Ashtead looks to Canada and US rental markets as UK demand subsides

Natasha Doris
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Ashtead looks to Canada and US rental markets as UK demand subsides

Ashtead shares were down 1% to 3,762p in early morning trading on Tuesday after a reported 19% revenue growth to $8 billion, reflecting a 22% climb in rental revenue and growth across all regions.

The company commented that the revenue increase fed into a 38% rise in underlying pre-tax profit to $1.8 million, which was helped by saving efforts, despite higher levels of activity bringing back some previous costs.

Ashtead mentioned an estimated rental revenue rise of 12% to 14% in the coming year, with growth in the US and Canada projected to offset a decline in the UK as pandemic-related medical demand subsides.

“We’re pleased to see Ashtead’s been making hay while the sun shines. But the real progress has been growth in the group’s end markets,” said Hargreaves Lansdown equity analyst Laura Hoy.

“As demand from the healthcare sector starts to wane, Ashtead’s growing position in the US should continue to drive sales in the year ahead.”

The firm reportedly spent $414 million on share buybacks in the year, and announced a 67c final dividend, bringing the total dividend for the term to 80c.

“The group’s had to open its wallet to fund the expansion, but a the balance sheet remains in reasonably strong condition,” said Hoy.

“That’s despite $414m spent on share repurchases this year. Although the group’s approved further buybacks this year, management is unlikely to keep up with this level of repurchases given the pressing need for increased investment in the business.”

“For now all appears to be well at Ashtead, and the inflationary environment’s done little to dull the shine. However with a recession still a very real concern in the group’s largest markets, construction spending could start to shrink which would undo much of this progress.”

OnTheMarket revenue climbs 32% to £30.4m on higher number of paying customers

Natasha Doris
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0
OnTheMarket revenue climbs 32% to £30.4m on higher number of paying customers

OnTheMarket shares were flat at 86.4p in early morning trading on Tuesday after the company announced a revenue climb of 32% to £30.4 million in FY 2022 against £23 million in FY 2021.

Revenue grew on the back of a higher number of paying customers, the migration of customers on discounted rates towards full-tariff contracts, maintained growth in new homes revenues, and Covid-19 customer support discounts that amounted to £2.6 million in 2021.

OnTheMarket reported an adjusted operating profit rise of 13% to £2.7 million compared to £2.4 million, on the back of an 80% climb in marketing investment to £10.6 million against £5.9 million in FY 2021, along with an operating loss of £600,000 from an operating profit of £1.2 million in the last year.

The property portal firm also highlighted a post-tax profit of £100,000 following a profit of £2.7 million in FY 2021.

The group noted a drop in year-end cash of 21% to £8.4 million compared to £10.7 million, in part linked to its investment in Glanty Limited since its acquisition, and full furlough scheme repayment over the term, representing together an estimated £2.6 million in cash payments.

OnTheMarket highlighted mostly flat average advertisers listed at 13,732 against 13,285 year-on-year, alongside an 8% uptick in total advertisers at 31 January 2022 to 13,732 from 12,687.

The company also confirmed a slight boost in traffic of 6% to 283 million visits against 267 million in the previous year.

Guidance FY 2023

OnTheMarket commented that its trading had kicked off to a strong start in FY 2023, with UK residential property markets remaining active and property demand significantly outweighing supply.

The company said its board believed the firm’s recent operational and financial progress, along with its loyal advertiser base, provided a good platform for the implementation of its strategy.

“I am delighted to be reporting a strong set of results which show that our strategy is working. Having listened and engaged with thousands of agents we are more convinced than ever in our strategy of building a differentiated, tech-enabled property business,” said OnTheMarket CEO Jason Tebb.

“With our strong performance and momentum in the business the future remains very exciting for OnTheMarket. We are continuing to deliver increased value to our customers and serious property seekers, with innovative new products and a refreshed brand.”

“I would like to thank the OnTheMarket team for their hard work and commitment to delivering for all of our stakeholders.”

Go-Ahead recommends consortium bid

Andrew Hore
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Go-Ahead recommends consortium bid

Go-Ahead (LON: GOG) is recommending a bid from a consortium of Kinetic TCo and Globalvia Inversiones that values the bus and rail operator at £647.7m.

The consortium is offering 1450p a share in cash and there will also be a special dividend of 50p a share instead of a final dividend for the year to 2 July 2022. The consortium originally offered 975p a share back in January.

The share price has been much higher than the offer price, but not since early 2020. The all time high back in 2007 was nearly double the bid level.

Kinetic is the largest bus operator in Australia and New Zealand. Globalviamanages transport infrastructure concessions, including highways and railways. It already operates in Spain, the US, Ireland, Portugal, Costa Rica and Chile.

