finnCap Research Company Notes - 5 June 2020
Jun 05, 2020 / News
M.P. Evans (MPE) : Corp |
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AGM update: excellent start to the year |
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MPE has released an AGM trading statement covering the first five months of the financial year (to end May 2020). The statement highlights a very strong start to the year with +16% y-o-y growth in FFB harvest and +35% y-o-y growth in CPO equivalent volumes. Production YTD is consistent with, or slightly ahead of, our full-year forecasts, and we expect the usual seasonal weight to H2. Significantly, the COVID pandemic has had no impact on operations, cash generation remains strong and investment continues as planned. We are making no changes to our forecasts or price target. |
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Somero Enterprises (SOM) : Corp |
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Trading update |
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The group’s trading update has identified that COVID-19 has reduced sales by around 25% from that expected at the start of the year, although with a flexible operating model and cost and cash-saving actions taken, the group remains profitable and cash generative. Indeed, the balance sheet remains robust with $24m in cash, a similar level to March. The outlook for customer demand remains uncertain, while investment in NPD has been maintained in order to accelerate sales once the recovery occurs. Our forecasts remain under review, while prospects for the long-term remain strong. |
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Revolution Bars Group (RBG) : Corp |
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Proposed equity fundraising and move to AIM |
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New management has put in place a strategy which the February interim results revealed was returning the group to growth with very encouraging LFL statistics and attractive returns on refurbished outlets. In March, however, in response to COVID-19 and following UK Government guidelines, all venues had to be closed. Management initiatives have materially reduced the cash burn while the group is unable to trade, and the group’s lender has been very supportive in significantly increasing the borrowing facility. Management is now proposing an equity issue, the rationale for which is to strengthen the leverage ratio to create a more appropriate capital structure moving forward, to allow an immediate return to the estate refurbishment programme and to be able to potentially take advantage of strategic opportunities as they arise as the sector emerges from the COVID-19 crisis. |
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