Director deals: Is Made Tech worth buying yet?

Andrew Hore
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Director deals: Is Made Tech worth buying yet?

At a time when many of the new AIM admissions over the past three years have performed poorly, one of the worst is Made Tech Group (LON: MTEC), which joined AIM in September 2021 when it raised £15m at 112p a share. The share price has slumped to 10.75p.
Chief operating officer Chris Blackburn acquired 310,000 shares at 10.4p each. That takes his stake to 14.5%. Back in July, chief executive Rory MacDonald acquired 897,507 shares at 17.14p each.
Chris Blackburn and Rory MacDonald are deemed to be a concert party and are not allowed to take their combined stake above 43.04%. The level is curren...

AIM weekly movers: Mars bids for Hotel Chocolat

Andrew Hore
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AIM weekly movers: Mars bids for Hotel Chocolat

Hotel Chocolat (LON: HOTC) is recommending a 375p/share bid from Mars, which values the chocolate company at £534m. The share price soared 170% to 366p and it has not been this high for 18 months. Mars is keen to help Hotel Chocolat expand into new regions. The track record of the current management when it comes to international expansion has been mixed and it will help to have a larger company with greater resources backing the expansion. Shareholders can accept an alternative offer of one rollover share in the bid vehicle for each share. The value of these shares will be dependent on the performance of the business, and this would be taking a risk.

Verici Dx (LON: VRCI) has entered into an exclusive licence agreement with Thermo Fisher for its pre-transplant prognostics. This will generate staged payments of $5m over the next 12 months, plus future royalties of per test. That means that Verici Dx will have enough cash until the end of 2024. Thermo Fisher has the commercial expertise to roll out the technology and it will further develop the product. The share price increased 56.5% to 9p.

AMTE Power (LON: AMTE) has secured a short-term financing and the share price has recovered 54.1% to 1.04p. The battery technology developer will receive £2.5m from a subscription by Pinnacle International Venture Capital at 1.7p/share and it is also providing a £200,000 convertible loan facility. A placing will raise a further £400,000 at 0.5p/share. A general meeting is required to approve the subscription.

City Pub Group (LON: CPC) is also the subject of an agreed bid. Young & Co’s Brewery (LON: YNGA) is offering 108.75p in cash and 0.032658 of an A share for each City Pub Group share, valuing it at 145p/share or £162m. The share price jumped 52.5% to 136.5p. Young’s has been seeking to grow its managed pubs business and believes it is rare to have the opportunity to acquire such an attractive portfolio of pubs. The deal will increase the number of pubs owned by 50 to 279. A significant amount of City Pub Group’s central overheads of £5.6m could be saved by the combined group and there could be other savings. Young’s shares rose 1.86% to 1095p.

FALLERS

Nickel project developer Horizonte Minerals (LON: HZM) is reducing construction activities at the Araguaia nickel project while it continues financing discussions. The project has enough working capital until mid-December, although this could be extended into the first quarter of next year. This is when the due diligence of the finance providers should be completed. The share price slumped 54.1% to 8.6p, which is just above the low on the week.

Antimicrobial technology developer Byotrol (LON: BYOT) expects modest full year growth in full year revenues, which means that the loss will be slightly higher than previously anticipated. Half year sales were £2m. IP deals are still difficult to forecast. There should be £300,000 in cash at the end of March 2024, down from £500,000 at the end of September. The share price fell 38.9% to 0.55p to a new low.

Trading recommenced in Rockfire Resources (LON: ROCK) shares on Monday afternoon after it revealed it was not going ahead with the acquisition of Emirates Gold because of UK sanctions on the current owner Paloma Precious. Rockfire Resources still has a 10% stake in Emirates Gold. Later in the week it said Sunshine Metals has commenced drilling at the Lighthouse tenement in Queensland. This is part of the option for Sunshine Metals to earn up to 75% of the tenement by spending $2.2m over three years. This has helped the share price to recover but it was still 38.4% lower at 0.225p.

Jarvis Securities (LON: JIM) has confirmed it is not paying a fourth quarter dividend. The FCA is planning a further review into the company’s operations, including the approach to uninvested cash and interest retention. This report has to be delivered by the end of February 2024.The voluntary restrictions on the business are continuing and another review is required before they can be lifted. The reviews have cost more than £1.3m this year. The share price declined 37.4% to 48.5p. That is the lowest it has been for eleven years.

