OZL unimpressed by BHP Group’s $5.8bn offer

Natasha Doris
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OZL unimpressed by BHP Group’s $5.8bn offer

BHP Group reported its submission of a non-binding indicative proposal to the Board of OZL to acquire 100% of the issued capital in the group via a scheme of arrangement on Monday.

The firm announced its proposal to acquire all of OZL’s shares for cash consideration at AUS $25 per share, amounting to a total of approximately $5.8 billion.

The offer price represents a premium of 32.1% to OZL’s closing price of AUS $18.92 per share on 5 August 2022 and 41.4% to OZL’s 30-day VWAP of AUS $17.67 per share on 5 August 2022.

BHP Group commented the offer would deliver immediate value to OZL shareholders and de-risk any value which may eventually end up reflected in the group’s share price.

The company added the proposal would be subject to the completion of certain conditions, including confirmatory due diligence, entry into a scheme implementation, and a unanimous recommendations from the OZL board that its shareholders vote in favour of the proposal, in the absence of a more attractive agreement.

However, BHP Group said OZL had so far indicated a lack of interest in the proposed agreement.

“Our proposal represents compelling value and certainty for OZ Minerals shareholders in the face of a deteriorating external environment and increased OZL operational and growth related funding challenges,” said BHP Group CEO Mike Henry.

“We are disappointed that the Board of OZL has indicated that it is not willing to entertain our compelling offer or provide us with access to due diligence in relation to our proposal.”

BHP Group shares fell 1% to 2,224p in early morning trading on Monday.

Clarksons achieves record year on global shipping shortages and weakened dollar

Natasha Doris
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Clarksons achieves record year on global shipping shortages and weakened dollar

Clarksons shares slid 1.8% to 3,490p in early morning trading on Monday, following a record revenue growth to £266.7 million against £190.1 million in HY1 2021.

The shipping services group attributed its revenue climb to long-term supply and demand dynamics of the shipping market, which reportedly put upward pressure on rates. The company noted particularly strong performance in its Broking sector.

Clarksons added that it benefited from the weaker Pound Sterling against the US dollar, contributing to additional revenues.

Clarksons confirmed a 53.5% underlying pre-tax profit growth to £42.2 million in HY1 2022 compared to £27.5 million the last year, along with a reported pre-tax profit of £42.2 million against £27.3 million.

The group noted a high performance across its dry cargo, sale and purchase and tanker markets in its Broking division as contributing factors to HY1 profits, as sustained volumes and rates boosted profits in the financial term.

The company mentioned a strong HY2 2022 outlook, with the structural supply shortage in the global shipping fleet boosting guidance for freight rates and asset values, alongside good momentum going forward.

“I am pleased to report that Clarksons has had a strong first six months of 2022, with a positive performance across all divisions,” said Clarksons CEO Andi Case.

“The outlook for the business remains strong due to the structural supply shortage in the global shipping fleet and we continue to benefit from our international footprint, leading market position, diverse offering and a deep understanding of the energy transition.”

Meanwhile, the firm highlighted an underlying EPS rise to 98.5p from 63.5p.

Clarksons announced a hiked interim dividend per share to 29p compared to 27p in the previous year.

New Aquis admission: Inteliqo sales plans

Andrew Hore
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New Aquis admission: Inteliqo sales plans

Guernsey-based Inteliqo Ltd plans to become a distributor of a range of technology products. The first is an earbud that can translate 42 languages in real-time. The management believes that the flotation will help it to gain and collaborate with clients and resellers.
There is limited liquidity with little more than 2% of the shares not held by the five main shareholders. A lock-in agreement means that more than 90% of the shares cannot be sold for 12 months. This is reflected in the bid/offer spread of 1p/4p, which effectively means that the share price was unchanged on the first day of deal...

Aquis weekly movers: Wishbone Gold gets second drill rig

Andrew Hore
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Aquis weekly movers: Wishbone Gold gets second drill rig

Wishbone Gold (LON: WSBN), which is also quoted on AIM, reported encouraging visual drilling results at the Red Setter project, Patersons Range, Western Australia. This has prompted management to secure a second drilling rig, which should start drilling at around 10 August. The share price jumped by 16.3% to 12.5p.

