Aquis weekly movers: Valereum continues rise
Valereum (LON: VLRM) shares continued to rise after last week’s announcement that it intends to launch a global open marketplace platform for Non-Fungible tokens (NFTs) and the commercial review of the business plans for the Gibraltar Stock Exchange. The share price rose 18.8% to 28.5p (27p/30p). There is regular trading in the shares.
Mark Horrocks has increased his stake in Quetzal Capital (LON: QTZ) from below 3% to 5.3%. The share price jumped 15.5% to 3.35p (3.2p/3.5p).
Energy storage technology developer Invinity Energy Services (LON: IES) share rose 14% to 53p (51p/55p) ahead of the publishing of 2021 results on 27 June.
Shares in brewer Daniel Thwaites (LON: THW) rose following the previous week’s full year results to March 2022. Revenues recovered from £32.2m to £96m and it also returned to profit. A loss of £12.4m was turned into a pre-tax profit of £12.7m. The pension deficit has become a pension asset worth £10.1m and a final dividend of 2.2p a share is recommended. The shares rose 9% to 106p (104p/108p).
Shares in clean energy supplier Good Energy (LON: GOOD) rose 3.81% to 272.5p (265p/280p) in the week of its AGM. There was a pre-AGM investor presentation. Resolutions 8-12 were not passed, which were mainly enabling the company to issue new shares or buy back existing shares. Resolution 12 would have amended the articles of association to permit hybrid meetings.
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Fallers
Shares in Yooma Wellness Inc (LON: YOOM) slumped by one-quarter to 4.5p (4p/5p), making it the worst Aquis performer last week. There was one deal during the week with 47,777 shares traded at 3p each, although there were no new announcements.
Pluto Digital has repaid the loan, plus interest, of £5.18m owed to NFT Investments (LON: NFT). Weak cryptocurrencies are hitting the shares. The price fell 19.6% to 1.025p (1p/1.05p).
Wishbone Gold (LON: WSBN) says that drilling at the Halo project in north Queensland has discovered copper mineralisation in the majority of holes drilled. The 21 hole is apparently the most promising. There was a 16.7% fall in the share price to 10p (9.5p/10.5p).
All Star Minerals (LON: ASMO) is raising £200,000 at 0.02p a share and every two shares come with a warrant to subscribe for a share at 0.04p. The share price slipped 10.9% to 0.0245p (0.025p/0.026p). The cash will be used to finance investment in the company’s exploration projects. A further share issue at 0.02p pays the £102,000 owed to GMI, where the All Star Minerals chief executive is a substantial shareholder. Management says that it is planning a much bigger cash raise. OvalX has been appointed as broker.
Cadence Minerals (LON: KDNC) reported an outflow of cash from operating activities of £751,000 in 2021, down from £1.36m the previous year. The company, which is also quoted on AIM, has agreed to sell its 30% working interest in the Yangibana project tenements for £5.1m in shares of the ASX-listed operator Hastings Technology Metals. The share price fell 4.23% to 10.75p (10.5p/11p). Blockchain and cryptocurrency investor Coinsilium Group Ltd (LON: COIN) increased 2021 revenues by 130% to £530,000. Net fair value loss on financial assets was £407,000, compared with a gain of £566,000, but realised gains increased from £199,000 to £1.52m. Overall pre-tax profit fell from £310,000 to £14,000. There is £1.51m in the bank at the end of 2021, while NAV is £5.84m. Coinsilium has entered a simple agreement for future tokens (SAFT) with potential Latin America- focused blockchain gaming hub GGs.io for $100,000 of its future tokens and is a strategic adviser. There was a 1.42% fall in the share price to 2.77p (2.74p/2.8p).
AIM weekly movers: 4D Pharma, Kinovo, Naked Wine, Corcel, Tasty, Engage XR, Actual Experience
Gas and electrical maintenance services provider Kinovo (LON:
KINO) was the best performing AIM share last week although there was no
additional information about the guarantees and £3.7m of working capital support
provided to DCB Kent, which was sold at the beginning of the year. DCB has been
placed in administration The acquirer MCG Global is claiming money from Kinovo.
The share price was 41.2% higher at 12p, but that is not much more than
one-third of the level in early May.
Restaurants operator Tasty (LON: TAST) has repaid its
£1.1m bank loan, leaving it with net cash of £8.6m. The share price jumped
31.2% to 5.05p. That values the company at £7.1m. Annualised interest rate
savings will be £57,000 and there was no early repayment penalty. There are plans
to open five or six more restaurants this year.
Virtual reality software developer Engage XR (LON: EXR) announced
two partners for its enterprise focused Metaverse, ENGAGE Link. This boosted
the share price by 28.6% to 13.5p. The partners are HITC, which will be in the
enterprise plaza of the platform, and The Vitual Human Interaction Lab at
Stanford University, which is in the education plaza. ENGAGE Link should launch
in the fourth quarter of 2022.
