Market ReportMarket Movers

Techfinancials surges on blockchain hopes despite patchy trading update

A look at the day's major movers, including Big Sofa Technologies, Techfinancials, Paragon Entertainment, Pendragon, Metro Bank, Serco, Taptica, HemoGenyx Pharmaceuticals ...

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Techfinancials' blockchain trading technology revenues surged to US$3.8mln from US$0.2mln last time

Techfinancials Inc (LON:TECH), the fintech software hopeful with a new focus on blockchain-related technologies, was up around 150% at one point on Wednesday afternoon at a 12-month high of 12.84p – despite a total lack of news.

But then the Israeli company put out an afternoon trading statement that was patchy at best, revealing that trading in its historical business “remains challenging”, that it has decided to entirely reverse the US$9.5mln gain of its investment in CEDEX blockchain-based exchange “due to the volatility in the cryptocurrency market in the subsequent months” and recognise an impairment of its investment in 51% owned consumer-facing trading platform Dragonfinancials.  Revenues are also likely to be down 43% to US$7.6mln and cash was down to US$1.1mln, it said.

But on the upside, blockchain trading technology revenues surged to US$3.8mln from US$0.2mln last time and Techfinancials said it “remains optimistic” about prospects for both CEDEX and Footies, a new company that has been established to develop a blockchain ticketing venture for sports venues and teams, “and looks forward to making further announcements as these businesses develop”.

Even after this decidedly mixed update, Techfinancials shares were still up 80% at 9.2p.

Another tech outfit rallying on Wednesday afternoon trading was Taptica International Ltd (LON:TAP), which was revved up after providing some more background details on the lawsuit filed by Uber Technologies Inc. (NYSE:UBER) a day earlier.

As well as saying that it is considering a further share buy-back programme, the AIM-listed brand advertising and marketing group said that the Uber case related to its 2014 contract, alongside number of other adtech vendors, with Fetch Media to promote Uber's mobile app. The company said there was no direct engagement between it or any of its subsidiaries and Uber.

Taptica shares were up 20% to 99.25p, erasing some but not all of the prior day's fall from 130p.

12.50pm: Metro Bank lifted by upgrade

Metro Bank PLC (LON:MTRO), recently wallowing at all-time lows, was lifted 2% to 612.5p by an upgrade from Macquarie to ‘neutral’ from their previous ‘underperform’ rating on the back of the challenger’s recent £375mln equity raise.

Serco Group PLC (LON:SRP) had earlier risen 2% to almost 137p, just below a 52-week high, thanks to a positive write-up from Peel Hunt, which also dished out an upgrade to Domino’s Pizza Group PLC (LON:DOM).

Analysts moved Serco to ‘add’ from ‘hold’ on the back of a “strategically attractive” acquisition of a US naval engineering business announced last month, while Domino scooted up 1% to 239.8p as it was upped to ‘buy’ from ‘add’ after Peel Hunt made a visit to the company’s Warrington supply chain centre that “highlighted strengths and opportunities as well as a shifting strategy that reminded us of DOM’s golden era”.

A loser on the day was Auto Trader Group PLC (LON:AUTO), which was shifted down to ‘sell’ from ‘neutral’ by UBS, which saw risk/reward “skewed negatively with limited potential upside”.

11.20am: A Paragon of auditing virtues

Paragon Entertainment Ltd (LON:PEL) shares were down 13% to 1.4p by late morning on Wednesday after the tourist attractions and exhibitions designer issued a profit warning.   

AIM-listed Paragon, whose work has included the design and build of the Titanic Belfast exhibition and the Saatchi Gallery’s Rolling Stones Exhibitionism show, said some revenue and profits it had associated previously expected to recognise in the 2018 financial year will have be pushed back into 2019 due to new accounting rules.

Mainly relates to a shift in the programme and therefore revenue recognition for the company's work producing ‘Kidzania’ in Abu Dhabi, directors now expect a £3mln loss before tax compared to guidance for £2.5mln-£2.7mln.

Sharing most of the same letters of Paragon's name and news of its own profit warning, Pendragon PLC (LON:PDG) blamed a challenging market as well as internal operational difficulties.

The car dealership chain said it expected to be “significantly loss making” in its first half, due to significant increase in used car stock at the end of the prior year and higher costs, before returning to profitability in the second to record a “small” pre-tax loss for the full year.

Pendragon shares were down 23% to 17.73p.

9.35am: Big Sofa comfortably higher

Shares in Big Sofa Technologies Group PLC (LON:BST) were comfortably higher in early trade on Wednesday, up 15% to 4.7p as the video analytics provider said it expected half-year sales and profit would be plumper than last time.

As the company’s six months to end-June has been stuffed full of work, including with market research giant Ipsos and customers in a diverse range of sectors around the globe, the AIM-listed outfit guided to revenues up 80% to around £1.1mln.

As well as reporting a “material” reduction in costs compared to last year, Big Sofa said it expects revenues to grow “significantly” in the second half of its financial year.

Elsewhere, HemoGenyx Pharmaceuticals PLC (LON:HEMO) jumped 13% to 2.94p as it trumpeted success in pre-clinical trials for its CDX antibody’s effectiveness as a conditioning therapy in bone marrow transplants.

