B&M on track to hit FY 2023 guidance, revenues slide in Q1

Natasha Doris
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B&M on track to hit FY 2023 guidance, revenues slide in Q1

B&M shares were up 0.8% to 382.9p in early morning trading on Wednesday after the company announced it was on track to hit its FY 2023 EBITDA of £550 million to £600 million in the firm’s Q1 trading update.

B&M announced a 2.2% fall in group revenue on a constant currency basis across the term of £1.16 billion from £1.18 billion, however it pointed out an improving trend over the quarter.

The company reported core B&M UK fascia one-year like-for-like revenue decreased 9.1% for the period.

However, due to exceptionally high sales in April 2021, the firm broke its trading into two separate blocks, with the five week trading period of April 2022 recording a like-for-like revenue slide of 19.1% and the eight week trading throughout May and June noting a like-for-like revenue decline of 1.6%.

B&M said its Herron Foods business performed well across the term, exceeding management expectations with a year-on-year revenue of £113 million against £102 million.

The discounter confirmed its French sector produced strong like-for-like revenue growth with particularly promising returns from its gardening and leisure sectors. The French branch announced a Q1 2023 revenue of £91 million compared to £68 million in Q1 2022.

B&M also launched its online trial in the UK with 1,000 SKUs available for home delivery to customers.

The company announced 1,125 stores across the business against 1,097 the last year, with B&M UK climbing to 705 from 684, France growing to 109 outlets from 105 and Heron Foods rising to 311 compared to 308.

Appreciate Group (App) Finals: A platform to grow

Jon Levinson
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Appreciate Group (App) Finals: A platform to grow

Appreciate Group (App) have improved 4% to 29p which is a Mkt Cap: £54m after reporting finals to March ’22. Both Division’s reported that profitability had recovered strongly for a combined profit of £8.4m from £2.3m.  Revenue increased 15.4% to £123.3m with the corporate division particularly strong. Appreciate is a leading multi-retailer redemption provider for  gifting, pre-payment, and customer loyalty engagement company. It owns a range of marketing brands, designed to connect customers to its products and services at a ‘special price’ for Consumers and Corporate.&nbs...

Mediazest revenue grows to £1.4m as projects recommence post-Covid

Natasha Doris
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Mediazest revenue grows to £1.4m as projects recommence post-Covid

Mediazest shares fell 7.1% to 0.07p in late afternoon trading on Tuesday following a 66% growth in revenue to £1.4 million compared to £846,000 in HY1 2022 as a result of easing Covid-19 restrictions and client projects recommencing.

The firm reported a gross profit increase of 84% to £756,000 compared to £410,000, along with a gross margin rise of 54% against 48% the last year.

Mediazest mentioned a climb in administrative expenses of 35% to £618,000 from £459,000 the year before linked to the furlough scheme ending and staff returning to the office as hybrid working kicked off.

The company announced a EBITDA of £138,000 against a loss of £49,000 year-on-year, alongside a net post-tax profit of £40,000 compared to a loss of £160,000 in the previous year.

The group noted cash and cash equivalents of £46,000 from £16,000 as of 31 March 2022.

Mediazest highlighted a strong outlook for FY 2022, with its long-term clients expanding the range and number of deployments with the firm and new opportunities emerging in Europe, with the board currently in the process of establishing an office in mainland Europe to better capitalise on new opportunities and facilitate project delivery post-Brexit.

The company confirmed strong recurring revenue streams, alongside the addition of new clients as it eyes potential acquisitions in a bid to unlock shareholder value.

Mediazest commented it remained aware of macroeconomic headwinds, however it reported strong demand across its sectors and estimated growth in FY 2022.

IG Design Group profits fall on cost inflation, eyes growth in FY 2023

Natasha Doris
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IG Design Group profits fall on cost inflation, eyes growth in FY 2023

IG Design Group shares soared 20% to 81.6p in late afternoon trading on Tuesday following a growth in revenue to $965.1 million in FY 2022 against $873.2 million in FY 2021.

IG Design Group attributed its revenue climb to strong demand for its products and focus on delivering customer commitments.

The company announced an adjusted pre-tax loss of $1.3 million compared to an adjusted pre-tax profit of $32.8 million, along with a reported pre-tax profit of $2.2 million from a reported pre-tax profit of $14.7 million in the previous year.

