Tekcapital shares jump as Lucyd announce landmark partnership

UK Investor Magazine
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Tekcapital shares jump as Lucyd announce landmark partnership

Tekcapital shares rose in early Monday morning trade after their portfolio company Innovative Eyewear announced a smart eyewear partnership with fashion brand Nautica.

The landmark agreement will see Lucyd technology licensed to Nautica for the production of smart eyewear aimed at Nautica’s ocean faring customers.

Nautica’s brand carries a nautical appeal, an activity Lucyd’s technology could potentially provide enormous benefits.

Lucyd’s Bluetooth enabled smart eyewear allows users to perform activities that may otherwise be a distraction, such as answering mobile phone calls.

“The Nautica smart eyewear line will stay true to the brand essence of bringing the inspiration of the sea into smart eyewear that is modern and innovative,” said Harrison Gross, CEO of Innovative Eyewear, Inc.

“Our Nautica® smart eyewear collection, powered by Lucyd®, will align perfectly with today’s lifestyle, as we believe consumers are looking for designer eyewear that allows them to reman connected to their digital lives.”

Tekcapital shares were 4% higher at 19p at the time of writing.

Bid battle for RPS not finished

Andrew Hore
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Bid battle for RPS not finished

There could be scope for further improved bids in the takeover battle for engineering professional services firm RPS (LON: RPS). It has strong positions in niche markets in the UK and some other countries and provides an attractive way of enlarging international exposure for the bidders.  
WSP initially bid 206p a share for RPS and this was recommended by the company in August. Tetra Tech has come in with a higher bid of 222p a share and the recommendation of the WSP bid has been withdrawn. Toronto-based WSP is considering its options.
Tetra Tech is listed on Nasdaq and provides consultin...

Aquis weekly movers: Chapel Down expects strong harvest

Andrew Hore
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Aquis weekly movers: Chapel Down expects strong harvest

RentGuarantor Holdings (LON: RGG) is the best performer of the week even though there was no news except the announcement of an investor Q&A. There were four trades during the week. Three were on Tuesday and the fourth on Wednesday was a trade of 1,000 shares at 165p. The share price surged 26.9% to 165p.

Trading in the shares of Marula Mining (LON: MARU) prior to its interims pushed up the price by 6.67% to 2.4p. In the first half of 2022 there were no revenues and a loss of £169,000.

Thixotropic gels manufacturer Unigel Group (LON: UNX) joined the Access segment of the Aquis Stock Exchange in August. There was £800,000 raised at 64p a share. The gels are used in the fibre optic industry. A maiden trading statement says that interim pre-tax profit was 94% ahead at £940,000. New products and higher selling prices boosted revenues and current trading is described as robust.

Hydrogen Utopia International (LON: HUI) had £3.2m left in the bank at the end of June 2022. There were no revenues in the first half. There was progress with waste plastic to energy project developments.

Wishbone Gold (LON: WSBN) had £2.38m in the bank at the end of June 2022. Drilling has commenced in Western Australia and Queensland in recent months.

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Fallers

Clean Invest Africa (LON: CIA) was the worst performer on the Aquis Stock Exchange last week with a decline of 42.9% to 0.2p. Loan notes have been converted into shares helping the company turn net liabilities into net assets of £1.72m at the end of June 2022. The company’s CoalTech technology is proven in palletising coal fines or coal waste and management believes that other materials could be palletised.

VSA has downgraded its forecasts for battery storage technology developer Invinity Energy Systems (LON: IES) following interim figures. First half revenues were £1.4m and the order book is worth £13m – mainly relating to the second half. However, 2022 revenues were downgraded from £14.1m to £11m. Next year’s revenues have been upgraded from £20.6m to £23.7m. Cash is likely to run out later next year. The shares are 20.3% lower at 25.5p.

Coinsilium (LON: COIN) reported a net fair value gain on financial assets of £163,000 in the first half of 2022. However, the value of cryptocurrency assets has declined. Net assets have fallen from £5.84m to £4.57m. There was a 15.9% fall in the share price to 1.85p.

