|
Gloomy news on house prices over recent days
seems to be dominating the broadsheets and
souring opinion over the prospects for a
sustained economic recovery. However we must not
lose site of the fact that only last month UK GDP
growth figures for the quarter to June 2010 came
in at 1.1%, 50 basis points above consensus
forecasts. Furthermore corporate earnings of
late, particularly from the banks, have been
encouraging. However the conflicting data
concerning the sustainability of any recovery,
and the coalition Government’s admittance
that a double dip recession remains a real
possibility, should help to prevent any material
rise in base rates in the immediate future.
Source: Digital Look
So the Jury is out on which direction the UK
economy is heading, but in our opinion a
sustained recovery will come. It is just a matter
of timing. And when it does the neglected gems in
the small cap arena will have a chance to shine.
It is well recognised that small caps are under
researched particularly in a recession, meaning
that investors need to dig deeper to expose the
growth and value stories at this end of the
market. During a downturn it is likely that the
higher quality small caps are unfairly punished
alongside the laggards. Our advice would be to
prioritise small caps with robust balance sheets
and those with better earnings visibility.
There are a number of reasons that smaller
companies could be better poised to take
advantage of a recovery than their larger
cousins. In terms of adding capacity when
required smaller companies are more likely to be
able to ramp up staff numbers early in a
recovery. They are also more likely to benefit
from increasing margins due to operational
gearing.
M&A is another trend that we expect to see
increase in the small cap universe. As larger
companies confidence in the outlook improves,
they will seek to make more efficient use of
their cash reserves and seek to grow profits
faster than organic growth alone will allow. The
purchase of smaller companies at attractive
valuations is an ideal way to achieve this
goal.
To conclude, we understand that investors may be
dubious about investing in small caps whilst the
economic outlook is still so uncertain, and of
course a balanced portfolio still spreads the
risk. But one would be foolhardy to ignore small
caps altogether. We believe it is a question of
when rather than if the recovery strengthens, and
when it does quality smaller companies will offer
generous returns to loyal investors. The longer
investors wait to dip back into small caps, the
greater the chance of missing out on significant
chunks of alpha.
|
Key Data
|
30th June 2010
|
31st July 2010
|
Change
|
|
FTSE 100
|
4,916.90
|
5,258.00
|
6.9%
|
|
FTSE 250
|
9,366.12
|
9,948.72
|
6.2%
|
|
FTSE Smallcap
|
2,690.90
|
2,782.43
|
3.4%
|
|
FTSE AIM
|
662.30
|
685.68
|
3.5%
|
|
WTI
|
$75.63
|
$78.95
|
4.4%
|
|
Gold
|
$1,242.40
|
$1,181.40
|
-4.9%
|
|
U.K. Base rates
|
0.50%
|
0.50%
|
0bp
|
|
U.S. Fed Funds rates
|
0.25%
|
0.25%
|
0bp
|
GE&CR currently covers a universe of 50
stocks, having initiated its coverage of @UK,
African Eagle, Empresaria, Hambledon Mining, ILX
Group, Northbridge Industrial, Pinnacle Telecom
and Resources In Insurance Group in recent weeks.
We anticipate initiating coverage of an
additional three stocks in the coming
weeks.
Index
- list of companies
A
@UK plc
Access Intelligence***
Active Energy*/**/***
Adept Telecom**
African Aura Mining
African Eagle
Ambrian Capital****
Amur Minerals
Angel Mining*/***
Ascot Mining**/***
Avanti Communications***
Avation*
Avisen*/***
B
Blavod Wines & Spirits***
C
Character Group
D
Design Capital*
E
EMED Mining*/***
Empresaria***
F
Forbidden Technologies*/**/***
|
G
H
Hambledon Mining***
Healthcare Enterprise Group*/**/***
Henderson Morley*
I
ILX Group***
Inland
Intandem Films*/**/***
Intellego*/**
IQ Holdings*/**/***
J
Jubilee Platinum*/***
K
Kenmare Resources
Kibo Mining*/**/***
|
L
M
Media Corp*/**
Metals Exploration
Minoan*/**/***
Mirada*/***
N
Nighthawk Energy*
Northbridge Industrial
Northern Petroleum*/***
P
Pan African Resources***
PetroLatina Energy
Pinnacle Telecom*
Plastics Capital
Polo Resources
|
R
RAM Investment Group*/***
Red Rock Resources***
Resources In Insurance
Group*/**/***
Rethink Group*/***
S
Sirius Exploration
Skywest Airlines*/***
T
Third Quad Group */**/***
W
Wren Extra Care Group
|
@UK plc
We initiated coverage of @UK (see note dated 28
July 2010), which is one of the UKs largest
online company formation agencies offering a
range of services and related products as well as
a rapidly growing cloud based Software as a
Service provider of B2B and B2G eCommerce
solutions: SiteGenerator, eMarketplace,
SpendInsight and GreenInsight.
The company formation division is the groups cash
cow while its growth engine is the B2B and B2G
eCommerce solutions, which are fully PCI/DSS
compliant (highest electronic payment standard)
where the UK market opportunities exceed 205
million pounds per annum and the company has over
25% market share. It is believed that 0.8 million
of the companys 1.0 million client logons already
use the eCommerce market place. It is this
together with PCI/DSS compliance that secured a
close working relationship with Barclaycard. We
anticipate the company securing further overseas
financial partnership agreements as multilingual
sites are rolled out thereby multiplying its
market opportunity.
The interim results confirmed the paralysing
effect the General Election and emergency Budget
had upon procurement decisions across vast
sections of the public sector, which suggests a
backlog in demand, which if immediately cleared
would move the group into profitability. However,
we have assumed that the company is lagging,
probably by no more than a year, its expectation
of achieving critical mass for its eCommerce
platforms, and the group moving into sustainable
profitability and cash generation.
The company is seeking to raise additional
general working capital; of we believe 100,000
pounds that will be used in supporting the
release of latent demand public sector demand for
eCommerce procurement solutions that the @UK
anticipates from this autumn.
We have adopted a very cautious approach to our
forecasts, which broadly anticipate increased
eCommerce demand from 2011. Nevertheless, we
believe the shares are undervalued and would rate
them a speculative buy.
Access Intelligence***
Access Intelligence, the AIM listed supplier of
compliance solutions via Software-as-a-Service
(SaaS) released results on 19 July for the six
months ended 31 May 2010 that further confirmed
its strategy is delivering. Indeed, the group
operating profit before exceptional items
exceeded those of the whole of the last financial
year. While recurring revenue increased 65% from
1.4 million pounds to 2.4 million pounds and now
represents 57% of total revenues; total monthly
revenue had reached 0.7 million pounds by the end
of May of which recurring revenues represented
0.435 million pounds while monthly costs were
around 0.6 million pounds.
Despite the expectation that the public sector
purse will shrink substantially over the coming
months, Access Intelligence, like most public
sector exposed businesses that demonstrably
provide low cost solutions that enhance service
efficiency, views the future with cautious
optimism. The company’s optimism stems from
the successful organic and acquisitional
development of its compliance/SaaS activities
that have grown over the last 12-months from 55%
of total revenues to 77%; last Februarys Cobent
acquisition increasing private sector exposure
and international opportunities. We have reviewed
our earlier expectations and are edging back our
sales expectations for 2010 from 9.6 million
pounds to 9.1 million pounds and 2011 from 11.7
million pounds to 10.7 million pounds but
maintaining our pre-tax profit and earnings per
share forecasts.
We continue to value Access Intelligence using an
Enterprise Value/EBITDA (EV/EBITDA) methodology
and with the shares trading at 4.5p, the
financial year 2009 multiple would be 10.1 times.
Therefore, if the shares were to trade on a
similar EV/EBITDA multiple based on our
maintained 2011 forecasts, the shares should be
8.7p; consequently, we continue to recommend the
shares as a buy.
Active Energy (formerly CINPart)
*/**/***
On the 30th of July, Cinpart changed its name to
Active Energy to reflect its immediate focus.
There is a potentially immense opportunity in
actively saving energy for a targeted 400,000
buildings in the UK alone. The roll-out of its
operations it set to accelerate following the
completion on the 16th of July of a 1.3 million
pounds funding and the consummation of a key
relationship with a division of Scottish &
Southern Energy. The UK roll-out is the focus but
signalling future intentions a Memorandum of
Understanding has been signed with three US
companies announced offering the prospect of an
international roll-out as the voltage
optimisation product-set, VoltageMaster may have
greater growth opportunities in America than the
UK. At this stage, sales growth is difficult to
sensibly quantity but given the widespread
availability of Government loans of up to 100%
for the Active product. Competition in this space
is currently light, but likely to grow,but this
should not detract from the opportunity for
Active Energy to build on its UK market presence
firstly into the US and subsequently into Asian
and Middle East markets. The pace of the UK
rollout and the size of each contract is hard to
judge. For example if a major retail chain
required 200 buildings to be fitted at say 25,000
pounds (net to Active Energy) this would make a 5
million pounds contract. Our 2010 and 2011
forecast do not discount major contracts of that
scale or any real international inroads being
made and thus the risks to numbers are on the
upside. Currently capitalised at less than 10
million pounds and forecast to be profitable
within a year, we set a price target based on 1.5
times forecast 2011 sales of 16.1p. Our stance is
speculative buy.
Adept Telecom**
AdEPT Telecom, a leading independent provider of
voice and data telecommunications services to
small and medium sized UK-based businesses,
announced its results for the year ended 31st
March 2010: underlying EBITDA and pre-tax profit
were in-line with our forecasts. The company
reported adjusted EBITDA of 3.61 million pounds
and an underlying pre-tax profit of 2.22 million
pounds, up from 3.52 million pounds and 2.06
million pounds respectively despite a near 10%
decline in revenue to 25.73 million pounds (see
GE&CR note dated 13 July 2010).
The business model continues to demonstrate its
resilience and management its ability as, despite
the top line pressure in an exceptionally
challenging economic climate, the past year
represented the seventh consecutive of underlying
EBITDA growth since the companys inception in
2003. As such, we continue to see our target
price as modest and expect more in the
longer-term as investor focus switches from
AdEPTs debt to the multiple its consistent cash
flows are being afforded.
African Aura Mining
African Aura released its final results for the
12 months to 31st December 2009 on the 21st April
2010 highlighting its continued progress on both
its flagship and peripheral assets, while finally
seeing the stock market listing of Stellar
Diamonds.
The 100% owned 1.38 million ounce New Liberty
gold mine in Liberia was granted a class A mining
licence in August 2009, while it recruited a
general manager of operations in December 2009 to
accelerate exploration at New Liberty and oversee
a scoping study by AMC and follow-up definitive
feasibility study (DFS) incorporating an
operation capable of producing 100,000 ounces of
gold per annum.
The 38.5% owned Putu Iron Ore project in Liberia
announced a NI43-101 inferred resource estimate
of 1.08 billion tonnes of iron ore at a grade of
37.6% on the 3rd of August 2009. Severstal
Resources is earning a 61.5% interest in the
project and the partners expect to define a 2
billion tonne resource as exploration continues
along the remaining three quarters of the 12
kilometre long strike. Putus exploration licence
expires on the 30th September 2010 and the
company is now seeking the issuance of a full 25
year Mineral Development Agreement (MDA), as it
begins to think about development plans.
Stellar Diamonds was admitted to AIM on the 22nd
February 2010 after a merger with West African
Diamonds. African Aura retains a 31.8% interest
in the listed company, with Stellars listing long
flagged.
The companys other assets in Liberia, Sierra
Leone and Cameroon are showing slow by steady
progress as African Auras focus is understandably
at Putu and New Liberty.
Financially the company reported full year
revenue of $1.18 million ($0 in 2008), but a
$12.3 million loss (loss of $2.2 million in 2008)
after a $7.8 million project impairment charge
(predominantly attributable to the temporary shut
down of the Kono diamond mine due to weak diamond
prices), the absence of a $7.2 million paper
profit on its Stellar investment, and a lower
gain on the disposal of some of the companys
interest in Putu to Severstal ($3.1 million vs
$7.8 million in 2008). As at the 31st December
2009, the company had a net debt position of $1.3
million compared to net cash of $5.8 million at
31st December 2008. The main contributors to this
were a fall in cash/equivalents ($3.7 million vs
$8.9 million) and a $1.7 million increase in
convertible debentures ($3.8 million vs $2.0
million). However, the company successfully
placed 17.4 million shares at 65p each on the
21st April raising 11.3 million pounds which,
along with funding the DFS at New Liberty, will
allow African Aura to further explore for iron
ore at Nkout in Cameroon, produce a NI43-101
compliant gold resource estimate for the Liberian
Weaju project and provide money for general
working capital purposes.
With gold maintaining its high pricing levels and
strong iron ore demand set to resume as the
global economy recovers, we maintain our
speculative buy recommendation
but reduce our target price to 245p after the
dilution from the share issue
African Eagle
After
the release of 98 resource definition drilling
results from the Dutwa prospect on the 10th of
June, African Eagles headline project received a
major JORC resource upgrade on the 15th of June.
The total resource tonnage increased by a factor
of three to 92.1 million tonnes, while the amount
of contained metal increased by almost two and a
half times to 845,000 tonnes of nickel equivalent
(0.92%). Independent consultants Snowden is in
the process of upgrading part of the resource
from Inferred to Indicated status using drilling
data collected during the past 12 months.
On
the 24th of May African Eagle reported strong
results from Dutwas column leach tests with high
recoveries and low acid consumption. Initial
leaching yielded 60 - 65% of the nickel being
extracted within two weeks. After one month 73 -
82% was recovered, while after the full five
month test the amount of nickel recovered was 90
- 94%. Acid consumption averaged 199, 273 and 360
kilograms/tonne over the two week, one month and
five month periods respectively.
Final
assay results from drilling at Ngasamo Hill in
the Dutwa project were announced on the 10th of
May with 59 of the 66 holes intersecting
mineralisation. Highlights were 75 metres at
1.42% nickel, 84 metres at 1.07% nickel, 63
metres at 1.41% nickel, 18 metres at 0.47%
cobalt, 54 mettres at 0.13% cobalt and 9 metres
at 0.43% cobalt. In addition, African Eagle has
appointed Snowden Mining Industry Consultants to
undertake a formal resource estimate on Dutwas
satellite deposit.