The firm highlighted supply chain and cost inflation issues as the main factor behind its drop in profits, alongside a lack of freight availability throughout the financial year.

IG Design Group mentioned a net cash at year end fall to $30.2 million from $76.5 million as a result of increased costs and working capital requirements.

The company noted that a recent banking covenant amendment to March 2023 and a facility extension to March 2024 had secured access to financing to support its working capital requirements.

The design company confirmed a strong order book for FY 2023, which is currently at 71% of budgeted revenues, indicating continued demand and positive customer relationships.

The firm added that it was passing on cost inflation to customers where possible, resulting in a minor operating margin improvement estimated for FY 2023.

The company also commented that higher financing costs were expected linked to revised banking facilities and a maintained higher working capital as the group looked to manage its higher cost environment heading into the next term.

“The extent of the impact of the inflation and supply chain challenges in FY2022 have given us cause to re-examine our business, and we are therefore laying out today a foundation for a strategy with a clear focus on restoring profitable and sustainable growth,” said IG Design Group interim executive chair Stewart Gilliland.

“While it will no doubt evolve further over the coming months, the Board and wider management team are fully aligned, focused on mitigating cost pressures and creating a more resilient business.”

“This will provide a stronger base on which we can build in the future.”

IG Design Group reported a dividend of 1.7c per share from 11.8c per share in FY 2022.

OptiBiotix revenues rise to £2.2m on Probiotics & Prebiotics success

Natasha Doris
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OptiBiotix revenues rise to £2.2m on Probiotics & Prebiotics success

OptiBiotix shares were up 0.8% to 20.6p in late afternoon trading on Tuesday following a reported 45.3% rise in revenue to £2.2 million against £1.5 million in FY 2021.

The firm announced a 27.7% increase in gross profit to £1.1 million from £879,000, alongside a climb in its Probiotic business sales of 34% to £1.1 million compared to £800,000 with a 92.6% spike in underlying profit sales year-on-year.

OptiBiotix confirmed its Prebiotics business sales grew 59.3% to £1.1 million against £600,000 the year before, with underlying sales rising by 122%.

The company mentioned both its Prebiotics and Probiotics sectors experienced profitable trading with EBITDAs of £13,000 and £179,000, respectively.

The group further noted a significant increase in the value of its holding in SkinBio therapeutics from £8.9 million to £13.7 million, resulting in a group net profit of £6.3 million compared to £5.8 million in the previous year.

OptiBiotix reported a total cash on balance sheet at the close of 2021 rise of 122% to £2 million from £900,000 year-on-year.

“With our products winning awards in several jurisdictions and an increasing number of large companies like The Hut Group, Holland and Barrett, AlfaSigma, Apollo Hospitals, and Nahdi Medical using our products, we are in strong position for further growth” said OptiBiotix CEO Stephen O’Hara.

“With no debt, a healthy balance sheet, a growing reputation within the industry, second-generation products close to commercialisation, and growing consumer interest in the microbiome and gut health, the Company is in a strong position for continued growth in this exciting area of healthcare.”

Coro Energy shares fall on $7.5m loss

Natasha Doris
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Coro Energy shares fall on $7.5m loss

Coro Energy shares were down 8.7% to 0.2p in early afternoon trading on Tuesday after the group announced a total loss of $7.5 million in FY 2021 against $11 million in FY 2020.

Coro Energy highlighted a pre-tax loss from continuing operations of $6.5 million from $8 million the year before, and an overall pre-tax loss of $1.6 million against $1.1 million.

The company reported a loss from discontinued operations of $1.5 million compared to $2.1 million last year, alongside a loss from operating activities of $3.5 million from $3 million year-on-year.

The energy firm noted a selection of highlights across the year, including its acquisition of an early stage South East Asian renewable energy portfolio with an initial focus on the Philippines as part of the group’s efforts to develop its green energy assets.

It also announced a new partnership in Vietnam with Vihn Phuc Energy to develop rooftop solar projects and initiated a 3 MW pilot including signing a 25-year Power Purchase Agreement for the pilot.

The company further raised net proceeds of approximately $5.5 million through a placing and open offer to fund the firm’s low carbon energy investments.

Coro Energy mentioned the relaunching of its producing Italian gas portfolio against the backdrop of recent structural changes in European gas prices, and highlighted its continued progress towards commercialising the Mako gas field in which it holds a 15% interest.

