The businesses are assessing the potential risks caused by the coronavirus pandemic and its impact on economies, industries, societies and financial markets. They are busy implementing control procedures and are conducting risk analysis. Also, as the COVID-19 situation builds further, the businesses have taken appropriate measures to keep their employees and customers safe in accordance with the governmental guidelines, to ensure containment to the spread is attained.
Meanwhile, gradually some confidence is building up in the markets with various governments coming up with measures to fight the pandemic in a more stringent way. In the United Kingdom, despite the lockdown announced by the government, there has been a sense of jubilation, and the FTSE surged by over 9 per cent, the second-best percentage gain after 24 November 2008. The gains were also supported by the rally in US counterparts on reports of the mammoth stimulus package in the offing, to shore up businesses and employees. Meanwhile, the London’s FTSE AIM All-Share index continued its gaining momentum and traded up by 73.26 points or 2.47% at 3.042.84, while writing on 25th March 2020 at GMT 10:30 AM.
In this article, we are going to discuss the financial highlights of three stocks from different sectors listed on the FTSE AIM All-Share index. The stocks include Ergomed Plc from the Biotechnology sector, Frontier IP Group Plc from the Industrial Support Services sector and Applied Graphene Materials Plc from the Chemicals sector. Below is a comparative chart of stock prices of these stocks for last 1-year period.
(Source: Thomson Reuters, Comparative chart of FIPP vs AGM vs ERGO)
Ergomed Plc- Audited full-year results for 2019 (Period ended 31st December 2019)
The company’s order book as at 31st December 2019, was up by 13.6 per cent to £124.1 million as compared to £109.2 million in the prior year. The company’s revenue was up by 26.1 per cent to £68.3 million in 2019 in comparison to £54.1 million in 2018, due to growth in both Pharmacovigilance (PV) and Clinical Research Outsourcing (CRO) divisions. The company’s Gross profit was up by 53 per cent to £29.5 million in 2019 from £19.3 million in 2018. The company’s Adjusted EBITDA was up by 454.6 per cent to £12.5 million in 2019 from £2.3 million in 2018. The company’s Cash and cash equivalents were up by 174.8 per cent to £14.3 million in 2019 in contrast to £5.2 million in 2018. The company recorded a Basic EPS of 12 pence in comparison to a loss per share of 20 pence in 2018.
(Source: Company’s filings, LSE)
Covid-19 and Ergomed Plc
Ergomed Plc is closely observing the rapid developments of an unprecedented global healthcare challenge, COVID-19 outbreak. The company was an integral part of executing a clinical trial at a hospital in Italy, which is second after China in terms of causalities. The company looks forward to contributing in improving outcomes for patients and advancing drug development in the field by bringing its expertise and proven capabilities to the table.
The company has its plans on mitigating financial risks, and they would be implemented if required. However, the group has not seen a material impact on its business till yet. The company got a new £30 million credit facility due to its strong balance sheet and has a resilient business model to counter the risks posed by the novel Coronavirus.
Business overview: Ergomed Plc
Ergomed Plc (LON: ERGO) provides specialist services such as clinical trial planning, management and monitoring services to the pharmaceutical industry, which are used in all phases of clinical trials, post-approval medical information and pharmacovigilance. The Group offers a complete range of top-quality clinical trial management and contract research services. In addition, the company also offers an industry-leading suite of specialist PV (pharmacovigilance) solutions along with an internationally recognised specialist expertise in orphan drug development.
Ergomed Plc -Stock price performance
On 25th March 2020, at the time of writing (before market close, GMT 10:18 AM), Ergomed Plc’s shares were trading at GBX 350, up by 7.03 per cent against its previous day closing price. Stock's 52 weeks High and Low is GBX 478.00 /GBX 165. At the time of writing, the share was trading 112.12% higher than its 52-week low and 26.78% lower than its 52-week High. The beta of the company stood at 0.54, which meant that in comparison with the benchmark index, the stock was low in volatility. The total market capitalisation of the company was recorded at £157.47 million.
Frontier IP Group Plc - Interim results for H1 FY20 (Period ended 31st December 2019)
The company’s fair value of the portfolio was up by 49 per cent to £17,141,000 as at 31st December 2019 from £11,508,000 reported on 31st December 2018.
