CentralNic Group to acquire VGL Verlagsgesellschaft for €60m

Natasha Doris
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CentralNic Group to acquire VGL Verlagsgesellschaft for €60m

The CentralNic Group announced on Monday that it is set to acquire VGL Verlagsgesellschaft for a reported enterprise value of €60 million.

The CentralNic Group is reportedly expected to pay an initial consideration of €67 million upon its acquisition of the online marketing company from its present shareholders.

The acquisition is expected to increase the company’s pro forma revenue and EBITDA to $470.5 million and $57.9 million respectively for its results over the financial year in 2021.

VGL reportedly generated $55.3 million of revenue and US$10.9 million of Adjusted EBITDA from 31 December 2020 until 31 December 2021.

CentralNic further announced that it will be raising up to £42 million through a placing of an estimated 35 million new ordinary shares at the expense of 120p per share.

The Company is also set to provide all qualifying shareholders with the opportunity to subscribe for an aggregate of up to 2,500,000 Open Offer Shares.

The move has been announced in an effort to raise up to £3 million, on the basis of 1 Open Offer Share for every 100.46403360 existing ordinary share owned by the company shareholders at the record date.

“The acquisition of VGL is a natural extension of CentralNic’s online marketing business and a major step in adding content-based marketing solutions to its comprehensive suite of services,” said Ben Crawford, CEO of CentralNic.

“Millions of customers rely on the value-added content provided by VGL to make informed decisions when purchasing online, leading the world’s foremost e-commerce companies to use VGL for customer acquisition.”

Valentin Dushe, co-founder of VGL added: “We are very pleased to welcome CentralNic as our new shareholder and partner.”

“CentralNic is a highly experienced player in the market as well as the perfect fit for VGL Group, and will support us in executing our envisaged growth strategy on both a national and an international level.”

“We share the same vision and values and strongly believe that not only our users, but also the Company itself stand to significantly benefit from this new partnership.”

AIM-listed CentralNic share price saw a drop of over 6% on Monday morning as the company also released preliminary full year results which saw revenue for 2021 increase by 71% to $410.5m.

Nostra Terra Oil and Gas: Well Well Well!

Anshula Kumar
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Nostra Terra Oil and Gas: Well Well Well!

Nostra Terra Oil and Gas has successfully reached planned total depth with Pine Mills – Fouke 2 Well.

Nostra Terra Oil and Gas is an exploration and production company which has projects in the Permian Basin, Texas, and East Texas. Nostra Terra is an AIM listed company.

The Company has reported that the Pine Mills – Fouke 2 Well has safely reached 6002 feet of the intended total depth post the drilling announcement on February 17th. The well has drilled just below the Cretaceous Woodbine Formation.

Logs show 23 feet of pay sand in two Cretaceous Woodbine reservoir sections. The highest interval being in the same reservoir part as the offset Fouke 1 well. The Fouke 2 sits higher up on the structure and the reservoir has an internal which is both of better quality and thicker (17 feet) than Fouke 1. The Fouke 2 discovered an extra pay section of 6 feet thickness, in the Woodbine Dexter interval. The section was found to be bearing in the Fouke 1.

The completion process has started and the well will be covered and cemented through both pay gaps. The pay sections will then be drilled, the completion equipment will be positioned in the hole, and the surface production equipment will be placed.  The well will then instantly start generating into the Fouke 1 location’s surface facilities, which have been enlarged to accommodate the Fouke 2 volumes.

In the Fouke 2 well, Nostra Terra has a 32.5 percent working interest. The impact of the well on the oil in place is being assessed and the markets will be notified on the update post evaluation.

“We’re very excited about the results of the Fouke 2 well. The Fouke 1 well reached payout (where the full cost of the well was recovered) in under a year. Logging results from this well are better than the Fouke 1 and also exceeded our pre-drill estimates.  Given the higher commodity prices in today’s market and the expected production rates from the Fouke 2, we anticipate an even more rapid payout for this well. We look forward to completing and producing the well in short order,” commented Matt Lofgran, Chief Executive Officer, Nostra Terra.

Nostra Terra shares are trading up 5% at 0.48p on Monday morning despite severe volatility elsewhere in London listed energy companies.

Is Bens Creek share price Justified?

Andrew Hore
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Is Bens Creek share price Justified?

Metallurgical coal producer Bens Creek Group (LON: BEN) is the best performing 2021 AIM new admission with a 500% increase since 19 October. This is a company that has only just started to generate revenues from its coal mine in West Virginia. Yet, it is valued at £211.8m.
Proven and probable recoverable reserves were 2.34 million tons at the time of the flotation, but there are also many millions of tons of in-place coal resources.
There is existing infrastructure and Bens Creek has invested in capital equipment for mining. It is early days and production is starting to build up. The sale of ...