At
Miyabi in Tanzania, African Eagle signed a letter
of intent with Macquarie Harbour Mining Limited
on the 14th of May to develop a gold mine at the
prospect. Macquarie will provide the funding and
technical expertise through to the completion of
a feasibility study sufficient to enable
Macquarie to make a decision as to whether the
project warrants development. African Eagle will
retain a 25% interest with its past exploration
expenditure credited towards development costs.
The agreement will further free the company both
operationally and financially to concentrate on
its core nickel projects.
Having
updated our model with the new Dutwa resource,
GE&CR increases its target price from 17.1p
to 26.2p and retains its speculative
buy recommendation.
Ambrian Capital****
Ambrian Capital issued a trading update on 6 July
for the six month trading period ended 30 June
2010 advising that the group would breakeven.
However, the largest operation, Commodities has
performed well due to continued strong physical
metals demand from China albeit a lower levels
than for the exceptionally stronger comparable
period. Principal Investments is expected to have
increased its NAV by 37%, however, Corporate
Finance & Equities incurred a loss because of
weak equity markets during the second trading
quarter and lower corporate fees as a result of
many transactions not completing. Consequently,
management has taken action to cut costs to into
line with revenue.
The company has formed a new operation Ambrian
Energy to build upon the success of the
Commodities activities. Ambrian Energy, which
will be led by former CEO of Masefield, Justus
van der Spuy, will focus on the supply of crude
oil, condensates and other energy products
including biofuels. A detailed note will be
published in September.
Amur Minerals
On the 30th of June Amur released its annual
results for the 12 months to 31st December 2009.
During the period Amur completed a Russian
regulatory standard reserve estimate on Maly
Kromkon of 12.9 million tonnes at average nickel
and copper grades of 0.63% and 0.18% respectively
and thus took total its Russian reserves to 31.7
million tonnes at average grades of 0.64% nickel
and 0.18% copper. A Certificate of Discovery was
issued by the Russian authorities thus giving the
Company an exclusive right to file for a mining
licence, while the final mining licence
application was filed with the state Ministry of
Natural Resources in January 2010.
Financially
the company reported a pre-tax loss of $1.8
million down from $2.3 a year earlier, while loss
per share declined from $0.02 to $0.01. As at the
31st December 2009 the company was debt free and
held $997,000 in cash and cash equivalents, an
increase of $555,000 compared with a year
earlier.
During
the remainder of 2010 Amur hopes to raise funds
for further exploration work while the Kun-Manie
mining licence application is assessed by the
Russian authorities. In respect of the former,
Amur announced that it intends to raise 1,236,153
pounds through the issue of 35,318,684 shares at
3.5p each, while an application for the 2 year
extension of the 950 square kilometre Kun-Manie
exploration licence was filed on the 7th of
July.
A
potential expansion of the Ikenskoe deposit,
Kun-Manies largest, was discovered during the
construction of an access road. Announced on the
14th of June, samples have been delivered to a
laboratory for analysis.
Due
to the dilutive effects of the placing we reduce
our target price from 10.8p to 8.8p, but retain
our Speculative buy
recommendation.
Angel Mining*/***
On the 24th of May Angel Mining provided both an
operating and financial update. Nalunaq has now
received all the permits necessary to operate its
Carbon in Pulp (CIP) cyanide leaching circuit
with CIP commissioning expected towards the end
of June. The gravity separation plant has been
operational for 2 weeks now, while fines
collected from within the mine are being
stockpiled for CIP circuit processing. Angel
Mining is expecting 12,000-15,000 ounces of gold
to be produced at Nalunaq in the financial year
to 28th February 2011, with 25,000 ounces
produced in the 2011/2012 financial year.
Meanwhile at Black Angel, construction of the
upper cable car terminal is expected to be
completed in September and both the process
plant, materials handling design and equipment
procure plan are well advanced, but subject to
financing.
The
companys financial situation has been hit by
delays in expected cash flows from Nalunaq and
also project financing for Black Angel. As a
result, the company missed its quarterly interest
payment to FBC Holdings and is in discussions
with financing agent Cyrus Capital partners to
secure its short term cash flow needs. Cyrus gave
Angel Mining a $2 million advance in order for
the company to implement a longer term financing
solution, an amount that was supplemented by a
further $4.5 million advance on the 12th of July.
This brought the total debt to $21 million, but
the company now believes it has sufficient
capital to achieve positive cash flow with full
production.
While
the money from Cyrus appears to have provided the
short term funding needs for Angel, and the
company claims to be in advanced discussions with
a third party on a major funding arrangement, we
suspend our stance on Angel
Mining until its funding requirements are
properly resolved.
Ascot Mining**/***
An offer of $4.5 million in funding was received
from private equity group Equita Global on the
1st of July and, if it is finalised, will be used
by Ascot to complete the expansion of the
Chassoul mine and mill and enable the Tres
Hermanos and El Recio to continue with
development, as well as providing working capital
and for participating in other projects. The
company also received £200,000 from the
SFt1ps Smaller Companies Gold Fund (managed by an
associate company of GE&CR) through the issue
of 200,000 convertible loan notes at 1 pound
each. The notes yield 10% interest, are
convertible at 20p per share and also came with 1
million warrants at 20p each.
Results
for the 6 months to 31st March 2010 were released
on the 30th June with commissioning of the mill
and first gold production at Chassoul the
undoubted highlights. Activities at the LaToyota
project were suspended on the 6th of November
with criminal actions filed against its
mischievous joint venture partner on the 18th of
December. $200,000 in debt was repaid to Ganadera
Los Maizoles on the 22nd of January while Veritas
Mining completed the environmental assessment for
the Las Juntas (Tres Hermanos, El Recio and
Boston mines) gravity mill on the 1st of
February. Financially the company posted its
debut revenue of 14,183 pounds, while higher
finance costs (343,898 pounds compared to 63
punds a year earlier) resulted in an increase in
pre tax losses to 1.0 million pounds (0.6 million
pounds in the 6 months to 31st March 2009). Loss
per share increased from 2.22p to 2.82p while net
debt fell from 2.38 million pounds to 2.05
million pounds.
Ascot
met TSX-V listed Mineral Hill Industries Ltd on
the 19th of May as the two companies agreed to
share information on their respective properties
and discuss closer company ties as Ascot pursues
opportunities to broaden its property portfolio.
Mineral Hill is developing lithium carbonate
exploration projects in Quebec (Canada) and
Nevada (US), with a view to supplying the
lithium-ion battery market: seen as the next
generation power source for electric and hybrid
motor vehicles. An announcement on the 7th of
June confirms discussions are ongoing.
An
operations update on the 13th of May confirmed
that the Costa Rican mining moratorium suspending
open pit mining and the use of certain chemicals
in milling , together with imposing new mining
permits will not impair its operations as all
current and existing mining and milling permits
are explicitly exempt.
On
the 31st of May Ascot placed 2,545,774 shares at
$0.25 to raise $636,443 which will be used to
remove financial obligations. After incorporating
the dilution in our valuation, we reduce our
target price from 81p to 78p but maintain our
speculative buy
recommendation.
Avanti Communications***
Since our last report, Avanti has confirmed that
its Hylas 1 satellite has successfully completed
the demanding Thermal Vacuum Testing and is
remains on target for an end September 2010
launch although the carrier may not be Soyuz but
an Ariane 5 vehicle. While shareholders at the
companys AGM, held on 28 July, duly approved all
the conditions for the completion of the earlier
70 million pounds capital raised. A detailed note
is imminent.
Avation*
On 26 July 2010, the company advised that was
considering proposals for a transfer of its
listing from Plus Markets to the London Stock
Exchange main market: Standard List. Speechley
Bircham has been appointed to advise the company.
A detailed note is imminent.
Avisen*/***
Avisen, the acquisitive business management
consultancy and performance software provider,
released its full year results ended 31 January
2010, a period of substantial corporate
development since its reversal into Z Group on 2
February 2009. During the year Avisen made five
strategic acquisitions that have had to be
integrated resulting in exceptional
charges.
Sales revenues increased from 2.406 million
pounds for the 10-month accounting period ended
31 January 2009 to 7.165 million pounds. Gross
profit increased from 1.303 million pounds to
2.354 pounds million although the gross margin
contracted from 54.2% to 32.9% due to the
broadening out of the business activities
although margins should move up again as
integration benefits begin to feed through. The
enlarged group reported a total operating loss of
GBP3.109 million but this was struck after 1.339
million pounds of exceptional charges. Net
finance costs amounted to 6,000 pounds offset by
a gain on bargain purchase of 46,000 pounds which
resulted in a reported pre-tax loss of 3.069
million pounds or a loss per share of
2.39p.
Since the year end the group has disposed of its
non-core South African activities and completed
the all share 11.4 million pounds acquisition of
Xploite plc whose main operational asset is
Storage Fusion, a SRA software business. The
executive management team has been restructured
with Ian smith, Anthony Weaver and Michael Frank
all leaving to pursue other interests while Mark
Battles joins as non-Executive Interim Chairman
and Claire Milverton has become full time Chief
Financial Officer.
Avisen started the current year building upon the
successful consolidation and integration of its
earlier acquisitions and the momentum was not
disrupted by the acquisition of and rapid
assimilation of Xploite's operating asset Storage
Fusion that is now trading at break even.
Nevertheless, the group is understood to be
generating annualised sales of around 14 million
pounds and an EBITA of around 1.9 million pounds
or a group pre-tax profit of 1.4 million pounds
after central costs of 0.5 million pounds and a
modest net financial income from its cash
balances compared with last year's recorded loss
of 3.069 million pounds (see note of 30 July).
Our stance is buy with a 10p
target.
Blavod Wines & Spirits***
On 14 June, Blavod announced results for the year
to March 31st 2010, which were marginally below
forecasts but the current year seems to have
started well and Blavod has also announced three
key management appointments. The company is
trading profitably and has no telling balance
sheet pressures and we expect that profits will
ramp up significantly during the next three
years. This is not discounted in the share price,
which, we believe reflects the companys track
record of less than full delivery. If Blavod can
start to hit forecasts, we would expect the
shares to be re-rated materially and the new
management appointments give us renewed faith
that this will occur.
Character Group
The interims announced in April showed an
extremely strong turnaround to profits of 3.73
million pounds against a loss of 3.8 million
pounds. Character Group is the owner of a
portfolio of toys and products based on strong
childrens brands including Doctor Who, Peppa Pig
and Scooby Doo, all of which have proven staying
power and provide a platform for sustained sales
growth. In July the portfolio was extended with
an agreement to distributed 10 inch collectable
Michael Jackson dolls. The company has recovered
from the deck clearing finals for the year to
August 31st 2009, which included the loss on
stock to Woolworths. At this stage of Characters
mature organisational development adding to sales
may increase cost of sales but adds little to
administration so there is an operational
leverage effect. Over the years Characters
Directors have shown a keen nose for finding best
selling products. Our cautious forecasts to
August 2011 set a target price of 204p, based on
a PE ratio of 10.5. Our stance at 131p is
buy.
Design Capital*
There has been no financial or trading news since
our last publication. Our stance remains
buy with a target price of
26p.
EMED Mining*/***
On the 15th of July EMED announced that
exploration drilling had commenced at its 100%
owned Banska Stiavnica and Hodrusa licences in
central Slovakia. While EMEDs primary Slovakian
focus is on Biely Vrch, Banska and Hondrusa are a
mere 38 kilometres west of the Detva licence
(Biely Vrch) and thus could form an highly
complementary operation.
An
update on the 8th of June confirmed that EMED had
come to an agreement with the Department of
Social Security (DSS) on the settlement of liens
owed to the DSS by previous owner Minas de Rio
Tinto.16.9 million Euro has been agreed and will
be repaid during a 5 year period with 1.3 million
Euro payable immediately and then payments
(including interest) of 1.1 million Euro, 2.9
million Euro, 3.6 million Euro, 4.2 million Euro
and 5.9 million Euro for each of the next 5
years. EMED has always factored in full repayment
of past debts as part of the costs of reopening
Rio Tinto, so this is not unexpected.
On
the 28th of June EMED announced that its
Slovakian Biely Vrch project had its mineral
resource approved by the Slovakian State
Commission for Classification of Mineral
Resources, that it was granted a certificate for
an exclusive deposit and that an updated scoping
study by AMC Consultants confirmed the economic
attraction of the deposit. EMED is now proceeding
with the preparation of a Preliminary
Environmental Assessment, a critical part of any
mine permitting process.
On
the 13th of May EMED released its final results
for the 12 months to 31st December 2009 with the
company edging closer to recommencing operations
at the Rio Tinto mine and has also made
significant progress in Slovakia. A secondary
stock market listing on the TSX for the second
half of 2010 has also been proposed to widen its
shareholder base and access a more resource savvy
market.
Support
for the re-opening of the Rio Tinto mine in Spain
is almost unanimous with the provincial
government of Andaluca, local municipalities,
labour unions and regional business associations
in Huelva all having publicly expressed their
endorsement of EMEDs plans. Production is
targeted at commencing in the second half of
2011, with the exact date dependent upon final
permits and conditions. A total financing package
of 70 million Euro (plus insurances and bonding)
is required to reopen Rio Tinto and discussions
are already underway with potential product
off-take customers and lead project finance
arranger Goldman Sachs. The company is hopeful of
financing the project largely from debt and
off-take agreements.
In
Slovakia, after defining a JORC resource of 41.7
million tonnes at 0.79 g/t gold for 1.1 million
ounces of gold, EMED completed a scoping study
which indicated an economic operation of 3
million tonnes per annum producing 60,000 ounce
of gold for each year of its initial 10 year mine
life. Cash costs were put in the range of
$500-$600 per ounce of gold with recoveries
averaging 80%.
