Small Cap Value Report (Weds 19 May 2021) - DIA, SAG, CREO, KGH

19th May '21 by Paul Scott

42 comments 8825 reads

Good morning, it's Paul and Roland here. A big welcome to Roland Head, who has kindly agreed to step in and help out here at the SCVR, to give Jack some study leave. Roland is a highly experienced investment analyst and writer, and can be found on Twitter: @rolandhead

StockSlam - a reminder that this popular free webinar starts tonight at 18:00. Anyone can do a 3 minute pitch for any stock, so why not get involved?! It's good fun. Register here.

Timing - we should be finished by 1pm.

Agenda -

Paul's Section:

Dialight (LON:DIA) - in line with expectations trading update, but orders above expectations. Does this mean the turnaround could be gathering pace? Who knows, not enough information is provided.

Science (LON:SAG) - A strong trading update, with H1 profit guidance 30% up on last year's excellent H1. Mentions potential supply chain problems (as many companies are saying). Valuation still looks attractive to me. A thumbs up from me - holders should be pleased with the group's progress.

Roland's Section:

Creo Medical (LON:CREO) - a promising update from this medical device firm, but it remains a speculative situation.

Knights Group (LON:KGH) - This acquisitive legal services business says that revenue for the year to 30 April should be ahead of consensus. Knights Group has delivered strong growth since flotation, but the firm doesn’t yet have a very long track record as a listed business.

Paul’s section

Dialight (LON:DIA)

320p (pre market open) - £104m market cap

Trading Statement

Dialight plc (LSE: DIA.L), the global leader in sustainable LED lighting for industrial applications, is today issuing the following AGM trading update.

AGM trading update - encouraging start to the year

This relates to the FY 12/2021.

Looking back at its last results for FY 12/2020, the figures were a £(6.4)m underlying operating loss, not bad considering covid hit revenues hard, down 21% to £119m.

The outlook comments alongside these results sounded OK - this was published on 31 March 2021, so I’m providing it now for context -

Full year guidance for 2021

We are experiencing an increase in quoting activity early in the year and while the Group will continue to be impacted by COVID-19 during 2021 and will take steps to mitigate to the extent…

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TamzinPiworld

19th May '21

Benchmark Holdings (LON:BMK) interim results presentation to analysts, 18.5.21 by Trond Willliksen, CEO, and Septima Maguire, CFO. Good H1 performance with revenue growth +11% and Adjusted EBITDA +13% reflecting a strong performance in Advanced Nutrition and solid trading in Genetics and Health. Significant progress towards commercialisation of BMK08 and Clean Treat. Positive outlook and trading in line with market expectations, with good revenue visibility for the second half. Video & Podcast.

Forthcoming piworld webinars:

(As mentioned above) Stockopedia/piworld StockSlam is tonight at 6pm. Register here.

Cerillion (LON:CER) Interim results webinar following excellent results earlier this week. Thursday 27th May, 4pm. Register here.

Ig Design (LON:IGR) Full year results webinar on the day of results, 15th June, 12 noon. Register here.

Michelmersh Brick Holdings (LON:MBH) investor webinar May 18th, 10am. Although hit by CV19 for FY20, going forward the sector looks to be a beneficiary. Register here.

gus 1065

Anyone interested in premium single malt scotch? PrimaryBid are offering shares in the upcoming AIM IPO of the Artisinal Spirits Company, owner of the Scotch Malt Whisky Society. Think of the Naked Wines (LON:WINE) business model but for single malt whisky rather than non mainstream wines. Perk/requirement for applicants is to join the SMWS and receive some appropriate freebies and ongoing membership. More details including financial info (including a useful Edison IPO research report) on the PB app. Applications required by May 21st. Probably not one for me - been teetotal for the past few years!

