Member Info for EquityDevelopmen

New research report (free & accessible): https://www.equitydevelopment.co.uk/research/well-placed-to-weather-even-the-harshest-of-storms

Gattaca reported in line H1’23 results (6M ending Jan’23). Underlying NFI climbed +5.2% to £22.7m (£21.6m LY) thanks to two new client wins and strategic price initiatives (+9% contract & 6% perm).

On top, there were standout performances (see note) from defence (+32%), energy (20%) and infrastructure (7%) - partly offset by the shedding of low margin business (2 large accounts) and a not surprisingly less buoyant TMT backdrop (-43.5%, tough YoY comps). We believe the group remains on track to achieve both its ongoing turnaround and longer-term targets, after raising fee earner productivity (+14% revs/head), employee engagement and EBIT/NFI margins to +4.2% (-0.5% LY). This has delivered an H1’23 adjusted PBT and diluted EPS of £0.9m (-£0.3m LY) & 2.0p (-0.8p) respectively.

Despite the economic conditions, we’ve held our conservative FY’23 and FY’24 PBT forecasts at £1.8m (£256k LY) and £4.25m respectively on NFI up 5.3% (£46.5m) and 8.9% (£50.6m), along with reiterating the valuation of 130p/share.

19% revenue growth, a 12% increase in membership numbers and a £1.0m favourable swing in adjusted EBITDA were key features of today’s FY2022 results statement from The Artisanal Spirits Company. With the Masterton Bond facility fully operational and group trading having started well in the current year, ASC appears well placed to deliver medium term sustainable profitable growth. As a membership organization which boasts substantial invested facilities and valuable whisky stocks, we reiterate our 150p fair value for the shares.

This implies a 4.9x FY2023 EV/sales ratio, largely on a relative valuation when compared with leading listed distilled spirits companies and luxury goods providers. ASC is simultaneously exposed to both these categories given its emphasis on ultra-premium-and-above Scotch malt whiskies. Furthermore, the £493m updated notional retail value of the company’s maturing whisky stocks (mentioned above) is currently over 7 times today’s market capitalisation.

https://www.equitydevelopment.co.uk/research/delivering-robust-profitable-growth

With FY22 now firmly in the rear-view mirror, Strix Group plc is looking forward with more optimism. China is re-opening for business following several COVID-related lockdowns and green shoots have begun to appear. Sales to OEMs have seen a substantial improvement in run-rates during the first two months of FY23 and, while a swallow does not make a summer, we see positive signs, not least the possibility that a recession may well be averted in Western economies. A combination of product launches, the acquisition of the high margin Billi and a cross fertilisation of sales between the consumer brands augurs well for FY23.

We expect FY23 to represent an inflection point for the Kettle Controls business. In the YTD, green shoots have appeared, with sales to OEMs rising 18% versus Q4 (which represented a low point in FY22). As COVID-related restrictions have been lifted in China, we expect revenues to improve further as bottlenecks are removed and trading returns to normal patterns. A combination of product launches within Water/Appliances/Billi, new listings (online and retail), and a cross-fertilisation of sales within the wider consumer areas is expected to result in strong growth in revenues and profitability.

Our comparative valuation models suggest that Strix Group is trading on the lowest FY1 EV/EBITDA and PER multiples within its peer group. Our fair value estimate of 216p/share is backed by a conservative DCF model and represents a significant uplift on the current share price. Even following the dividend cut, the FY1 yield amounts to 7.1%, with dividend growth slowing to reflect a desire to reduce indebtedness (we estimate the net debt/EBITDA ratio declining to 1.8x in FY23).

https://www.equitydevelopment.co.uk/research/green-shoots-now-visible

Ultimate Products' interim results strongly suggest that the company is well placed for sales growth acceleration in H2 and to meet current market expectations. Online sales in H1 increased by 78% to represent 26% of group total, which is positive as this distribution channel has a smaller skew to H1 than others. Moreover, UPGS’s brands continue to demonstrate an ability to gain market share and grow through volume rather than pricing.