Knight Frank Survey: 60% of housebuilders are providing non-cash incentives

Eve Katz
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Knight Frank Survey: 60% of housebuilders are providing non-cash incentives

Global property consultancy Knight Frank released its Q3 2023 Land Index and Housebuilder Survey, which highlights that in response to tough housing market conditions in the UK, almost 60% of surveyed housebuilders are providing non-cash incentives.

According to the report, among respondents, 59% are offering items like carpets or white goods, over 40% contribute to legal fees or stamp duty, and nearly a quarter provide deposit contributions. Additionally, 16% are giving cashbacks or mortgage subsidies.

The major challenges faced by the sector in Q3 include planning delays (80% of respondents), concerns about land availability, mortgage availability, and cost (all at 47%). About 36% of respondents express worries about buyer sentiment and the UK economic outlook.

According to Charlie Hart, Partner at Knight Frank, “It’s interesting to see a significant increase in the number of housebuilders offering various incentives to attract buyers. This only emphasises the need for the industry to adapt and remain agile as the market evolves.

“It’s clear to see that they are doing all they can to generate sales, and throughout these challenging times, it’s now more important than ever to have a government that understands the genuine challenges facing the market. The industry is looking for positive policy direction in the autumn statement.”

In total, 48% of housebuilders anticipate a decline in average land values in the last quarter of the year compared to Q3. Another 48% believe they will remain unchanged, according to the latest survey of 54 volume and SME housebuilders by Knight Frank. Only 5% predict an increase.

Anna Ward, Associate in the Residential Research team at Knight Frank, said that,”cost and buyer sentiment have risen up the agenda over the past year as key concerns in our survey. Several other headwinds are also limiting development, from planning delays to high build costs. Looking ahead, the direction of the UK economy is likely to have the biggest impact on the housebuilding sector over the next few months.”

The pound falls against the dollar as retail sales decline in September

Eve Katz
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The pound falls against the dollar as retail sales decline in September

The pound falls against the dollar as retail sales fall in September

Office for National Statistics (ONS) retail data showed on Thursday that in September 2023, retail sales volumes declined by 0.9% as the pound fell against the dollar.

Looking at the quarter, sales volumes dropped by 0.8% in the last three months.

In their September 2023 retail data report, ONS indicates that it looks like consumers are struggling against the cost of living crisis.

The ONS retail report further states that non-food store sales volumes decreased by 1.9% in September 2023, with retailers attributing the decline to ongoing cost of living pressures and unseasonably warm weather affecting autumn clothing sales.

According to Danni Hewson, head of financial analysis, “retail sales have fallen to the lowest level since February 2021, when the country was in the middle of the third national lockdown. Many stores had to keep their doors closed, and those that could open had strict social distancing measures in place. (square brackets) Fast forward a couple of years, and these numbers are particularly concerning for retailers because this isn’t February 2021; these numbers were for the month of October, when consumers traditionally begin their Christmas shopping.”

Further reports that in September 2023, total non-food store sales volumes, including department stores, clothing stores, household stores, and other non-food stores, decreased by 1.9%, contrasting with a 0.3% increase in August 2023.

Food stores experienced a 0.2% increase in sales volumes in September 2023, following a 1.4% rise in August 2023.

These include independent bakeries, Italian shops, butcheries, luxury brand stores, and luxury alcohol brands.

Within the non-food category, household goods stores reported a 2.3% decline in sales volumes, primarily attributed to decreases in furniture and lighting stores.

Non-store retailing, primarily online retailers, saw a 2.2% decrease in sales volumes in September 2023. They had previously dropped 0.9% in August.

Value and brand deals supermarkets “maintained a bit of growth, but specialty stores like butchers and artisan bakers saw trade drop off.”, Hewson said.

Danni Hewson adds, “The question at hand is: are we saving up our cash, squirrelling it away in order to make the most of those big promotional days like Black Friday, or have price pressures pushed people to rethink Christmas plans entirely?”.

Automotive fuel sales volumes rebounded by 0.8% in September 2023, showing a recovery from a 1.0% decline in August 2023.

