AIM movers: Croma Security falls, while Tlou Energy gets cash injection

Andrew Hore
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AIM movers: Croma Security falls, while Tlou Energy gets cash injection

Croma Security Solutions (LON: CSSG) shares have slumped 19.1% to 51.4p as pre-tax profit fell in 2021-22, although that was down to a sharp reduction in Covid-related government support. There was a cash outflow during the year. New contracts have been won, although many existing ones are coming up for renewal.

Immupharma (LON: IMM) says Avion Pharmaceuticals is continuing to support the Lupuzor clinical programme. The clinical programme for the lupus treatment is being redesigned due to FDA feedback. There is also a potential distribution agreement for Avion drugs. The share price still fell 10.9% to 2.945p after this news.

Prospex Energy (LON: PXEN) says its partner in its gas resources in southern Spain, Warrego Energy, is merging with Strike Energy and intends to dispose of its Spanish assets. This will mean that there could be uncertainty about progress with the El Romeral gas to power plant until the ownership is sorted out. That knocked 8.9% off the share price to 10.25p.

Construction claims and disputes consultancy Driver Group (LON: DRV) made an underlying loss in the year to September 2022, but management believes that the Middle East and Asian operations should return to profitability this year. Europe and the Americas remain profitable. The share price fell 5.17% to 27.5p.

Tlou Energy (LON: TLOU) has raised a further £1.7m at 2p a share from Dr Ian Campbell, taking his stake to 19.2%. He is willing to provide further funds, and this could accelerate the planned drilling campaign to produce gas to supply the proposed 10MW power project in Botswana. The share price rose 11.8% to 1.9p.

Applied Graphene Materials (LON: AGM) and PCF Group (LON: PCF) have regained some of their losses from earlier in the week. Applied Graphene Materials has not been able to raise cash from a share issue and more cash will be required at the beginning of 2023.  The share price rose 10.5% to 4.75p, but it has still more than halved on the week. PCF Group has also been unable to raise money or secure a strategic transaction, so PCF Bank is withdrawing from the UK banking market. The PCF board wants shareholder approval for the cancellation of the AIM quotation. Even after a 150% jump to 0.925p, the PCF share price is still down by two-fifths this week.

Yesterday afternoon Alba Mineral Resources (LON: ALBA) raised £500,000 at 0.1p a share. Part of the subsequent fall in the share price has been clawed back today with a 7.14% rise to 0.1125p.

Shares in Bens Creek (LON: BEN) have recovered 6.16% to 23.25p after the coal miner reassured investors concerning 56.8% shareholder MBU Capital entering into a charge in favour of Bluestar Global Capital, which already has a shareholding of 3.97%, most of which were acquired at 30p each. The loan lasts for 12 months and there is no margin call related to share price performance.

Investing better with Vietnam Holding

Vietnam Holding
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Investing better with Vietnam Holding

“We are a long-term investor, and responsible investing helps us select quality companies with sustainable business models and identify and manage potential risks in our portfolio.” – Sean Hurst, Chair of VNH’s ESG Committee

Over the last year, Vietnam Holdings (VNH) has established itself as a leader in responsible investing activities in the Southeast Asian country. VNH received five-star scores for its 2021 PRI reporting, which is the largest global reporting project on responsible investment. The carbon footprint of VNH’s 2021 portfolio, meanwhile, is 67.5% lower than the Vietnam All Share Index (VNAS) benchmark, while also outperforming the VNAS index on a year-on-year basis. This can be attributed to sector allocation – with a focus on less carbon-intensive non-manufacturing sectors – as well as stock selection, featuring best-in-class companies actively pursuing emissions reduction initiatives. 

Over the last 12 months, Dynam Capital, VNH’s investment manager, has also been active in company engagement through both private meetings and collaborative engagement. In March, for example, Dynam hosted a webinar for 50 companies operating in Vietnam to talk about how to increase the accuracy of carbon footprint reporting. This was organized together with Vietnam Energy and Environment Consultancy JSC.

ESG, short for Environmental, Sustainable, and Governance, is an increasingly common phrase in the corporate and investment sectors, but it is not without its critics. Hurst acknowledged these issues, while also affirming that VNH is extremely careful in approaching the topic. “There is a growing concern among some investors about the practice of ‘greenwashing,’ a fear that ESG has somehow gone too far,” he said. “For VNH, we look at each sector separately, and the ‘E’ is increasingly important, and we were one of the first funds in Vietnam to estimate the carbon footprint of our portfolio.” 

