Mirriad Advertising shares tumble as HY1 revenue halves on disappointing China performance

Natasha Doris
-
0
Mirriad Advertising shares tumble as HY1 revenue halves on disappointing China performance

Mirriad Advertising shares tumbled 41.6% to 8.6p in late afternoon trading on Friday after its HY1 revenue was almost halved to £577,000 from £1.1 million year-on-year.

The company attributed its lower revenues to the “seasonal nature of key advertising markets” and its present sales pipeline, with higher revenues projected for HY2.

Mirriad Advertising reported an 85% drop in its China revenues to £123,000 against £820,000, linked to Covid-19 lockdowns and contractual changes removing guaranteed income from the region.

The marketing firm said it aimed to wind down its Chinese operations by the end of its Tencent contract in March 2023, targeting annual cost savings of £1 million after the board decided it was not prudent to budget for the awaited rebound in the country’s market.

However, its US revenues climbed 57% to £418,000 compared to £266,000 in HY1 2021, currently accounting for 72% of total revenue.

Mirriad Advertising confirmed cash of £17.7 million at the end of June 2022 from £29.8 million year-on-year, with year-end cash expected to exceed market expectations on the back of cost savings and lower than expected budgeted bonus provisions.

The company highlighted improvements recorded across all KPIs on supply and demand sides, and its cost control programme, which is set to deliver £2.5 million of total annualised costs savings, with the majority to be achieved in FY 2023.

It added the firm would be leaning into digital advertising in the EU and APAC to reflect initial progress made on the digital front in North America.

“Our positive US momentum is diluted by the disappointing results of our operations in China, stemming from the unexpected length of stringent lockdowns and a challenging macro environment overall,” said Mirriad Advertising CEO Stephan Beringer.

“The decision to make an orderly wind down of our operations at the end of the Tencent contract does not impact our overall route to scale, which is rooted in standardisation and integration with the wider advertising ecosystem and enhancing our advanced programmatic capabilities.”

Mirriad Advertising commented it expected far stronger revenue in HY2 2022 on the assumption of a significantly backloaded revenue profile.

“In our priority markets we are seeing a clear in-content interest surge – moving it from novel consideration to must-have and we expect our revenue-generating activity to be backloaded towards the end of the year, as per industry norms,” said Beringer.

“We are also within the Company’s expectations of cash consumption and cash balance as the whole Mirriad team works to convert our high-quality and varied pipeline at pace.”

Titon Holdings shares fall as cost inflation and ERP System complications eat into revenues

Natasha Doris
-
0
Titon Holdings shares fall as cost inflation and ERP System complications eat into revenues

Titon Holdings shares were down 8% to 75.8p in late afternoon trading on Friday on the back of continued margin erosion due to cost inflation, alongside shortages in raw materials and components in FY 2021/2022.

The firm said it would instigate price increases for its products in a move to mitigate the effects of the volatile macro-economic environment and lower the impact on its margins for the FY financial period.

Titon Holdings also noted unforeseen operational impacts linked to the implementation of the new internal ERP system for its UK and Europe operations.

The ERP system is reportedly a critical component for the group’s business improvement and is a necessary part of its growth strategy.

However, its introduction led to short-term production despatch delays, resulting in lower than expected revenues for the last three months of trading.

Additionally, ERP delays brought further costs for system development, rising labour expenses to ramp up production, and costs for staff retention.

Titon Holdings commented its issues were being resolved and sales had returned to normal levels, but the cost disruption resulted in a sales fall unlikely to be recovered over FY 2021/2022.

The company said it consequently expected its results for the FY term to come beneath management expectations.

The firm added its revenues in the rest of the world had remained unsatisfactory, with South Korea revenues disappointing as a result of delays to construction projects and a shift in market demand to ventilation products from natural ventilation.

Titon Holdings confirmed it expected a better than expected small profit from its Korea and 49%-owned associate company Browntech Sales, despite its problems over the period.

It also mentioned expected revenues from sales of mechanical products bought-in by Browntech Sales to start accruing in FY 2022/2023.

The company currently has a positive balance sheet, with cash balances of approximately £3 million at 30 June 2022 and no debt.

“We are obviously disappointed that the Group’s trading performance for the FY21/22 full year will be lower than previously indicated due to the margin pressures we have experienced and the production and despatch issues we have suffered from in the last three months as we implemented our new ERP system,” said Titon Holdings executive chairman Keith Ritchie.

