Snapshot Of Two FTSE stocks – XSG and ALM

  • Sep 19, 2019 BST
  • Team Kalkine
Snapshot Of Two FTSE stocks – XSG and ALM
Xeros Technology Group Plc

Xeros Technology Group (LSE: XSG) is a United Kingdom based company that is involved in the development and trading of polymer bead systems with multiple potential industrial applications. Because of an extensive research and development process over the years, the company has developed a revolutionary way that significantly cuts down water consumption by up to 80 per cent in laundry cleaning, leather tanning and textile garment manufacture, industries and processes that generally require a significant amount of water consumption.

Xeros has over fifty patents and patent applications which cover countries totalling around 90 per cent of the world’s GDP. The company has two service segments which are Xeros Sbeadycare and Xeros Sbeadycare XTEND. Xeros Sbeadycare is a laundry management service that is a solution for multiple laundry applications across the industry, engaging with services like industrial, hospitality, commercial, dry cleaners, workwear, and even athletics clubs and spas. The company’s Research and Development has also resulted in the evolution of three industry-specific technologies, which are: XOrbs™ – Dirt and stain removing polymers that work exceptionally efficiently to achieve better results in laundry by reducing cost and water consumption, XDrum™ - A system that allows conventional washing machines for the usage of XOrb technology and is also used in Fabric and Garment manufacturing applications, XFiltra™ – A small filter feeder that allows tiny plastic microfibres to be filtered out in the laundry load delivering a system that also works in reducing the plastic pollution coming out of such technical processes.

XSG Financial Performance (Interim Results for the six months ended 30 June 2019)

On 19 September 2019, the company announced its interim results for the half-year ended 30 June 2019. The company reported the group revenue at £1.59 million in H1 2019, which was 14.5 per cent year on year below the group revenue in H1 2018 at £1.86 million. The group added another revenue stream in the year, of direct XDrum licensing, derived from the payment of technology fees, reported at £76,000. Machine Sale income at £393,000 in H1 2019, showed a decline of 40.2 per cent year on year. This decline was due to the company's strategy of exiting the direct sales of commercial machines ahead of licensee selling XDrum commercial machine. The company reported a reduction in the Adjusted Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) loss to £8.09 million in H1 2019, a 30.07 per cent from 11.57 million in H1 2018. This was again, a result of the group's migration towards a licensing business model. The group also reported an operating loss of £9.06 million, down 30.6 per cent year on year from H1 2018 operating loss of £13.04 million due to the reduction in losses. In the six months ended 30 June 2019, the company reported net cash outflow from operations falling to £9.21 million, a reduction of 28.3 per cent year on year, from £12.84 million reported for the six months ended 30 June 2018. The company reported a cash balance of £6.45 million as on 30 June 2019 and at £5.25 million as on 31 July 2019. The company had no debt on its books as of 30 June 2019.

The company has previously announced that it would be raising further equity funding between £5-£10 million in 2019 to stay in line with the primary objective of achieving break-even. The company is also expected to cut down on cash outflows because of its exit from the direct sales business model toward the license business model.

XSG Share Performance

On 19th September 2019, at 08:45 AM GMT, while writing, XSG traded at GBX 6.41 per share; a decline of 6.56 per cent or GBX 0.45 in comparison with the previous day’s closing price at GBX 6.86 per share. While writing, Xeros Technology Group Plc traded 28.20 per cent above its 52-week low price of GBX 5.00, set on April 1, 2019. The company’s Market Capitalisation was around GBP 17.63 million.

52,060 stocks of the company have been traded by the time of writing. The average volume of trading per day for last one year has been 379,800 shares. The stock has plunged by 83.79 per cent in the previous one year from the price of GBX 39.56 per share, while trading 89.73 per cent below its 52-week high price of 62.43 set on September 21, 2018.

The beta of the stock was at 1.3174, showing that the share price movement is more volatile compared to the benchmark market index.

Allied Minds Plc

Allied Minds Plc (LSE: ALM) is an IP commercialisation company based in Boston. Having access to the United States government labs, as well as partnerships with leading U.S. corporations. The company establishes, funds, and operates a group of companies with the goal of delivering sustainable cash flow which will, in turn, yield long-term returns for its investors. ALM helps its subsidiaries with capital and resources in monetary as well as physical terms and expertise. The company’s current portfolio includes twelve companies in the Technology and Life Sciences segment while two are platform-based companies: Allied Minds Federal Innovations – Investments based on technology based on federal funded laboratories, and Foreland Technologies – Investments in cyber security subsidiaries. The group's top portfolio companies are Federated Wireless, Spin Transfer Technologies, SciFluor Life Sciences, Precision Biopsy, HawkEye 360 and BridgeSat.

ALM latest news

On 4th September 2019, the company announced that one of its portfolio company, Federated Wireless, which is a leading company in Citizen Band Radio Service (CBRS) secured a US $51 million in series C financing. Some of the Investors in the Series C were new, namely: SBA Communications and Pennant Investors along with existing investors such as GIC, Singapore's sovereign wealth fund, American Tower and Allied Minds also participating. The proceeds would be used to enable Federated Wireless to speed up the availability and adoption of a shared spectrum of CBRS services.

Federated Wireless has 25 companies, across the Telecommunications, hospitality, education, retail, etc. sectors as its customers of which some are looking to augment next-generation wireless services.

Allied Minds invested $10 million in the round, and its ownership of issued share capital is 42.6 per cent, and fully‐diluted ownership is 35.8 per cent post-transaction.

On 17th September 2019, the company reported that the Federal Communications Commission, which is a US regulator for wire, satellite, cable and television, has permitted a preliminary commercial deployment (ICD) of ALM’s portfolio company Federated wireless’ Citizen Band Radio Service (CBRS). Federated Wireless has been working to speed up the availability of high-speed, low-cost wireless network access to mobile data, through the CBRS market, which is in a state of rapid and dynamic growth. Hence the announcement will give a significant boost to the development of the business of wireless, which would in turn work towards improving ALM's performance.

ALM Financial Performance (Results for the year ended 31 December 2018)

The company announced its annual results for the year ended 31 December 2018 on 26 April 2019. The company reported a revenue of US $5.6 million in 2018, a year on year increase of 12 per cent, from US $5.0 million in 2017, which was mainly driven by Non-recurring engineering and service contracts. As on December 31, 2018, the company reported a Net Cash and investments balance at US $97.7 million which included funds in the form of fixed income securities as well. The company reported a profit after tax (PAT) of US $47.3 million, compared to previous year’s Net Loss of US $111.1 million.

In an announcement made on 27th August 2017, the company said that they would present their half-year results on 26th September 2019.

ALM Share Performance

On 19th September 2019, at 09:32 AM GMT, while writing, ALM traded at GBX 60.60 per share; a decline of 2.73 per cent or GBX 1.70 per share in comparison with the previous day’s closing price at GBX 62.30 per share. While writing, Allied Minds Plc traded 65.71 per cent above its 52-week low price of GBX 36.57, set on November 28, 2018. The company’s Market Capitalisation was around GBP 150.34 million.

7,590 stocks of the company have been traded by the time of writing. The average volume of trading per day for last one year has been 277,230 shares. The stock has plunged by 15.24 per cent in the previous one year from the price of GBX 71.5 per share, while trading 31.8 per cent below its 52-week high price of 88.86 set on May 22, 2019.

The beta of the stock was at 1.6965, showing that the share price movement is more volatile compared to the benchmark market index.

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