Good morning - and welcome to the final month of 2025!
Today's agenda is now complete.
Spreadsheet accompanying this report: link (last updated to: 10th November).
Companies Reporting
Melrose Industries (LON:MRO) (£7.5bn | SR58) | CFO Matthew Gregory intends to retire and will step down in 2026. Ross McCluskey has been appointed as successor and will join the company in May 2026. McCluskey is currently at Intertek Group. | ||
easyJet (LON:EZJ) (£3.8bn | SR54) | easyJet completed the required software updates on its aircraft over the weekend with no disruption to its flying programme. Outlook remains in line with exps. | ||
Serco (LON:SRP) (£2.6bn | SR90) | 12yr contract worth c.£500m to manage HMP Dovegate. Serco has operated Dovegate since 2001. New contract will include service enhancements. | ||
| Greatland Resources (LON:GGP) (£2.5bn | SR79) | Havieron Project - Feasibility Study | Confirms pathway to “world class” gold-copper mine. Update ore reserve of 38.5Mt at 2.63g/t Au. $1bn pre-production capex to be funded from existing $750m cash and other resources. | |
Plus500 (LON:PLUS) (£2.2bn | SR93) | PLUS is appointed as clearing partner for the new event-based contracts platform, FanDuel Prediction Markets. | ||
HICL Infrastructure (LON:HICL) (£2.2bn | SR78) | HICL withdraws from combination with TRIG. HICL board remains convinced of rationale, but lacks sufficient support from HICL shareholders. | PINK | |
Renewables Infrastructure (LON:TRIG) (£1.78bn | SR82) | HICL is withdrawing from the proposed combination with TRIG announced on 17 November 2025. TRIG’s standalone strategy remains unchanged, as per recent CMD. | PINK (AMBER=) (Roland - I hold) | |
Wizz Air Holdings (LON:WIZZ) (£1.21bn | SR40) | Wizz identified 83 Airbus A320 aircraft requiring software updates. These have now all been updated, with zero flight cancellations. | ||
SolGold (LON:SOLG) (£887m | SR33) | Jiangxi Copper Company made two possible cash offers for SolGold on 23 and 28 Nov. The latest was for an acquisition at 26p per share. Both offers have been rejected by SOLG’s board. Jiangxi currently owns 12.19% of SOLG. | PINK | |
Target Healthcare Reit (LON:THRL) (£600m | SR76) | Acquired 3 operating care homes in Scotland and committed to purchase a fourth that’s under construction for £45m (blended net initial yield >6%). All involve sale-and-leaseback deals with the same existing operator. | ||
Caledonia Mining (LON:CMCL) (£449m | SR93) | National Budget proposing increase in royalty from 5% to 10% when gold >$2,500/oz and change to tax treatment of capex. If implemented, changes would result in profitability below current expectations. | ||
Ab Dynamics (LON:ABDP) (£302m | SR48) | Ansible Motion awarded €9.7m contract with a major European OEM. Revenue exp H1 26/H1 27. Confirms that new group CEO Sarah Matthews-DeMers starts today. | ||
Impax Asset Management (LON:IPX) (£222m | SR92) | AUM -30% to £26.1bn, net outflows £13.0bn. Improving trend in H2. Rev -17%, PBT -43% to £27.8m. Cash reserves £64.7m. | (Graham to do) | |
Peel Hunt (LON:PEEL) (£129m | SR77) | Revenue +38%. PBT £11.5m (H1 last year: £1.2m). Headcount reduced over 15% from peak in 2023. Confident in meeting market expectations for the full financial year. | GREEN = (Graham) The company - which has a place on my annual watchlist - has already achieved more than 100% of its full-year net income forecast in H1 alone. So clearly, I'm going to want to stay GREEN here. Perhaps H2 will be extremely quiet, as implied by market expectations. But I think it's right for me to stay positive, especially considering that balance sheet asset backing has improved to over £100m. | |
Solid State (LON:SOLI) (£81m | SR49) | “Strong” trading in H1. Interim CEO appointed after the passing of the CEO. Directors confident in meeting full year consensus expectations. | ||
Topps Tiles (LON:TPT) (£79m | SR45) | New CFO will join in Spring 2026. She is currently Group Finance & Investor Relations Director at Watches of Switzerland Group Plc. | ||
Wynnstay (LON:WYN) (£75m | SR96) | Underlying trading results for FY25 to be modestly ahead of current market expectations with adjusted profit before tax of approximately £9.0m. Early trading in new financial year is in line. | GREEN = (Roland - I hold) Today’s update suggests operational and commercial changes being implemented as part of CEO Alk Brand’s Project Genesis turnaround plan may be helping to improve profitability. However, there’s not much evidence of underlying growth in my view, with cyclical/commodity market conditions remaining mixed. A big discount to book value and year-end net cash covering c.30% of the market cap give me confidence to stay positive here, as I think there’s significant potential for further re-rating if volumes improve as the implementation of Genesis gathers pace. The main risk I can see is that Wynnstay may be pushing on a piece of string – if its core markets are in structural decline or oversupplied, as I’ve seen suggested, then it could be difficult to ignite growth. | |
