stimulus until now had elevated these doubts to real concerns about how the property slowdown in China would play out and ramifications for the global economy.

With China now acting to help the ailing property sector – which China’s wealth effect is reliant on – global investor sentiment has rocketed higher this week.

The S&P 500 hit fresh record highs overnight, and if it weren’t for BP and Shell shares falling through the floor with oil prices, the FTSE 100 would likely have tested record highs this week as well.

Strong economic data from the US and a resurgent semiconductor sector helped propel US stocks amid wider optimism.

“A better than expected read out for weekly jobless claims helped allay fears of cracks in the labour market. There was also some relief that the final print for second quarter GDP growth was held firm at 3%,” said Derren Nathan, head of equity research, Hargreaves Lansdown.

“Semiconductor stocks also rallied led by memory chip maker Micron’s surge of 14.7%. after it released revenue guidance above market forecasts. This saw the optimism spread eastwards with Korean rivals Samsung and SK Hynix also seeing strong gains, topping off a strong week for Asian equities where a stimulus blitz unveiled by China’s government and central bank has seen Chinese equities enjoy their best week in over 15 years.”

Prudential was again the riser in London as the China trade continued in Friday’s session.

UK retailers were also enjoying the feel-good factor with Frasers Group and Sainsbury’s joining the rally.

Ceres Power order intake soars

Andrew Hore
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Ceres Power order intake soars

Fuel cell technology developer Ceres Power (LON: CWR) has a record order intake and it has reached £103.3m by the end of August. The interim loss more than halved and the cost base is being reduced by 15%. The share price rose 15.4% to 231.1p.

In the six months to June 2024, revenues jumped 144% to £28.5m, while the loss declined from £25.2m to £10.8m.

The cash outflow was reduced from £21.1m to £13.9m. There was £126.1m in cash and investments at the end of June 2024.

Bosch and Doosan are building up their manufacturing capacity. The manufacturing licence agreement with Denso Corporation in Japan and systems licence partnership with Thermax came after the end of the period.

Stuart Paynter is taking over from Eric Lakin as finance director. He will implement the cost savings.

Ceres Power has guidance for full year revenues of £50m-£60m. This is underpinned by contracts that have been won by the former AIM-quoted company. Even after the reductions in overheads, Ceres Power is likely to remain loss-making for the next couple of years at least.

AIM movers: Hummingbird Resources strategic review and Emmerson awaits permit

Andrew Hore
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AIM movers: Hummingbird Resources strategic review and Emmerson awaits permit

Emmerson (LON: EML) is hopeful that it will receive the environmental permit for the Khemisset potash project in Morocco before the end of the year. There will also be the release of lab results from the second round of crop trials that examine the effectiveness of the potash providing phosphate to lettuces. Emmerson currently has $1.7m in cash. This should last well into 2025. The share price recovered 16% to 1.45p.

Deltic Energy (LON: DELT) is rising ahead of completion of the second farm-out of the Selene prospect, where Deltic Energy will retain a 25% interest. There was £3.7m in the bank at the end of June 2024. The share price had been hit by the withdrawal from the Pensacola discovery and the uncertainty concerning the North Sea oil and gas tax regime. Richard Sneller reduced his stake from 9.9% to below 3%. The share price improved 15.7% to 5.35p.

Invinity Energy Systems (LON: IES) joint venture development partner Gamesa Electric has ordered a 1.2MWh Mistral battery for a solar and wind generating site in Spain. This was announced at the same time as the interims, which were already well flagged. Interim revenues were £1.6m and the cash outflow from activities was £12.4m. The share price rebounded 10.3% to 9.65p.

Mobile payments services provider Mobility One (LON: MBO) reported a 9% fall in interim revenues to £110.5m and it fell into loss. There was £4.41m in the bank at the end of June 2024. Management is cautious about the second half because of inflation and higher admin expenses. The completion of the proposed joint venture with Super Apps should enhance the company’s financial position. The share price improved 10.9% to 3.05p.

FALLERS

Hummingbird Resources (LON: HUM) has launched an operational and strategic review and Dan Betts is moving from chief executive to chairman of the gold producer. A new boss is being sought. Lower than expected mining volumes mean that Kouroussa will take until the end of the year to reach commercial production. A $30m prepayment gold loan has been agreed with CIG. Gold will be delivered to CIG each month. The share price slipped 21.8% to 6.65p.

Cancer treatments developer ValiRx (LON: VAL) reported an £890,000 cash outflow from operations in the first half of 2024. There was cash of £792,000 at the end of June 2024. The share price dipped 14.7% to 1.45p.

Gold explorer Panthera Resources (LON: PAT) continues to seek a resolution over permitting of the Bhukia gold project in India. It is claiming damages against the Government of India. There was a £1.9m cash outflow from operations in the year to March 2024. There was £281,000 in cash at the end of March 2024. The share price fell 11.5% to 5.75p.

Alien Metals (LON: UFO) is progressing the Hancock and Pinderi Hills projects and it is seeking “to optimise a funding strategy to extract maximum value for its shareholders”. There was a cash outflow from operations and explorations of £1.14m in the first half of 2024. The share price declined 12.8% to 0.1025p.

MicroSalt builds momentum as customers ramp up orders

UK Investor Magazine
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MicroSalt builds momentum as customers ramp up orders


MicroSalt, the low-sodium technology company founded by Tekcapital, has released an encouraging maiden interim report highlighting increasing traction with the world’s largest food companies.

The financial results for the first half are not a fair reflection of the company’s progress given much has been allocated to R&D and testing that was still ongoing during the period.