EMED
has written off all goodwill, exploration
expenditure and care and maintenance costs on
acquisition or when incurred. This has had a
significant effect on the company’s results
with exploration costs of 2.16 million Euro and
care and maintenance expenditure of 2.88 million
Euro combining with administration costs of 3.63
million Euro to produce a pre tax loss of 10.44
million Euro in the 12 months to 31st December
2009. This compares with a 17.06 million Euro
loss in 2008 when the main contributors were 5.15
million Euro in care and maintenance expenditure
and 9.33 million Euro as a provision for the
impairment of goodwill. The loss per share in
2009 came in at 0.03 Euro compared to a 0.08 Euro
loss per share in 2008. At 31st December 2009
EMED reported net debt of 3.32 Euro comprised of
3.56 million Euro in cash at bank and 6.88
million Euro in non-current convertible notes.
Net debt a year earlier was 1.30 million Euro.
Since then it has raised an additional 8.3
million pounds.
On the 17th of May EMED announced a raft of
improvements identified for the Rio Tinto Mine
including mining, processing, environmental,
occupational health & safety (OH&S), and
social responsibility initiatives that will not
only bring the new Rio Tinto operation into the
21st century, but also create a legacy that will
benefit the region long after the extraction of
the mines orebody. For example, use of the latest
optimisation tools will recover more copper and
reduce waste, while environmental initiatives
will include waste recycling, water conservation
and site rehabilitation. Buy
with 34p target price.
Empresaria***
We initiated coverage following an upbeat AGM
statement published on June 3rd that provided
clear evidence that the international recruitment
agency Empresaria is witnessing a strong recovery
in its key markets of Germany, Asia and the UK,
trading so far this year was said to be
materially ahead of expectations. Whilst
we have concerns about the sustainability of the
UK recovery, structural change in Germany and
underlying macroeconomic drivers in Asia lead us
to believe that there is momentum in sales and a
real visibility of earnings going forward. After
suffering, along with the rest of its industry,
in 2008 and 2009 the company has reduced its cost
base by 4 million pounds and a share placing in
May 2009 raised 2.7 million pounds which leaves
the balance sheet in robust shape. A long serving
management team participated heavily in that
placing and own around 30% of the equity meaning
they have a close alignment of interests with
other shareholders. Recruitment stocks are
clearly cyclical and tend to trade on low teen
multiples as the cycle improves and hence we
value the company on 11 times forecast calendar
2011 earnings per share of 7.1p, at 78p but would
note that if recent momentum is maintained we
regard the risks to our forecasts as very much on
the upside and we consider that there is a
material likelihood that we will increase our
estimates and hence target price after the
publication of interim results in
September.
Forbidden Technologies*/**/***
On May 27th, Forbidden Technologies, the cloud
based professional video solution provider,
released final results for the 12-months ended 31
December 2009 under International Financial
Reporting Standards. Sales rose by 131.7% from
121,199 pounds to 280,826 pounds due to increased
repeat orders from existing clients as well new
customers; a trend that has continued into the
current year (see note of 28 May 2010).
During the past year the group has been
strengthening and developing its distribution and
marketing channels by partnering with industry
giants within the primary target markets of
Broadcast (including all post-production
companies), Professional web video and to a
lesser extent in-house video and serious
hobbyists (via Clesh). Forbidden has secured, and
continues to develop, relationships with
Broadcast Interactive Media (BIM), Chyron, True
Tube and Brightcove that has resulted in FORscene
content usage growing from 100 hours per week to
10,000 hours.
BIM has licensed FORscene to more than 60 US
television stations while FORscene has been
integrated into Chyrons AXIS graphics system
which has already resulted in multiple US
opportunities. FORscene has been integrated into
True Tubes SUNY is opening up a new market
opportunity in education while Brightcove is
creating opportunities in the web arena. The
group has indicated that other partnership
agreements are in various stages of negotiation
while last years increased marketing activity has
increased the frequency of direct sales
enquires.
Indeed, it would appear that the synchronised
global recession has accelerated the video
markets shift to digital decisively toward lower
cost web, and increasingly cloud, based
production solutions. It is this accelerated
shift as well as the rapid uptake of FORscene by
the video industrys giants and their customers
accelerating usage that has encouraged the group
to build out more rapidly its global business
development and technical sales support
capabilities. Consequently, during, at least the
next two years, administrative costs will
continue to increase more rapidly than previously
anticipated. However, these costs should
comfortably lag the growth in sales and as a
result enable the group, on our revised and more
conservatively based sales projections, to still
close the current financial year the right side
of break even while confirming our earlier
expectation of the group moving more decisively
into profit the following year.
Nevertheless, valuing emergent technology plays
is fraught with risk, most notably a newer and
possibly better replacement technology. Forbidden
falls into this category because the Company,
since 1998, has been developing a software video
editing suite based upon a long held vision of
how the internet and media would converge. The
difference between then and now is that all the
technologies exist in terms of internet hardware
delivery infrastructure, storage and server
capacity, computer processing power, etc.
Moreover, convergence is happening (e.g., digital
media, IPTV, etc.), which is stimulating demand
for more and newer content while finally the
global recession appears to be encouraging a more
rapid change in established media work practices
that favours companies such as Forbidden.
With very conservatively estimated sales revenues
at least doubling annually and potentially being
sustained at that rate beyond the forecasting
period to 31 December 2011 while cost increases
comfortably lag this growth rate, pre-tax profit
and earnings per share should increase rapidly;
for example earnings per share on very
conservative revenue growth projections are
forecast to grow 13-fold!
On 27 July, the company agreed to grant Rivington
Street Ventures an option (the "Option") to
subscribe for 500,000 new ordinary shares of 0.8p
each in the Company at 24p per share. This grant
follows the success of last year's option grant
to the SF t1ps Smaller Companies Growth Fund. The
Option is being granted in consideration of the
payment by RSV to the Company of the sum of 5,000
pounds. The initial term of the Option is four
months; however if the Option is partially
exercised within the first four months, the
Option to exercise the remaining shares will be
extended for a further eight months (26 July
2011). Our stance remains buy
with an 89p target.
Hambledon Mining***
On
the 8th of July Hambledon issued an upbeat
production statement covering the second quarter
of the calendar financial year. This confirms our
belief that a ramp up in production from its open
pit at Sekisovskoye is sustainable and that this
operation should be capable of generating enough
cash to fund the development of a larger
underground mine on the site. In the three months
to June 30th 2010 Hambledon broke records for
tonnes milled at 213,034 tonnes while gold output
surged by 16% on the prior quarter to a record
8,700 ounces. It is our expectation that output
will be 26,000 ounces this year increasing to
40,000 ounces in calendar 2011. Output should be
boosted further by the signing of additional
third party processing deals. In March this year
Hambledon reached agreement with the owner of
another Kazak mine (Beskempir) to treat ore from
that mine at its mill. It treated 4,406 tonnes of
ore in April 2010 and 4,962 tonnes in May
2010.
On
19 May 2010 it announced a second contract for
the shipment of 10,000 tonnes and the delivery
and treatment of this material commenced in
mid-June. The company says that further contracts
are expected in due course. The margin earned on
this operation is not stunning but it is a
profitable operation which generates additional
cashflow. And Hambledon now states that it has
been approached by other mine owners seeking to
conclude similar agreements. Buy
with an initial price target of 16.8p.
Healthcare
Enterprise Group*/**/***
There has been no financial or trading news since
our last publication. Our stance remains
speculative
buy.
Henderson Morley*
Henderson Morley plc, the AIM quoted
biotechnology company, and KMS Therapeutics
continues to work toward completion of the Letter
of Intent. KMS is satisfied with the results of
its scientific due diligence on ICVT and has
reaffirmed its commitment to the
commercialisation of ICVT. KMS is continuing to
work with several venture capitalists to finalise
a funding structure as soon as possible, to
facilitate legal completion of the acquisition.
Whilst Henderson Morley remains confident that
negotiations with KMS will be concluded, it is
continuing discussions with the unnamed non
European company that signed an LOI last October,
and will continue these discussions until such
time as the sale of ICVT is concluded.
ILX Group***
We initiated coverage following the publication
of final results for the 12-months ended March
31st 2010 by vocational training provider ILX
Group contained no surprises at a trading level
but demonstrated once again how cash generative
this business is and how it has transformed
itself during the past three years from a
provider of training services to a creator of
e-learning software products. The effect of this
transformation is to open up new international
prospects for growing sales while also widening
margins. There must be some concern that with
around 20% of revenues historically generated
from sales to the UK public sector, that budget
cuts will restrict growth this year. However, we
feel that this will be offset by increasing
overseas and private sector software sales and,
moreover, that any risks to forecasts are more
than discounted in an undemanding
valuation.
Indeed, on 19 July, the group stated that since
the end of the last financial year growth has
continued, with Q1 revenues and profits across
the Group substantially ahead of last year. On 13
August the company announced that it would not
pay a dividend this year in order to accelerate
debt repayment plans although trading is at least
in line with forecasts. Our stance remains
buy.
Inland
Following the return to interim profits, on the
1st of July it was reported that planning
permission has been agreed in principle for the
733 Homes in the West Drayton Garden site . For
the six months to December 2009 a profit of
107,000 pounds was made, which compares to last
years horror loss of 4.2 million pounds, which
included a 3 million pounds exceptional charge.
The NAV is reported at 23.95p, gearing at a
non-threatening 21% and the bank facility of 9.3
million pounds now renewed for 15 months giving
plenty of scope for 4 million pounds to be repaid
from cash flow.
Inland finds and buys Brownfield/ex-MOD sites
with the objective of adding value by securing
planning permission and selling the assets on to
developers and residential homebuilders. Although
not a core activity Inland are building on some
sites producing cash flow and profits while
the commercial property market recovers. A joint
venture at West Drayton, where planning
permission is due to be granted in fully granted
for residential, employment and community use
representing a build out value of 185 million
pounds. The development timing of this flagship
project could significantly impact on our
forecast for 2011 and beyond. Poole Harbour is a
9.5 acre site and is one of the largest
regeneration projects in the south west and
planning permission for approximately 500 homes
is likely to be submitted. Queensgate, which was
acquired on 11th August 2006 is much further
advanced with planning consent granted for 399
residential units, an 80 bed care home and 50,000
square feet of commercial use development. We
have increased our forecasts for the year to June
30th 2010 from a loss of 300,000 pounds to a
profit of 200,000 pounds and the real
significance is that this perhaps signals the
restart of Inlands growth. We are leaving 2011
forecast to June 2011 unchanged with a
conservative estimated NAV of 26.8p, but we are a
one fully granted planning permission away from
31p if West Drayton was include and our stance is
Buy.
Intandem Films*/**/***
Being in the film business makes for entertaining
newsflow but the latest announcement shows it
also points to a progressive recovery. As in May
a new project, 'Dreams of a Dying Heart' was
announced, to which two time Oscar winner, Hilary
Swank, is attached. Intandem will co-produce and
sell this movie. The addition of this movie
brings the slate up to 31 films under management
and further builds on an exciting start to the
year.
The balance sheet issue have now been cleared and
the pipeline of new films continues to improv.
Our forecasts assume that Intandem achieves a
deal flow of 6 modest budget (average of £5
million) films this year rising to 8 in 2011.
There is always the chance, with CEO Gary Smiths
contacts in the film world, for much larger
projects which given the operational leverage
could transform the P&L. We remain cautious
on our earning assumptions and the shares trade
on a June 2011 PE Ratio of less than 6.75
(assuming no tax is paid). Given the increase
earnings visibility, the developing film pipe
line and high operational leverage, we now view a
rating of 12 times as fair for a growth play
giving a price target of 7p.
Buy.
Intellego*/**
Followers of this company have seen a sequence of
announcements, which in sum suggest that
Intellegos new team of executive directors will
develop the high margin side of the business with
a lower cost base and with a cleaner balance
sheet. The group has completed its restructuring
including, we believe, the CVA that eleminated
debtors. Going forward the quality of earnings
should be more robust and visible because of
focusing on the higher margin and repeat revenue
business from an expanding library of Intellego
owned material, such as the recently launched
financial services products the Diploma in
Financial Planning and the healthcare libraries,
Zenosis and Think Medicine. Aim listed Net
Dimensions has brought back distribution rights
to its own branded e-learning solution for up to
464,000 pounds of which some of the funds will be
offset against debts and Net Dimensions has taken
an 13.7% stake in the enlarged group. We are
reviewing our forecast but are confident that,
perhaps at last, Intellego can build its
acquisitive growth strategy from a stable
profitable base. Buy
IQ Holdings*/**/***
On 26 May, the company raised a further 0.1
million pounds through the issue of 6%
convertible unsecured loan notes (25 May) 2012
with interest paid quarterly in arrears.
The executive management team has been
strengthened through the appointment of Mr Julian
Green as CEO and Mr Russell Darvill as Finance
Director following the departure of the John
Mitchel. David Marks has replaced Tim Hearley as
non-executive Chairman.
IQ released its results for the 18-months ended
31 March 2010 that are of academic because the
covered the period of fundamental restructuring
that resulted in the group divesting all its
trading operations and becoming a listed shell.
The new executive management team is actively
pursuing opportunities that should result in the
reverse take-over of the company and hopefully
generate shareholder value.
Jubilee Platinum*/***
Pilot scale refining trial results were released
on the 21st of July with Chemical Vapour Metal
Refining (CVMR) process trials extracting 99.5%
of nickel and 95.6% of iron from ConRoast alloy
during phase 1. Phase 2 has commenced and will
perform additional refining test work and the
preparation of feasibility study
documents.
On
the 15th of July Jubilee announced the signing of
a Memorandum of Understanding (MoU) with Northam
Platinum Limited whereby the two companies will
investigate the construction of a 7MVA DC
ConRoast arc furnace to treat the PGM concentrate
from Northams Booysendal mine currently in
development. The furnace would be built at
Jubilees Middelburg site and complement its own,
as well as the potential, operations with
Sylvania.
The
completion of ConRoasts development was announced
on the 2nd of June with 50,000 tonnes of PGM
concentrates smelted during its development
programme and confirmation that the process
outperforms traditional smelting methods for
chrome rich PGM concentrates. After the
announcement in May of its Middleburg site
acquisition, the company is now well advanced
with ConRoasts commercial implementation.