We maintain our view that the company’s current valuation does not fairly reflect UPGS’s three key growth drivers - brands, online & supermarkets distribution, and international. With external headwinds easing, an H2 acceleration is in prospect. In addition, growth is volume driven off a strong financial base. We base our 250p fair value / share assumption on an FY2023 EV/sales ratio of 1.5x, 12x EV/EBITDA and 16.6x P/E.

https://www.equitydevelopment.co.uk/research/well-placed-for-sales-growth-acceleration-in-h2

Mpac, the specialist international business providing high speed packaging machines and complementary services, hosted an Investor Presentation covering their Full Year Results for the period ending 31st December 2022.

Tony Steels (CEO), Adam Holland (current COO and incoming CEO) and Will Wilkins (Group Finance Director) discussed the current strength of their order book, the steps they have taken to mitigate key supply chain challenges, and the timeline for the FREYR opportunity. The team answered a wide range of investor questions and discussed some key illustrative case studies.

The presentation has been divided into chapters for ease of viewing:
00:03 - Introduction from Tony Steels (CEO) and Adam Holland (incoming CEO)
03:33 - Summary of progress made, FY22 overview
07:52 - Mpac overview, business model & strategy
18:11 - Case Studies
22:57 - Financial highlights
38:16 - Questions & Answers

Link to full video recording: https://www.equitydevelopment.co.uk/research/mpac-group-fy-results-investor-presentation-video-24-march-2023

New detailed research report with audio summary here: https://www.equitydevelopment.co.uk/research/positive-surprises-in-year-end-trading-update

Eco’s pre-close trading update confirms revenue and EBITDA are ahead of current market expectations for FY23 that had previously anticipated modest growth relative to FY22. The better-than-expected results are being driven by an unexpectedly strong final quarter for Aivlosin in China combined with continued growth in South/Southeast Asia and Latin America.

We now expect FY23 sales of £84.7m and an adjusted EBITDA of £7.0m based on our interpretation of the statement.

With an EV of £66m, Eco currently trades on an EV/sales ratio of ~0.78 and EV/EBITDA of 9.4 – both well below norms for the animal health sector.

A nice £11m extension order announced for surveillance equipment from Chess Dynamics, subsidiary of Cohort ??

This expands their order book and further underpins our forecasts and Fair Value of 650p / share, as per recent research note: https://www.equitydevelopment.co.uk/research/record-closing-order-book

Link: https://www.equitydevelopment.co.uk/research/fy22-results-show-a-platform-for-growth

FY22 results show a platform for growth - For the year to 31 December 2022, Mpac Group reported revenue of £97.7m, +3.6%YoY, EBITDA (adj.) of £6.8m, ahead of our outlook, -39.3%YoY, and PBT of £3.5m. Service revenue grew 14.4%YoY to 23.6% of the total. The year-end closing order book was £67.2m (FY21: £78.4m). Net debt was £4.7m, which we expect to revert to a £7.5m net cash position in FY23

Orders underpin FY23 earnings visibility - The FY22 closing order book was £67.2m with order intake at £83.8m, compared to £83.9m in FY20 and £117.9m in FY21. By FY24 we expect a return to top line growth of above 10%YoY and EBITDA growth of above 30%YoY, with revenue from Service approaching 30% of total.

Supply chain pressure eases - As expected, Mpac required additional working capital in order to meet customer expectations and offset the impact of supply chain disruption. This amounted to £17.8m (our estimate: £18.7m), including inventory build to £9.6m. We forecast this to unwind as the backlog of projects completes in H1 23; Mpac reports that contract assets – projects awaiting final factory sign-off – peaked in Q4 22 as the supply of key electrical components improved, allowing project completion prior to shipment. Cashflow was also constrained by the timing of customer deposits carried over into FY23. We expect working capital to improve to above £3m, and FY22 net debt of £4.7m to revert towards an estimated 31 Dec 2023 net cash position of £7.5m. Mpac continued to progress development of casting and unit cell assembly equipment for the battery cell production line at FREYR’s Battery Customer Qualification Plant in Norway. Agreed changes resulted in a revised plan for delivery in Q1 23, and commissioning in Q2 23.