All Things Considered (LON: ATC) investee company Driift has acquired interactive live streaming events platform Dreamstage, which has been used by Driift for its own events. Deezer will invest a further £4m into the combined business. Music management business All Things Considered increased interim revenues by 19% to £6m and the loss was reduced. Net cash is £1.5m. A full year loss is expected compared with previous expectations of a £600,000 profit. The share price fell 14.4% to 110p.

Wine maker Chapel Down Group (LON: CDGP) increased interim revenues by 4% to £6.88m. Sparkling wine revenues were 35% higher. Pre-tax profit improved by 6% to £489,000. The company started harvesting in August and a strong yield is anticipated. The share price fell 7.55% to 24.5p.

KR1 (LON: KR1) is not immune to the decline in values of digital assets. The value of intangible assets fell by £155.5m in the period, which more than offset realised gains of £2.5m and income of £16.6m. Net assets have declined by nearly three-quarters and NAV is 30.6p a share. The share price fell 6.58% to 35.5p.

ProBiotix Health (LON: PBX) generated sales of £306,000, down £537,000 in the first half of 2022. Orders worth £1.12m have been received since the beginning of the year, so the second half revenues should be stronger, as well as higher than last year. The share price slipped 6.25% to 22.5p.

In the six months to June 2022, the value of the equity stakes held by Cadence Minerals (LON: KDNC) fell from £12m to £5.75m. The main decline was in the value of the stake in AIM-quoted European Metals Holdings. There was £1.99m in the bank at the end of the period. The shares declined 5.76% to 9.4p.

NFT Investments (LON: NFT) has been hit by a reduction in the value of cryptocurrency, particularly Bitcoin. That means that NAV has fallen to £30.1m, including £20.4m in cash. There was a revaluation reduction of £265,000, but that was offset by exchange gains of £362,000, leaving the value of investments at £6.47m. At 0.91p, down 4.21% on the week, the share price is less than one-third of the NAV of 3p a share.

Screwless spinal stabilisation systems developer TruSpine Technologies (LON: TSP) had £3,471 in cash at the end of March 2022. There was a £390,000 cash outflow from operating activities and £1m of development spending capitalised. TruSpine subsequently entered into a funding agreement with Proffitt Brothers and $100,000 has been received. The shares fell 3.33% to 4.35p.

Helium Ventures (LON: HEV) is considering widening its investment strategy because of the lack of suitable helium investments. If a suitable acquisition is identified, then shareholders would be asked for their approval. The shares slipped 2.26% to 6.5p.

Kent brewer Shepherd Neame (LON: SHEP) returned to profit in the year to June 2022. The total dividend is 18.5p a share. Net assets increased from 1140p a share to 1194p a share, while net debt is back to pre-pandemic levels at £75.3m. Pubs and hotel revenues are still lower than in 2018-19. Beer volumes have more than recovered, although own beer volumes are 8% lower than three years ago. In the 13 weeks to 24 September 2022, like-for-like retail sales are 9% ahead, while own beer volumes were 1.2% higher – including a 14% improvement in own beer volumes. There was a 1.5% decline in the share price to 670p.

Property investor Ace Liberty & Stone (LON: ALSP) increased pre-tax profit by 49% to £2.07m in the year to April 2022. Net assets are 6% higher at £34m. Net debt has reduced from £54.8m to £44.6m. A dividend of 3.4p a share has been announced that will cost £2m. The share price fell 1.45% to 68p, valuing the company at £40.7m.

AIM weekly movers: Attraqt agrees offer

Andrew Hore
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AIM weekly movers: Attraqt agrees offer

Crownpeak Holdings is making an agreed 30p a share cash bid for omnichannel retail merchandising software provider Attraqt Group (LON: ATQT).  The plan is to combine Attraqt’s merchandising technology the Digital Experience Platform owned by Crownpeak. The share price has not been as high as the bid price since May, and it reached its all-time low of 17.5p prior to the bid. The share price jumped 63.3% to 29.4p, making it the best performer of the week.

