SDCL invests in Baseload Capital and Turntide

Natasha Doris
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SDCL invests in Baseload Capital and Turntide

SDCL shares gained 0.8% to 119.2p in late morning trading on Monday, after the energy trust reported a series of investments by its investment group SEEIT in Baseload Capital and Turntide in North America and Europe.

SEEIT announced a deal to finance a portfolio of geothermal projects owned by Baseload Capital Sweden through a €25 million senior debt facility, with a $10 million investment in the upcoming Series C round of financing for California-based sustainable technology company Turntide.

The firm also completed follow-on investments into its existing projects in support of the roll-out of new sites and further funding for construction.

SEEIT has reportedly invested £19 million into Onyx, Sparkfund, Tallaght, EVN and Biotown since 31 March 2022.

Baseload Capital

The company commented that its Baseload Capital investment would finance the capex of existing and pipeline projects, with an initial anticipated draw down of €6 million at closing to re-finance a slate of assets both operational and currently in development.

Baseload Capital operates small-scale geothermal projects which utilise geothermal and waste heat resources at a lower temperature and shallower depth than conventional geothermal ventures, which reduces costs.

The geothermal firm is currently developing projects in Iceland, Japan, the US and Taiwan, with its current portfolio based in Iceland, the US and Japan.

“Baseload Capital provides heat and power generated locally from geothermal sources and is a great example of high efficiency renewable district energy generation,” said SEEIT fund manager Purvi Sapre.

“Our investment generates income straight away and, as such, contributes to meeting both SEEIT’s yield and total return targets.”

Turntide

Turntide and SEEIT have reportedly signed a Term Sheet concerning the financing of a $100 million financing facility, which is set to see SEEIT finance the capex of future qualifying energy efficiency projects developed by Turntide, so the group can consequently deliver infrastructure as a service.

The firm currently manufactures energy-efficient motor systems that don’t require the use of rare earth minerals.

Turntide’s client base resides in the US, Canada, the UK and continental Europe, with the inclusion of several investment grade multinational companies.

SEEIT added that the financial agreement with Turntide aligned with its investment policy as part of its allocation of 3% of gross asset value to developers and operators of energy efficiency projects, on the basis of Turntide’s energy efficiency characteristics.

“SEEIT’s two new investments with Baseload Capital and Turntide will further diversify the portfolio by technology, industry and geography while also providing key infrastructure services in global efforts to achieve net zero,” said SDCL CEO Jonathan Maxwell.

“Turntide has the ability to achieve a significant reduction in global electricity consumption wasted by legacy electric motors in commercial buildings, agriculture and transport.”

“It is also well positioned to play an important role in the electrification of transport. SDCL considers the relationship with Turntide as an exciting long-term partnership and we look forward to working with them on many new projects in the coming years.”

Moonpig to acquire Buyagift for £124m

Natasha Doris
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Moonpig to acquire Buyagift for £124m

Moonpig shares were up 10.6% to 260p in early morning trading on Monday, following the bespoke card company’s proposal to acquire experience provider Buyagift for £124 million.

Moonpig commented that the acquisition would unlock the growing £6 billion UK gift experiences market, alongside its potential to leverage the firm’s bespoke gifting expertise to deliver highly relevant gift recommendations across a wide range of products.

The special occasion firm said it aimed to become the “ultimate gifting companion” with the proposed deal.

The company highlighted Buyagift’s impressive financial track record, including its 3.3 million customers across the group’s Buyagift and Red Letter Days brands, along with consistent double-digit revenue growth on compound annual growth rate over the last ten years, with an aim to grow to mid-teens over the medium term.

https://twitter.com/Independent/status/1528662673499557888

The card firm also drew attention to the company’s strong financial model, which reportedly boasted consistent revenue growth, high margins and robust cash generation.

Moonpig noted the cash consideration of £124 million against an unaudited FY 2022 EBITDA of £14 million for the firm, with a proposed 100% cash funded agreement through cash on balance sheet and a committed extension to Buyagift’s senior revolving credit facilities.