“Underpinned by its strong Italian production and four institutional lenders, Coro’s shareholders are exposed to a leveraged play on the oil price,” said Coro Energy chairman James Parsons.

“Our strategy remains to monetise the Duyung PSC, use the Italian cash flows, which more than covers the Company’s G&A costs, and invest selectively in South East Asian renewables and high graded Italian production enhancement opportunities.”

“Recent volatility in energy markets have presented huge opportunity to Coro with the re-birth of the Italian portfolio alongside a significant uplift in the core NAV of its position in the Duyung PSC. It is in this context that we are delighted to present our annual report and accounts to shareholders.”

Coro Energy did not declare a dividend for FY 2021, following its decision not to issue a dividend in FY 2020.

FTSE 100 rises 1% as miners soar on $600bn G7 fund

Natasha Doris
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FTSE 100 rises 1% as miners soar on $600bn G7 fund

The FTSE 100 was up over 1% in early afternoon trading on Tuesday as markets were pulled up by mining companies on hopes of growing future demand for raw materials.

The G7 $600 billion plan to fund infrastructure in developing countries over the next five years served to send commodities groups surging as investors leapt to the sector.

“Periods when the FTSE 100 rises in the region of 1% in a day should be celebrated given how this year has been so gloomy for investors. Today, the fireworks are most definitely lighting up the sky and the UK market is regaining its mojo,” said AJ Bell investment director Russ Mould.

“Miners revved their engines yesterday following the G7 $600 billion infrastructure plan and were striking more gold today as investors continue to flock to the sector.”

Anglo American shares gained 1.8% to 3,191.7p, Antofagasta rose 0.3% to 1,227.2p, Croda saw an uptick of 0.4% to 6,409p, Endeavor increased 1.4% to 1,770.5p, Glencore soared 2.7% to 465.1p and Rio Tinto climbed 3% to 5,202.5p.

The price of oil increased to $117 per barrel for benchmark Brent Crude, sending Shell and BP shares up 3.2% to 2,181p and 3% to 403.3p, respectively.

China eases Covid-19 restrictions

Meanwhile, China-focused stocks saw an uptick as the Chinese government eased Covid-19 quarantines to ten days rather than three weeks for visitors entering the country.

Asia-focused insurance company Prudential gained 3.4% to 1,044.2p and the Hang Seng increased 0.8% to 22,418.9.

The prospect of fewer disruptions to global production also served to boost US markets, with NASDAQ pre-market trading up 0.5% to 12,099.7 and the Dow Jones up 0.5% to 31,604.

“Perhaps helping the cause was news that China would reduce the Covid quarantine period for visitors from overseas, perhaps a sign that the Asian superpower’s extra tough pandemic measures might be relaxed going forward,” said Mould.

“That would help to alleviate fears that commodities demand would be weaker from China if it shut up shop every time a new Covid wave came.”

Utilities fall

Utilities dropped as JP Morgan downgraded Severn Trent, with the group’s shares falling 4.9% to 2,711.5p. The move triggered a dip in United Utilities shares, which dipped 1.2% to 1,021.7p.

“Utilities were out of fashion following a broker downgrade on Severn Trent,” said Mould.

“JPMorgan moved to an ‘underweight’ position on the stock, triggering a 4.2% decline in the share price. United Utilities fell in sympathy.”

The pathway to production and beyond with Alien Metals

UK Investor Magazine
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The pathway to production and beyond with Alien Metals

The UK Investor Magazine team was delighted to welcome Bill Brodie Good, CEO at Alien Metals, to the Podcast ahead of our Summer Investor Evening this week. Register for your spot here.

The Alien Metals CEO provides a comprehensive overview of the company and their key projects.

Bill starts by detailing their Mexican and Australian jurisdictions and what attracts him to operations in the countries.

We progress to Alien Metals’ individual projects. Alien Metals has a diverse portfolio of assets focused on PGMs, gold, silver, and iron ore. The Hancock iron ore has the potential to begin production next year which would provide significant cashflow to further grow Alien’s portfolio.

Bill outlines Alien’s strategy and business model, and how they are navigating the challenges created by today’s markets.

Bill Brodie Good will present at the UK Investor Magazine Summer Investor Evening. Register for your spot here.

