reports
- Sarah Godfrey
UK REITs: Building back better
UK commercial property has been a cornerstone asset for many income-seeking investors (both retail and institutional) in recent decades, particularly since the global financial crisis of 2007/8 and the resulting ultra-low interest rate environment. However, since rates began to rise in 2022 to tackle surging inflation, meaningful returns have once more become available on lower-risk assets such as cash and government bonds, which has led to a retrenchment from alternative income assets such as p...
- Colin Smith
Avacta Group - FY23 results, Chris Coughlin appointed CEO
Avacta reported results for FY23 but more importantly announced the appointment of Christina Coughlin as CEO wef 1 May, replacing Alastair Smith who is stepping down today. FY23 results were better than consensus at the EPS level. Net cash ended the year at £16.6m, as previously disclosed, which has since been bolstered by the £31m gross equity raise enabling Avacta to fund the AVA6000 programme through Phase 2 clinical trials, as well as advancing other candidates in its pre|CISION™ and Affime...
- Colin Smith
Seplat Energy: 1Q24 results - operations strong, financials skewed
Seplat delivered an encouraging operating performance in 1Q24 including production of 49.3kboed, towards the upper end of guidance (44-52kboed). All current guidance was maintained but good progress on the ANOH export infrastructure and an earlier than expected resumption of exports through Zone 6 of the Trans Niger Pipeline improve confidence that guidance will be at least met. Financial performance for the quarter was skewed by a substantial underlift, FX effects, and a high deferred tax charg...
- Colin Smith
Vianet Group: FY24 trading update, strategic contract win
Vianet has published a positive trading update for FY24 with turnover up 7.6% to £15.18m, a 3.5 percentage point increase in gross margin YoY, and adjusted EBITA ahead of market expectations. Net debt continues to fall and closed FY24 at £1.52m (£2.1m at 30 September 2023), demonstrating strong free cash flow generation, even without the benefit of the £0.9m tax receipt received in 1H24, which augers well for a final dividend. The company reported a new contract with Wilcomatic Wash Systems, the...
- Colin Smith
Alphawave Semi - FY23 results, 1Q24 trading update
Following the updated guidance published last week, Alphawave reported a 74% YoY increase in revenue to US$321.7m for FY23 generating adjusted EBITDA of US$62.6m, up 34% YoY. As previewed, bookings in 1Q24 were strong at US$117.9m, up 20% YoY and ahead of guidance. The results release and conference call confirm that revised guidance mainly reflects a more conservative approach to revenue recognition under new CFO, Rahul Mathur, and an acceleration in the pace at which Alphawave is pivoting away...
- Colin Smith
Alphawave Semi: FY23 trading update, amended forward guidance
Alphawave Semi has reduced guidance for FY23 and prospectively citing lower revenues from China, changes in expected revenue recognition from long-term contracts, and continuing investment in R&D. The share price has reacted negatively, giving up most of the gains since the trading statement at the end of January. Current consensus, which is a good match for pre-existing guidance, should be reduced, most likely following release of the FY23 results and full 1Q24 trading update due on 23 April. H...
- Colin Smith
NextSource Materials - Initiation
NextSource is uniquely positioned to build a leading vertically integrated position, ex China, in the supply of Lithium-ion battery anode material which is essential for the Energy Transition. The company is commissioning phase 1 of its world-class Molo graphite mine in Madagascar and is in the final permitting process for its first Battery Anode Facility (BAF) to be located in Mauritius. The company is backed by Vision Blue, established by Sir Mick Davis, former CEO of Xstrata. On our calculat...
- Colin Smith
Avacta Group - AACR update
As pre-announced, Avacta has presented the results of the 3-weekly P1 Arm 1 study of its AVA6000 lead clinical asset, based on the pre|CISION™ drug development platform at the American Association for Cancer Research's annual general meeting. The update does not cover progress on the ongoing 2-weekly dosing study which is underway, and Avacta confirmed current guidance on timing including being on track to begin the dose expansion study in 2H24. There are compelling updates on the progress repor...
- Colin Smith
Craneware Group: Initiation – In the sweetspot
Craneware is the market leader in value cycle SaaS provision in the US with a 40% market penetration and the ambition to become ubiquitous in US hospitals. The shackles of Covid disruption, digestion of the Sentry acquisition, and the transitioning of its customers to the fully cloud based Trisus platform, have fallen away and opened up new sales opportunities for the group. While the shares have out-performed strongly, multiples look reasonable compared with peers. We calculate a DCF based fair...
- Sarah Godfrey
BlackRock Frontiers Investment Trust - Flying the flag for developing ...
BlackRock Frontiers posted another year of strong returns in FY23 (ended 30 September) and has continued to outperform into 2024, with NAV and share price total returns over one, three, five and 10 years to end-January 2024 comfortably beating the average of its peers in the AIC Global Emerging Markets sector. The trust offers a highly differentiated proposition, avoiding the eight largest emerging markets, which between them tend to account for around 90% of GEM investment. Instead, co-managers...