Moonpig further mentioned an adjusted EPS accretion over 20% in the first year of the acquisition, with an ROIC above WACC in the third year, alongside a net debt to adjusted EBITDA below 200% by April 2023.

“The proposed acquisition of Buyagift rapidly accelerates Moonpig Group’s journey to become the ultimate gifting companion,” said Moonpig CEO Nickyl Raithatha.

“There is strong strategic rationale for the transaction, and compelling financial benefits. Buyagift is profitable and highly cash generative, with a proven track record of strong growth and we are excited by the ways that we can further transform the business using the Group’s proven playbook.”

“We see significant potential for the cross-selling of gifting experiences to Moonpig Group’s loyal customers. We look forward to working with the Buyagift team to deliver an enhanced proposition for our customers and to create value for our shareholders.”

Kainos revenues grew 29% in FY 2022 to £302.6m

Natasha Doris
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Kainos revenues grew 29% in FY 2022 to £302.6m

Kainos shares were up 17.1% to 1,208.5p in early morning trading on Monday after the company reported a 29% increase in revenue to £302.6 million from £234.7 million over the last year, representing the group’s twelfth consecutive year of growth.

The IT firm announced an adjusted pre-tax profit growth of 3% to £58.8 million compared to £57.1 million, along with a statutory pre-tax profit fall of 9% to £46 million against £50.3 million.

Kainos highlighted a 35% growth in bookings to £349.8 million from £258.8 million year-on-year, and a period-end cash level of £76.6 million compared to £80.9 million, with cash conversion at 83% compared to 112% in 2021.

Revenue in the company’s digital services grew 24% to £199.8 million against £161.6 million, with a 45% rise in Workday Services revenue to £70.9 million compared to £49 million and a 32% uptick in Smart Test and Smart Audit product revenues to £31.9 against £24.2 million.

Meanwhile, the software group reported a customer approval rating of 98%, which remained flat year-on-year, alongside a 34% growth in customer figures to 731 compared to 546 the previous year.

“Our latest business results outline the consistency of our long-term performance, as we recorded our twelfth consecutive year of growth – in terms of people, customers, revenue and profitability,” said Kainos CEO Brendan Mooney.

“Over those twelve years, we have helped organisations drive their digital transformation programmes and realise their ambitions. That digitalisation trend gathered further pace during the pandemic as our customers responded to the changing ways of delivering essential services to citizens, patients, customers, and employees.” 

“Looking forward, we remain confident in our business as the demand for our services has never been higher, our reputation for delivery continues to flourish, while the scale and capability of our organisation continues to grow at pace.”

Kainos confirmed an adjusted diluted EPS rise of 4% to 38.1p from 36.8p and a total dividend per share drop of 21% to 22.2p compared to 28.2p.

Kingfisher LFL sales increase 16.2% compared to pre-Covid rates

Natasha Doris
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Kingfisher LFL sales increase 16.2% compared to pre-Covid rates

Kingfisher shares increased 2.3% to 252p in early morning trading on Monday following a reported 16.2% growth in like-for-like sales compared to pre-Covid-19 levels in its Q1 2022 trading update.

The DIY group confirmed sales in line with executive expectations of £3.2 billion for the term, however, like-for-like sales fell 5.4% and total sales in constant currency dropped 4.2%.

Kingfisher highlighted resilient demand in its DIY and DIFM/trade sectors, and noted that it continued to manage inflationary pressures moving into Q2 2022-2023.

The home-improvement company added that omni-channel engagement remained at a high rate, with a three-year e-commerce sales increase of 164%, reflecting 16% of group sales compared to a 7% coverage year-on-year.

“Kingfisher has delivered a good first quarter of trading, with LFL sales 16.2% ahead of our pre-pandemic performance,” said Kingfisher CEO Thierry Garnier.