Tertiary Minerals (TYM) announced the commencement of soil sampling at the Jacks copper project in Zambia, where there is a collaborative agreement with First Quantum Minerals. This is in the area surrounding copper mineralisation intersected by drilling earlier this year. Tertiary Minerals shares rose 55.6% to 0.21p. The share price nearly doubled in September.

Sustainable biopesticides developer Eden Research (LON: EDEN) has obtained US EPA approval for its three active ingredients and two formulated products. Mevalone (a biofungicide) and Cedroz (a nematicide) sales should start next year via existing distribution partners. State approvals are required before launching in an individual state. Eden Research reduced its interim loss, but cash is still flowing out of the business. There was a cash outflow of £1.9m in the first half, including capitalised development costs and £1.85m was in the bank at the end of June 2020. R&D tax credits will help to replenish cash, but more will be required in the near future if Eden Research is going to take full advantage of the EPA approval. The share price jumped 29.3p% to 4.85p, which is still not far from the all-time low.  

Pathfinder Minerals (LON: PFP) has agreed an option with claim enforcement group Acumen Advisory Group (AAG) for the acquisition of Mozambique-based IM Minerals Ltd. AAG will complete due diligence before deciding whether to pay £2m to acquire the business and then commence proceedings against the government of Mozambique due to the unlawful transfer of a mining licence. A successful claim would spark a contingent payment to Pathfinder Minerals of either $24m or 20% of net recoveries if that is higher. The claim could be worth between $110m and $1.5bn and AAG has the cash to pursue it. The company was £146,000 in the bank at the end of June 2022 and that would not have lasted much longer. Pathfinder Minerals shares increased by 28.6% to 0.675p.

Music streaming technology provider 7Digital (LON: 7DIG) remains loss making, but the deficit reduced substantially in the first half of 2022. Revenues were one-fifth higher at £3.9m. Since the end of June, a contract has been signed with Utopia Music. Two weeks ago, 27% shareholder Magic Investments SA lent 7Digital £500,000 at an interest rate of 5% a year. This repayable by 1 October 2023. The share price rose 27% to 0.235p.

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Fallers

Xeros Technology (LON: XSG) has signed a joint development agreement with a global domestic washing machine component manufacturer for its XFilter microfibre filtration technology. A full licence dela could be agreed in six months. However, the subsequent interim announcement and fundraising sent the shares to a new closing low of 5.7p, down 71.5% on the week. A placing raised £6m at 5p a share and a six-for-seven open offer could raise up to £1m more. In March 2021, a placing and open offer at 240p a share raised £9m. There was £2.6m of cash at the end of August 2022 and the cash outflow is £500.000 a month.

Ireland-based accounts software company Glantus (LON: GLAN) warns that there will be additional operating costs in the second half plus charges for the relocation of operations to Costa Rica. Revenues will also be lower than expected. This led to the share price plummeting 68% to 12p. Glantus joined AIM in May 2021 at 102p a share. Executive director Diane Gray-Smith bought 150,000 shares at 14.8333p each.

Digital transformation services TPXimpact (LON: TPX) had a management overhaul last week because trading has been below expectations and there were complications with the integration of the businesses acquired. Chief executive Neal Gandhi and finance director Oliver Rigby. Bjorn Conway is the new chief executive. The order book is increasing in value, but revenue expectations have been cut from £97.4m to £90m. Operating costs are rising. and profit expectations have nearly halved. The share price has slumped by 64.8% to 40p, which is a new low.

Shares in Pressure Technologies (LON: PRES) slid 61.7% to 25.5p after disappointing second half trading. This means that there will be a full year loss. The engineering company will also breach covenants on its bank facility and more cash is required. Supply chain and manufacturing problems hampered progress with defence contracts. Oil and gas companies delayed orders. On top of this costs have been rising. Management believes that Pressure Technologies can return to profit in 2022-23 on the back of improving order levels.