ECO Animal Health (LON:EAH) (£64m | SR98) | Revenue +19%, adjusted EBITDA £3m (H1 last year: £0.4m). Cash £18.6m. Expects H2 weighting. Board confident FY26 will be in line with current market expectations (adj. EBITDA £7.7m). | ||
One Health (LON:OHGR) (£32m | SR78) | H1 growth in-line with management expectations. Revenue +18%, underlying EPS -8%. Outlook: confident FY26 will be in line with market expectations. | ||
OPG Power Ventures (LON:OPG) (£24m | SR96) | Share Buyback Offer reduced from £11.4m to £9.9m so that the Family Concert Party might potentially own 84.97% of the company rather than 94.41%. | ||
Genedrive (LON:GDR) (£11m | SR4) | Pilot Programme Study Results underpinning NHS Implementation Guide for CYP2C19 Genotype Testing Presented at the UK Stroke Forum. |
Graham's Section
Peel Hunt (LON:PEEL)
Up 1% to 106p (£130m) - Interim Results - Graham - GREEN =
Peel Hunt Limited ('Peel Hunt', the 'Company') together with its subsidiaries (the 'Group') today announces unaudited interim results for the period ended 30 September 2025 ('H1 FY26').
This is on my 2025 watchlist, so I’ve been taking an especially keen interest in it!
Sentiment worsened during the early part of this year, but has since recovered:
And although the share price hasn’t moved much today, I think that the interim results do go a long way towards justifying the renewed optimism:
H1 revenue +38% to £74m (even a little better than was disclosed in the H1 trading update).
Adjusted PBT £18.7m (H1 last year: £4.6m)
PBT £11.5m (H1 last year: £1.2m).
I don’t think that the market really cares too much about the official consensus forecasts here, but for what it's worth the company is officially forecast to make a net income of £6.8m for the financial year ending March 2026.
But they’ve already made a net income of £8.3m in H1 alone! So as I said: I don’t think anyone cares about the official forecasts here.
One of the main reasons I’ve been bullish on the stock is the balance sheet, which I believe offers plenty of deep value for bargain hunters.
That value has risen with net assets of £100.7m now, up from £88.7m six months ago.
Checking the statements, I can confirm that there is almost nothing intangible included in that figure (less than £500k).
So the asset backing has improved significantly.
Cash: there was a £6.8m cash outflow in H1 which includes £3m spent on a loan repayment and a £2m cash outflow because the company is no longer a majority shareholder in Retail Book (though it does still have a stake of nearly 41%).
Even putting those two cash outflows to one side, you might wonder why the company didn’t make more cash in H1. The reason is simply that there were large shifts in working capital (more securities held for trading and more debtors). Working capital swings can be huge here over a short timeframe, and I don’t worry about them at all. The company assures us that “Capital and liquidity remain comfortably in excess of regulatory requirements”.
Cost control: I have made some mild criticisms of Peel Hunt in the past for being unable to reach breakeven in its bad years, which I think ought to be possible if employee pay is variable enough
Thankfully, there has been progress in terms of cost control, with the company reporting that headcount is down by 15% since the peak in FY23, and underlying fixed costs down by approx £5m in FY26.
Investment bank: revenues surged by 45.6%. “The most active investment bank for all UK ECM transactions in H1 with a market share of approximately 17”. In M&A, they are “third in the UK public M&A league tables behind only global investment banks”.
The total number of investment banking clients did fall slightly, from 147 to 143, but their average market cap has nearly doubled over the last three years. And the number of FTSE-350 clients has increased from 52 to 57 over the past six months.
Execution: revenue is up 56.8% year-on-year to £27.6m. The tariff-related volatility occurred in early April, i.e. during this H1 period. This was the “best half-year performance since the Covid lockdown period”.
Research & distribution: more stable here, revenues up just 2.2% year-on-year, with a new Middle East office in Abu Dhabi. And the quality of the research is good for the bank’s reputation generally.