Electric vehicle drivetrain technology developer Equipmake Holdings (LON: EQIP) shares went to a premium on the first day of trading at the end of July and the share price has risen further in the past week. It has increased from 5.875p (5.5p/6.25p) to 6.375p (6p/6.75p). There were ten trades during the week, all of them at 6p or above. The highest price was 6.82p.

Chris Akers has increased his stake in Quetzal Capital (LON: QTZ) from 21% to 22%. John Mahtani has cut his stake from 3.83% to below 3%. The share price increased by 6.35% to 3.35p.

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Fallers

The ChallengerX (LON: CXS) share price appears to have been hit by a trade of 400,000 shares at 0.4p each, which was well below the market price. The shares in the digital sports club marketing company slumped by 60% to 1p (0.9p/1.1p).

Despite the announcement of a new investment, Quantum Exponential Group (LON: QBIT) the share price declined by 5.9% to 2.4p. Quantum Exponential is the first UK-quoted investment company that is focused on quantum technology. A £450,000 investment has been made as part of a £12m fundraising by QLM Technology Ltd, a photonics hardware and technology developer. It has developed a gas imaging camera based on quantum technology. The technology will be integrated into lead investor Schlumberger’s end-to-end emissions solutions business. It can be used to quantify greenhouse gas.

Quantum Exponential had previously made three investments at a total cost of £1.16m since flotation. There are discussions with more potential investments. There has been further progress towards setting up a fund. Anthony Lyall has been appointed as investment manager and Anna Spandl as investment analyst.

AIM weekly movers: Question mark over Quiz rise and Revolution Beauty loses its shine

Andrew Hore
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AIM weekly movers: Question mark over Quiz rise and Revolution Beauty loses its shine

Clothing retailer Quiz (LON: QUIZ) is the best performer of the week, with the share price 44.8% higher at 15.925p. Schroder reduced its stake to below 10%, but there was no other news during the week. There was a noticeable increase in trading volumes. There wee more than one million shares trade on 2 August. This is the highest number traded in one day since the end of April when there were 165,000 shares traded. There were 1.3 million shares traded in the week.

The detection technology developer Kromek (LON: KMK) share price soared 35.1% 12.5p after the annual results announcement and a £1.7m convertible loan note fundraising with an 8% interest rate. The loan notes are convertible at 15p a share. In the year to April 2023, finnCap expects revenues to increase from £12.1m to £18m and the loss should fall from £6m to £4.9m. There is good revenue visibility.

Information provider GlobalData (LON: DATA) increased interim revenues by 23% to £111.9m, including organic growth of 10%. Subscription revenues were 83% of the total. Invoiced forward revenues are 37% ahead at £114.6m. Underlying earnings were 27% higher at 20.7p a share. The interim dividend was raised by 26% to 7.7p a share. Acquisitions meant that net debt quadrupled to £190.5m. The share price jumped 34.2% to 1275p.  

Amur Minerals Corporation (LON: AMC) is proposing the disposal of the Kun-Manie project in Russia to Bering Metals for $35m. This asset is in the books at $24.3m, although there was a previous higher offer where payments were spread over 15 years which was rejected by shareholders. The share price jumped 32.3% to 1.27p, which capitalises the company at £17.7m. A special dividend of 1.8p a share is promised if the disposal gets shareholder approval.

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Fallers

Cosmetics supplier Revolution Beauty (LON: REVB) Revolution Beauty is the latest of the 2021 AIM new admissions to put out a trading warning that has sent the share price tanking. It is the worst performer of the week and declined 65.1% to 18.5p. The July 2021 placing price was 160p. Revolution Beauty has delayed its 2021-22 results and cut its expectations for 2022-23. Poor retail demand in the US and the loss of £9m of Russian and Ukraine revenues have hit the new financial year. Online demand is switching to store sales and cost increases have hit profitability. Zeus has cut its 2022-23 EBITDA forecast by 38% to £19m, while higher net debt means that earnings are reduced by 64% to 1.5p a share. Jupiter Fund Management has reduced its stake from 16.8% to 11.5%.