MusicMagpie (LON: MMAG) has been hit be weak consumer spending with lower sales of technology. That hit the share price and it fell 54.5% to 12.5p. The April 2021 placing price was 193p. Rental income from pre-owned mobiles is growing, though, and that is good for longer-term revenues. The original pre-owned books and music operations are trading as expected. The second half should still be better than the first half, although a full year pre-tax loss is forecast on flat revenues. A small profit is forecast for 2023. Net debt is expected to be £8m at the end of the year.

AIM movers: Joules share price recovers, while TPXimpact’s halves

Andrew Hore
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AIM movers: Joules share price recovers, while TPXimpact’s halves

Shares in retailer Joules (LON: JOUL) have reacted positively to a statement last night. Management says that the turnaround plan is progressing. Joules is still considering how to raise additional finance. The share price recovered by 25.8% to 6.29p.

Angus Energy (LON: ANGS) says Saltfleetby gas flow rates will be ramped up to 6 million cubic feet per day in October. A further compressor will double flow rate in January 2023. The shares are 14.1% higher at 2.225p.

Pharma company e-Therapeutics (LON: ETX) is raising £13.5m at 20p a share – M&G funds are investing in the shares. The share price rose 9.54% to 19.525p. This adds to the cash of £21.8m at the end of July 2022. This cash will be used to expand the in-house pipeline of RNAi candidates that the ETX platform has identified. It will also fund further development of cell-type specific computational tools and datasets.

Nostra Terra Oil and Gas Company (LON: NTOG) more than doubled its interim revenues to $2m on a one-third rise in oil production. Cash generated from operations was $850,000. The latest well has already reached payback. There are further production increases in the second half as wells that have been offline for work on facilities return to production. The share price rose 10.4% to 0.265p.

Digital transformation services TPXimpact (LON: TPX) says trading has been below expectations and complications with the integration of the businesses acquired to build up the group has not run smoothly. Operating costs are rising. The order book is increasing in value, but revenue expectations have been cut from £97.4m to £90m. Profit expectations have nearly halved. Chief executive Neal Gandhi and finance director Oliver Rigby. Bjorn Conway is the new chief executive. The share price has slumped by 54.8% to 47.5p.

Sports nutrition supplier Science in Sport (LON: SIS) has commenced a strategic because of review and an option is a sale of the company. This has been coupled with a £5m placing at 15p a share. The share price dived 27.7% to 17p. This cash will strengthen the balance sheet and provide finance to cope with raw material price increases. Reduced consumer confidence is having an impact on trading.

Credit provider Morses Club (LON: MCL) has been hit by claims against the home collected credit division. Losses continue and this is reducing cash available to lend. A scheme of arrangement is being developed to avoid insolvency. The share price has slumped 23.5% to 3.78p.

Real Good Food (LON: RGD) says it needs to make further cost reductions and more redundancies will be required. Expectations for the current year have been reduced and £2.5m is being sought to finance the restructuring. The shares are 19.2% lower at 1.05p.  

Sterling returns to pre-budget level, 900 pips off weeks lows

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Sterling returns to pre-budget level, 900 pips off weeks lows

The pound continued its recovery on Friday with GBP/USD returning to pre-pandemic levels as markets looked forward to dramatic rate hikes from the Bank of England.

There has been a general improvement in UK assets on Friday with the FTSE 100 gaining and bond yields falling.

However, analysts warned the respite from this week’s volatility may only be short lived.

“The pound may have returned to the levels it was at when Chancellor Kwasi Kwarteng stood to address MPs a week ago but that doesn’t mean we’ve miraculously returned to a pre-mini-Budget world,” said AJ Bell investment director, Russ Mould.

“The currency’s recovery is predicated on more rapid and aggressive rate hiking from the Bank of England with all the implications that has for borrowers and, in particular, anyone with a mortgage.”

Despite the backdrop of worsening economic conditions, traders were positioning for a possible U-turn by the government on some of their measures which would be a welcome boost sentiment.

There is growing pressure on the PM from her backbenchers to remove the Chancellor and pedal back on his mini-budget package.

GBP/USD was 1% higher at 1.2223 at the time of writing, around 900 pips above the lows of the week.