“We will continue to actively manage the market-wide supply chain and inflationary challenges and seek to increase our factory output for the remainder of the financial year.”

“We thank all of our customers for their patience as we work to fulfil their orders and our employees for their continued hard work. Despite these difficulties we remain confident in our medium-term future, supported by our strong financial position.”

Retail sales fall 0.1% in June as fuel and clothing sales decline

Natasha Doris
-
1
Retail sales fall 0.1% in June as fuel and clothing sales decline

Retail sales across the UK fell 0.1% in June, according to the latest figures from the Office of National Statistics (ONS).

The organisation also downgraded its retail figures in May to a 0.8% drop from its initial estimate of 0.5%.

“The bottom lines is people are buying less. Big ticket items are being put on hold until life becomes more affordable,” said AJ Bell investment analyst Danni Hewson.

“Day to day spending requirements are being carefully weighed and costed, and when the price tag gets too high there’s no choice but to cut back.”

Jubilee boosts food sales

Food sales grew 3.1% as people across the UK celebrated the Platinum Jubilee, with snacks, alcohol and sweet treats driving grocery figures as consumers indulged in parties thrown to commemorate the special occasion.

“People did splurge on their street parties, house parties and bank holiday breaks. The nation raided supermarket shelves for party snacks, filled trollies with cases of beer and wine, and in some cases even bought all the bits needed to whip up a Jubilee pudding,” said Hewson.

“It was a moment to lose themselves, to push problems aside and enjoy the festivities with friends and families. But June’s 0.1% fall in retail sales won’t fool anybody – the sector is under siege and the Jubilee celebrations papered over the cracks at best.”

Fuel sales fall on spiking prices

A cold reminder of the cost of living crisis hit in the spectre of fuel sales, which slid 4.3% as crushing petrol prices forced motorists to cut back on filling up their vehicles.

“With prices at the pumps hitting record levels motorists had to think carefully about every journey,” said Hewson.

“If it was manageable people were swapping four wheels for two, or pulling on their trainers to avoid using what is beginning to feel like the liquid gold needed to power our motors.”

Retail sales decline

Non-food store sales fell 0.7% as a result of a 4.7% drop in clothing store volumes and a 3.7% decline in furniture stores.

Customers pared back on clothing and big retail investments as the enthusiasm to stock post-lockdown wardrobes died down, and soaring 9.4% inflation tamped down consideration of pricy purchases such as new household items.

“The rush to refresh wardrobes is over. Clothing sales have plummeted, perhaps partly because shoppers have bought their holiday attire and celebratory outfits, but mostly because prices have been creeping up and retailers know affordability is an issue,” said Hewson.

Online shopping

Non-store retailing, such as online shopping, fell by 3.7% year-on-year. However, sales volumes were 20.8% above February 2020 levels.

The proportion of online retail sales fell to 25.3% over the month, reaching its lowest proportion since March 2020 and continuing a downward trend since its peak in February 2021.

“It’s no co-incidence that designer sofa maker Made.com has issued its third profit warning in the last week. Online retail has taken a big hit and virtual household goods stores have watched sales tumble almost twenty percent in the last year,” said Hewson.

“It’s not a pretty picture and, with inflation expected to heat up further just as that all important golden period begins, the sector will be nervous.” 

“Savings are dwindling and simply covering day to day living costs is becoming harder.”

JTC revenue grows 8-10%, M&A pipeline remains active on new business acquisitions

Natasha Doris
-
0
JTC revenue grows 8-10%, M&A pipeline remains active on new business acquisitions

JTC shares increased 4.7% to 744p in late morning trading on Friday after the professional services group announced an 8% to 10% revenue growth in HY1 2022, in line with management guidance.

The company highlighted an underlying EBITDA margin of 33% to 38%, with margin progression compared to HY1 2021 as JTC mitigated the impact of cost inflation.

JTC confirmed cash conversion within the guidance range of 85% to 90%, resulting in a leverage reduction of 0.7 times in the financial term and bringing it within guidance of 1.5 to 2 times underlying EBITDA.

In addition, organic growth was driven by record new business wins of £12.6 million, representing a 22% climb against £10.3 million year-on-year.

The group also noted a new business pipeline of £52.2 million at the close of HY1 2022, with an especially strong performance in June giving the company good momentum going forward in HY2.

“In the first half of 2022 we have built upon the strong performance delivered in 2021,” said JTC CEO Nigel Le Quesne.