“While facing very strong comparatives in the prior year, our continued strategic progress has enabled us to retain a significant proportion of the increased sales during the pandemic.”

B&Q and Screwfix

However, Kingfisher said its B&Q sales slid 17.8% in total, and dropped 18.3% in like-for-like sales due to the impact of storms in February, with like-for-like sales in weather-related categories falling 28% against the same period last year.

The firm commented that its Screwfix brand sales fell 7% overall, and slid 10.9% on a like-for-like basis. However, Kingfisher drew attention to its 13 Screwfix store openings in Q1 over the UK and Ireland, with an extra 80 stores set to open across the countries for the remainder of the financial year, alongside the launch of its first Screwfix stores in France in HY2 2022-2023.

Meanwhile, the store franchise saw a 59% increase in its Poland sales, with a 54.5% rise on a like-for-like basis, with strong performance across all categories and the launch of one big-box store over the term.

“Looking forward, we are reiterating our profit guidance for FY 22/23. We are focused on delivering on our strategic objectives and growth initiatives, including the growth of our scalable e-commerce marketplace, the expansion of Screwfix in the UK and France, new store openings in Poland, further increasing our trade customer base,” said Garnier.

FY 2022-2023

The firm reiterated its FY2022-2023 guidance with an estimated pre-tax profit of £770 million.

Kingfisher said it estimated broadly flat central costs year-on-year, alongside a capital expenditure gross capex target of 3.5% its total sales, which amounted to £397 million for FY 2021-2022.

The group confirmed that its priority remained top line growth and to target additional share gains in its market as it centred its focus on strategic objectives and investments for growth.

Kingfisher also noted a further £300 million of surplus capital through its share buyback programme after its closed £145 million shares repurchase in April, and confirmed the first tranche was scheduled to commence soon.

The company noted that its dividend policy target cover range was 2.25 to 2.75 times, based on adjusted basic earnings per share.

Chariot raises cash for Morocco gas project

Andrew Hore
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Chariot raises cash for Morocco gas project

Chariot Ltd (LON: CHAR) has raised £20.4m ($25.5m) at 18p a share and that should provide enough money to push forward with the Anchois gas development in Morocco and the renewables projects that are in process. There will be additional cash to come from an open offer.
An upgrade in net gas pay estimates for the Anchois-2 well pushed up the Chariot share price, enabling management to take advantage and raise this cash. The share price is at its highest level since 2018.
Management wants to move the Anchois forward as fast as possible so that cash can be generated from the initial well. A long-...

Restore acquisition prospects

Andrew Hore
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Restore acquisition prospects

Records management, technology and office relocation services provider Restore (LON: RST) is trading in line with expectations and it has flagged a strong pipeline of potential acquisitions.
In the four months to April 2022, revenues were 37% ahead, which included organic growth of 14%. That organic growth has particularly come from the digital and information management business. Increased office activity has led to a recovery in shredding business Datashred.
Restore is having to managing higher than expected cost increases but it has managed to offset these by raising prices and improving ef...

Next Fifteen’s surprise Saatchi bid

Andrew Hore
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0
Next Fifteen’s surprise Saatchi bid

Marketing services firm Next Fifteen Communications (LON:NFC) is making a recommended bid for fellow AIM-quoted advertising agency M&C Saatchi (LON: SAA) and rival bidder AdvancedAdvT (LON: ADVT) says that it will not increase its offer.
Saatchi has rejected the AdvancedAdvT bid. Next Fifteen is offering 0.1637 of one of its shares and 40p in cash for each Saatchi share. At a Next Fifteen share price of 1266p, the bid was valued at 247.2p a share. The share price has increased to 1294p, which makes the bid worth around 252p a share.
At an AdvancedAdvT share price of 87p, the all share bid ...

Alien Metals boasts multiple opportunities for value creation

UK Investor Magazine
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Alien Metals boasts multiple opportunities for value creation

Alien Metals is diversified metals explorer with projects across Australia, Mexico, and Greenland. Their broad portfolio of assets hold deposits of iron ore, platinum group metals (PGE), palladium, gold, copper and Zinc.

