Allied Minds (ALM) launched a restructuring programme in April this year. Chief executive Jill Smith listed three tenets of the IP investor's strategy. First, installing managers at portfolio companies that are accountable for progress towards commercialisation. Second, bringing strategic investors into investment rounds for portfolio companies. And third, a focus on thematic investing. Progress has been made, but inventory write-offs and personnel-related restructuring costs have been incurred. So, while first-half revenue increased (see table), pre-tax losses worsened. The value of the group’s stakes in its subsidiaries was flat on the year-end at $416m (£322m).
Allied Minds has historically sought to remain a majority investor in its portfolio companies. Bringing in outside investors helps to de-risk an investment on its path to commercialisation. During the period, the group saw the closing of a $6m preferred funding round for BridgeSat, which delivers big data securely using low earth orbit (LEO) satellites with greater speed and cost-effectiveness than radio frequency solutions. An angel investor network, Space Angels, participated. And HawkEye 360 completed the second closing of its $13.8m preferred funding round. This business plans to operate LEO satellite clusters to provide radio mapping, and Ms Smith notes that it already has revenue contracts in place – “very early”, she says, for a young company.
Allied Minds invested $22.4m into its new and existing businesses, while third-party investors provided a relatively small additional $1.6m. Net cash was $49m lower than at the start of the year.
Analysts at Credit Suisse forecast an EPS loss of 39ȼ for the year to December (from a loss of 44ȼ in 2016).
| ALLIED MINDS (ALM) | ||||
| ORD PRICE: | 151p | MARKET VALUE: | £359m | |
| TOUCH: | 149-151p | 12-MONTH HIGH: | 475p | LOW: 130p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 39ȼ | NET CASH: | $177m | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (ȼ) | Dividend per share (ȼ) |
| 2016 | 1.29 | -52.2 | -19 | nil |
| 2017 | 1.98 | -58.2 | -19 | nil |
| % change | +54 | - | - | - |
| Ex-div: | nil | |||
| Payment: | nil |