The company’s Revenue from services, however, was down by 12 per cent to £170,000 in H1 FY20 from £193,000 in H1 FY19 which can be attributed to a lower level of technical services provided during the period.
Due to higher gain on revaluation of investments, the company’s Profit before tax was up by 67 per cent to £2,088,000 in the H1 FY20 from £1,247,000 in H1 FY19. The company’s Unrealised profit on the revaluation of investments was up by 52 per cent to £3,024,000 during the period from £1,983,000 in the prior-year period. The company’s Basic earnings per share increased by 46 per cent to 4.66 pence in H1 FY20 from 3.18 pence in H1 FY19.
The company’s Net assets per share increased to 46.6 pence in H1 FY20 from 38.8 pence in H1 FY19. During the period, the company’s cash balances rose to £4,022,000 in H1 FY20 from £2,528,000 in H1 FY19.
(Source: Company’s filings, LSE)
Covid-19 and Frontier IP Group Plc
The Company has what it takes to survive in these challenges caused by the Coronavirus. The Frontier IP Group has a stake of 17 per cent in the Vaccine group which specialises in its novel animal vaccine technology. The vaccine technology company has subsequently commenced development on vaccines to tackle the novel Coronavirus and its family of coronaviruses for use in the animals from which the pandemic originally emerged to infect humans.
Business overview: Frontier IP Group Plc
Frontier IP Group Plc (LON: FIPP) is a British company focused on commercialisation of intellectual property (IP). The company identifies the strong intellectual property and then develops it by using commercialisation services. The union of science and commerce define Frontier IP. The company partners with relevant industry majors to contribute in the early stages of development to ensure the final product meets the real-world needs and demand. In addition, the company supports its partners in fundraising and collaboration at the early stages of development. The company operates in various sectors including materials, energy, healthcare, information technology and life sciences.
Frontier IP Group-Stock price performance
On 25th March 2020, at the time of writing (before market close, GMT 10:14 AM), Frontier IP Group Plc’s shares were trading at GBX 51, which remained same to its previous day closing price. Stock's 52 weeks High and Low is GBX 88.83 /GBX 44. At the time of writing, the share was trading 15.91% higher than its 52-week low and 42.59% lower than its 52-week High. The beta of the company stood at 0.87, which meant that in comparison with the benchmark index, the stock was low in volatility. The total market capitalisation of the company was recorded at £25.85 million.
Applied Graphene Materials - Interim results for H1 FY20 (Period ended 31st January 2020)
(Source: Company’s filings, LSE)
The company looks forward to delivering shareholder value in the long term. The company’s revenue rose to £35,000 in H1 FY20 from £26,000 in H1 FY19. The company posted robust sales in the month of February 2020. Though, the company recorded a loss before tax of £2.3 million in H1 FY20 in comparison to a loss of £2.4 million in H1 FY19. The company had cash balances of £4.3 million by the end of H1 FY20.
Covid-19 and Applied Graphene Materials Plc
The company continues to operate in a manner to strengthen the safety of its employees and maintain business stability. The customers engagement is being watched by the company in the Covid-19 hit scenario, and it shall continue to work with them to retain growth as situations will allow in the next few months.
Business overview: Applied Graphene Materials Plc
Applied Graphene Materials Plc (LON: AGM) is an AIM-listed company which provides a wide range of applications with custom graphene dispersions and formats. Three main segments which the group focuses, are – coatings, composites and polymers plus functional fluids. The group is capable of high-volume graphene nanoplatelets using a continuous process, and the company owns the know-how and intellectual property behind these processes, giving it a competitive advantage.
Applied Graphene Materials -Stock price performance
On 25th March 2020, at the time of writing (before market close, GMT 10:16 AM), Applied Graphene Materials Plc’s shares were trading at GBX 8.50, which remained flat as compared to previous day’s price. Stock's 52 weeks High and Low is GBX 36 /GBX 7. At the time of writing, the share was trading 21.43% higher than its 52-week low and 76.39% lower than its 52-week High. The beta of the company stood at 0.88, which meant that in comparison with the benchmark index, the stock was low in volatility. The total market capitalisation of the company was recorded at £4.20 million.