The nature of their portfolio means the company not only has exposure to battery metals and the growth in demand for EVs and renewable energy, but also the safe haven characteristics of gold, and silver’s manufacturing applications.

The Alien has recently acquiring the remaining stake in what is thought to be one of Australia’s largest platinum group metals (PGE) deposits and has enjoyed bumper results from scoping studies at the Hamersley Iron Ore project.

Having such a broad range of asset means there are plentiful opportunities to de-risk the portfolio and Alien may start to see revenue from production in the not too distant future.

Alien Metals is undertaking a series of concurrent studies across their portfolio of assets and promises a steady flow of market updates throughout 2022.

Alien Metals currently has a market cap of £28m which one may argue doesn’t fairly reflect the strength of their portfolio of assets, when compared to other junior miners of a similar valuation. Indeed, analysts at WH Ireland gave Alien Metals a 2.7p price target in April.

Alien Metals in Australia

In March 2022 Alien Metals deepened their exposure in Australia with the acquisition of 100% interest in Munni Munni Platinum Group Metals and Gold Project in the West Pilbara, Western Australia. The Munni Munni project is held in high esteem and thought to be one of the most significant PGE resources in Australia.

The Munni Munni non-JORC resource points to 24Mt @ 2.9g/t Platinum Group Element (PGE) and gold for 2.2Moz PGM3. In term’s of PGEs, Munni Munni includes 1.14Moz of palladium, 0.83Moz of platinum, 152koz gold and 76koz of rhodium. 

This resource was revealed using the now non-compliant 2004 JORC standards, so one of the first jobs at Munni Munni will be to conduct a JORC 2012 compliant study.

Iron ore

Australia is also home to the Hamersley Iron Ore asset that borders licences held by Fortescue Metals Group, Hancock Prospecting, BHP Billiton, Hope Downs and Brockman Mining.

A recent study found the project to hold 10m/t of “high-quality product with very little adverse deleterious minerals’. The costs associated with bringing the asset into production are also highly attractive. Hamersley benefits from low capital requirements aided by adequate infrastructure and access to the Port Hedland Public Ore Terminal.

The ability to employ surface mining techniques helped to achieve low estimates of $60 per tonne Free on Board costs for Alien’s iron ore offtake. Spot prices for Dalian 62%-grade iron ore have been having around $130 per tonne.

Bill Brodie Good, Alien Metals CEO, said they were working to ‘get this project into production within a very short timeframe.’

Elizabeth Hill

The high-grade Elizabeth Hill Silver Project has ben undergoing evaluation and recently received the final results from the 15 RC drill holes that included 8m @ 4,233 g/t Ag (149oz/t Ag) in one drill hole and 2m @ 1,550 g/t Ag (55oz/t Ag) in another.

The campaign also revealed encouraging assay results for copper, cobalt, lead and zinc.

Mexico

Alien Metal’s Mexican assets focus on silver with the Los Campos and San Celso projects. In addition, Alien is set to begin a drill campaign at Donovan Copper/Gold project.

Los Campos and San Celso projects are located in areas that have seen significant levels of past silver mining activity and San Celso is home to two historic silver mines.

Los Campos Project

The Los Campos project is located in Mexico’s largest silver-producing region and holds two high grade epithermal silver veins that were previously found to have grades of 14g/t Au Equivalent.

Greenland

Alien Metals obtained a license to begin exploration in Greenland in a 208 km2 exploration area in the close vicinity of what is thought to be one of the largest lead/zinc deposits in Greenland.

The Citronen zinc-lead project owned by Ironbark Zinc Limited has a JORC Resources of 131.1 m/t @ 4.5% Zn + Pb.

The Alien Metals share price was 0.61p at the time of writing.

