In the first half, Mercia Technologies’ (MERC) managed funds were buoyed by a £34.5m cash realisation from Blue Prism (PRSM) – a specialist in robotic process automation. This represents a multiple of 55 times the initial investment by Mercia’s ‘RisingStars Growth Fund’ in 2004. Bosses explain that Mercia’s third-party managed funds shoulder the initial risks of investing in a range of innovative technology businesses. The group then selects ‘emerging star’ holdings from within the funds, providing these with further capital from its own balance sheet.
A £4.7m net fair value gain within the direct investment portfolio stemmed largely from Oxford Genetics and Warwick Audio. Mercia participated in fundraising rounds for both, investing £2m of a total £7.5m in the former, and £1.9m of £3.1m in the latter. Oxford Genetics develops molecules within the synthetic biology market, while Warwick has created a lightweight electrostatic speaker.
A fall in the share price of Aim-traded Concepta (CPT) dampened net fair value gains. But Mercia still maintains confidence in the company, demonstrated by its £0.37m contribution to Concepta’s recent £2m equity placing. Post-period end, the investment group established a partnership with the University of Edinburgh, marking its sixth Scottish university partnership. And the group invested £1.8m in Aston EyeTech: a new ‘emerging star’, specialising in ocular care technology.
Analysts at Cenkos forecast net assets of £119m or net asset value (NAV) per share of 39.6p for the year to March 2018.
| MERCIA TECHNOLOGIES (MERC) | ||||
| ORD PRICE: | 36p | MARKET VALUE: | £107m | |
| TOUCH: | 34-37p | 12-MONTH HIGH: | 51p | LOW: 30p |
| DIVIDEND YIELD: | nil | PE RATIO: | 85 | |
| NET ASSET VALUE: | 41p | NET CASH: | £30.2m | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 2.9 | 1.1 | 0.53 | nil |
| 2017 | 4.8 | 1.4 | 0.48 | nil |
| % change | +68 | +24 | -9 | nil |
| Ex-div: | na | |||
| Payment: | na | |||