Appointment of new CEO - Tony Steels, who has led the Group since 2016, has announced his retirement. COO Adam Holland will become CEO post-AGM on 17 May. Adam joined Mpac in late 2022 having held senior positions worldwide at JCB, Siemens AG and Rolls-Royce.

Fair value remains 485p - Following the January 16th Trading Update we raised our FY23 revenue outlook from £103.6m to £104.7m, (adj.) EBITDA by 13% to £9.6m, and our FY24 revenue outlook from £113.4m to £115.8m, with (adj.) EBITDA from £12.9m to £13.0m (see note here). We retain these estimates. Our fair value for Mpac remains 485p/share, indicative of a FY24 EV/EBITDA multiple of 7.9x.

As the acronym suggests, Kromek’s technology in the CBRN segment detects a wide range of threats, from radiological to biological hazards. These are united by two common themes: practicability – making ultra-high performance detection devices compact, robust and easily-deployed – and connectivity – enabling data sharing and analysis, to facilitate rapid response.

A number of recent events and reports around the world serve as a timely reminder that Kromek’s CBRN technology has urgent practical application – in both Radiological detection and Biohazard detection.

At the start of FY23, Kromek noted that it expected “a substantial year-on-year increase in revenue”. H1 results and prospects for the second half reaffirm this outlook, indicative of >40%YoY growth, to record revenue levels. In addition, we anticipate that the inflationary, exchange rate and supply chain pressures which impacted H1 23 profitability having stabilised will continue to ease.

Our forecasts remain unchanged, as does our Fair Value of 26p / share.

Link to new note with audio summary: https://www.equitydevelopment.co.uk/research/timely-reminders-of-an-unsafe-world

PensionBee Group plc, a leading online pension provider, conducted an investor presentation covering the company's Full Year results for the period to 31st December 2022.

Romi Savova, founder & CEO, and Christoph Martin, CFO ran investors through the strategic pillars underlying PensionBee's growth ambitions and investments, and the vast scale of the market opportunity.

They provided an overview of the financial performance for FY22, discussed their high customer & asset retention rates, and progress towards achieving profitability on an Adjusted EBITDA basis by Year End. The management also took part in a wide-ranging Q&A session answering questions submitted by investors.

If you missed the live event, you can watch the full video below, divided into chapters for ease of viewing:
0:00:03 Introduction to PensionBee story
0:00:45 Strategic Overview
0:11:06 Finance Overview
0:19:39 Guidance Framework
0:21:25 Investment Highlights
0:22:22 Question & Answer session

Link to video: https://www.equitydevelopment.co.uk/research/pensionbee-investor-presentation-fy-results-march-2023

New Equity Development note out : The Sebela partner deal and fundraising puts DEST into a position of strength for subsequent deals, and Fair Value is now 267p/share after adjusting for new shares, as you can read + hear below:

https://www.equitydevelopment.co.uk/research/onwards-and-upwards

Research report & audio summary: https://www.equitydevelopment.co.uk/research/growth-and-delivery-driving-strong-investor-interest

In FY22 (to 31 Dec 22) PensionBee continued to rapidly grow, despite market falls, and gain market share (page 2) in the structurally growing £700bn target market of transferable DC pensions (page 12). Invested customers grew 56% to 183k, AUA 17% to £3.03bn (net inflows +£863m, market movements -£424m), and revenue 38% to £17.7m. Adjusted EBITDA started to ‘turn the corner’ towards profitability and is forecast to turn positive on a monthly basis by the end of 2023. The net cash position is robust at £21m with no new cash raising envisaged.

We also flag the encouraging jump in investor interest in PBEE shares - especially after its Jan 23 trading update which showed the path to profitability was on track - with the recent price rise accompanied by strong volumes. On top of its fundamentals, PensionBee’s inclusion in the FTSE All-Share and FTSE SmallCap indices from 20 Mar 23 should be another positive for the share price.

