Maistro seeks shareholder approval for waiver of rule 9 as concert party aims to increase stake Maistro PLC (LON:MAIS) is seeking shareholder approval to waive obligations under rule 9 of the takeover code as a concert party aimed to increase its stake in the firm.

The AIM-listed firm, which operates a business procurement marketplace, said as part of a share subscription announced in November the concert party would increase its holding in the firm from 24.4% to 42.1%.

READ: Maistro targets £2.2mln in fundraising to fuel expansion and automation drive

Under rule 9 of the takeover code, this would require the concert to make an offer for the company, as when any bidder acquires shares worth between 30% and 50% of the target firm a mandatory bid must occur.

Maistro said its board had agreed to waive this condition subject to the passing of a resolution, known as ‘Whitewash’, by independent shareholders at a general meeting on 29 January.
If the resolution does not pass, the subscription of shares by the concert party would no go ahead, the company said in its circular, although added that it believed the terms of the proposal were “fair and reasonable and in the best interests of the company and Independent shareholders”.

The subscription, which is expected to raise around £1.25mln, forms part of a three-pronged fundraising strategy aimed at raising £2.2mln for Maistro to fund an expansion of its sales and support capabilities as well as automation of its software platform.

In late-afternoon trading Friday Maistro shares were at 1.3p.

Fri, 18 Jan 2019 15:32:00 +0000
Vast Resources to no longer receive US$5.5mln tranche of Mercuria prepayment facility Vast Resources PLC (LON:VAST) said its directors are pursuing other potential offers of finance after saying it would no longer receive a long-awaited US$5.5mln tranche from Mercuria Energy Trading as part of a prepayment agreement between the two.

The prepayment off-take agreement reached between the companies last year was for 100% of the copper and zinc concentrate produced at Vast’s Manaila polymetallic mine and Baita Plai polymetallic mine.

READ: Vast Resources inks US$3.0mln bridge facility with Bergen Global Opportunity Fund to finance further working capital

Mercuria was to make up to US$9.5mln available to the company that would be drawn down in two tranches: US$4mln before March 5 and up to US$5.5mln further down the line.

But in a statement on Friday, Vast said Mercuria has informed the group that it is not proceeding with the US$5.5mln tranche.

“The directors are urgently pursuing other potential offers of finance and will report on progress as soon as possible,” it said.

Last month, Vast entered into a US$3.0mln bridge facility with the Bergen Global Opportunity Fund to finance further working capital, including for the Baita Plai Polymetallic Mine and other leading projects.

The company said that the facility had become necessary due to the continued delay of the US$5.5mln Tranche B of the Mercuria prepayment facility.

Shortly after its announcement about Mercuria on Friday, Vast said it has received a notice of conversion in respect of US$500,000 out of the convertible security issued to Bergen at a price of 0.24p.

The company is to issue 164,469,356 ordinary shares of 0.1p each and has applied for the shares to be admitted to trading on AIM.

Fri, 18 Jan 2019 14:59:00 +0000
Horizonte Minerals nears construction start at Araguaia in Brazil
  • Construction permit granted for ferronickel mine in Brazil

  • Feasibility study estimates net present value of mine at US$401mln

  • Building can start once funding of US$443mln is arranged

  • First metal expected in 2022

  • Second project being tested for battery quality nickel hydroxide

  • Broker share price targets range from 8p to 21p per share


    What Horizonte does

    Horizonte Minerals PLC (LON:HZM) is quoted on AIM and the TSX.

    The 100%-owned Araguaia nickel saprolite project in Brazil is its flagship project.

    Horizonte also recently acquired the nearby Vermelho nickel-cobalt project from Vale.

    The Araguaia ferronickel project is in Para State, Brazil.

    Phase 1 will see the production of 14.5kt/year of nickel in ferronickel form, with the potential to increase that to 29kt/year through additional capex spending of US$199mln.

    First production should be in 2022 with the mine scheduled to run for 28 years.

    Capital expenditure for phase I was estimated at US$443mln in last year’s feasibility study with cash costs of US$3.77/lb.

    That feasibility study showed Araguaia to have a post-tax net present value of US$401mln and an internal rate of return of 20.1%.

    Cash costs are expected to be US$3.77 per pound of nickel, or US$8,193 per tonne, making Araguaia a low-cost producer.

    A second project Vermelho, a nickel-cobalt project in the eastern part of the Carajás mining district, was acquired by Horizonte in December.

    Test work is underway to see if the material is pure enough for the electric vehicle (EV) battery market.

    Alternatively, Horizonte is looking for a high-grade ferro-nickel source, which could potentially be treated at the Araguaia plant or at a new standalone facility at Vermelho.

    What the boss says

    "Subject to funding, the company is now in a position to commence construction with the necessary environmental permits approved, including water abstraction permits issued in 2018,” said chief executive Jeremy Martin.

    Vermelho has the potential to supply raw materials into the battery industry, he adds.

    “The outlook for the nickel market is robust, with demand growing at around 5% over the next three to five years from both the traditional stainless-steel sector as well as new demand from growth in the electric vehicle battery market.”

    Inflection points

    • Funding for construction of Araguaia (second quarter 2019)

    • Pre-feasibility study at Vermelho

    • Technology advances in nickel battery usage in electric vehicles and energy storage

    What analysts think:

    Horizonte’s Araguaia ferronickel project in Brazil has been significantly de-risked by the award of a construction licence, says Numis.

    The broker has a price target of 8p on the mining junior with the next catalyst likely to be the arrangement of funding for the Phase 1 development.

    Numis assumes Horizonte will fund construction through a combination of US$240m of equity and US $250m of debt.

    A preliminary economic assessment for Horizonte’s neighbouring Vermelho deposit, which will produce battery grade nickel hydroxide rather than ferronickel for steel, should give the company’s value an additional boost.

    Another broker, Shard, puts Horizonte’s value at a considerably higher 21p per share.

    “To be clear, this (the construction licence) means that HZM has all the permits required to start constructing the RKEF processing plant and associated infrastructure, with project funding remaining as the final hurdle,” it said.

    What it’s worth

    At 2.3p currently, Horizonte’s market value is £33mln.

    Fri, 18 Jan 2019 14:05:00 +0000
    Kodal Minerals looking at larger mining operation at Bougouni lithium project Kodal Minerals PLC (LON:KOD) CEO Bernard Aylward tells Proactive London's Andrew Scott they're considering a larger mining operation at the Bougouni lithium project in Mali following another strong set of drill results.

    He says they're eyeing an initial 1.2 mln tonne a year processing plant, expanding to 1.5 mln tonnes pa as the operation moves into a steady production phase.

    Recent assays contained lithium at grades between 1.2% and 1.7% at Sogola-Baoule and 1.04% at Boumou.

    Fri, 18 Jan 2019 13:15:00 +0000
    D-day for Apollo Global Management to 'put up or shut up' with offer for RPC RPC Group PLC (LON:RPC) shares declined as the takeover decision deadline for potential suitor Apollo Global Management approaches.

    Apollo has until Friday evening to “put up or shut up” with an offer for the plastics packaging firm after extending the deadline several times since September.

    READ: RPC says takeover decision deadline for potential suitor Apollo Global Management extended to 18 January

    “Since September, this has been extended each month, but the absence of a comment this morning suggests that this is the final furlong,” Peel Hunt analyst Harry Philips said.

    “As we have discussed before, the ultimate absence of a deal will be seized upon by the bears in terms of the supposed quality of the numbers, but our view is that Apollo would not have remained engaged for such a length of time if that was a real issue.

    "The clock ticks and I will have to make sure that my mobile has some battery life.”

    Peel Hunt maintained a 'buy' rating and target price of 1,230p on RPC.

    Last month, RPC said talks were “well advanced” and Apollo had confirmed that due diligence was substantially complete.

    Shares fell 2.3% to 699p around noon.

    Fri, 18 Jan 2019 12:15:00 +0000
    How slow can China go? Markets took on a relatively buoyant mood on Friday after a succession of rumours that ongoing trade talks between the US and China are proceeding well.

    The chatter that really cheered investors involved Steve Mnuchin, the Secretary of the Treasury, who was reported to have offered to reduce certain tariffs on Chinese goods in order to draw more concessions from Chinese counterparts in the talks.

    If true, that speaks of both an attitude of flexibility in the US negotiating team and a view that China is ready to deal.

    And on the whole, it’s not hard to see why the negotiators might come to that view.

    The Chinese authorities have recently pumped a significant amount of liquidity into the domestic economy in a bid to keep activity ticking over. On Wednesday 16th January alone a record US$85bn was pumped into the banking system.

    This is not the action of a central bank that is sanguine about the economic welfare of the country. Rather, it speaks of significant stresses in the system, brought about in part by the ongoing slowdown in the pace of overall growth.

    That growth rates will fall in China is fairly evident. No economy in history has ever sustained the kind of rates that China has been turning in over the past decade or two. So the real question is: how will the Chinese authorities manage the change, as the economy matures and begins to fall into step with the cyclical nature of the world’s more advanced economies.

    So far, so good, but it remains a tricky balancing act. According to a poll of 85 economists conducted by Reuters this week, Chinese growth is likely to slow to around 6.3% this year from 6.6% in 2018 and 6.9% in 2017.

    On that analysis, there’s likely to be a soft landing which will take place over several years, particularly if current policy to stimulate domestic demand succeeds.

    One wild card though is the current stance of the US government, and in particular Mr Trump. If US tariffs really start to bite the Chinese economy could slow faster than expected, and that in turn could have nasty knock-on effects.

    For one thing, the current covenant between the ruling party and the people that grants the communists a monopoly on power in return for rising living standards could be called into question. And if the economic competence of the communist party begins to be doubted, then there will be further concerns about the implications for social order.

    So, in that context the stakes are much higher for the Chinese negotiators than for the Americans. While the miracle of Chinese economic growth has been bought at the expense of the American working class, it could just be that the revenge of that same working class will bring about the destruction of the entire Chinese political system.

    These scenarios are a long way from being played out yet, and certainly run counter to the prevailing Chinese narrative of rising strength, as projected militarily in the Spratly Islands and the wider South China Sea, and economically in the Belt and Road initiative.

    And it’s certainly true that China has arrived as a major player on the world economic and political stage in a way that might not have been anticipated thirty years ago.

    But China, like all countries with advanced economies will find out that at some stage good times end, at least for a while, and that hard times throw up new challenges.

    With growth still at over 6% we are ostensibly still a long way from hard times. Unless of course China can be counted as having already arrived in the club of advanced economies. In which case growth of 6% would surely be regarded as an unsustainable bubble.


    Fri, 18 Jan 2019 12:10:00 +0000
    More growth ahead in 2019 for Remote Monitored Systems - Chairman Burton Nigel Burton, chairman of Remote Monitored Systems PLC (LON:RMS), caught up with Proactive London's Andrew Scott to talk through the firm's 2018 trading update as well as prospects for the year ahead.

    RMS has also recently raised £350,000 in a share placing 'to fund growth in its core areas'.

    Burton says he's expecting 2019 to be a period of strong growth for its two operating businesses - Geocurve and Gyrometric.

    Fri, 18 Jan 2019 12:07:00 +0000
    LoopUp Group signs material contract renewal with leading global law firm LoopUp Group PLC (LON LOOP) co-CEO Steve Flavell tells Proactive London's Andrew Scott they've bagged a significant contract renewal with law firm Clifford Chance.

    The minimum total contract value of £2.34 mln in aggregate over the three-year term is for the provision of conference calls across Clifford Chance's global operations, spanning 32 major financial centres in the Americas, Asia Pacific, Europe, the Middle East and Africa.

    Fri, 18 Jan 2019 11:52:00 +0000
    Goldman Sachs says Anglo American remains top pick in mining, sending shares higher Goldman Sachs said Anglo American PLC (LON:AAL) remains its preferred name in mining due to strong earnings and an undemanding valuation.

    In a note on European mining equities on Friday, Goldman maintained a ‘buy’ rating on the stock, saying: “Our top idea remains Anglo American — it is one of the few quality companies for which we expect positive earnings momentum this year, especially as Minas Rio returns.”

    READ:  Anglo American restarts operations at Minas-Rio iron operation in Brazil after discovery of two pipeline leaks

    Anglo halted production at the Brazilian Minas Rio iron ore mine last March after two leaks at a pipeline that channels slurry more than 500 km from the mine in Minas Gerais state to a port in Rio de Janeiro state.

    The company restarted operations in December and Goldman expects this should help earnings (EBITDA) in 2019 by 7-8%.

    "This, coupled with an improved portfolio that can generate cash even at a lower commodity price deck, makes Anglo an attractive stock, in our view," the investment bank said.

    Anglo generates more than 50% of its earnings from bulk commodities, iron ore and coal. Investors remain bearish on these commodities but Goldman thinks it is notable that iron ore and met coal prices remained strong in recent months despite trade tensions between China and the US that have hit base metal prices.

    However, Goldman lowered its target price on Anglo American to 2,200p from 2,250p to reflect changes to its 2019 estimates.

    "Our estimates change as we update for our commodities team’s recent price forecast changes and also mark to market for fourth quarter commodity prices and foreign exchange," it said.

    "Key risks to our view include lower commodity prices, stronger FX (ZAR/AUD vs. USD), and political risk associated with political and fiscal changes in South Africa."

    In late morning trading, shares rose 1.7% to 1,820p.

    Fri, 18 Jan 2019 11:40:00 +0000
    Daily Blog: Oil price, Anglo African Oil & Gas And finally... Oil price, Anglo African Oil & Gas And finally…



    WTI $52.07 -24c, Brent $61.18 -14c, Diff -$9.11 +10c, NG $3.41 +3c

    Oil price

    The oil price vacillated yesterday, after a weak start the rally nearly took crude into positive territory but not quite. As usual newsflow was mixed, better news on the US/Sino trade front where chatter lead people to think that some tariffs might be eased. With Opec+ saying that cuts were being adhered to Russia said that they would fully commit to cuts but they would take a little time. In Libya trouble subsided and apparently exports are increasing, you pays your money….

    Anglo African Oil and Gas

    I was invited in to meet David Sefton, Executive Chairman who talked me through what’s going on at the company at the moment. I have seen a number of companies this week but am writing up AAOG first as it is drilling at the moment and a result looks to be imminent. BTW, I have a slight difficulty where companies have both an executive Chairman and a CEO, the important defining of lines as to who calls the shots and has final responsibility can get clouded.

    AAOG has, it should be said, just raised £6m at 10p which during such a high profile well as this indicates a considerable degree of faith from both company and investors. I was told that the three largest institutions invested in the company all participated and that there was excess demand which pushed the raise up modestly when they did it very recently. There is some concern that some of the shares taken in that raise may still be floating about, if so it is somewhat concerning on a technical basis.

    The only asset of the company is the Tilapia field in the Lower Congo Basin which is offshore but drilled from land where all the facilities are. AAOG own 56% and SNPC, the Congolese NOC holds the balance of 44%. There is no doubt that the success or otherwise of the well drilling at the moment will be of supreme importance but the fact that there are three horizons with differing risk and potential size complicates matters. The well is already through the R1/R2/R3 sands where the nearby 101 well produces 55 b/d, probably not enough reward for such an expensive well. The lower Mengo Sands are thicker than nearby discoveries and whilst no tests have been done, on the way down decent hydrocarbon pay was encountered and if this is to be relied on the company suggest that it may produce up to 500 b/d.

    Much more importantly is the deeper, Djeno sands where the drill bit is just approaching, if all goes according to plan news from this formation should be known any day now, hence writing this up first. There is little doubt that if the Djeno sands come in it will be transformational for the company, they say that it could be 5/- b/d per well and that they could drill six wells from the pad. Although we have been talking oil here it is not out of the question that it could be gas and/or condensate bearing, both I’m told would be equally welcome…

    I mentioned the cost of the well which is of an historically enormous amount. Endless technical problems have beset the company and this well has been extremely expensive, further wells should be around $8m a go or about $3.5m net to AAOG (It is worth noting that SNPC owes AAOG some $10 which can either be paid in cash or by being granted a larger percentage of the field, a tricky conundrum either way) which would still mean finding more money to drill out the prospect but if they are in the Djeno that is no problem. The company are however not bigging this up, they cautiously are hoping that should the Djeno be dry then on the way back up will test the Mengo sands and produce profitably from there.

    The decision therefore is somewhat tricky, an Aladdin’s cave awaits if the Djeno Sands come good with the drill bit which may be happening right now. Whilst the company are playing this down and accentuating the Mengo Sands I’m sure that an announcement that the Djeno was dry would probably not please the market whatever the company say. This weekend won’t make or break AAOG but it will certainly decide whether that transformation is imminent, as they say in the movies, do you feel lucky…?

    And finally…

    This weekend in the Premiership Liverpool host the Eagles, historically one that Palace enjoy, the Noisy Neighbours are at the Terriers which is the last thing they want. Spurs are at the Cottage, also a must win game for the Cottagers. The stand out tie is probably the Gooners hosting Chelski, both sides need three points whilst the Red Devils host their nemesis the Seagulls.

    A really amazing weekend for rugby fans where there are some really crucial fixtures as the group stage come to a close…

    And good jumping too, you can see Altior at Ascot or go to Haydock and watch the Peter Marsh, some great names out as we start thinking about Cheltenham more seriously..


    Fri, 18 Jan 2019 11:27:00 +0000
    RWS shares advance as Barclays initiates coverage with 'overweight' rating RWS Holdings PLC (LON:RWS) shares moved higher as Barclays initiated coverage of the stock with an ‘overweight’ rating and target price of 560p.

    Barclays said: “We think the combination of capital-light businesses (10x capital turnover) with high and defensible margins (~22%) in end-markets offering long-term mid-single-digit top-line growth makes RWS an attractive investment and justifies its premium valuation (22x Sep-19E P/E).”