AIM movers: Strong cash generation for Parkmead, shortage of cash for Real Good Food

Andrew Hore
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AIM movers: Strong cash generation for Parkmead, shortage of cash for Real Good Food

Strong cash generation at Parkmead Group (LON: PMG) boosted the share price. The Dutch gas assets generated £6.5m in cash in the 12 months to June 2023. Production should increase this year. The Kempstone Hill wind farm is starting to generate revenues. There are £188m of tax losses. The share price jumped 26.3% to 18p, although it has still fallen by two-thirds this year.

AMTE Power (LON: AMTE) has secured a short-term financing and the share price has recovered 12.2% to 1.15p. The battery technology developer will receive £2.5m from a subscription by Pinnacle International Venture Capital at 1.7p/share and it is also providing a £200,000 convertible loan facility. A placing will raise a further £400,000 at 0.5p/share. A general meeting is required to approve the subscription.

Jersey Oil and Gas (LON: JOG) and NEO Energy are buying the Western Isles floating production, storage and offloading (FSPO) vessel for the planned redevelopment of the Buchan field. NEO Energy will buy the vessel and Jersey Oil and Gas, which holds a 50% working interest in the field, will receive $9.4m from NEO Energy as part of the farm-in deal. Zeus estimates core NAV of 408p/share. The share price improved 13.1% to 216p.

AFC Energy (LON: AFC) is purchasing Octopus Hydrogen’s UK mobile hydrogen storage and distribution assets. These assets can be used to provide a hydrogen fuelling service for H-Power generator units rented by new partner Speedy Hydrogen Solutions and other future users of hydrogen powered equipment. The share price rose 7.8% to 15.76p.

FALLERS

Real Good Food (LON: RGD) is the highest faller on the day for a 12.1% decline to 1.45p following the disposal of Rainbow Dust Colours for £800,000 and a warning of tough trading, partly due to a shortage of cash. The remaining business is cake decorations maker JF Renshaw and its future is uncertain.

Tekcapital (LON: TEK) investee company Innovative Eyewear has launched a new Lucyd Dock product charging accessory. The Tekcapital share price dipped 6.18% to 8.5p.

SkinBioTherapeutics (LON: SBTX) has raised £3m from a placing at 19p/share, while a retail offer of up to £250,000 is ongoing and closes on 20 November. The cash will finance further studies, including one for the potential acne treatment, and the roll out of psoriasis treatment Axis-PS. The share price slipped 4.65% to 20.5p.

Future Metals (LON: FME) has exercised its option to acquire Osprey Minerals, which has an exploration tenure next to the company’s Panton platinum group metals project in Western Australia. The initial payment is 18.4 million shares, with a further A$625,000 of deferred consideration depending on the level of exploration drilling. The share price fell 2.38% to 2.05p.

Oil prices bounce but head for fourth week of declines

Eve Katz
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Oil prices bounce but head for fourth week of declines

Oil price staged a minor rally on Friday as traders covered shorts after another week of declines.

At the time of writing on Friday, Brent crude is up 1.24%, while WTI crude is up 1.21%.

Brent crude has stabilised above $77 but is heading for its fourth consecutive weekly drop.

WTI crude was trading at $73.80 per barrel, while Brent crude is $78.39.

According to Sophie Lund-Yates from Hargreaves Lansdown, even though “this (what this) outweighed concerns around OPEC+’s decision to go ahead with voluntary supply cuts,”

Additionally, “prices are still elevated compared to pre-pandemic, but this window does potentially offer some respite to businesses and consumers if it can be sustained—and in the short term, that will depend on escalating tensions in the Middle East”, said Lund-Yates.

FTSE 100 set for a strong finish to an encouraging week for UK stocks

UK Investor Magazine
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FTSE 100 set for a strong finish to an encouraging week for UK stocks

The FTSE 100 was on the front foot on Friday as investors appeared encouraged by a two-week period of central bank action and inflation data.

The key takeaway for investors is the Federal Reserve and Bank of England are likely done with rate hikes and inflationary pressures on global economies are easing.

“One sure way to fire markets up would be a definitive course of action on interest rates. In the absence of certainty though, markets only have maybes to go on. And the latest suggestion from Goldman Sachs suggests that interest rate cuts could be coming in the new year and will brighten up February,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.

“There has been some concern over when the Bank of England will start snipping the tightropes of monetary policy, given that there is still some residual heat in the economy. Policymakers are insisting that loosening isn’t on the cards just yet, but things have been moving in the right direction which opens up the possibility of a policy shift in the coming months.”

