Introducing you to new investment ideas… Progressive in conjunction with Mello are inviting you to join us for our virtual conference where you will have the opportunity to hear from the management teams of these very different companies:
Tuesday 7th December 2021, 5.30pm
5.30 pm Mello welcome with David Stredder and Karin Schulte
5.35 pm Company presentation by TPX, formally Panoply
6.05 pm Company presentation by ThruVision
6.35 pm Company presentation by Polar Capital Global Financials Trust plc – Beneficiaries of rising rates with George Barrow
7.00 pm Company presentation by LoopUp
7.30 pm Trading update by Belvoir with Q&A
7.45 pm Company presentation by HeiQ
Company Presentation: TPXimpact plc (LON: TPX)
TPXimpact exists to transform the organisations, services and systems that underpin society and that drive business success. It applies strategic and creative thinking, technology, innovative design and user-centred approaches to bring about numerous improvements which together multiply the impact of change. The Company works closely with its clients in agile, multidisciplinary teams that span organisational design, technology, and digital experiences. It shares a deep understanding of people and behaviours and a philosophy of putting people and communities at the heart of every transformation.
The business is being increasingly recognised as a leading alternative digital transformation provider to the UK public services sector, with c.75% of its client base representing the public sector and c.26% representing the commercial sector.
Neal is a serial tech entrepreneur having co-founded four companies that exited successfully with a combined value of £117m. He co-founded his first company at the age of 21 and, under the brand name of Jungle.com, that company went on to be sold to GUS for £37m. In 1996 he co-founded Xplora and sold it to Nasdaq-listed USWeb in 1998.
Neal then co-founded Attenda, a managed services consultancy that went on to be sold for £72m; one part to Telecity Plc and the other to Darwin Private Equity. In 2006 he founded QuickStart Global, an offshore IT service provider, which grew rapidly, and in 2010 was listed in the Sunday Times Tech-Track 100 at number 3, his second company in that list with Attenda having been listed at number 2 in 2001.
Neal Gandhi – CEO and Co-Founder
Oliver Rigby – CFO and Co-Founder
Oliver qualified as an accountant with MRI Moores Rowland LLP in 2006 before spending six years as an adviser in corporate finance with Daniel Stewart andDeloitte. Oliver acted as a Nominated Adviser to the AIM Market of the London Stock Exchange and was one of their youngest Qualified Executives.
Prior to co-founding TPXimpact, Oliver set up Growth Company FD Limited in 2012 to provide part time CFO and corporate finance support to growing businesses.
Company Presentation: ThruVision Group plc (LON: THRU)
Spun out from the British Government’s Rutherford Appleton Labs in 2002, Thruvision Group is an AIM-quoted technology company that develops, manufactures and sells people-security-screening technology. Thruvision has developed a range of exceptional cameras that register minute differences in body heat, and the technology can detect relatively small objects hidden under an individual’s clothing. Based in the UK, Thruvision sells its products globally, focusing on three main sectors, Aviation, Customs and Profit Protection, where it is finding significant opportunities to grow its presence, while Mass Transit and Event/Location Entrance protection markets could be developed in future. A key feature of Thruvision’s technology is that it operates at a physically distant range of several metres and completely removes the need for physical searches.
Progressive view: Thruvision’s technology is differentiated from competing security screening technologies by operating at a safe distance and detecting non-metallic as well as metallic items. COVID-19-related restrictions on close proximity ‘pat-downs’ (required to resolve alarms from walk-through metal detectors and airport body scanners) increased interest in Thruvision’s screening solutions, although the Aviation sector was particularly affected by lockdown travel restrictions. Thruvision has started to expand and tailor its product range and appears well-positioned to address the growing need to safely, quickly and comprehensively security screen individuals for weapons, contraband or other illicit items. Sales contracts are often high value with irregular timing, leading to uneven sales growth, but medium-term prospects seem promising, and the group has demonstrated good cost control while maintaining a strong balance sheet.
Colin was appointed a Director on 8 February 2010 and was appointed Chief Executive of Thruvision Group plc on 1 November 2017, having previously served in a number of senior management positions. He is responsible for all aspects of the business and draws upon his 22 years’ experience delivering innovative new technology to the international security industry and, in particular, to the US Federal Government. Prior to joining Thruvision, Colin spent 15 years with Detica Group plc, where he was Group Chief Operating Officer. He is currently a Non Executive Director at 6point6 Limited and Cloud Gateway Holdings Limited and their associated companies.
Colin Evans, CEO
Adrian Crockett, CFO
Adrian was appointed a director on 1st May 2019. Prior to joining Thruvision, he was CFO at Venture Life an AIM listed consumer healthcare company. Before this he held senior financial management roles at Abbott Diabetes Care Ltd, a division of the US Healthcare company, Abbott, GSK, Novartis and Chiron corporation (prior to acquisition by Novartis, and Powderject pharmaceuticals (prior to acquisition by Chiron. Adrian has a BAcc honours degree in accountancy from The University of Dundee and is a Chartered Management Accountant.
