23/06/2023

Reabold Resources (RBD), the oil & gas investing company, announced that it has completed its further investment in LNEnergy Limited, increasing its equity interest in LNEnergy to 16.2%. Reabold retains the Second Option.

Comment: The disconnect between the share price of RBD, and the operational / investment side continues. At least announcements like today show the company is happy to continue with its growth strategy, on the basis that this will be the best way of delivering value to shareholders.

Acuity RM Group (ACRM) announced that Simon Marvell will retire as CEO of Acuity Risk Management Ltd, the Company’s wholly owned operating subsidiary. Kerry Chambers, the current COO of Acuity, has been selected as Simon’s successor and will be appointed as a director of the Company and the CEO of Acuity on 3 July 2023. The company said Kerry has demonstrated her skills and proved an excellent leader of sales, marketing and commercial activities over the past two years, it was delighted to announce her promotion to CEO and looked forward to working with her as she leads the business in the next exciting phase of its growth.

Comment: Ms Chambers has already got Acuity off to a flying start with the recent share price surge, so the logic of being made CEO is something of a no brainer, and was to be expected.

Audioboom (BOOM), the podcast company, today provided an update on current trading. The company said during 2023, the operational KPIs have continued to demonstrate year-on-year growth, however, the advertising markets have remained challenging for longer than anticipated. Whilst it believes the advertising markets will improve – with the company being in prime position to take advantage when they do – the company expects the revenue and adjusted EBITDA for the current financial year to be lower than previously anticipated.

Comment: After all the showboating of the past couple of years regarding allegedly important KPIs, the one that apparently trumps them all – advertising, takes its toll. It is ironic that a company involved in comms, has not sorted out its comms with its investors.

Phoenix Copper (PXC), the AIM-quoted USA-focused base and precious metals emerging producer and exploration company referred to the short-term $2,000,000 loan facility announced on 24 March 2023, and confirmed that the initial three month term has been extended for a further three months, also at a fixed 4% coupon. The company said it retains the option to extend the Loan Facility beyond the Extended Initial Term until 23 March 2024 on the same terms as previously announced.

Comment: With most investors arguably still playing the funding waiting game with PXC, it comes as almost something of a relief that the company is only paying 4% on its short term loan facility.

RiverFort Global Opportunities (RGO), the investment company listed on AIM, announced its audited final results for the year ended 31 December 2022. The company said 2022 was a difficult year for small cap listed companies and for those companies with a technology focus. Whilst a significant gain was achieved from the company’s investment in Smarttech247 notwithstanding this market backdrop, the company has taken a prudent view on the value of its portfolio and adjusted the value of certain of its investments downwards to reflect the current weak economic background.  Whilst the company has continued to generate investment income for the year, the net impact of these non-cash adjustments has, unfortunately, led to an overall loss for the year.

Comment: 2022 was indeed a painful year in the small cap space, and it can be seen that RGO seems content to kitchen sink the gloom and doom. That said, Smarttech247 was an outstanding success, and perhaps reminds us that even in current markets, there are strong opportunities.

Zenith Energy (ZEN), the international energy production and development company, announced that it has signed a MOU with the Ministry of Petroleum in the Republic of South Sudan. The company said South Sudan is endowed with a prolific petroleum system and has been the focus of our attention in recent months. It believes there are potentially many commercially attractive opportunities in-country for Zenith to acquire and develop successfully.

Comment: ZEN goes back to its African initiatives, after the recent re-focus on adding USA revenue. Arguably, with the Stateside angle now in place, ZEN can be more aggressive in going to potentially high reward prospects in the rest of the world.

Galileo Resources (GLR) informed shareholders on progress in relation to JSE Listed Afrimat Limited’s option to buy for ZAR300 million (approx. GBP12.8M) shares in and shareholder loans made to Glenover Phosphate Proprietary Limited. GLR said it was very pleased with the amended agreement regarding phase 2 of the Glenover/Afrimat transaction.  Afrimat is a very proactive and progressive company and it was pleased to become shareholders in that entity, and look forward to the final cash payment in April 2024, which will conclude the transaction in its entirety.

Comment: After a little spring flourish we have seen shares of GLR drift back towards the 1p zone, an area which, as we are reminded with this latest RNS, the stock would appear to be in the value zone.

Dekel Agri-Vision (DKL), a West African agriculture company, said it has agreed with AgDevCo to modify the terms of the existing loan facility. The company said this is an excellent outcome to fix the interest rate given the backdrop of significantly rising global interest rates and also reflects the current strong performance of the Palm Oil Operation. All its debt obligations are now fixed which positions it well to manage interest expense obligations whilst it commences its strategy to decrease debt levels in 2023 and beyond from the positive cashflow being generated from the Palm Oil Operation and also from the Cashew Operation as it ramps up production. It also looked forward to continuing its excellent ongoing partnership with AgDevCo.

Comment: This  appears to be a canny deal for Dekel, and at the right time given the spike in the cost of money. DKL can now focus on ramping up production, something which the market has yet to factor into the company’s valuation.