05/07/2023

Graft Polymer (GPL), the specialty chemicals company offering modified polymer solutions for refiners, compounders and processors, announced the completion and commissioning of a bespoke production equipment site in Slovenia which is due around the end of July 2023, doubling the company’s production capacity. The company said the commissioning of this pivotal plant is testament to the group’s increasing commercial momentum in a promising market with a continued strong outlook for this year. It is confident that it will play a major role in transforming our ability to win larger customer mandates and strengthen competitive positioning within the speciality chemicals sector, centred on our excellent innovation and specialist production capabilities. Its enlarged scale will also drive greater cashflow generation to the benefit of shareholders.

Comment: The shakeout for the shares ahead of today’s announcement should provide an opportunity for bottom fishers, especially given the way that doubling production capacity is no mean feat. The current market cap of £3m and decent cash position offer good potential over the rest of the year.

Quiz (QUIZ) reported finals for the year-end to March 2023. The Revenue from this omni-channel woman’s value fashion brand increased 17% to £91.7m. The PBT skipped up 192% to £2.3m which is better than expectations for an EPS of 1.64p giving P/E of 6.5x at the closing price 10.65p and  net cash is £6.2m.  Perhaps, counter trend, its 129 UK Stores and Concessions grew 24% and faster than Online trading. It specialises in glamorous occasional wear and dressy casual clothes at value prices with added (full price) footwear and accessories.  QUIZ Eco collection is its first step to creating an environmentally friendly collection. The capsule collection is designed and manufactured in the UK via the Global Recycled Standard certified route. A £1.3m investment is being made to increase its distribution centre.

Comment: The shares are down from 17p this year on trading uncertainly and not helped by Schroders reducing its holding from 9% to currently 4.6%. Concerns of a consumer slow down seems to, so far, has been overdone, as today’s buoyant finals underline.  The company’s low cost and value for money ethos has provided some resilience.  There could be a chance to expand its retail footprint at bargain prices.

Zenova Group (ZED) announced that the increased demand for personal fire protection through Zenova FX aerosol fire extinguishers is accelerating the deliveries to Zensafe. The next shipment of 2,160 units of Zenova FX500 to Zensafe’s account with Amazon will increase the supply and shorten deliveries for its customers in the UK. This is the first shipment out of the current total order for 10,000 units with a retail value of £300,000 from Zensafe for the Zenova FX500.

Comment: There may be a cost of living crisis. But it would appear that as far as consumers are concerned, when the going gets tough, the tough buy fire extinguishers. The latest bounce for ZED shares could be the start of a long awaits recovery.

Reabold Resources (RBD), the oil & gas investing company, announced a new Corporate Presentation has been published on the Company’s website. The new presentation details the company’s recent investment in LNEnergy Limited. Investors can view the new presentation via the following link: https://reabold.com/investors/reports-presentations/ A video interview with co-CEOs Stephen Williams and Sachin Oza discussing the investment in LNEnergy Limited is available on the company’s website at the following link: https://reabold.com/media/

Comment: The market continues to be ultra harsh on RBD, despite the ongoing share buyback, the proof that the company knows how to enter and exit deals, and even within the context of softer underlying commodities. One would imagine that at some point soon the shares really will overshoot on the downside, if they have not done so already.

i3 Energy plc (I3E), an independent oil and gas company, has been notified that on 4 July 2023, Majid Shafiq, CEO, purchased 196,318 shares at a price of 12.7 pence per share. As a result, following this transaction, Majid Shafiq now has a total beneficial interest, in aggregate, of 9,734,609 Ordinary Shares, representing 0.81% per cent. of the Company’s issued share capital.

Comment: I3E is another company which has been given an overdone early summer share price rug pull. The shares are now back where they were at the beginning of last year, therefore excluding all the progress, production and dividend payouts since then. Director buying, especially with the CEO leading from the front, is something that investors should take seriously in terms of underlining the value at current levels.

Altona (REE), a resource exploration and development company focused on Rare Earths in Africa, is pleased to provide an operational update on its Mozambique rare earths project, Monte Muambe, which includes initial Pre-Feasibility Study in-fill drilling activities. The company said it has had a very busy second half of 2023 ahead of it, with a number of objectives to achieve; the MRE and Scoping Study being its immediate focus. Considerable attention will be given to the metallurgy of Monte Muambe, a key parameter for carbonatite hosted REE projects. The 2023 drilling campaign will specifically aim at expanding the high-grade orebodies in order to increase the resource base.

Comment: As much as the past and future progress at ANR, one should also be drawn to the expertise and experience of CEO Cedric Simonet, something that sets the company apart from its peers. The run up to the 2023 drilling campaign should favour ANR shares.

Orosur Mining (OMI), updated on the progress of exploration activities at its Ariquemes Tin Project in Brazil. The company said Work at Ariquemes Project has progressed as per the planned timetable, to allow it to gradually develop our understanding of the region and the local controls on mineralisation.  This work is now bearing fruit, and this current phase, if successful could mark a major milestone in identifying areas of economic mineralisation.  At a time of encouraging tin and niobium prices, this may provide the company with valuable optionality.

Comment: Brave talk from OMI today, as the company attempts to arrest the recent share price decline. As things stand the market seems to be looking for more, and stronger newsflow.

Kazera Global (KZG), the AIM-quoted investment company, updated on key corporate and operational developments. The company said it continues to make significant progress at both a corporate and operational level. Of particular importance is the increased cooperation and positive relationship between Kazera’s subsidiaries and Alexkor RMC JV, as it works together to create job opportunities for the local Richtersveld Community.

Comment: Shares of KZG have rather come off the boil since the peaks over 1p at the end of last year. While the lovey dovey / ESG friendly part of today’s update is all well and good, the market may be looking for more news like the acquisition of a further tranche of Kazera shares by AMS.

Prospex Energy (PXEN), the AIM quoted investment company focused on European gas and power projects, announced the start of gas production from the Podere Maiar-1 gas facility at the Selva field in the Po Valley region of northern Italy.  First gas was achieved following the completion of operational and safety inspections with successful sign off from UNMIG and the Fire Department and subsequent go-ahead from the Ministry last week, solidifying its authorisation for gas production at PM-1. The company said it was absolutely thrilled to be announcing the start of first gas from the Podere Maiar-1 well in the Selva Field, a pivotal milestone in the company’s development and a credit to the work of its partners at Po Valley Energy and their team on the ground, Po Valley Operations, who have made today’s announcement possible.

Comment: We have a white smoke over the Vatican moment for Prospex, with the first gas news. Ideally, this is the starting gun on the shares getting back to the brief February peak through 20p before the end of the summer. The market seems to have forgotten the importance of energy security alone being a reason to back PXEN.