Argentina-focused oil and gas company Phoenix Global
Resources (LON: PGR) says that it is in discussions with 84% shareholder Mercuria
Energy Group concerning a cancellation of its AIM quotation and a cash offer to
purchase shares from independent shareholders at 7.5p each. The share price has
risen 25.4% to 6.3p. Five years ago the share price was ten times that level.
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Fallers
Last week Actual Experience (LON: ACT) shares had a
chance to react to news of the loss of a contract that was published late on
the previous Friday. The share price more than halved to 3.5p. The analytics services
provider to digital businesses says that due to a change in requirements a channel
partner has terminated the contract that generated £200,000 out of group
revenues of £1.74m in 2020-21.
Online wine retailer Naked Wine (LON: WINE) reported
a profit in the year to March 2022, but it is likely to make a loss this year. The
share price slumped 47.9% to 152.2p. Customer retention is declining, although
it remains at 80%, and it is taking longer to achieve the payback of investment
in acquiring new customers. There are fears that consumers seeking to save
money may end their subscription to Naked Wine.
Shares in 4D Pharma (LON: DDDD) declined 28.5% to 16.66p
before trading was suspended on Friday. 4d Pharma subsequently revealed that Oxford
Finance has demanded immediate repayment of the $13.86m it is owed. The company
cannot do this, so administrators have been appointed.
Corcel (LON: CRCL) shares fell 35.7% to 0.675p after
it said that it was not going ahead with the Avonmouth 50MW gas peaking project
near Bristol. There is progress being made with the Wowo Gap nickel/cobalt project
in Papua New Guinea.
Engineer and consultancy TP Group (LON: TPG) has
delayed the publication of its 2021 results and AIM regulation is extending the
allowed reporting period to the end of September. There is work to be done on onerous
fixed price contracts in the maritime division and there will be provisions.
There are attempts to renegotiate contracts. The share price fell by 34% to 1.65p.
FTSE 100 claws back ground as consumer confidence hits record low
The FTSE 100 closed up by 2.6% at 7,208.8 on Friday, clawing back ground in a turbulent week for the markets.
Markets have contended with soaring inflation and the prospect of a central bank induced recession in the first half half of 2022 and UK stocks have provided investors with a dismal performance.
“As we approach the halfway point for 2022, investors continue to cross their fingers that markets will have a better second-half than the first six months of the year,” said AJ Bell investment director Russ Mould.
“Only 59 socks in the FTSE 350 index are currently sitting on share price gains year-to-date.”
“It’s when you dig into the data for the fallers that the scope of the market sell-off is laid bare. More than 100 stocks in the index have seen their share price fall by 30% or more, including some names which up to this year had been market darlings.”
Surprisingly, retail stocks performed strongly despite consumer confidence hitting a record low of minus-40 points according to the Growth from Knowledge (GfK) survey. JD Sports Fashion shares gained 4.2% to 119.1p and Next shares rose 1.7% to 5,982p.
Clothing stood out as one of the few categories gaining in the latest retail sales report, with consumer spending up 2.2% last month.
Food sales dropped by 1.6% in May, however the results failed to slow supermarket stocks. Tesco shares increased 3.5% to 255.4p, B&M shares gained 2.1% to 385.4p, Sainsbury’s shares rose 3% to 210.8p and Ocado shares saw an uptick of 1.7% to 870.6p.
Barclays
Barclays shares jumped 3.1% to 158.9p after the banking group confirmed its intended acquisition of specialist mortgage-lender Kensington Mortgage Company for £2.3 billion.
The company mentioned the purchase would allow it to broaden its product offering across the UK mortgage market, grow its client volumes and expand mortgage originations in order to optimise its UK funding base.
“The Transaction reinforces our commitment to the UK residential mortgage market and presents an exciting opportunity to broaden our product range and capabilities,” said Barclays Banks UK CEO Matt Hammerstein.
“The Transaction should generate attractive returns for Barclays over the medium term as the KMC Mortgage Portfolio increases in size through the ongoing origination of new mortgages.”
“We look forward to KMC management and employees becoming part of the Barclays group.”
Conservatives lose two seats to Lib Dems and Labour as calls for PM resignation grow
The Conservative party lost two seats in the by-election today, losing the Tiverton and Honiton seat to the Liberal Democrat party and the Wakefield seat to Labour.
The defeat comes hot on the heels of Prime Minister Boris Johnson’s latest wave of scandal, with the Tories still working to stamp out the flames from ‘partygate.’
Adding to Johnson’s strained party morale, Conservative chair Oliver Dowden handed in his resignation earlier today, serving to throw additional fuel on the fire.
