Three concerns keep Mark Payton, boss of Mercia Technologies (MERC), up at night: growth stalling among the technology investor's direct holdings; its managed funds failing to generate enough cash to cover investment costs; and staff, whose industry expertise and ties to start-ups and universities help the company find exciting prospects, losing interest and leaving. Shareholders can sleep soundly, as his fears didn't materialise in the reported period. Indeed, £5.7m in further investments and a valuation uplift of £2.8m boosted the fair value of Mercia's investment portfolio by 22 per cent to £46.6m.
Mercia made nine direct investments, expanding its portfolio to 26 companies at the year-end and raising investment to £30m since its listing in December 2014. Its managed funds raised £8.6m and invested £11.5m in 58 companies, strengthening the pipeline of future investment prospects.
Concepta, the women's health diagnostics business, secured an Aim listing. Moreover, Google tasked virtual reality outfit nDreams with creating apps and experiences for the tech giant's new Daydream platform. The two holdings' combined valuation rose by about £5.5m, outweighing management's £2.7m write-down of its largest interest, Science Warehouse, due to a tougher market.
Prior to these results, broker Cenkos expected a net asset value (NAV) of 36.5p at the end of March 2017, down from 37.5p a year earlier.
| MERCIA TECHNOLOGIES (MERC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 49p | MARKET VALUE: | £104m | |
| TOUCH: | 47-50p | 12-MONTH HIGH: | 58p | LOW: 39p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 38p | NET CASH: | £24m | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 0.7 | -0.7 | -0.4 | nil |
| 2016 | 2.9 | 1.1 | 0.5 | nil |
| % change | +341 | - | - | - |
Ex-div:- Payment:- | ||||
