Shares in London went into retreat in early trading. Click here for The Trader Nicole Elliott's latest thoughts on the markets.
IC TIP UPDATES:
Hay fever victims currently suffering with the effects of one of the worst pollen seasons for many years will be particularly pleased with this morning’s announcement from Allergy Therapeutics (AGY). The journal Immunotherapy has reported further positive results from the group’s Pollinex Quattro long acting injection for grass allergy sufferers. The findings support earlier studies into the new therapy and will give the group confidence as it approaches the all important phase three clinical trial into the efficacy of the drug, which is expected to begin in Autumn 2019. Buy
Shares in Countrywide (CWD) fell by over 20 per cent after the beleaguered estate agent warned that cash profits in the first half will be down £20m on the previous first half, and that there is unlikely to be any improvement in the second half. It also announced plans to reduce debt through an equity placing. Sell
Stobart Group (STOB) will hold an extraordinary general meeting on 18 July to vote on the re-election of Iain Ferguson as non-executive director. A circular has been sent to shareholders with details about why the board believes Mr Ferguson is the best fit for the role. Stobart group’s former chief executive Andrew Tinkler was fired from his role as a director earlier this month after he wrote to shareholders encouraging them to vote against Mr Ferguson’s re-election. Despite this infighting at board level, we think the underlying business still looks sound. Buy.
Shares in Marlowe (MRL) are up 3 per cent this morning following release of full year results. The group’s acquisition-focused approach has been paying off, boosting sales and profits by more than 70 per cent apiece on an adjusted basis. One of the MRL’s acquisitions was ductwork specialist Ductclean, marking the group’s move into a new sector. Buy.
Filtration specialist Porvair (PRV) revealed a 7 per cent increase in half-year revenue to £59.7m – a 12 per cent rise on a constant currency basis – together with an 8 per cent increase in adjusted earnings. It’s was a period of expansion with deals to acquire Rohasys BV and Keystone Filter, though organic growth rates benefitted from “incremental new product introductions” and the introduction of intellectual property to the product portfolio. Another solid return. Buy
KEY STORIES:
Polar Capital (POLR) gained £1.9bn in net inflows during the year to March, which along with £800m in market gains, took assets under management up a more than a quarter to £12bn. Net management fees were up a third, but performance fee profit jumped to £15.3m, from just £1.2m the prior year.
Troubled gold miner Acacia Mining (ACA) remains a side-party to discussions over its fate. That’s the conclusion from an update this morning, in which the gold miner said discussions between majority shareholder Barrick and the Tanzanian government were “constructive” and that some progress had been made since a proposed framework was signed in October. But no timetable has been drawn for the completion of Barrick’s discussions, so as to avoid “an arbitrary deadline”. Shares are down 5 per cent this morning.
IWG (IWG) has confirmed a possible cash offer from Terra Firma Investments, adding to the offers it has already received from Starwood and TDR. The UK-based private quity group has until July 21 to make a firm offer for the group. Hold.
OTHER COMPANY NEWS:
Mind Gym has announced its proposed admission to Aim and the placing of 34.8m shares at 146p with institutional investors. Its market cap should reach around £145m on admission – due Thursday 28 June, under the ticker ‘MIND’. The placing will generate £50.8m for selling shareholders. Mind Gym provides behavioural science-based training to improve how employees work in large organisations across multiple sectors. It reported revenues of £37m and adjusted cash profits of £7.9m for the year to March 2018. The chief executive, chair and co-founder/ executive director will collectively retain around 64.6 per cent of the total share capital.
EVR Holdings’ (EVRH) flagship product MelodyVR will launch tomorrow morning across an additional eight European countries. The app, which offers virtual reality music content, first launched in the UK and the US in May. It will now launch in France, Germany, Sweden, the Netherlands, Switzerland, Greece, Austria and Belgium alongside Facebook’s (US: FB) ‘Oculus Go’ hardware device which costs $199. EVR also noted that it is now revenue generative, and early statistics on MelodyVR’s user engagement are positive. The shares were up 7 per cent in morning trading.