“The business continues to demonstrate its resilience and agility during a period of macro uncertainty and our record new business wins reflect our ability to attract new clients and provide additional services to existing clients as they navigate both the threats and opportunities presented by the wider markets.”

The firm’s inorganic growth highlights included the smooth integration of its seven businesses acquired in FY 2021 into the JTC Global Platform, with its M&A pipeline remaining active with a selection of small-to-medium size opportunities currently in progress.

JTC commented its targets spanned the Institutional Clients Services Division, alongside the Private Client Services Division, with a special focus on the high-growth US market.

The company said it was confident in delivering FY 2022 results in line with market expectations, and reiterated its medium-term guidance.

“All integration programmes for the businesses we acquired in 2021 are on track and we maintain a healthy pipeline of targets in a consolidating sector,” said Le Quesne.

“We look forward to capitalising on our momentum in the second half of the year and, as always, my thanks go to the outstanding global team of JTC employee-owners, who continue to deliver service excellence for our clients and drive the Group forwards.”

Homeserve trading in line with expectations, £4bn Bidco acquisition on track

Natasha Doris
-
0
Homeserve trading in line with expectations, £4bn Bidco acquisition on track

Homeserve shares were flat in late morning trading on Friday following a report of trading in line with management expectations in the group’s latest trading statement.

The home insurance firm highlighted good business progress in North America and EMEA, along with high policy retention rates and strong maintenance in customer service levels.

Homeserve confirmed the continued execution of its HVAC buy and build strategy across its established territories, with Q1 achieving acquisitions across North America, France, Spain and the UK.

The company said its Home Experts business saw its number of trades exceed 47,000 despite a moderation in customer demand, on the back of Checkatrade’s tiered subscription packages as trade retention continued to improve.

The firm also highlighted its Court Meeting and General Meeting scheduled for later today to seek shareholder approval for the recommended cash offer by Bidco to acquire the entire issued and to be issued share capital of Homeserve for approximately £4 billion.

The transaction is expected to close in Q4 of calendar FY 2022, with Brookfield and Homeserve reportedly making progress on the submission of all regulatory and competition notifications and pre-notifications to complete the agreement.

Beazley announces best HY ratio since 2015 despite falling profits

Natasha Doris
-
0
Beazley announces best HY ratio since 2015 despite falling profits

Beazley shares gained 8.2% to 516.5p in early morning trading on Friday after the company reported its best HY ratio combined since 2015 of 87% as a result of high underwriting performance.

However, Beazley announced a pre-tax profit decrease to $22.3 million for HY1 2022, compared to $167.3 million in HY1 2021, on the back of investment losses of $193 million across the financial term.

The insurance firm highlighted a 1% return on equity against 15% year-on-year, alongside a 26% gross premiums written increase to $2.5 million from $2 million supported by a buoyant rating environment, with a premium rate change of 18% seen on average across the company.

Beazley confirmed a rate increase on renewal portfolio of 18% against 20% in the previous year.

The group also noted prior year reserve releases of $92.6 million compared to $95.7 million, along with a reserve surplus at 5.9% above actuarial estimates from 6.6%.

“We have maintained the momentum of the second half of 2021 with gross premiums increasing by 26% alongside better than expected claims experience,” said Beazley CEO Adrian Cox.

“A challenging investment environment has impacted profit; however I’m delighted that we have achieved our best combined ratio at a half year since 2015.”

Underwriting team structure

Beazley reported several changes to its underwriting team structure, with four new underwriting divisions created.

The new sectors include cyber risks, led by Paul Bantick, MAP risks, headed by Tim Turner, property risks under the guidance of Richard Montminy, and specialty risks under the management of Bethany Greenwood.

Beazley commented the divisions would be interconnected to operate at scale with the goal of delivering innovation and generating efficiencies to benefit the firm’s clients and brokers.

The group also set up a new digital division under the leadership of Ian Fantozzi, consolidating all the digital business written across Beazley into one segment.

FY 2022 guidance

Beazley commented it would continued to deliver in line with its goals for the remainder of 2022 and beyond, with an expected FY combined ratio in the high 80s, assuming an average claims experience for HY2.

“We continue to manage actively for inflation and recession and our estimate for the war in Ukraine remains unchanged,” said Cox.

“Given the positive experience in the first half of this year we are in a position to update our combined ratio guidance to high 80s for 2022 assuming average claims experience for the second half of the year.”