Optimism around rates and inflation trumped a poor session in Asia and concerns about retail sales as the FTSE 100 gained 0.8% in early trade.

“The FTSE 100 shrugged off a weak showing for Asian shares overnight and softer than expected UK retail sales to trade firmly higher on Friday, shaking off the ennui it had shown on Thursday in the wake of Wednesday’s exuberance,” said AJ Bell investment director Russ Mould.

“The index was hurt by its big exposure to oil and gas yesterday as a big build in US inventories caused crude prices to plunge. The upside of this scenario is it further reduces inflationary pressures and underscores the idea that the rate hiking cycle has peaked.

“What’s helped in this regard is that Federal Reserve officials, while not exactly getting out the garlands and bunting and announcing a victory parade in the battle against inflation, are not really pushing back against the peak rates narrative either.”

Should others join Goldman Sachs in predicting rate cuts early next year, global equities could really fire up.

All industry groups were higher in London at the time of writing, with cyclical sectors leading the way.

Of the FTSE 100 constituents, only 5 were trading negatively at the time of writing.

The Biggest Noise in Beer is Crowdfunding

UK Investor Magazine
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The Biggest Noise in Beer is Crowdfunding

Sponsored by Signature Brew

Signature Brew, winner of Brewery of the Year in 2018 & 2021, was founded by a brewer and a musician with one simple philosophy – brew beer that makes music better.

This USP has established Signature Brew as the UKs most exciting brewery with music centric venues and high st pubs alike listing their accessible award-winning beers. With national distribution at 400+ permanent stockists, the brewery is backed by a community of partner artists and venues, and has a £5.3M run rate for 2023.

Having pivoted effectively – pioneering the now legendary Pub In A Box – during COVID in order to continue growth in 2020 and 2021 Signature Brew is now raising funds to fuel their national and international expansion through a seminal period as they bid to increase revenue from £5m to £10m as quickly as possible ahead of a targeted exit in 2-3 years time.

With the support of eminent M&A expert consultants Arlington Capital Advisors Signature Brew are acutely aware that reaching £10m revenue is the milestone at which global brewers look to acquire fast growing breweries. Doing so at the fastest growth rate possible is critical to achieving the exit valuation target of ~£75m.

Signature Brews development since inception has been supported by genuine association and collaboration with some of the biggest and best musicians in the world. They’ve collaborated with more bands than any one other brewery and their strategy going forward is underpinned by their Community of artists and utilising over a decade of being the go to brewery for bands and musicians.

Signature Brew has a state-of-the-art brewery in East London – complete with an iconic live music venue – where they’re brewing fresh, award-winning beer week-in and week-out and passionately supporting grassroots music at the same time. The brewery has been designed for quality and growth. High tech equipment such as Reverse Osmosis, Centrifuge and a fully automated brewhouse ensure perfect consistency in the product and the size of the vessels has ensured there’s ample headroom in the brewery’s production capacity.

Some of Signature Brews most significant accomplishments to date include:

  • Creating more than 60 collaboration brews with international bands and musicians. Including; alt-J, Idles, The Skints, Big Joanie, Hot Chip, Darkness, Sports Team, Mastodon, Hospital Records, Mogwai, Frank Turner and Heriot.
  • Created venues that are the place to be. Recent highlights include Skrillex, Tony Hawk, Tinchy Stryder, Steve Harris (Iron Maiden), Kate Nash and Aisling Bea all turn up for a pint or jump on stage!
  • Artists don’t just support via collaborations and performances many have invested in Signature Brew and are passionate about the growth of the brewery.
  • The legendary Pub In A Box was launched in the first lockdown in 2020. Signature Brew hired out of work musicians to help deliver the packages and the altruistic pivot during COVID gained press coverage from the likes of BBC News, Sky News, LadBible, GQ, Esquire, The Guardian and Rolling Stone.
  • When lockdown was lifted in 2021 they helped independent venues all over the UK get trading again via their Beer Grants campaign that saw Signature Brew give away £250k of beer.
  • They work with some of the best music venues in the country such as Rough Trade, Strongroom, Bush Hall and The British Music Experience.
  • All core beers have won Great Taste Awards as well as many regional and national brewing industry awards.
  • They support great music charities such as Music Venues Trust and Backup Tech.
  • And finally the brewery has a proud commitment to sustainability and leaving footprints on the festival field, not on the planet via a suite of green initiatives and efficient production methods

So this is your chance to join the likes of Robbie Williams, The Prodigy, Enter Shikari and Alt-J in investing in Signature Brew, a brewery with generational growth potential and a clear exit strategy.

