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Breakfast Alert - Armadale Capital,Legendary Investments, Westminster Group

Breakfast Alert - Armadale Capital,Legendary Investments, Westminster Group

Markets
Europe

The FTSE-100 finished Friday's session 0.85% higher at 7,687.77, whilst the FTSE AIM All-Share index was up 0.44% at 1,049.63. In continental Europe, the CAC-40 finished 0.50% lower at 5,312.56 whilst the DAX was down 0.48% at 12,917.64.

Wall Street
Last Friday in New York, the Dow Jones closed 0.48%, or 118.29 points, lower at 24,719.22, the S&P 500 fell 0.52%, or 13.93 points, to end 2017 at 2,673.61 and the Nasdaq dropped 0.67%, or 46.77 points, to 6,903.39.

Asia
In Asian markets this morning, the Nikkei 225 is closed and remains at 22,764.94, while the Hang Seng homed in on a 10-year high at 30,463.69 (+1.82%) heading into the close.

Oil
In early trade today, WTI crude recently settled at $60.63 (+0.35%) per barrel and Brent at $67.11 (+0.36%) per barrel.

Headlines
Households urged to start saving now for next Christmas
Low-earning households are being urged to start saving money now in time for next Christmas. The debt charity The Money Advice Trust (MAT) is advising consumers who struggle with savings to budget for the year ahead. One idea, it says, is to join a credit union. An internet survey conducted for the MAT also suggests that more people will struggle with their finances this January than was the case last year. Some 16% of people questioned said they were likely - or very likely - to fall behind with their finances in January, as a result of Christmas spending. That amounts to 7.9 million people, the MAT said, and compares with 11% in a similar poll last year. The majority - 68% - said they would cope sufficiently during the month.
Source: BBC News

Company news
Armadale Capital (LON:ACP 1.82p) – Speculative Buy
Armadale Capital announced positive results from test work completed on a bulk sample from its wholly owned Mahenge Liandu graphite project in Tanzania. Excellent flake size distributions have been confirmed with 48.2% in the high-value Large (180-300µm), Jumbo (300-500µm) and Super Jumbo (>500 µm) categories. Very high purity was achieved with 98.2% total graphite content (TGC). These results underpin Mahenge Liandu’s potential to produce high-quality graphite concentrates, which should be suitable for a number of commercial applications including the rapidly growing battery market. Work also continues to enhance the current high-grade JORC-compliant resource of 40.9Mt grading 9.41% TGC and the upcoming Scoping Study results expected in early 2018.

Our view: We continued to be impressed with the results coming from the Mehange Liandu graphite project. The flake size distribution coupled with the high-purity graphite concentrate produced from demonstrate the project’s potential as a commercially viable graphite source suitable for a range of commercial applications. Armadale is looking to capitalise on the expected growth in the graphite market driven by increasing applications particularly in the energy storage market. We look forward to the updated resource model as well as results from the Scoping Study in early 2018. In the meantime, we maintain a Speculative Buy rating on the stock.

Beaufort Securities acts as a corporate broker to Armadale Capital PLC


Legendary Investments (LON:LEG 0.13p) – Speculative Buy
Legendary, on 22 December 2017, announced that it has entered into an agreement to acquire an interest of up to 2% in Circle Oil Tunisia Limited (‘COTL’), in exchange for its 5.5% stake (books value of £100,000) in Manas Resources LLC (‘Manas’). COTL owns El Mediouni East and Central oil asset (‘ELM’) in the Mahdia Permit located in the Gulf of Hammamet off the Tunisian coast. The Permit duration and work programme are in the process of being finalised.

Our view: The management of Legendary has exchanged its stake in a view that COTL’s ELM is in greater shareholder interest with a shorter timescale for fruition and possibly at a greater value compared to Manas. Over the past 5 years, COTL’s liquidated parent company, Circle Oil Plc invested heavily in ELM and said it internally estimated potentially recoverable prospective resources of approximately 100 million barrels of oil. COTL is now operating under new management. Simply valuing one of Legendary’s portfolio copmpany, 7.2% stake in Virtual Stock on the basis of Notion Capital’s recent funding injection, suggests some 20% premium to LEG’s current market capitalisation. In expectation of Legendary’s participation in VS becoming more realistically valued within LEG’s wider portfolio, Beaufort retains its Speculative Buy recommendation on the shares along with its 0.7p price target.

Beaufort Securities acts as corporate broker to Legendary Investments plc


Westminster Group (LON:WSG 24.00p) – Speculative Buy
Westminster Group, on 22 December 2017, announced that with respect to its major long-term project opportunity within the Middle East, all but a few more minor commercial and contractual issues have now been agreed by a number of governmental departments and organisations. The company is now pending its client for one final internal approval to undertake this project in phases, with the initial phase expected to be worth approximately €24m per annum to Westminster. Any future extensions and changes of scope are expected to be subject to price revision. The company is scheduled to release full year trading update and expecting to provide a further update on Middle East project opportunity in January 2018.

Our view: The company has made a huge progress with respect to its Middle East opportunity. We look forward to the further update this month. Financially, the company said it has plans in place to raise the required funds in Q1 2018 to support investment in this project and other potential new Managed Services contracts. Given positive progress, Beaufort reiterate its Speculative Buy rating on the share.

Beaufort Securities acts as corporate broker to Westminster Group PLC
 

Latest Video
On Monday, 18th December 2017 Dr Dan Gooding, CEO of Nuformix answered questions posed by private investors at the Beaufort offices. Click here to see the interview.

Nuformix: Investor Q&A

 

Beaufort Securities acts as corporate broker to Nuformix plc

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