Go-Ahead has bus operations in the UK, Singapore, Ireland and Sweden, plus rail franchises in the UK, Germany and Norway.

Rival

There is a rival, and it is unclear if it will put in a bid for Go-Ahead. Earlier in the day, Go-Ahead management said that there were two bidders that it had allowed to undertake due diligence. The other was Kelsian Group Ltd, which was previously known as SeaLink Travel Group.

ASX-listed Kelsian (ASX: KLS) is Australia’s largest land and marine transport business and it also has operations in the UK and Singapore.

The Go-Ahead board said that the revised proposal from Kelsian was at a level where they would “would be minded to recommend” a firm proposal. It is unclear whether this offer was higher or lower than the recommended bid, but presumably the recommendation would not have been made if a firm offer was at a higher price.

Palm oil price rise partly offsets lower production at Dekel Agri-Vision

Andrew Hore
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Palm oil price rise partly offsets lower production at Dekel Agri-Vision

A bumper crude palm oil price is good news for palm oil plantations operators. Cote d’Ivoire-based Dekel Agri-Vision (LON: DKL) has not been producing as much as the previous year, but this is offset by the higher price.
Dekel increased crude palm oil sales by 276% to 4,025 tonnes in May 2022, compared to the previous May. That includes delayed sales from April, and there was a year-on-year reduction in production when April and May figures are combined.
Although the amount of fruit processed was much lower extraction rates improved from 20.8% to 23.5% over the year. The average palm oil price...

B.P. Marsh announces total shareholder return of £17.6m, raises FY 2022 dividend

Natasha Doris
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B.P. Marsh announces total shareholder return of £17.6m, raises FY 2022 dividend

B.P. Marsh shares were up 1.7% to 297p in late afternoon trading on Monday, after the group reported a total shareholder return of £17.6 million for its FY 2022.

The firm highlighted a NAV increase of £16.7 million to £166.6 million from £149.9 million, representing an 11% growth.

B.P. Marsh further mentioned a NAV per share climb of 46.3p in 462.7p compared to 416.4p in the last year.

The company announced a consolidated post-tax profit of £17.5 million against £13.7 million the year before, alongside an equity portfolio valuation uptick of 14.7% compared to 10.9%.

B.P. Marsh drew attention to its three disposals across the year of Walsingham for £5.2 million, MB for £3.6 million and Mark Edwards Partners for £1.1 million.

The firm completed a further disposal after the end of the year for Summa, which was valued at £9.6 million.

“The Group has delivered another strong set of results, against a difficult macro-economic environment, namely Covid-19,” said B.P. Marsh chairman Brian Marsh.

“The Group continues to demonstrate the effectiveness of its investment criteria, and following a number of successful disposals, will be looking for more high-quality investment opportunities to bolster an already high performing portfolio.”

The company warned investors about inflationary headwinds, but reportedly remained confident it could accomplish growth in the coming year ahead.

“There remain headwinds for all businesses, particularly the conflict in Ukraine and the inflationary environment, but I remain confident that working closely with our portfolio companies we can continue our growth trajectory and deliver for our investors.”

B.P. Marsh proposed a dividend of 2.7p per share, which is scheduled for payment in July 2022, representing a 14% raise from its dividend of 2.4p year-on-year.

Distil turnover falls 19% to £2.9m, raises £3.2m to invest in Ardgowan Distillery Company

Natasha Doris
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Distil turnover falls 19% to £2.9m, raises £3.2m to invest in Ardgowan Distillery Company

Distil shares dropped 3.8% to 1.3p in late afternoon trading on Monday, following a reported turnover fall of 19% to £2.9 million against £3.6 million in the previous year.

The drinks producer confirmed a 19% slide in gross profit to £1.6 million in FY 2022 compared to £2 million in FY 2021, alongside a broadly flat rate of margins at 55.4% from 55.6% year-on-year.

Distil highlighted a decline in advertising and promotional spend of 17% to £890,000 compared to £1 million, and an adjusted administrative expenses climb of 15% to £746,000 from £651,000.

The company also noted an adjusted EBITDA of £9,000 against £303,000, and an operating loss of £132,000 from an operating profit of £254,000 in the last year.

Distil mentioned a successful equity fundraise of £3.2 million before expenses to invest in Ardgowan Distillery Company Limited, with an initial advance of £2.8 million made to the firm.

The drinks group also highlighted its appointment of Michael Keiller as non-executive director in its high points for the financial year.

