Daily Stock Market Report (Fri 20 June 2025) - CARR, REC, DORE, LORD, CAML, IDHC, CYK, ORCH

Good morning! 

I'll be working on this report until about 10.00-10.30, when I'll need to start preparing for a chat with the management at Record (LON:REC). Please let me know if you have any questions you'd like me to ask them!

Alex has asked me to help share the new product release notes: dividend dates and news enhancements.

Spreadsheet accompanying this report: link

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Wrapping it up there for today. I'll type up my Record notes next week. Have a great weekend!

Best regards

Graham

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Companies Reporting

Name (Mkt Cap)	RNS	Summary	Our view (Author)
Berkeley group (LON:BKG) (£4.1bn)	Final Results	PBT -5% (£529m). ROCE 16.5%. “Well-placed to achieve our FY26 pre-tax profit guidance of £450m.”
Gulf Keystone Petroleum (LON:GKP) (£351m)	AGM Operational & Corporate Update	Production guidance unchanged (40-45k bopd). Capex & cost guidance unchanged.
Central Asia Metals (LON:CAML) (£286m)	Revised proposal with New World Resources	The prior offer was A$0.05/share. Observed a buyer at price above that. New offer: A$0.053/share. In a separate RNS, they announce that they've bought New World shares on the market at A$0.055.	AMBER/GREEN (Graham) [no section below] I have no particular view on this as it's outside my wheelhouse, so I will leave the AMBER/GREEN stance from Mark unchanged (see here). But I do find it interesting that they have been spurred into increasing their offer for New World Resources, after noticing that there was a large buyer of New World shares at a price higher than CAML had offered for the business. Those purchases, predicting that New World was worth more than A$0.05 per share, have turned into a self-fulfilling prophecy! CAML, anticipating some resistance to their initial offer, have now sweetened the deal.  CAML have significant cash resources (US$67.6m as of Dec 2024) but their offer values New World at US$128m, so they will need to use their RCF to fund the deal.
Integrated Diagnostics Holdings (LON:IDHC) (£155m)	IDH Strengthens Egyptian Radiology Portfolio	Buys a radiology and radiotherapy facility in East Cairo for EGP 400 million (£6m).	AMBER/RED  (Graham) [no section below] The deal sounds great but I have to retain our AMBER/RED on this due to the difficulty of assessing the Egyptian economy and the numbers in the context of a 17% inflation rate. But I have no reason to doubt that IDHC will success in its plans to create "a top-tier provider in the burgeoning Egyptian radiology and radiotherapy market".  The financials look very  good (StockRank 89, including a QualityRank of 97). But it's hard to look past the fact that it's reporting in the Egyptian pound, a currency whose value does not seem very dependable. I'm still scarred since I ventured abroad with DPEU, whose reporting currency was the Turkish Lira!
Downing Renewables & Infrastructure Trust (LON:DORE) (£141m)	Offer for DORE	102.6016p per share offered (previous share price: 83p) by DORE’s largest shareholder.	PINK (Graham) [no section below] This has been listed since late 2020, just as the IPO boom was starting. It “delivers stable returns by investing in a diversified portfolio of hydropower, solar and other infrastructure assets”. With commitments and indications of support for the takeover already received from 22% of those shares eligible to vote for it, the proposal is off to a good start. Further proof that trusts have been undervalued on the LSE?
Carr's (LON:CARR) (£137m)	Results of Tender Offer	Oversubscribed, so excess tenders get scaled back. 45% of shares to be bought back at 163p. In a research note published in May, Edison forecasted PBT of £4.4m in FY August 25, rising to £6m in FY26. Cavendish forecasted adj. PBT of £4.0m in FY25, rising to £5.1m in FY26.	AMBER (Graham) [no section below] After the tender offer, Carr’s will have its Agricultural feedstock division, c. £15m of cash, and 51 million shares left outstanding. The tender offer complicates EPS forecasts but in simple terms, the current market cap (£137m) minus the tender offer amount (£70m) leaves an implied value of £67m for the Agricultural division plus the remaining cash balance. Regardless of whether Cavendish or Edison turn out to be more accurate, the valuation here seems pretty fair, so I’m neutral.
Record (LON:REC) (£114m)	Final Results	AUM -1%, revenue -8% (£41.6m), PAT -2% (£9.1m). Outlook: low single digit growth, flat EPS.	GREEN (Graham) Staying GREEN on this high-quality financial. It continues to offer investors a rock solid balance sheet and a very generous dividend (although it may be difficult to maintain it at this level). Growth is limited, but that has been the case for a long time. It continues to work on various growth initiatives.
Lords Trading (LON:LORD) (£72m)	AGM Statement	On track to meet exps for FY25. Positioned well for any sustained improvement in the RMI market. Lords is “a specialist distributor of building, plumbing, heating and DIY goods”. Cavendish leave forecasts unchanged including adj. PBT of £6.7m in the current year, with EPS of 2.9p.	AMBER (Graham) [no section below] I can leave our neutral stance on this unchanged after this “in line” update (previous coverage by Mark here). One of the main worries for us is that there tend to be very heavy adjustments to the results. This is a low-margin distributor and I struggle to believe that it should trade at a much higher multiple than it’s already trading it, so I’m neutral. But if it gets a macro tailwind behind it, then investors should do well.
Cykel AI (LON:CYK) (£13m)	68% Month-on-Month Growth	Recurring revenue +68% over past 4 weeks, driven by company’s autonomous recruitment agent.	RED (Graham) [no section below] No pound figures are provided in this RNS. Checking its most recent annual report, I see that it generated revenues of £817 over the 13-month period, or £63 per month. With 68% growth, maybe this has increased to £106 per month? It also has a “bitcoin treasury reserve strategy”, which I think is a red flag.
Orchard Funding (LON:ORCH) (£11m)	Trading Update	SP +19% FY2025 earnings to exceed market expectations by over 20%. Revenue growth and increased margins within the insurance premium finance market.	AMBER (Graham) [no section below] This is a Super Stock with a StockRank of 99, and has just announced that it is going to easily beat expectations. However, the Board want to delist from AIM. They just haven't quite got around to it! In the interim results (published in March), they said: "The board has not changed its view that the continued admission of Orchard's shares to trading on AIM may not be in the best long-term interests of the company or its shareholders. We do not have short-term plans to address this issue and will therefore, for current purposes, continue with the AIM admission." How strange! The co-founder and current CEO owns 57% of the company. At a P/E ratio of perhaps 4x, this stock looks perfect for nano-cap value investors who don't mind taking the risk of a sudden delisting. They can't say they weren't warned!