CMA approves BT Group & Warner Bros sports joint-venture

Natasha Doris
-
0
CMA approves BT Group & Warner Bros sports joint-venture

BT Group shares rose 0.3% to 181.6p in early morning trading on Friday, after BT Group announced the Competitions and Markets Authority (CMA) had approved a joint-venture between the company and Warner Bros to create a new sports offering for the UK and Ireland.

The approval is set to allow BT and Warner Bros to complete the formation of the joint-venture over the next several weeks, and for each company to transfer their assets into the new group.

The operation will join BT Sport and Eurosport UK, providing the joint-venture with one of the most expansive portfolios of sports rights across the UK and Ireland market.

“It’s great news that the CMA has approved the new JV that we are forming with Warner Bros. Discovery, combining the very best of BT Sport and Eurosport UK, to create an exciting new offer for live sport programming in the UK,” said BT Consumer Division CEO Marc Allera.

“Today is a huge milestone, as we now look toward day one of the new business, which we hope to be in the coming weeks.” 

BT Group added that BT Sport and Eurosport will initially retain their separate brands and product propositions in the market, before the companies are joined together under a single brand in the coming months.

“Combining the capabilities, portfolios and scale of BT Sport and Eurosport UK will be a big win for fans in the UK & Ireland, offering a new destination that will feature all the sport they love in one place,” said Warner Bros Discovery Sports Europe managing director Andrew Georgiou.

“We now look forward to closing the transaction and having the opportunity to further engage all stakeholders in the process of forming and developing the JV.”

BT Group confirmed the board of directors of the joint-venture would be equally represented between the executives of BT Group and Warner Bros, with Marc Allera nominated as the first appointed chairperson by shareholders on a rotating basis, and Andrew Georgiou selected as the new management and delivery leader.

AIM movers: Tough consumer conditions for Brand Architekts and eve Sleep, plus ex-dividends

Andrew Hore
-
0
AIM movers: Tough consumer conditions for Brand Architekts and eve Sleep, plus ex-dividends

Beauty brands supplier Brand Architekts (LON: BAR) expects an 11% decline in 2021-22 revenues to £14.2m – even with a one month contribution of £800,000 from Innovaderma. The group is loss-making, although there should be cost savings to come from integrating Innovaderma. Net cash is £11.3m. The share price dived 19.1% to 46.5p.

Mattresses retailer eve Sleep (LON: EVE) slumped 13.5% to 0.8p as sales decreased by 17% in the first half. Management says the market fell by 30%. France is holding up better than the UK. Trading is improving, though. There was cash of £1.5m at the end of June 2022 and eve Sleep had drawn down £900,000 of working capital facilities. A small number of expressions of interest in the company are undertaking due diligence.

Credit provider Morses Club (LON: MCL) has fallen a further 8.9% to 4.69p after yesterday’s announcement that the increasing level of customer redress claims means that it is considering a scheme of arrangement.

The merger between Tern (LON: TERN) and Pires Investments (LON: PIRI) is not going ahead because not enough of the latter’s shareholders voted for it. Tern has risen 5.8% to 11.9p, while Pires Investments has fallen 6.3% to 4.1p. Tern wants to generate cash from exiting one or more of its investments as soon as it is feasible. There will not be any new investments until there is a realisation of an investment, although there are likely to be commitments to existing investments that may mean a fundraising will be required.

There is further share price recovery for floorcoverings and tiles manufacturer Victoria (LON: VCP) following Tuesday’s full year results. The share price fell from 440p to 404p on the day, but it has recovered to 481p, up 13.2% today. Victoria is acquisitive, but it also generates organic growth. All parts of the business generated like-for-like growth, including the new US distribution business. That growth is continuing in the first quarter of the new year. Net debt was £406.6m at the end of March 2022, but cash generated from operations will help to finance further acquisitions.

Newcrest Mining can pay $60m to Greatland Gold (LON: GGP) to take up an option to acquire a further 5% stake in the Havieron project. Given the progress that has been made on the project over the past year this is an attractive price, and it is likely to take up the option. The cash will pay off the $50m loan facility from Newcrest and leave money for further investment. Greatland Gold will still own 25% of Havieron. The share price rose 7.5% to 10.8p.

Xtract Resources (LON: XTR) says that the first gold has been poured at the Fair Bride gold asset in Mozambique. The share price rose 15.6% to 3.9p.

Ex-dividends

Hercules Site Services (LON: HERC) is paying an interim dividend of 0.6p a share and the share price is unchanged at 47p.