“Distil brands continued to perform well in a volatile market recovering post-Covid. The reopening and return of consumer confidence in the hospitality sector has contributed to growth in-line with our forecasts pre-pandemic,” said Distil executive chairman Don Goulding.

“Continued challenges to costs have accelerated the consolidation of our production, which has allowed us to benefit from greater efficiencies and economies of scale.”

“In addition, we are building our sales and marketing departments internally to allow us to react quickly to market challenges, increase our distribution footprint and drive marketing reach.”

Proton Motor Power Systems order intake falls to £2.8m in FY 2021

Natasha Doris
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0
Proton Motor Power Systems order intake falls to £2.8m in FY 2021

Proton Motor Power Systems shares were down 3.6% to 10p in early afternoon trading on Monday, after the group reported a dramatic fall in total order intake to £2,800,000 in FY 2021 against £7,300,000 in FY 2020.

The company announced that 49% of its order intake was derived from its stationary segment, compared to 76% the last year, with other orders spread across its mobile, maritime, rail and engineering segments.

Proton Motor Power Systems mentioned several notable orders over the year, including multiple orders from GKN Hydrogen for its S8 Fuel System, an agreement with Torqeedo GmbH for its Marine sector, and a memorandum of understanding signed with Electra Commercial Vehicles Limited to operate as a system integrator to integrate Proton Motor fuel cells into the Electra truck portfolio, followed by an initial order.

The group noted sales of £2,771,000 against £1,893,000 the year before, representing an annual climb of 46%.

The firm reported a gross profit of £425,000 from £83,000 year-on-year, with an operating loss of £9,121,000 against £7,128,000 in FY 2020, which reportedly fell in line with the company’s budgeted expectations.

According to the group, its widened loss was on the back of additional investment in the technical development sector, in support staff to the firm, and infrastructure-related costs.

Proton Motor Power Systems commented that its outlook would focus on ramping up its production capacity, progressing its group technology offer and exploiting the current potential sales pipeline, with the current outlook for FY 2022 looking more optimistic than FY 2021.

“Although faced with highly challenging trading conditions in 2021, the Company has made significant progress,” said Proton Motor Power Systems CEO Dr. Nahab.

“In the year ahead, we are focused on further progressing the maturity of the Group’s technology offer, ramping up production capacity and exploiting the current potential order intake and sales pipeline.”

“Furthermore, it is anticipated that the significant strengthening of political commitment to hydrogen, as evident in 2021, will contribute to further accentuating the demand for hydrogen related products, such as the fuel cell.”

FTSE 100 falls as global markets struggle ahead of key central bank decisions

Natasha Doris
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0
FTSE 100 falls as global markets struggle ahead of key central bank decisions

The FTSE 100 fell on Monday amidst a global equity selloff following a 0.3% contraction in UK GDP reported by the ONS today, and ahead of key central bank meetings this week.

The UK markets were faring slightly better than other international markets, however the difference was credited to slide in the Sterling rather than any market strength.

“Once again in 2022 the FTSE 100 is doing a smidge better than other global markets but, before UK investors get too excited, a big slide in sterling is a significant contributing factor to the outperformance,” said AJ Bell investment director Russ Mould.

Meanwhile, markets across the globe continued to slide after US inflation hit a 40-year record of 8.6% in May and all but confirmed a hawkish US Federal Reserve move on interest rates at its next meeting.

The NASDAQ dropped 3.5% to 11,340, the NYSE was down 2.4% to 15,096.6, the French CAC decreased 2.1% to 6051.9 and the German DAX fell 2% to 13,479.9.

“The hangover from a higher than expected US inflation reading is continuing to cause scissoring pain throughout the markets, as it extinguishes the hope the US Federal Reserve might be able to take its foot off the pedal on interest rate rises,” said Russ Mould.

“The mood out there is pretty grim, with the relief rally seen in late May starting to feel like a distant memory,” said Mould.

Risk off trade

Gold miner Fresnillo was one of the only stocks to experience a boost in the market, with a 5.1% gain to 786.7p as investors flocked to safe havens.

“You know things are bad when the best performer among the UK’s top stocks is precious metal producer Fresnillo as investors reach for traditional safe havens,” said Mould.

Industrial metals stocks took a nosedive, as China went back into lockdown shortly after announcing its end as cases kicked off again last week.

Mining groups saw their shares dip as fears sparked over a slowed rate of production in the factory of the global economy, with Glencore dropping 5.3% to 477.9p, Antofagasta falling 4.9% to 1,362p, Anglo American sliding 4.4% to 3,455p and Rio Tinto losing 3.2% to 5,504p.