Live Company Group: two new contracts for BRICKLIVE send shares higher

Anshula Kumar
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1
Live Company Group: two new contracts for BRICKLIVE send shares higher

Live Company has secured two contracts for Bricklive’s Paddington and Paw Patrol.

News of the contract wins saw Live Company Group (LVCG) shares jump up by 10.5% to trade at 5.1p.

Live company group organises live events and entertainment. One of the two divisions of LVCG is Bricklive.

Bricklive provides brick-based events focuses on creating an atmosphere that stimulates interactive play, nurtures creativity, collaboration, and physical experiences in a welcoming and secure setting.

Touring Trails

The BRICKLIVE organises touring trails which proved to be popular in venues with high visitor attractions.

The BRICKLIVE range of touring trails have proved to be enormously popular with venues including visitor attractions, zoos, town centres and shopping malls. Their adaptability means they’re suitable for a wide variety of locations, both semi-permanent and pop-up. Their trail models are used by venues to build a dynamic, engaging route map around their site, providing visitors with an enjoyable day out.

Bricklive’s first contract is for Paw Patrol with Northampton BID. The event will run from 12th to 27th March. A trail-map will be set up for collection, where visitors can respond to questions based on their favourite Paw Patrol characters’ models inclusive of Chase, Marshall and Skye.

The second contract for Bricklive is for Paddington with a heritage steam railway. This is not the first collaboration with the iconic railway company. The event will run from May half term.

“I am delighted that we continue to see interest and confirm bookings for the iconic Paddinton Bear and Paw Patrol models throughout the UK. Congratulations to my team for securing these further bookings which I am sure will delight children and parents alike,” said David Cilitira, Chairman, Live Company Group.

Rightmove smashes through Covid-19 with record profits

Natasha Doris
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Rightmove smashes through Covid-19 with record profits

Rightmove has released its end of year results and is celebrating record profits of £304 million, a 48% rise compared to 2020.

The property and real-estate company enjoyed a share price increase of 3% to 634.4p in early morning trade on Friday, joining the FTSE 100 rally after the shock of the Ukraine invasion caused it to rapidly drop on Thursday.

Rightmove also announced an operating profit of £226.1 million, representing an increase of 67% on 2020 operating profits of £135.1 million.

The firm recorded basic earnings per share of 21.3p, which marked an increase of 69% from 12.6p against 2020 results.

Rightmove added that its underlying earnings per share came to 21.8p, equating to an underlying earnings per share increase of 70% against 12.8p in 2020.

The final dividend was reported as 4.8p per ordinary share, taking the total dividend for 2021 to 7.8p against a 2020 dividend of 4.5p.

“Our position at the heart of Britain’s home-moving journeys strengthened even further in 2021, with people spending an incredible 18 billion minutes searching and researching for their new home,” said Peter Brooks-Johnson, CEO at Rightmove.

“I’m proud of our role in helping more people than ever before find a home that meets their needs and helping our customers help sellers and landlords achieve the best price by having their properties marketed to by far the biggest home-moving audience in the UK.”

“Our ambition to make home moving easier in the UK is undiminished and drives our everyday business and longer-term strategy, and I’m excited about our plans to use our industry leading platform to digitise more of the home-moving journey.”

IAG reports €3.5bn loss and looks forward to recovery

Natasha Doris
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0
IAG reports €3.5bn loss and looks forward to recovery

The International Consolidated Airlines Group (IAG) saw its share price fall considerably in the early morning trade on Friday, heading the top FTSE 100 fallers at a 1.85% drop to 144.6p.

The company reported that its losses had fallen from its record £7.8 billion in 2020 to £3.5 billion, alongside an increase in revenue of 8.3% to £8.5 billion.

IGA further reported operating losses before exceptional items of €2.97 billion for the end of 2021 against losses of €4.39 billion in 2020.

The company added that its passenger capacity was 58% of its 2019 capacity prior to Covid-19 for its fourth quarter, marking an increase from 43% in its third quarter.

IGA’s full-year capacity was reported at 36% of 2019, with the Covid-19 pandemic and the introduction of the Omicron variant denting the company’s revenue.

The travel company is aiming for its passenger capacity this year to hit approximately 65% of 2019 levels in the first quarter of 2022, followed by an 85% capacity for the entire year.

“We are confident that a strong recovery is underway. Our teams across the Group are taking every opportunity to develop our business while capitalising on the surge in bookings when travel restrictions are lifted,” said Luis Gallego, CEO at IAG.

“Our people’s extraordinary work and dedication has been key to weather this crisis. We are also monitoring recent geopolitical events closely to manage any potential impact.”

“Demand slowed down for very near-term trips following the emergence of Omicron in late November.”

