reports
- Pedro Fonseca
VietNam Holding - First redemption tender a success
VietNam Holding (VNH) delivered a 27.3% net asset value (NAV) per share total return over the last 12 months (ending 31 October) in sterling terms. The company outperformed a strongly appreciating market (Vietnam All Share Index (VNAS) at 20.6%), driven by the demand from retail investors. The economy showed robust growth, supported by a surge in exports, and investor confidence was reinforced by good H124 corporate earnings. Meanwhile, VNH executed its first share redemption tender, and investo...
- Sean Conroy
OSE Immunotherapeutics - Full Lusvertikimab results reflect potential ...
OSE Immunotherapeutics’ final analysis of the CoTikiS trial in ulcerative colitis (UC) confirmed that Lusvertikimab met the primary endpoint with statistical significance, highlighting its potential to offer a clinically meaningful solution for the condition. In our view, this marks a positive step forward for the candidate, which, to our knowledge, has a unique mechanism of action to address chronic inflammatory and autoimmune diseases. We believe that OSE plans to advance this programme to the...
- Pedro Fonseca
Murray Income Trust - Income focus keeps paying dividends
Murray Income Trust (MUT) invests in high-quality, mainly UK-listed stocks. MUT’s manager, Charles Luke, believes quality stocks are best placed to support the trust’s objective to provide a high and rising dividend. The trust has realised this objective, delivering continually rising dividends for 51 years, and looks set to extend this record in FY25. MUT’s quality focus has undermined its relative performance over recent years, as value stocks have outperformed, but long-term performance has b...
- Richard Williamson
AUSTRIACARD - Solid Q324 supports FY24 outlook
AUSTRIACARD’s Q324 results confirmed the company made good progress towards its FY24 adjusted revenue and EBITDA targets. The sale of metal cards to banks, a new security printing contract in East Africa and a growing number of digital transformation projects helped generate adjusted revenue growth of 30% y-o-y in Q324 and 14% in the first nine months of 2024 (9M24). Adjusted operating profit grew 52% y-o-y in Q324 and 23% for 9M24, with operating margin expansion of 0.7pp to 10.2% for 9M24. Wit...
- Sanjeev Bahl
HELLENiQ ENERGY - Margins troughed in Q3, expect Q4 improvement
HELLENiQ ENERGY’s Q324 results were held back by a weak refining environment, as previously guided by the company, but showed an impressive operational performance. The company noted that the Q424 refining margin is likely to be $2/bbl to $3/bbl above the average for Q3. Q3 refining sales volumes of 4.163m tonnes were up 8% y-o-y, adjusted EBITDA of €183m was down 54% y o y and adjusted net income of €49m was down 77% y-o-y. HELLENiQ’s Q324 benchmark refining margin declined to $3.6/bbl, from $5...
- Richard Williamson
Nanoco Group - Board states case for voting against resolutions
Nanoco has issued a circular recommending that shareholders vote against both resolutions being proposed by Milkwood in its requisition for a general meeting (scheduled for 11:30am on 13 December 2024). We summarise the board’s key arguments below.
- Toby Thorrington
Solid State - Defence contract delay affects expectations
The delay of a major contract inevitably has an impact on short-term profitability. Solid State has a strong balance sheet and a growth strategy to develop into a higher value-added electronics components and systems business, as witnessed by the two recent small acquisitions. Post the current hiatus we expect this to drive growth and value creation.
- Toby Thorrington
Melrose Industries - H224 progress in line with guidance
Melrose Industries’ H224 trading has been in line with management’s expectations despite the volatility in the civil aerospace market, highlighting the strength of the business, in particular in the aftermarket. As 2024 draws to a close and investors look to focus increasingly on FY25, Melrose’s valuation becomes increasingly attractive.
- Pedro Fonseca
JDC Group - On track to reach high-end FY24 sales guidance
After two quarters of >20% y-o-y revenue growth, JDC Group (JDC) has benefited from strong tailwinds in Q324 as well. Revenue growth of 36% in the quarter was partly driven by the acquisition of Top Ten, but mostly by strong Insurance, investment and banks activities. Q424 is also expected to be strong and JDC indicated that the high end of FY24 revenue guidance of €205–220m is well within reach. FY24 EBITDA guidance is in the range of €14.5–16.0m (FY23: €11.7m). After raising our estimates with...
- Toby Thorrington
Smiths News - Growth potential and a double-digit yield
Smiths News now has contracts in place for 91% of its core revenue to 2029, implying resilience. In addition, its non-core growth activities are beginning to gather momentum, which is already mitigating the structural decline of the core activity. Furthermore, the addressable non-core ‘early morning’ market is sizable and has a profit opportunity of c £160m, which implies that there is potential to more than offset the decline seen in the core operations and could lead to long-term profit growth...