    READ: RWS jumps following final dividend hike as Moravia acquisition boosts earnings

    Last month the translation and intellectual property firm reported a 43% jump in 2018 profit to £61.8mln, boosted by the acquisition of Czech translation service provider Moravia. Revenues soared 87% to £306mln.

    The group also said it had made a “very good start” to the 2019 financial year with a “strong performance” in the first two months, underscoring its expectations of delivering another record year.

    In morning trading shares gained 3.4% to 465p. 

    Fri, 18 Jan 2019 10:47:00 +0000
    ITV shares rally as Liberum Capital provides some counterpoints to BofA Merrill Lynch downgrade note ITV plc (LON:ITV) saw its shares rally on Friday, having dropped back sharply in the previous session in reaction to a downgrade in rating by BofA Merrill Lynch, with Liberum Capital reiterating its ‘buy’ stance on the stock and refuting some of the US bank’s arguments.

    Liberum noted that the US bank’s downgrade of ITV to  ‘underperform’ from 'buy', with a reduced target price of 110p down from 210p, came in a European broadcasting review talking about the decline of linear TV hitting the sector.

    READ: ITV hit by BofA Merrill Lynch downgrade in cautious European broadcasting review

    However, Liberum’s analysts provided a few counterpoints to BofA Merrill Lynch’s argument.

    Firstly, they said: “We already know 1H is likely to be impacted by Brexit – Jan / Feb are reportedly up slightly (although this may include VOD - Video On Demand).

    “There has been talk of March being down 25% as advertisers shift advertising spending to 2H. However, as ITV has eliminated its late booking penalties fees, there has been a trend towards advertisers booking money later and later.

    “This may be a consequence of that (and note media buyers got the World Cup boost to ITV in June wrong by around 10-15%).”

    All priced in

    Secondly, the Liberum analysts added: “This is all priced in – if we took ITV’s TV advertising revenues down 10% for 2019 (2009 was -8.3%), and didn’t assume ANY cost-cutting, ITV is priced at just over 11x adjusted FY19E PE

    On a third point, they said ITV is still the only medium to deliver mass market audiences. Shows like Coronation Street, Emmerdale, I’m a Celebrity etc. are seeing stabilising or increasing absolute audience numbers.

    And finally, the analysts said ITV is making inroads to the  VOD market, with 2018 VOD revenues probably up close to 50%.

    They added: “We have written about this extensively but it is already improving ITV’s total advertising numbers by c. 2%. Bloomberg also stated that ITV is the top M&A target in Europe – it is for the third year in a row but it highlights its potential attractiveness.”

    In mid-morning trading, ITV shares were 2.7% higher at 132.55p, having shed 6% on Thursday, with Liberum maintaining a 260p target price on the stock.

    Fri, 18 Jan 2019 10:47:00 +0000
    Today's Morning View - Palladium enters uncharted territory and extends rally SP Angel – Morning View – Friday 18 01 19

    Palladium enters unchartered territory and extends rally


    MiFID II exempt information – see disclaimer below


    Bushveld Minerals* (LON:BMN) BUY – Target Price 87p – China to better enforce vanadium compliance

    Cornish Lithium (Private Company) – Completion of further funding round

    Ironveld (LON:IRON) – Vanadium ore bulk sample delivered to potential off-taker

    Kodal Minerals* (LON:KOD) – Bougouni drilling results

    LSC Lithium (LSC CN) – LSC Lithium enters definitive arrangement agreement to be acquired by Pluspetrol

    Rio Tinto (LON:RIO) – Q4 and 2018 production results highlight copper

    Shanta Gold (LON:SHG) – $325k worth of convertibles bought back

    Vast Resources (LON:VAST) – $5.5m Mercuria Tranche B update


    Geologist killed in Burkina Faso

    • Canadian geologist, Kirk Woodman has been found dead following his kidnapping on 15 January.
    • Woodman’s bullet-riddled body was found near the village of Tiabangou at the Bira Trend exploration site run Predictive Discovery.
    • The news highlights the increased risk of working in Burkina Faso and the worsening security state of the Saharan region in general.


    Dow Jones Industrials





    Nikkei 225





    HK Hang Seng





    Shanghai Composite





    FTSE 350 Mining





    AIM Basic Resources









    US$1.1400/eur vs 1.1388/eur yesterday  Yen 108.77/$ vs 108.76/$  SAr 13.709/$ vs 13.736/$  $1.288/gbp vs $1.285/gbp  0.717/aud vs 0.716/aud  CNY 6.769/$ vs 6.772/$


    Commodity News

    Precious metals:         

    Gold US$1,289/oz vs US$1,291/oz yesterday

       Gold ETFs 72.0moz vs US$72.0moz yesterday

    Platinum US$813/oz vs US$802/oz yesterday

    Palladium US$1,419/oz vs US$1,331/oz yesterday

    • Palladium surges to fresh highs, breaking the $1,400/oz level, to extend its rally even amid signals global vehicle sales are slowing. The fundamental emissions controlling metal used in the auto industry for catalytic converters has surged more than 60% since the middle of August, driven by an acute shortage of immediate supply.
    • Investors are shrugging off signs of automotive weakness in key markets, with annual car sales in Europe falling for the first time since 2013. China also declined last year and sales in the U.S. barely rose. However, ever stringent emissions controls are expected to sustain demand as governments seek to match CO2 targets.
    • The metal will remain in a supply deficit for an eighth straight year, according to Metals Focus Ltd. Palladium’s status as a byproduct of mines in South Africa and Russia means output levels aren’t adjustable to meet short-term demand, despite the surging price.
    • Investors appear to be ignoring the fact that weak sales figures have been reported for all major auto markets in recent days,” Commerzbank analysts report. “Instead, they are seeing news such as the planned widening of a strike to include the platinum mines of a major South African gold and platinum producer as being a good reason to buy.”

    Silver US$15.51/oz vs US$15.62/oz yesterday


    Base metals:   

    Copper US$ 6,041/t vs US$5,981/t yesterday

    • Copper breaks through $6,000/t level as a fresh bout of optimism over the US-China trade stand-off boosts risk assets. Treasury Secretary Steven Mnuchin proposed easing China tariffs, reinforcing earlier signs that the US is eager for a deal to prop up financial markets.
    • Chicago Fed President Charlies Evans says the US economy is doing well and ‘we can easily be patient’ in deciding interest-rate increases. Shares also rose in Asia, extending gains so far in January on policy support from the US and China.

    Aluminium US$ 1,872/t vs US$1,870/t yesterday

    Nickel US$ 11,705/t vs US$11,750/t yesterday

    Zinc US$ 2,580/t vs US$2,501/t yesterday

    • Zinc prices are expected to edge higher through September as Chinese smelters refrain from boosting output due to broad environmental clampdowns, according to Japan’s top smelter.
    • The metal used in construction and auto-making will likely average $2,600/t in the first six months of the Japanese financial year starting April 1 and trade mostly at the higher end of a $2,400-to-$2,800/t range, Osamu Saito, deputy general manager of metals and the recycling unit at Mitsui Mining & Smelting Co.
    • Fitch Solutions, which takes a more bullish view and predicts prices will average $3,050 this year, said this month zinc will recover in coming months amid the tight supply as well as a boost to infrastructure in China.
    • The cleaner skies policy in China, which produces more than 40% of the world’s zinc, has prompted local smelters to limit output growth even as ore supply is surging at mines from Australia to South Africa.
    • Mitsui’s Saito said he predicts the global zinc market will return to a surplus in the second half of 2019 after three years of deficits as Chinese zinc producers are likely to ramp up production from around July, he said.

    Lead US$ 1,982/t vs US$1,981/t yesterday

    Tin US$ 20,725/t vs US$20,700/t yesterday



    Oil US$61.6/bbl vs US$61.0/bbl yesterday

    Natural Gas US$3.327/mmbtu vs US$3.509/mmbtu yesterday

    Uranium US$28.85/lb vs US$28.90/lb yesterday



    Iron ore 62% Fe spot (cfr Tianjin) US$73.4/t vs US$73.2/t

    Chinese steel rebar 25mm US$589.0/t vs US$589.1/t

    Thermal coal (1st year forward cif ARA) US$86.5/t vs US$86.0/t

    Coking coal futures Dalian Exchange US$207.5/t vs US$208.0/t



    Cobalt LME 3m US$40,000/t vs US$45,000/t

    China NdPr Rare Earth Oxide US$46,007/t vs US$46,252/t

    China Lithium carbonate 99% US$9,969/t vs US$9,991/t

    China Ferro Vanadium 80% FOB US$69.7/kg vs US$69.5/kg

    China Antimony Trioxide 99.5% EU US$7.0/kg vs US$7.0/kg

    Tungsten APT European US$260-270/mtu unchanged from previous week


    Battery News

    UK firm launches fuel cell charge point for electric cars

    • British firm AFC Energy has launched the first ever hydrogen fuel cell electric vehicle charger, a system it describes as a “breakthrough” in clean mobility.
    • By using hydrogen fuel cells to recharge battery-electric vehicles in car parks and service stations, the system will help bridge the growing gap between electricity need and generation capacity caused by a projected rise in EV uptake.
    • The modular, low-cost charger also solves some of the logistical issues currently associated with electric car charging, and can even operate entirely off-grid.


    Lithium-ion batteries ‘will be cheapest way to store power by 2050’

    • Researchers at Imperial College London say the technology will become more cost-effective than pumped-storage hydro or hydrogen electrolysis.
    • The study determines the ‘levelised cost of storage’, which refers to the full costs of storing energy including investment, operation and charging cost, as well as technology lifetime, efficiency and performance degradation.
    • The report suggests hydrogen storage and flywheel technologies may become the cheapest techniques for certain niche applications, such as when the stored energy needs to be discharged over a long time period or when it must be discharged very frequently.


    Are lithium-sulphur batteries the answer to increasing the use of electric vehicles?

    • Cranfield University has become a partner in a £7 million European research and development project to develop high energy, safe, lithium-sulphur batteries for electrified vehicles.
    • A Li-S battery can be twice as light, which impacts the weight of a vehicle. Li-S technology also has a higher theoretical energy density, a lower environmental impact technology, and is fully compatible with mass production by green and low-energy processes – delivering a technology that is free of critical raw materials and toxic components.
    • The project ‘Lithium-sulfur for safe road electrification’ (LISA) ,which is being led by Leitat in Spain, will last for 43 months and features a total of 13 organisations from across Europe. It has received funding from the European Union’s Horizon 2020 research and innovation programme.


    Company News

    Bushveld Minerals* (LON:BMN) 42.3p, Mkt Cap £473m – China to better enforce vanadium compliance

    BUY - Target Price 87p

    (Bushveld Minerals now hold 74% of Vametco and 84% of Bushveld Energy it’s vanadium redox battery unit)

    See link for last Bushveld Minerals PDF note

    • Press reports indicate that the Chinese authorities are moving to enforce fuller compliance with the new rules on vanadium in steel rebar.
    • China’s state bureau of quality and technical supervision have already started quality inspections in Jieyang, Guangdong and Xuzhou city, Jiangsu.
    • Reports that some 30-40% of steel mills are not adding sufficient vanadium into their steel are a major embarrassment to the Chinese Authorities as the ongoing use of sub-standard, brittle rebar steel is a major concern to the authorities.
    • The Quench & Temper ‘Q&T’ process is no longer allowed for the hardening of steel rebar for construction as it only makes the metal hard at the surface and is still soft on the inside (sounds like a Cadbury’s crème egg and is about as much use in an earthquake).
    • Steel mills are also being required to improve tolerance limits for rebar diameters and mark their steel to reduce the potential for fake products and t ensure accountability.
    • The cost of vanadium is around 6% ($35/t) of the cost of rebar in China which is currently around $589/t.
    • Ferro-vanadium prices rose again yesterday by 0.7% to $70-72/kgV for 78% fob China.  Prices fell 6% in the US to $39-43/kgV for cheaper 70-80% Vanadium content ferro-vanadium.

    Conclusion:  Ferro-vanadium prices look set to rise again on better enforcement of the new rebar regulations in China. We dearly hope none of the buildings constructed with sub-standard Q&T rebar are ever subject to a major earthquake. Ideally, the authorities would ensure that all Q&T rebar is re-melted and alloyed with vanadium before use in construction. It would be a great tragedy to Chinese bridges, schools and other buildings collapse in the next earthquake because of the use of substandard steel.

    *SP Angel act as Nomad and broker to Bushveld Minerals. *An SP Angel mining analyst and nomad have visited the Vametco in South Africa.


    Cornish Lithium (Private Company) – Completion of further funding round

    • Cornish Lithium successfully raised a subsequent £1m from its existing investor base to enable continued exploration activities in Cornwall and to drill exploratory boreholes to extract samples of lithium bearing brines to validate the deposit model.
    • Lithium-bearing brines continue to be the focus of the Company, however recent research by the Cornish Lithium team has demonstrated potential for the Company to extend its activities to include hardrock sources of lithium and other metals. Cornish Lithium therefore intends to evaluate an integrated approach to both lithium-enriched brines and hardrock projects in Cornwall.
    • The Cornish Lithium team has grasped a totally new understanding of the geological potential of Cornwall’s mineral deposits from the vast collection of historical data. Such understanding includes delineating many of the various mineral ownership structures in Cornwall that have complicated exploration efforts in the past.
    • The application of modern digital software has enabled a holistic view of mineral ownership in combination with structural geology, geophysics and historical mining data for the company to prioritise exploration efforts.
    • The current focus is naturally-circulating lithium-enriched fluids in bedrock which often appeared in historic mines as ‘hot springs’. Cornish Lithium intends to drill extraction boreholes in the vicinity of historic mining operations, but to avoid historic mine workings themselves and instead to target permeable geological features which host the lithium-enriched brines. These brines are believed to be derived from the interaction of geothermal waters with lithium-enriched granite deep beneath Cornwall.

    Conclusion: We look forward to understanding the results of the ongoing exploration work and the potential of Cornwall as a ‘lithium province’.


    Ironveld (LON:IRON) 2.4p, mkt cap £13.9m – Vanadium ore bulk sample delivered to potential off-taker

    • Ironveld report that it has now delivered sufficient vanadium-bearing material to a potential off-taker for a full kiln smelting test.
    • The outcome is expected within the next three weeks.
    • A number of enquiries have also been received from potential development partners.
    • Ironveld plc should have mined a 10,000t bulk sample from their Middleburg iron, vanadium and titanium project in the Bushveld complex of South Africa.
    • The open cast project resource contains 27mt of HPI and 1.4bn lbs of Vanadium (V2O5) in situ JORC.
    • Ironveld are looking to finance and build a 7.5MW smelting facility to produce some 190.5tpa of vanadium in slag grading 36% Vanadium , 21,000tpa of HPI powder and some 4,134.5tpa of titanium TiO2 in slag grading 65%.


    Kodal Minerals* (LON:KOD) 0.175p, Mkt Cap £13.4m – Bougouni drilling results

    • Kodal Minerals has released further results from its 2018 drilling of 3,808m of diamond-core (DD) and reverse-circulation (RC) drilling in 23 holes programme at its Sogola-Baoule  lithium project in southern Mali and the results of the final diamond drill hole of the campaign at the nearby Boumou project.
    • Infill and extension drilling at the Sogola-Baoule prospect has verified the existing geological interpretation and confirmed that the mineralisation remains open both along strike and at depth, making it a priority target for further work.
    • Although assay results remain pending for 18 RC holes at Sogola-Baoule, the company highlights a number of intersections from the 7 RC and 3 DD holes announced today:
      • A 26m long intersection at an average grade of 1.24% Li2O from a depth of 73m in hole MDRC115B;
      • An 18.5m long intersection at an average grade of 1.52% Li2O from a depth of 99.3m in hole MDDH007; and
      • A 14m long intersection at an average grade of 1.43% Li2O from a depth of 142.5m in hole MDDH008.
    • The company points out that hole MDDH006, which intersected 3m at an average grade of 1.28% Li2O from 126.07m and an additional 0.5m averaging 1.87% Li2O from 146m depth “is located to the northeast of the prospect and is interpreted to have intersected a fault zone.  Review of the ground magnetics does highlight potential geological offset in this region, and further drilling will target an area further to the northeast.”
    • The final diamond drill hole of the 2018 campaign at Boumou, KLDH006, which is located in the northern part of the prospect intersected “multiple pegmatite veins consist[ent] with the geological interpretation” including:
      • 1.5m averaging 1.48% Li2O from 56.55m depth;
      • 1m averaging 1.43% Li2O from 59.55m depth;
      • 1m averaging 1.34% Li2O from 81.15m depth;
      • 2m averaging 1.40% Li2O from 117.77m depth;
      • 7.5m averaging 1.04% Li2O from 130.30m depth; and
      • 9.5m averaging 1.04% Li2O from 142.80m depth.
    • Commenting on the latest drilling results, CEO, Bernard Aylward said “The drilling programme completed last year at the Sogola-Baoule and Boumou prospects has confirmed the continuity and robustness of the lithium mineralisation at Bougouni”
    • Mr. Aylward went on to confirm that an updated mineral resource estimate, incorporating all of the drilling results “is on track for delivery at the end of February 2019”. We remind readers that the current estimate, classed as inferred, stands at 17.3mt at an average grade of 1.20% Li2O.
    • He also commented that as a result of “these continuing good results is that we are now able to assess our proposed operation parameters and factor in a larger mining operation with an initial 1.2Mtpa processing plant, expanding to 1.5Mtpa as the operation moves into steady production phase”

    Conclusion: The Bougouni project continues to deliver wide intersections of >1% Li2O assays and the company expects to deliver an updated mineral resource estimate by the end of February. The company hints that this may be at significantly greater tonnage than the existing estimate in its decision to examine the operating parameters of an increased throughput of 1.5mtpa.

