Interim Management Statement Q1 2024 - Seite 3

Surface Transforms (-60.2%, -0.48 pence per share) warned that its production ramp was being constrained by production line issues. Whilst it was confident that bringing in new equipment to address single points of failure and changes to maintenance schedules would address the issues, revenue growth would fall short of expectations. The company is guiding to very substantial revenue growth in FY24 as production ramps.

C4X Discovery (-52.2%, -0.28 pence per share) issued results for the year to July 2023. The company benefits from a strong funding position following the receipt post period end of £16m for the sale of its Orexin-1 program to Indivior and $11m following the completion of a pre-clinical milestone on its NRF2 Activator programme (oral therapy for the treatment of inflammatory and respiratory diseases), now under development by AstraZeneca following a license agreement signed in November 2022.

Equipmake (-11.1%, -0.25 pence per share) reported results for the year to May 2023 with revenues growing by 38% to £5.1m. Post period, the company published its results for the 6 months to November 2023. Although the company has been successful in winning new contracts, revenue guidance for the year to May 2024 was reduced to a more manageable level. The company has appointed a new and very experienced COO to support its expansion as it looks to open up new markets.

Non-Qualifying Investments

On the Beach’s (+65.2%, +0.11 pence per share) full year results to September 2023 highlighted a period of much improved trading, benefitting from strong growth in long-haul and premium. Profits were also ahead of expectations due to lower marketing spend. Strong cash generation coupled with the £75.8m of cash on the balance sheet (ex. customer deposits) allowed the company to reinstate its dividend.

Hollywood Bowl (+23.6%, +0.10 pence per share) results for the year to September 2023 confirmed another year of robust trading. The company has a strong balance sheet, which supports the dividend (4.2% yield) and a £10m share buy-back.

Chemring (+26.3%, +0.10 pence per share) continues to benefit from very strong demand across the global defence market, with FY23 revenues increasing by 18% to £473m and a record order book. Underlying profits grew 16% to £69m.

Shortly after providing a robust outlook alongside the release of its results for the 6 months to June 2023, XP Power (-42.5%, -0.08 pence per share) surprised the market with a significant downward revision to its guidance for FY23, citing softer semiconductor demand and customer deferrals. The weaker financial performance threatened a breach of the company’s debt covenants which was addressed by a fundraise, cost cuts and the suspension of the company’s dividend policy. A subsequent update confirmed the company has traded in line with its revised outlook.