Trader's Cafe with Zak Mir: Braveheart, Horizonte, Oracle Power, Prospex, Supply@Me Capital, Westminster Group
Chunky percentage gains for much followed small cap stocks can very often be as much a factor of those short of the shares panicking to cover their positions, as bulls buying into the situation. This is what we may have been witnessing at inventory monetisation group Supply@Me Capital (SYME). The company may have underpinned the latest spike in its stock by announcing the appointment of of Dr Thomas James and Mr John Collis to the Board of the Company as Executive Directors. All of this comes after the recent completion of the acquisition of TradeFlow Capital Management, and the Company's 2020 Annual General Meeting at the end of last month.
Technology-based security solutions company, Westminster Group (WSG), announced its unaudited interim results for the six months ended 30 June 2021. Here the company has scored two significant managed services contracts in Africa, as well as security contracts for the Palace of Westminster and Tower of London, and developing a new Covid-19 testing programme initiative in partnership with Certific. Group revenues up 16% from H2 2020 to £3.5m (H1 2020: £7.0m, H2 2020: £3.0m). Gross margin increased to 45% (H1 & H2 2020: 40%) and the company says it is now effectively debt free with a £3.1m cash balance.
International natural resources project developer, Oracle Power (ORCP) continues to progress its Australian activities near to a world famous prospective mining zone. It said that the Department of Mines, Industry Regulation and Safety - Western Australia, has approved the Company's Programme of Work for the Northern Zone Gold Project, located 25km east of Kalgoorlie in Western Australia. According to Oracle the objective of the first phase of the PoW is to complete seven Reverse Circulation drillholes up to 260 metres deep, for a total of ~1,500 metres, specifically targeting gold mineralisation within a series of stacked porphyry intrusions.
There are placings that are expected, and those that are not. In the case of Braveheart Investment Group (BRH), the latest at 18p, raising gross proceeds of £2,5m may not have caught many of guard as the stock has fallen from 40p plus over the past few weeks. At least the management have led from the front with CEO Trevor Brown, directly or indirectly subscribing for 8m shares. The company said it intends to use the net proceeds of the placing to enable it to accelerate the development of Paraytec's Covid testing instrument by taking direct control of the final design and engineering packages.
It may be argued that since the pandemic began relations between some shareholders and their board have not been quite as harmonious as they were perhaps before. Prospex Energy (PXEN) announced that it has received a letter from a group of shareholders requesting a GM. The Requisition proposes that shareholders be asked to consider resolutions related to changes to the Board, including the removal of existing and proposed Directors and the appointment of new Directors, and share authorities. It will be interesting to see how this situation pans out given that Prospex has said that on the basis of legal advice, this is not a valid request under section 303 of the Companies Act 2006 as the documentation received is not valid. Therefore, the Board is not obliged to call the GM.
Nickel development company focused on Brazil, Horizonte Minerals (HZM), published its unaudited financial results for the six month period to 30 June 2021. The company said project financing of Araguaia is nearing completion with credit approval process underway following completion of due diligence by the International Lenders. In addition, a Senior Debt Facility is expected to benefit from significant Export Credit Agency Support. A Cornerstone strategic investor and final offtake agreements are well advanced and expected to be finalised shortly after credit approvals. To cap it all, Horizonte had a cash position of £22.2m following completion of an £18m equity fundraise in February 2021, suggesting it has plenty in the coffers to take its programme forward.
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