Tower Resources (LON: TRP) shares have slumped after it announced a £1.5m fundraising at 0.175p a share. The share price declined 29.1% to 0.202p. The oil and gas company is progressing with the financing of its NIOM-3 well in Cameroon and the cash raised will go towards payments on account for services associated with the well while the financing is secured and for working capital.

Sabien Technology (LON: SNT) is raised £500,000 through a placing at 10p a share, and then a further £100,000 from existing shareholders via an oversubscribed broker option. The cash will be used to finance the company’s green technology businesses. The share price dived 27.7% to 11.75p.

Western Siberia-focused oil and gas company Petroneft Resources (LON: PTR) shares fell 20.5% to 0.875p after it was given a three-month extension for the publication of its 2021 results. The share price has been in decline since the Russian invasion of Ukraine. The reservoir stimulation at the Tungolsky licence 61 has been completed and that should add 200 barrels of oil a day. The company is truing to maximise exports. Total production in the five months to the end of May 2022, there were 285,710 barrels of oil produced and the average price is higher than in the same period last year.

Yacht services provider GYG (LON: GYG) fell sharply after asking shareholders to agree to it dropping its AIM quotation at a meeting to be held on 31 August. The shares fell 19% to 25.5p, having been as low as 20p at one point. Poor trading in recent years and lack of investor interest are two reasons for the proposed cancelation. Costs can be reduced by €700,000 a year. There is a lack of capital to grow the business. Harwood Capital, which previously considered a 92.5p a share bid for GYG, has increased its stake from 20.5% to 22.2%.

QinetiQ increases US exposure

Andrew Hore
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0
QinetiQ increases US exposure

After the London market closed, QinetiQ Group (LON: QQ.) announced it had agreed to acquire Avantus Federal from NewSpring Holdings for an enterprise value of £483m ($590m), including a $70m tax asset. The deal requires US regulatory approval.

QinetiQ has secured £350m of new debt facilities and will have a £275m revolving credit facility that is currently undrawn. Cash generation should rapidly reduce gearing. The deal is immediately earnings enhancing.

Avantus is a cyber, data analytics and software developer for sectors including defence, intelligence and homeland security. In the year to June 2022, Avantus revenues were $298m and adjusted operating profit $32m. There is a track record of double-digit revenue growth.

Avantus will be merged with the existing QinetiQ subsidiary in the US, which will double in size. The UK will remain the larges generator of revenues, but it is one-fifth of the size of the US market and QinetiQ already has a 35% share of relevant markets in the UK.

US market share will be around 3%. The market is worth more than £15bn a year and the potential market is growing at 3% a year. The customer base will be broadened by the deal.  

The QinetiQ share price was 376p at the end of the week. That is not far from the 2022 high.

Light Science Technologies Holdings shares drop on widened £1.3m pre-tax loss

Natasha Doris
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0
Light Science Technologies Holdings shares drop on widened £1.3m pre-tax loss

Light Science Technologies Holdings shares dropped 9% to 7.5p in late afternoon trading on Friday after the company announced a widened pre-tax loss of £1.3 million in HY1 2022 compared to £900,000 the year before.

The firm reported a slightly reduced margin of 20.9% against 23.6% in the previous year.

However, Light Science Technologies highlighted a revenue climb of 42.% to £3.6 million from £3.4 million in HY1 2021.

The company also confirmed the launch of its planned programme of investment in across the FY period.

Its post-period highlights included the commencement of its SensorGROW SaaS (Software as Services), which is set to growers with business intelligence to optimise plant growth and optimise business operations.

Light Science Technologies also reported the launch of its ‘slimline’ low profile tuneable light, which is designed to maximise growing space in Vertical farm projects, expanding the group’s reach of its nurturGROW CEA lighting solutions.

“With Group revenue increasing by 4.2% for the six months to 31 May 2022, alongside our forward order book and contracts worth £18 million, we have seen an increase in our pipeline of quoted business due to a demand for reshoring manufacturing to the UK, as customers look to increase product security and reduce risk,” said Light Science Technologies Holdings CEO Simon Deacon.