Gus.

mepfish

I see that £PCF has suspended trading in its shares pending a review of financial controls and reporting. Hopefully none of the posters on here are impacted. fortunately I don't hold at the moment.

ridavies

For all Angle (LON:AGL) followers. Still looking for that Finncap alleged valuation / target valuation to be realised, and fell off a bit today. I have tried to addsomething to the Discussion page for Angle (LON:AGL) which covers a letter I wrote to the CEO last week, and the response which I read as positive for £AG. Failed, so seeking forgiveness from other contributors not interested in Angle (LON:AGL), here it is:

I was concerned about the effect of the negative results of the long term study on improved identification of ovarian cancer announced on 13th May. I wrote to the CEO of Angle (LON:AGL) to ask for their thoughts, and received this reply from the Head of Investor Relations.
Thank you for getting in touch. Andrew asked me to respond. We don’t believe there should be any impact on the market’s view of ANGLE as a result of this news.

The failure of this large screening study, whilst disappointing for women who may be at risk of ovarian cancer, is not a surprise to us especially given the previously reported results. Current diagnosis, as employed in this study, relies on imaging and elevated levels of serum biomarker CA-125. CA-125 can be elevated in healthy women for numerous reasons which makes it a poor analyte for detecting cancer. As a result, tests focused on CA-125 have poor specificity (false positives) in early-stage cancer.

As you know, ANGLE’s efforts in ovarian cancer are not focused on asymptomatic screening. Our clinical verification study, which is expected to report headline results in Q4 this year, is designed to establish the combination of Parsortix and our proprietary molecular analysis tool HyCEAD as a test to triage women with pelvic mass prior to surgery, to ensure that women receive the appropriate treatment while saving healthcare resources. Our test is measuring CTCs, which is a specific analyte (i.e. low false positives). Our previous studies have already demonstrated excellent sensitivity and specificity (AUC-ROC of 95.1% accuracy). Similar results in the ongoing study would position our test as ‘best-in-class’ and enable launch of a laboratory developed test from our newly established clinical labs around the end of this year. The molecular analysis could yield important information about the biology of the ovarian cancer allowing targeted therapies to be used which could improve outcomes.

Kind regards Andrew Holder Head of Investor Relations

sharw

This morning I 'attended' (via zoom) the AGM of EKF Diagnostics Holdings (LON:EKF) - full marks to those who encourage companies to have greater engagement with PIs, in this case Walbrook PR. Also this morning I find that the previously investor-shy Driver (LON:DRV) (last results presentation for analysts only) will be giving an investor presentation at its interim results next month (credit to Equity Development).

The EKF meeting gave more light on the board changes. The incoming CEO (current head of the Group's US operations) is based in the US for much of the year but spends time in Wales (where the company's HQ is) and to prove it his Welsh accent does not have an American twang overlaid! 57% of revenue last year was in the US and that will probably increase sharply so that makes sense. He was also given most of the credit for the deal with the 'large customer' that we are not allowed to name (but timarr has).

Gus, here's a overview of The Artisinal Spirits Company by the MD, as you say an online membership club to buy single cask Scotch malt whisky. Video & podcast.

The capital raised will be used to finance the growth of the business over the next 2-3 years, including investment in stock, supply chain efficiency; membership promotion and recruitment; selective investment in existing and new venues and investment in brand and digital development.

As you say, available though Primary Bid.

MaxPower27

Afternoon all - any views on the £IDHC results today? Reads positively to me as a holder with expectation growth will continue. Muted reaction an opportunity? Revenue up 19%, Net Profit up 21%, Net cash up 78%. Positive outlook: targeting double-digit growth in 2021 and an EBITDA margin of c. 40%. Maybe a hint of slower growth than before, but I find the reporting really encouraging. #Integrated Diagnostics Holdings is one I expect to compound for years to come. We will see!

Indie

Hi MaxPower27, I hold Integrated Diagnostics Holdings (LON:IDHC) and was pleased with the results too. I liked their scalable model of labs and, like you, hope it will be one that grows. The approved dual listing in Egypt would seem to be a good sign and, I understand, would increase liquidity. I put in my notes that they have a 7-year growth streak. Hoping regional stability gives them the chance to perform and expand, although their diagnostic services would , I imagine, always be in demand.

