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Pressure Technologies steps on the gas after agreeing to sell its alternative energy division

A look at the day's major movers, including Local Shopping REIT, Just Group, Photo-Me, Lb-Shell, Avacta and ValiRx
Biotherapeutics
The Avacta deal was good news, also, for IP Group, which acted as an incubator for Avacta

Pressure Technologies Plc (LON:PRES), the specialist engineering group, is to sell its Greenlane Biogas division.

The shares rose 11p to 98.5p, giving the company a market capitalisation of around £16.3mln, as it revealed a Canadian company, Creation Capital, is to pay £11.1mln for Pressure’s alternative energy division.

"The global outlook for renewable natural gas (RNG) has improved again throughout the year with governments and energy majors increasing their commitment to renewables in the global energy mix, with RNG playing a significant role, particularly in the US and Europe,” said Chris Waters, the chief executive officer of Pressure Technologies.

So, why are you selling it, Chris?

The simple answer is that, after a strategic review, the company decided this was the best way to create value for Pressure’s shareholders.

“We will remain a supportive minority shareholder and anticipate retaining our holding for the medium term,” Waters said.

1.30pm: Local Shopping REIT dives as it says shareholders might get less than anticipated after company winds down

If I had to choose a name for a company designed to put off investors, Local Shopping REIT PLC (LON:LSR) would probably figure high on the list.

The real estate investment trust’s (REIT) shares were down almost 10% this morning at 27.4p after the company announced a loss for the year to the end of September of £7.15mln, compared to a loss of £860,000 the year before.

The value of the portfolio at the end of September stood at £22.3mln, down from £55.46mln a year earlier after the company sold off a number of properties and paid off its bank debt. On a like-for-like basis, the value of the portfolio fell by 6.2% in the first half of the financial year just ended and by 13.2% in the second half of the year.

The company is winding down to a voluntary liquidation and had previously indicated that the net realisable value of its portfolio would work out at somewhere between 33p and 34.5p per share; the directors now believe the distribution will likely be at the lower end of that range.

12.30pm: Retirement solutions provider Just Group a lot happier with latest PRA paper on equity release mortgages

The Prudential Regulation Authority has published “Policy Statement PS31/18 Solvency II: Equity release mortgages”, which has set the pulses of Just Group PLC (LON:JUST) racing.

Just Group – just in case you thought it was an online food ordering app developer – is a provider of retirement financial solutions and if one thing gets it more animated than a cracking bowls tournament (southern softie flat green version) is the Prudential Regulation Authority’s (PRA) confirmation that transitional relief will remain available for pre-2016 business.

The group has helpfully highlighted what it regards as the key changes in the policy document from the consultation paper, which should, in the words of Rodney Cook, the chief executive of Just Group, result in a regime that is “considerably less onerous” for Just than what the consultation paper had lined-up.

READ Just Group sees new business sales rise as it prepares for new capital requirements

“The outcome is well within the range of what we have been planning for; however, even at the 13%/1% parameters confirmed today, we view the EVT [effective value test] as very prudent, as for JRL2 [Just Retirement Ltd] it is equivalent to holding capital and technical provisions sufficient for the price of every house in the portfolio to fall immediately by over 35% and then remain there indefinitely,” Cook explained.

“The changes prescribed by the policy statement do not take effect until 31 December 2019. This means the board can evaluate the optimal capital structure to support our new business franchise in a considered manner,” he added.

Shares in Just Group were the second-best performers in London, up 22% at 100.2p.

10.30am: What's wrong with this picture? Photo-Me outlook statement warns about possible developments

The name Photo-Me International PLC (LON:PHTM) has become less appropriate down the years as the firm has branched out into laundromat machines.

This morning’s results statement proved to be a bit of a wash-out, with the company reporting half-year pre-tax profits of £26mln, down 21% compared to a year ago, while underlying revenues rose 2.5% to £119.8mln.

Although the group maintained its guidance for the current fiscal year (to the end of April), investors were spooked by a line in the statement that said, “the group's ability to meet guidance will be reliant on normalised trading conditions in its key markets”.