8 million
pounds was raised on the 10th of June by way of
the issue of 24,242,423 shares at a price of 33p
per share. Proceeds will be used to finance the
continued development and commercialisation of
Jubilee's ConRoast smelting capacity and process,
the purchase of a majority interest in an on-site
gas-powered generator at Middleburg, the
completion of the Tjate bankable feasibility
study and general working capital.
On
the 4th of May Jubilee announced that it has
secured a brownfield site for its first ConRoast
Furnace. An initial 70% interest in the
ferro-alloy smelting facility in Middelburg,
South Africa has been acquired for $10 million in
cash, with the remaining 30% under option (31st
December 2010 expiry) for $4 million in shares or
cash.
The
site currently hosts two 2.5 MVA (million volt
amperes) arc furnaces, and is in the process of
having two more arc furnaces constructed (5 MVA
and 2.5 MVA) at a total cost of ZAR14 million
(1.3 million pounds). ZAR5 million has already
been incurred with Jubilee to make a further
payment of up to ZAR9 million upon its
acquisition becoming effective.
Jubilee
will generate cash almost immediately from
Middleburgs current smelting facilities, and is
already evaluating tenders for the engineering,
construction and procurement of its first 5MW
ConRoast facility.
Providing
further support for the first commercial ConRoast
Furnace was news on the 2nd of June that Minteks
demonstration furnace had smelted its 50,000th
tonne of PGM (Platinum Group Metal) and in so
doing concluded the process development
programme. Mintek will continue to support
Jubilee in its commercialisation of ConRoast with
Jubilee chairman Colin Bird delighted that
Minteks work had demonstrated it (ConRoast)
is an environmentally friendlier, safer and more
efficient processing solution. While
Middleburgs acquisition is a very positive
development, the issue of 24 million shares
dilutes our valuation to 64p. However, with the
company set to generate near term cash flows, we
retain our buy recommendation. A
detailed note is imminent.
Kenmare Resources
With 95% of the companys shares being registered
to shareholders in the UK, and 96% of its shares
traded on the London Stock Exchange, the company
has decided to apply to have its Irish Stock
Exchange listing changed to an overseas company
with a secondary listing in Ireland and aims to
obtain a UK Nationality classification with the
FTSE so as to qualify for admission to the FSTE
UK index series. Kenmares headquarters will
remain in Ireland, but could result in increased
investment interest in the company through, for
example, UK index tracker funds. Irish
reclassification should become effective in early
August, with FSTE classification in
September.
A
Moma update on the 20th of May revealed that in
April the operation produced 57,307 tonnes of
ilmenite and 3,231 tonnes of zircon compared to
monthly averages in the first quarter of 2010 of
57,307 tonnes and 2,670 tonnes respectively.
Rutile production, marginal at the moment, should
significantly improve in the coming months after
the introduction of new separation equipment in
the circuit.
Work
on the projects 50% output expansion has
progressed to a stage where an owner’s team
has been appointed and supervising the completion
of the Definitive Engineering Study, the
appointment of an EPCM (Engineering Procurement
Construction Management) contractor and the
implementation of the expansion project.
Buy with target price of
20p.
Kibo Mining*/**/***
Drilling at the Luhala project in Northern
Tanzania commenced on the 6th of July with 12 RC
holes planned to be drilled to depths of between
60 and 150 meteres. The site is down dip of the
gold mineralisation at Kisunge Hill which, along
with Shilao South Hill and Shilao West Hill has a
combined JORC compliant resource of 111,900
ounces of gold.
On
the 25th of June Kibo released its interim
results for the 6 months to 31st March 2009.
While the companys public listing on the 27th of
April is an undoubted highlight post balance
sheet period, the 1.246 million pounds capital
raising was an important in balance sheet period
event facilitating its AIM admission. Going
forward important milestones include the
scheduled commencement of drilling at Luhala
(Kisunge prospect) in July, the commissioning a
detailed scoping study on the Itetemia project
ahead of further drilling on Golden Horseshoe
Reef (current JORC-compliant resource of 422,000
oz of gold at 3.1 g/t), the expected receipt of
licence renewals at Haneti and the commencement
of exploration surveys at the Morogoro project in
the next few months.
Financially
the companys 347,797 pounds in administration
costs (125,598 pounds in the 6 months to 31st
March 2009) drove the pre tax loss of 344,850
pounds (218,709 pounds ) and loss per share to
0.21p (0.20p). The company maintained its debt
free status and reported cash and cash
equivalents of 877,076 pounds (346,766 pounds )
as at 31st March 2010.
The
next 6-12 months is an important period for this
young company and one that will be critical for
its long term future. Speculative
buy recommendation retained.
Media Corp*/**
Media Corp has released satisfactory results for
the 6-months ended 31 March 2010, which marked
the group returning to profit. Purple Lounge,
acquired on 13 October 2009, has transformed
prospects for the Internet Advertising division
and prospects were further improved following
Googles decision to remove its search engine
listing penalty that has seen the relaunched
www.gambling.com return to pole
position. The Advertising Network
division’s revenues increased by 36% to
1.922 million pounds and returned to profit
(0.203 million pounds compared with a loss of
0.228 million pounds ) because of the continued
recovery in internet advertising.
The second half has started strongly with record
revenues being recorded during April. We remain
comfortable with our existing expectations
because internet advertising demand continues to
grow; www.gambling.com revenues are
still growing rapidly following the removal of
the Google penalty and are still a shadow of
their earlier levels; and Purple Lounge’s
is growing strongly because it is successfully
leveraging off the skill sets of the entire
group. Despite this expected return to profitably
supported by the groups specific improving
trading background, we have maintained our
earlier demanding but conservative expectations
(see note of 26 May 2010). Our stance remains
buy.
Metals Exploration
On the 23rd of July major shareholder Solomon
Capital Limited made a mandatory cash offer for
the remaining shares in Metals Exploration.
Owning 118,935,655 shares representing 44.10%,
Solomon offered to purchase the remaining shares
at 13p each and thus valuing the company at 35.76
million pounds. Solomon has always been
supportive of the company and intends to continue
to work with existing management to bring the
Runruno project into production. Metals
Exploration is yet to respond to the
offer.
Runrunos
long anticipated feasibility study was released
on the 4th of May together with a resource
update. The study revealed an economic project
producing 101,800 ounces of gold in the first 5
years and then 92,700 ounces in the following 5
years. Excluding the significant Molybdenum
credits (test work continues) the average
operating cost forecast is $477 per ounce of
gold, while the capital cost is expected to be
$149.3 million. 91.9% of gold is expected to be
recovered equating to 1,006,000 ounces over the
10 year initial mine life. The companys first
mining reserve was also announced with 540,000
ounces in the Proven category and 240,000 ounces
in the Probable category.
Annual
results for the 12 months to 31st December 2009
were announced on the 17th of May with the period
highlighted by the receipt of Runrunos FTAA
(Financial and Technical Assistance Agreement), a
resource estimate update, step out drilling
intersecting both gold and molybdenum and Solomon
Capital increasing its interest in Metals
Exploration to 44.1%. 2009 was a period of
rigorous box ticking for the company as it sought
to ensure every possible incident was catered for
and all regulatory requirements were achieved.
Financially Metals Exploration reported a pre-tax
loss of 4.3 million pounds, up from 0.5 million
pounds the previous year and primarily down to
increased staff costs (2.5 million pounds vs 0.3
million pounds) as the company moved from a
relatively small exploration workforce (average
employees 243) to a larger development one (655).
Consequently loss per share increased from 0.44p
to 1.87p. Net cash at 31st December 2009 was 3.4
million pounds compared to net debt of 1.3
million pounds a year earlier and an obvious
consequence of 14.9 million pounds having been
raised during the period. Recommendation and
target price withdrawn due to
presence of the takeover approach.
Minoan*/**/***
The company has released interim results for the
six months ended 31 March 2010 that were in line
with expectations. However, the companys value
potential remains tied up with Cavo Sidero
project where a court ruling is still
anticipated. Nevertheless, there is a growing
realisation throughout Government, its agencies
and the main Opposition party that Greece needs
foreign investment and further development of
tourism.
Minoan continues to progress with its
diversification to provide strong cashflow and
profit growth through the continued acquisition
of renewable energy licences following the
implementation of revised legislation and
expansion into tourism and leisure sector.
Mirada*/***
We initiated our coverage on 20th May with a
stance, at 21.5p, of buy.
Nighthawk Energy*
On the 28th of June Nighthawk announced that it
had acquired a 50% interest in the Hammond
project with long time partner Running Foxes
acquiring the other 50%. Hammond covers 4,773
acres in Bourbon County and is located adjacent
to the companys Buchanan and Worden leases in
Missouri. The 42 production wells will be managed
alongside those already producing within the
Revere group of projects, as well as the oil tank
storage batteries and pipelines also included in
the agreement.
The
ongoing marketing of the Jolly Ranch Project farm
out was confirmed in an announcement on the 23rd
of June with marketer Macquarie Tristone soon to
issue an Overview Memorandum detailing the farm
out terms and project economics. This release
follows that made on the 7th of June which
initially announced the Jolly Ranch farm out
decision. An update on the 26th of July announced
that 7 companies have signed confidentially
agreement to evaluate the information held in the
Jolly Ranch project data room, with this high
level of interest prompting the company to extend
the divestment process timetable.
Adding
to the attraction of Jolly Ranch was the
announcement on the 16th of June that Nighthawk
and Running Foxes had acquired an option
agreement over a licence area near the John Craig
7-2 wildcat well recently drilled on the Jolly
Ranch licence. The licence areas include Township
9 South, Range 56 West, Section 35 and Township
10 South, Range 56 West, Section 3 which covers
an area of 1,280 acres and held by Anadarko
E&P Company LP and Anadarko Land Corporation.
The option, expiring on the 1st of September
2010, is to commence drilling a First Option Test
Well at a location of their choice on the land
subject to the Agreement. Should the well(s) be
successful, Anadarko will receive a 20% royalty
from subsequent production.
On
the 2nd of June Nighthawk reported ongoing
drilling success at its Jolly Ranch project.
Target depths had been reached on both the Craig
6-4 and the Craig 16-32 development wells in the
Bolero field with significant hydrocarbons
encountered in several horizons in each well. The
John Craig 7-2 well was drilled near Limon and
reached target depth and also encountering
significant hydrocarbons. Subsequent to this
drilling, Nighthawk announced on the 7th of July
that Schlumberger Data & Consulting Services
completed its study of the Atoka and Cherokee
Shales over the Jolly Ranch project and concluded
that it has a high degree of confidence that the
shales are present under most, if not all of
Nighthawks acreage. A detailed note is imminent.
Buy with 230p target
price.
Northbridge Industrial
A trading update on the 14th June reported
progress being made particularly as the mix of
revenue is moving strongly towards the higher
margin rental / service revenue model. This is a
result of the substantial investment of 4.4
million pounds made in the hire fleet last year
and an additional 1.2 million pounds as
development investment into the acquired
compressor fleet, has helped to continued to
expand the load bank, transformer and generator
hire fleets. Then in July, Northbridge acquired a
specialist air compressor fleet based in the UK
from the manufacturer Sullair Corporation. The
specialist applications for these compressors
include pipeline dewatering and pressure testing
in the oil & gas industry. The cost of the
hire fleet was 1.2 million pounds of which 90%
was funded by a hire purchase agreement with
Lloyds Banking Group. The interims to June 2010,
to be announced in the week starting Monday 20th
September should report substantial growth in
profits and turnover compared with the interims
from the previous years. We would anticipate
further bolt-on acquisitions and the evidence is
that the management team are making the post
acquisition synergies work. The hiccup in sales
and earnings in 2009 due to the delayed contract
is resolved and will help accelerate the
comparative growth going forward. We think the
current historic PE ratio of 6.5 undervalues the
business opportunity and that a prospective PE of
8 would be more reasonable which gives a price
target of 220p. Buy.
Northern Petroleum*/***
Northern Petroleum released its annual results
for the 12 months to 31st December 2009 on the
8th of June with operations highlighted by the
increase in oil equivalent net proven and
probable reserves from 76.4 million to 102.9
million barrels, production increased from 367
barrels to 1,320 barrels of oil equivalent per
day (boepd), and the execution of two seismic
surveys which recorded 3,067 kilometres 2D data.
These surveys fed into a 1,520 square kilometre
3D survey recorded at the start of 2010.
Financially,
despite increasing production the company saw
revenue fall from 7.0 million Euro in the 12
months to 31st December 2008 to 5.1 million Euro
after the average price received per boe of gas
fell from 53.97 Euro to 33.45 Euro and of oil
from $90.44 to $56.43. This lower revenue when
combined with the absence of a profit on the sale
of assets and a 137% increase in administrative
expenses (from 1.9 million Euro to 4.5 million
Euro) resulted in a pre tax loss of 3.1 million
Euro compared to the 11.6 million Euro profit
recorded a year earlier. As a consequence, the
companys earnings per share of 14.1 cents in 2008
turned into a loss per share of 2.9 cents.
A
strategy to accelerate asset development was
announced on the 25th of June with new funds to
execute this plan to come from three sources; 1)
sale of non-core UK assets; 2) debt funding
secured against its production assets; and 3) a
placing to raise 10 million pounds. Envoi Limited
has been enlisted to handle the UK asset sale,
while Northern believes it is the right time to
increase its level of debt so as to provide
financial flexibility and for tax
efficiency.
On
the 28th of June Northern signed a strategic
seismic collaboration agreement with PGS Ventures
AS. The agreement includes three important
aspects, the first being the collaboration on the
design of geophysical programmes across
Northern's assets. Secondly, PGS will allow
Northern to view the seismic data in offshore
Italy and the Netherlands from some of its
clients, while the third is collaboration in
identifying potential new licences for
Northern.
A
response to proposals detailed in a posting on
the official Ministry of the Environment
web-site, attributed to Italian Environment
Minister Stefania Prestigiacomo was released on
the 2nd of July confirmed that they do not affect
Northern's reported reserves in Italy or its
exploration in the Southern Adriatic, and has
limited or no effect upon most other areas
including the West of Sicily Thrust Belt.