Carbon footprint reporting is still new in Vietnam, with less than ten listed companies disclosing emissions data in their annual reports. VNH, for its part, uses an external professional firm to help estimate the annual footprint of each portfolio company. “But we have seen greater interest in and willingness to do so from companies in the next few years,” said Craig Martin, Chairman of Dynam Capital. “Especially since Prime Minister Pham Minh Chinh announced at COP26 that Vietnam will make efforts to achieve its net-zero targets in 2050.” This serves as crucial context for VNH’s responsible investing efforts, as the fund announced its own net-zero goals just before COP26, aligning with the Vietnam’s government’s agenda.

Officials have taken several steps down this path in the months since the climate summit. In January, a new decree outlined regulations on the reduction of greenhouse gas emissions and protection of the ozone layer. Then, in June, a circular development scheme was approved. It aims to, among other goals, reduce the intensity of greenhouse gas emissions per GDP by at least 15% by 2030. Perhaps most noteworthy is the Power Development Plan 8 (PDP8), which will guide Vietnam’s energy policy until 2030 with a vision to 2045. While the plan has not been finalized and is overdue, drafts have outlined a continuation of the country’s strong renewable energy development in recent years, especially in terms of solar and wind. The most recent PDP8 draft envisions a power mix of 50.7% wind and solar by 2045, with possibly just 9.6% of power coming from coal. Offshore wind, which remains largely untapped, is expected to be a major generator of electricity in the future.

To be sure, these are hugely ambitious goals that will require massive financial investments, but the guidelines are promising, and both investors and private companies have important roles to play.“After COP26, the government’s efforts in changing its energy strategies and relevant policies have shown the country is willing to address climate change,” Martin said. “We think institutional investors in the Vietnamese market have a role in encouraging change, alongside the government and business. Some investors are also specifically looking to invest in companies that provide low-carbon solutions and technology to help the country speed up its decarbonization journey.” 

Writing credit Michael Tatarski

Westminster Group – ‘insider dealings’ have increased significantly this week

Mark Watson-Mitchell
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Westminster Group – ‘insider dealings’ have increased significantly this week

In the last few days a number of substantial share purchases have been recorded on behalf of Westminster Group (LON:WSG) ‘insiders’ and the share prices being paid has increased markedly.

At the start of September in an article titled ‘Westminster Group – giving money away’ I noted that buying the shares at 1.6p in the market looked great value.

Especially so as the group’s brokers were estimating that next year the group could well be showing earnings of 1.6p per share.

The Banbury-based company is a specialist security and services group that operates worldwide through an extensive international network of agents and offices across the globe, situated in France, Germany, Saudi Arabia, Ghana and Sierra Leone.

Delays led to downgrades

At the time a number of big contracts were still under negotiation, with a couple being close to signing-off.

Two months later the group declared that operational delays had seen a slippage in a multi-million Technology project – the news of which saw the shares drift easier to 1.425p.

It also brought about a broker’s downgrade on the group’s earnings.

The nibbling starts

However, since the beginning of this month there has been a constant nibbling away at the company’s shares.

At the start of this week, they responded to sizeable buying and edged up to 1.85p.

On Wednesday the buying persisted, closing at 2.05p.

It now transpires that three of the group’s key executives – the CEO, the CFO and the Co Sec – were buying additional holdings, at prices from 1.78p to 1.88p – a total of 2.137m shares.

Another 1.284m shares were purchased by Directors yesterday at prices ranging from 2.24p to 2.3p per share.

At the same time other company employees also bought shares.

Over 10m shares were traded in the first four days of this week, with dealing volumes up again today.

Conclusion

So close to the £7.5m group’s end of trading year, such activity can only be seen in an incredibly positive light.

‘Insiders’ – the workers on the shop floor who can always see what is going on – have limited times in which they can deal in a company’s equity.

We have already been informed that some substantial contract negotiations are underway – could any of these be close?

UK GDP contracts in Q3 as shallow recession looms

UK Investor Magazine
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UK GDP contracts in Q3 as shallow recession looms

The UK economy shrank in the third quarter according to data released this morning. GDP contracted by 0.2% in the period and set the UK on a path towards recession, albeit a shallow one.