    *SP Angel act as Financial Advisor and broker to Kodal Minerals. A partner at SP Angel acts as Chairman to the company.


    LSC Lithium (CVE:LSC) C$0.65, Mkt Cap C$105.4m – LSC Lithium enters definitive arrangement agreement to be acquired by Pluspetrol

    • LSC Lithium enters into an arrangement agreement with Pluspetrol Resources Corporation B.V. pursuant to which Pluspetrol will acquire all of the outstanding common shares of LSC by way of a plan of arrangement under the Business Corporations Act.
    • Under the agreement, Pluspetrol would acquire 100% of the issued and outstanding common shares of LSC for cash consideration of C$0.6612 per LSC share. The Transaction provides total consideration of approximately C$111m.
    • The cash consideration represents a 30% premium to LSC’s 30-day volume-weighted average share price on the TSX-V for the period ending January 14, 2019.
    • The Transaction is the result of the previously announced strategic review process conducted by BMO Capital Markets as lead banker and Haitong Securities of Hong Kong, which was focused on Asia.
    • The strategic review process, while in place since August 2017, was accelerated upon the release of LSC’s updated Resource Estimate on its Pozuelos Project in November 2018 and its robust Preliminary Economic Assessment on its Pozuelos-Pastos Grandes Project in December 2018.
    • LSC Lithium controls a large portfolio of prospective lithium rich salars across Argentina and is focused on developing its material projects - Pozuelos and Pastos Grandes Project, Rio Grande Project and Salinas Grandes Project. LSC Lithium has a land package portfolio totalling approximately 300,000 hectares.
    • LSC Lithium and Rincon Lithium (formerly Enirgi Group Corporation) have a partnership agreement for continued development of Direct Xtraction Process (DXP) technology for lithium brines. The company has funded $30m validating the technology and building and operating a demonstration plant at Salar del Rincon. During 2017, the demonstration plant (capacity 500kg/day) successfully produced battery grade lithium carbonate with delivered recovery rates up to 75% (industry standard previously 55%).
    • Pluspetrol is the leading oil and gas private company in Latin America, with presence in 3 continents and operations in 5 countries: Argentina, Angola, Bolivia, Colombia and Perú.
    • The company also are strong supporter of unconventional reservoirs in Argentina, which makes it a key global player in the strategic resources.


    Rio Tinto (LON:RIO) 3916p, Mkt cap £66.5bn – Q4 and 2018 production results highlight copper

    • Reporting what the company describes as “a solid operational performance in the final quarter of 2018”, Rio Tinto highlights the strong production profile from its copper division which delivered a 20% increase in mined production (to 177,000t) compared to Q3 2017 and an 11% increase during the final three months of the year.
    • The company also points to the US$8.6bn of disposals which include its holding in the Grasberg mine, for US$3.5bn, and the company’s remaining coal assets ($4.1bn) as well as the sale of the Dunkerque aluminium smelter for $0.4bn and land and wharfage at Kitimat in British Columbia.
    • Higher grades helped drive a 37% increase in annual copper output, to 203,900t, from the Kennecott operation in Utah although the company comments that “In 2019, the production profile will see increased variability in grade as operations mine in lower levels of the pit, together with waste stripping related to the south wall pushback expansion. Anticipated south wall pushback grades begin to increase in late-2020 and are expected to offset this variability over the longer term”.
    • Mined copper output from Escondida increased by 29% bringing the 2018 output to 350,400t “reflecting the ramp-up of production to nameplate capacity following commissioning of the Los Colorados concentrator, and the absence of a labour strike which significantly impacted 2017 production.”
    • Copper production at Oyu Tolgoi remained broadly stable at 53,300t for the year while progress on the underground project “continues to track in-line with the re-forecast undertaken in the third quarter of 2018”. The company also draws attention to the previously announced Power Source Framework Agreement between Oyu Tolgoi and the Mongolian Government which “provides a binding framework and pathway for the construction of a power plant and also sets out an amended timetable” for the 300MW plant.
    • Overall mined copper production guidance for 2019 is in the range 550-600,000.
    • Iron ore shipments from Rio Tinto’s Pilbara operations rose by 2% during the year to 338.2mt from production of 337.8mt, towards the upper end of published guidance. Guidance for iron ore shipments in 2019 is in the range 338-350mt.
    • In November 2018, the company announced the approval of the $2.6bn investment in the 43mtpa Koodaideri iron ore mine in the Pilbara to replace existing depletion of capacity. Construction is scheduled to start during 2019 with first production planned for late 2021. Rio Tinto has also, In October 2018, announced the investment of $1.55bn (Rio Tinto share $820m) to sustain production at its 53% owned Robe River Iron Joint Venture.
    • The company expensed US$488m of exploration expenditure during 2018 (2017 – US$445m). “bulk of the exploration expenditure in this quarter was focused on copper targets in Australia, Canada, Chile, Kazakhstan, Mongolia, Namibia, Papua New Guinea, Peru, Serbia,  United States and Zambia”.

    Conclusion: Rio Tinto’s copper businesses showed further growth while the company also continues its investment in iron-ore. The disposal of its coal interests and of the stake in Grasberg and other assets realised $8.6bn.


    Shanta Gold (LON:SHG) 5.5p, Mkt Cap £42.9m - $325k worth of convertibles bought back

    • The Company bought back $325k of outstanding unsecured subordinated convertible loan notes due April 2019 from El Oro ltd.
    • The Company paid $276k for convertibles implying a 18% discount to nominal value and accrued interest.
    • The remaining convertibles nominal outstanding is currently $14,675k.


    Vast Resources (LON:VAST) 0.27p, £15.5m - $5.5m Mercuria Tranche B update

    • The Company announced yesterday it will has not yet received the $5.5m Tranche B from Mercuria.
    • The management continues to expect receipt of the Tranche B facility.
    • Additionally, the Company notified that the no conversion right in regards of $1.575m received from Bergen expired today.
    • The second convertible security with a nominal value of $1.575m is expected to be issued within approximately a week of the passing of the relevant resolutions to be proposed on 31 January 2019, and is conditional on the passing of that resolution.


    Fri, 18 Jan 2019 10:45:00 +0000
    Coats Group shares unravel as Barclays starts coverage with an ‘equal-weight’ rating, 75p price target Barclays has started coverage on industrial threads manufacturer Coats Group PLC (LON:COA) with an ‘equal-weight’ stance and a price target of 75p, below the current share price to reflect some caution on the stock.

    In a note to clients, Barclays analysts said: “We think Coats has a strong position in the thread market and has the potential to drive earnings from cost-cutting a large opex budget (albeit this is a finite game) and providing global scale to bolt-on acquisitions (albeit M&A is challenging).”

    READ: Coats Group expanding into the Cloud with US$12mln purchase of software solutions provider for the apparel industries

    However, they added: “We initiate at EW as we are cautious on 1) the outlook for top-line growth which limits long-term earnings growth and 2) exceptionals which are still ~10% of EBIT.”

    The analysts said their discounted cashflow-driven price target of 75p implies a clean full-year 2018 estimates P/E of 16x and EV/EBIT of 12x.

    In mid-morning trading, Coats Group shares were 1% lower at 83.40p.

    Fri, 18 Jan 2019 10:26:00 +0000
    Avation reveals new long term aircraft lease agreement Avation PLC (LON:AVAP) told investors that it has entered into a long-term lease agreement with a South-Asian airline for one new ATR 72-600 aircraft.

    The commercial aircraft leasing firm said the new agreement covers an eight-year period and that it is on ‘market-standard terms and conditions’.

    READ: Avation on course for record profits as growth drive continues

    It expects the aircraft to be delivered at the end of next month.

    Avation noted that it expects to publish its interim results, for the six months to December 31, next month on February 21.

    Fri, 18 Jan 2019 09:57:00 +0000
    Tesla rating of Outperform reiterated as Baird says cost reductions are to be expected Tesla Inc (NASDAQ:TSLA) saw its Outperform rating from Baird reiterated as analysts said the 7% cut in the electric-car company’s workforce is “to be expected” as it introduces lower-priced versions of the Model 3.

    In an email to employees and a subsequent blog post, CEO Elon Musk cited the need to introduce less expensive Model 3s in all markets before the next US tax credit reduction on July 1. While Tesla reaffirmed in the blog post prior guidance of profitability in the fourth quarter, it said quarterly profits would be lower sequentially.

    Shares of Tesla dropped $6.80 to $323.69 in Friday’s Nasdaq trading.

    READ: Tesla shares higher as Oracle boss Larry Ellison discloses $1B stake in electric car maker

    “While headlines will likely pressure shares, we believe cost management is important to introducing the lower-priced Model 3 and an important earnings driver as Tesla transitions to its next phase of growth,” wrote Baird's Ben Kallo in a research note. “Cost reductions are to be expected and important as the company works to expand margins and lower average selling prices on the Model 3.”

    Kallo added that the tone of Tesla’s statements may have been “overly negative” in setting the stage for the workforce reductions rather than reassuring investors.

    Earlier this month, Tesla rallied after Oracle Corp. (NASDAQ:ORCL) co-founder Larry Ellison disclosed that he had a $1 billion stake in the electric-car maker.

    Contact Dennis Fitzgerald at

    Fri, 18 Jan 2019 09:50:00 +0000
    Morning Market Pulse - Ryanair winces with winter warning Mike van Dulken and Artjom Hatsaturjants at Accendo Markets, commented to clients this morning:


    FTSE 100 called to open +30pts at 6865, extending yesterday’s 6800 bounce, however unable to challenge falling highs resistance at 6880 overnight, keeps it in a falling channel since the Jan rebound highs. Bulls need a break above 6880 to escape the channel. Bears require a breach of 6860 to jeopardize yesterday’s bounce. Watch levels: Bullish 6880, Bearish 6860


    Calls for a positive open come after a strong showing from Wall St and Asian markets, undaunted by disappointing revenue and subscriber misses from Netflix. US stocks rallied after The WSJ report suggested that Treasury Sec. Mnuchin proposed China tariff relief to encourage Beijing to compromise, though equities pared gains after the Treasury denied making any recommendations.


    GBP off overnight highs, but still trading best levels since mid-November after The Times reported the DUP may be open to a softer Brexit, including membership of EU customs union. Oil prices higher, with Brent Crude trading around week highs, amidst trade optimism.


    In corporate news this morning Ryanair cuts full year profits guidance (ex-Lauda)  to €1-1.1bn (from €1.1-1.2bn), citing Winter fares -7% vs -2% guidance, although higher traffic and better unit costs has helped reduce impact; can’t rule out further cuts (fares or guidance) due to Brexit/Security.


    Rio Tinto FY iron ore production +2% YoY, upper end of guidance. Bauxite -1%, Aluminium -3%, in-line. Copper +33% beat guidance. Targets 2019 iron ore shipments flat to +3.5%, bauxite production +11-17%, but aluminium down 1-7% and Copper -5 to -13%. Shares +0.3% in Australia.


    Sophos Q3 billings -0.6% YoY, extending slowdown from +6.5% in Q1 and +3.3% in H1  which implied a flat Q2. Cash EBITDA +6.9% but free cash flow -11.3%. Expects Q3 trends to continue into Q4, with a modest decline in FY billings.


    Halma acquires Business Marketers Group, trading as Rath Communications, a provider of emergency communication systems for Areas of Refuge in the USA, for $42.4m ($16m annual revenues), expected to be immediately earnings accretive.


    Greencoat Q4 NAV +7%, Generation on budget, power prices above budget, but FY generation 6% below budget (low wind), but cash generation on budget thanks to higher prices; interim dividend flat at 1.69p; increased 2019 target dividend by 3.6% to 6.94p, in-line with RPI.


    In focus today will be UK Retail Sales (9:30am), bookending updates from many key FTSE retailers this month. Economists expect monthly sales -0.6% in December ex-fuel (-0.8% headline). If confirmed, Black Friday may be the culprit, with consumer spending pulled forward to November which posted growth of 1.2%. Annual growth ex-Fuel still expected +3.9% in Dec vs. Nov +3.8%.


    In the US, Industrial Production (2:15pm) is seen slowing in Dec (+0.2% MoM vs +0.6% prev.). Manufacturing Production, meanwhile, resumes growth after a flat November. Uni. of Michigan Consumer Sentiment (3pm) looks likely to take a hit from the US Government Shutdown (now 28 days long), with all components forecast lower in January.


    The Fed’s Williams (2:05pm, hawkish, voter) discusses US economic outlook and monetary policy (New Jersey Bankers Association Economic Leadership Forum, with audience Q&A. G20 Finance Ministers and Central Bank Governor deputies are in Tokyo for a 2-day meeting, in early preparations for this summer’s G20 summit. The ECB’s Cœuré represents the Eurozone.


    In terms of overnight/weekend risk, note  that we get China GDP, Industrial Production and Retail Sales early on Monday morning. Expectations are for another batch of slower growth, vindicating Beijing’s recent fresh stimulus to boost the economy. Watch FTSE Miners.

    Fri, 18 Jan 2019 09:48:00 +0000
    easyJet knocked by JPMorgan downgrade, as sector roiled by another Ryanair profit warning easyJet PLC (LON:EZJ) shares topped the FTSE 100 fallers on Friday, knocked by a downgrade from JPMorgan Cazenove and as the airline sector was roiled by another profit warning from Irish budget player Ryanair PLC (LON:RYA)

    In a note on European low-cost airlines, the US bank’s analysts cut their rating for easyJet to ‘neutral’ from ‘overweight’ and reduced their target price for the FTSE 100-listed firm to 1,450p from 1,800p.

    READ: Ryanair descends after profit warning as lower winter fares offset rise in traffic

    They reiterated ‘overweight’ ratings on both dual London and Dublin-listed Ryanair and on FTSE 250 budget airline Wizz Air PLC (LON:WIZZ), but also cuts target prices for the two – Ryanair to €13.00 from €19.75 and Wizz to 3,750p from 4,000p.

    In morning trading, easyJet shares were 2.2% lower at 1,143.50p, while Wizz lost 0.8% at 3,012p, and Ryanair shed 1.4% at 9.88p.

    The JPMorgan analysts said: “We consider all three to be long-term winners in the airline industry, with solid structural growth prospects.”

    They added: “Current low valuations reflect multiple investor concerns: a tough winter (too much capacity driving down fares); Europe’s slowing economy; the significant unknowns surrounding Brexit; and specific issues at RYA.”

    The analysts noted that easyJet and Ryanair are both trading at around a 30% discount to their average price/earnings since 2005.

    They said they think easyJet and Ryanair have similar upside potential but, tactically, the recent underperformance of the Ryanair presents a “mean reversion opportunity”, hence their downgrade of easyJet.

    On Wizz, which has less trading history, they said it also looks attractively valued and would consider the stock a long-term ‘buy and hold’.

    READ: easyJet, British Airways and Ryanair face demand uncertainty in 2019 as Brexit looms, says Barclays

    In an airlines sector note yesterday Barclays also cut its rating on easyJet, to 'underweight' from 'equal-weight' cut its target price to 1,200p from 1,500p.

    Barclays said it thinks the growth profile for easyJet “lacks some momentum in our view, not helped by difficult comparables and possible UK demand related risk”.

    easyJet is scheduled to deliver a first-quarter trading update next Tuesday, 22 January.  

    Fri, 18 Jan 2019 09:45:00 +0000
    Improved performance 'a validation' of Capital Drilling's strategy Capital Drilling Ltd's (LON:CAPD) chairman Jamie Boyton tells Proactive Investors 2018 was a strong year for them - especially in the second half.

    The company reported fourth-quarter revenue at US$30.5mln, down 1% from US$31mln in the preceding three month period, but, up 12.5% compared to the same quarter a year ago.

    Operational activity improved with utilisation rates measuring 59% at the end of the quarter, versus 47% in the comparative quarter of 2017, thanks to increased exploration activity in West Africa and Botswana.

    Fri, 18 Jan 2019 09:45:00 +0000
    Defense Intelligence Agency Chinese Military Power Report

    Your free daily email from Fuller Treacy Money

    Comments of the Day

    18 January 2019



    Video commentary for January 17th 2019



    Eoin Treacy's view

    A link to today's video commentary is posted in the Subscriber's Area. 

    Some of the topics discussed include: short-term bought condition replaces short-term oversold conditions. what does a higher reaction low look like, palladium accelerating higher, Pound firms and Brexit commentary, China's global ambitions, Emerging markets remain steady, Dollar steady, gold steady, high yield spreads continue to contract.



    Email of the day on reading the Brexit tealeaves

    It seems to me that the little move up in GBP and some "local" plays (banks, home builders) reflects higher chances of the UK remaining in the EU custom union.


    Eoin Treacy's view

    The Telegraph is reporting Philip Hammond told business leaders Article 50, which is the bill to remove the UK from the EU, will be extended and even be shelved in coming days. Meanwhile, close colleagues of the Prime Minister are floating the idea of a Norwegian solution which is effectively EU membership in all but name.

    The Labour Party are still hoping for an election, (of course they are), but are calling for a potential hard exit to be taken off the table and Jeremy Corbyn said today he could be willing to consider another referendum. The Cabinet office estimates a fresh referendum could take 14 months to organise. That’s seems rather long but, in any case, this saga is not going to end soon.



    Palladium Reaches Another Record as JPMorgan Sees More Upside

    This article by Rupert Rowling and Marvin G. Perez for Bloomberg may be of interest to subscribers. Here is a section:


    Palladium rose as much as 5.4 percent to $1,439.29 an ounce. It traded at $1,394.97 by 1:39 p.m. in New York. At the Comex exchange, palladium for March delivery climbed 2.3 percent.