Prestigiacomo is looking to change the
legislation covering oil activities within five
nautical miles of the coastline and hydrocarbon
activities within twelve nautical miles of a
marine or coastal protected area. With the
majority of Northern's permits outside of this
boundary, there is little for the company to
worry about except in the Ionian Sea (not the
company’s most significant area) where the
proposals would rule out most of preliminary
awards d59F.R-.NP & d64F.R-.NP and have a
minor effect on d63F.R-.NP and d75F.R-.NP.
d77F.R-.NP would be unaffected.
Buy
with a 314p target price.
Pan African Resources***
On the 30th of June Pan African announced that,
after a two year drilling and underground
development programme at its Barberton Mines
subsidiary in South Africa, it has defined
several zones of mineralisation. A significant
ore-body named Royal Sheba has so far been
defined as containing 506,000 ounces of gold and
located below historical mine workings. Averaging
widths of between 5 and 25 metres, the ore body
becomes mineable 350 metres below the surface
(although some pillars exist higher) and
currently has an average grade of 2.97 g/t. The
ore-body remains open at depth (800 metres) and a
feasibility study will soon commence to assess
its economic potential. As a result of the Royal
Sheba discovery, the total mineral resource at
the mine has increased by 18% to 2.37 million
ounces (11.77Mt at 6.29g/t), measured and
indicated mineral resources increased by 30% to
1.81 million ounces (9.43Mt at 5.99g/t) and the
mineral reserve increased by 6.8% to 0.661
million ounces (2.31Mt at 8.87g/t).
As required under the JSE listing rules, Pan
African Resources confirmed that its expected GBP
earnings per share for the financial year to 30th
June 2010 will be between 148% and 158% higher
than those for the previous corresponding period
of 0.4p per share. South African Rand denominated
earnings per share is expected to be 106-116%
higher than the 5.74 cents per share reported in
2009.
On
the 20th of May Pan African released a resource
upgrade on it 100% owned Phoenix Platinum project
in the Bushveld Complex in South Africa. Total
PGM 4E’s (platinum, palladium, rhodium and
gold) increased from 405,000 ounces to 469,000
ounces comprising 321,000 ounces in the Measured
category, 63,000 ounces in the Indicated category
and 85,000 ounces in the Inferred
category.
Announced
on the 18th of May, having completed its
technical and financial due diligence on a
possible 25% stake in the RK1 Consortium, owner
of a chromite tailings retreatment plant at
Kroondal in the North West Province of South
Africa, Pan African elected not to proceed with
the transaction. On the 30th of June Pan African
announced that, after a two year drilling and
underground development programme at its
Barberton Mines subsidiary in South Africa, it
has defined several zones of mineralisation. A
significant ore-body named Royal Sheba has so far
been defined as containing 506,000 ounces of gold
and located below historical mine workings.
Averaging widths of between 5 and 25 metres, the
ore body becomes mineable 350 metres below the
surface (although some pillars exist higher) and
currently has an average grade of 2.97 g/t. The
ore-body remains open at depth (800 metres) and a
feasibility study will soon commence to assess
its economic potential. As a result of the Royal
Sheba discovery, the total mineral resource at
the mine has increased by 18% to 2.37 million
ounces (11.77Mt at 6.29g/t), measured and
indicated mineral resources increased by 30% to
1.81 million ounces (9.43Mt at 5.99g/t) and the
mineral reserve increased by 6.8% to 0.661
million ounces (2.31Mt at 8.87g/t).
As required under the JSE listing rules, Pan
African Resources confirmed that its expected GBP
earnings per share for the financial year to 30th
June 2010 will be between 148% and 158% higher
than those for the previous corresponding period
of 0.4p per share. South African Rand denominated
earnings per share is expected to be 106-116%
higher than the 5.74 cents per share reported in
2009.
On
the 20th of May Pan African released a resource
upgrade on it 100% owned Phoenix Platinum project
in the Bushveld Complex in South Africa. Total
PGM 4E’s (platinum, palladium, rhodium and
gold) increased from 405,000 ounces to 469,000
ounces comprising 321,000 ounces in the Measured
category, 63,000 ounces in the Indicated category
and 85,000 ounces in the Inferred
category.
On
the 18th of May, having completed its technical
and financial due diligence on a possible 25%
stake in the RK1 Consortium, owner of a chromite
tailings retreatment plant at Kroondal in the
North West Province of South Africa, Pan African
elected not to proceed with the
transaction.
PetroLatina Energy
Announcements on the 23rd and 30th of July
confirmed that Petrolatina has placed 14,871,972
shares at 37.57p each and 18,503,500 shares at
40p, raising $8.5 million and $11.5 million
respectively. Proceeds will be used to finance
the company's ongoing work in Colombia and for
general working capital purposes. However, the
company expects to raise additional money as it
looks to ramp up exploration and
development.
On
the 7th of June PetroLatina provided an update on
its La Paloma field where it has drilled the
Colon-3 well and installed electrical submersible
pumps in the Colon-1 and Colon-2 production
wells. Colon-3 was drilled to a depth of 10,000
feet (as per announcement on 1st July) one
kilometre south of the Colon-1. Having been
logged, cased and cemented petrophysical results
confirm the same oil bearing sand as Colon-1 and
2 and 3 oil bearing sand zones with a combined 27
feet of net oil pay. Meanwhile the pumps
installed at both Colon-1 and 2 are expected to
raise gross production from the two wells from
500 bopd (barrels of oil per day) to 1,200 bopd
once the pump rate has been optimised.
Petrolatina
was awarded blocks VMM28 and LLA57 in the Middle
Magdalena basin and Llanos basin respectively.
Announced on the 25th of June VMM28 covers
136,390 acres and is situated adjacent to the
companys La Paloma block; consequently
Petrolatina hopes to leverage its existing
operating capacity at La Paloma. LLA57 covers
105,760 acres and is located in an area that,
despite average field sizes of 1-10 million
barrels of recoverable oil, has experienced
commercial success rates in excess of 40%.
With
the two placings diluting shareholder interests,
we reduce our target price from 123.4p to 97p,
but retain our speculative buy
recommendation.
Pinnacle Telecom*
Pinnacle Telecom is an acquisitive AIM listed
provider of integrated telecommunications
solutions, specifically focused upon the huge UK
SME market, that is currently over half way
through its strategic repositioning, as outlined
by CEO Alan Bonner in June 2007. The group has
now been stabilised, returned to growth, and
reported a maiden operating profit (clean of
exceptional items) for the six months ended 31
March 2010.
Whilst the market for hosted business-to-business
telephony is still embryonic, Pinnacle’s
service offering has been steadily strengthened
and the Company is leading the market with its
hosted voice (VoIP) solution, which has been
fully endorsed and used extensively by the BBC,
most recently for this years General Election
coverage. In addition, the company has provided
similar virtual communications networks to some
of the UKs biggest outdoor festivals, such as the
Chelsea Flower Show, Donington Download,
Glastonbury and T in the Park, to name only a
few.
We believe that with the shares are undervalued
at 0.33p and have upside to 0.53p.
Plastics Capital
On 29 June, Plastics Capital, the AIM quoted
consolidator of plastics products manufacturers
released results in line expectations together
with an upbeat statement:The Board is
confident of another year of significant
progress. Nevertheless, we have maintained
our financial year 2011 pre-tax expectation at
3.125 million pounds and introduced an indication
for 2012 and continue to rate the shares a
buy (see note of 29 June
2010).
Polo Resources
The sale of Polos interest in Extract Resources
was announced on the 9th of July with Nippon
Uranium Resources Australia agreeing to pay A$7
for each of Polos 22,550,849 shares. The A$157.9
million sale is subject to approvals by Polos
shareholders and the Australian Foreign
Investment Review Board (received on the 16th of
July). On the same day, Polo confirmed that it
had received a non-binding indicative offer
letter from 4.04% shareholder Laxey Partners
Ltd.
On
the 24th of May Polo announced that it had
reached a memorandum of understanding (MOU) with
Peabody Energy Corporation and Winsway Coking
Coal Holdings for the sale of its 50% interest in
the Peabody-Polo Resources joint venture (JV) in
Mongolia. The JV held all of Polos coal and
uranium assets in Mongolia, but with priorities
elsewhere, Polo decided to divest itself of this
non-core holding. Winsway paid Polo (on the 27th
of May) a non-refundable deposit of $1.75 million
for an exclusive option to acquire the JV
interest by the 20th July 2010. This option was
taken up on the 30th of June with confirmation
that Winsway will pay Polo $13.25 million in cash
(total of $15 million) and a further $20 million
in cash or shares within 12 months. In addition
Polo will receive a 1% royalty from all coal
produced from the current JVs licences up to a
maximum of $50 million or out to 25 years.
The
termination of merger discussions between Polo
and Caledon Resources was announced on the 24th
of June after mutually agreeable terms could not
be reached. Polo remains a supporter of Caledon
and confirmed this by purchasing a further 11
million shares in the company at a price of 30p
per share.
The
cash windfall realised on the sale of its Extract
investment (anticipated sale at the time) and
Mongolian interests prompted Polo to announce on
the 2nd of July its intention to pay a special
dividend to shareholders of 3p per shares.
Long term buy.
RAM Investment Group*/***
The rapidly expanding Group reported finals which
can be summarised by headline losses of 1.85
million pounds on 0.4 million pounds turnover.
The consolidated figures include a 49% interest
in the TrainFX business for four months and RAM
Vision (the sum of two acquisitions) for two
months. The headline loss includes a prudent
impairment of share investments of 224,243 pounds
and a non-cash share option cost of 103,799
pounds. The two significant developments of last
year are the acquisition of 49.9% of TrainFX and
gaining board control with the option to acquire
the balance of the equity as well as the
establishment of a 100% owned subsidiary RAM
Vision. These two businesses are complementary
and form the base for expected growth over the
next few years. 2.5 million pounds was raised in
2009 and mainly invested in TFX and developing
its business with the balance for working
capital. Ram intends to raise sufficient for the
working capital including the capital expenditure
needed by Ram Vision to extend its screen network
and by TFX to commence the installation of
digital screens onto its first London commuter
rail line. We will be issuing forecasts
shortly.
Red Rock Resources***
A company update on the 29th of July provided
details of work at Migori, Columbia (covered in
earlier announcement), Jupiter Mines and Resource
Star. At Migori 378 line kilometres of helicopter
geophysical VTEM (versatile time-domain
electromagnetic system) have been flown along the
Macalder VMS mine strike zone with results
expected at the end of August. A fixed wing
magnetic/radiometric survey is also expected to
commence on the 16th of August and will cover the
whole license area (3,117 line kilometres), while
CSA Global will carry out a preliminary JORC
Resource estimate of the Macalder tailings and
the company will finalise a 5,000-10,000 metre
drill programme to begin in September.
As
for Jupiter, an RC drill programme of up to
11,000 metres began on the 20th of July and
targeting magnetic anomalies in the central area
of Mt Ida. Meanwhile sample results from 2,046
metres of RC drilling at tenement E45/2641
(Oakover Manganese Project) were received and
highlighted by 2 metres at 35.35% Mn from 17
metres in dept, 4 metres at 31.21% Mn from 33
metres, 4 metres at 26.89% Mn from surface and 6
metres at 25.02% Mn from 12 metres in
depth.
Finally,
Resource Stars earn in partner Globe Metals and
Mining has brought an RC drill rig on site to
begin a 1,500 metre programme at the Machinga
Rare Earth Project in Malawi. Four different
zones of heavy rare earth oxide (HREO) and
high-grade niobium mineralisation will be tested
in trenches at the Machinga North target. In
addition 270 line kilometres of helicopter
magnetics/radiometrics will be run in prospects
in northern Malawi.
On
the 10th of June Red Rock announced a Funding and
Co-operation Agreement Colombian company Mineras
Four Points SA (MFP), whereby Red Rock would
provide a $2 million loan to MFP. The loan
carries 5% interest, is repayable on the 30th of
June 2013 and is available in two $1 million
instalments. The loan will enable MFP to invest
in production and mining equipment at two gold
mines in Antioquia, Colombia. Red Rock has been
granted charges over the gold production of MFP
and over the existing issued share capital of
MFP.
At a
cost of $200,000 per quarter, rising to $300,000
per quarter Red Rock will also provide a minimum
of 20 days per month of consultancy and technical
support to MFP and provide a qualified
representative for the Operating Committee. This
consultancy agreement covers the 1st September
2010 until 30th June 2013, with a total of $2.96
million in fees payable.
Red
Rock will also have two options, the first is
exercisable for two years and allows Red Rock to
acquire 50% of MFPs issued capital for $6.5
million, while the second is exercisable for
three years to acquire 1% of MFP for $1
million.
MFP
is a Colombian company with exploration and
mining rights over the El Limon gold mine 6 km
south of Zaragoza in the province of Antioquia,
Colombia, and over the La Aurora gold mine 36 km
south of Zaragoza, Antioquia. El Limon has been
in production for in excess of 60 years, and is
currently producing ore with an average of 108
tonnes per month extracted in the January-May
2010 and average gold production of 15.3
kilogrammes per month. The new loan will enable
MFP to upgrade the mines surface plant and
increase its capacity to 150 tonnes of ore per
day.
35
hand-grab sample results from underground
workings by artisanal workers at the Macalder
Gossan (Migori gold project in Kenya) were
collected in April 2010 and the results released
on the 24th of June. 12 samples were in the range
of 1-5 g/t gold, 14 samples were in the range of
5-20 g/t and 1 sample returned 35.8 g/t gold.
With the ground unstable in places for drilling
equipment, systematic exploration remains an
outstanding question, but Red Rock believe the
body is worthy of further exploration effort and
may warrant a small open cut operation.
A
Migori exploration update on the 18th of May
announced that 200 hand grab samples spanning the
60 kilometre length of the greenstone belt
returned grades in excess of 50 g/t. 507 metres
of reverse circulation drilling was made in 11
holes across the SPL122 and SPL202 licence areas,
with the Gori Maria target returning the best
sample result of 24 metres averaging 1.29 g/t
gold from 10 metres in depth. Finally, samples
from 38 holes drilled at the Macalder
mine’s tailings dam averaged 1.56 g/t gold
and 16.78 g/t silver from the 191 metres in the
Sulphide zone and 1.85 g/t gold and 20g/t silver
from the 156 metres in the Calcine zone.