“As much as the macro trends are challenging in the short term, we are confident that the medium and long-term outlook for the Group is promising, as the market continues to grow.”

“With our experienced team, our technologies and energy saving products feeding into the growing pipeline, we are in a strong position to take advantage of the opportunities and achieve our objectives. We remain confident in our ability to achieve our revised forecasts as announced on 10 June 2022.”

Inspired trading in line with expectations as demand for ESG services grows

Natasha Doris
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Inspired trading in line with expectations as demand for ESG services grows

Inspired shares fell 1.3% to 12.1p in late afternoon trading on Friday, after the group confirmed its HY1 2022 results were set to come in line with market expectations in its trading update for the period.

The technology service provider announced progress in its planned strategy, with strong trading and a continued growth in underlying cash generation against HY1 2021.

Inspired, which built its business model on assisting companies in their journey to net zero, confirmed that energy had become a “high priority” for the firm.

The group commented its Energy Optimisation Services were especially strong across the financial period, with accelerating demand reported in its Inspired ESG services.

“Against a challenging market and macroeconomic backdrop, we are pleased to report a period of solid growth, with the Optimisation and ESG divisions gaining particularly good traction in particular, a trend we see continuing into the second half,” said Inspired CEO Mark Dickinson.

“The transition to Inspired plc a year ago has enabled us to strengthen our platform and leading market position as we support businesses in their response to the ongoing energy crisis and climate emergency.”

DeepVerge shares tumble as FY 2022 revenue expectations drop

Natasha Doris
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0
DeepVerge shares tumble as FY 2022 revenue expectations drop

DeepVerge shares tumbled 10.8% to 13.6p in early afternoon trading on Friday, after the group announced a lowered revenue expectation of approximately £18 million in FY 2022.

The company said the lower revenue would be reflected in a smaller projected EBITDA and a slight fall in gross margins, alongside a small increase in overheads.

DeepVerge reported a HY1 revenue growth of 95% to £6.4 million compared to £3.3 million in HY1 2021.

The firm noted a 128% surge in orders in HY2 to over £8.8 million against £3.9 million the last year.

The group added its Modern Water business saw £6.5 million in orders secured to the close of July, representing a 116% climb in one month, along with multiple £1 million installation bids still outstanding for site installations.

DeepVerge mentioned a Labskin and Skin Trust Club sales growth of £1 million, with 27,000 club members and over 300 products added to the marketplace, with an additional 200 products scheduled to be added.

The firm also commented on its prospect pipeline, which has seen success in converting its opportunities into firm orders for delivery in FY 2022, with £6.5 million in deals across China, South Asia, India and Africa.

However, the company warned there was uncertainty as to whether its conversion rate over the coming months would meet previously expected levels.

“H1 2022 has been another exceptional fast growth period for DeepVerge. Modern Water is in the right place at the right time, to deal with the global water crisis,” said DeepVerge CEO Gerard Brandon.

“Also, Skin Trust Club has hit a rich vein of consumer desire to take control by personalising the skin care industry which can be seen by the rush of skin care products being added to the Skin Trust Club marketplace, that only began in Q1 this year.”

“Although full year 2022 revenues might be lower than previously guided, sales and orders continue to rapidly expand across all divisions in the current macroeconomic and geopolitical environment. We have taken a prudent stance to guide the market on year-end revenue and will provide further updates as necessary.”

US adds 528,000 jobs in July despite recession concerns

Natasha Doris
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0
US adds 528,000 jobs in July despite recession concerns

The US added 528,000 jobs in July, according to the US non-farm payroll report released today.

Meanwhile, the unemployment rate fell to 3.5% across the country, coming in below the 3.6% market estimate.

The Bureau of Labour Statistics also revised the growth in June to 398,000 payrolls from 372,000 and updated May’s results to 386,000 jobs from 384,000.

The soaring results appeared to defy recession concerns and rising interest rates, with the employment figures smashing expectations despite the volatile macro-economic environment.

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