AIM movers: WANdisco, Symphony Environmental, MS International, Jangada Mines

Andrew Hore
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AIM movers: WANdisco, Symphony Environmental, MS International, Jangada Mines

Data management and analysis software provider WANdisco (LON: WAND) has won its largest ever contract with a major telecoms company that is an existing client. The shares rose 10% to 296p. The agreement is valued at $11.6m – $5.8m in advance – and takes the total value of contracts with the customer to $14.3m. The software will be used to move smart meter data to multiple cloud providers. WANdisco remains heavily loss-making so the additional cash will be useful. Last year, the cash outflow from operating activities was $28.2m and there was $5.76m of capital investment. There was $27.8m in the bank at the end of 2021, with a further $19.8m raised at 270p a share earlier this month.

Investors have been excited by a deal that Symphony Environmental Technologies (LON: SYM) has made with North American bread supplier Grupo Bimbo. The potential for the deal pushed the share price up 17.2% to 18.75p. The supply deal for d2p antimicrobial technology for use in the production of bread bags is for an initial period of three years. The new bread bags are already being produced. This follows successful legal action in Peru to get the government to differentiate between Symphony’s ox-biodegradable products and oxo-degradable products, which leave behind microplastics.

Shares in MS International (LON: MSI) rose 8.3% to 300p after it announced a 12% increase in the total dividend to 9.25p a share. In the year to April 2022, the defence and engineering products supplier improved pre-tax profit from £1.59m to £5.97m. That included a £1.19m settlement for a contract dispute, although there were £600,000 of legal expenses in overheads.  

Jangada Mines (LON: JAN) warns that its Pitomberias vanadium project in Brazil could require more cash. This means that the 100%-owned project may not start production this year. A decision should be made on sourcing the funding within three to nine months. The project has an NPV8% of $96.5m. The share price slumped 23.7% to 3.55p. At the end of December 2021, Jangada Mines had £3.5m in the bank and since then $650,000 has been raised from the sale of ValOre shares.

Oil and gas explorer Providence Resources (LON: PVR) has regained all its share price decline after it announced a proposed fundraising at a 35% discount to the previous day’s closing price. Today, the share price is up 25% to 2.75p, having been as low as 1.8p last week. Providence is raising $1.8m at 1.5p a unit (one ordinary share and one warrant exercisable at 1.5p). The cash will be spent on working capital and fund Providence’s lease undertaking application for Barryroe, which is an offshore field south of Cork.

Bango (LON: BGO) has signed its second agreement in less than one week. Bango shares rose 10.9% to 159.75p. The latest is with Spanish language programming-focused US network TelevisaUnivision Inc, which is licensing the Bango payments platform for its OTT subscription service ViX+, which will be offered around the world. Last week’s agreement was with an unnamed multinational technology company, which will use the Bango platform for carrier billing and bundling services for app store payments and subscription services. Prior to that announcement, the share price was 126.5p.

Limited cash to take advantage of Oxford BioDynamics prospects

Andrew Hore
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Limited cash to take advantage of Oxford BioDynamics prospects

Precision medicine tests developer Oxford BioDynamics (LON: OBD) fell 14.7% to 13.225p following its interim figures announcement. The company has significant opportunities but limited funds.

The cash outflow after R&D tax credits was £2.3m in the six-month period. There is £4.6m of cash in the bank at the end of March 2022. That was after £3.62m was raised at 46.5p a share last October.

Last week, EpiSwitch CiRT was launched in the UK, having been launched in the US in February. This is precision medicine test that can predict whether a patient will respond to immune checkpoint inhibitor therapies – they are infective treatments for 70% of patients.

Costs will be saved by not prescribing ineffective medicine and doctors can be reassured that it is correct to prescribe treatments.

Oxford BioDynamics is still talking with major pharma companies about the test so it will take time for revenues to build up. Once a reimbursement code is obtained in the US it should be easier to assess the potential.

Oxford BioDynamics has other products. The next diagnostic is likely to be for prostate cancer.  EpiSwitch CiRT is the one that could be significant in the medium-term, though. The prospects are positive.

Investors may be concerned about the cash position and the likely need for a fundraising in the next year. Revenues are unlikely to build up fast enough to enable the company to take advantage of the opportunities. There were warrants with the recent placing, but they are exercisable at 58.125p.

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