    Investors are shrugging off signs of automotive weakness in key markets, with annual car sales in Europe falling for the first time since 2013. China also declined last year and sales in the U.S. barely rose.

    The metal will remain in a supply deficit for an eighth straight year, according to Metals Focus Ltd. Palladium’s status as a byproduct of mines in South Africa and Russia means output levels aren’t adjustable to meet short-term demand, despite the surging price.

    “Investors appear to be ignoring the fact that weak sales figures have been reported for all major auto markets in recent days,” Commerzbank analysts including Daniel Briesemann said in a note. “Instead, they are seeing news such as the planned widening of a strike to include the platinum mines of a major South African gold and platinum producer as being a good reason to buy.”


    Eoin Treacy's view

    Palladium has been rallying impressively while the other precious metals have been side-lined in terms of investor interest for the last couple of years. The collapse of platinum demand following the diesel scandal made the case for more gasoline vehicles and a demand growth cycle for palladium. However, that is not a sufficient reason for the scale of the move in palladium.



    Defense Intelligence Agency Chinese Military Power Report

    This report on China’s military readiness may be of interest to subscribers. Here is a section:

    China’s double-digit economic growth has slowed recently, but it served to fund several successive defense modernization Five-Year Plans. As international concern over Beijing’s human rights policies stymied the PLA’s search for ever more sophisticated technologies, China shifted funds and efforts to acquiring technology by any means available. Domestic laws forced foreign partners of Chinese-based joint ventures to release their technology in exchange for entry into China’s lucrative market, and China has used other means to secure needed technology and expertise. The result of this multifaceted approach to technology acquisition is a PLA on the verge of fielding some of the most modern weapon systems in the world. In some areas, it already leads the world.

    Chinese leaders characterize China’s long-term military modernization program as essential to achieving great power status. Indeed, China is building a robust, lethal force with capabilities spanning the air, maritime, space and information domains which will enable China to impose its will in the region. As it continues to grow in strength and confidence, our nation’s leaders will face a China insistent on having a greater voice in global interactions, which at times may be antithetical to U.S. interests. With a deeper understanding of the military might behind Chinese economic and diplomatic efforts, we can provide our own national political, economic, and military leaders the widest range of options for choosing when to counter, when to encourage, and when to join with China in actions around the world.


    Eoin Treacy's view

    China is building aircraft carriers and a daisy chain of military bases from the Persian Gulf back home. No one would engage in that kind of expense unless they wish to project power and protect their interests internationally.



    January 16th transcript of the Subscriber's video



    Eoin Treacy's view

    Here is a link to the automated transcript. Unfortunately, due to time constraints we haven’t managed to get the edited version ready for today but I will have it for tomorrow.

    Sometimes one can’t help but get a giggle out of the automated transcript. This appeared in the fourth line today “dead people are increasingly turning ever more bullish”. I’m not at all sure how it inserted the word dead before people but you never know it may be the universe telling us a short-term overbought condition has replaced a short-term oversold condition.









    Fri, 18 Jan 2019 09:41:00 +0000
    Breakfast News - Circassia Pharma, Milton Group, Shearwater Group and more... Set menu




    Total number of AIM Companies (Incl Susp):




    Total number of AIM Companies trading:




    *as at close of business  15 January 2019


    Standard List**  of Main Market:


    Total number of Standard List Companies


    (Incl Susp):




    Total number of Standard List Companies trading:




    *as at close of business 15 January 2019


    NEX Growth Market:


    Total number of NEX Growth Market Companies (Incl Susp):




    Total number of NEX Growth Market Companies trading:




    *as at close of business 15 January 2019


    *A corporate client of Hybridan LLP


    **  Standard Listing as defined by Hybridan LLP to be a business with strictly operational activity


    Dish of the day


    No Joiners Today


    Off the menu      


    No Leavers Today


    What’s cooking in the IPO kitchen?


    Main Market (Specialist Funds)


    The Global Sustainability Trust -aiming for attractive risk-adjusted returns by investing primarily in private market investments that are expected to have a positive environmental and social impact raising c.£200m. Due 31 Jan 2019.


    Main Market (Standard)


    Dev Clever Hldgs—Raising up to £700k gross.  The Group has invested over £600,000 in the last five years in developing proprietary software platforms and immersive frameworks to reshape the way its clients engage, acquire and retain their customers and employees through experience, rewards and incentives.  Mkt cap c. £3.7m




    Circassia Pharma (LON:CIR) - specialty pharmaceutical company focused on respiratory disease transferring from the Main Market. No funds being raised. Due 4 Feb.


    Greenfields Petroleum (TSX-V:GNF)  production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.


    Chaarat Gold Holdings—RTO, the Company intends to acquire Kapan Mining and Processing CJSC, which owns the Shahumyan medium-sized polymetallic mine in Kapan in the Republic of Armenia. No raise, market cap of £110.1m, due early Feb


    Banquet Buffet


    Miton Group (LON:MGR) 52.5p £90.6m


    FYDec18 update from the fund management group.


    AuM of £4,376m as at 31 Dec 2018 (2017: £3,823) (+14.5%)


    £1,019m net inflows for the Year (2017: £494m) (+106%)


    Average AuM for the Year was £4,369m (2017: £3,361m) (+30%)


    £25.5m of cash balances as at 31 Dec 2018 (2017: £19.9m)


    A total of 5,502,180 ordinary shares of 0.1p each in the Company acquired and cancelled during the Year at a cash cost of £2.6m (2017: 15,152,963 Ordinary Shares)


    Overall financial performance for 2018 is expected to be in line with market expectations


    FY Dec18E rev £27.4m and PBT £8.68m, Div 1.77p.


    Eddie Stobart Logistics (LON:ESL) 103.5p £393m


    FYNov18 update from the UK end to end supply chain, transport and logistics group. “Group revenues for the financial year grew 35% to approximately £843m (2017: £623.9m), ahead of market expectations. Revenues excluding contributions from our acquired subsidiaries, iForce, Speedy Freight and The Pallet Network (TPN), increased by 18%.”


    Underlying EBIT for the period was broadly in line with market expectations. 


    FY Nov18E rev £802m and PBT £51m. PE c.9x and yield nearly 6%.


    Bonhill Group  (LON:BONH) 87.5p £30m


    The “B2B media business specialising in three key areas: Business Information, Live Events and Data & Insight, announced a trading update for the 9 months ended 31 Dec 2018.


    The Board expects the Company's results for the 9 months ended 31 Dec 2018 to be ahead of market expectations with Investment News and the UK events business performing well and throughout the period the Company has taken the opportunity to continue to invest in recruiting high quality members of staff to support our future organic growth plans.”


    FYDec18E rev £7.8m and pre-tax loss £2.5m.


    FYDec19E rev £19.8m and PBT £2.2m.


    Kodal minerals (LON:KOD) 0.17p £13.1m


    Further high-grade assay results for the diamond drilling and reverse circulation drilling completed in Nov and Dec 2018 at the Company's 450km2 Bougouni Lithium Project in Southern Mali 


    Sogola-Baoule prospect focused on infill and extension drilling of the defined mineralisation and continued to high grade mineralisation including:


    18.5m at 1.52% Li2O from 99.3m in drill hole MDDH007


    14m at 1.43% Li2O from 142.5m in drill hole MDDH008


    Boumou prospect final diamond drill holes intersected multiple mineralised pegmatite veins including:


    7.5m at 1.04% Li2O from 130.3m


    Shearwater Group (LON:SWG) 2.75p £52.3m


    The “digital resilience group, announced that its portfolio company Xcina, a leading provider of governance, compliance, technology risk and information security assurance and advisory services, has secured a partnership with Moorhouse Group Limited, a UK insurance broker. This partnership is developing cyber risk technology solutions and mobile applications for the mass insurance market to provide an end-to-end response service for all policy holders.


    This partnership will see the roll-out of a series of applications and services aimed at risk assessment, threat detection, incident response, critical resource application and a virtual cyber incident response team, to address the shortfall in the number of UK SMEs purchasing adequate cyber insurance policies.”


    Character Group (LON:CCT) 522p £110m


    AGM Statement from the Designers, developers and international distributor of toys, games and giftware. “The positive momentum reported at the time of the publication of our preliminary results in Nov, driven by the Group's strong performance in the UK market in H2 2018 financial year, has continued into the first half of our 2019 financial year.  Despite disappointing performances reported by a number of retailers in recent weeks, our products maintained their popularity through the Christmas period, selling-through well at retail, and demand for our products is continuing.” “With a proven and balanced product portfolio, soon to be enhanced with new product additions and range extensions, and robust UK market demand from customers, the Group's performance and prospects remain in line with management expectations and market consensus.”


    Ironveld (LON:IRON) 1.78p £10.5m


    The “owner of a High Purity Iron, Vanadium and Titanium project  located on the Northern Limb of the Bushveld Complex in Limpopo Province, South Africa provided an update on the sampling programme to the potential off-take partner announced on 26 Sept 2018.


    The Company has now delivered sufficient tonnage to the potential off-taker for them to undertake a full kiln smelting test and expects to receive the outcome of the test in the next three weeks following which the Company anticipates that a long term off-take agreement with the off-take partner will be reached. The bulk sampling operation, combined with the increase in the vanadium price during 2018, has enhanced the profile of the Project. As a result, the Company has received numerous enquiries from potential development partners”.


     LoopUp Group (LON:LOOP) 320p £176m


    The “premium remote meetings company, announced that it has signed a material contract renewal with leading global law firm, Clifford Chance.


    The minimum total contract value of £2.34m in aggregate over the 3-year term is for the provision of conference calls across Clifford Chance's global operations, spanning 32 major financial centres in the Americas, Asia Pacific, Europe, the Middle East and Africa.


    The LoopUp product is typically offered on a pay-as-you-go, per minute per guest basis. However, this renewal with Clifford Chance on a guaranteed minimum spend basis is a mark of their commitment to the Group's differentiated product over the long-term.”


    Everyman Media Group (LON:EMAN) 205p £145.5m


    Everyman announced that it has appointed Streisan Bevan as an independent NED of the Company on 18 Jan 2019.


    Streisan has over 20 years digital marketing and innovation experience within the technology sector, having worked at leading global brands including Facebook, and Microsoft. She spent the last 10 years at Facebook UK, in a variety of senior roles across both commercial and technology focused teams. Mrs Bevan brings a wealth of digital marketing experience on how growing companies can ensure they continue to keep the customer at the core of their strategy.



    Fri, 18 Jan 2019 09:34:00 +0000
    Miton Group under pressure as volatile equity markets hit inflows Weak equity markets have taken a toll on small-cap fund manager Miton Group PLC (LON:MGR) with a sharp slowdown in new money incoming in the final months of last year.

    Funds under management rose 14% to £4.4bn in 2018 but a £1bn inflow of new money was countered by a £466mln decline in the value of Miton’s portfolio of funds, all of which was in the final three months.

    READ: Miton Group shares jump as it increases assets under management by 35%

    Net inflows also dropped to £92mln from over £300mln in each of the previous three quarters.

    Earnings for the 2018 year are expected to be in line with expectations but brokers have said they will cut forecasts substantially for 2019 as the weak fourth quarter washes through.

    Peel Hunt expects to lower its 2019 estimate by 15-20% though it adds Miton did still generate inflows in its fourth quarter which was a strong result given outflows seen elsewhere.

    The broker has cut its share price target to 60p from 73p.

    Shares fell 6% to 49.5p.

    Fri, 18 Jan 2019 09:08:00 +0000
    Netflix adds 8.8mln subscribers in final quarter after releasing movie hits Bird Box and Roma Netflix Inc (NASDAQ:NFLX) added 8.8 million paid subscribers in the fourth quarter as the release of original content such as Bird Box, Roma, Sex Education and You proved popular.

    The number of new subscribers represented a 34% increase on the same period a year ago, bringing its total customer base to 139 million. The new subscribers included 1.53 million in the US.

    However, shares fell 2.8% immediately after releasing the results on concerns about how much the company is spending on original content to fend off competition from the likes of Amazon, Apple, Hulu and HBO.  Much of the spending, which analysts estimate amounted to US$13bn last year, has been funded with debt.

    Netflix said its spending is likely to increase this year.

     “Our multi-year plan is to keep significantly growing our content while increasing our revenue faster to expand our operating margins,” the company said in a letter to investors.

    "Our growth is based on how good our experience is.”

    Revenue misses but profit beats expectations

    Revenue in the quarter rose 27% year-on-year to US$4.19bn, falling just shy of analysts’ expectations of US$4.21bn.

     Net income fell to US$133.9mln, or 30 cents a share, from 41 cents a share a year ago but this beat market forecasts of 24 cents a share.

    The group said its decision to raise prices in the US and some countries in Latin America and the Caribbean, announced this week, could add some US$1bn to revenue.

    READ: Netflix raises prices in US to cover soaring content costs

    Netflix will also look to increase prices in other nations as currencies fluctuate. However, it warned that the price rises could fall behind exchange rate movements, hitting revenues.

    More cash going out than coming in, says analyst

    George Salmon, equity analyst at Hargreaves Lansdown, told investors not to be fooled by the share price reaction to Netflix’s latest numbers.

    “The shares had been up by 50% since Christmas Eve, and the numbers are well ahead of the group’s guidance from its last statement in October.”

    He added: “Still, despite the glowing results there is a basic anomaly in Netflix’s numbers. Accounting rules mean the group has reported a profit of US$1.6bn, but the US$13bn investment in titles like Bird Box and Narcos means on a cash basis, more is going out than coming in.”

    On Netflix’s price hikes, Salmon reckons the company is still offering good value considering consumers spend on average about 10 hours per week on the service, which works out to about 25 cents per hour.

    “You can only squeeze customers so far, but we think there’s a way to go before the pips squeak,” he said.

    “The worry, of course, is that international bruisers like Disney and Amazon aren’t going to go down without a fight, and both have the financial clout to counterpunch pretty hard. The battle for viewers’ eyeballs is only just getting started.”

    Bird Box and Roma among successful releases

    Last year Netflix particularly focused on films, including the release of Bird Box and Roma.

    Bird Box, starring Sandra Bullock, had been viewed by 80 million subscribers in the four weeks since it was released over the holidays and is expected to contend for some of Hollywood’s top prizes.

    Roma, from Academy Award winner Afonso Alfonso Cuarón, has been playing at cinemas since its release last October. 

    Fri, 18 Jan 2019 08:58:00 +0000
    AFC Energy successfully tests world first hydrogen electric vehicle charger AFC Energy PLC's (LON:AFC) Adam Bond spoke to Proactive London's Andrew Scott after announcing they'd successfully demonstrated the world’s first electric vehicle charger based on hydrogen fuel-cell technology.

    Dubbed CH2ARGE, the technology was put through its paces at Dunsfold Aerodrome.

    The demonstration was the culmination of 10 years of fuel cell research development at the AFC Energy laboratories.

    Fri, 18 Jan 2019 08:51:00 +0000
    Greencoat UK Wind higher as it reports rise in fourth quarter net asset value, hike in 2019 target dividend Greencoat UK Wind PLC (LON:UKW) saw its shares rise on Friday as the wind farm investment group revealed that its unaudited net asset value increased to £1,392.8mln, or 123.1p per share as of 31 December 2018.

    The FTSE 250-listed firm said this represents an increase of 8.1p per share for the fourth quarter - in addition to dividends paid of 1.69p – with 6.7p of the rise attributable to amending the assumed asset life from 25 to 30 years on a conservative basis, following a third party technical assessment of its portfolio.

    READ: Greencoat UK Wind adds more capacity in Scotland with Douglas West purchase

    The company added that, during the fourth quarter, generation was on budget and power prices were above budget. However, it noted, generation for the full year was 6% below budget due to low wind resource, although cash generation was on budget owing to higher power prices.

    The company also announced a quarterly interim dividend of 1.69p per share for the quarter ended 31 December 2018 and an increase in the target dividend for 2019 to 6.94p per share, in line with the Retail Prices Index for December 2018.

    Greencoat UK Wind said it will release its annual results for the period to 31 December 2018 on Thursday 28 February 2019.

    In early morning trading, Greencoat UK Wind shares were 3.9% higher at 134.40p.

    Fri, 18 Jan 2019 08:50:00 +0000
    Bonhill jumps as it upgrades forecasts Shares in Bonhill Group PLC (LON:BONH) jumped in early trading Friday after the B2B media group upgraded its forecasts.

    In a trading update for the nine months to December 31, Bonhill said it expected results to be “ahead of market expectations” after forecasting record revenues for its InvestmentNews business of around US$19mln for the 2018 calendar year, an increase of 14%.

    Since its acquisition in August, Bonhill said InvestmentNews was expected to have generated £6mln in revenues. All the firm’s business units reported higher revenues in the period, with the total for the company up 10% in the final quarter.

    The group’s UK based events business generated sales of £500,000 from three new events launched in the final quarter; "Women in IT" in Ireland and San Francisco, and "Women in Finance" in Ireland. For the nine months, the segment had doubled its sales year-on-year.

    The group’s flagship event, Women in IT London, is to be held on January 30 with sales at 35% and ahead of those for last year’s event.

    UK media sales had seen “improved momentum” in the final quarter, Bonhill said, with sales expected to be in line with the year-ago period.

    Simon Stilwell, chief executive of Bonhill, said: "I am delighted with how well InvestmentNews has been integrated into the Group and it is performing well. There are clearly major opportunities to develop the brand further which we will do in the years ahead. We are continuing to invest across the business, particularly in high calibre team members to drive the business ahead and look forward to another year of growth and development with confidence."

    Shares were up 5.7% at 92.5p.