PensionBee’s customer acquisition growth path compared to incumbents indicates it is rapidly gaining market share. In H2 of 2022, it added 24k net new invested customers (H2-22 annualised growth rate of 30%):
• This was more than double the total number of net new D2C platform clients (pension and other clients) added by AJ Bell (10k, which translated to an H2-22 annualised growth rate of 7%).
• And it was only a little less than the total number of net new clients (pension and other clients) added by the UK’s largest D2C investment platform, Hargreaves Lansdown (HL), which added 31k (an H2-22 annualised growth rate of 4%), and much higher than HL’s new pension accounts (13k net new SIPP accounts and 16k ISA and other accounts).

Our forecasts remain unchanged, as does our fundamental value of 150p per share.

New research note from Equity Development - link here: https://www.equitydevelopment.co.uk/research/disposal-of-t-juice-intellectual-property

Supreme reports that it has entered into an agreement with an associated company of La Vape Professionelle Distribution (LVP), a leading French wholesaler of e-cigarettes and e-liquids, for the disposal of the intellectual property (IP) of T-Juice, inclusive of the Red Astaire brand.

Supreme will receive an upfront payment of €4.5m (£3.97m) in respect of T-Juice brand IP, with the addition of income from consultancy services. The agreement ushers in a new strategic partnership in which Supreme will have exclusive manufacturing rights for T-Juice brands. We estimate that this will amount to at least €15.0m (£13.3m) in revenue over the coming five years, although the terms of the partnership – involving wholesale pricing arrangements – mean that our earnings outlook for the Group is unchanged.

Under the terms of the agreement with LVP:
• Supreme retains responsibility for flavour development and manufacturing, thus maintaining opportunities for supply chain synergies and improved margins.
• Enjoys simplified access to European distribution and expansion, at reduced cost, with LVP as the single point of reference.
• Has further cross-selling opportunities from the Supreme product portfolio.

We raised our outlook on the basis of strong Interim results and the subsequent Trading Update added evidence of continuing positive momentum supporting our outlook and our Fair Value of 190p indicative of a FY24 EV/EBITDA of 9.0x.

The Artisanal Spirits Company (AIM: ART), the owner of The Scotch Malt Whisky Society (SMWS), the leading curator and provider of premium, single cask Scotch malt whisky and other spirits for sale primarily online to a discerning global membership, is pleased to conduct an online presentation for retail & private investors following the release of their Full Year results for the period to 31st December 2022.

The event will take place at 2.00pm on Thursday 30th March.

Andrew Dane, Chief Executive Officer, and Billy McCarter, Interim Finance Director will be hosting the presentation and answering questions submitted by investors.

This is open to all existing and potential shareholders - you can sign up to register below.

Link: https://www.equitydevelopment.co.uk/news-and-events/artisanal-fyresults-presentation-30march2023

Strix Group plc, the AIM quoted global leader in the design, manufacture and supply of kettle safety controls and other complementary water temperature management components, will be conducting an investor presentation covering their Full Year results for the year ended 31st December 2022.

The online presentation will be hosted by Mark Bartlett, CEO, and Raudres Wong, CFO.

This event will take place at 10.00am on Friday 31st March.

The webinar is open to all existing and potential shareholders. Questions can be submitted during the presentation to be addressed at the end.

Sign up to register here: https://www.equitydevelopment.co.uk/news-and-events/strix-fypresentation-31march2023

Ultimate Products, the owner, manager, designer and developer of an extensive range of value-focused consumer goods brands, will be conducting a live presentation following the release of their Interim Results.

The event will take place at 11.30am on Thursday 30th March.

The online presentation will be hosting by Simon Showman (CEO), Andrew Gossage (Managing Director) and Chris Dent (CFO) and is open to all existing & potential shareholders. Questions can be submitted during the presentation and will be addressed at the end.

Sign up to register here: https://www.equitydevelopment.co.uk/news-and-events/upgs-investor-presentation-30march23

Link to video: https://www.equitydevelopment.co.uk/research/bm-half-year-results-investor-presentation-march-2023

Brooks Macdonald Group plc, the AIM-listed investment management group, conducted an online presentation outlining their strategy to reach their ambition of being a top 5 Wealth Manager, following the release of their Half Year results for the period to 31st December 2022.

Andrew Shepherd (CEO) and Robin Eggar (Managing Director, Head of UK Investment Management) ran investors through the details of their H1 financial highlights, which included a 7th consecutive quarter of positive net flows, an increased dividend and two completed acquisitions. The team also updated viewers on the ongoing growth in the MPS division and their M&A objectives.

