Analyzing Results Of Two AIM Stocks; Remote Monitored Systems Plc & Fox Marble Holdings Plc

Remote Monitored Systems Plc

Remote Monitored Systems Plc (RMS) is a United Kingdom domiciled holding company that provides high technology services to its clients. The company through its subsidiaries Geocurve and GyroMetric Systems provides survey and inspections, security, data management, and analytics services to its clients.

The company’s subsidiary Geocurve provides geographical surveying services to its clients while putting both traditional survey methods into deployment along with modern day technologies which include among others UAS/UAV, GIS databases, 3D modelling, laser and Lidar scanning and hydrographic modelling. The employment of such modern technologies helps it derive high efficiency data capture, heightened safety in operations and with the additional benefit of high cost savings, across private, military and civil sectors.

The company’s subsidiary GyroMetric Systems are innovators of a revolutionary new method of assimilation and analysis of digital information collected from rotating shaft in order to produce the most detailed estimation of a possible mechanical failure. This methodology has set a new standard in this engineering field for protection of rotating machinery which may be employed on any rotating shaft starting from a bench tool spindle to a cruise liner propeller shaft.

The company’s shares are listed on the AIM segment of the London Stock Exchange where they trade with the ticker name RMS.

Results Update

The Company on 27 September 2019 came out with its financial results for the six-month period ended 30 June 2019.

  • There was a 43 per cent decrease in revenue of the company for the six-month period to stand at £261,854 (For H1 2018 restated revenue value was £460,330). This decrease in revenue is the results of a weaker than envisaged beginning made by Geocurve Limited (“Geocurve”) to 2019 because of the remedial work that was needed on the TEAM2100 Project.
  • There was a 15 per cent increase in the cost of sales of the company for the six-month period to stand at £295,764 (For H1 2018 the cost of sales stood at £256,325). This was due to the incremental manpower requirement provisioning on the TEAM2100 Project during the first six-month period; this incremental manpower provisioning was wound up during the second half of the year.
  • There was a 19 per cent increase in administrative expenses of the company for the six-month period to stand at £540,746 (for H1 2018 period the administrative expenses of the company stood at £454,220); the increase in administrative expenses can in most parts be attributed to the increase in operating costs of GyroMetric Systems Limited (“GyroMetric”).
  • The cash balances of the company at the end of the six-month period stood at £17,707 (whereas at the end of H12018 the Cash balances of the company stood at £109,381). Additional £100,000 were raised after balance sheet period through Convertible Loan Notes

Source – Company’s half-yearly results statement published on 27 September 2019

Stock performance at the London Stock Exchange

Price Chart as on 30 September 2019, before the market close (Source: Thomson Reuters)

On 30 September 2019, at the time of writing the report (before the market close, GMT 9.49 AM), RMS shares were trading on the London Stock Exchange at GBX 0.580.

The stock has a 52-week High of GBX 1.44 and a 52-week low of GBX 0.45. The total market capitalization of the company was £2.34 million.

Outlook

The company’s subsidiary, Geocurve Limited, during the six months of 2019, experienced a weaker than anticipated beginning to 2019 and this was mostly on account of the need to allocate higher amount of resources to the Environment Agency’s Thames Estuary Asset Management 2100 (TEAM2100) programme. The allocation of such a high amount of resources to accomplish this task had an adverse effct on Geocurve’s ability to take up further assignments, which resulted in a 43 per cent fall in the company’s revenues to £261,854 during the first six-month period of 2019.

The company during the year acquired an initial 36.9 per cent interest in GyroMetric in April 2018 and later on hiked it to 57.8 per cent in September 2018. GyroMetric is gaining footprint into newer markets and continues to find new applications for its unique technology, some of which have, only in the recent past, become apparent. The potential uses of GyroMetric’s remote monitoring technology have already surpassed what was anticipated and will continue to be a value creator for the company.

Although the problems with Geocurve during the first half were un-encouraging, the company took timely and apt actions to resolve these; with the problems with the TEAM2100 programme resolved, costs reduced and Geocurve was back in the black by June. GyroMetric, whilst still looking for significant opportunities in the wind sector, has made good headways in identifying new clientele in the industrial sectors with shorter lead times, while simultaneously delivering new orders for the marine market.

 

Fox Marble Holdings Plc

Fox Marble Holdings Plc (FOX) is a United Kingdom domiciled marble mining and trading company. The company has quarrying interests in Republic of Kosovo and Republic of Macedonia from where it procures raw marbles stones and produces finished, dimensional stones for markets in Europe, and the Middle East.

The company’s facility for cutting and processing of blocks into polished slabs and tiles is located in Lipjan near Pristina airport in Kosovo. The facility is a 5,400 square feet facility erected on a 10 Hectare site in 2013.

The company’s quarries are in Prilep in Macedonia, and Cervenillë, Syriganë and Malishevë quarries in Kosovo. Together these for quarries produce a total of nine varieties of marble stone (excluding the Bianco Glaciale) form part of the company’s portfolio of Collections.

The company’s shares are listed on the AIM segment of the London Stock Exchange where they trade with the ticker name FOX.

Results Update

The Company on 30 September 2019 came out with its financial results for the six-month period ended 30 June 2019.

  • The Revenue of the company from the marketing of its marble products during the half-yearly period ending on 30 June 2019 rose by 63 per cent to stand at €1.0 million (During the H1 2018 period the revenues of the company were €615,000) This was aided by a growth in the sales of block material from the Prilep quarry in Macedonia.  The Sale of the Alexandrian White and Alexandria Blue blocks rose to €0.6 million from €0.2 million during the same period in 2018, to a number of block wholesale dealers across continental Europe and across other markets.
  • The Production of marble during the six months period ending 30 June 2019 rose by 74 per cent to be at 9,529 tonnes from 5,473 tonnes in 2018.  This high growth in the production over this period is on account of incremental investments being made in the mining of these stones.
  • The Operating loss of the company for the six months period ended 30 June 2019 stood at €0.7 million (whereas the operating loss for the six months period ending 30 June 2018 stood at €1.0 million).
  • The Loss of the company for the six months period ending 30 June 2019 stood at €0.8 million (whereas for six months period ending on 30 June 2018 the loss of the company stood at €0.8 million).
  • The Cash balance of the company at the end of the six-month period on 30 June 2019 stood at €0.7 million (while on 31 December 2018 it stood at €0.4 million).  Cash balance after the balance sheet date period on 26 September 2019 stood at €0.6 million.

Source – Company’s half-yearly results statement published on 30 September 2019

The stock has a 52-week High of GBX 9.80 and a 52-week low of GBX 3.70. The total market capitalization of the company was £9.27 million.

Outlook

There was heightened activity in the company during the first half of the year 2019 with a high growth in sales of its products compared to the first half year period of 2018 with special focus on white marble from the quarry in Macedonia that has seen sustainable revenues with an increase in production .

“The adverse effect of the halt of quarrying at the M3 quarry in Kosovo is being compensated by the increased amount of sales of processed marble finished products from the company’s factory in Kosovo. The company is able to envision an expansion in the pipeline of sales across the world and heightened demand for its marble products for projects in places like Cyprus, Dubai and also in the home geography of the Balkans.  The company hopes that there will be a growth in quantity of finished products from its factory during the second half of this year.