“We cannot carry on with business as usual … Somebody must take responsibility and I have concluded that, in these circumstances, it would not be right for me to remain in office,” wrote Dowden.
The loss of the Conservative seats follows a vote of confidence against Johnson earlier in June, where his own party split down the middle in a bid to kick him out of his leadership role.
The verdict saw him maintain his position, however 148 members of the Tory party voted to have him evicted, with his supporters growing ever thinner.
The Tiverton and Honiton seat was won with a 30% swing on the back of former MP Neil Parish quitting after he was discovered watching adult videos in Parliament.
The votes beat a Conservative majority of 24,239, the highest number ever overturned in a by-election on record.
The Tories lost the Wakefield seat to Labour in a 12.7% swing, gaining victory by 4,925 votes.
The win marks the party’s first by-election victory over the Conservatives since 2012, with the result coming in as Labour’s best intake for Wakefield since 2001 and its best result ever on those boundaries.
Greencoat Renewables to acquire Ersträsk North Wind Farm
Greencoat Renewables shares were up 0.8% to 1.1p in late afternoon trading on Friday after the firm announced its scheduled acquisition of the 134.4MW Ersträsk North Wind Farm in Norrbotten County, Sweden.
The company is set to acquire the wind farm from Enercon on a forward sale basis. The wind farm is currently under construction and is scheduled for commissioning in Q4 2023.
Greencoat Renewables reported it would provide long-term operations and maintenance services once the energy site was operational.
Ersträsk North is set to initially operate as a merchant asset, however it will have the flexibility to contract the electricity produced through a corporate PPA.
The wind farm represents the firm’s second acquisition in the region after its purchase of Ersträsk South wind farm in October 2021.
The acquisition of Ersträsk North will bring Greencoat Renewable’s total capacity in the sector to 235 MW.
“We are delighted to partner with Enercon and agree to acquire the Ersträsk North windfarm,” said Greencoat Renewable Capital partner Paul O’Donnell.
“Sweden is becoming a major hub for green energy, with the combination of low-cost generation and a number of attractive routes to market.”
“As the renewable generation market continues to develop, we expect to see greater opportunity in the unsubsidised renewables market and believe Greencoat Renewables is well positioned to benefit both across mainland Europe and in Ireland.”
Trackwise shares fall as FY 2022 revenue expected to disappoint market
Trackwise Designs shares were down 17.3% to 50p in late afternoon trading on Friday after the company announced its revenue for FY 2022 was expected to come below market expectations on the back of reduced near-term UK electric vehicle (EV) OEM customer demand.
Trackwise Designs reported a projected adjusted operating profit and pre-tax profit in line with management expectations.
The specialist printed circuit technology products firm highlighted an IHT sales pipeline with 95 clients and opportunities, concentrated in its primary target markets of EVs, medical and aerospace, with a selection of EV opportunities including tier one and tier two supplier options for a number of major OEMs.
The group confirmed a total order book for delivery for £4.6 million in FY 2022, of which the IHT order book was £2.5 million and the APCB order book was £2.1 million.
The company mentioned a total revenue of £3.3 million in the five months to 31 May 2022, including five month IHT revenue of £500,000.
Trackwise Designs noted cash of £3.2 million received in June relating to asset financing for capital equipment currently on site and commissioned at its Stonehouse facility.
The firm said its Stonehouse facility was in the middle of completion and commission work, housing the high-volume, low mix, roll to roll IHT production facility.
The operational setup is set to significantly increase the company’s production capacity to meet expected demand for IHT across its target markets with an initial priority on EVs.
Empire Metals widens loss on expanded Australia prospects
Empire Metals shares were down 1.7% to 1.2p in early afternoon trading on Friday after the group reported a widened pre-tax operating loss of £2.3 million from £953,769 in FY 2021.
The company announced an administration expenses loss of £1.9 million compared to £958,694 the last year, along with other losses at $417,138 against an intake of £3,721.
Empire Metals confirmed a total loss for the year of £589,254, representing a slight rise from £572,989 in the previous year.
The mining firm commented it had undertaken significant expansion of its exploration footprint across highly prospective areas of its target jurisdiction in Australia.
The company also appointed Shaun Bunn as managing director to advance rapid expansion strategy in Australia, along with the appointment of two exploration professionals, Ed Baltis as an exploration consultant and Louisa Stokes as an exploration geologist.
Empire Metals executed a drilling and exploration programme at its Eclipse Gold project, with a completed 4,589 metres reverse circulation drilling programme over 44 holes in February 2021, including an intercept of 24 metres at 1.4 g/t gold near Jack’s Dream old workings.