The Hang Seng declined 3.3% to 21,067.5 and Scottish Mortgage Investment Trust suffered a hit of 4.3% to 3,455p as a result of its shares in Asia-focused companies including Alibaba and Tencent tumbling on the back of China’s lockdowns, along with sharper interest rate fears from the US Federal Reserve.

With interest rates predicted to rise from the Fed on Wednesday, and the Bank of England expected to hike its interest rates an additional 0.25% to 1.25%, companies are feeling the pressure of being between a rock and a hard place in expenses and a drop off in consumer demand.

“Investors are likely to remain jittery at least until the Fed has delivers its verdict on rates on Wednesday, with the Bank of England following suit a day later,” said Mould.

Crypocurrency crash

Bitcoin and Ether fell 10% and 13% respectively as Cryptocurrencies fell in line with global equities.

‘’As inflation proves to be an even trickier opponent to beat than expected, Bitcoin and Ether are continuing to get a severe bruising in the ring. They are prime victims of the flight away from risky assets as investors fret about spiralling consumer prices around the world,” said Susannah Streeter, analyst at Hargreaves Lansdown.

Power Metal Resources to carry out further investigation at Selta Project

Natasha Doris
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0
Power Metal Resources to carry out further investigation at Selta Project

Power Metal Resources announced an update for its lithium-focused exploration at the Selta project in Northern Territory, Australia today.

The project, which is currently held by Power Metal Resources’ 82.7%-owned subsidiary First Development Resources, was subject to a lithium-specific review based initially on further desktop analysis, following on from a recent in-depth data review covering the operation.

The company commented that the review specifically focused on the potential of pegmatite geology across the Selta project, and its capacity to host lithium mineralisation.

The mining firm said the desktop work included a review of lithium-specific publicly available data, with a review of satellite imagery and hyperspectral analysis to find high-priority targets for additional field investigation.

According to Power Metal Resources, its multi-layered approach to the target definition process has so far identified several hundred coincident anomalies, which are potentially indicative of pegmatite geology.

The company added that 65 initial primary and secondary targets had been singled out for more in-depth investigation.

First Development Resources have assembled a field investigation team which is scheduled to arrive on-site in the coming days to conduct mapping and surface sampling of the prospective targets identified.

“During our recent site visit to the Northern Territory, pegmatite style outcrop was observed within the Selta Project area, further adding weight to the findings from the original in-depth review of the Project,” said First Development Resources CEO Tristan Pottas.

“Given the potential for lithium mineralisation, we commissioned a remote sensing study to look at the pegmatite specific potential and following the identification of 65 prospective targets we have expedited a field-based work programme to test whether the identified targets host lithium bearing mineralisation.”

Tekmar seeks partner, Scirocco and Wentworth deal, N4 Pharma Nuvec progress

Andrew Hore
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Tekmar seeks partner, Scirocco and Wentworth deal, N4 Pharma Nuvec progress

Subsea cable protection services provider Tekmar Group (LON: TGP) is seeking a strategic partner or bidder because it believes that its weakened balance sheet will not enable it to turnaround the company and take advantage of opportunities, particularly in the wind power sector. The share price slumped 12.5p to 26.5p. In February, a placing and open offer raised £4.1m at 45p. Five years ago Tekmar joined AIM at a placing price of 135p. Interim revenues fell from £13.9m to £13m and it remains loss making. The order book has improved from £9.7m to £20.1m over the six months to March 2022. Net cash was £4.6m but losses and higher working capital requirements will reduce that figure.  

Scirocco Energy (LON: SCIR) is selling is 25% non-operated interest in the Ruvuma gas project in Tanzania to Wentworth Resources (LON: WEN). It appears to be a good del for both of them with Scirocco Energy up 0.05p to 0.475p and Wentworth Resources 1p higher at 26p. The project is next door to Wentworth’s Mnazi Bay gas project and makes Wentworth a significant player in Tanzania. Wentworth will pay $3m on completion, $3m when there is a final investment decision for the project and up to $8m from a share of net profit from Wentworth’s working interest. A further $2m will be paid when gross cumulative production reaches 50Bcf. Wentworth Energy has the cash to fund the deal and continue to increase the dividend. Scirocco Energy can concentrate on its anaerobic generation joint venture and other sustainable energy investments.

Positive data from studies using Nuvec has boosted the N4 Pharma (LON: N4P) share price has risen 0.25p to 2.8p. Nuvec is a delivery mechanism that pharma companies can use to get the antigens they have developed into cells to express the required protein. A study shows tumour suppression, and the company is trying to analyse whether the treatment went directly to the tumour or whether it was via other organs. Nuvec has also been successfully loaded with SiRNA and this could extend its use. A long-term study on oral applications has produced promising early data.

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