reports
- Martin Hall
Hardman & Co Investor Forum Research on Shield Therapeutics (STX): Pro...
Shield is a commercial-stage pharma company delivering specialty products that address the needs of patients with iron deficiency (ID). Since its July 2021 US launch, Shield and Viatris have increased physician awareness of the differentiating characteristics of ACCRUFeR® as an oral ID drug, in order to generate sales traction. The 3Q’24 trading update reiterated the interim statement dialog: sales continue to progress, while costs are being actively managed. Shield is being proactive, extending...
- Mike Foster
Hardman & Co Investor Forum Research on Custodian Property Income REIT...
The structure and investment remit of the real estate investment trust (REIT) have been proven to be resilient and position it strongly for the short- and medium-term future. The investment return emphasis is on income, which is generated from a diverse portfolio with modest capital gearing. Because Custodian Property Income REIT (CREI) is designed to focus on smaller, individual property lot sizes, it acquires at higher asset yields than the market in general. It does not need, therefore, and h...
- Richard Jeans
Hardman & Co Investor Forum Research on: Windward (WNWD): High-growth ...
Windward is a fast-growing predictive analytics company that is focused on digitalising the global maritime industry. Windward’s AI-powered decision platform offers a wide-ranging view of the maritime ecosystem and enables stakeholders to make real-time, predictive intelligence-driven decisions to achieve business and operational readiness. The group operates a subscription-based or software-as-as-service revenue model, which provides very high (ca.99%) levels of recurring revenue and is cash-ge...
- Brian Moretta
Blackfinch Spring VCT - Blackfinch Investments Limited
The Blackfinch Spring VCT will give investors exposure to a range of growth-stage, technology-enabled investments. It is targeting a dividend yield of 5% from FY’24, with special dividends, if realisations permit. The report goes into details of how the investment process works, sourcing and decision-making, exit strategies, post-investment governance and monitoring, fees and more. It also includes Hardman & Co’s unique fee calculation table, allowing advisors and investors to properly investiga...
- Mark Thomas
Duke Capital (DUKE): Taking Duke Capital to the next level
In our April 2024 initiation, we highlighted that DUKE, by optimising the best of equity and debt, aimed to achieve equity-type returns with debt levels of risk. We highlighted four pillars of returns, namely: i) term credit; ii) participating preference shares, which support DUKE’s high, covered and growing dividend yield (2025E 10.0%, 2026E 10.7%, 2027E 11.4%); iii) early exit fees; and iv) equity stakes. Here, we update investors on how management will take DUKE to the next level, noting i) a...
- Brian Moretta
Calculus VCT plc - Calculus Capital Limited
The Calculus VCT invests in a mixture of young technology, healthcare and media companies. Gradually, it has been increasing the proportion invested over the past few years, despite the additional fundraising in the same period. This is likely to have helped improve performance in the past three years. Calculus, itself, is one of the longest-standing managers in the space, with a stable, experienced team. The report goes into details of how the investment process works, sourcing and decision-ma...
- Mark Thomas
NB Private Equity Partners - CM day: 6 November fireworks
The key takeaways from NBPE’s 6 November CM day, in our view, were i) positive market indications, including exits and an increase in the correlation between operating company EBITDA growth and NAV growth, ii) NB’s platform brings unique benefits: accessing deals, analysing investment opportunities, and GP relationships, (which have generated a big increase in opportunities presented to them, even when the overall market slowed), and iii) multiple levers for value creation mean that bottom-line...
Hardman & Co Insight: “ROOM” (Running Out of Money) risk
How managing liquidity risk can sustain corporate value and maintain shareholder confidence As we come close to the end of a very challenging year for many UK entrepreneurs, as well as a frustrating period for shareholders, it is time to address one elephant in the ROOM! ROOM stands for “Running Out of Money”. The risk of doing so, or the perception that it could occur, can destroy corporate values and prematurely paralyse a business. While this is a new description of the traditional referen...
- Brian Moretta
Manager Review – Praetura Investments
Praetura Investments has been a leader in supporting venture companies and SMEs across the North of the UK, with a commitment to delivering “More Than Money” through strategic and operational support in addition to funding. Founded in Manchester, Praetura has grown significantly, now managing over £300 million in assets and providing flexible financial solutions through a range of tax-advantaged products and partnerships with institutions like British Business Investments. Our latest report off...
- Mark Thomas
- Martin Hall
The Hardman & Co Monthly: November 2024
Feature article: “ROOM” (Running Out of Money) risk, How managing liquidity risk can sustain corporate value and maintain shareholder confidence As we come close to the end of a very challenging year for many UK entrepreneurs, as well as a frustrating period for shareholders, it is time to address one elephant in the ROOM! ROOM stands for “Running Out of Money”. The risk of doing so, or the perception that it could occur, can destroy corporate values and prematurely paralyse a business. While ...