Those key markets are France and the UK, neither of which at the present time could be viewed as hotbeds of stability and consumer cheer.

Serge Crasnianski, the chief executive officer, expanded on the cautious outlook statement a bit by saying, “The group's ability to meet guidance remains subject to the economic environment, foreign exchange movements and consumer sentiment, which could affect performance."

There was little change of house broker finnCap airing any dirty laundry and it accentuated the positive, noting that the results showed the “continued strong growth in laundry” and a faster-than-expected recovery in Japan, although to be fair, the broker also noted slower business-to-business and third-party sales in the UK.

“These later two points are expected to improve in H2 and guidance for the full year is maintained but there is clearly some risk here,” finnCap said.

The broker left its forecasts unchanged and its price target untouched at 183p.

Canaccord Genuity was a bit more cautious, trimming its target price to 150p from 160p. Photo-Me shares currently trade at 95p, down 11.2p on the day.

 

10.30am: Lb-Shell - formerly Intelligent Energy - to power down

Lb-Shell PLC (LON:LBP) changed its name from Intelligent Energy Holdings in November 2017 but shareholders hoping for a rebirth will be disappointed.

As the name of the company implies, it is a cash shell, and the original plan after Intelligent Energy sold off its assets to Meditor Energy in October 2017 was to effect an orderly run-down of the company with a return of any cash to shareholders.

That all changed in May, when Melissa Sturgess, Charles Morgan and Michael Langoulant were appointed to the board to oversee a recapitalisation of the company, in the belief this could lead to greater value for shareholders rather than simply winding it up.

Those hopes have now been dashed after the company said it intends to delist from the stock exchange and commence a voluntary winding-up of the company.

Things all went a bit “Pete Tong” in July, when the company received a letter of claim from lawyers representing certain shareholders of the company, in relation to activities LB-Shell prior to the appointment of the current Board.

The matters referred to in the letter related to the conduct of the initial public offering of Intelligent Energy Holdings and the subsequent sale of substantially all of the business and its assets.

No legal action has been threatened but neither have there been any guarantees that there would not be any legal action, as a result of which the board has decided to fold up its tent and move on rather than run the risk of recapitalising the company only to see the funds raised syphoned off by successful litigants.

In all probability, that is the most that has ever been written about Lb-Shell on this or any other financial web site.

I see from a Proactive article that Intelligent Energy’s shares were trading at 7.5p 18 months ago; today they slumped 22% to 0.175p.

9.00am: Two tiddlers from the pharmaceuticals sector set the early pace

Avacta Group PLC (LON: AVCT) was the top riser in London after agreeing on a development partnership and licence agreement with South Korea’s LG Group.

The AIM-listed developer of Affimer biotherapeutics and reagents said the multi-target therapeutics development agreement provides for upfront and near-term milestone payments, plus longer-term clinical development milestones totalling US$180 million.

"We are very pleased to announce collaboration with Avacta Group,” said Dr Jeewoong Son, the president of LG Chem Life Sciences.

“Utilising Avacta's Affimer technology - a novel non-antibody protein format overcoming limitations of classical antibody-based therapy - and LG Chem's biologics capability in development and manufacturing, it will take us to the next level of treatment paradigm and to open up a new horizon in biologics therapeutic strategies. I believe this innovative collaboration will deliver value to patients and will transform patients' lives," he added.

Shares in Avacta were up 36% at 31.5p, having risen as high as 36p at one point.

Sector peer ValiRx Plc (LON:VAL) was also flying high, advancing 29% to 1.55p after the company announced there had been a “statistically significant dose-dependent response” for its VAL201 treatment in a Phase I/II clinical trial regarding its effect on prostate cancer.

The cancer therapeutics firm said participants in the trial treated with VAL201 displayed a “statistically significant correlation” for reductions over time in the amount of testosterone and prostate-specific antigen (PSA), both of which are commonly used markers for disease progression in prostate cancer.

