The consumer finance firm;’s shares tanked to 7.62p after the board said “a material uncertainty exists relating to going concern primarily due to COVID-19”.
The group said there was a near cessation of lending from about the middle of March, although post lockdown collections were said to be “robust” at around 86% of previous levels.
As at the end of May, the group had cash in the bank of £60.3mln and gross borrowings of £345.0mln. The impact of COVID-19 on the loan book has prompted a breach of certain performance covenants, preventing further drawdown on the company’s lending facility but negotiations with the lender were described as positive and temporary relief has been provided until June 29.
1.00pm: MITIE’s business weathers the coronavirus storm better than expected
The stock was up 6.1% at 84.9p after the company announced a fully underwritten rights issue to raise £201mln on the basis of 11 new shares for every five currently held at 25p a pop.
The company also announced an extension of its revolving credit facility, an agreement to acquire Interserve’s facility management business for £271mln (to be paid in cash and shares), a strategic update and its full-year results.
The share price rise was most likely prompted, however, by the statement that the business is providing to be “more resilient to COVID-19 than initially expected”.
11.45am: Next Fifteen wanted after a reassuring trading update
In a presentation to the company’s annual meeting, chief executive Tim Dyson said: “Overall trading remains consistent with the update provided in April, the new business pipeline remaining largely positive with a number of new assignments being won.”
The marketing and communications specialist said it has won work from Ernst & Young, the World Health Organization, Photobox and Sainsbury’s Argos as well as additional assignments from Amazon, Google and Salesforce, and expects to deliver “modest growth” in revenues and profitability in the first half of its financial year.
10.50am: Chesterfield Resources rises after drilling starts at Troodos West
The news sent the shares 8.4% higher to 5.8p.
The project team will initially test a number of target areas to assess their prospectivity, before rolling out an expanded programme.
10.00am: Eden Research boosted by US patents decision
The AIM-quoted company focused on sustainable biopesticides said it has secured patents for its Sustaine encapsulation technology and compositions for insecticide products from the US Patent Office.
Sustaine microcapsules are naturally sourced, plastic-free, biodegradable micro-spheres derived from yeast extract. The Sustaine microencapsulation technology enables the use of naturally occurring terpenes for application in commercial crop protection, Eden said.
9.05am: Sealand Capital soars after forming JV with Chinese internet giant Tencent
Sealand Capital Galaxy Limited (LON:SCGL) soared 181% to 1.45p after it formed a joint venture company, Tengwuyang Holdings, with a subsidiary of e-commerce giant Tencent.
The purpose of Tengwuyang is to create a new path for foreign merchants to sell their goods and services into the Chinese market.
The Tencent subsidiary, Tenet, is a short videos producer that has been working with Sealand’s subsidiary, New Sky Global Media Limited, since 2019. Together, Tenet and New Sky Global Media have rendered short video production services, helping multi-national companies to enhance and raise their brand images in China.
The statement, released ahead of today’s annual general meeting, revealed that with just one week left in the first half of the year. revenue has been roughly 7% higher than in the same period of 2019.
“Our outlook for the remainder of 2020 is broadly positive at this stage. Domestic demand for wheeled toys, outdoor products and bicycles is showing no sign of abatement. The FOB [free on-board] order book, although behind the prior year, is growing in preparation for the Christmas period,” the sport and leisure equipment maker revealed.
Proactive news headlines
BATM Advanced Communications Limited (LON:BVC) shares jumped to 19-year highs on Wednesday after the real-time technologies company hiked its full-year revenue and earnings expectations.
Blue Star Capital PLC (LON:BLU) said its investee company, Guild Esports PLC, has announced its global launch and an association with David Beckham as it looks to develop a talent pipeline in the UK. Beckham and Blue Star have both taken part in a £25mln fundraising by Guild.
ReNeuron Group PLC (LON:RENE) has signed a research evaluation agreement with an unnamed “major biotechnology company” with the pair set to collaborate on a technology that can deliver gene-silencing therapeutics.
Westminster Group PLC (LON:WSG), the security and managed services specialist, has started a new project to introduce specialist ‘unattended retail’ vending machines that will dispense masks and facial coverings in the UK.
Rosslyn Data Technologies PLC (LON:RDT) said it has secured renewals for a number of client contracts with extended durations that it says will underpin its current annual recurring revenue (ARR) expectations in future periods.
Advanced Material Development subsidiary CoM3D has completed a £1mln funding round to continue developing nanomaterial technology at the University of Texas at Austin.
Eden Research PLC (LON:EDEN) has been granted two important patents for its technology in the USA. The AIM-quoted company focused on sustainable biopesticides, said it has secured patents for its Sustaine encapsulation technology and compositions for insecticide products from the US Patent Office.
ANGLE PLC (LON:AGL) has hailed “major progress” in its latest results as it targeted regulatory submission for its Parsortix system to the US Food and Drug Administration (FDA) in the third quarter of 2020.
Stobart Group Ltd (LON:STOB) confirmed that 56.4% of shares available to existing shareholders had been taken up in the open offer element of its £100mln fundraising. The remainder of the shares have been allocated to institutional investors who took part in the placing.