Altitude Group (ALT) : Corp

Trading update

Key data

  • Share price (p) 20.5
  • Target price (p) 120.0
  • Market cap (£m) 14.2
  • Enterprise value (£m) 10.7

Altitude has confirmed performance for the 12 months to December 2019, after the logical decision to move the formal accounting period end of March 2020, announced in August. Revenue of £11.3m (vs £11.9mE) was in line with expectations after only three full quarters since the January acquisition of AIM, a commendable level of achievement and predictability for an early stage business. Current cash of £2.5m will be supported by inflow from the sale of ADP announced this week, in addition to outstanding receivables (US: $1m; UK: £0.5m) and the end April collection date for the 31 March quarterly cycle. The US preferred supplier base expanded to 175 (161 at 30/9/19) with more to join on 1st April; AIM membership grew to 2,276 (June 19: 2,185) including 141 on enhanced packages, and further revenue opportunities from financing. Altitude’s 12m to December focused on revenue development, and that has been achieved. Measures to accommodate the next few months include cost-saving initiatives already in hand, and we look forward to further updates.

Andrew Darley 020 7220 0547 adarley@finncap.com

Barkby Group (BARK) : Corp

Commercial Property Development in line

Key data

  • Share price (p) 16.5
  • Target price (p) U/R
  • Market cap (£m) 22.8
  • Enterprise value (£m) 27.7

Barkby has announced interim results for the period immediately prior to the transformational deal to acquire the Dickson controlled businesses. Looking forward, the board expects Commercial Property Development to continue to trade in line with expectations but the group’s five pubs have now been closed due to COVID-19 and there has been a delay in acquiring The Star Inn at Sparsholt. Workshop Coffee’s retail outlets are also now closed. Government interventions on taxation deferral, payroll subsidies, business rates relief and small retail grants will benefit but FY20 EBITDA is now expected to be £3.5m (our previous forecast £4.5m). We have put our forecasts under review until speaking to management on the detail. To preserve the group’s cash position, the Executive Directors are taking an immediate 40% pay cut and Non-Executive Directors a 100% cut. The directors have considered the group’s cash position in the event of a prolonged disruption to the economy resulting from COVID-19 and are confident that the group can maintain sufficient working capital headroom into the foreseeable future.

Guy Hewett 020 7220 0549 ghewett@finncap.com

Byotrol (BYOT) : Corp

Tristel* agreement and trading update

Key data

  • Share price (p) 3.6
  • Target price (p) 7.0
  • Market cap (£m) 15.4
  • Enterprise value (£m) 13.4

A know-how licence and commercial collaboration with Tristel relating to (i) the joint development of a novel biocidal formulation and (ii) Byotrol’s development of two additional biocidal products and formulations that will be supplied and licensed to Tristel provides another example of how Byotrol is able to monetise its technology. Also, a positive trading update, highlighting the demand for products in light of COVID-19, supports full-year forecasts, which could yet be bettered depending on the ability to fulfil the current £1.7m order book (c.5x normal levels). With additional licensing/monetisation deals yet to come and the prospect of driving additional value for Byotrol24 in the US, we reiterate our target price of 7p.

Mark Brewer 020 7220 0556 mbrewer@finncap.com

Tristel (TSTL) : Corp

Byotrol* supply and licensing agreement

Key data

  • Share price (p) 378.0
  • Target price (p) 375.0
  • Market cap (£m) 168.4
  • Enterprise value (£m) 164.3

Tristel has announced that it has entered into a know-how licence and commercial collaboration with Byotrol relating to (i) the joint development of a novel biocidal formulation and (ii) Byotrol’s development of two additional biocidal products and formulations that will be supplied and licensed to Tristel. The former product will be unique worldwide, combining sporicidal efficacy with residual disinfection efficacy, and offering avenues for incremental growth. The latter products will ensure that Tristel remains compliant with European and future UK directives and are expected to cannibalise existing non-ClO2-based products. Tristel remains at the forefront of the battle against COVID-19 within the hospital setting, which will temporarily expand to accommodate the additional influx of resulting patients, ensuring the need for high-level disinfection. More compelling, perhaps, is the notion that COVID-19 will bring about a sea-change in disinfection practices in many healthcare systems (e.g. China) that will ensure the market endures beyond this. No changes to forecasts at present and we reiterate our target price of 375p.

Mark Brewer 020 7220 0556 mbrewer@finncap.com

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