The main culprit behind the reduction in economic activity was soaring inflation that would clearly impact the economy at some point. The Bank of England has recently said the UK is heading towards a prolonged recessions and this morning’s data suggests we could already be in one.

“Technically speaking the UK won’t be in recession until it suffers two consecutive quarters of negative growth. But given the bleak economic picture and forecasts from the Bank of England, it’s quite clear this reading marks the start of what we expect to be a significant recession for the UK economy,” said Joshua Raymond, Director at online investment platform XTB.com.

Services, manufacturing and retail activity all declined in the quarter in a broad slowdown that was also impacted by the Queen’s funeral.

“It’s no surprise the service sector is shrinking, people are going as long as they can between haircuts or resurrecting lockdown methods of trimming their own locks. People are having to spend more to buy less, and they’re terrified of what a cold winter might do to already battered budgets,” said Danni Hewson, AJ Bell financial analyst.

“The manufacturing sector is struggling with a double whammy of rising energy prices and a shortage of some raw materials for some as supply issues are finally working their way through the system, but all 13 subsets of the sector were in decline.”

The initial market reaction was fairly muted with GBP/USD clinging onto gains and the FTSE 100 shrugging the data off to rise 0.3% in early trade, before falling back.

Although today’s GDP read is a stark warning for the UK economy, the better than US CPI data yesterday is by far the biggest news in town and was helping to boost risk sentiment on Friday.

Triple Point Energy Transition Investor Presentation November 2022

UK Investor Magazine
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Triple Point Energy Transition Investor Presentation November 2022

Triple Point Energy Transition presents at the UK Investor Magazine Virtual Investor Conference November.

Download Presentation Slides Here

Triple Point Energy Transition plc “TENT” supports the transition to net zero by investing holistically across the energy sector whilst targeting a diversified and sustainable income for investors.

TENT invests across the energy sector focusing on three thematic areas:

• Generation of energy – ensuring less energy loss by investing in lower carbon energy generation closer to where it is consumed.
• Storage and distribution of energy – stabilising the grid and managing the imbalance of generation and consumption by funding energy storage solutions.
• Reducing demand for energy – maximising energy efficiency by providing the same output in a more efficient way either through energy efficiency measures or producing energy onsite.

JLEN Environmental Assets Investor Presentation November 2022

UK Investor Magazine
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JLEN Environmental Assets Investor Presentation November 2022

JLEN Environmental Assets presents at the UK Investor Magazine Virtual Conference.

Download Presentation Slides Here

JLEN’s investment policy is to invest in a diversified portfolio of Environmental Infrastructure. Environmental Infrastructure is defined by the Company as infrastructure assets, projects and asset-backed businesses that utilise natural or waste resources or support more environmentally friendly approaches to economic activity, support the transition to a low carbon economy or which mitigate the effects of climate change. Such investments will typically feature one or more of the following characteristics:

  • long-term, predictable cash flows, which may be wholly or partially inflation-linked cash flows;
  • long-term contracts or stable and well-proven regulatory and legal frameworks; or
  • well-established technologies, and demonstrable operational performance.

India Capital Growth Fund Investor Presentation November 2022

UK Investor Magazine
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India Capital Growth Fund Investor Presentation November 2022

The India Capital Growth Fund presents at the UK Investor Magazine Virtual Conference November 2022.

Download Presentation Slides Here

Ocean Dial is a FCA regulated investment firm specialising in India. We are bottom up investors who seek to deliver superior absolute returns over the long term. We operate in a market with historically strong and consistent earnings growth where elevated volatility has provided regular mispriced entry points.

Our Mumbai based team conducts fundamental proprietorial research on behalf of two differentiated strategies supported by an investment and operational risk infrastructure combined with a compliance function based in London.

FTSE 100 reverses early losses to explode higher after US CPI data

UK Investor Magazine
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FTSE 100 reverses early losses to explode higher after US CPI data

The FTSE 100 reversed early losses and exploded higher after US CPI inflation missed expectations.

US October Consumer Prices rose only 0.4% month-on-month versus expectations of 0.6% and Core consumer price rose 0.3% vs 0.5%.