    Fri, 18 Jan 2019 08:41:00 +0000
    Shearwater's Xcina arm teams up with Moorhouse to develop apps for cyber insurance market Data technology firm Shearwater Group PLC (LON:SWG) said its portfolio company, Xcina, has hooked up with the insurance broker, Moorhouse Group.

    Xcina, which specialises in governance, compliance and information security issues, will work with Moorhouse to develop cyber risk technology solutions and mobile applications for the mass insurance market to provide an end-to-end response service for all policyholders.

    READ: Shearwater sales rise overshadowed by widening losses

    The partnership will see the roll-out of a series of applications and services aimed at risk assessment, threat detection, incident response, critical resource application and a virtual cyber incident response team, to address the shortfall in the number of UK small and medium-sized businesses purchasing adequate cyber insurance policies.

    The first app is due to hit the cyberstores next month and will be made available to Moorhouse’s client base, which numbers in excess of 46,000.

    Shearwarter said the app will enable businesses to maintain appropriate insurance levels and access remedial cyber services to address critical weaknesses.

    "This partnership is a significant development for Xcina as it continues to drive our national digital resilience agenda. Moorhouse shares our commitment to providing bespoke, tailored solutions that ensure SMEs have the right policies, processes and technologies in place,” declared Mo Stevens, the chief executive officer of Shearwater.

    "It is estimated that more than 60% of UK businesses describe their cyber insurance as not being based on an accurate assessment of their firm's individual risk. Our collaboration will help address this within the insurance market,” he added.

    Lyndon Wood, the chief executive officer of Moorehouse, said the collaboration with Xcin underscored its commitment to enabling small and medium-sized business to accurately assess their risk profile and therefore choose the right cyber insurance policy.

    Fri, 18 Jan 2019 08:35:00 +0000
    Revenues accelerate at truck firm Eddie Stobart Iconic trucking group Eddie Stobart Logistics PLC (LON:ESL) increased revenues 35% in its latest financial year as acquisitions and new contract wins combined. 

    Group revenues to end November rose to £843mln from £624mln, which was better than the market forecast.

    Organic growth excluding acquisitions iForce, Speedy Freight and The Pallet Network (TPN) was 18%, while there were £162mln of new contract wins.

    Margins improved in the second half and are expected to pick up further in 2019 with underlying profits broadly in line with expectations.

    Net debt jumped to £154mln (£109.5mln), reflecting working capital investment required to support the significant levels of sales increase and the additional debt associated with the purchase of TPN.

    Fri, 18 Jan 2019 08:28:00 +0000
    Ironveld delivers sample tonnage to potential off-taker Ironveld plc (LON:IRON) told investors that it has delivered sufficient tonnage of sample material to its potential off-take partner.

    The company, which is advancing the High Purity Iron project in South Africa’s Bushveld region, noted that the potential buyer can now carry out a full kiln smelting testing.

    It subsequently expects to receive the outcome of the test in the next three weeks. After that, the company expects that a long term deal will be reached.

    READ: Ironveld final results for 2018

    "Our sampling programme is progressing to plan and we are confident of reaching a long term off-take agreement with our potential off-take partner, which would generate significant revenue for Ironveld,” said Peter Cox, Ironveld chief executive.

    “I look forward to updating the market further in due course."

    Ironveld highlighted that the project’s profile has been boosted as a result of the bulk sampling and rising vanadium prices.

    Numerous enquiries have been received from potential development partners, a number of whom have carried out extensive due diligence.

    It continues to evaluate all enquiries and will update shareholders with further developments as appropriate.

    Fri, 18 Jan 2019 08:24:00 +0000
    Bakkavor confirms full year expectations in “robust” update Bakkavor Group PLC (LON:BAKK) has confirmed its guidance for the full year despite what it said was “weak” consumer confidence in the UK.

    In a full year trading update, the group said like-for-like revenues had risen 3.2% compared to 2017.

    UK LFLs rose 1.8% despite the weaker consumer confidence, however, this paled in contrast to the firm’s international business where LFL revenues surged 16%.

    The FTSE 250 firm said in the current economic climate it considered its performance “robust” and confirmed its full-year expectations were unchanged.

    Bakkavor is the leading provider of fresh prepared food in the UK, supplying grocery chains such as Tesco PLC (LON:TSCO), Marks & Spencer Group PLC (LON:MKS), J Sainsbury plc (LON:SBRY), and Waitrose.

    In a note to clients, analysts at broker Peel Hunt said that while the company was “strengthening” its market position with a material new desserts business and the acquisition of bakery chain Haydens in September, it would need to gain share to “materially outperform” the underlying sales of its four core customers, which comprise 87% of its UK sales.

    The broker added that as Bakkavor was focused on maintaining its margins and would not chase business at its expense, volumes were forecast to show “moderate growth” of 1.5% with margins close to the prior year.

    “In order for margins to progress, we need to see improved volume growth and/or lower input costs.”

    In early trading Friday, Bakkavor shares were up 0.3% at 140.4p.

    --Adds share price--

    Fri, 18 Jan 2019 08:15:00 +0000
    Record posts drop in quarterly assets under management amid market volatility Record PLC (LON:REC) reported a 6.5% drop in quarterly assets under management equivalent (AUME) amid global market volatility.

    The currency manager said AUME in the quarter ended December 31 totalled US$57.8mln, down from US$61.8mln at the end of September.

    Volatility in global stock markets had a US$2bn impact on AUME, while exchange rate movements carved US$0.9bn off the total.

    Client numbers fell to 65 at the end of the period from 66 clients in the previous quarter.

    The company said a commercial relationship, representing two clients and US$1.7bn of AUME, in its passenger hedging markets business is expected to terminate imminently.

    Record earned performance fees of £1.3mln, broadly unchanged from the prior quarter.

    READ: Record shares on the up after resilient first half performance

    "We continue to see a range of new business opportunities across products and client locations, balanced against competition and fee pressure,” said chief executive James Wood-Collins.

    “With our diversified product suite and our ability to offer tailored solutions, we aim to make further progress in the rest of this financial year and the next."

    Fri, 18 Jan 2019 08:09:00 +0000
    Sophos expects subdued trading conditions to continue Cybersecurity outfit Sophos Group PLC (LON:SOPH), which issued a profit warning in November, said its performance continued to be subdued sending its shares down by over a fifth.

    In the final three months of 2018 – the third quarter of the company’s fiscal year – billings were up 2% year-on-year on a constant currency (CC) basis.

    READ: £400mln wiped from Sophos’s value as it fails to repeat two key targets for next year

    The group now expects the trends in the fiscal third quarter to generally continue into the current quarter, which would result in a modest decline in full-year billings on a CC basis.

    Group revenue rose 7.3% to US$178.0mln from US$165.9mln the year before, driven by a 15% increase (on a CC basis) in subscription revenue.

    Year-to-date performance is a mixed bag

    In the first nine months of the fiscal year, adjusted operating profit was up 157% on the same period of 2017, while reported operating profit of US$51mln marked a move into the black after the company made a loss of US$25mln in the corresponding period of 2017.

    Cash earnings before interest, tax, depreciation and amortisation (EBITDA) was down 8% year-on-year.

    Net cash flow from operations clocked in at US$100mln while ungeared free cash flow was broadly unchanged from a year earlier.

    "Sophos remains strongly positioned from a technology, product, and strategic perspective. We are confident in our strengthening product platform and how it positions us for the future,” said Kris Hagerman, the chief executive officer of Hagerman.

    Slowing billings growth

    Russ Mould, investment director at AJ Bell commented: “Cybersecurity is a growth area but that does not mean companies operating in this space are guaranteed to be successful – Sophos being a case in point.

    “Its third-quarter update showed a return to profit backed by double-digit growth in revenue. “However, the level of billings – or new business invoiced in the period under review – offers a better measure of how sustainable growth is. Revenue, after all, can include income from previously-agreed contracts.

    “Here the picture is much less encouraging. Billings were up just 2% in the third quarter and 2% for the financial year-to-date. And this is giving investors the collywobbles, just as it did when Sophos reported billings growth of 3% in a first-half update.”

    Mould continued: “The slowing billings growth is putting cash earnings under some pressure and suggests that, unless the company has something spectacular up its sleeve for the fourth quarter, full-year expectations will have to be downgraded.

    He concluded: “The company enjoyed a strong run following its summer 2015 stock market debut, but the shares have halved in the last 12 months.

    “They now trade just 25% higher than the 225p issue price from the IPO and 17% up on the closing price on the first official day of trading. As such, chief executive Kris Hagerman’s position may be coming under increasing scrutiny.”

    In late morning trading, Sophos shares were 22.3% lower at 292.80p.

     -- Adds analyst comment, updates share price --

    Fri, 18 Jan 2019 08:05:00 +0000
    Halma pays US$42.4mln cash for a provider of emergency communication systems for Areas of Refuge in the USA Halma PLC (LON:HLMA) is expanding across the Atlantic with the  US$42.4mln (£32.6mln) cash acquisition of Business Marketers Group Inc., which trades as Rath Communications, a provider of emergency communication systems for Areas of Refuge in the USA.

    The FTSE 100-listed safety, health and environmental technology group said the acquisition was completed on 17 January 2019 and is expected to be immediately earnings enhancing.

    READ: Halma delivers record first-half profit and revenue, sees rosy future

    It added that Wisconsin-based Rath, which will become part of Halma's Infrastructure Safety Sector, had unaudited revenue for the financial year ended December 2018 of US$15.9mln (£12.2mln).

    The group said the consideration for Rath, made on a cash and debt free basis, was funded from Halma's existing facilities.

    Andrew Williams, the company’s chief executive, commented: "Rath extends Halma's safety communications capabilities and adds a new market niche with its strong position in the Area of Refuge communications market in the USA, where growth is being supported by tightening regulatory standards.”

    He added: “Rath is also well positioned to benefit from Halma's strategic Growth Enablers, bringing the potential for collaboration with other Halma businesses in elevator safety and healthcare to drive expansion into adjacent markets focused on the care and safety of the elderly and disabled people.”

    In a note to clients, analysts at Shore Capital pointed out that the Rath deal “will add a niche market to Halma’s safety communications capabilities – area of refuge communications.”

    They noted: “This market is experiencing tightening regulations, which would help protect Halma’s earnings.”

    Shore Capital reiterated a ‘hold’ rating on Halma shares.

    In mid-morning trading, the blue-chip stock was 0.7% higher at 1,395p.

     -- Adds analyst comment, share price --

    Fri, 18 Jan 2019 08:00:00 +0000
    Kazera Global highlights encouraging drill results in Namibia Kazera Global PLC (LON:KZG) told investors that its drill programme at its Namibia Tantalite Investment (NTI) mine project continues to produce highly encouraging results.

    The company noted that it has so far drilled 22 of 33 planned holes at NTI, and, assays have been produced for 432 core samples and 72 channel samples.

    "The drilling programme continues to produce highly encouraging results with encountered mineralisation indicating the potential to produce lithium and tantalum commercially,” said Larry Johnson, Kazera chief executive.

    READ: Kazera Global focused on its targeted exploration programme

    “We still anticipate having the initial ore resource report in Q1 2019 on Homestead and Purple Haze, after which we can start to formulate the highest value mine plan for the total area.

    “We look forward to updating shareholders on our progress in the near future."

    At Homestead, sampling work has concluded and the company noted that visual observations indicate that the spodumene and subordinate lepidolite mineralisation contain lithium mineralisation, and, that Tantalum mineralisation is hosted in the tantalite deposits.

    Highlight drill results included lithium grades up to 1.7% and tantalum measuring 2,350 parts per million.

    Meanwhile, at the Purple Haze project area drilling continues to comprehensively test tantalum and lithium bearing pegmatites.

    The programme is due to complete in the first quarter and subsequently, it plans to move the drilling campaign to the Signaalberg area.

    Kazera notes that its technical advisers expect to produce an ore resource report for Homestead and Purple Haze by the end of the first quarter.

    Drilling will take place at the Signaalberg and White City pegmatites in the next few months so during this year those areas will be moved towards ore resource reports.

    At the same time, Kazera said it continues talks with several interested parties to become the sole off-taker of tantalum and lithium, detailed due diligence is ongoing.

    Fri, 18 Jan 2019 07:57:00 +0000
    Property and construction firm Henry Boot beats Brexit gloom Property and construction firm Henry Boot PLC (LON:BOOT) said it would have been on course to exceed guidance but for a one-off pension contribution.

    Its performance came in the face of more challenging trading conditions as negotiations around the UK's departure from the EU “served to increase the level of uncertainty within the UK real estate market”.

    The company said its Hallam Land Management business “performed exceptionally well”, Stonebridge Homes turned over £35mln and construction “held up well”.

    Henry Boot Developments' results were affected by the aforementioned macro uncertainty.

    That said boss John Sutcliffe was guardedly optimistic on prospects: "Although we remain mindful of some uncertainty in the UK real estate market, these transactions, added to the already committed and contracted activity for 2019, give us a good start to the year."

    Fri, 18 Jan 2019 07:55:00 +0000
    Kodal Minerals plans larger operation at Bougouni in Mali Kodal Minerals PLC (LON:KOD)  is considering a larger mine at its Bougouni lithium mine in Mali following another strong set of drill results.

    The junior is now eyeing an initial 1.2 mln tonne a year processing plant, expanding to 1.5 mln tonnes pa as the operation moves into a steady production phase.

    Recent assays contained lithium at grades between 1.2% and 1.7% at Sogola-Baoule and 1.04% at Boumou.

    Assay results are pending for a further 2,732 samples with a mineral resource estimate update expected by the end of February.

    Bernard Aylward, chief executive said the drilling at the end of last year had confirmed the continuity and robustness of the lithium mineralisation at Bougouni. 

    “This gives us great confidence as we continue to fast track our development plans for the Project. 

    “As such, we are in the process of completing a Mineral Resource estimate update that will include all drilling results to date as we look to confirm a long term mine life.   

    "The opportunity highlighted by these continuing good results is that we are now able to assess our proposed operation parameters and factor in a larger mining operation with an initial 1.2Mtpa processing plant, expanding to 1.5Mtpa as the operation moves into steady production phase.”

    Fri, 18 Jan 2019 07:51:00 +0000
    RBS seeking to buy back up to £1.4bn worth of bail-out shares from the UK government Royal Bank of Scotland PLC (LON:RBS) has revealed that it is looking to buy up to £1.4bn worth of shares from the UK government as part of efforts to cut the publicly owned stake in the rescued lender.

    In a statement released after the London markets close on Thursday, the FTSE 100-listed bank said it would seek shareholder approval to buy a stake of up to 4.99% from the Treasury at a general meeting in Edinburgh scheduled for February 6.

    READ: RBS's dividend signals a return to strong dividend growth for banks but elsewhere profit warnings are a concern

    The move would reduce the taxpayer’s holding in RBS – which received a £45bn government bail-out during the 2008 financial crisis – to 60.3% from around 62.3% currently.

    The bank said the shares bought would be cancelled, resulting in a smaller percentage cut in the government’s total stake because there would be fewer shares in circulation.

    The Treasury disposed of 7.7% of its holding in RBS for £2.5bn last year and has said it plans to sell its entire stake by 2023-2024.

    RBS’s move follows months of speculation about how the bank will use its excess cash, having already spent £240mln on its first shareholder dividend in a decade last October.

    Howard Davies, RBS’s chairman commented: “This resolution would provide the bank with the flexibility to use some of its excess capital to buy back government shares at a time and price agreed with HM Treasury.

    “The board believes that this is in the best interests of the bank and its shareholders by helping to facilitate the return of the company to full private ownership.”

    Fri, 18 Jan 2019 07:41:00 +0000
    Ryanair descends after profit warning as lower winter fares offset rise in traffic Ryanair Holdings PLC (LON:RYA) shares turned down in early trading Friday after it cut its full-year profit guidance as lower fares in the winter period offset a rise in traffic.

    The budget airline lowered its guidance for the 2019 fiscal year to between €1bn-€1.1bn from a previous range of €1.1bn-€1.2bn, blaming the reduction on lower-than-expected winter fares which are now expected to fall 7% as opposed to previous guidance of a 2% drop.

    READ: Ryanair’s wings clipped by Berenberg downgrade to ‘sell’, sees ‘value trap’ for low-cost airlines

    This had offset a stronger-than-expected growth in traffic, which was up 9% at 142mln compared to previous guidance of 141mln.

    There had also been stronger sales in ancillary services as more customers had chosen lower cost optional services, as well as a slightly better-than-expected unit cost performance in the second half of the year.

    The new guidance did not include exceptional start-up losses from the group’s Lauda airline, which had been cut to €140mln from €150mln on the back of a better-than-expected unit performance over winter.

    Michael O'Leary, Ryanair’s often outspoken chief executive, said while the firm was “disappointed” at the new guidance, the stronger than expected traffic and ancillary revenue figures would help to “defray” the impact of the lower winter fares.

    He added that the lower fare environment would continue to "shake out” loss-making competitors such as WOW, FlyBe, and Germania, all of which are currently for sale.

    However, looking forward O-Leary said the airline could not rule out further cuts to airfares and “slightly lower” full-year guidance if there were unexpected Brexit or security developments which would impact yields from now until the end of March.

    READ: Ryanair slashes profit guidance on strike impact and higher oil prices

    The profit warning is the second from the airline in four months, having previously cut its full-year guidance to €1.25bn from €1.35bn in October on the back of staff strikes, passenger compensation costs, and high oil prices.

    Ryanair will release its third-quarter results on 4 February.

    Warning “problematic” given sector uncertainty, says analyst

    Neil Wilson, chief market analyst at, said the profit warning was “problematic” for the airline sector given the current state of uncertainty, adding that the lower guidance was indicative of higher pressures on Ryanair's cost base as labour costs rose, affecting its low-cost, high margin model.