Proactive news headlines:

Avacta Group PLC (LON:AVCT) has agreed on a development partnership and licence agreement with South Korea’s LG Group, to develop Affimer therapeutics in several disease areas.

ValiRx Plc (LON:VAL) has recorded a “statistically significant dose dependent response” for its VAL201 treatment in a Phase I/II clinical trial regarding its effect on prostate cancer.

Minds + Machines Group Limited (LON:MMX), the top-level domain (TLD) registry company, said its initial investment into the .luxe TLD has been recouped within the first four weeks of launch.

Kromek Group PLC (LON:KMK) has been awarded its first contract for biological threat detection from the Defense Advanced Research Projects Agency (DARPA), part of the US Department of Defense.

Silence Therapeutics PLC (LON:SLN) announced on Monday that it has reached a settlement and license agreement with Alnylam Pharmaceuticals, Inc (NASDAQ: ALNY) which resolves all patent legal proceedings between the two firms.

The world’s largest producer of insulin is to use e-Therapeutics PLC’s (LON:ETX) Network-Driven Drug Discovery (NDD) platform as it looks to discover new ways of treating type-2 diabetes.

Jubilee Metals Group PLC (LON:JLP) is acquiring rights to all the chrome at the PlatCro project in South Africa, where it already controls the platinum group elements. The operation is already in production and is currently processing 75,000 tonnes of ore per month from a resource base of over 1.8mln tonnes.

Metal Tiger PLC (LON:MTR) has intersected wide zones of finely disseminated chalcocite and bornite copper mineralisation from 85 metres to 385 metres downhole a the Tshukudu exploration joint venture in Botswana.

Soil sampling and ground-based magnetic surveys conducted by Kavango Resources PLC (LON:KAV) on its KSZ project in Botswana have confirmed the existence of several potentially mineralised structures.

Kibo Energy PLC (LON:KIBO) announced that its 60%-owned UK subsidiary, MAST Energy Developments Limited has secured an exclusive option for the potential acquisition of three peaking power sites totalling 31.3 megawatts (MW). The multi-asset, energy company said it has paid a nominal fee to undertake due diligence and negotiate the deal.

Range Resources Limited (LON:RRL) (ASX:RRS), the company with oil and gas projects and oilfield service businesses in Trinidad and Indonesia, announced that Yan Liu has tendered his resignation as its chief executive officer and as an executive director to allow him to focus on other business interests, effective immediately. The group said its board will consider a replacement CEO as appropriate, and added that in the interim, Zhiwei (Kerry) Gu will assume the role of executive chairman.

Solo Oil PLC (LON:SOLO) told investors it is looking forward to further updates from Tanzanian partner Aminex plc (LON:AEX) after the Kiliwani North project operator this morning confirmed the successful completion of remedial work for the production well.

Aminex plc (LON:AEX) has confirmed the successful completion of remedial work for the Kiliwani North-1 production well in Tanzania. The company, in a statement, revealed that the work had now addressed the previously reported problem with the well’s sub-surface safety valve.

IronRidge Resources LTD (LON:IRR) has commenced a 3,000-metre reverse circulation drilling programme on its Cape Coast lithium portfolio in Ghana. The focus will be on the Abonko target and on the Ewoyaa project northern extension zone, where pegmatite mineralisation remains open.

Europa Metals Ltd (LON:EUZ)(ASX:EUZ) has released results of a scoping study carried out on its Toral lead-zinc-silver project in Spain.

W Resources PLC (LON:WRES) has today announced the mechanical completion of the La Parrilla crusher plant. It paves the way for commissioning of mined ore from the Spanish project during January, the company said in a stock market statement.

Alba Mineral Resources PLC (LON:ALBA) confirmed that it will be holding a shareholder update meeting and presentation followed by a Q&A session on 10 December 2018, at 6:30 pm at 1 America Square conference centre, 17 Crosswall Street, London EC3N 2LB.  It said its executive chairman, George Frangeskides will host the meeting along with key members of the executive team.  The group said the presentation will also be available on the company's website after the shareholder meeting.


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