The immediate market reaction saw US bond yields fall with the dollar and US equity futures surge. NASDAQ futures were 3.3% higher at the time of writing. The FTSE 100 spiked around 60 points in the minutes after the announcement.

Markets were also marking down expectations of another 75 bps hike in December. If this starts a trend of lower inflation numbers, perceptions of when the Fed will ‘pivot’ will adjust and support equities.

FTX collapse

European markets had started the day on the back foot after the FTX crypto exchange effectively became worthless.

The bankruptcy of FTX had dragged on US exchanges overnight as markets accessed the wider implications of the severe losses it would mean for individuals and businesses. Although crypto is seen as an alternative to mainstream finance, crypto has become embedded into the financial system as such dramatic losses will see a huge loss of wealth for many across the world.

“It has been a wild week in Cryptoland, with the implosion of the FTX crypto exchange, which is now reported to have an $8bn black hole at the heart of it. At the beginning of the week its founder Sam Bankman-Freid was reportedly worth $16bn, Bloomberg reckon 95% of that disappeared in a single day, the fastest pace of one person losing money in history.” said Steve Clayton, Head of Equity Funds, Hargreaves Lansdown.

FTSE 100 Corporate Results

It was again a busy day for the FTSE 100 in terms of corporate updates. Companies reporting today included AstraZeneca, Centrica, Haleon and National Grid.

Centrica was the FTSE 100’s top gainer after the utility company said they expected results for the 2022 FY to be at the top end of sell side analyst expectations.

“British Gas owner, Centrica, who recently reopened the rough gas storage facility announced that trading has been strong and the company steered analysts toward upgrading their numbers. The strength is coming from their upstream oil and gas production operations, whilst retail profitability is struggling. The company announced a further £25m of funding for customer assistance as people struggle with their rising energy bills,” said Steve Clayton

AstraZeneca shares built up steam during the session and helped add a notable number of points to the FTSE 100. AstraZeneca shares added 3.5% after reporting a whopping 37% increase in nine month revenue to $33.1bn.

“This was a strong performance by AstraZeneca reflecting good growth from its higher value medicines. But what’s really exciting is its continuing high hit rate in terms of R&D successes. 19 Major regulatory approvals since the last update help underpin the outlook for sustainable long-term growth, and there is likely to be more to come with 18 Phase III read-outs expected in 2023,” said Derren Nathan, Head of Equity Research at Hargreaves Lansdown.

Auto Trader maintains strong margins but warns of uncertainty

UK Investor Magazine
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Auto Trader maintains strong margins but warns of uncertainty

Auto Trader’s revenue revved up in the first half as their extensive partnership base helped raise sales.

Average revenue per retailer rose to £205 to £2,404 while the number of forecourts rose to 2% to 14,161.

The forecourt strength was dampened slightly by lower activity on their digital platforms by car buyers which fell 10% to 67.7 million per month in the first half of the 2023 FY1. Visitor minutes were also down.

Nonetheless, Auto Trader revenue for the period rose 16% to £249.8m.

There was a warning of uncertainty but Auto Trader pointed to the less cyclical nature of second hand cars as a reason to be positive.

“Auto Trader is accelerating into the second half with excellent momentum. Performance in the first half saw revenues and profits come in better than expected, which is a function of Auto Trader’s enviable recurring revenue, strong pricing power and highly profitable model,” said Sophie Lund-Yates, Equity Analyst at Hargreaves Lansdown.

“Running a website doesn’t cost a lot, after all. Underlying operating margins north of 70%, with strong conviction that these can be maintained, are an asset very hard to find in the current environment.”

AstraZeneca, Market Catalysts and a NASDAQ IPO with Alan Green

UK Investor Magazine
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AstraZeneca, Market Catalysts and a NASDAQ IPO with Alan Green

Alan Green joins the Podcast as we delve into key markets theme and a number of UK equities.

We discuss:

  • AstraZeneca (LON:AZN)
  • Georgia Capital (LON:CGEO)
  • Vela Technologies (LON:VELA)

We start by looking at potential catalysts for markets as we move into the winter.

AstraZeneca has reported a solid set of third quarter results as the company sees the benefits of higher cancer drug sales.

Georgia Capital has been trading at deep discount to NAV and Alan outlines why he sees strength in the business going forward.

Vela Technologies shares jumped this week as they announced the IPO of a portfolio company on the NASDAQ.

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