Tekcapital’s Innovative Eyewear announces roll out of improved charging dock

UK Investor Magazine
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Tekcapital’s Innovative Eyewear announces roll out of improved charging dock

Tekcapital has announced that Innovative Eyewear has launched a new edition of its Lucyd Dock product for the company’s smart eyewear brands including Lucyd, Nautica, Eddie Bauer and Reebok.

The Lucyd Dock is a first-of-its-kind charging accessory designed specifically for smart eyewear. It allows users to simply place their Lucyd Lyte glasses onto the Dock to charge, similar to how one would place traditional glasses on a nightstand before bed.

According to Innovative Eyewear, the new Dock 2.0 model maintains the original suggested retail price of $34.99 while adding several core improvements.

The upgraded features include cordless charging contacts that automatically adjust for all Lucyd models, an indicator light to show charging status, two USB-A ports and one USB-C port for simultaneously charging other devices, and USB data transfer capabilities to use it as a desktop USB hub.

The Lucyd Dock 2.0 is also more compact and travel-friendly than the previous model. It comes in new 99% post-consumer recycled packaging with product information printed in 5 languages to support global sales and distribution.

The redesigned Lucyd Dock aims to improve the user experience and charging functionality for Innovative Eyewear’s lineup of smart eyewear brands, providing both convenience and sustainability benefits.

“We are closer than ever to our goal of the world’s most user-friendly smartglasses with the launch of the Lucyd Dock 2.0. I am confident our customers will enjoy using the Dock to keep their various devices charged and their cables more neatly organized,” said Harrison Gross, CEO of Innovative Eyewear.

“By adding the new USB data functionality enabling the Dock to be used as a USB hub for computers, we have made it even more of a must-have accessory for our smart eyewear customers.”

FTSE 100 consolidates, ex-dividends and Burberry drag

UK Investor Magazine
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FTSE 100 consolidates, ex-dividends and Burberry drag

The FTSE 100 slipped on Thursday with heavy-hitting dividend payers trading ex-dividend and Burberry dragging on the index after lowering profit forecasts for the year.

London’s leading index was down 0.6% at the time of writing on Thursday while the German Dax added 0.6% and French CAX lost 0.25%.

Companies trading ex-dividend on Thursday included Shell, Unilever, GSK and Hargreaves Lansdown.

The hype around lower CPI readings in the UK and US has started to subside, and markets are settling back into a familiar wait-and-see mode with key central bank meetings on the horizon.

“The market may be in something of a holding pattern until the next central bank meetings land in early to mid-December – although takeover action has offered some excitement today,” said AJ Bell investment director Russ Mould.

Mould also remarked on President Biden’s trip to meet Chinese leader Xi Jinping in which he called his counterpart a ‘dicator’. The meeting was meant to repair relations but the resultant headlines have focused on Biden comments. China responded saying his comments were incorrect.

Biden’s words unnevered markets and caused minor weakness in equities.

“A mixed response to a meeting between President Joe Biden and Chinese Premier Xi Jinping saw Asian stocks retreat a little,” Mould said.

Burberry

Burberry shares sank on Thursday after the luxury group said slowing demand would hit earnings this year. Shares in the company were down 9.7% at the time of writing and were by far the FTSE 100’s worst performer.

“The shine is dimming on the luxury sector as even higher end consumers tighten their belts. Heralded as a more resilient corner of the economy, suggestions of missing targets and lower-end profits aren’t what investors have come to expect and that has consequences for valuations,” said Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown.

“Specifically for Burberry, it doesn’t have a basket of other brands or products to help diversify risk in this scenario. The work the group’s done to become a more premium luxury house is to be commended and will improve strength in the long-term, but there’s no getting away from the fact that particularly aspirational, younger shoppers are thinking twice before swiping their cards. There could be further pressure to come before things improve, especially if a broader pull back in spending comes through in 2024 after the glut of festive trading.”

The step back in enthusiasm around interest rates was felt by Ocado shares which fell 4% on Thursday.

Halma was the FTSE 100’s top performer after the health technology company released a very robust set of earnings. Revenue and earnings rose by solid single digit percentages as the group achieved record revenue in the period.

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