- Colin Smith
Trustpilot - FY23 results – Consensus beat, confirms momentum
Trustpilot delivered an excellent set of results for FY23. The company beat already increased expectations for adjusted EBITDA, reported its first ever net profit and was powerfully net cash generative. That was driven by a strong performance in operating metrics, a bounce back in the growth rate of bookings and other customer metrics, together with a greater focus on delivering bottom line performance. To date, the company has completed more than half of the £20m share buyback which commenced i...
- Colin Smith
Galliford Try - Excellent 1HFY24 results - strong momentum
Galliford Try has published an excellent set of results for the half to end December 2023 demonstrating strong momentum and continuing growth. Revenue jumped 21% YoY to £819m while the divisional operating margin improved to 2.5% (1HFY23 2.3%) driving a 33% increase in underlying profit before tax to £15.6m. Management underscored confidence in the sustainability of the results with a 33% hike in the interim dividend to 4.0p. Despite the strength of the performance, management did not raise guid...
- Colin Smith
Seplat Energy - FY23 results – strong performance, more to come
Seplat delivered a strong operating and financial performance in 2023 with production up 8% to 47.8kboed and EPS increased by 27% to US$0.14, despite a near 20% fall in the oil price. Reserves increased by 9% to 478mmboe. Guidance for start-up at ANOH was reconfirmed and Seplat remains highly confident that the transformational MPNU acquisition will complete. Cash flow was strong and net debt was reduced to US$306m (YE22 US$366m). The current quarterly dividend of USc3 was supplemented with a sp...
- Colin Smith
Avacta Group - £33m raise to progress drug pipeline
Avacta has announced an equity raise for up to £26.8m, since increased to £32.5m on strong demand. The funds raised are to progress the drug development pipeline, primarily for Avacta's lead clinical asset AVA6000, where the company anticipates a potential start of the expansion cohorts in several orphan diseases in 2H24 followed by the Phase 2 study, consistent with previous guidance. Avacta has also confirmed its intention to divest its Diagnostics division in a manner which maximises benefit ...
- Colin Smith
Galliford Try - Consensus forecasts increased, post positive trading s...
Galliford Try published a positive trading statement for 1HFY24 on 17 January 2024 which included guidance that revenue and pre-exceptional profit before tax (Adjusted PBT) for FY24 would be c5% ahead of then market expectations. That prompted four of the five covering brokers to revise their forecasts including one additional broker extending forecasts through FY26. On average, revenue forecasts increased by 3.9% for FY24 with estimates for adjusted PBT increasing by 4.9% and estimates for EPS ...
- Colin Smith
Diaceutics | FY23 update – 22% revenue growth, £16.7m YE cash
Diaceutics has released a trading statement for the year to December 2023 guiding to revenue growth of 22% YoY to £23.7m, up 19% on a constant currency basis. The order book jumped 57% to £26.6m, of which c£12.3m is expected to be realised in FY24, and which currently stands at £30.8m. The proportion of recurring revenue continues to increase and is now over 50% (FY22 35%). Cash at YE23 stood at £16.7m, indicating a near halving of the rate of cash burn in 2H23 compared to 1H23. We adjust our FY...
- Colin Smith
Alphawave Semi: 4Q23 trading update – FY23 guidance reiterated
Alphawave Semi has published its 4Q23 trading and business update, reiterating its guidance for FY23 with multiple new wins, a strong pipeline and good progress toward generating revenue from its Connectivity Products Group in 2024. Total new bookings of US$128.7m in 4Q23 were a record and increased by 36% YoY. Alphawave Semi continues to transition the company following the acquisitions in 2022, re-focusing the OpenFive business on leading edge technology. The transitioning process weighed on t...
- Colin Smith
Galliford Try - HY24 trading statement – expectations raised
Galliford Try has published a positive trading statement for 1HFY24 noting higher trading YoY, ahead of the Board's expectations. With good visibility over 2HFY24, guidance for FY24 has been raised, with revenue and PBT anticipated to be c5% ahead of current market expectations. Given excellent progress to date, Galliford Try expects to update its strategic targets in 2Q calendar 2024, extending them out to FY30. The order book closed the half at £3.7bn (£3.5bn at 1HFY23) and month-end cash for...
- Colin Smith
Trustpilot - FY23 trading update – Another beat, £20m SBB
Trustpilot has announced another beat to expectations and the implementation of a £20m share buyback programme. The company has guided to full year revenue of US$176m, with annual recurring revenue of US$197m and total bookings of US$195m. Trustpilot expects to report adjusted EBITDA above the US$14.1m top end of the range of market expectations. This was another strong performance from Trustpilot with revenue growth coming in a little better than guidance at the interims and further operational...
- Colin Smith
Seplat Energy - Research Update - Valuation Catalysts
We believe Seplat has multiple catalysts for value uplift which remain poorly understood despite the share price outperformance this year. Based on new modelling, we provide detailed insights into these catalysts. Most certain are improved operational reliability and the start-up of the ANOH gas project. Completion of the MPNU acquisition and conversion to the new PIA terms could be transformative while enhanced corporate governance and the improved outlook for Nigeria add supportive context. Se...
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