- Brian Moretta
Calculus EIS Fund - Calculus Capital Limited
Calculus EIS Fund is an EIS fund that will invest in a minimum of six companies. The target return for each investee company is an IRR of 20%, with a return of £2 for each £1 invested. Returns will be focused on capital gains, and investors are unlikely to receive any dividends. The aim is for the assets to be invested 12-15 months from closure of the tranche. Calculus Capital Limited is the Fund Manager, and there are no other companies involved in running the fund. The report goes into detai...
- Mark Thomas
ICG Enterprise Trust plc: Portfolio: 14% EBITDA growth + widening marg...
The key message from ICGT’s 1HFY’25 results (to July) is the continued strength of the operating companies, which delivered an average 14% LTM EBITDA growth. Margins have widened by ca.5% (average revenue growth 9.4%), which should help allay some concerns over the impact of the higher-rate environment. New investment is accelerating, and realisation activity continued with an average 26% uplift to carrying values on exit. A degree of short-term volatility is to be expected, and the five- and 10...
- Mark Thomas
- Mike Foster
Real Estate Credit Investments (RECI): Why the discount has been closi...
RECI’s discount has halved over the past six months. We believe this is due to both actions taken by the trust (with an active buyback programme, changing asset mix and enhanced disclosure of highest-risk positions) and more favourable markets. Interestingly, not all debt investment companies have benefitted from the more favourable markets. By historical standards, the current level of RECI’s discount is very high, ca.10% above the 10-year average. RECI was at an average 2% premium in 2015-19, ...
- Mike Foster
Surface Transforms (SCE): Estimates suspended
Interim results released on 30 September showed revenue up 58%. The loss before tax widened to £7.6m from £5.6m 1H23. Operationally, the volume ramp-up is continuing but at a rate below target, with yields improving (but also below target), and ongoing downstream process problems. The company stated at the interims that 4Q24 revenues were likely to be £3.5m, which is obviously illustrating the growth over 1H24, but would be 40% down on plan. This means operational cash outflow continues. The com...
- Mark Thomas
NB Private Equity Partners (NBPE): NB: adding value in attractive co-i...
In our initiation, we highlighted that NBPE is uniquely focused in the co-investment sector of PE. Our report underlined why this sector has especially appealing return, cashflow, asset selection, risk management, and GP access characteristics. In this note, we review how the manager, NB, adds value in this attractive market. Inter alia, NB has i) the resources to understand the investee company dynamics, ii) excellent GP relationships and iii) experience/skills that add value to the GPs. Its su...
- Keith Hiscock
Hardman & Co Insight: Labour’s first budget - Investors in its sights?
Summary: ► Budgets are always important for investors. ► The imminent Budget, at the end of October, will be doubly so, because it is the first from the new Labour government, and it has already signalled the need to fill an alleged £22bn black hole, while ruling out changes to more than half the tax base. That implies a lot of the pain will be felt by investors. ► This paper considers the impact of increases in rates for those taxes that affect investors, and the withdrawal of tax concessio...
- Brian Moretta
City of London Investment Group (CLIG): Good fund performance and soli...
City of London has announced its full-year results for 2024. As stated in the trading statement, FUM was $10.24bn, a 9% increase over the year. While market performance offset net outflows, there was a significant improvement in the latter in the second half, which bodes well going forward. Underlying profit before tax of $27.2m was a 0.5% increase over 2023’s $27.0m. A higher effective tax rate meant that underlying EPS declined 3% from 43.4¢ to 42.2¢. As previously announced, the final dividen...
- Brian Moretta
- Keith Hiscock
- Mark Thomas
- Martin Hall
Hardman & Co Monthly: October 2024
Feature article: Labour’s first Budget - Investors in their sights? Summary ► Budgets are always important for investors. ► The imminent Budget, at the end of October, will be doubly so, because it is the first from the new Labour government, and it has already signalled the need to fill an alleged £22bn black hole, while ruling out changes to more than half the tax base. That implies a lot of the pain will be felt by investors. ► This paper considers the impact of increases in rates for th...
- Jason Streets
The International Stock Exchange (TISE): Strong bounce back continues
The International Stock Exchange (TISE) had an excellent half year to June 2024: revenue was up 22% to £6.4m and fully diluted EPS +27% to 105p. The second interim dividend was raised 67% to 75p, reflecting the new, higher payout, dividend policy. The performance, once again, demonstrates the strength of the business, this time against a background of more active markets. We have raised our forecasts: 2024 EPS goes to 191p, from 182p; and 2025 to 232p from 219p. Our valuation range rises proport...
- Mark Thomas
Apax Global Alpha (APAX) - 1H’24 deal activity coming back strongly
The key messages from AGA’s 1H’24 results were i) a strong rebound in deal activity both for investments and exits (the regular announcements mean this trend was expected), ii) strong growth in investee company EBITDA growth (organic 12.6%, up from 12.2% in FY’23) ‒ widening margins reflect the value added by Apax, iii) buybacks utilising the distribution pool started at end-June, and iv) continued diversification and liquidity benefits from the debt portfolio. As noted in our July note, CM day:...
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