Beneficiaries of rising rates with George Barrow, Fund Manager, Polar Capital Global Financials Trust plc
Polar Capital is a specialist, investment-led, active fund management company offering investors a range of predominantly long-only and long/short equity funds including three thematic investment trusts in the specialist sectors of technology, healthcare and financials.
The company’s open-ended, closed-ended and alternative investment strategies are all based on long-term investment themes, specialist sectors and global, regional or single country geographies. They have a fundamental, research-driven approach, where capacity is rigorously managed to enhance and protect performance.
George joined Polar Capital in September 2010 as an analyst on the Financials Team. He is a co-manager on the Polar Capital Financial Opportunities Fund, with John Yakas, and the Polar Capital Global Financials Trust, with John and Nick Brind.
He has over 10 years’ experience analysing Europe, Asia and emerging markets. Prior to joining Polar Capital, he was an analyst at HIM Capital from 2008 where he completed his IMC.
George has kindly answered a question which went unanswered due to a lack of time during his presentation on Tuesday:
“PCFT is presently trading at a 2% premium; please tell us how the discount / premium has evolved”
“Looking at the premium / discount history for Polar Capital Global Financials Trust plc (“PCFT.L”) since its last Corporate Action in April 2020, it’s been a simple tale of two halves. The Corporate Action of April 2020 took place during the initial eye of the COVID-19 Pandemic storm with Investors taking fright and moving to perceived ultra-safe havens. Banking stocks are very sensitive to economic conditions and were still seemingly scarred by their performance during the Great Financial Crisis of 2008-2011. However, as the Chairman of PCFT.L commented publicly around the last Corporate Action, “we believe that this time, the banks will be part of the solution to the crisis and are not the cause”. Investors remained keen to see how events were going to play out and so PCFT.L soon went to an 8-10% market discount in Q2 2020; meanwhile the Fund Manager made regular modest purchases of the Company’s shares at the high single digit discount level. However, as expectations of COVID-19 vaccines rose and then the subsequent announcement on the 9th of November 2020 of the Pfizer BioNTech vaccine, fortunes changed rapidly for PCFT.L; a high single digit discount rating moved to a small premium rating by late November 2020. Indeed, share issuance recommenced on the 30th of November 2020 at a modest premium and have basically continued ever since at a small premium. It is worth noting that the market value of PCFT.L has gone from a low of £100m to around £500m today. Finally, PCFT.L is structured so that investors have the option every 5 years to exit at Net Asset Value minus minimal costs (1% or less) via a Tender. The next Tender is planned for Q2 2025.”
Company Presentation: LoopUp plc (LON: LOOP)
LoopUp is a Cloud communications platform for premium external communications for business users. Its key platform capabilities comprise Cloud telephony via Direct Routing integration with Microsoft Teams, remote meetings, and managed events. It acquired MeetingZone, a UK-based conferencing services provider, in 2018. LoopUp’s customers benefit from a global fully-managed service, and an emphasis on security, reliability and simplicity. Its customers number over 5,000 organisations worldwide, including more than 20 of the world’s top-100 law firms. The group is headquartered in London, with offices in San Francisco, New York, Boston, Chicago, Dallas, Los Angeles, Denver, Cardiff, Milton Keynes, Madrid, Berlin, Malmo, Hong Kong, Sydney and Barbados.
Progressive view: LoopUp has seen good traction with enterprise customers, and its process-centric and team-based sales approach lends itself to rapid scaling. LoopUp has managed its way through the challenges and opportunities brought about by COVID-19, and has a strong cash balance, a reinvigorated product line-up and some promising pipeline opportunities. It is currently in a period of transition, as the group evolves and continues promoting its Cloud Telephony offering within Microsoft Teams, both selling directly to enterprise customers and indirectly via the large Microsoft partner ecosystem. Meanwhile, the original LoopUp product has continued to evolve, with customers tending to prefer committed-term contracts that provide the group with good margins. It also remains active in the area of high-end webcasts and managed online events.
Steve co-founded LoopUp alongside co-CEO Michael Hughes. Based in London, Steve oversees global commercial activities and is accountable for setting and delivering the Group’s financial plan. Prior to LoopUp, Steve was EVP and main board director at GoIndustry, an online industrial auctioneering platform. As part of its founding team, Steve was involved in GoIndustry’s organic growth and several acquisitions. Previously, Steve spent time at Monitor Company, Mars & Co, and Mobil Oil. Steve has an MBA from Stanford and MEng from St. John’s College, Cambridge.
Steve Flavell, Co-CEO & Co-Founder
Based in London, Simon oversees all global financial operations. Prior to LoopUp, Simon was Financial Controller at Streetcar, which sold to Zipcar in 2011. Previously, he was Financial Controller at Research Now and was involved in the company’s listing on AIM. Simon is a Chartered Accountant who trained with KPMG, and holds a degree in Accountancy from the University of Birmingham.
Simon Healy, CFO
Trading Update & Q&A with CEO, Dorian Gonsalves, Belvoir Group plc
David Stredder interview with Dorian Gonsalves, Chief Executive of Belvoir Group on the Property Market in 2021 and beyond.