Speculative buy.
Resources In Insurance
Group*/**/***
Interims reported on the 29th of July showed a
35% increase in revenue to 0.925 million pounds
and a 51% reduction in losses to 150,466 pounds.
Resources in Insurance Group plc (RiIG),
previously the Claims People Group sold its Loss
Adjusting business in April 2009 it is now
concentrating on providing insourced and
outsourced support services to the insurance
industry and is working with most of the larger
players in the sector. RiIG has recently
refinanced itself via a convertible loan offering
and a 200,000 pounds fund raising. Having also
reduced its cost base by removing unprofitable
business, we believe that the company is on the
brink of profitability and, indeed, should book a
profit for the current financial year. Assuming a
PE ratio of 11 times 2011 earnings our target
price is 0.95p, buy.
ReThink Group*/***
ReThink, the rapidly expanding IT recruitment and
consulting business, released an upbeat AGM
statement of 15 June that reaffirmed the positive
outlook statement that accompanied the full year
results. Trading in the first four months of
current year was described as strong and the
company expects to meet market expectations. Our
stance remains buy with a target
price of 18p.
Sirius Exploration
On the 23rd of July Sirius released its annual
results for the 12 months to 31st March 2010. The
company raised 2.8 million pounds from
institutional investors, increased its intangible
assets from 1.2 million pounds to 54.3 million
pounds and created a US ADR facility and OTCQX
listing.
Operationally
Sirius acquired three potash and three technology
companies in the 12 months to 31st March 2010 as
well as upgrading its interest in Dakota Salts to
100%. Auspotash Corporation owns exploration
permits in Australia and Canada, Adavale Holdings
holds exploration permits adjacent to Auspotash
in Australia and Derby Salt Limited holds
exploration permits in the Kimberley region of
Western Australia, and CO2 Energy Storage Pty
Limited. CO2 Energy Storage Pty Limited, Bicarb
Sequestration Pty Limited and CO2 Energy Storage
Limited are all technology companies in the
storage/salt/potash industries with important
patent applications.
The
company also began research into compressed air
energy storage (CAES) and carbon sequestration in
North America, acquired an additional 1,000 acres
of lease areas adjacent to Dakota Salts existing
properties, and was awarded $225,000 by the
Industrial Commission of North Dakota under its
Renewable Energy Programme.
Financially
the company reported a pre-tax loss of 3.8
million pounds up from 0.5 million pounds in the
12 months to 31st March 2009, with the issue of
options (1.7 million pounds ), an impairment
charge (0.4 million pounds) and exploration costs
(0.4 million pounds) significant contributors.
Consequently, the loss per share doubled from
0.5p to 1p per share. The company had 1.78
million pounds in cash and equivalents and,
having paid off the 67,765 pounds borrowings from
2009, is now debt free.
Sirius
is focused on the rapid development of its potash
assets given the expected future supply shortfall
and lack of appropriate substitute. Beyond that
there are numerous options with energy storage and
thus GE&CR continues to recommend the company a
speculative buy.
Skywest Airlines*/***
Since we commented on Skywest Airlines (see note
of 26 July 2010) following the company’s
interim results in February, Western Australia's
largest regional airline has reported a further
five months of increased regular passenger
numbers. The company has additionally announced
it is to provide services under a further
scheduled charter deal, has leased another
aircraft and has extended the licence period for
the coastal network licence it operates. We
continue to believe that the shares at 18.5p are
substantially undervalued relative to our target
price of 32.5p and our stance remains
buy.
Third Quad Group*/**/***
A trading update from Third Quad Capital
(formerly Formjet PLC) published on 23rd June
reported a strong improvement in underlying
trading but, more critically, news of a very
significant distribution deal for the companys
Ability software products. DSG International
(Dixons/PC-World/ Currys-Digital) is shortly to
commence marketing a full suite of the products,
which are a lower cost but compatible alternative
to Microsoft Office. DSG customers will be
offered a complete purchase proposition of Norton
Internet Security and Ability Software in a
highly competitively priced package. This could
be a strategic break-through and lead to a
dramatic ramp up in sales and profitability
although we are only marginally adjusted our
forecasts.
The Ability business is now operating profitably
with positive cash-flow, and although the CEO
Andrew Monk, is now to be paid a salary (hitherto
he was working for 100 pounds a month) we have
marginally reduced the loss forecast for the
calendar 2010 year. We will quantify the profit
for 2011 as soon as we have a feel for
how fast this DSGI motorway channel to market is
flowing. The company has net cash and reports
that there is increased demand for commercial
property in the area around its headquarters
building in Crawley and that it is hopeful of
disposing of the site soon.
We estimate that TQCs tangible net assets are
worth at least 0.6p per share which limits the
downside risk while the upside, on the basis of
this announcement, is clear as Abilitys growth
drives Third Quad into profitability. On 12th
August Monk announced the purchase of VSA
Resources ( a broker which will allow Monk to
utilise his City skills) and Softline a business
complimentary to Ability. We publish a detailed
note on Third Quad following an imminent
management meeting.
Wren Extra Care Group
There has been no trading or financial news since
our last publication; however, Mr. Sidney Cordier
and Mr. Brian Wilson acting in concert have
acquired an aggregate shareholding of 2,416,667
shares representing 4.61% of the issued share
capital.
*This
company is a corporate client of Bishopsgate
Communications and/or Rivington Street Corporate
Finance which, in Rivington Street Holdings
(RSH), share a common ultimate owner with
GE&CR.
**RSH owns shares in this
company.
***Shares in this company are held in a fund
managed by t1ps Investment Management, which is
owned by RSH: for details of funds
email spiros.kurtidis@t1ps.com.
****This company owns shares in
RSH.
@UK
|
EPIC: ATUK
|
Share Price:
1.05p
|
Website: www.uk-plc.net
|
|
Market: AIM
|
Market Cap: 0.61 million
pounds
|
Sector: Software &
Computer Services
|
|
Year to 31st December
|
Sales
(000 pounds)
|
Pre-Tax Profits
(000 pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
2,330
|
(2,367)
|
(5.91)
|
NA
|
0.0
|
0.0
|
|
2008A
|
2,172
|
(1,522)
|
(3.46)
|
NA
|
0.0
|
0.0
|
|
2009A
|
2,295
|
(799)
|
(1.33)
|
NA
|
0.0
|
0.0
|
|
2010E
|
1,960
|
(650)
|
(0.77)
|
NA
|
0.0
|
0.0
|
|
2011E
|
2,060
|
(560)
|
(0.66)
|
NA
|
0.0
|
0.0
|
Access Intelligence***
|
EPIC: ACC
|
Share Price: 5.5p
|
Website: www.accessintelligence.com
|
|
Market: AIM
|
Market Cap: 14 million
pounds
|
Sector: Software
Technology
|
|
Year to 30th November
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
3.967
|
(4.566)
|
(4.18)
|
NA
|
0.0
|
0.0
|
|
2009A
|
5.772
|
520
|
0.27
|
20.4
|
0.0
|
0.0
|
|
2010E
|
9.100
|
1.350
|
0.35
|
15.7
|
0.0
|
0.0
|
|
2011E
|
10.700
|
1.950
|
0.46
|
12.0
|
0.0
|
0.0
|
Active Energy (formerly
Cinpart)*/**/***
|
EPIC: AEG (CINP)
|
Share Price:
6.125p
|
Website: www.cinpart.com
|
|
Market: AIM
|
Market Cap: 6.9 million
pounds
|
Sector: Electronic and
Electrical Equipment
|
|
Year to 31st December
|
Sales ( million pounds)
|
Pre-tax Profit (000 pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
2.03
|
(0.335)
|
(1.09)
|
NA
|
0
|
0.0
|
|
2009A
|
2.88
|
(1,176)
|
(1.76)
|
NA
|
0
|
0.0
|
|
2010E
|
7.00
|
(650)
|
(0.68)
|
NA
|
0
|
0.0
|
|
2011E
|
11.50
|
600
|
0.56
|
10.9
|
0
|
0.0
|
Adept Telecom**
|
EPIC: ADT
|
Share Price:
19.5p
|
Website: www.adept-telecom.co.uk
|
|
Market: AIM
|
Market Cap: 4.13 million
pounds
|
Sector:Telecommunications
|
|
Year to 31st March
|
Sales ( million pounds)
|
Underlying Pre-Tax Profit ( million
pounds)
|
Underlying Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
23.6
|
2.6
|
11.4
|
1.7
|
0
|
0.0
|
|
2009A
|
28.6
|
2.1
|
10.4
|
1.9
|
0
|
0.0
|
|
2010A
|
25.7
|
2.2
|
9.3
|
2.1
|
0
|
0.0
|
|
2011E
|
24.1
|
1.9
|
7.6
|
2.6
|
0
|
0.0
|
|
2012E
|
24.0
|
2.2
|
8.5
|
2.3
|
0
|
0.0
|
African Aura
|
EPIC: AAAM
|
Share Price: 82p
|
Website: www.africanaura.com
|
|
Market: AIM
|
Market Cap: 57.6 million
pounds
|
Sector: Mining
|
|
Year to 31st December
|
Sales ($million)
|
Pre-Tax Profits
($million)
|
Earnings Per Share($)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
0
|
(2.23)
|
0.048
|
25.6
|
0
|
0.0
|
|
2009A
|
1.18
|
(11.73)
|
(0.182)
|
NA
|
0
|
0.0
|
|
2010E
|
1.0
|
(6.0)
|
(0.085)
|
NA
|
0
|
0.0
|
|
2011E
|
1.0
|
(7.0)
|
(0.1)
|
NA
|
0
|
0.0
|
African Eagle
|
EPIC: AFE
|
Share Price:
4.25p
|
Website: www.africaneagle.co.uk
|
|
Market: AIM
|
Market Cap: 12.6 million
pounds
|
Sector: Mining
|
|
Year to 31st December
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(1.1)
|
(0.4)
|
NA
|
0
|
0.0
|
|
2008A
|
0
|
(5.5)
|
(2.6)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(1.2)
|
(0.5)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(6.0)
|
(2.0)
|
NA
|
0
|
0.0
|
Ambrian Capital****
|
EPIC: AMBR
|
Share Price: 23p
|
Website: www.ambrian.com
|
|
Market: AIM
|
Market Cap: 24.6 million
pounds
|
Sector:General
Financial
|
|
Year to 31st December
|
Sales ( million pounds)
|
Normalised Pre-Tax Profit ( million
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
10.64
|
0.59
|
0.44
|
52.3
|
1.75
|
7.6
|
|
2008A
|
9.64
|
(5.79)
|
(5.81)
|
NA
|
1.50
|
6.5
|
|
2009A
|
16.00
|
2.25
|
1.60
|
14.4
|
1.50
|
6.5
|
|
2010E
|
17.25
|
3.0
|
2.20
|
10.5
|
1.50
|
6.5
|
Amur Minerals
|
EPIC: AMC
|
Share Price: 5p
|
Website: www.amurminerals.com
|
|
Market: AIM
|
Market Cap: 10.5 million
pounds
|
Sector: Mining
|
|
Year to 31st December
|
Sales (US$ Million)
|
Pre-tax Profit (US$ Million)
|
Earnings Per Share (cents)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(2.0)
|
(2.1)
|
NA
|
0
|
0.0
|
|
2008A
|
0
|
(2.3)
|
(2.0)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(1.8)
|
(1.0)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(2.8)
|
(1.7)
|
NA
|
0
|
0.0
|
Angel Mining*/***
|
EPIC: ANGM
|
Share Price:
5.25p
|
Website: www.angelmining.com
|
|
Market: AIM
|
Market Cap: 16.7 million
pounds
|
Sector: Mining
|
|
Year to 28th Feb
|
Sales ( Million Pounds)
|
Pre-tax Profit ( Million Pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(4.37)
|
(3.16)
|
NA
|
0
|
0.0
|
|
2008A^
|
0
|
(4.26)
|
(2.97)
|
NA
|
0
|
0.0
|
|
2009E
|
0
|
(5)
|
(2.02)
|
NA
|
0
|
0.0
|
|
2010E
|
0.2
|
(6)
|
(2.43)
|
NA
|
0
|
0.0
|
^
year to 29th February
Ascot Mining**/***
|
EPIC: ASMP
|
Share Price:
19.5p
|
Website: www.ascotmining.com
|
|
Market: PLUS
|
Market Cap: 7.8 million
pounds
|
Sector: Gold
Mining
|
|
Year to 30th Sep
|
Sales
(million pounds)
|
Pre-tax Profit
million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(0.01)
|
(10.0)
|
NA
|
0
|
0.0
|
|
2008A
|
0.1
|
(0.78)
|
(3.93)
|
NA
|
0
|
0.0
|
|
2009A
|
0.0
|
(2.0)
|
(5.99)
|
NA
|
0
|
0.0
|
|
2010E
|
7.0
|
4.5
|
12.8
|
1.5
|
0
|
0.0
|
Avanti Communications***
|
EPIC: AVN
|
Share Price: 516p
|
Website: www.avantiplc.com
|
|
Market: AIM
|
Market Cap: 413.6
million pounds
|
Sector:Telecommunications
|
|
Year to 31st June
|
Sales ( million pounds)
|
Normalised Pre-Tax Profit (million
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
5.92
|
(1.47)
|
(5.3)
|
NA
|
0
|
0.0
|
|
2009A
|
8.04
|
(1.13)
|
(4.1)
|
NA
|
0
|
0.0
|
|
2010E
|
7.00
|
(1.25)
|
(2.4)
|
NA
|
0
|
0.0
|
Avation*
|
EPIC: AVAP
|
Share Price: 58p
|
Website: www.avation.com
|
|
Market: PLUS
|
Market Cap: 15.2 million
pounds
|
Sector:Diversified
Industrials
|
|
Year to 30th June
|
Sales ( million pounds)
|
Normalised Pre-Tax Profit ( million
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
1.81
|
0.78
|
3.0
|
19.3
|
0
|
0.0
|
|
2008A
|
5.03
|
2.64
|
6.0
|
9.7
|
1.0
|
1.7
|
|
2009A
|
16.28
|
4.98
|
10.4
|
5.6
|
1.0
|
1.7
|
Avisen*/***
|
EPIC: AVI
|
Share Price:
4.625p
|
Website: www.avisen.com
|
|
Market:AIM
|
Market Cap: 10.4 million
pounds
|
Sector:Software &
Computer Services
|
|
Year to 31st January
|
Sales ( 000 pounds)
|
Normalised Pre-Tax Profit (000
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A1
|
4,020
|
318
|
0.30
|
15.4
|
0
|
0.0
|
|
2009A2
|
2,773
|
(102)
|
(4.07)
|
NA
|
0
|
0.0
|
|
2010A3
|
7,165
|
(3,069)
|
(2.39)
|
NA
|
0
|
0.0
|
|
2011E3,4
|
14,000
|
(1,400)
|
0.636
|
7.3
|
0
|
0.0
|
-
12
months ended 31 March
-
2
10 months ended 31 January
-
3
12 months ended 31 January
-
4
Includes Xploite for 6 months
-
5
Based on number of shares in issue following
reverse takeover of Z Group plc
-
Based
on average number of shares in issue following
completion of Scheme of Arrangement for
actisition of Xploite plc
-
7
Total number of shares following Scheme of
Arrangeemnt for acquisition of Xploite plc will
be 225.27 million.