UK housebuilders lead FTSE 100 rally

UK Investor Magazine
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UK housebuilders lead FTSE 100 rally

The FTSE 100 staged a rally on Friday morning with the house builders leading the way after suffering sharp declines earlier in the week.

Barrett Developments was the top riser gaining some 5% and Persimmon was 4% stronger while the FTSE 100 was 0.95% higher at the time of writing.

Banks were also gaining as the same sentiments driving housebuilders higher also saw support for Lloyds, Natwest and Barclays. Lloyds shares were 3.4% higher while Natwest gained 2.9%.

In a sign of improving sentiment – albeit from a very low base – defensive names such as Unilever, Reckitt Benckiser, and BAE Systems were all negative on the day.

In what has been an extremely volatile week, there was a general recovery in UK assets on Friday with GBP/USD gaining 0.3% to 1.1148 and UK 10-year yield dropping to 4.07%. A better than expected read on UK Q2 GDP will also help improve the mood after the original 0.1% contraction was revised to 0.2% growth.

This will ease any concerns of an imminent technical recession but the coming quarters could well see the UK slip in contraction and recession.

“The Office of National Statistics has released its revised view of recent GDP data this morning. Growth in Q2 of this year has been revised up from -0.1% to growth of 0.2%. Hardly a blistering pace, but enough to mean that the UK has not already entered recession, contrary to some forecasters,” said Steve Clayton, Fund Manager at HL Select.

Any further pick up in UK assets will hinge on the market’s perceptions of the government’s ability to provide some balance to their radical spending plans and tax cuts. The Tory will hold their conference this weekend and markets will be watching closely for any signals about their intentions to push forward with their proposals.

As we noted yesterday, we will receive updates from consumer facing companies such as Tesco and Greggs next week and investors will be keen to gauge the health of the UK consumer following a raft of retail profit warnings this week.

UK house price growth eases for the first time in 2022 but remains resilient

UK Investor Magazine
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UK house price growth eases for the first time in 2022 but remains resilient

After consistently seeing a fast pace of growth through 2022, UK house price growth slowed for the first time in September.

The Nationwide House Price Index showed house prices grew 9.5% in the year to September, down from 10% in August.

Although the pace house price growth slowed, house prices were still flat month on month highlighting there was yet to be any major disruption to the housing market.

The Nationwide Chief economist highlighted a lack of supply as supporting house prices even though new buyer enquiries dipped.

“There have been further signs of a slowdown in the market over the past month, with the number of mortgages approved for house purchase remaining below pre-pandemic levels and surveyors reporting a decline in new buyer enquiries.  Nevertheless, the slowdown to date has been modest and, combined with a shortage of stock on the market, this has meant that price growth has remained firm,” said Robert Gardner, Nationwide’s Chief Economist.

The recent volatility in fixed income markets and indications of higher mortgage rates will lump further pressure on house prices and some experts are predicting house prices could fall by 10%-20% in the next year.

The removal of mortgage products by banks and building societies will also send waves through the housing market as buyer find themselves limited in options to secure new loans.

“There were already gathering clouds in the property market, with surveyors saying fewer people were househunting and buyers were losing confidence. In fact consumer confidence hit record lows. There was no real rush to buy, and mortgage approvals for purchases stuck below pre-pandemic levels,” said Sarah Coles, senior personal finance analyst, Hargreaves Lansdown.

“However, the storm broke this week, with around 40% of mortgages being pulled from shelves, because the pace and scale of the collapse in the bond market meant it was impossible to sensibly price them. When the dust settles, and lenders come back to the market, we can expect eye-watering rises in interest rates.”

“This needs to be seen in the context of how dramatic house price rises have been in recent years, and the fact that our bills have raced away too. Even if people are still keen to buy, they may no longer qualify for a mortgage on affordability terms.”

UK GDP expands 0.2% as growth revised higher

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UK GDP expands 0.2% as growth revised higher

The UK economy actually grew in the second quarter as initial estimates of a 0.1% contraction were revised higher.

With the economy growing the second quarter, the prospect of a technical recession will be pushed back.