- Sean Conroy
SIGA Technologies - Strong order book moving into Q424
SIGA Technologies reported revenues of $10m in Q324, attributed primarily to deliveries under the $112.5m BARDA option, exercised in July 2024. Backed by a strong order book ($146m at end-Q324), the sales momentum has picked up pace in Q424 with another $51.2m and $8.5m of oral and IV TPOXX (IVT) delivered to the Strategic National Stockpile (SNS) in October 2024. We expect further deliveries in Q424 and early 2025 under the BARDA contract as well as the $9m US Department of Defense (DoD) order ...
- Fiona Orford-Williams
Dentsu Group - Still fighting market headwinds
Dentsu posted Q324 organic net revenue growth of 0.3%, making a decline of 1.1% over the nine-month period. This is slightly below expectations at the half-year and, as the market for larger, transformational projects is still stagnant, management has trimmed full year organic revenue growth guidance to 0% (was 1%) and that for adjusted operating profit by 7%. There are positive elements to these figures, in particular continuing progress in Japan and good new business boosted by the ‘one dentsu...
- Alison Turner
Alphamin Resources - From alpha to omega
Alphamin announced record quarterly tin production of 4,917t (+22.1% quarter-on-quarter) in Q324 and EBITDA of US$91.6m (+68.8%) after the Mpama South mine completed its first full quarter of production at (or near) steady state. Alphamin’s consolidated annual financial statements and accompanying management discussion and analysis (MD&A) for FY24 will probably be released in early March. In the meantime, we are forecasting that EPS will continue to advance into FY25 and beyond under the influen...
- Pedro Fonseca
Apax Global Alpha - Transaction activity picked up in Q324
Apax Global Alpha (AGA) reported a Q324 NAV total return (TR) of 1.7% in euro terms on a constant currency basis (-0.2% including fx changes), with a 3.2pp positive contribution from earnings momentum across its private equity (PE) investments. The company experienced a pick-up in new investments, and also saw some positive trends on the realisation front. Following recent exits and accounting for the take-private transaction of Thoughtworks, AGA’s pro-forma exposure to listed holdings has been ...
- Toby Thorrington
PVA TePla - Lower estimates after Q3 results
PVA TePla (PVA) reported a 2.3% y-o-y decrease in sales in Q324 and management has set guidance at the lower end of the range for both sales (€270–90m) and EBITDA (€47–51m). Metrology sales held up nicely in the quarter, while sales in the other activities in the semiconductor division showed a decrease. We have lowered our estimates modestly for both FY24 and FY25 given a more challenging expected market environment in wafer fabrication for the semiconductor industry. On our new estimates, PVA ...
- Pedro Fonseca
Metro Bank - Profitability achieved and targets reiterated
Metro Bank (Metro) has published a trading update that shows that it returned to profitability in October. This is consistent with previous guidance of a return to profitability during Q424 and the bank has reiterated its guidance for a mid- to upper single-digit FY25 return on tangible equity (RoTE). The October net interest margin of 2.48% also points to faster improvement than we had anticipated. Separately, the bank reported that it has resolved Financial Conduct Authority (FCA) enquiries in...
- Alison Turner
Pan African Resources - Tennant Creek acquisition
On 5 November, Pan African Resources (PAF) announced that it is to acquire privately owned Tennant Consolidated Mining Group (TCMG) in Australia’s Northern Territory for a total consideration of US$54.2m in an all-share deal that involves it issuing an additional 125.4m shares (or 6.5% of its existing share capital). The acquisition price equates to an undemanding US$42.15 per resource ounce of gold or US$139.21 per reserve ounce. While we expect the acquisition to have little effect on PAF’s ea...
- Richard Williamson
Datatec - Operational focus drives H125 profit growth
In H125, while revenue declined due to mix and net revenue accounting, Datatec grew gross profit by 3.5% y-o-y and adjusted EBITDA by 18.5%, resulting in a 56.2% increase in underlying EPS (uEPS). Both Westcon and Logicalis International delivered strong profit growth, while Logicalis Latin America managed to offset lower revenues with reductions in its cost base. Management continues to expect a better financial performance from all three businesses in FY25. We have upgraded our forecasts to re...
- Toby Thorrington
Braemar - On track to achieve FY25 targets
Braemar’s H125 results were in line with expectations, with modest revenue growth and some operational gearing evident in operating profit. The underlying activities continue to expand and diversify and Braemar remains well-positioned to drive its growth strategy. The trading outlook for FY25 is promising and we expect the company to be able to leverage its strong balance sheet in pursuit of strategic growth in a fragmented market. We maintain our underlying revenue and operating profit estimate...
- Richard Williamson
Tinexta - Weak Q324 but valuation appears too pessimistic
Tinexta’s weak Q324 results from its Cyber Security (CS) and Business Innovation (BI) divisions have prompted management to downgrade financial guidance for FY24 for the second time this year. We also take a more cautious stance on expected growth in FY25 and FY26. The c 60% decline in the share price in 2024, versus cumulative underlying downgrades of 16% to FY24e adjusted EBITDA, reflects investor concerns about two of Tinexta’s most significant acquisitions in recent years, the CS division an...
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