Good morning from Paul & Graham! Today's report is now finished.


Paul's Section:

National World (LON:NWOR) (£53m) - I run through the bull and bear points for this newpaper/digital publisher. It looks cheap, and has almost half its market cap sitting in cash on the balance sheet, earmarked for acquisitions. Despite a strong H1 profit performance, macro storm clouds are gathering, with a deteriorating trend in revenues so far this year. Profits need further cost-cutting to be sustained, which can't carry on forever. It doesn't have any of the historic baggage of RCH (no pension deficit, or debt), but I'm lukewarm on the longer term prospects for NWOR.

Revolution Bars (LON:RBG) (£34m) (I hold) - a surprisingly upbeat year end (FY 6/2022) update. It's trading in line with expectations. House broker forecasts 1.6p EPS (£4.2m adj PBT). Extensive site refurbs (19 done, 18 more in new year). Successful trials of 2 new formats. Has solid balance sheet with net cash. Market still not convinced, due to historic, extensive problems, but the business looks in good shape now, and cheap. Really good mgt I think. Shrugging off macro conditions.

Gyg (LON:GYG) (£10m) - 20.5p (down 35%) [No section below] - H1 trading sounds fine, in line with mgt forecasts. H2 outlook is good, with strong order book & pipeline. In line with FY 12/2022 mkt exps of E5.0m EBITDA. Cashflow problems assisted by loan from major shareholder Harwood Capital.

Separate bombshell announcement that it plans to de-list (hence shares down 35%) - this is a big, and growing danger for holders of micro caps - beware! Particularly where there are a small number of controlling (over 50%) shareholders, as is the case here. Much though I admire Harwood Capital’s stock-picking skills generally, they also have form for persuading investee companies to de-list, thereby squeezing out private shareholders (at a bad time/price in this case). Although to be fair, GYG never should have floated, it’s unsuitable for public markets, and has had a disappointing & erratic performance. So there's little point in retaining the listing. It snatches the potential upside away from PIs though, which is a pity given that the trading update is good.

Revolution Beauty (LON:REVB) (£84m) - profit warning - shares have collapsed since the CFO left in May. Auditors need another month to check the FY 2/2022…

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