    He added that the Brexit uncertainty made for “a very uncertain period for airlines”, although larger carriers like Ryanair, easyJet PLC (LON:EZJ), and International Consolidated Airlines Group (LON:IAG) which own British Airways, were set to win out from consolidation in the sector.

    The sector jitters were on full display in early deals, with Ryanair shares falling 1.6% to 9.9p. This was accompanied by easyJet shares slumping 2.5% to 1,139.5p while IAG fell 1.1% to 609p.

    Fri, 18 Jan 2019 07:39:00 +0000
    Peppa Pig firm Character Group beats retail gloom to provide upbeat update Peppa Pig and Pokemon rights owner Character Group PLC (LON:CCT) said the business momentum reported in November has continued into the company’s new financial year as it confirmed “performance and prospects” remained in line with management’s expectations.

    Ahead of the company’s annual meeting, the toys, games and gifts company told investors: “Despite disappointing performances reported by a number of retailers in recent weeks, our products maintained their popularity through the Christmas period, selling-through well at retail, and demand for our products is continuing.”

    In the update, Character admitted the US continued to be “challenging” while the remainder of its overseas markets were “steady”.

    Keeping up with the latest trends 

    It said its broad portfolio of toys and brands helped underpin growth as it followed the trends with the additions of Slo Squishies, Cra.Z.Slimy, Mashems and Treasure X to the portfolio.

    In October it bought a 55% stake in Danish toy distributor OVG-PROXY, which is benefiting from logistical support from the wider group.

    However, it has been hit by a “short-term” setback in the form of one of its major customers going bust.

    “In any event, recent events in the market have shown that the market share of fallen retailers is quickly absorbed by other established retailers,” shareholders were told. 

    “In the circumstances, we remain confident that the acquisition will prove to be beneficial to the group.”

    Fri, 18 Jan 2019 07:34:00 +0000
    LoopUp bags significant contract renewal with law firm Clifford Chance LoopUp Group PLC (LON LOOP), the remote meetings technology company, has signed a material contract renewal with a leading global law firm, Clifford Chance.

    The minimum total contract value of £2.34 mln in aggregate over the three-year term is for the provision of conference calls across Clifford Chance's global operations, spanning 32 major financial centres in the Americas, Asia Pacific, Europe, the Middle East and Africa.

    READ: LoopUp dials up strong first half as MeetingZone acquisition delivers

    The LoopUp product is typically offered on a pay-as-you-go, per minute per guest basis; however, this renewal with Clifford Chance is on a guaranteed minimum spend basis.

    To put the size of the deal into perspective, LoopUp’s total revenue in 2017 was £17.5mln. The group is set to give a trading update on 2018’s performance on February 12.

    “Our people have really taken to LoopUp, and we're pleased to demonstrate our commitment to the company and product with this major renewal,” said Paul Greenwood, the chief information officer of Clifford Chance.

    Steve Flavell, the co-chief executive officer of LoopUp Group, said conference calls form a critical component of Clifford Chance’s important day-to-day interactions with their clients.

    “The quality of these calls – both from a user experience and audio quality perspective – is paramount, and we're delighted to receive this endorsement in our product and customer service from such a leading global firm," Flavell said.


    Fri, 18 Jan 2019 07:33:00 +0000
    Rio Tinto raises target for iron ore exports this year after meeting guidance in 2018 Rio Tinto PLC (LON:RIO) raised its target for iron ore shipments this year after delivering a 2% increase in 2018 exports, in line with expectations.

    The miner said iron ore shipments from Australia’s Pilbara region came to 338.2mln tonnes, up from 330.1mln tonnes a year ago, supported by investments in productivity improvements, minimal weather disruptions and the ramp-up of expanded mine sites.

    However, iron ore prices fell 4% to US$62.5 per dry metric tonne. 

    READ: Rio Tinto offloads stake in Namibian uranium mine to Chinese firm

    For 2019, the group set a target of 338mln tonnes to 350mln tonnes. The company said a fire that broke out at one of its major ports in Pilbara on January 10 would result in “limited disruption” on its shipments of Robe Valley lump and fine iron ore products.

    The fire at Rio Tinto’s Cape Lambert Port near Karratha damaged a part of the plant that separates the two products, leading the company to declare “force majeure” on its contracts with affected customers. However, the fire did not impact exports of the miner’s premium product, ‘Pilbara blend'.

    Iron ore accounts for the biggest share of the miner’s earnings but copper production was the standout performer last year, rising 33% year-on-year to 634000 tonnes.

    Copper production growth was led by a strong performance at the Escondida mine in Chile and US business Rio Tinto Kennecott.

    “We delivered a solid operational performance in the final quarter of 2018, in particular across our copper assets,” said Rio Tinto chief executive Jean-Sebastien Jacques.

    “During the year, we further strengthened our asset portfolio, continuing to invest in high-quality growth. 2018 saw the early completion of Amrun, the deployment of AutoHaul™, the Koodaideri and Robe River investments and the signing of the power agreement at Oyu Tolgoi.”

    Last year the company sold US$8.6bn worth of business, including the Grasberg mine in Indonesia and remaining coal assets. 

    Goldman Sachs kept a 'neutral' rating on the stock but cut its target price to 4,100p from 4,200p to reflect its downwardly revised earnings estimates. 

    "While the 62% iron ore price (the majority of Rio’s iron ore sales) has been strong, we believe that as the market concerns we have highlighted intensify, iron ore prices will come under greater pressure," Goldman said.

    "We would expect this to be a negative for Rio, as more than 60% of the company’s 2019E EBITDA comes from iron ore."

    Shares in Rio were up 0.49% to 3,916p in morning trading. 

    Fri, 18 Jan 2019 07:30:00 +0000
    Providence Resources upgrades Avalon to frontier exploration licence Providence Resources PLC (LON:PVR) told investors that the acreage hosting the Avalon prospect will be upgraded from a licence option to a frontier exploration licence.

    The Irish offshore explorer, in a statement, said that the Minister of State at the Department of Communications, Climate Action and Environment in Dublin has approved the change effective from February 1.

    READ: Providence Resources confirms Barryroe progress

    “Avalon is a very large and exciting prospect, which lies adjacent to Dunquin North, and the JV partners look forward to progressing it further under the operatorship of TOTAL,” said Dr John O’Sullivan, Providence technical director.

    Total agreed to farm into the exploration project back June 2017 and, assuming it advances to drilling, the partner has committed to covering 60% of the well costs up to a cap of US$40mln.

    Fri, 18 Jan 2019 07:18:00 +0000
    Cobalt set for bearish 2019 but demand fundamentals remain strong Following strong upwards trends in 2017, the cobalt price in 2018 climbed to reach an all-time high of US$95,250 a tonne in March before plummeting more than 50% by year-end.

    The market volatility across the year was shared by most other base metals, fuelled by the US-China trade dispute as well as China’s contracting economy.

    Market sentiment for cobalt shifted further due to announcements from major battery makers such as Tesla to decrease the amount of cobalt to be used in their batteries.

    It was also affected by a supply-side response in the form of larger artisanal production from the Democratic Republic of Congo (DRC), which put medium-term pressure on prices.

    Six-year cobalt price. Source:


    Strong demand fundamentals

    Production from the DRC has added to volatility due to considerations of ethically-sourced cobalt and the country’s recent contested elections.

    Nonetheless cobalt demand remains strong and its use in lithium-ion batteries will potentially triple by 2026.

    This was given a jump-start late last year when Katanga Mining (TSX:KAT) halted export sales at its Kamoto mine in the DRC after identifying uranium in its cobalt production.

    Cobalt demand increased at a rate of 8% per year from 2010-2017, according to Roskill, mainly driven by demand from the battery sector which now accounts for more than half of total cobalt consumption.

    Demand for cobalt in batteries is predicted to grow at 14.5% a year to 2027, which, coupled with increases in other end-uses such as nickel alloys used in aerospace, paint a rosy picture for cobalt outlook across the next decade.

    ‘Demand will continue to grow’

    The 2018 price correction was expected by some analysts, with Benchmark Mineral Intelligence analyst Casper Rawles noting he had anticipated the market to correct but was somewhat surprised by how much.

    Rawles said: “There were some exceptions to the rule, but from the end of quarter one and throughout 2018, we’ve seen prices decreasing and continuing to fall.”

    Explaining the downward trend, Rawles pointed to the increase in the price basis of raw material feedstocks from the DRC going into China and the resulting credit availability and cash flowing in China.

    He remained cautious looking ahead, saying “demand will continue to grow, consumption of lithium-ion batteries is going to grow, but as of right now there’s enough cobalt around to meet the needs of the market”.

    Rawles expects the recent election uncertainty in the DRC to potentially have small supply disruptions but these would be short-lived and have no impact on prices.

    Advanced technology applications

    Most cobalt is mined as a by-product of copper or nickel and is reliant on the strength of those markets.

    The US Geological Survey estimates that 43% of world cobalt production in 2015 was from copper mining and 44% from nickel.

    There is only one modern primary cobalt operation, the Bou-Azzer mine in Morocco, but that only contributes around 2% to global production.

    Cobalt is useful in the manufacture of varying products due to its ferromagnetism and wear-resistance when alloyed with other metals.

    The transition metal retains its magnetism at high temperatures and can be used in advanced technology applications as well as in superalloys and as a refining catalyst.


    Diversification of supply sources

    More than 60% of the world’s cobalt production comes from the DRC, of which 10-25% is estimated to be artisanal in nature.

    According to the US Geological Survey, total global cobalt production in 2017 was 110,000 tonnes, down from 111,000 tonnes the previous year.

    The DRC contributed 64,000 tonnes in 2017 with Russia in second place at 5,600 tonnes.

    Australia and Canada, the third and fourth highest producers respectively, have had added interest as cobalt jurisdictions due to stable mining codes, established supply chains and promising cobalt developments.

    Darton Commodities Limited estimates that annual cobalt demand will exceed 120,000 tonnes by 2020, with further demand growth linked to potential technological advancements in the battery space.

    The global hybrid and electric vehicle market grew by 33.2% in 2017, according to MarketLine data, and demand is predicted to keep rising through 2020.

    This could potentially create substantial shortages in cobalt as early as 2022 with current production estimates.

    A number of companies are actively developing cobalt projects in Australia and Canada which may soon begin contributing to global production if demand predictions and supply-side challenges persist.

    Chinese contraction causes medium-term price weakness

    Data shows China’s gross domestic product (GDP) has decreased for the past five consecutive quarters and the country’s leader Xi Jinping has remained vague on Beijing’s plans for a wider economic stimulus.

    In terms of both supply and consumption China is a key market for base metals and its economic growth has a strong impact on prices and market sentiment.

    According to Darton Commodities, China accounts for more than 80% of the production of cobalt chemicals and it remains a key producer of batteries.

    Overall 2018 GDP growth for China is anticipated to be 6.6% and it is expected that the Chinese government will lower its economic growth target to 6%-6.5% in a March parliamentary session.

    Forecasts from the International Monetary Fund for world GDP growth are 3.7% for both 2018 and 2019, including slower growth for the US and China at 2.5% and 6.2%, respectively.

    India’s GDP is expected to grow by 7.4%.

    Cobalt end-uses. Source: Benchmark Mineral Intelligence


    Trade dispute foments uncertainty

    Talks between the US and China are ongoing and have assuaged some investor concern, but until the dispute is concretely resolved the market uncertainty will persist.

    According to Fastmarkets MB Research, China is planning new incentives to boost domestic consumption for goods associated with metal demand including auto and home appliances.

    Along with any further economic stimulus, the measures could spark a brief recovery in metals prices but would need an established trade deal to sustain upwards price pressure.

    Scotiabank analysts reported in mid-October that the global trade dispute was not only the primary driver of the base metals slump but that also it would continue to have an affect up to 2020 and potentially beyond.

    Scotiabank said: “US-China trade concerns remain front-and-centre for commodity markets with no obvious end in sight.

    “We now believe that the US-China trade dispute will remain a slow-burn drag on industrial commodity sentiment through to the 2020 US presidential election.”

    The Scotiabank analysts pointed out that prices were down despite falls in base metal stockpiles, with nickel inventories at five-year lows and copper down 50% over the last six months.

    Cobalt driven by Chinese consumption

    With demand sustained from downstream manufacturing sectors producing smartphones and electric vehicles, and supply primarily constrained to the volatile DRC, cobalt prices are likely to remain strong in future.

    China imports 99.3% of the DRC's cobalt exports, making it the world's largest cobalt importer at 38% of global imports.

    In order to secure stable supply, Chinese state-owned enterprises are increasingly investing in cobalt production in the DRC, with Bloomberg noting eight of the fourteen cobalt mines in the DRC are Chinese-owned.

    The largest example is China Molybdenum which is now the world's second largest cobalt producer behind Glencore.

    Limited corporate social responsibility and a lack of awareness of local supply chains have given Chinese enterprises an advantage in securing products for its cobalt refining and chemical industry.

    Cobalt producers will need to produce more than 200,000 tonnes of cobalt in battery-grade chemicals a year by 2028, according to Benchmark, pushing total demand to 250,000-300,000 tonnes including consumption in other products.

    Global cobalt resources by jurisdiction. Source: United States Geological Survey


    Defining new cobalt jurisdictions

    While the DRC is expected to remain the world’s primary supplier of cobalt in the foreseeable future, the issues plaguing the mining industry in the central African country have prompted a spike in exploration for cobalt in other jurisdictions.

    A number of Australian cobalt and battery metal developers are advancing work on projects both at home and abroad, aiming to define and extract economic cobalt resources.

    READ: Artemis Resources recommences drilling at Carlow Castle, resource update pending

    Artemis Resources Ltd (ASX:ARV) recently resumed aircore drilling at its 100%-owned Carlow Castle Gold-Copper-Cobalt Project in Western Australia’s Pilbara region.

    Results from the program will be combined with other exploration data to design a resource development drill program scheduled for the March quarter 2019.

    A JORC resource update is underway using the near-24,000 metres of previous drill data and is expected this year.

    Initial metallurgical results indicate that Carlow Castle ore is amenable to low-cost gravity gold recovery and base metal flotation processes.

    READ: Australian Mines’ BFS values Sconi Cobalt-Nickel-Scandium Project at $697 million

    Australian Mines Limited (ASX:AUZ) released a definitive feasibility study (DFS) last year for its Sconi Cobalt-Nickel-Scandium in Queensland, valuing the project at $697 million.

    The DFS estimates life-of-mine revenues of about $513 million a year, with average EBITDA at $295 million per year.

    The company signed a binding term sheet with SK Innovation last year for the sale of all cobalt and nickel sulphate to be produced at Sconi and is also progressing financing discussions.

    Historical mining in the area has produced 15,000 tonnes of cobalt and 327,000 tonnes of nickel.

    READ: Blackstone Minerals raises $1.2 million for further exploration in Canada and Western Australia

    Blackstone Minerals Ltd (ASX:BSX) is developing its landholding around the Little Gem project in Canada, which is rapidly emerging into British Columbia’s premier cobalt belt.

    Last year Blackstone identified multiple new large-scale targets at the Jewel copper-gold-cobalt prospect within Little Gem.

    The Jewel prospect is 1.1 kilometres northeast of the Little Gem prospect and is associated with the high-grade Jewel Underground Mine with historical production of 51 tonnes between 1938 and 1940.

    Historical average mining grades of 73 g/t and 0.4% copper have been supported by Blackstone rock chip samples assaying up to 98 g/t gold, 3.2% copper and 0.1% cobalt.


    READ: Cape Lambert Resources highlights value in tailings pipeline

    Cape Lambert Resources Limited (ASX:CFE) is focused on its Kipushi Cobalt-Copper Tailings Project in the DRC, from which it aims to recover cobalt from old tailings left behind in the hunt for copper.

    The company has ambitions to produce thousands of tonnes of material a year near the town of Kipushi in the DRC’s Katanga Copper Belt.

    The tailings dam extends for a kilometre, is more than 400 metres wide and up to 15 metres deep, and has enough material to last as long as five years.

    Cape Lambert executive chairman Tony Sage said the company expected to produce about 2,900 tonnes of cobalt and 7,500 tonnes of copper a year, worth about US$200 million.

    READ: Cobalt Blue’s Thackaringa drilling returns broad, high-grade cobalt results

    Cobalt Blue Holdings Ltd (ASX:COB) is developing the Thackaringa Cobalt Project in western NSW with joint venture partner Broken Hill Prospecting Ltd (ASX:BPL).

    Drilling at the Pyrite Hill deposit late last year reinforced the project’s potential for resource growth and a substantial mine life.

    Pyrite Hill represents 36% of the existing 72 million tonne mineral resource and about 36% of the contained cobalt inventory of 61,500 tonnes.

    Results from the first seven infill holes have confirmed substantial thicknesses of cobalt mineralisation consistent with the existing geological model.

    They include: 68 metres at 1,128 ppm cobalt, 13.4% iron and 13.4% sulphur from 116 metres; and 52 metres at 1,042 ppm cobalt, 11.1% iron and 11.2% sulphur from 93 metres.

    READ: Corazon Mining to advance knowledge of Mt Gilmore, Cobalt Ridge this quarter

    Corazon Mining Ltd (ASX:CZN) aims to define a large deposit at the Cobalt Ridge prospect within its Mt Gilmore Cobalt-Copper-Gold project in northeast NSW.

    The company is also developing the Lynn Lake Nickel-Copper-Cobalt Sulphide Project in Canada.

    Drilling at Cobalt Ridge included 5 metres at 2.14% cobalt within a broader intersection of 27 metres at 0.47% cobalt from 49 metres.