Looking to replace current transplant conditioning processes, which use chemotherapy and are thought to reduce the number of people eligible, the new trial data showed CDX helps the human body’s own defences to target the cancerous cells.

Another early riser was IQ-AI Ltd (LON:IQAI) as the medical software and services group revealed that its Imaging Biometrics arm has signed a non-exclusive business development and sales deal with brain analysis firm CorTechs Labs.

The agreement will provide its products with “extended and immediate” sales representation in the US and other international markets, while CorTech would add Imaging Biometrics’ software and algorithms to its portfolio.

IQ-AI shares were up 14% in early trade to 1.39p.

Proactive news headlines:

Taptica International Ltd (LON:TAP) rallied on Wednesday after it provided background on the lawsuit filed by Uber Technologies Inc. (NYSE:UBER), announced on Tuesday, and said it is considering a further share buy-back programme.

HemoGenyx Pharmaceuticals PLC (LON:HEMO) says pre-clinical trials in animals indicate its CDX antibody is effective as a conditioning therapy in bone marrow transplants. Conditioning is a pre-requisite for a transplant but it is extremely toxic and has severe side effects, which reduces the number of people eligible.

IronRidge Resources Ltd (LON:IRR) has confirmed the completion of its acquisition of the Vavoua Projects, giving the company a highly prospective gold exploration portfolio in Cote d'Ivoire. The acquired assets - 100% of the share capital of Marlin Minerals, Booster Minerals and CAPRI Metals - are located in the vicinity of the Abujar project which hosts 1.73mln ounces.

Internet hardware specialist Ethernity Networks PLC (LON:HZM) expects to start generating cash from 2020 as momentum builds for its new generation of modules. Ethernity’s technology helps servers run much faster through the efficient 'offloading' and rerouting of internet traffic.

Sirius Minerals PLC (LON:SXX) has unveiled a new supply deal with a customer in India, further boosting its contracted sales ahead of its mine start-up. The deal, described as a ‘major take or pay’ agreement, sees Indian Farmers Fertilisers Cooperative Limited (IFFCO) take significant volumes of the POLY4 fertiliser product over an eleven year term.

IQ-AI Limited’s (LON:IQAI) subsidiary, Imaging Biometrics (IB), has signed a non-exclusive business development and sales deal with brain analysis firm CorTechs Labs.

StatPro Group PLC (LON:SOG) has strengthened its index and benchmarks offering in the growing area of environmental, social and governance (ESG) with a €2.9mln (£2.6mln) acquisition on Wednesday.

Secure payment products and customer contact solutions, Eckoh PLC (LON:ECK), reported a 7% increase in annual profit after record levels of new business and contract renewals lifted revenue.

Live Company Group Plc (LON:LVCG) has signed a touring agreement with the UK arm of children’s television network Nickelodeon.

Galileo Resources PLC (LON:GLR) said that its 34%-owned Glenover rare earths project was “well placed to benefit” as prices of the minerals are boosted by the standoff between China and the US.

Landore Resources Ltd (LON:LND) has kicked off a drill programme for the BAM gold deposit, at the Junior Lake property in Ontario, Canada. The company will drill a total of 4,500 metres to infill and extend the deposit’s current 951,000 ounce resource.

Keywords Studios PLC (LON:KWS) has acquired Vancouver-based audio description provider Descriptive Video Works Inc (DVW) from its founder Diane Johnson for around £1.9mln (C$3.2mln).

Eden Research PLC (LON:EDEN) unveiled the key appointment of Rob Cannings to a new role of Commercial Director for the biopesticide products company with immediate effect. Most recently, it pointed out, Cannings served as Commercial Director at Plant Health Care with responsibility for Europe, the Middle East, Africa and Asia.

Corero Network Security PLC (LON:CNS) has appointed tech industry veteran Michael Connolly as its US-based Vice President Worldwide Sales. The group pointed out that Connolly has over 25 years' experience in the technology industry with significant expertise in leading global sales functions.

Galantas Gold Corporation (LON:GAL) (TSX-V:GAL) has announces the death of its non-executive chairman, Lionel John (Jack) Gunter. It noted that Gunter led the discovery of the Omagh gold deposits in Northern Ireland, currently in development by the company, and although not actively engaged in management for many years, said his guidance and support as a director and chairman was much appreciated by his colleagues. The company added that its board will appoint a new chairman in due course.

Amphion Innovations PLC (LON:AMP) reassured investors on Wednesday that it was working closely with its debt provider to find a resolution to the terms of its loan. Big Pic in March.

Avacta Group PLC (LON: AVCT), the developer of Affimer biotherapeutics and reagents, announced that its chief scientific officer, Dr Amrik Basran, will be presenting at the Next Generation Protein Therapeutics & Bioconjugates conference in San Francisco, California on 19 June 2019. It said Dr Basran's presentation, 'Affimer Therapeutics: A Novel Human Scaffold for the Generation of Bi-specific Molecules', will give an overview of the benefits of using Affimer technology to generate bispecific drug molecules.

MaxCyte Inc. (LON:MXCT), the global clinical-stage, cell-based therapies and life sciences company, announced the appointment of Numis Securities as its joint corporate broker with immediate effect. It said Panmure Gordon will continue to act as the company's nominated adviser and joint corporate broker.

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