How are these two AIM stocks performing: LiDCO Group Plc and TomCo Energy Plc?

Summary

  • LiDCO Group Plc witnessed sales growth of 75% year-on-year during H1 FY21.
  • The Company is getting acquired by Masimo Corporation.
  • TomCo Energy Plc's POSP is expected to be operational by November 2020.
  • The estimated capital cost for a 10,000 bopd plant is US$185 million.

LiDCO Group Plc (LON: LID) and TomCo Energy Plc (LON: TOM) are LSE listed stocks in the healthcare industry and energy industry, respectively. Shares of LID were down by 0.94%, and shares of TOM were up by 4.89%, respectively, from the last closing price (as on 3 November 2020, before the market close at 1:25 PM GMT).

Is LiDCO Group Plc's performance driven by Covid-19 pandemic?

LiDCO Group Plc is the FTSE AIM All-Share listed supplier of non-invasive and slightly invasive hemodynamic monitoring equipment to hospitals targeting high-risk surgical patients. The primary markets are the United Kingdom, USA, China and Japan.

(Source: Company website)

Recent Developments

  • On 2 November 2020, the Company announced that it would be acquired by "Masimo LHC Limited", a subsidiary of Masimo Corporation, for the total issued share capital of £31.1 million through a cash offer. The market capitalization of Masimo Corporation is £12 billion. LiDCO shareholders will receive 12 pence per share which is, 77.8% premium from the closing price per LiDCO share of 6.75 pence on 30 October 2020 (last business day before the offer) and 0% premium from the average closing price of LiDCO share of 6.42 pence in the twelve months to 30October 2020. The Board has shown belief in the strategic decision to implement LiDCO as an independent company recognizing the potential to generate maximum value for the LiDCO shareholders.
  • The first closing date of the offer is 23 November 2020.

H1 FY21 results (ended 31 July 2020) as reported on 13 October 2020

In H1 FY21, the Group's revenue increased by 75% year-on-year to £6.16 million from £3.51 million in H1 FY20 on account of a spike in demand due to Covid-19 pandemic. Profit after tax (PAT) during H1 FY21 was £1.36 million. The Company has a strong balance sheet reflecting cash balance on 31 July 2020 of £3.1 million, while it was £1.4 million on 31 January 2020. The Company does not have any external borrowings.

On the operational front, The Company has sold 230 monitors in H1 FY21 compared to 111 in H1 FY20. Regulatory approval was received for the sale of the latest monitor in Brazil and Columbia. The Global installed base of HUP monitors has increased by 14% from 286 on 31 January 2020 to 327 on 31 July 2020.

(Source: Company presentation)

Share Price Performance Analysis of LiDCO Group Plc

(Source: Refinitiv, chart created by Kalkine group)

Shares of LiDCO Group Plc were trading at GBX 11.64 and were down by 0.94% against the previous closing price (as on 3 November 2020, before the market close at 1:25 PM GMT). LID's 52-week High and Low were GBX 12.00 and GBX 3.50, respectively. LiDCO Group Plc had a market capitalization of around £16.48 million.

Business Outlook

The Company has witnessed huge demand for advanced hemodynamic monitors due to Covid-19 pandemic in the UK. However, this unprecedented situation has also resulted in the postponement of elective surgeries as healthcare institutions are prioritizing their efforts to deal with covid-19. The Company is quite optimistic regarding its future prospects and well-placed to grow sales at pre-pandemic levels when the market situation turns normal. The Company is all set to be acquired by Masimo Corporation.

Will TomCo Energy Plc's Greenfield venture become successful?

TomCo Energy Plc is the FTSE AIM All-Share listed company. It is the US operating oil development group making use of technology to unlock hydrocarbon resources. The Company uses radiofrequency technology for the extraction of oil and gas from oil shale.

Recent Developments

  • On 2 November 2020, the Company announced the appointment of Robert Kirchner and Richard Horsman as Non-Executive Directors of the Company. Stephen West has stepped down as Non-Executive Chairman from the Board.
  • On 24 September 2020, the Company provided an update on the Greenfield Energy LLC, the proposed 50:50 joint venture between the Company and Valkor LLC to adapt Petroteq's oil sands plant (POSP) at Asphalt Ridge. The Company confirmed that the progress is underway and restart of the plant is now planned for November 2020.
  • On 16 September 2020, the Company has provided an update on Greenfield Pre-FEED report, which has been authorized by Valkor subsidiary Crosstrails Engineering. The report encapsulates details of technical feasibility of a 10,000 barrel oil per day ("bopd") oil sands plant in Eastern Utah. It also covers an estimation of capital and operating costs. The report has provided the estimates of a capital cost of the 10,000 bopd Plant to be around US$185 million inclusive of all project management and engineering, all equipment and systems, site construction, start-up, and commissioning cost. As per the report, the total cost of production including all expenses required to extract oil ore from the earth and convert into the commercial petroleum product is estimated to be below US$30 per barrel of oil having a target of less than US$25/bbl in the next round of design.

H1 FY20 results (ended 31 March 2020) as reported on 30 June 2020

The Company has not reported any revenue for H1 FY20. However, the operating loss of the Company has slightly improved, and it was £376,000 during H1 FY20 ended on 31 March 2020. The Company is having a sufficient cash balance of £340,000 as on 29 June 2020 to fund expenses related to upgradation of POSP.

(Source: Company Presentation)

Share Price Performance Analysis of TomCo Energy Plc

(Source: Refinitiv, chart created by Kalkine group)

Shares of TomCo Energy Plc were trading at GBX 0.70 and were up by close to 4.89% against the previous closing price (as on 03 November 2020, before the market close at 1:25 PM GMT). TOM's 52-week High and Low were GBX 2.30 and GBX 0.31, respectively. TomCo Energy Plc had a market capitalization of around £3.54 million.

Business Outlook

The Joint Venture with Valkor will give a significant boost to the Company's business providing commercial operation of POSP, which, is expected to restart by the end of November 2020. The technical feasibility study has been conducted and, the Company believes that the pre-FEED report has given high confidence in Greenfield Venture. The report indicated that the proposed commercial scale of oil sands plant is feasible.

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