    Results from a geochemical soil sampling program which ended in November indicated cobalt and copper values of up to 450 ppm and 1,060 ppm, respectively, and rock chip samples have graded up to 1,795 ppm cobalt and 16.3% copper.


    READ: Fe Limited advances copper-cobalt in DRC and is leveraged to highly prospective ground in WA

    Fe Limited (ASX:FEL) is advancing its Kasombo Cobalt-Copper Project in the DRC towards production in the first quarter of 2020.

    Kasombo is 25 kilometres from the DRC’s second largest city, Lubumbashi, in the Katanga Copper Belt.

    Recent trenching returned elevated cobalt results including: 10 metres at 0.21% cobalt from 42 metres; and 12 metres at 0.23% cobalt from 17 metres.

    FEL executive chairman Tony Sage said Kasombo could be a very viable copper-cobalt mine, but needed a little bit more work on the ground.

    READ: Great Boulder Resources prepares for deeper drilling of nickel-rich Eastern Mafic target

    Great Boulder Resources Ltd (ASX:GBR) is continuing to drill test targets at its Eastern Mafic nickel-copper-cobalt deposit within the Yamarna project in Western Australia.

    A revised geological model based on geophysics and drilling completed in the Decemvber quarter infers that the Eastern Mafic intrusion was formed at depth and deep drilling will test this theory.

    The company believes that drilling to date, which has returned encouraging copper, nickel and cobalt results, has only intersected the top of the intrusion, leaving the main body untested.

    READ: Havilah Resources’ native title agreement paves way for mining lease at copper-cobalt-gold project

    Havilah Resources Ltd (ASX:HAV) is progressing development of its Kalkaroo Copper-Cobalt-Gold Project in South Australia as well as its nearby Mutooroo Copper-Cobalt Project.

    The company is aiming to find additional resources at Mutooroo to complement the maiden 100 million tonne resource at Kalkaroo, which contains 23,000 tonnes of cobalt.  

    Havilah technical director Chris Giles said a 2018 achievement at Mutooroo was to confirm the cobalt potential of deeper ground at the project, with economic levels of cobalt, copper and gold found.

    Mutooroo’s deposit contains 195,000 tonnes of copper and 8,400 tonnes of cobalt.


    READ: Meteoric Resources begins diamond drilling program at Joyce in Canada

    Meteoric Resources NL (ASX:MEI) has recently begun drilling at its Joyce Copper-Cobalt-Gold Project in western Ontario, Canada.

    Joyce is Meteoric’s highest priority target based on thick sequences of undrilled massive and disseminated sulphides exposed at surface.

    Historical high-grade assays from Joynce include 11% copper, 0.3% cobalt and 8.07 g/t gold, confirming the potential of the system.

    The mineral explorer also identified 18 cobalt targets from an airborne electromagnetic (EM) survey at its Mulligan East and Iron Mask projects last year.

    READ: Marquee Resources prepares Werner Lake resource update, metallurgical sample

    Marquee Resources Ltd (ASX:MQR) expects to update the mineral resource estimate for its high-grade Werner Lake Cobalt Project in Canada this quarter after earning into a 30% stake last year.

    Drilling at Werner Lake has returned strong results such as 2.6 metres at 0.313% cobalt and 0.177% copper from 316.4 metres, including 1.6 metres at 0.406% cobalt and 0.176% copper.

    Werner Lake features cobalt sulphide mineralisation and was discovered in the 1920s and mined in the 1940s.

    Marquee’s other projects include the Skelton Lake Cobalt Project, also in Ontario, and the Clayton Valley Lithium Project in the US state of Nevada.


    READ: Panoramic Resources on track for first shipment from recommissioned nickel-copper-cobalt project

    Panoramic Resources Ltd (ASX:PAN) is aiming to recommission its Savannah Nickel-Copper-Cobalt Project in WA with the first concentrate shipment scheduled early next month.

    The ramp-up to full underground mining production continues for the project in the Kimberley region while the process plant achieved a daily throughput rate of 2,000 tonnes early this month.

    The company also holds platinum group metals and gold assets and its goal is to become a major diversified mining company.

    READ: White Cliff Minerals’ new assays feature 40 metres at 0.22% cobalt and 1.75% nickel

    White Cliff Minerals Ltd (ASX:WCN) is developing its Coronation Dam Cobalt Project in Western Australia, recently completing a 5,000-metre reverse circulation drilling program.

    Highlighted drill results include: 40 metres at 0.22% cobalt and 1.75% nickel from 8 metres; and 36 metres at 0.1% cobalt and 0.88% nickel from surface.

    The drilling has increased the extent of high-grade mineralisation to more than 600 metres long, 400 metres wide and with an average thickness of 20 metres.

    Coronation Dam is 90 kilometres south of Glencore’s Murrin Murrin mining operation and 45 kilometres south of GME Resources Ltd’s (ASX:GME) proposed nickel-cobalt processing facility.

    Thu, 17 Jan 2019 16:31:00 +0000
    Shefa Yamim hails several milestones in update for second half Shefa Yamim (ATM) Ltd (LON:SEFA) has highlighted several key milestones achieved by the firm in the second half of 2018.

    In a corporate update, the Israel-based precious stones exploration firm said a technical economic evaluation (TEE) had been completed for its Kishon Mid-Reach project, will the results to be announced in January.

    WATCH: Shefa Yamim's Carmeltazite officially recognised as new and rare mineral

    The group also said final results from exploration activity at the site had shown total volumes of mineralised placer gravels for the three target exploration zones had increased from around 1.1mln tonnes to 5mln tonnes, with “good progress” being made on planning and regulatory procedures to advance the Kishon Mid Reach Zone 1 area in accordance with the prospecting license.

    The production of a unique jewellery collection from Israeli jewellery designer Yossi Harari, which uses gems found by the company, was also in the final stages of production and was expected to be launched in January.

    Shefa added that it had also received international recognition for a new mineral in nature, Carmeltazite, which was discovered by the company and found in its gemstone, the Carmel Sapphire.

    The firm said that it was not expected to generate revenues at this stage of its development and frequently needs to raise further capital as well as support from creditors from time to time to delay payments as it progressed toward the commencement of mining, adding that it was confident it had sufficient funds to continue exploration operations until the end of the first quarter of 2019.

    By the middle of the first quarter and after the publication of the TEE report, Shefa said it will be able to accurately quantify its funding requirement in order to progress toward trial mining and the Kishon Mid Reach Zone 1.

    As a result, the group said it would need to seek more funding to complete milestones ahead of trial mining and general working capital.

    The group would also continue to expand its exploration efforts in Zone 2 and 3 of the project, as well as at the primary source in the Carmel mountain range to increase its understanding of the scale and scope of deposits in the permit areas.

    In later-afternoon Thursday, Shefa Yamim shares were at 60p.

    Thu, 17 Jan 2019 16:16:00 +0000
    Medlab Clinical eyes cost savings following receipt of SME status in Europe Medlab Clinical Ltd’s (ASX:MDC) European subsidiary has received formal SME (small or medium-sized enterprise) qualification from European Medicines Agency (EMA).

    EMA is the European equivalent to the Australian TGA and the US FDA. As part of the registration, this allows MDC to apply for scientific advice, drug evaluation and registration of NanaBis.

    It also provides MDC with the opportunity to obtain fee reductions up to 90% in the process.

    NanaBi is a cannabis-based medicine which contains formulations of tetrahydrocannabinol (THC) and cannabidiol (CBD).


    Medlab chief executive officer Dr Sean Hall said: “This is a significant milestone for MDC. Drug registration of NanaBi is key part of the company’s plans and this qualification allows us to start the process into Europe.

    “Drug evaluation and registration fees with the various agencies are expensive, but at the same time, a much needed and real cost in bringing a drug to market and we welcome the opportunity obtain fee reductions and as a result significant savings.

    “Personally, I would like to thank EMA for their collaborative approach in this regard, and very much look forward to escalating the NanaBis evaluation with EMA as we move closer to an approved drug in the EU.”

    READ: Medlab Clinical proceeding to stage 2 for cannabis cancer trial

    In late October 2018, Medlab successfully completed stage 1 of the NanaBis human trial on cancer patients at Royal North Shore Hospital.

    The trial is progressing as planned and currently in stage II of the ethics approved trial.

    READ: Medlab Clinical receives preliminary results from NanoStat™ trial

    Thu, 17 Jan 2019 16:09:00 +0000
    Nektan PLC's 'fantastic technology' key to future says new CEO Lucy Buckley, Nektan PLC ‘s (LON:NKTN) new chief executive, tells Proactive it was the gaming company’s fantastic technology that attracted her to the job.

    The emerging B2B business especially has huge opportunities in Asia, Europe and the US, she adds.

    As an indication of the potential, revenues in the second quarter jumped 83% year-on-year while Europe is set this year to be the first region to post an underlying profit.

    “We want Nektan to be a home for big brand, flagship content but `like a Netflix for gaming also to champion the smaller undiscovered content that will be the next big thing.

    “Trading is going well, we have lots of new partners and it is a really exciting time for the business.”

    Thu, 17 Jan 2019 16:03:00 +0000
    Portmeirion expects to report record revenue for 2018, sees profits ahead of market forecasts Portmeirion Group PLC (LON:PMP) saw its shares jump higher on Thursday after the high-quality homewares manufacturer said it expects to report record revenue for 2018 and sees profits ahead of market forecasts.

    In a trading update for the year ended 31 December, the AIM-listed company said it expects its revenue to grow by 5.2% to at least £89.2mln, driven by "strong" growth across its key markets including the UK, US and South Korea.

    READ: Portmeirion shares gain as first-half profits jump by almost a third after strong trading performance

    The company – which owns the Portmeirion, Spode, Royal Worcester, Pimpernel and Wax Lyrical brand - said, at constant dollar exchange rates, its total group revenue increase for 2018 would have been nearer to 6.8%.

    The firm noted that its home fragrance business, acquired in 2016, continued to thrive, with a growth of more than 11% year-on-year in 2018

    In addition, the company said, its ongoing focus on online sales yielded 20% year-on-year growth.

    Dick Steele, Portmeirion’s non-executive chairman, commented: "We are delighted to complete our tenth consecutive year of record sales.”

    He added: “We will continue to invest in growing our business and look forward with confidence to 2019."

    The firm expects to announce its preliminary results for the year ended 31 December 2018 on Thursday 21 March 2019.

    In late afternoon trading, Portmeirion shares were 7% higher at 1,070p.

    Thu, 17 Jan 2019 15:20:00 +0000
    Everyman Media secures new £30mln loan to help further expansion plans, says trading continues to be in line Everyman Media Group PLC (LON:EMAN) saw its shares rise modestly on Thursday after the cinema group announced a new £30mln loan to help further expansion plans as it revealed that trading continues to be in line with market expectations.

    In an update for the 53 weeks to 3 January 2019, the AIM-listed firm said it has agreed a new, five-year loan facility with Barclays Bank and Santander which replaces the previous £20mln facility signed back in March 2017 with Barclays.

    READ: Trendy cinema chain Everyman reports surge in first-half ticket sales

    Everyman Media also said that it continues to source "exciting opportunities" for future investment, and it is confident of being able to grow its existing pipeline beyond the new sites that are expected to go live next year.

    The company currently operates 26 venues, with four new venues opened in the final quarter of the financial year in Altrincham, Crystal Palace, Glasgow and Liverpool.

    Together with York, which was opened in the first half of the year, this brings the total number of venues opened in 2018 to five, the group said.

    It added that, since its interim results in September, lease agreements have been signed for four venues in Manchester, Clitheroe, Northallerton and Plymouth.

    Including these, the group said, it now has commitments in place to open a further 14 venues by 2022, with seven openings expected in 2019, consisting of Horsham, Newcastle, Clitheroe, Manchester, London Broadgate, Cardiff, and Wokingham.

    Everyman Media concluded: “The directors maintain a positive outlook for the cinema industry and for the company in 2019.”

    In late afternoon trading, shares in Everyman Media were 0.5% higher at 205p.

    Thu, 17 Jan 2019 14:57:00 +0000
    Iofina Plc sets record-breaking year in 2018 Tom Becker, chief executive of Iofina plc (LON:IOF), tells Proactive London's Andrew Scott they enjoyed a strong second half to what was a record-breaking year in 2018 in terms of crystalline iodine production.

    The group produced 324.7 tonnes of crystalline iodine in the second half of last year, up 21% from 267.5 tonnes in the corresponding period of 2017.

    Thu, 17 Jan 2019 14:52:00 +0000
    easyJet, British Airways and Ryanair face demand uncertainty in 2019 as Brexit looms, says Barclays easyJet PLC (LON:EZY) shares flew lower as Barclays downgraded its stance on the airline, citing a number of challenges facing the company and the rest of the sector in 2019.

    In a note on European airlines, the bank said 2019 looks to be the “height of aviation demand uncertainty in recent years” as the UK prepares to leave the European Union in March.

    READ: British Airways owner IAG, Ryanair and easyJet shares descend as Deutsche Bank points to risks facing airlines

    “With various industrial and consumer-related indicators raising fears around the cycle and when we also take into consideration possible demand-related risk to traffic from political events such as Brexit, we think it reasonable to be cautious around the demand outlook for 2019,” Barclays said.

    Weaker demand could put negative pressure on fares as airlines cut prices to entice customers, the bank said.

    There are also concerns about tough competition in the short-haul flight sector and higher fuel costs following a rebound in oil prices.

    easyJet lacks growth momentum, says Barclays

    Barclays lowered its rating on easyJet to ‘underweight’ from ‘equal weight’ and cut its target price to 1,200p from 1,500p.

    The bank said it thinks the growth profile for easyJet “lacks some momentum in our view, not helped by difficult comparables and possible UK demand related risk”.

    “With a network that is focused on primary constrained airports, organic growth opportunities are limited, and the incremental revenue associated with these premium slots is currently being offset with incremental costs given the level of delays and disruptions associated with operating with constrained infrastructure,” Barclays said.

    “The new initiative to tackle operational resilience is necessary in our view, and whilst they should help to offset further disruption in the future, they will likely come with some incremental capital expenditure and operational expenditure as the investment in resilience is made.”

    READ: easyJet profits soar as it benefits from rivals' woes but shares fall on concerns about costs

    Barclays said easyJet’s acquisition of collapsed Air Berlin assets at the Tegel airport show integration comes with challenges and takes time. The Tegel operations made a loss before tax of £152mln in 2018.

    “Meanwhile, the plans for easyJet Holidays, business, loyalty and data are interesting, but again should result in near-term incremental operating expenditure with unclear quantum and timing of revenue upside,” Barclays said.

    For the 2019 financial year, Barclays expects easyJet to post pre-tax profit of £543mln, compared to the £578mln reported last year.  

    “Although the fall in the fuel price, combined with the group’s hedging profile, means that there is little unit cost headwind for easyJet in FY19, the comparable revenue base is particularly challenging with c£80mn in one-offs,” the bank said.

    “Although most of this will unwind in H1, we expect a partial effect in Q3, whilst summer capacity growth is still unknown, the demand environment is uncertain and given falling fuel costs potentially being competed away.”

    Shares in easyJet dropped 1.8% to 1,171p in afternoon trading. 

    IAG remains 'best in class'

    Elsewhere, Barclays said it continues to hold the view that British Airways owner International Consolidated Airlines Group PLC (LON:IAG) offers fundamental value and is the “best in class airline operator”.

    Barclays maintained an ‘overweight’ rating on the stock but cut its target price to 700p from 780p, noting that in the short term, the group faces some uncertainties and less momentum than was seen in 2018.

    READ: British Airways parent IAG sees annual profits €200mln up on last year

    “The airline industry as a whole faces the most uncertain demand environment for some time, and as a largely UK business that reports in sterling, IAG faces additional risk related to Brexit from both currency translation and demand-related risks,” the bank said.

    “Additionally, we note that 2019 is likely to be a slightly softer year for unit cost reduction delivery given planned BA opex investment, and rising capex for the fleet delivery plan.”

    The bank expects IAG to report broadly flat profits in 2019, marking the softest momentum seen in recent years. However, it sees IAG achieving a 12% margin and a 15% return on invested capital, which is well above peers.

    IAG shares rose 1.02% to 616p. 

    Ryanair the 'structural winner'

    Barclays also kept an ‘overweight’ rating on Ryanair Holdings PLC (LON:RYA) but lowered its target price to €12.70 from €15.80.

    “Although Ryanair’s cost base has been the major focus for investors over recent months, we hold the view that despite some labour cost inflation and productivity softening, Ryanair’s unit cost base will still remain best-in-class,” it said.

    “We believe that management will continue to use the cost base advantage to drive the revenue growth story, with market share and network shift opportunities remaining.

    “We continue to believe that Ryanair will be the structural ‘winner’ in a European market that is growing and consolidating.”

    In 2020, Barclays expects Ryanair to post €1.17bn in net income, up 6% on the previous year, but it faces “amongst the easiest comparables in the sector due to the largely self-inflicted challenges in FY18 and FY19”.

    READ: Ryanair profit slumps as strikes and fuel price hit

    Ryanair was hit by a series of worker strikes last year after acknowledging unions for the first time, leading to a mountain of flight cancellations. 

    Shares increased by 0.8% to €10.13.

    Thu, 17 Jan 2019 14:49:00 +0000
    RM Secured Direct Lending delivers 'strong' Q4 given wider challenging market RM Secured Direct Lending PLC's (LON:RMDL) Pietro Nicholls tells Proactive London's Andrew Scott the portfolio performed well in the fourth quarter of 2018 given the wider market conditions and he's expecting prices to recover as the market stabilises.

    He adds that they completed nine transactions in the quarter including two investments into childcare services and nursery businesses,  two asset financing transactions as well as a hotel financing.