From an investor’s perspective, the most important take aways for MicroSalt’s maiden interim report is that the world’s largest food companies have upped their orders from the company after the half year period ended.

In many respects, the half year period should be overlooked and focus placed on the circa 100mt of orders committed in post the interim period. This is a significant increase in interest from customers.

MicroSalt is yet to announce the customer’s it’s working with. However, when it does, one would expected this company to attract a lot of investor interest.

Rick Guiney, CEO of MicroSalt, was upbeat on the company’s progress:

“The first half continued Microsalt’s 2023 momentum, with its successful IPO, operational and R&D progress, and coupled with preparation for upcoming commercial B2B customer product launches. In addition to progress made in North America, our geographic outreach is expanding with inroads into Asia, Australia, South Africa, the UK, Germany, Canada and Latin America with a resultant boost to our sales pipeline. We look to the future with confidence in both our product range and health proposition.”

CT Automotive Group – Oversold Shares Now Very Capable Of Big Uplift, Broker Is Looking For Them To Double 

Mark Watson-Mitchell
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CT Automotive Group – Oversold Shares Now Very Capable Of Big Uplift, Broker Is Looking For Them To Double 

Yesterday’s Interim Results announcement from CT Automotive Group (LON:CTA) for the six months to end-June saw sales revenues down from $68.2m to $60.5m, however its adjusted pre-tax profits were up convincingly at $4.1m ($2.5m), showing an almost doubled margin of 6.7% (3.7%). 

The company’s earnings more than doubled to 4.7c (1.7c) per share, while the group reduced its net debt by over a third to just $5.8m ($9.0m). 

The balance of the year is now expected to show further advances. 

CEO Simon Phillips stated that: 

“Our focus on delivering margin improvement continues to come through with profit before tax on track to be in line with market expectations for the full year and the profit before tax margin slightly ahead. 

For the first-half, gross profit margin improved by 250bps to 28.7%, compared to H1 23, reflecting successful cost reduction initiatives.  

As a result, the Company has delivered an Adj. PBT of $4.1million, a substantial improvement of 59% on the prior year.  

Existing customer volumes have aligned back to current demand as expected.  

However, five key contract wins from existing customers in H1 24, worth an estimated $27.5m annually have boosted our order book through to 2027, which with further prospects leave the business well placed to grow revenue by taking market share.” 

The Business 

Based in Portsmouth, but operating globally, the £46m capitalised CT Automotive Group designs, develops and manufactures automotive parts for the most well-known automotive brands on the planet. 

The company provides interior finishes, such as dashboard panels and fascia finishes, and kinematic assemblies, such as air registers, arm rests, deployable cup holders and storage systems, as well as their associated tooling, for automotive original equipment suppliers (OEMs) and global Tier One manufacturers.  

Its tailoring and trim department caters for and provides wrapped trim panels, shifter assemblies and lid consoles. 

It specialises in 2k tooling manufacture and production supply of cabin comfort system components, including a broad range of heating, ventilation, and air conditioning (HVAC) doors and assemblies.  

These critical components are managed through an intricate global network of reactive supply chains to arrive JIT (Just in Time) at their respective OEM manufacturing plants. 

Over the last couple of decades, it has expanded substantially and is now one of the leading names in the industry, while it plans to keep growing through the implementation of innovative ideas.  

The group, which already has sites in the UK, the US, China, Japan, Hong Kong, Turkey, Germany, France, Spain, India, Czech Republic, Mexico and Brazil. 

The core manufacturing and design operations are based in Shenzhen and Ganzhou in China, through a Wholly Foreign-Owned Enterprise (‘WFOE’) where it is able to benefit from lower cost production processes, labour and plant hardware and has over 50 senior western trained specialist engineers.  

It is continuing to look for new business locations to ensure that its global production and supply remains cost-effective and appropriate to demand. 

Its list of OEM clients includes Audi, Bentley, Mazda, Renault, Jeep, Magna, Mitsubishi Motors, Lamborghini, Mercedes Benz, Kasai, Lucid, Infiniti, Honda, Faurecia, Ford, Chevrolet, Seat, Skoda, VW, Volvo, Peugeot, and Nissan.  

The group currently supplies component part types to over 57 different models for 22 OEMs.  

Since its formation, it has been one of the very few new entrants to the market, which is characterised by high barriers to entry. 

The Equity 

There are some 73.6m shares in issue. 

The larger holders include Simon Phillips (26.77%), Otus Capital Management (17.86%), Premier Fund Managers (9.19%), Raymond James Financial (7.89%), Stonehage Fleming Investment Management (7.89%), Pitharn Ongkosit (3.67%), Lombard Odier Asset Management (3.23%), and Scott McKenzie (3.05%). 

Analyst View 

Caroline de La Soujeole at Singer Capital Markets rates the group’s shares as a Buy, with a 120p Price Objective. 

Her estimates for the current year to end-December are for $119.1m ($143.0m) revenues, with adjusted pre-tax profits of $9.3m ($8.3m) and earnings of 10.1c (13.7c) per share. 

For the 2025 year she goes for $136.8m sales, $12.3m profits and 13.4c in earnings. 

She notes that the group’s shares have been weak in recent months (-18% 3 months view) reflecting investor nervousness about end-markets, however yesterday’s results show those concerns have been overdone. 

In My View 

On the basis of the broker’s analysis, it does look as though this group’s shares, which were 85p in January this year and are now just 56.5p, have been oversold. 

What is more, with order books increasing, they are very capable of reacting positively to further good news. 

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