“However, bookings have remained strong for Easter and summer 2022 having picked up in the New Year. We expect a robust summer with IAG returning to around 85% of its 2019 capacity for the full year.”

“As we ramp up operations our customers remain at the heart of everything we do.”

“We know that after the worst crisis in aviation’s history we must do things differently. Our model enables us to capture revenue and cost synergies while maximising efficiencies which means we are set up to return to profitability in 2022.”

AJ Bell investment director Russ Mould added: “Covid’s multiple variants have weighed on sentiment towards wanting or being permitted to fly, which has put a lot of financial pressure on airlines. Now we have the war between Russia and Ukraine making some people nervous about wanting to get on a plane again.

“All of this adds up to a big headache for International Consolidated Airlines which continues to lose money.

“While its loss after tax narrowed considerably in 2021, net debt has ballooned and capital expenditure is set to increase more than five-fold in 2022 to €3.9 billion as it must rebuild capacity, take delivery of aircraft delayed from last year and meet delivery payments deferred from previous years.”

“International Consolidated Airlines will have to become more creative to try and win back the business customer or reconfigure its strategy to encourage more leisure travellers to fly further on its planes.”

Evraz shares fly 19% on full year earnings announcement

Anshula Kumar
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0
Evraz shares fly 19% on full year earnings announcement

Evraz shares soared 19% to 205p after the release of their full year earnings on Friday.

Evraz has announced a rise of 45% to $14.1bn in revenues across all business segments in a solid report which will be overshadowed by the Russian focused steelmaker’s source of income.

Higher sales prices for semi-finished and construction items, as well as increased volumes for vanadium products, contributed to the increase. Third-party sales of coal with higher average realised prices also made a contribution to the rise of total segment revenues.

Revenues in the coal segment climbed by 55.8% over a year to $2.3bn helped by a 68.8% increase in coal product sales prices.

Net profit saw a 262% rise from $858m to $3.1bn in one year, along with EBITDA increasing by 126% to $5bn, due to growth in sales prices of vanadium, coal products and higher steel.

An increase of 0.8% in selling and distribution expenses in 2021, were recorded due to rise in freight transportation cost because of larger volumes and higher freight rates.

“In 2021, the steel industry was mostly driven by demand-side fluctuations. Steelmakers increased output in anticipation of more robust demand from the construction and manufacturing sectors. Unable to keep up with the accelerated pace of recovery, steel prices rose to their highest in years,” said Aleksey Ivanov, Chief Executive Officer, EVRAZ.

“Amid the upswing on global markets, EVRAZ delivered outstanding financial results in the year, with total segment EBITDA amounting to US$5,015 million and the EBITDA margin reaching 35%. In addition, the Group continued to implement its efficiency improvement programme, which resulted in an EBITDA effect of US$590 million.”

The Company announced an interim dividend of 50 cents.

Evraz has been heavily hit by the events in Ukraine but the company avoided any major acknowledgement in today’s release.

“Results from Russian steel producer Evraz provided an indication of the tricky spot firms with links to Russia are in – with the company just barely acknowledging the conflict, or ‘geo-political situation’ as it euphemistically dubs it, in a statement so thinly worded as to be meaningless,” said AJ Bell investment director Russ Mould.

Victorian Plumbing under pressure

Andrew Hore
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0
Victorian Plumbing under pressure

The Victorian Plumbing (LON: VIC) share price continues to decline as sales remain lower than the year before. An AGM statement revealed that like-for-like revenues are 3% lower, in the first four months of the current financial year.
On the plus side, the second half comparisons are less tough and there could even be some growth in revenues in that period. Some higher costs are being absorbed by the business and this has reduced margins. Management remains optimistic about the longer-term prospects.
Victorian Plumbing joined AIM in early June 2021 at a placing price of 262p a share. The Radcl...

Bitcoin crashes and loses any credibility as a safe haven

UK Investor Magazine
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0
Bitcoin crashes and loses any credibility as a safe haven

Bitcoin cratered on Thursday as geopolitical turmoil exposed the cryptocurrency as one that trades as a risk asset, as opposed to a safe haven.

Bitcoin was trading down by 3.8% at $36,120 on Thursday afternoon as the market reacted to the invasion of Ukraine by Russia.

Crypto enthusiasts had previously purported that Bitcoin could provide safe haven characteristics similar to gold. However, today’s move confirms that Bitcoin is more closely tied to the volatility of risk assets such as equities, than it is to safe havens like Gold and Bonds.

Indeed, today’s Bitcoin move tracked equities sharply lower suggesting the market views the asset as one that cannot relied upon for safety during times of volatility.

“The crypto world’s hopes for assets like Bitcoin to achieve digital gold status have evaporated as speculators have headed for the exit as the crisis in Ukraine has deepened,” said Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown.