Dorian has extensive experience in the property industry having spent seven years with Countrywide before joining Belvoir in 2005 as Business Development Manager. Appointed Sales Director a year later and subsequently Chief Executive Officer, Dorian also spent five years as a director of The Property Ombudsman. Dorian has a deep understanding of franchising and the strategic vision to deliver a successful franchise operation.
Dorian and Louise have kindly answered the questions posed during the webinar for which there was insufficient time to answer:
On Belvoir: judging from your recent trading update, it seems you have generated GBP 10m in free cash flow in the first ten months of 2021. Is this correct? And is this driven by strong operating results or effects such as working capital?
We have very little working capital requirement so the generated free cash flow will be almost entirely from strong operating results.
We have heard the basics about BLV many times before. Please tell us about the trading update! That is what was advertised.
Apologies if we spent too long outlining the business. Its not always easy to second guess how familiar the audience is with Belvoir.
Managed properties per office seems to have stagnated at 200 properties per office over the last 3 years. Why is this? What efforts are you making to increase properties managed per office?
The changes in the composition of the Group will have an effect on this. The 2020 Lovelle acquisition brought on almost entirely sales offices, whilst the 2021 Nicholas Humphreys acquisition brought in mostly lettings offices. We also added 39 dual-branded Nottingham Building Society offices in 2020 that do not do lettings.
In your recent trading update you sound a bit more positive on market normalization into 2022. Is this a correct observation? Markets still discount in a severe drop of results into 2022 so what would you say to those investors?
The housing market has been hard to predict over the past two years due to the abnormal factors around Covid and the stamp duty holiday. What we do know is that there is still unfulfilled demand. Between 2013 and 2019 annual transactions ranged between 1,075,000 and 1,235,000. In 2020 when the property market was locked down for 2 months, transaction numbers fell to 1,045,000 with much of the drop off during the Covid Q2 lockdown being offset by the surge in demand in H2. HMRC have reported on 1,261,000 transactions in the 10 months to October 2021, so 2021 is likely to end at around 1,450,000. If the 2021 transactions fall by 20%, we will have returned to what was regarded as ‘normal’ in the 7 years to 2019. There is a general consensus in the property sector of this being the likely outcome. As a result, analysts are factoring in a reduction to our sales numbers for 2022 that reflects a reversal of the abnormal 2021 uplift.
What proportion of your franchisees are actually profitable?
I would be surprised if there were many franchisees that weren’t profitable as most are operating long-standing businesses that would not have survived in an unprofitable state. Franchisees are required to report their turnover against which we collect management service fees. We do not as a matter of course collect and record franchisee profitability as these are small business owners who are not accountable to us as the franchisor for their expenditure.
The market has recognized your success, some data bases show a substantial premium but on the metrics your share is reasonable. You do not appear to hold any. Please explain.
Dorian owns 646,322 and I own 409,144 shares in Belvoir. We were both pleased to take the opportunity to increase our holding when we exercised certain share options during 2021. In fact I only sold sufficient shares to meet the exercise price and the tax, thereby retaining the full gain in shares. All five board members and a further four senior managers hold shares which in total represents 5.8% of Belvoir’s share capital.
Company Presentation: HeiQ plc (LON: HEIQ)
HeiQ is a global leader in textiles innovation. The company provides over 200 science-based solutions – such as cooling, warming, filtering, purifying and repelling or even destroying viruses – that enable every-day products, including clothing, household textiles and medical supplies, to become more functional.
Progressive view: HeiQ is a unique business, in our view, given its three-in-one business model, comprising research & development, manufacturing (of ingredients and materials) and marketing (to and on behalf of its brand partners). HeiQ benefits from substantial barriers to competitive entry, including patent protection, regulatory permits, its established academic research network and strong brand equity. We believe HeiQ has multiple growth opportunities from its existing product portfolio, new product launches and strategic acquisition activity, with which to achieve its stated objective of reaching revenues of $300m over the medium term.
Carlo studied Environmental Sciences and Forest Engineering (MSc) at the Swiss Federal Institute of Technology, ETH Zurich. He earned his Executive MBA at the University of St.Gallen (HSG). After his service as an army pilot, he started his professional career as co-founder of the ETH spin-off, myclimate, a non-profit organization and prominent provider of carbon offsetting measures. Since 2004, Carlo has served HeiQ as co-founder and CEO, developing the firm from a two-employee company to an over 140-employee company. He also serves as Chairman of ECSA Group, a 108-year-old Swiss chemical and energy distributor with a consolidated turnover of over USD 300 million for 2020 and is a member of the executive board of Science Industries, the Swiss association of the pharmaceutical, biotech and chemical industries.
Carlo Centonze, Co-founder & CEO
Xaver Hangartner, CFO
Xaver started his career in finance in 2005 after obtaining a bachelor’s degree in Business Administration from the University of St.Gallen (HSG). At the beginning of his professional career, he worked with EY Switzerland as an auditor for industrial clients and graduated as a Swiss Certified Public Accountant in 2009. He later worked in various finance positions and led the global finance and accounting team of a listed Korean speciality chemical producer before joining HeiQ in 2018 as Head of Controlling. He was appointed Group Chief Financial Officer in October 2019.