Volex (LON: VLX) is paying a final dividend of 2.4p a share and the share price rose 4p to 308p.

M Winkworth (LON: WINK) is paying a dividend of 2.7p a share and the share price is unchanged at 172.5p.

Fonix Mobile expects revenue growth in FY 2023 and beyond on business pipeline

Natasha Doris
-
0
Fonix Mobile expects revenue growth in FY 2023 and beyond on business pipeline

Fonix Mobile shares rose 4.5% to 159.9p in late afternoon trading on Thursday on the back of a 16.5% revenue growth to £13.2 million in FY 2022 compared to £11.3 million in FY 2021.

The company announced a 16.3% increase in adjusted EBITA to £10.3 million against £8.8 million in the previous year.

Fonix Mobile further noted revenue and profit growth in line with management expectations, along with continued generation of strong underlying cash flows.

The telecommunications group reported total payment volumes of mobile payments climbed 11% year-on-year to £258.6 million compared to £233.4 million, including a record £35 million in payments over a single month.

The company highlighted continued customer growth across all sectors, with 123 active customers by the end of the year, representing a net increase of 11% from 111 active customers the last year.

It also launched interactive services with an unnamed broadcaster in the Republic of Ireland in the last few weeks of the financial term, contracting the firm directly with all major mobile operators in Ireland, with several clients scheduled to go live in FY 2023.

Fonix Mobile confirmed its three business segments of payments, messaging and managed services each expanded by at least 14% in FY 2022, with the group holding a “robust” pipeline of prospects going into FY 2023.

The firm announced an expected rise in revenue in FY 2023 and beyond, particularly in newly established international markets.

“We’re hugely proud of our progress over the last year, successfully launching services in new territories and continuing to achieve record levels of profitability,” said Fonix Mobile CEO Rob Weisz.

“We’re particularly delighted with the progress made in the Republic of Ireland to date and whilst a relatively small market, it provides us with an exciting blueprint for establishing a solid international strategy to expand into other new markets.”

“Our key business segments have each grown strongly throughout the year and we have continued to optimise margins further, focusing on growth in more profitable product offerings.”

Intelligent Ultrasound Group revenues climb 60% on strong UK stimulation sales

Natasha Doris
-
0
Intelligent Ultrasound Group revenues climb 60% on strong UK stimulation sales

Intelligent Ultrasound Group shares fell 2% to 14.2p in late afternoon trading on Thursday following a reported 60% anticipated revenue climb to £5.6 million in HY1 2022 compared to £3.6 million in HY1 2021 as a result of strong performance in UK stimulation sales.

The firm commented its stimulation related revenues from its direct sales team across the UK and US were expected to have grown by over 80% to £5.1 million against £2.8 million the year before.

Intelligent Ultrasound Group attributed its strong sales to a high number of one-off orders from an NHS training initiative in Q1.

Meanwhile, sales from the company’s reseller network fell due to the Chinese market closing on the back of Covid-19 restrictions, with revenue from the rest of the world projected to decline by 37% to £500,000 compared to £800,000 the last year.

Intelligent Ultrasound Group said its clinical AI products remained in the early stages of commercialisation, with HY revenue of £300,000 expected to be recognised against £100,000 in HY1 2021.

The group announced on 20 July that GE Healthcare had incorporated its ScanNav real-time AI technology into its new Voluson Expert 22 ultrasound machine, marking the second machine in the Voluson portfolio to incorporate the ScanNav AI software as an option add-on.

The company highlighted that with ScanNav Anatomy Peripheral Nerve Block expected to receive FDA clearance in HY2 2022 and a handheld edition of NeedleTrainer scheduled for launch in September, AI revenue is projected to continue growth in HY2 2022 and FY 2023.

Intelligent Ultrasound Group confirmed cash at bank of £3.5 million on 30 June 2022, against £5 million on 31 December 2021.

“This has been an excellent start to the year. Our simulation products have performed well in the UK and sales of the new clinical AI product range are starting to grow,” said Intelligent Ultrasound Group CEO Stuart Gall.

“The recent announcement that our ScanNav Assist software has now been incorporated on GE Healthcare’s new Voluson Expert 22 ultrasound machine is particularly encouraging.”

“We remain confident that we can meet the market expectations of £10m revenue for FY2022 and build a successful ‘Classroom to Clinic’ ultrasound business in this exciting sector of the market.”

1...628629630...1,764Page 629 of 1,764