Blavod Wines & Spirits***
|
EPIC: BES
|
Share Price:
3.375p
|
Website: www.blavodextreme.com
|
|
Market: AIM
|
Market Cap: 3 million
pounds
|
Sector:Beverages
|
|
Year to 30th June
|
Sales ( million pounds)
|
Normalised Pre-Tax Profit (million
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2009A
|
6.0
|
0.13
|
0.14
|
24.1
|
0
|
0.0
|
|
2010A
|
8.3
|
(0.15)
|
0.0
|
NA
|
0
|
0.0
|
|
2011E
|
9.0
|
0.22
|
0.23
|
14.7
|
0
|
0.0
|
|
2012E
|
9.4
|
0.35
|
0.37
|
9.1
|
0
|
0.0
|
|
2013E
|
10.0
|
0.55
|
0.59
|
5.7
|
0
|
0.0
|
Character Group
|
EPIC: CCT
|
Share Price: 124p
|
Website:
www.thecharacter.com
|
|
Market: AIM
|
Market Cap: 32.7 million
pounds
|
Sector: Media/Retail
Distribution
|
|
Year to 31st August
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
68.6
|
-2.174
|
-4.14
|
NA
|
1.0
|
0.8
|
|
2010E
|
84.5
|
6.250
|
15.22
|
8.1
|
4.0
|
3.2
|
|
2011E
|
89.0
|
7.250
|
19.48
|
6.4
|
5.0
|
4.0
|
|
2012E
|
93.0
|
8.250
|
22.27
|
5.6
|
5.5
|
4.4
|
Design Capital*
|
EPIC: DESC
|
Share Price: 12p
|
Website:
www.designcapitalplc.com
|
|
Market: AIM
|
Market Cap: 37.2 million
pounds
|
Sector: Specialty
Finance
|
|
Year to 31st Dec
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
11.2
|
(3.2)
|
(6.5)
|
NA
|
0
|
0.0
|
|
2009E
|
10.0
|
(1.5)
|
(4.1)
|
NA
|
0
|
0.0
|
|
2010E
|
12.0
|
0.4
|
0.6
|
20
|
0
|
0.0
|
|
2011E
|
15.0
|
0.8
|
1.3
|
9.2
|
0
|
0.0
|
EMED Mining*/***
|
EPIC: EMED
|
Share Price: 10p
|
Website:
www.emed-mining.com
|
|
Market: AIM
|
Market Cap: 42.6 million
pounds
|
Sector: Mining
|
|
Year to 31st Dec
|
Sales ( million Euro)
|
Pre-tax Profit ( million Euro)
|
Earnings Per Share (cents)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(11.8)
|
(10)
|
NA
|
0
|
0.0
|
|
2008A
|
0
|
(17.1)
|
(8)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(10.4)
|
(3)
|
NA
|
0
|
0.0
|
|
2010E
|
10
|
(10)
|
(3.9)
|
NA
|
0
|
0.0
|
Empresaria***
|
EPIC: EMR
|
Share Price: 49p
|
Website: www.empresaria.com
|
|
Market: AIM
|
Market Cap: 21.8 million
pounds
|
Sector:
Recruitment
|
|
Year to 31st December
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2009A
|
190.5
|
3.8
|
5.4
|
9.1
|
0.35
|
0.7
|
|
2010E
|
219
|
5.9
|
6.2
|
7.9
|
0.35
|
0.7
|
|
2011E
|
231
|
6.45
|
7.1
|
6.9
|
0.35
|
0.7
|
|
2012E
|
252
|
7.85
|
9.1
|
5.4
|
0.35
|
0.7
|
Forbidden Technologies*/**/***
|
EPIC: FBT
|
Share Price:
20.5p
|
Website: www.forbidden.co.uk
|
|
Market: AIM
|
Market Cap: 16.6 million
pounds
|
Sector: Software &
Computer Services
|
|
Year to 31st December
|
Sales (000 pounds)
|
Pre-Tax Profits
(000 pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
121.2
|
(110.7)
|
(0.10)
|
NA
|
0
|
0.0
|
|
2009A
|
280.8
|
(92.9)
|
(0.07)
|
NA
|
0
|
0.0
|
|
2010E
|
600
|
27.0
|
0.03
|
683.3
|
0
|
0.0
|
|
2011E
|
1,200
|
310.0
|
0.39
|
52.6
|
0
|
0.0
|
Third Quad (formerly
Formjet)*/**/***
|
EPIC: TQC
|
Share Price:
0.45p
|
Website:
www.thirdquadcapital.com
|
|
Market: AIM
|
Market Cap: 1.8 million
pounds
|
Sector: Software &
Computer Services
|
|
Year to 31st December
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
3,663
|
(69)
|
(0.05)
|
0
|
0
|
0
|
|
2008A
|
3,592
|
(845)
|
(0.34)
|
0
|
0
|
0
|
|
2009A
|
1,823
|
(1,492)
|
(0.50)
|
0
|
0
|
0
|
|
2010E
|
1,250
|
(150)
|
(0.04)
|
0
|
0
|
0
|
Hambledon Mining***
|
EPIC: HMB
|
Share Price:
6.63p
|
Website: www.hambledon-mining.com
|
|
Market: AIM
|
Market Cap: 34.2 million
pounds
|
Sector: Mining
|
|
Year to 30th April
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
5.55
|
(7.06)
|
(1.65)
|
NA
|
0
|
0.0
|
|
2009A
|
12.81
|
(0.25)
|
0.01
|
663
|
0
|
0.0
|
|
2010E
|
26.30
|
11.00
|
2.10
|
3.2
|
0
|
0.0
|
|
2011E
|
39.20
|
17.23
|
2.30
|
2.9
|
0
|
0.0
|
|
2012E
|
76.00
|
41.00
|
5.60
|
1.2
|
0
|
0.0
|
Healthcare Enterprise
Group*/**/***
|
EPIC: HCEG
|
Share Price:
22.75p
|
Website: www.hcegroup.com
|
|
Market: AIM
|
Market Cap: 1.456
million pounds
|
Sector:
Healthcare
|
|
Year to 30th June
|
Revenue (000 pounds)
|
Pre-Tax Profits
(000 pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
793
|
(2,297)
|
(4.2)
|
NA
|
0
|
0.0
|
|
2009E
|
506
|
(1,491)
|
(0.5)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(750)
|
(0.2)
|
NA
|
0
|
0.0
|
Henderson Morley*
|
EPIC: HML
|
Share Price: 0.1p
|
Website: www.henderson-morley.com
|
|
Market: AIM
|
Market Cap: 1.4 million
pounds
|
Sector: Pharmaceutical
Biotechnology
|
|
Year to 30th April
|
Sales (000 pounds)
|
Pre-Tax Profits
(000 pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
19.3
|
(928.1)
|
(0.2)
|
NA
|
0
|
0.0
|
|
2008A
|
16.5
|
(1,304.5)
|
(0.2)
|
NA
|
0
|
0.0
|
|
2009A
|
80.0
|
(1,103.1)
|
(0.2)
|
NA
|
0
|
0.0
|
|
2010E
|
80.0
|
888.5
|
0.1
|
1.0
|
0
|
0.0
|
|
2011E
|
80.0
|
(1,108.6)
|
(0.1)
|
NA
|
0
|
0.0
|
ILX Group***
|
EPIC: ILX
|
Share Price: 25p
|
Website: www.ilxgroup.com
|
|
Market: AIM
|
Market Cap: 5.9 million
pounds
|
Sector: Support
Services
|
|
Year to 31st March
|
Sales
(million pounds)
|
Pre-Tax profit
(million pounds)
|
Earnings
Per Share (p)
|
Price
Earnings
Ratio
|
Dividend
(p)
|
Dividend
Yield (%)
|
|
2009A
|
15.6
|
1.7
|
6.0
|
4.2
|
1.5
|
6.0
|
|
2010A
|
14.7
|
1.1
|
3.75
|
6.7
|
1.5
|
6.0
|
|
2011A
|
15.0
|
1.4
|
4.28
|
5.8
|
1.5
|
6.0
|
|
2012E
|
16.2
|
1.9
|
5.89
|
4.2
|
1.5
|
6.0
|
Inland
|
EPIC: INL
|
Share Price: 18p
|
Website:
www.inlandplc.com
|
|
Market: AIM
|
Market Cap: 32.9 million
pounds
|
Sector: Real
Estate
|
|
Year to 30th June
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Year End NAV
|
Dividend Yield (%)
|
|
2008A*
|
11.006
|
(4.189)
|
(0.56)
|
N/A
|
32.8
|
0
|
|
2009A*
|
5.219
|
(10.467)
|
(3.15)
|
N/A
|
24.9
|
0
|
|
2010E#
|
7.726
|
(0.314)
|
(0.18)
|
N/A
|
24.1
|
0
|
|
2011E
|
14.800
|
5.000
|
2.00
|
9.0
|
26.1
|
0
|
#
Before exceptional items
Intandem Films*/**/***
|
EPIC: IFM
|
Share Price:
3.88p
|
Website: www.intandemfilms.com
|
|
Market: AIM
|
Market Cap: 4.1 million
pounds
|
Sector: Media
|
|
Year to 30th June
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Year End NAV
|
Dividend Yield (%)
|
|
2008A
|
1.17
|
(1.38)
|
(1.66)
|
NA
|
0
|
0
|
|
2009A
|
0.62
|
(1.91)
|
(2.29)
|
NA
|
0
|
0
|
|
2010E#
|
1.2
|
(0.3)
|
(0.35)
|
NA
|
0
|
0
|
|
2011E##
|
1.6
|
0.5
|
0.57
|
7.2
|
0
|
0
|
#
2010 Pre-exceptional and excluding the $6.5m
(£4.2m) non-cash profit.