Edit: It's a Mid Cap

Dragon

I see Bitcoin is rolling across the table heading towards the edge.

rmillaree

PCF (LON:PCF)
I hold unfortunately for me - can't blame anyone other than me for holding this one there has sort of been clues here that there could be issues here - ignore the red flags and you only have oneself to blame - not good though that for what should be a reasonably simple business model they are in this situation. It's annoying when well paid bods can't get the basics right for whatever reason.

shanklin100

Is it worth contacting Walbrook PR to be able to Zoom-attend future Ekf Diagnostics Holdings (LON:EKF) meetings? Would have tried to attend if I had known this was possible.

IncredibleMosesLeroy

It will be interesting to see what Tesla did. Either Elon fibbed and they dumped bitcoin earlier (my hunch), in which case the memestocks crowd will desert him and possibly memestocks in general, or Tesla did not sell and just lost a tonne (Bitcoin below Tesla's announcement price as I type but who knows by time you read this, or I finish writing it), in which case institutional holders will desert him and futuretech stocks in general.

When Tesla rolls, so rolls Arkk et al, so rolls tech.

The dump-off begins?

EKF Diagnostics Holdings (LON:EKF) have advertised meetings in 'Notice of....' RNSs:

https://investegate.co.uk/ekf-diagnostics-hldg--ekf-/rns/notice-of-results/202103030700099258Q/
https://investegate.co.uk/ekf-diagnostics-hldg--ekf-/rns/posting-of-annual-report--accounts---notice-of-agm/202104230700073690W/

This morning they said that there would be a roadshow beginning Monday 7th June so suggest you look out for that.

It will be interesting to see what Tesla did. Either Elon fibbed and they dumped bitcoin earlier (my hunch),

Surely its highly unlikely that Musk would say anything factually incorrect (hmmm do i believe my own spill it is musk we are talking about ??) - that being the case i would think it highly unlikely any had been sold AFTER he started his "*hitposting" but before he clarified the situation. They might have sold something just before then though :) or just after his comments before the spike down.

Anything is possible with musk tho if he has lied or misquoted reality i presume he will be up infront of the sec in no time - probably no biggie for him and his paper/cash/crypto wad.

Tommy H

It looks a solid set of results

I have held Premier Foods (LON:PFD) for a while now (~5% portfolio) based on a long term turnaround and with the debt continuing to go down and the pension being managed downwards too, so slowly going from a single digit to double digit PE rating.

I look at the dividend as a nice bonus, but was not expecting for it for a couple of years, I was hoping that the focus was on clearing debt, but I guess this then adds this to "dividend payers" screen and funds, so maybe will get a little lift from funds thinking to add.

Tommy

Thanks Indie. Will be interesting to see impact of dual listing. Was also impressed with their management metrics in some of their presentations - gives me the feeling they are on top of things. We will see!

Yellowstone Advisory

20th May '21

Hi Paul, there was a Dialight (LON:DIA) webinar last week. It sounded from your comments above that you might have missed it so here is the link.

Robert W

Profits in line with expectations set in Feb. Sequential H2 on H2 increase of 45% - so pretty impressive. Current estimate for FY 21 (EGP 708) effectively implies slightly negative growth assuming H1 is 75% of last H2 - which is what it has been. Still need to read the details but that looks almost certain to be too low,

The refinancing of its £300m 6.25% interest 2023 debt is obviously very important.

Suggestion here...

https://www.globalcapital.com/...

is that interest rate may go down to circa 3.75%. If so, this would be a £7.5m p.a. benefit to Premier Foods (LON:PFD) which would be helpful to their annual profits.

Zoiberg

21st May '21

Parsortix has been around for a long time. Angle acquired it years ago. Sorry if I sound jaded but I was interested five (?)years ago. If I remember correctly Microfluidics is the name of the field they are in and it was when I started investigating their competitors that I lost interest. I may be wrong but I just can't summon the energy to investigate them again.

Good luck, things may have changed. I'll say no more.

Small Cap Value Report (Weds 19 May 2021) - DIA, SAG, CREO, KGH

Paul’s section

Dialight (LON:DIA)

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Paul Scott

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