MicroSalt has experienced a nearly fivefold increase in demand for its low-sodium salt from B2B customers, according to a business update released on Monday.

MicroSalt previously said it had received orders for 29 metric tonnes of its patented salt from one of the world’s largest food companies. However, the company’s business update released on Monday suggests that additional orders have followed those initial orders in much larger quantities.

Demand surged in Q3 of 2024, with commitments for orders of 350,000 lbs of MicroSalt’s salt, the equivalent of around 160 metric tonnes. It’s unclear whether this demand is from one customer or several customers, but MicroSalt is confident the momentum will continue into Q4.

The quantities outlined by MicroSalt would only be required by food manufacturers concerned with the production of millions of units of any given product line. 

MicroSalt has been unable to name the companies it deals with due to the commercial sensitivities of integrating their salt into client products. We do, however, know that it is one of the world’s latest snack food companies, which narrows it down to a handful of household names. 

MicroSalt said they will provide further updates in due course. These could well be the names of the food manufacturing giants they are working with, something investors are surely looking forward to learning about. It could also be further updates on orders.

In addition to the positive update on the B2B business, we learned of further expansion of the consumer business across the United States through a series of new placements in major retailers. 

New placements include 350 Winn Dixie stores and 70 Fesh Thyme stores. MicroSalt’s low-sodium shakers can now be found in over 1,000 stores across the US.

“We are very excited about the placement of our MicroSalt products and the consequential growth in distribution within UNFI, Kehe and Ingredients Online,” said Rick Guiney, CEO of MicroSalt.

“All of these retailers have strong presence in their respective markets, and this continues our efforts to have MicroSalt in every kitchen pantry across the US and beyond.”

Property finance provider Vector Capital (LON: VCAP) shares have recovered 7.14% to 15p even though trading will be cancelled on Monday. The company spent £3.5m on a tender offer at 33p/share.

A strong performance from Shire Foods meant that revenues improved from £19.1m to £22.2m at Volvere (LON: VLE). Pre-tax profit jumped from £440,000 to £1.78m. Net assets excluding non-controlling interests are 1585p. Cash is £24.3m. Further investments are being sought. The share price rose 6.38% to 1500p.

Berenberg cut its target price for Pan African Resources (LON: PAF) from 38p to 33p, but the share price improved 4.05% to 32.1p.

Iodine producer Iofina (LON: IOF) has commissioned its latest IOsorb plant in Oklahoma. The IO#10 plant is being tested and is the production will ramp up over the next few weeks. This is the seventh plant that is in production. There should be a material contribution to production this year.

FALLERS

Proteome Sciences (LON: PRM) reports a decline in interim revenues from £3.21m to £2.22m due to reduced and delayed R&D by biotech companies and almost quadrupled it loss to £2.15m. Chief executive Dr Mariola Soehngen will step down in January. The share price slumped 26.9% to 2.55p.

Premier African Minerals (LON: PREM) says that progress is being made towards the restarting of operations at the flotation plant at the Zulu lithium and tantalum project. The company will need further funding. The share price fell 9.73% to 0.051p.

Energy optimisation services provider Inspired (LON: INSE) shares continue to fall following interim results showing revenues edged up from £44.6m to £45m and pre-tax profit dipped from £6.2m to £5.7m. That was lower than forecast. The share price declined 8.4% to 54.5p.

Transense Technologies (LON: TRT) shares dipped 2.86% to 170p ahead of full year results on 23 September. They are expected to show an underlying pre-tax profit of £1.3m. The share price has risen 64% this year.

Technology Minerals has unveiled a comprehensive cost reduction programme aimed at streamlining operations and bolstering efficiency across the organisation today.

After generating zero revenue in the six month period to 31st December, the firm is taking steps to cut costs to ‘drive productivity’. One would assume the company is yet to generate enough revenue to support its wage bill. We will find out more in the full-year report.

Steps outlined by Technology Minerals include a significant redundancy scheme to reduce the total workforce, substantial cuts to head office costs, and an ongoing, thorough assessment of all service providers.

Philip Beard has agreed to step down from his roles as Independent Non-Executive Director and Chairman of the Remuneration Committee with immediate effect.

The reduction in Independent Non-Executive Directors has prompted a review of the Board’s future composition, which is likely to be a lot leaner in the future.

“These cost reduction measures have been identified as part of the Board’s efforts to increase efficiencies and drive productivity throughout every level of the business,” said Robin Brundle, Chairman of Technology Minerals.

“On behalf of the Board, I’d like to extend our thanks and appreciation to Phil for his contribution to the Company. We are grateful for all the strategic guidance Phil has provided to Technology Minerals and wish him the best in his future endeavours.”

Those investors seeking a profitable circular economy metals recycling company should look at UK-listed Majestic Corporation.

The company generated $29m revenue in the year ended 31st December, and profit before tax grew 149%. Majestic recycles a range of e-waste and renewable energy waste and is expanding in the UK after acquiring a business based in North Wales.

Primark-owner AB Foods took a pasting after the group said Primark sales would fall in the second half of the year due to poor weather and low footfall.

After losing roughly 18% of their value since August highs, AB Foods shares are currently firmly in oversold territory with an RSI of 21. The sharp decline should pique the interest of investors seeking an entry point with the long-term investment case intact.

The Weather

AB Foods has blamed slow sales in the second half on the weather. We all know how disappointing the British summer was this year, and companies heavily reliant on good weather to drive consumer purchases have been hit hard. AB Foods isn’t the only company to attribute bad sales to poor weather.

Primark is particularly reliant on in-store sales. Although it has been strengthening its online presence, Primark is still driving people into its stores by focusing on click-and-collect and the online shopping experience provides little help during a washout summer.

However, AB Foods used the same excuse earlier this year for slow sales growth in the first half. The winter was too warm and the summer too cold, according to AB Foods.

Investors have evidently grown tired of the same excuse and dumped the stock. For those with longer time horizons, this may provide an opportunity.

Primark’s same-store sales growth is fairly steady, and the company relies on new store openings for growth—this has proved a fruitful pursuit. The company is expanding across southern Europe, and new store openings are expected to increase US sales by 25% in the second quarter.

‘Build it, and they will come’ seems to be working for Primark. The brand’s low-cost clothing is a hit wherever it opens a new store.

The company plans further expansion in the US, which promises further growth in the years to come. Primark are also eyeing the Gulf Cooperation Council markets after signing an agreement with a local partner.

Investors should note that despite uneven sales growth, Primark’s margins are strong, and they expect operating margins to be higher in H2 2024 than H2 2023.

Food

AB Foods (as the name suggests) isn’t just the owner of Primark, and food sales account for roughly half group sales.

Sales from the food side of the business are expected to be steady in the second half and pose no major concern for investors, despite agriculture and sugar’s risk of adverse weather conditions. AB Foods uses the word ‘weather’ 15 times in its interim report to give you an idea of how much its business is dependent on Mother Nature.

All three food-related divisions saw operating profits grow in the first half of the year. However, due to sugar pricing in Europe, the company expects a disappointing second half for the unit, which may have contributed to the recent selloff.

Valuation

From a valuation perspective, AB Foods offer good value at 2,170p. They trade at 11x forward earnings and 15x historical earnings. The historical earnings multiple is reasonable, and the forward multiple, should estimates be meet, suggests very good value.

Don’t expect fireworks from AB Foods, but Primark’s overseas expansion plans and stable long-term earnings from the food business should support a move back to all-time highs above 3,000p.