Flowtech Fluidpower – 166p

17 October 2017 – trading update

The group has issued a trading update covering the nine months to 30 September and this has revealed that revenue for the period was 34% above the previous year at £54.45m (2016: £40.50m) with organic growth supplemented by additional revenue from acquisitions.  In the current financial year the group has so far made six acquisitions with three of these being made in the last quarter.  All of these acquisitions have added to or enhanced the group’s position with key European or global suppliers , broadened the group’s sector and geographic coverage and added to its technical competence.  With another year of solid progress in prospect the shares remain a BUY.

Pressure Technologies – 129p

16 October 2017 – fund raising

Following the earlier announcement, the company has confirmed that it has issued 4.1m shares at a price of 122p to raise £5.0m in an oversubscribed placing.  The fact that the placing was oversubscribed is clearly encouraging as is the share price recovery today.  We maintain our recommendation of BUY.

Pressure Technologies – 117.5p

16 October 2017 – fund raising

The group is proposing to raise approximately £4.5m through a placing of shares by way of a bookbuilding process being undertaken by brokers Cantor Fitzgerald.  As such the number of new shares to be issued and the placing price are not yet known.  The reason for the placing is to provide funds to reduce the company’s debt and also provide funds to invest in the business some parts of which are seeing an increase in business activity.  The group has also revealed that delays in certain orders together with cost overruns on certain contracts will lead to lower than expected profits for the year to 30 September 2017.  Although this is clearly disappointing we continue to believe that long term prospects remain encouraging and we therefore maintain our recommendation of BUY.

Augean – 24p

16 October 2017 – board changes/trading update

The group has announced a board restructuring which has seen the resignation of chief executive Stewart Davies with non-executive chairman Jim Meredith moving into an executive role.  The company has also appointed two new non-executive directors, including Roger McDowell who was a board member for 11 years between 2004 and 2015 including stints as interim CEO and interim chairman.  His experience should prove invaluable at this difficult time.  The company continues to be in discussions with HMRC regarding the claim for landfill tax and no resolution is expected for some time.  The group has also stated that trading continues to be weaker than expected and another round of cost cutting has been undertaken which will save £1.7m annually.  The cost of this will be £0.9m and this will be taken in the current financial year.  Given these uncertainties we maintain our recommendation of HOLD.

Norcros – 176p

12 October 2017 – trading update

An update on trading in the first half of the year has been released ahead of interim results, due out on 16 November.  Group revenue for the first half is expected to be approximately £144.9m (2016: £128.8m), 12.5% higher than the prior year and 7.1% higher on a constant currency basis. There has been ‘robust performance’ in the UK business and continued growth in the South African business.  These figures are in line with expectations and it is pleasing to note that net debt as at 30 September was down to £21m versus £27.5m a year earlier.  The shares continue to look very good value and we retain our BUY rating.

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