## 2011 Tax charge nil.
Intellego */**
|
EPIC: IHP
|
Share Price:
0.23p
|
Website:
www.intellego.co.uk
|
|
Market: AIM
|
Market Cap: 0.6 million
pounds
|
Sector: Support
Services
|
|
Year to 31st March
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividend
(p)
|
Dividend Yield (%)
|
|
2007A
|
1.1
|
(0.3)
|
(0.3)
|
N/A
|
0
|
0
|
|
2008A
|
1.7
|
(0.4)
|
(0.3)
|
N/A
|
0
|
0
|
|
2009A
|
2.3
|
(0.1)
|
(0.4)
|
N/A
|
0
|
0
|
|
2010E
|
3.0
|
0.4
|
0.2
|
1.2
|
0
|
0
|
IQ Holdings*/**/***
|
EPIC: IQH
|
Share Price:
0.07p
|
Website: www.iqresearch.co.uk
|
|
Market: AIM
|
Market Cap: 1.3 million
pounds
|
Sector:
Investment
Company
|
|
Year to 30th September
|
Sales
(million pounds)
|
Pre-Tax profit
(million pounds)
|
Earnings
Per Share (p)
|
Price
Earnings
Ratio
|
Dividend
(p)
|
Dividend
Yield (%)
|
|
2007A
|
0.42
|
(0.16)
|
(1.71)
|
NA
|
0.0
|
0.0
|
|
2008A
|
0.90
|
(0.54)
|
(0.71)
|
NA
|
0.0
|
0.0
|
|
2009A
|
0.00
|
(0.22)
|
(0.08)
|
NA
|
0.0
|
0.0
|
Jubilee Platinum*/***
|
EPIC: JLP
|
Share Price:
27.5p
|
Website: www.jubileeplatinum.com
|
|
Market: AIM
|
Market Cap: 70 million
pounds
|
Sector: Mining
Resources
|
|
Year to 30th June
|
Sales ( million pounds)
|
Pre-tax Profit (million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(1.75)
|
(1.55)
|
NA
|
0
|
0.0
|
|
2008A
|
0
|
(4.08)
|
(3.45)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(4.08)
|
(3.50)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(2.5)
|
(2.21)
|
NA
|
0
|
0.0
|
Kenmare Resources
|
EPIC: KMR
|
Share Price:
15.75p
|
Website: www.kenmareresources.com
|
|
Market: AIM
|
Market Cap: 378.6
million pounds
|
Sector:Resources
|
|
Year to 31st Dec
|
Sales ($ Million)
|
Pre-tax Profit ($ Million)
|
Earnings Per Share (c)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
0
|
0.35
|
0.045
|
525
|
0
|
0.0
|
|
2009A
|
26.7
|
(30.4)
|
(3.59)
|
NA
|
0
|
0.0
|
|
2010E
|
80.0
|
40.0
|
1.66
|
14.2
|
0
|
0.0
|
|
2011E
|
130.0
|
70.0
|
2.91
|
8.1
|
0
|
0.0
|
Kibo Mining*/**/***
|
EPIC: KIBO
|
Share Price: 2p
|
Website: www.kibomining.com
|
|
Market: AIM
|
Market Cap: 5.1 million
pounds
|
Sector:Mining
|
Media Corp */**
|
EPIC: MDC
|
Share Price: 2.9p
|
Website: www.mediacorpplc.com
|
|
Market: AIM
|
Market Cap: 9.7 million
pounds
|
Sector: Media
|
|
Year to 30th April
|
Sales (000 pounds)
|
Pre-Tax Profits
(000 pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
8,309
|
3,019
|
1.0
|
2.9
|
0
|
0.0
|
|
2008A
|
3,912
|
(11,222)
|
(3.9)
|
NA
|
0
|
0.0
|
|
2009A
|
3,507
|
(2,632)
|
(0.9)
|
NA
|
0
|
0.0
|
|
2010E
|
30,000
|
1,170
|
0.4
|
7.3
|
0
|
0.0
|
|
2011E
|
50,000
|
2,750
|
1.0
|
2.9
|
0
|
0.0
|
Metals Exploration
|
EPIC: MTL
|
Share Price: 13p
|
Website: www.metalsexploration.com
|
|
Market: AIM
|
Market Cap: 35.1 million
pounds
|
Sector:Resources
|
|
Year to 31st Dec
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A#
|
0
|
(3.3)
|
(1.24)
|
NA
|
0
|
0.0
|
|
2008A^
|
0
|
(0.5)
|
(0.44)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(4.3)
|
(1.87)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(4.0)
|
(1.50)
|
NA
|
0
|
0.0
|
# 12
months to 30th September
^ 3 months
Minoan**/***
|
EPIC: MIN
|
Share Price:
10.5p
|
Website:.www.minoangroup.com
|
|
Market: AIM
|
Market Cap: 7.9 million
pounds
|
Sector: Travel &
Leisure
|
|
Year to 30th September
|
Sales ( million pounds)
|
Normalised Pre-Tax Profit ( million
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2007A^
|
0
|
(0.85)
|
(2.23)
|
NA
|
0
|
0.0
|
|
2008A+
|
0
|
(1.32)
|
(2.64)
|
NA
|
0
|
0.0
|
|
2009E
|
0
|
(0.50)
|
(0.92)
|
NA
|
0
|
0.0
|
^ To
31st March
+ 18 months
Nighthawk Energy*
|
EPIC: HAWK
|
Share Price: 25p
|
Website: www.nighthawkenergy.com
|
|
Market: AIM
|
Market Cap: 82.4 million
pounds
|
Sector:Oil & Gas
Producers
|
|
Year to 30th Jun
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0.13
|
(1.48)
|
(1.31)
|
NA
|
0
|
0.0
|
|
2008A
|
0.14
|
(2.49)
|
(1.34)
|
NA
|
0
|
0.0
|
|
2009A
|
0.50
|
(1.69)
|
(0.72)
|
NA
|
0
|
0.0
|
Northbridge Industrial
|
EPIC: NBI
|
Share Price:
150.5p
|
Website: www.northbridgegroup.co.uk
|
|
Market: AIM
|
Market Cap: 23
million pounds
|
Sector:Industrial
Engineering
|
|
Year to 31st December
|
Sales ( million pounds)
|
Pre-tax Profit (000 pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2008A*
|
157.3
|
2,967
|
25.28
|
6.0
|
3.9
|
2.6
|
|
2009A*
|
127.2
|
2,211
|
19.98
|
7.5
|
4.1
|
2.7
|
|
2010E
|
155.0
|
3,200
|
25.4
|
5.9
|
4.5
|
3.0
|
|
2011E
|
167.5
|
3,400
|
27.5
|
5.5
|
5.25
|
3.5
|
Northern Petroleum*/***
|
EPIC: NOP
|
Share Price:
93.5p
|
Website: www.northpet.com
|
|
Market: AIM
|
Market Cap: 85.9 million
pounds
|
Sector:Oil &
Gas
|
|
Year to 31st Dec
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
5.9
|
30.0
|
29.7
|
3.1
|
0
|
0.0
|
|
2008A
|
7.0
|
11.6
|
14.1
|
6.6
|
0
|
0.0
|
|
2009A
|
5.1
|
(3.1)
|
(2.9)
|
NA
|
0
|
0.0
|
Pan African Resources***
|
EPIC: PAF
|
Share Price:
6.15p
|
Website: www.panafricanresources.com
|
|
Market: AIM
|
Market Cap: 86.7 million
pounds
|
Sector: Mining
|
|
Year to 30th June
|
Sales ( million pounds)
|
Normalised Pre-Tax Profit (million
pounds)
|
Normalised Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
26.7
|
3.95
|
0.35
|
17.6
|
0
|
0.0
|
|
2008A
|
39.2
|
11.95
|
0.52
|
11.8
|
0
|
0.0
|
|
2009A
|
53.0
|
16.31
|
0.4
|
15.4
|
0.2555
|
4.2
|
|
2010E
|
68.0
|
24.0
|
1.20
|
5.1
|
0.275
|
4.5
|
|
2011E
|
78.0
|
29.5
|
1.50
|
4.1
|
0.325
|
5.3
|
PetroLatina Energy
|
EPIC: PELE
|
Share Price:
52.25p
|
Website: www.petrolatinaenergy.com
|
|
Market: AIM
|
Market Cap: 42.2 million
pounds
|
Sector: Oil &
Gas
|
|
Year to 31st Dec
|
Sales ($ Million)
|
Pre-tax Profit ($ Million)
|
Earnings Per Share ($)
|
Price Earnings Ratio
|
Dividend Per Share (cents)
|
Dividend Yield (%)
|
|
2007A
|
7.1
|
(8.4)
|
(0.35)
|
NA
|
0
|
0.0
|
|
2008A
|
7.8
|
(4.0)
|
(0.12)
|
NA
|
0
|
0.0
|
|
2009A
|
13.8
|
(12.8)
|
(0.28)
|
9.3
|
0
|
0.0
|
|
2010E
|
55.0
|
16.0
|
0.26
|
3.6
|
0
|
0.0
|
Pinnacle Telecom*
|
EPIC: PINN
|
Share Price:
0.33p
|
Website:
www.pinnacletelecomgroup.co.uk
|
|
Market: AIM
|
Market Cap: 5.7 million
pounds
|
Sector: Software &
Computer Services
|
|
Year to 30th September
|
Sales (000 pounds)
|
Pre-tax Profit (000 pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
1,015
|
(2,583)
|
(0.46)
|
NA
|
0
|
0.0
|
|
2008A
|
1,495
|
(1,067)
|
(0.09)
|
NA
|
0
|
0.0
|
|
2009A
|
3,192
|
(895)
|
(0.07)
|
NA
|
0
|
0.0
|
|
2010E
|
6,400
|
(266)
|
(0.02)
|
NA
|
0
|
0.0
|
|
2011E
|
8,500
|
(84)
|
(0.01)
|
NA
|
0
|
0.0
|
Plastics Capital
|
EPIC: PLA
|
Share Price:
37.5p
|
Website:
www.plasticascapital.com
|
|
Market: AIM
|
Market Cap: 10.1 million
pounds
|
Sector: Chemicals
|
|
Year to 31st March
|
Sales (000 pounds)
|
Pre-tax Profit (000 pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
20,128
|
2,349
|
10.54
|
3.6
|
0
|
0.0
|
|
2009A
|
28.185
|
1,130
|
3.03
|
12.4
|
0
|
0.0
|
|
2010A
|
26,688
|
2,635
|
7.04
|
5.3
|
0
|
0.0
|
|
2011E
|
29,000
|
3,125
|
8.35
|
4.5
|
0
|
0.0
|
|
2012E
|
32,000
|
4,000
|
10.69
|
3.5
|
0
|
0.0
|
Polo Resources
|
EPIC: PRL
|
Share Price: 6.3p
|
Website: www.poloresources.com
|
|
Market: AIM
|
Market Cap: 152 million
pounds
|
Sector: Resources
|
|
Year to 30th June
|
Sales ($ Million)
|
Pre-tax Profit ($ Million)
|
Earnings Per Share (cents)
|
Price Earnings Ratio
|
Dividends Per Share (cents)
|
Dividend Yield (%)
|
|
2008A^
|
0
|
(6.7)
|
(1.12)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(62.7)
|
(3.20)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(8.0)
|
(0.37)
|
NA
|
0
|
0.0
|
^
23rd May 2007 to 30th June 2008
RAM Investments*/***
|
EPIC: RRR
|
Share Price:
4.25p
|
Website:www.raminvestmentgroup.co.uk
|
|
Market: AIM
|
Market Cap: 4.7 million
pounds
|
Sector:Media
|
Red Rock Resources***
|
EPIC: RRR
|
Share Price:
2.45p
|
Website: www.rrrplc.com
|
|
Market: AIM
|
Market Cap: 14.7 million
pounds
|
Sector:Mining
|
|
Year to 30th Jun
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(0.22)
|
(0.12)
|
NA
|
0
|
0.0
|
|
2008A
|
1.3
|
(0.15)
|
(0.06)
|
NA
|
0
|
0.0
|
|
2009A
|
0.06
|
(0.9)
|
(0.24)
|
NA
|
0
|
0.0
|
|
2010E
|
2.0
|
0.8
|
0.12
|
20.4
|
0.05
|
2.0
|
Resources In Insurance
Group*/**/***
|
EPIC: RIIG
|
Share Price: 0.5p
|
Website:
www.riig.co.uk
|
|
Market: AIM
|
Market Cap: 0.9 million
pounds
|
Sector: Support
Services
|
|
Year to 31st December
|
Sales ( million pounds)
|
Pre-Tax Profit (000 pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A*
|
1.1
|
(1,100)
|
(0.97)
|
NA
|
0
|
0.0
|
|
2009E*
|
1.5
|
(509)
|
(0.4)
|
NA
|
0
|
0.0
|
|
2010E
|
2.0
|
10
|
0.01
|
50
|
0
|
0.0
|
|
2011E
|
2.5
|
118
|
0.086
|
5.8
|
0
|
0.0
|
ReThink Group*/***
|
EPIC: RTG
|
Share Price:
5.25p
|
Website: www.therethinkgroup.com
|
|
Market: AIM
|
Market Cap: 4.9 million
pounds
|
Sector: IT Recruitment
& IT Consulting
|
|
Year to 31st December
|
Sales ( million pounds)
|
Pre-Tax Profit ( million pounds)
|
Undiluted Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
43.4
|
0.19
|
0.09
|
58.3
|
0
|
0.0
|
|
2009A
|
49.7
|
0.3
|
0.24
|
21.9
|
0
|
0.0
|
|
2010E
|
56.0
|
1.2
|
0.93
|
5.6
|
0
|
0.0
|
|
2011E
|
67.0
|
1.7
|
1.70
|
3.1
|
0
|
0.0
|
Sirius Exploration
|
EPIC: SXX
|
Share Price:
2.25p
|
Website: www.siriusexploration.com
|
|
Market: AIM
|
Market Cap: 14.9 million
pounds
|
Sector:Resources
|
|
Year to 31st Mar
|
Sales ( million pounds)
|
Pre-tax Profit ( million pounds)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
0
|
(0.28)
|
(0.3)
|
NA
|
0
|
0.0
|
|
2008A
|
0
|
(0.68)
|
(0.7)
|
NA
|
0
|
0.0
|
|
2009A
|
0
|
(0.5)
|
(0.5)
|
NA
|
0
|
0.0
|
|
2010A
|
0
|
(3.8)
|
(1.0)
|
NA
|
0
|
0.0
|
Skywest Airlines*/***
|
EPIC: SKYW
|
Share Price: 18p
|
Website: www.skywest.com.sg
|
|
Market: AIM
|
Market Cap: 35.9 million
pounds
|
Sector: Travel &
Leisure
|
|
Year to 30th June
|
Sales (S$ million)
|
Pre-Tax Profit (S$ million)
|
Earnings Per Share (p)
|
Price Earnings Ratio
|
Dividend Per Share (p)
|
Dividend Yield (%)
|
|
2008A
|
184.20
|
12.75
|
1.97
|
13.7
|
0.60
|
2.2
|
|
2009A
|
180.85
|
5.14
|
0.68
|
39.7
|
0.43
|
1.6
|
|
2010E
|
220.00
|
21.00
|
3.25
|
8.3
|
0.7
|
2.6
|
Third Quad (formerly
Formjet)*/**/***
|
EPIC: TQC
|
Share Price:
0.45p
|
Website:
www.thirdquadcapital.com
|
|
Market: AIM
|
Market Cap: 1.8 million
pounds
|
Sector: Software &
Computer Services
|
|
Year to 31st December
|
Sales (000 pounds)
|
Pre-Tax Profits
(000 pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
3,663
|
(69)
|
(0.05)
|
0
|
0
|
0
|
|
2008A
|
3,592
|
(845)
|
(0.34)
|
0
|
0
|
0
|
|
2009A
|
1,823
|
(1,492)
|
(0.50)
|
0
|
0
|
0
|
|
2010E
|
SUSP
|
SUSP
|
SUSP
|
SUSP
|
SUSP
|
SUSP
|
Wren Extra Care Group
|
EPIC: WREN
|
Share Price:
4.75p
|
Website: www.wrenhomesplc.co.uk
|
|
Market: AIM
|
Market Cap: 2.5 million
pounds
|
Sector: Real
Estate
|
|
Year to 31st December
|
Sales (million pounds)
|
Pre-Tax Profits
(million pounds)
|
Earnings Per Share(p)
|
Price Earnings Ratio
|
Dividends Per Share (p)
|
Dividend Yield (%)
|
|
2007A
|
2.22
|
0.76
|
1.4
|
3.4
|
0.6
|
12.6
|
|
2008A
|
0.08
|
(1.12)
|
(2.3)
|
NA
|
0.2
|
4.2
|
|
2009E
|
0.22
|
(0.95)
|
(1.9)
|
NA
|
0
|
0.0
|
|
2010E
|
0
|
(1.40)
|
(1.9)
|
NA
|
0
|
0.0
|
|
2011E
|
4.0
|
2.20
|
2.9
|
1.6
|
0
|
0.0
|
|
2012E
|
9.0
|
6.70
|
8.9
|
0.5
|
0
|
0.0
|
|