The full video is available below, divided into chapters:
0:00:03 Introduction & summary H1 highlights
0:03:51 H1 financial results review
0:15:14 H2 outlook & guidance
0:16:04 Strategy Update
0:20:54 Growth Strategy (three value drivers)
0:36:33 Questions & Answers

Full detailed new research report & audio summary:
https://www.equitydevelopment.co.uk/research/q1-results-consistent-growth-continues

Summary: For the three months to 31 December 2022, Benchmark Holdings reported revenue +36.2%YoY at £54.5m, and (adj.) EBITDA +47.7%YoY (excluding fair value adjustment for biological assets, +61%YoY), to £11.0m reflecting the combination of strong top line growth, capacity utilisation and cost control. As a result, (adj.) EBITDA profitability continued to improve, from an average of 19.7% through FY22, to 20.1%. The operating loss was £0.12m (Q122: £1.46m loss), on an adjusted basis, a £0.85m profit. The Q1 cash position was £42.8m and net debt (excluding leases) reduced from £47.5m at December 2022 to £37.9m1. Cash at 24 February 2023 was £37.5m.

The strength of Q1 23 performance, and in particular the contribution from the Health business area, gives substance to Benchmark’s stated confidence in the outlook for FY23. We have raised our FY23 (adj.) EBITDA outlook by 11% to £36.5m, and for FY24 by 9% to £43.0m, equating to a FY24 EV/EBITDA of 8.0x.

Our fair value for Benchmark remains 63p/share.

*** Benchmark Holdings - Investor Presentation (Q1 Results) - 1st March 2023 ***

Benchmark Holdings plc, the aquaculture biotechnology company, conducted an investor presentation following publication of their Q1 results for the three month period ended 31 December 2022.

Trond Williksen, CEO, and Septima Maguire, CFO, took investors through the highlights of the period and a detailed financial review by business area (Genetics, Advanced Nutrition, Health). The management discussed the significant uplift in the Health division with increasing adoption of Ectosan®Vet and CleanTreat®, and also touched on current trading & outlook. The team also took investor questions which covered areas such as the growth of the aquaculture industry and potential de-listing from AIM.

The full video recording is available below, divided into chapters:
0:00:03 Introduction & summary Q1 highlights
0:05:25 Business area highlights (Genetics, Advanced Nutrition, Health)
0:17:31 Financial Review
0:27:22 Current trading & outlook
0:30:31 Conclusion & Benchmark's unique value proposition
0:33:28 Questions & Answers

Link to full video: https://www.equitydevelopment.co.uk/research/benchmark-holdings-investor-presentation-q1-results-march-2023

Research report & audio summary here: https://www.equitydevelopment.co.uk/research/forecasts-up-on-positive-outlook-dividend-8

Brooks Macdonald (BM) recorded a solid H1-23 (to 31 Dec 22) with FUM up 4% to £16.2bn, from £15.7bn on 30 Jun 22. Net inflows totalled +£347m and investment performance +£212m (+1.4% compared to -0.3% of the benchmark MSCI PIMFA Private Investor Balanced Index).

A 7th consecutive quarter of positive net flows was recorded, with impressive resilience through the 2022 bear market, pointing to very strong fundamentals when it comes to attracting and retaining client assets. In calendar-2022, BM’s net inflow rate was one of the highest among a London-listed peer group of wealth managers and platforms.

We have upgraded our FY23 and FY24 FUM forecasts on a more positive net flow outlook than we originally assumed, and on a mark to market adjustment of FUM levels. We now forecast £17.4bn FUM at end-FY23 (previously £17.0bn). Our revenue forecast increases from £119.5m to £122.8m on the FUM upgrade, current yields being slightly higher than our original assumptions, and on contributions from acquisitions. Our underlying PBT forecast increases from £31.7m to £34.1m.

Our fundamental valuation increases to 3,150p per share, 57% above the current share price. We also flag that BM’s PER of 13.5 is 36% below a peer group median of 21.2, which doesn’t look justified.