Surgical Innovations – 1.3p

31 March 2020 – final results

Revenues in the year to 31 December 2019 were £10.73m (2018: £10.97m) and gross margin was within the target range at 40.4% (2018: 42.6%).  Adjusted profit before tax was £0.38m (2018: £1.43m) and adjusted earnings per share 0.05p (2018: 0.21p).  Closing net cash was £0.47m (2018: £0.38m).  The results have clearly been overshadowed by Covid-19, which is causing a significant reduction in revenues in the near term.  We remain confident in the long term potential for the business but there will no doubt be pressure on cash in the near term.  We believe the shares are a HOLD for now.

Northern Bear – 50p

31 March 2020 -trading update

The company has provided a detailed update on trading for the year to 31 March 2020, the impact of the COVID-19 pandemic and the renewal of bank facilities.  The company’s current expectation is that operating profit for the year to 31 March 2020, stated before amortisation and other adjustments will be in the range of £2.2m to £2.3m as reported, or approximately £2.3m to £2.4m if including a full year’s effect of the recent acquisition of Lister Holdings (York) Limited versus £3.2m as reported in the prior year.  The existing £3.5m revolving credit facility with Yorkshire Bank, which was due for renewal in May 2020, has been renewed both ahead of schedule and on slightly better terms than those previously in place. This provides working capital facilities committed to May 2023.  A £1m overdraft facility, which is renewable annually, is also in place.  The company is facing uncertainties in the near term but feels that it is well positioned to ‘weather the storm’.  We agree and keep our BUY rating.

Xpediator – 23.5p

31 March 2020 – Covid-19 update

A trading update has been released ahead of final results for the year ended 31 December 2019 being released in April.  Turnover should be up 19% to £212m (2018: £179.2m) and profit before tax slightly above £5.0m.  Trading in the first three months of 2020 was in line with expectations.  Given current material uncertainties, it is not practical for the company to give longer term guidance at this time until there is greater clarity around the duration and full effects of COVID-19.  As at 31 December 2019 the company had net cash of £6.9m and has sufficient headroom within the business to manage anticipated working capital requirements.  Cost savings are expected to come from furloughing staff, agreeing temporary pay reductions and reducing other overheads.  The company expects to propose a final dividend for the year ended 31 December 2019, but the amount is yet to be determined given the uncertainties that currently exist.  We believe the shares are cheap and rate them as a BUY.

Belvoir Group – 94.5p

30 March 2020 – final results

The UK’s largest property franchise group has announced final results for the year ended 31 December 2019.  Group revenue increased by 43% to £19.3m (2018: £13.4m).  Profit before tax was £5.6m (2018: £5.5m including an exceptional credit of £0.6m), with diluted earnings per share edging up from 12.6p to 12.9p.  The company has a strong balance sheet with cash of £3.6m at the year end (2018: £1.8m) and net debt reduced significantly to £6.9m (2018: £9.6m).  However, in response to Covid-19, the final dividend was scrapped for the current year.  The shares have come down significantly from what appeared to be a full valuation earlier in the year so for now we rate the shares as a HOLD.

Wynnstay Group – 210p

24 March 2020 – AGM statement

Trading in the first four months of the new financial year was subdued.  However, this was anticipated and it was broadly in line with management expectations. This reflected generally lower farmgate prices, severe wet weather that limited sowing activities and continued farmer cautiousness.  The situation regarding Covid-19 and the financial impact of this on the business is difficult to predict.  Wynnstay Group has a strong balance sheet, substantial headroom in banking facilities and broad spread of activities.  These factors should help in a very challenging time.  It has also been confirmed that the final dividend for the financial year ended 31 October 2019 is 9.40p per share.  We rate the shares as a BUY.

cityconfidential © 2020 | T&Cs | Privacy | Wealth Warning