The group also mentioned its acquisition of the Gindalbie Gold project post-period end, alongside its concluded Definitive and Binding Sale and Purchase Agreement over the Bolnisi project in Georgia for $3.3 million in June 2021.
Empire Metals further noted its oversubscribed placing which raised £1.7 million post-period end, resulting in a cash at bank of £2.7 million to support exploration programmes across 2022 and 2023.
“This has been a pivotal year for Empire and it has been an incredibly exciting time to be part of the team. I had the pleasure of joining Empire at the key turning point in its strategy as it intensified its exploration focus on Australia, an area which I know well and has, quite rightly, been continuously hailed as the world’s leading mining jurisdiction,” said Empire Metals CEO Shaun Bunn.
“With Eclipse forming the initial stepping stone to establishing an Australian exploration portfolio of quality and scale, we have seen some very encouraging results from drilling and technical work undertaken in 2021, further increasing our confidence that our focus within Australia is well placed.”
“This has been clearly put into action with the decision to bolster our position at Eclipse post period end, through the Tribute Agreement in respect to the neighbouring Gindalbie Project, and thus forming the now renamed Eclipse-Gindalbie Project to create real scale in the region.”
Consumer confidence nosedives as recession alarm sounds
Consumer confidence hit a record low after dropping two points to minus-40 points in May, according Growth from Knowledge (GfK).
The GfK Consumer Confidence Barometer recorded its lowest score since records began in 1974, exceeding reports from the heights of the 2008 financial crash at minus-39 points, along with the effects of Brexit and the Covid-19 pandemic.
The report follows the lowest unemployment rate in 50 years, alongside 40-year record high inflation of 9.1% driven by skyrocketing food and fuel costs.
GfK confirmed consumer pessimism was strongest in depressed sub-measures on the general economy at minus-63 for the past year and minus-56 for the coming year.
In addition, the Major Purchase Index slid consecutively month-on-month for the last six months and is currently at minus-35 as a result of gloomy retail sales reports.
However, the sub-index for personal financial situation over the next 12 months rose by one point to minus-25.
Retail sales drop
The news comes in light of the latest retail sales volumes, which dropped by 0.5% in May after a 0.4% rise in April.
The Office of National Statistics (ONS) announced a 1.3% fall in sales volumes in the past three months against the three months before, continuing the downward trend from summer 2021.
The organisation reported the slide in sales volumes was linked to reduced spending in food stores, which fell by 1.6% on the back of rising food prices and the devastating cost of living crisis.
“The latest retail sales figures won’t tell anybody anything they don’t already know, but they do provide an interesting snapshot into how consumers are wrestling with inflation,” said AJ Bell financial analyst Danni Hewson.
“Quite simply they’re buying less of pretty much everything, from food to furniture. At supermarket checkouts people are setting limits, own brands are replacing big name favourites and shoppers are trading down in the hopes of getting a little more for a little less.”
Fuel costs
Vehicle fuel sales further rose by 1.1% as more employees moved back to the office in hybrid work schedules.
“Then there’s another hike in fuel sales. The price at the pump might trigger mild palpitations every time motorists fill up, but businesses have been pushing hard to get more people back in the office,” said Hewson.
“Hybrid working is undoubtedly here to stay and fuel sales haven’t returned to pre-covid levels, but they have been slowly creeping back up.”
“It will be interesting to see how recent train strikes, which have forced many people back to their kitchen tables, will impact the trend.”
Fashion stays in business
Meanwhile, non-food store sales remained flat and clothing sales grew by 2.2%, which was offset by a 2.3% fall in household goods such as furniture and department stores.
“There are a couple of notable exceptions. Those people who are managing to get away on holiday are updating their summer wardrobes— for many it’s been a couple of years since they’ve needed beach wear and the lipstick effect is very much in evidence,” said Hewson.
“Cutting back is hard work, it’s demoralising, so spending a little on something that makes you feel better about yourself, particularly when it’s combined with a much longed for vacation seems like a no-brainer.”
“And with a glut of postponed events clogging up the calendar, there will be a few people needing to adjust for lockdown habits.”
The ONS confirmed a slide in online retail sales to 26.6% from 27.1%, however sales remained significantly higher than the 19.7% rate in February 2020 before the Covid-19 pandemic.
“Consumers have also been spending less online, but habits have changed and even people who weren’t comfortable shopping from their sofas have been won over and will still reach for their tablets if life gets in the way of them hitting the high street,” said Hewson.
Overcast outlook on horizon
However, consumers have definitely started to take the rising cost of living into account, and the clock is ticking down the days until customers draw a line in the sand and cut back spending on the less essential retail products in life.
“But it is rising prices that will be troubling retailers the most as they look beyond the summer months and towards that crucial golden period,” said Hewson.
“Budgets don’t stretch, a pound can only be spent once and people are having to make tough choices.”