“Because of its fixed supply Bitcoin had been hyped as a potential safe haven in times of higher inflation and market volatility, but instead has swung wildly down as equity market sell offs have intensified.”

Today’s move added to evidence Bitcoin was trading as a risk asset following the close correlation with technology shares in 2022. Technology shares have performed terribly in 2022 as the prospect of the higher interest rates made their high valuations look vulnerable.

This was also the case for Bitcoin.

“Crypto assets have been shown to be highly sensitive to the fortunes of the stock market and were propelled higher in an era of ultra cheap money,” said Streeter.

“As conflict in Ukraine looks set to be yet another inflationary driver with oil spiking again, up 8% at $104 a barrel there is fresh speculation that central banks could be forced into more unexpected monetary policy moves, with an acceleration of rate hikes potentially on the cards. With huge uncertainty around how deep the Ukraine conflict could go and what ripple effects there could be in financial markets, crypto assets are likely to continue to be highly volatile.”

Sovereign Metals: A globally significant natural rutile discovery

Anshula Kumar
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0
Sovereign Metals: A globally significant natural rutile discovery

Sovereign Metals presented at UK Investor Magazine Metal & Mining Conference providing deep insight into the globally significant natural rutile project in Malawi, Kasiya.

Malawi

The company spent 6 years exploring for graphite in their Malawian licenses and during their metallurgy tests on the graphite, found tailings of titanium. On studies of 125 drill holes in prospect, Sovereign found the presence of high grade titanium rutile.

Post lab work, the rutile found in Kasiya was established commercially viable. The rutile was of premium quality with low impurities and no critical impurities. 

Why is Rutile important?

Rutile is the purest form of titanium dioxide (TiO2) also known as titania. Titania is used in the manufacturing of titanium, pigmenting, welding and metal work across various industries such as aerospace, medical, paint are major consumers of titanium.

The titanium market is worth $30b where pigment contributes $25b and metal work contributes $5b.

Natural rutile constitutes 95% of titania, whereas, ilmenite has only 50%. Natural rutile has a value of $1350 per tonne where as ilmenite only attracts $200 per tonne.

Due to the scarce nature of rutile, in 2020, 6m tonnes of ilmenite supplied the titanium dioxide market and natural rutile only supplied 0.5m tonnes.

Highlighting the importance of the Kasiya rutile project, the supply of natural rutile is expected to drop 70% from 2017 to 2030.

Over the same period, demand for TiO2 is forecast to increase by 2.8m tonnes.

Carbon Footprint

With increased demand for titanium, alternatives were created by carbon and energy intensive processes for upgrading ilmenite.

However, this process still doesn’t match the TiO2 grade of natural rutile further strengthening the value of Sovereign’s asset in Malawi.

Indeed, 2.8 tonnes of carbon dioxide emissions per tonne is saved when extracting natural rutile instead of upgrading ilmenite.

Kasiya Project

Kasaya is one of the top 2 rutile depositories found in the world, second only to Sierra Rutile. The scale and grade of the Kasiya project makes it the most significant discoveries of natural rutile in 50 years.

Kasiya has an inferred resources of 605m, and there is a strong chance of this being increased as the result of further scoping studies, due to be released in 2022.

If 605m tonnes of ground is mined at 0.98% rutile conversion, the rutile extracted will amount to 6m tonnes and graphite will be 7.5m tonnes.

Scoping Study

Expected mining life of the project is 25 years. Over that duration 12m tonnes of material is expected to extracted annually. Out of which 120k will be rutile and 80k graphite.

The NPV on this project is expected to be $861m with an IRR of 36%, both post tax. The capital cost of the project sums to $332m which is expected to be paid back in 2.5 years.

The revenue generated from this project is expected to be $251m with EBITDA at $161m.

The project is expected to give back to Malawi economy and also generate 480 direct jobs and various indirect jobs.

Geology and Mining

The rutile mineralisation are found 0.5 metres from the surface and extend to the premium material lies in the top 5 metres resulting in easy extraction. The extraction will be conducted by tried and tested, hybrid hydro/ dozer mining as the material is soft and homogenous.

The mining process is quite simple with the machine irrigating the land and creating a slurry. The slurry then goes into the plant where it goes through conventional flow. The results are 95% TiO2 and 96% TGC.

Post the mining process, the slurry minus the minerals are poured back into the ground. This means that disruption to the local environment reduces from decades to months. The land can later be used for farming and other uses.

The material processed can be moved by the Nacala corridor which passes by the Kasiya region all the way to the ports in Mozambique. The port has the facilities to export the expansive material.

Timeline

In the year ahead, the carbon emission assessment will be reassessed to understand the realities of the rutile extraction. The updated study will give us a clearer understanding of the JORC resources and any upgrades to the NPV.

Currently, the Kasiya project is still in the scoping stage and moving forward, they plan to test a larger area of the land.

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