Morses Club (MCL) : Corp

New funding negotiated on more appropriate terms

Key data

  • Share price (p) 65.0
  • Target price (p) 160.0
  • Market cap (£m) 84.6
  • Enterprise value (£m) 99.8

The Revolving Credit Facility provides Morses Club with the flexibility to use funding in line with business needs, never more necessary than in today’s environment. The in-built flexibility associated with an RCF has been extended by the company’s successful renegotiation of the amount and term (to November 2021), applied in line with the needs of the business given the environment surrounding COVID-19 and the economic lockdown. The provision of more suitable terms from existing funders is a mark of confidence in the company from those providing it with the debt needed to serve customers in unprecedented circumstances. Staff and agents continue to serve customers without the need for the use of government support schemes, as costs are reduced by measures such as the improved lending terms announced today.

Nik Lysiuk 020 7220 0546

PCI Pal (PCIP) : Corp

New Rapid Remote solution will meet COVID-19 issues

Key data

  • Share price (p) 44.5
  • Target price (p) 55.0
  • Market cap (£m) 18.9
  • Enterprise value (£m) 14.4

The global provider of secure payment solutions has launched a rapid deployment version of its payment services offering, to assist customers during the business continuity challenges caused by the coronavirus pandemic. Rapid Remote delivers secure and compliant payment services from PCI Pal’s globally available AWS cloud environment within 48 hours of ordering, swiftly enabling organisations to continue handling customer payments in a secure and compliant way even when operators are working remotely and from home. At this stage we make no changes to forecasts or target price.

Lorne Daniel 020 7220 0545

Shoe Zone (SHOE) : Corp

Dividend and interim results update

Key data

  • Share price (p) 91.0
  • Target price (p) U/R
  • Market cap (£m) 45.5
  • Enterprise value (£m) 40.

The company has released a statement that confirms that the cancellation of the payment of the 2019 final due to COVID-19 has been approved at a General Meeting. The statement also confirms that its application for a £15.0m loan utilising the Business Interruption scheme has been approved by its primary lender, and additionally provides an interim results update. At this stage, our forecast and target price remain under review.

Mark Paddon 020 7220 0541

Pebble Beach Systems (PEB) : Corp

Strong final results, and initiation of coverage

Key data

  • Share price (p) 9.3
  • Target price (p) U/R
  • Market cap (£m) 11.5
  • Enterprise value (£m) 19.9

Pebble Beach Systems is a leading developer and provider of playout automation and IP-based solutions to over 150 customers across the global broadcast industry. Its portfolio of proprietary software solutions is central to the playout of uninterrupted broadcast, for both live and pre-recorded content, and importantly enables broadcasters to automate and streamline multi-channel playout. Via its cloud-based solutions, the company also supports broadcasters and operators as they transition from traditional hardware-based infrastructure to IP-based systems, for a more flexible playout environment. As the industry enters a pivotal decade for the transition to IP, Pebble Beach Systems is well positioned to benefit from the increased traction across the market. FY19 results show adjusted PBT growth of 89%, EBITDA growth (LFL, pre IFRS16) of 47% and revenue growth of 22%, with net debt continuing its descent, now down to £8.4m (FY18: £9.4m). While COVID-19 introduces uncertainty over growth, and we do not yet offer forecasts, the group’s existing customer base is benefiting from Pebble Beach’s automation and remote support as end-user demand for TV booms. We look forward to the post crisis environment to establish forecasts and map the continuation of the evident momentum demonstrated in FY19.

Hayley Palmer 020 3772 4681

Flowtech Fluidpower (FLO) : Corp

Full-year results in line; further debt reductions expected

Key data

  • Share price (p) 81.9
  • Target price (p) U/R
  • Market cap (£m) 50.1
  • Enterprise value (£m) 75.1

Full-year results were in line with reduced guidance. The effects of a difficult H2 market backdrop are evident with management implementing efficiency improvements and operating cash flow gains before the onset of COVID-19. Management has implemented further cost-saving and cash-shielding actions and expect a further reduction in net debt this year. Due to near-term pandemic disruption and uncertainties, forecasts remain under review.

David Buxton 020 7220 0542

Synairgen (SNG) : Corp

COVID-19 trial (SG016) update

Key data

  • Share price (p) 52.5
  • Target price (p) 120.0
  • Market cap (£m) 78.5
  • Enterprise value (£m) 76.0

Synairgen announced that more than 75 out of the targeted 100 hospitalised COVID-19 patients have been dosed with SNG001. Additionally, an amendment to Synairgen’s Phase II study (SG016) of SNG001 (inhaled interferon – IFNβ-1a) was granted and listed on the NHS Research Authority website on 29 April. The amendment will allow the study to start enrolling patients with SARS-CoV-2 in the home setting, within 72 hours of symptoms first developing. The aim is to be able to treat COVID-19 patients earlier in their infection given that hospitalised patients, included in the 100-patient part of SG016, will typically have had COVID-19 symptoms for an average of 10-11 days prior to admission. This forms part of the broader clinical activities planned for SNG001 and described at the time of the recent placing. We still expect first data readout from hospitalised patients by June 2020. We reiterate our 120p target price with the prospect that this could rise by up to 240p on a positive outcome of first data readout.

Mark Brewer 020 7220 0556

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