FTSE 100 recovers as retail sales grow 1.4%

Natasha Doris
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0
FTSE 100 recovers as retail sales grow 1.4%

The FTSE 100 closed at 7,387.8 on Friday, after the index recovered on a positive slate of results from the Office of National Statistics (ONS), which reported that UK retail sales grew 1.4% in April despite a crushing 9% rate of inflation.

Non-store and online retailers experienced a 3.7% surge as a result of stronger clothing sales, which might serve to assuage investor fears over retail group stocks, which have seen dramatic falls in light of inflation fears over the last few months.

“Clothing sales have been more resilient than expected, according to the new ONS data. Boohoo and ASOS both enjoyed a share price jump on the news as investors were taken aback by the sales trends,” said AJ Bell investment director Russ Mould.

“Recent months have seen shares decline in both companies as the market feared casual spending on tops, dresses and shirts would fall given that buying fewer non-essential clothes would be an easy way to save a bit of money now needed to pay for gas and electricity.”

The index appears to be one of the stronger markets to weather the economic storm, as the FTSE 100 was dragged back up from its gloomy Thursday depths.

“Investors may feel as if they’ve been soaked by a torrential shower given the state of the markets this year. Look closer and it’s clear that the FTSE 100 is the one with the best umbrella,” said Mould.

Royal Mail shares gained 3.8% to 311.5p after its shaky results on Thursday, which reported some positives, including a 0.6% rise in revenue to £12.7 billion compared to £12.6 billion the last year.

The company announced a doubled dividend payout, with a full-year payment of 20p per share against 10p year-on-year.

Meanwhile, investor moods were further lifted as Chinese measures to lift the struggling economy rolled in, with the Hang Seng rising 3% as China’s central bank announced a reduction in a key lending rate.

Insurance giant Prudential, which shifted its focus to Asia in 2021, benefited from the recovering Chinese market, with shares in the group closing 2.5% higher at 1,000p.

The rally in China also pulled a range of miners up the FTSE 100, with Croda closing 2.3% higher at 6,706p, Anglo American gaining 1.7% to 3,526p, Rio Tinto increasing 2% to 5,454p, Endeavor up 1.4% to 1,844p and Fresnillo rising 1.1% to 783p.

“Boring old commodity producers, utility providers and tobacco stocks have come to the UK market’s rescue, proving that successful investing is not all about backing the next big go-go growth stock,” said Mould.

Venture capital needs women for female-led businesses to thrive

Natasha Doris
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Venture capital needs women for female-led businesses to thrive

Female representation in venture capital investment is crucial for female-led businesses to thrive, according to a recent report from Slip founder Tash Grossman.

The retail technology app CEO said increased female representation in the venture capital sector was the key to unlocking the potential of businesses started by women, and to narrowing the gap between male and female-founded companies.

The survey found that for every dollar invested in female-led start-ups, twice that amount of revenue was invested in male start-ups, which Grossman linked to a lack of women in venture capital positions.

According to the report, female business founders were three-times more likely to receive funding from venture capital companies headed by women. However, women currently make up a mere 13% of senior leadership roles in the industry, with many firms discovered to have zero women on their investment teams.

“Around the world, venture capital has always seemed like a ‘boys’ club’ and as we look to the future, investors need to show that they are willing to adapt if we are to encourage the creation of more female-founded businesses and reap the economic rewards of this,” said Grossman.

Grossman’s Slip app recently gained £750,000 in a fundraise supported by a slate of female investors, including Dr Pamela Walker, who pointed out the emerging body of research in support of the impact gender and racial diversity have as a major driver of financial performance in companies across the international spectrum.

“From my perspective as an investor, I believe everyone should have equal access to capital and diverse teams are able to think both critically and creatively with an instinct to align, decide, and act quickly which in turn helps them to become more successful,” said Walker.

“Diversification is a core tenet of investment. Having a diverse portfolio means targeting more diverse markets with a different lens and unlocking access to innovation.”

“Investors that pull this mindset through to funding will out-perform the rest.”

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