Shares in Quadrise Fuels (QFI) were marked down heavily on release of full-year results that showed an operating loss of £4.9m. That's more or less flat on last year's comparative, but the financials are of secondary importance to the current operational trials with Danish shipping giant Maersk - a chief determinant as to whether Quadrise's proprietary emulsion fuel MSAR will achieve commercialisation.
The full-year update suggests that all is progressing to plan and the company has received "positive initial feedback". If the trials continue to run to schedule, management said that an interim progress update would follow in the first quarter of 2017, ahead of final LONO or 'Letter of No Objection' certification by the middle of the year. The receipt of this industry standard would be highly significant for Quadrise, effectively signalling the beginning of MSAR's commercial rollout.
Quadrise exited the period with £4.3m in the bank and no debt on its books. But to provide sufficient funding to get MSAR to market, the company announced a placing at 10p per share by way of an accelerated book-build to raise £4m along with an open offer to generate a further £1m.
As we went to press, analysts at Peel Hunt were factoring the new placing shares and cash inflow into its valuation, but reiterated its 30p target price.
Click here to listen to the IC's recent interview with Quadrise's chief executive Mike Kirk.
| QUADRISE FUELS INTERNATIONAL (QFI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 10.5p | MARKET VALUE: | £85m | |
| TOUCH: | 10.3p-10.5p | 12-MONTHHIGH: | 24p | LOW: 8p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 1p* | NET CASH: | £4.3m | |
| Year to 30 Jun | Turnover (£'000) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 38 | -4.2 | -0.6 | nil |
| 2013 | 75 | -5.0 | -0.6 | nil |
| 2014 | 51 | -6.0 | -0.7 | nil |
| 2015 | 105 | -5.0 | -0.6 | nil |
| 2016 | 2 | -4.9 | -0.6 | nil |
| % change | -98 | -1 | -3 | - |
Ex-div:- Payment:- *Includes intangible assets of £2.9m, or 0.4p a share. | ||||