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Record (LON:REC)

Down 6% to 53.98p (£107m) - Final Results - Graham - GREEN

Chatting to management a little later - let’s see some of the highlights from these results (FY March 2025).

There were “isolated outflows” which sent AUM down 1% by year-end to $100.9 billion.

Revenue fell 8% to £41.6m due to lower performance fees.

PBT and PAT are both a little lower than last year.

However, EPS is higher than last year.

This is because PBT and PAT include all of the losses at German subsidiary Record Asset Management GmBH.

EPS, on the other hand, excludes most of those losses, due to the RAM management team having a large stake in the business.

Therefore, Record’s EPS increases slightly, from 4.84p to 5.03p.

Dividend: the final divi of 2.5p takes the overall dividend for the year to 4.65p, or 92% of EPS.

The outlook statement seems to tacitly acknowledge that paying 92% of EPS out in the form of dividends is a challenge:

We have started FY-26 with a well-positioned pipeline. Over the medium term, we expect the deployment of new funds in the Private Markets space in particular to drive revenue and EPS growth.

The outlook for the current year is highly dependent on the timing of closing the large and complex deals currently in the pipeline, but we are anticipating low single digit revenue growth and flat EPS year on year.

Recognising the importance of the dividend to investors, and the uncertainty of timing of new revenue growth, we remain committed to paying a healthy ordinary dividend while always balancing that with the aim of maintaining a strong balance sheet

Balance sheet: there is equity of £29m on the balance sheet, almost fully tangible and very liquid (current assets of £27m vs. current liabilities of £6m).

CEO statement:

"I am very proud of what we have accomplished in my first year as CEO of Record. We have added new capabilities in our Private Markets pillar to complement the core Risk Management and Absolute Return expertise which Record consistently delivers year after year. Our unwavering commitment to delivering a best-in-class, tailored client experience continues to be a key differentiator - one that not only strengthens client relationships but also attracts top-tier talent to our team."

On strategy, the Chairman says “it is now appropriate to view the Group as an alternative asset manager with a strong emphasis on risk management”.

The group is now structured in three divisions: Risk Management, Absolute Return, and Private Markets. Private Markets. Private Markets is seen as driving growth in the medium-term. It includes $1bn of AUM in an Emerging Markets Sustainable Finance Fund. There is also €1.1bn of commitments to Record's Infrastructure Equity Fund.

Graham’s view

I tend to be positive on Record (e.g. see my brief comment in April) but it’s important to acknowledge its limitations. It hasn’t shown much growth over the years, and while there are positive noises today re: the pipeline, growth is not something I’d bank on here.

Instead, this is a company with a fine, long-standing reputation among institutions for its ability to provide currency risk management services, with some more enterprising (and complementary) activities bolted onto it. The balance sheet is always rock solid, and the company has paid out as much as it possibly can to shareholders in the form of dividends. These dividends account for most of the return here, as the share price hasn’t gone anywhere:

I’m happy to stay GREEN on it and the StockRanks do agree with me, rating it as a Super Stock with a score of 94. But it remains to be seen whether the company's latest set of growth initiatives will bear fruit.