“The Final UK GDP rate for second quarter 2022 came in at 0.2%, beating the -0.1% initial expectations. The figure is surprising given the growth outlook for the UK has been deteriorating since the start of the year. There were increases in services and construction output, while production fell,” said Tom Hopkins, Portfolio Manager at BRI Wealth Management.

GBP/USD continued a move the upside on the news and was 0.2% higher at 1.1144 at the time of writing.

Despite the revisions higher in second quarter GDP, the outlook for the Uk economy still remain uncertain with rising rates and a cost of living crisis likely to push the economy into contraction in the third quarter.

Salinity Solutions: On a mission to treat water better

UK Investor Magazine
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Salinity Solutions: On a mission to treat water better

As the global demand for water continues to grow, how do we reduce the vast amount of energy used in water treatment? A Coventry-based company claims to have the answer.

While we think of ourselves as residents of a blue planet, only 0.5% of the earth’s water is in the form of available fresh water. That’s the kind we need to survive. The supply of fresh water has been steadily decreasing, while demand has been rising. In the 20th Century, the world’s population quadrupled – but water use increased six-fold.

To access this finite resource, a huge unseen global industry pumps, treats and redistributes water to homes, farms and factories. But only if you’re lucky enough to live in a country with adequate water supply. According to Unicef, half of the world’s population could be living in areas facing water scarcity by as early as 2025.

The water industry consumes vast amounts of electricity – 978 trillion Watt-hours (tWh) in 2020, which is 4% of the world’s total energy, or enough to power almost 500 million electric cars for a year (roughly half the number of cars on the planet). 

And this energy requirement is predicted to rise to almost 1500 tWh by 2040. 

Meanwhile 80% of wastewater is released into the environment untreated. To improve the water quality of lakes, rivers and oceans more water treatment solutions are needed, which will in turn increase our energy consumption. 

And where does all this energy come from? Currently 80% of the world’s electricity is generated from fossil fuels. 

In order to get even close to the net zero goals of 2050, we need to improve the way we treat water, while reducing the energy it uses.

Part of the solution lies in better water treatment technologies, specifically ones that provide greater energy efficiency and versatility.  

Salinity Solutions is on a mission to treat water better. After 10 years of development at the University of Birmingham and Aston University, their high recovery batch reverse osmosis (RO) system operates in a way that is over 50% more energy efficient than traditional RO systems (for an explanation of RO and how Salinity’s technology works visit salinitysolutions.co.uk/product/), offering significant savings in water treatment cost and carbon footprint. Plus, their compact, mobile units are scalable for a wide range of applications, for example solar powered units operating in remote areas. 

Founder and CTO Tim Naughton added: “We are making the biggest step forward in water treatment in over 50 years. Our vision is to drastically cut the energy consumed by water treatment and deliver a sustainable solution to water scarcity.

“We’ve recently completed successful field trials with Cornish Lithium and we’re now looking at a wide range of other water treatment applications, including industrial, medical and agricultural. Our tests show that our system delivers 95% water recovery, or 20x brine concentration, for just 0.5kWh per tonne of feedwater, which is an industry game changer. Traditional RO systems operate at around 2-3 kWh/m3. We’re hoping to make a significant impact in a market projected to reach a value of 490 billion US dollars by 2029.

“Increasingly we’re hearing from major industry players that our combination of ultra-high energy efficiency and ultra-high recovery is ‘the holy grail’ for the next generation of water treatment systems.

“We’ve just had our first European patent approved and there are four more in the pipeline. This marks a significant milestone for us and a step up in value of the business.”

Salinity Solution is closing its Crowdcube funding round on Tuesday October 4th. To invest, visit their campaign page. If you are interested in investing more than £20,000, you should contact the company direct on info@salinitysolutions.co.uk .

Investments of this nature carry risks to your capital. Please Invest Aware.

Sources:
Wastewater market global size; Wastewater release; Energy consumption by water sector; World energy outlook;Volume of global car production; EV energy consumption: Fresh water; Fossil fuels; Water scarcity

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