Current trading and outlook:
The Group has made a strong start to the second half, successfully completing several sizeable investment banking transactions, and performance from our Execution Services business, although down from the highs of the first half, has been robust. Consequently, we are confident in meeting market expectations for the full financial year.
Graham’s view
The situation here vis-à-vis market forecasts is very odd. Peel Hunt is only supposed to earn net income of £6.8 this year.
Therefore, I think that they have already earned over 60% of the current full-year revenue forecast, and over 100% of the full-year profit forecast.
The revenue forecast on the StockReport today (£99.8m) can’t be right, with £74m already achieved in H1. Hopefully we will have that updated soon.
Overall, therefore, things aren’t quite adding up. The most logical explanation is that Execution revenues will collapse in H2, now that markets have calmed down (post-tarriffs), and that Investment Banking revenues will also be slower.
If we have a very quiet H2, then perhaps the company will fall back to breakeven or a small loss in the second half - but even then, it seems likely that they will outperform the profit forecast for the year.
Either way, I’m happy to stay GREEN on this. With asset backing of £100m+, it seems to me a no-brainer for a global investment bank to try to buy this out.
Even if that doesn’t happen, I believe that it’s logical for these shares to re-rate higher. Let’s see if H2 turns out to be as weak as is suggested by market expectations.
Roland's Section
Wynnstay (LON:WYN)
Up 7% to 345p (£80 million) - Trading Update - Roland - GREEN =
(At the time of publication, Roland has a long position in WYN.)
The Board expects underlying trading results for the year to be modestly ahead of current market expectations with adjusted profit before tax of approximately £9.0m
Today’s update from agricultural supplies group Wynnstay covers the year ended 31 October and makes for fairly positive reading. It has also prompted an earnings upgrade from house broker Shore Capital.
Here’s a summary of the main points:
Feed & Grain: improved year-on-year profitability despite lower volumes, thanks to improved margins and cost control.
Savings have been achieved by the closure of the Twyford Mill, while the expansion of the Carmarthen facility has added 20,000 tonnes of capacity and is largely complete.
Grain trading was affected by a weaker harvest and lower wheat prices, but the integration of all grain trading activities into the GrainLink model was completed on schedule.
Arable: profits increased year-on-year, with significantly higher blended fertiliser sales supported by the opening of the new Avonmouth blending facility. Margins have benefited from improved commercial discipline.
Stores: Like-for-like retail sales were “broadly unchanged”. I can’t find a LFL figure in last year’s results, but total sales last year were broadly flat (down slightly).
Balance sheet: net cash at the end of the year was £26.4m (excluding leases), down from £32.8m at the end of FY24.
Project Genesis: the design phase of CEO Alk Brand’s turnaround plan “is now complete” following a group-wide asset review. Integration activities are now underway.
One-off costs resulting from this process are expected to be from £5.4m to £5.9m in FY25, with a net cash cost of £2.0m to £2.5m. No further material restructuring charges are expected in FY26.
A HSE investigation following a fatality in January 2025 remains underway. A further update will be provided as appropriate.
Outlook
Trading so far in FY26 is “in line with the board’s expectations”. Focus remains on delivery of Project Genesis – I’ve highlighted the FY26/27 stage below (apologies for the small print):
Source: Wynnstay FY24 results
Updated estimates
Management guidance is now for FY25 adjusted pre-tax profit of “approximately £9.0m”. Checking back to July’s broker notes, previous expectations appear to have been for a figure of £8.5m.
Today’s update represents an increase of around 6%.
This is also reflected in house broker Shore Capital’s updated forecasts, which are available on Research Tree – many thanks:
FY25E adj EPS: 28.5p (+6% vs 26.9p previously)
FY26E adj EPS: 31.6p (unch)
These estimates put the stock on a P/E of 12 for the current year.
Roland’s view
The impression I get from today’s update is that profitability improved slightly last year, but there wasn’t much growth. As far as I can tell from the update, the only division that may have seen growth was Arable, where the company reports higher fertiliser sales and “a strong autumn grass season”.
I don’t think this is necessarily a problem – to a large extent I suspect it reflects the cyclical and commodity-based nature of the business. A look at the long-term chart reminds us that these cycles have happened before:
It’s also fair to point out that the growth elements of Project Genesis are only really expected to kick in from FY26 onwards, as underlying structural and commercial changes are completed.
As a shareholder, I am content to remain holding and reassured by the continued deep discount to book value and net cash balance.
Together with a useful 5%+ dividend yield, this discounted valuation helps to offset the structural low profitability of this business:
If CEO Alk Brand can achieve his goal of a “higher level of base earnings” and “improved margins” and cyclical conditions improve, then I think Wynnstay shares could enjoy a re-rating.