    Thu, 17 Jan 2019 14:45:00 +0000
    Nemaura says improved continuous glucose monitor halves time needed for reliable reading Nemaura Medical Inc (NASDAQ:NMRD) said Thursday that the company has improved its SugarBEAT continuous glucose monitor to halve the time needed for a reliable reading for diabetic and prediabetic patients.

    The  Loughborough, England-based medical technology company said in a press release that the time it takes for a reliable reporting of glucose levels from its skin-patch system can be reduced to 30 minutes from about an hour previously.

    BIG PICTURE: Nemaura is a red hot medtech stock with a winner in its painless sugarBEAT glucose monitor

    According to Nemaura, a major competitor’s continuous glucose monitor requires a two-hour “warm-up period” and is designed to be worn continuously for 10 days.

    Nemaura said its advance provides flexibility for users who wish to wear the skin patch for a few hours daily.

    “The flexibility of SugarBEAT will be a key differentiating factor with the potential to reach the largest number of diabetics and provides Nemaura with the opportunity to expand into new markets,” Dr Faz Chowdhury, CEO of Nemaura, said in a statement.

    Diabetic population

    Globally, there are more than 400 million diabetics and 1 billion prediabetics, according to Nemaura, citing PiperJaffray Co data. The annual addressable market for continuous glucose monitors for diabetics is estimated at $82 billion, with the US market estimated at $13 billion.

    Shares of Nemaura slipped $0.03 to $1.04 in Thursday’s Nasdaq trading.

    Last month, Nemaura announced the closing of a public offering that raised $2 million.

    Contact Dennis Fitzgerald at

    Thu, 17 Jan 2019 14:34:00 +0000
    EQTEC Plc's Ian Price hails significant new contract with Phoenix Energy Ian Price, chief executive of EQTEC Plc (LON:EQT), discusses with Proactive London's Andrew Scott what's been described as a “landmark deal” with Phoenix Energy - signing a first equipment purchase contract in relation to the US company's first power plant in California.

    Phoenix will be the first customer in the US to utilise EQTEC's gasification-to-energy technology and price reckons it will lead to further opportunities throughout the US market.

    Thu, 17 Jan 2019 14:24:00 +0000
    Origo Partners sells remaining interest in Niutech Energy for around US$2.1mln Origo Partners PLC (LON:OPP) saw its shares jump early on Thursday following news the private equity investment group has sold its remaining interest in Niutech Energy, although the stock had surrendered those gains by the afternoon.

    The company, which is focused on China-linked core economic growth opportunities, has flogged its stake for around US$2.1mln, which was at a discount of 20% to book value, partly reflecting the decline of the Chinese currency against the US dollar

    READ: Origo Partners to raise US$30m to fund investments in China and Mongolia

    Origo shares rose 45% to 0.4p in an initial reaction to the news, but by late afternoon trading they were flat at 0.25p.

    The company said it has already received 90% of the proceeds from the sale and will use the money for general corporate purposes.

    Niutech has a technology that essentially produces energy from scrapped tyres and waste plastic.

    The sale follows just under a year after the company announced the indirect sale of a 4.7% beneficial interest in Jinan Heng Yu Environmental Protection Technology, the operating company of Niutech Energy, to Chinese institutional and other investors, for net cash proceeds of RMB 18.8mln (roughly US$3.0mln).

    In its interim results, announced in late September, Origo said its stake in Niutech at the end of June stood at 3.67%.


    Thu, 17 Jan 2019 14:09:00 +0000
    Winkworth outperforms with 2018 profits expected to be ahead of expectations Dominic Agace, chief executive of estate agent M Winkworth Plc (LON:WINK), spoke to Proactive London following the release of its 2018 trading update.

    Total revenues rose on the year before and is expected to be within 5% of market expectations while profits are expected to be slightly ahead of expectations of £1.4m.

    ''We've got a fantastically defensive model - we'll continue to trade well and progress despite it being a low transaction market with a significant potential for upside as transactions increase ... and a chance in this period to grow our footprint so we benefit to a greater extent when those transactions drop through the business''.

    Thu, 17 Jan 2019 13:36:00 +0000
    RM Secured Direct maintains defensive stance as world economy slows Specialist debt trust RM Secured Lending PLC (LON:RMDL) is shifting its investment stance more towards non-cyclical sectors as it believes the world economy is slowing.

    “Looking ahead into Q1 2019, the investment manager expects volatility to remain elevated and with investors focusing their attention on the macro-economic data, credit and equity markets will remain generally weak.

    READ: RM Secured Direct Lending says all cash available for investment deployed during month of December

    “Poor industrial production figures across Europe, released in January 2019, reinforced the widely held view that the global economy is slowing.

    "Late-stage lending can be advantageous for the company as lending rates can rise, however, caution is warranted as these areas can still be affected by asset price declines."

    Net asset value or NAV at the end of December was 96.98p or 1.22p lower than the end of November.

    During the quarter there was one significant repayment (Exterion Media) one refinancing (Children’s Nurseries) and new investments in property bridging (3); receivables financing; Praetura Asset Finance and in a hostel property in Glasgow.

    Shares are trading at 101.5p.

    Thu, 17 Jan 2019 13:16:00 +0000
    Patisserie Valerie owner loses deputy chairman after discovering accounting black hole Another top director has resigned from Patisserie Holdings PLC (LON:CAKE) in the wake of discovering a £40m gap in its accounts.

    Deputy chairman Lee Ginsberg has stepped down from the owner of the Patisserie Valerie cake chain with immediate effect in order to “focus on his other commitments”.

    READ: Patisserie Valerie owner appoints interim CFO after suspended CFO quits amid accounting scandal

    The news comes a day after the company said forensic accountants have uncovered “thousands of false entries into the company’s ledgers”.

    The accountants found “the misstatement of its accounts was extensive, involving very significant manipulation of the balance sheet and profit and loss accounts”.

    Patisserie said it was clear the cash flow and profitability of the business had been overstated in the past.

    The accounting black hole first emerged in October, forcing chairman Luke Johnson to inject £20mln of his own funds into the firm to keep it afloat.

    CFO and CEO resignations​

    Chief financial officer Chris March was arrested in October on suspicion of fraud by false representation and released on bail. He resigned from the role shortly after being suspended by the firm.

    The company has appointed Nick Perrin, the former finance director of UK veterinary services firm CVS Group PLC (LON:CVSG), as interim chief financial officer while it searches for Marsh’s replacement.

    Chief executive Paul May resigned in November and was succeeded by Stephen Francis, who was chief executive of pork farmer Tulip Ltd.

    Investigations into accounting scandal 

    The Serious Fraud Office has said it is investigating an individual involved in the matter but has not named the person in question.

    The Financial Reporting Council (FRC) is investigating the audits carried out by accountancy firm, Grant Thornton, for 2015, 2016, and 2017, as well as the preparation and approval of company financial statements by Marsh.

    The accountancy regulator said that once the investigation process, which could take up to two years, was complete, it would decide whether to present a case against Grant Thornton and Marsh at a tribunal, which could result in fines or, in the case of individuals, banning them from practising as accountants.

    Patisserie has hired accountants KPMG, which is known for its expertise in restructuring and insolvency, particularly a company voluntary arrangement process that involves agreeing a deal with landlords and lenders to close stores and reduce rents. 

    Shares are currently suspended.

    Thu, 17 Jan 2019 12:21:00 +0000
    ADES International launches integration project for recent acquisitions ADES International Holdings Ltd (LON:ADES) has unveiled a project to integrate its recent acquisitions in a move to improve value delivery.

    The firm, which provides drilling and production services to the oil & gas sector in the Middle East and North Africa, said the project will run through 2019 and respect all existing client commitments, with strong governance installed for guidance and to minimise the impact on daily operations.

    READ: ADES International secures seven-year contract renewal in Saudi Arabia

    The Boston Consulting Group, which the firm said had “deep expertise in integration programs” in the sector, will support the project.

    Dr Mohamed Farouk, chief executive of ADES, said the acquisitions had allowed the firm to “add strong client relationships, assets and teams” to its portfolio, adding that he believed the project could be rolled out with “minimal impact on daily operations”.

    In lunchtime trading Thursday, ADES shares were at 13.2p.

    Thu, 17 Jan 2019 12:04:00 +0000
    Breakfast News - Taptica, Frontier Smart Tech, Serabi Gold and more... Set menu




    Total number of AIM Companies (Incl Susp):




    Total number of AIM Companies trading:




    *as at close of business  15 January 2019


    Standard List**  of Main Market:


    Total number of Standard List Companies


    (Incl Susp):




    Total number of Standard List Companies trading:




    *as at close of business 15 January 2019


    NEX Growth Market:


    Total number of NEX Growth Market Companies (Incl Susp):




    Total number of NEX Growth Market Companies trading:




    *as at close of business 15 January 2019


    *A corporate client of Hybridan LLP


    **  Standard Listing as defined by Hybridan LLP to be a business with strictly operational activity


    Dish of the day


    No Joiners Today


    Off the menu      


    Bioquell has left the main  market (premium)  following a £140.5m takeover by  Ecolab.


    What’s cooking in the IPO kitchen?


    Main Market (Specialist Funds)


    The Global Sustainability Trust -aiming for attractive risk-adjusted returns by investing primarily in private market investments that are expected to have a positive environmental and social impact raising c.£200m. Due 31 Jan 2019.


    Main Market (Standard)


    Dev Clever Hldgs—Raising up to £700k gross.  The Group has invested over £600,000 in the last five years in developing proprietary software platforms and immersive frameworks to reshape the way its clients engage, acquire and retain their customers and employees through experience, rewards and incentives.  Mkt cap c. £3.7m




    Circassia Pharma (LON:CIR) - specialty pharmaceutical company focused on respiratory disease transferring from the Main Market. No funds being raised. Due 4 Feb.


    Greenfields Petroleum (TSX-V:GNF)  production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.


    Banquet Buffet


    Oracle Power (LON:ORCP) 0.53p £5.14m


    The UK energy developer of a combined lignite coal mine and mine mouth power plant located in the Thar desert in the south-eastern Sindh Province of Pakistan, today provides an update on recent operational and macro developments.


    Block VI maintained as Priority Project in 8th Joint Cooperation Committee  meeting;


    China Pakistan Economic Corridor ("CPEC") approve Oracle proposed expansion to 700MW;


    Consortium partnership change noted in CPEC.


    Iofina (LON:IOF) 15p £17.45m


    “The exploration and production of iodine and halogen-based specialty chemical derivatives, updated the market on an exceptional year for the Group, in which it produced record volumes of crystalline iodine and executed on the Group's commitment to growth and increased profitability.”


    H2 2018 324.7 metric tonnes ('MT') a 21% increase YOY (H2 2017: 267.5MT)


    Full year production in 2018 of 588.8MT a YOY increase of 17% (2017: 503MT)


    H1 2019 production currently forecast at 310-330 MT of crystalline iodine.


    Iofina Chemical continues to trade strongly in both iodine and non-iodine products.


    Ten Entertainment  (LON:TEG) 220p £143m


    FYDec18 update from UK based operator of 43 family entertainment centres.


    The Group performed well during the full-year, achieving total sales growth of 7.5%to £76.35m.


    Like-for-like sales growth was 2.7%, which demonstrates the strength of consumer demand, despite the significant impact of unprecedented hot weather during the summer period.


    The Group has made further progress with the expansion of the estate with the acquisition of four sites, which was at the upper end of the acquisitions forecast. All four sites have been extensively refurbished during FY18 and are expected to perform in line with our expectations during FY19.  In addition, one under-performing site was disposed of during the year.


    XL Media (LON:XLM) 71.9p £162.8m


    The “provider of digital performance marketing services, provided an update for the year ended 31 Dec 2018.


    XLMedia confirms that trading in the second half of 2018 continued to strengthen with the Group proactively focusing on higher margin business.  As a result of this overall margin improvement, the Group expects to report EBITDA in line with current market expectations, achieved against lower revenue base of approximately $118m. The Company has a material cash balance and continues to generate strong cash flows from operations. 


    The Company is focused on growing the higher margin publishing division within its key strategic verticals: Gaming (including the newly re-regulated US Gambling market), and Personal Finance. The Company looks forward to providing a more detailed update to the market as part of the full year results announcement.


    Taptica  (LON:TAP) 179.5p £125.1m


    The specialist in advertising technologies for performance-based mobile marketing and brand advertising, reported that it closed the financial year to 31 Dec 2018 in line with management expectations.


    As at 31 Dec 2018, the Company had net cash of $54.4m, which was following a $2.7m dividend paid to shareholders on 20 Nov 2018 (30 June 2018: $42.1m ).


    Further to the announcement made on 3 Jan 2019, the Company can confirm that it remains in discussions with a potential acquisition target. Further announcements will be made in due course and there can be no certainty that any transaction will follow or regarding the terms of any such transaction.


    FYDec18E rev $220m and PBT $22.55m. PE c.5x.


    Frontier Smart Tech (LON:FST) 33.5p £12.22m


    Unaudited trading update for the year ended 31 Dec 2018  from the Pioneer in technologies for Digital Radio and Smart Audio devices


    The Group expects to report a much improved second half and a FY 2018 financial performance broadly in line with current market expectations. Revenue for the financial year is expected to be not less than $41.m and EBITDA is anticipated to be c.$1.4m.


    Frontier's priorities are to:


    Maximise Digital Radio cashflows


    Control R&D expenditure and leverage ecosystem relationships in Smart Audio


    Establish a Licensing business, which exploits the Group's multi-ecosystem software and cloud assets, to address the opportunities in Smart Audio and Smart IoT


    Synairgen (LON:SNG) 16.1p £14.77m


    Pharmaxis has reported receipt of all data for the LOXL2 inhibitor candidates in three-month toxicity studies.  These data complete the overall package required for Pharmaxis' partnering discussions.


    In Nov 2018 Pharmaxis announced the successful completion of the Phase I single and multiple ascending dose trials of their two LOXL2 inhibitor compounds.  Data from the Phase I trials support once daily oral dosing and demonstrated best-in-class inhibition of the LOXL2 enzyme. Together with preclinical data in models of fibrosis, this package shows the potential of these compounds to target diseases associated with LOXL2 such as Non‐alcoholic Steatohepatitis (NASH) and idiopathic pulmonary fibrosis (IPF)


    Arena Events (LON:ARE) 38.2p £88.1m


    The Board expects revenues for the year ended 31 Dec 2018 to be in-line with expectations but as a result of the increased costs in the UK division in the fourth quarter, the Board now expects Adjusted EBITDA for the year ended 31 Dec 2018 to be in the range of £12m to £12.5 m. Notwithstanding, the Group still expects to report approximately 25% growth in Adjusted EPS for 2018 over the prior year. The Group enters 2019 with a number of new contracted projects and a full year contribution from acquisitions which is expected to result in a material increase in earnings for the year to 31 Dec 2019.  However, as a result of the impact of the UK operational issues, wider economic uncertainty and a prudent view on the timing of a number of large potential one off contracts, the Board is taking a more conservative outlook for 2019.


    Serabi Gold (LON:SRB) 37p £19.15m


    The Brazilian focused gold mining and development company, provided the results and a review of its fourth quarter operational and exploration activities in the Tapajos region of Para State, Northern Brazil.  Fourth quarter gold production of 10,256 ounces of gold represents record quarterly production for Serabi. Annual gold production totalling 37,108 ounces is an improvement on 2017 production. Highest level of mined tonnage for 2018 achieved in fourth quarter with a total of 44,257 tonnes at 7.45 g/t of gold.  2,460 metres of horizontal development completed during the quarter, giving a total of 10,371m for the year.


    A series of discrete “apparent conductivity” anomalies have been delineated by the analysis of the airborne magnetic and electromagnetic survey flown during the third quarter of 2018.  These anomalies are indicative of probable sulphide bodies which the Company hopes will be gold bearing.


    Thu, 17 Jan 2019 11:46:00 +0000
    William Hill ripe to be a takeover target after intense 2018 hits shares, says Berenberg William Hill plc (LON:WMH) is on the front foot after Berenberg upgraded the stock, saying it “struggles to justify” the current share price after losing almost 50% of its value in 2018.  

    Berenberg raised its recommendation on the stock to ‘buy’ from ‘hold’ but cut its target price to 250p from 280p.

    READ: Shares in UK bookmakers rocked by potential US ban on online betting

    “2018 was an intense year for William Hill (WMH), with the UK digital business still struggling to gain back market share due to the implementation of new regulatory measures, a monster write-off of the UK retail network, the acquisition of Mr Green and several initiatives undertaken to address the nascent US sportsbetting market,” the broker said.

    Following a sharp fall in the company's market value, Berenberg thinks it is "now ripe to be a takeover target".

    While it sees significant upside potential to its target price, Berenberg still prefers other stocks in the gaming sector as it wants to see William Hill’s UK business return to growth and its US initiatives gather pace.

    GVC Holdings PLC (LON:GVC) remains Berenberg's top pick.

    READ: William Hill picks up 4.7% of shares in Mr Green & Co​

    William Hill plans to expand in the US through sports betting agreements with 11 casinos in Mississippi and a casino partner in West Virginia.

    It has also agreed to buy Swedish online bookmaker Mr Green, in a deal that will give it an EU base after Brexit.

    In the core UK retail business, Berenberg expects a “substantial contraction” in 2019 due to new, lower limits for betting on gaming machines.

    “This will bring retail earnings down to an extent that cannot be compensated for by the Mr Green consolidation in 2019.”

    Berenberg said the pace of the integration of Mr Green must be monitored, along with changes to US regulation.

    The broker’s estimates for 2019-20 are below consensus forecasts as it expects higher start-up losses in the US than other analysts.

    In late morning trading, William Hill shares rose 2.7% to 175.25p.

    Thu, 17 Jan 2019 11:42:00 +0000