Of course, these conditions are not assured and may not easily be achieved. My main concern is that Wynnstay may be pushing on a piece of string – if its core markets are in structural decline or oversupplied, as I’ve seen suggested, then growth could be difficult unless the company can displace weaker competitors.
The StockRanks have a very positive view, with Super Stock styling and a high StockRank, even ahead of today’s upgrade:
The strong balance sheet value on offer and attractive yield give me sufficient confidence to maintain my previous GREEN view.
Renewables Infrastructure (LON:TRIG)
Down 4% to 71p (£1.71bn) - Update on the Combination of HICL and TRIG - Roland - AMBER =
(At the time of publication, Roland has a long position in TRIG.)
It seems that opposition from HICL shareholders has forced the infrastructure investment trust’s board to abandon plans to combine its business with renewables group TRIG.
I reported on this plan previously two weeks ago here. It seemed fairly sensible to me as a TRIG shareholder, but apparently this view was less popular among HICL investors.
We don’t know exactly why HICL shareholders were opposed, but one possible guess is the recently announced government consultation on proposed changes to the pricing of Renewable Obligation (RO) and Feed-in-Tariff (FiT) schemes.
A key element of the scheme seems to be switching price indexation of RO and other subsidy schemes from RPI to CPI. The impact of this would be that subsidy rates would rise more slowly than previously expected. The purpose of the proposal is to reduce energy costs, as these subsidy costs ultimately feed through to consumer bills.
Two options have been suggested:
Option 1: an immediate switch from RPI to CPI pricing for future indexation
Option 2: freeze RO buy-out prices until they catch up with the level they would have been at if they’d always been indexed to CPI. The government’s own figures suggest this could mean RO buy-out prices remained frozen until 2034/35 – 10 years from now.
TRIG has not publicly commented on this, but its listed peer Greencoat UK Wind (LON:UKW) did comment and suggested that the two options under consideration could reduce UKW’s NAV per share by 1.7% or 7.4% respectively.
Roland’s view
At this stage, this is only a consultation and might not proceed at all – or only in a changed format.
It’s also worth emphasising that TRIG’s portfolio does not have the same mix of assets and subsidies as UKW, so we can’t assume the same impact on TRIG. But I think it’s fair to assume the potential impact could be in a similar ball park.
In my view, what’s likely to have spooked HICL shareholders is the whiff of retrospective change suggested by the government’s proposals. Markets hate uncertainty. The idea that the terms of a long-term arrangement could change unpredictably midway through is likely to be offputting for many investors, I’d imagine.
Where does that leave TRIG shareholders? Now that the company is no longer in an offer situation, I’d hope that its management might comment on the government’s proposals.
TRIG’s H1 results suggested to me that cash flow cover for its dividend is going to be very tight indeed.
My impression is that asset sales have been slower than expected this year. Prior to the HICL offer, TRIG was in the process of arranging a new financing facility, which I understand would be used to support growth investment and the repayment of its existing credit facility.
However, the company reiterated guidance for a 2025 dividend payout of 7.55p per share in its interim results, so perhaps this year’s distribution will be safe.
However, my feeling is that a cut may become necessary next year if weather and power pricing do not become more favourable over the winter.
One option that might provide more certainty for investors is if TRIG can secure further long-term corporate power purchase agreements (PPAs) similar to the one recently agreed with Virgin Media O2. This type of arrangement reduces exposure to both subsidies and power price volatility and should provide reliable cash flow with good visibility.
As a shareholder I am somewhat on the fence here. TRIG shares are now trading at what appears to be a record low of 71p – a 35% discount to NAV (30 Sept 25: 109.7pps):
Based on dividend guidance with the interim results, this price implies a 10.6% dividend yield.
However, my confidence in the security of this dividend is weakening.
Today’s update was brief with TRIG’s broad reiterating their confidence in the company’s standalone strategy and opportunities, but also suggesting further shareholder consultation is likely:
We are uniquely placed to capitalise on the demand growth for low carbon, reliable power and to capture the commercial opportunities as economies across the UK and Europe electrify and decarbonise. Doing so will allow us to deliver sustainable value and growth for our shareholders, with whom we will continue to engage on the path ahead.
I think we could see some consolidation in this sector over the coming years. Conditions are tougher and less certain than they were, but there’s clearly still a long-term opportunity and need for these assets, in my view.
I’m going to maintain my neutral view from November today in the hope that TRIG may soon provide a more concrete update to shareholders about its prospects and plans.
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