Argentex shares reopen lower

At the start of the month, we alerted members that trading in Argentex shares had been temporarily suspended following an unexpected liquidity crisis. The company had revealed that a sharp move in currency markets—driven by a surge in volatility following new US tariffs—had left it exposed to significant margin calls. As a result, it was unable to meet near-term cash requirements and asked the regulator to suspend trading on 22 April while it explored emergency funding options.

The deal marks a dramatic turn for a company that had only recently signalled confidence in its strategy for renewed growth. Both the CEO Jim Ormonde and CFO Guy Rudolph have stepped down as part of the agreement, and several board members have resigned. The focus now turns to stabilising the company under IFX’s ownership and navigating a transition period amid ongoing market volatility.

While IFX’s intervention has averted insolvency for now, Argentex faces a major reset. The group’s business model—particularly its use of “zero-zero” contracts—has come under scrutiny, and it remains to be seen how IFX will restructure operations moving forward. For now, shareholders have been heavily diluted, and we will continue to monitor developments as the integration progresses.

Eleco shares rise after strong set of final results

Shares in Eleco (ELCO) moved higher this morning after the specialist software firm delivered a robust set of final results, with revenue, profit, and cash generation all coming in ahead of market expectations. The company reported double-digit growth across the board, including a 16% increase in headline revenue and a 26% rise in EBITDA. Recurring revenue now represents 77% of the business, underlining the strength of its transition to a SaaS-first model.

Operationally, Eleco continues to invest in innovation. It launched AstaGPT™, its in-house generative AI tool, and picked up a major industry award for the 11th year running for Asta Powerproject®. The business also expanded its offering with the acquisitions of Vertical Digital and PEMAC, enhancing its asset management capabilities and technical consulting reach. With recurring revenues at record levels and multiple growth levers in play, Eleco looks well positioned for further progress in 2025.

Filtronic signals upgrade cycle as outlook exceeds expectations

Filtronic (FTC) has caught the market’s attention again after releasing a bullish trading update that outlined expectations to beat forecasts for both FY2025 and FY2026. Management highlighted a step-change in capacity, with recent manufacturing investments now fully online and supporting growing customer demand. As a result, revenue and adjusted EBITDA are expected to come in ahead of current estimates for the full year.

Investor sentiment has been improving steadily. Shares have broken higher following last week’s upgrade, briefly retesting trend highs from early 2021 before consolidating. The market appears to be reappraising the business as a scalable, profitable supplier into strategic end markets—particularly with increased visibility now in place for the next two financial years.

There’s also a broader re-rating theme at play. As Filtronic moves from years of groundwork into what could be a sustained earnings upgrade cycle, investors are looking ahead to margin expansion and cash generation. With scale beginning to unlock operational leverage, the focus now turns to how far this run of momentum can go.

Gamma grapples with UK headwinds as outlook holds steady

Gamma’s (GAMA) latest trading update, delivered ahead of its AGM, offered a mixed bag for investors—and the market reaction has been cautious. While integration of its recent German acquisitions is progressing well and continental European trading has started the year on a strong note, ongoing weakness in the UK has continued to weigh on sentiment.

Shares have been under pressure since the update, falling back from recent highs and now trading below the levels seen prior to Gamma’s move to the Main Market earlier this month. The technical picture reflects uncertainty, with sellers stepping in near resistance and a lack of short-term momentum to drive a breakout.

The longer-term story remains intact, particularly as integration efforts in Germany begin to bear fruit and Gamma positions itself for inclusion in the FTSE indices. But for now, the focus is on stabilisation rather than acceleration—making the upcoming interim results in September a key milestone to watch.

H&T surge on takeover from US giant FirstCash

Shares in H&T (HAT) jumped 40% after it agreed to a recommended £297m cash acquisition by FirstCash Holdings, the largest publicly traded pawn operator in the US and Latin America. The deal values H&T at 661p per share – 650p from FirstCash’s bid vehicle, Chess Bidco, plus a final dividend of 11p. This represents a 44% premium to the prior close, and a 78% premium to the six-month average – offering shareholders the chance to cash out at a level the shares have never traded at in the AIM market.

Shares surged to just below the offer price, suggesting the market sees limited chance of a rival bidder. The offer is final unless another suitor appears – so we’ll be watching to see if anyone else joins the bidding war. For now, this looks like a well-timed cash exit for shareholders at a historic high.

IG Design bounce from lows on trading update

IG Design’s (IGR) full-year update confirms that FY25 sales and profit will land in line with January’s revised guidance. Group revenue fell 9% year-on-year, largely due to persistent headwinds in the US market, where DG Americas saw a sharp 12% decline and reported a loss. Across the business, subdued consumer demand, retailer bankruptcies, and inventory challenges weighed on performance. Despite this, adjusted profit before tax is expected to be around $1 million.

DG International, which reported a modest 3% revenue decline, remained profitable, though earnings fell 13% due to freight inflation and supply chain disruptions in H1. These issues have now largely been resolved. Management remains upbeat on its long-term potential, supported by strong retailer relationships and opportunities for growth in new markets and categories, especially across Europe.

While cash levels dipped to $84 million due to working capital pressures, the Group remains in a solid financial position and has extended its asset-backed lending facility to June 2027. A significant impairment on DG Americas is expected to be recognised as a non-cash adjusting item. With potential divestment on the table, IG Design is positioning for a leaner, more focused future as it looks to strengthen its international operations and drive more consistent shareholder returns.

Solid State expects FY results ahead of forecasts

Solid State (SOLI) has delivered a stronger-than-expected performance for the year to 31 March 2025, with revenues and adjusted pre-tax profit both coming in ahead of market forecasts. Revenue is expected to exceed £124 million, with adjusted profit before tax of at least £4.25 million, helped by a healthy finish to the year and gross margins above 30%. The open order book stood at £108.5 million, boosted by a substantial £19 million communications order, pointing to solid momentum entering the new financial year.

Components delivered a steady performance amid ongoing industrial destocking. Despite near-term challenges, the division is optimistic about a return to growth this year, supported by growing order books from defence and medical customers. The US operations are also forecasting robust expansion, with the team making good progress on shifting production away from China to sidestep rising tariffs.

Looking ahead, Solid State reiterated its outlook for the new year, with confidence stemming from its global structure, specialist capabilities, and a strong pipeline in defence, security and medical sectors. With net debt of just £7.5 million and strong cash generation, the Group remains well positioned to continue investing in both organic growth and bolt-on acquisitions across the UK, US and Asia.

Totally warns on profits and launches strategic review

Totally (TLY) has issued a profit warning for the year ended 31 March 2025, with EBITDA now expected to fall between £0m and £2.0m—well below the previously guided £3.5 million. The shortfall comes after operational challenges, including a slower-than-expected ramp-up of a new contract and the loss of higher-margin NHS 111 work. Despite efforts, the business has not been able to redeploy staff or costs associated with the contract loss, adding further pressure to margins.

Although current trading is said to be profitable on a monthly basis and customer satisfaction remains high, the Board acknowledges the urgent need to strengthen the balance sheet. The company is forecasting further contract wins in the coming months but remains cautious on guidance until a clearer picture emerges.

Meanwhile, CFO Laurence Goldberg has stepped down from the Board, and an experienced finance advisor with listed company experience has been brought in to support the Group through this transitional period.

Separately, Totally has disclosed a historic medical negligence claim relating to a 2018 incident. Initial advice had suggested any liability would be covered under the Group’s insurance, which was twice the NHS minimum requirement at the time. However, new correspondence has raised the possibility that the claim may exceed the £10 million policy limit. The process is expected to take time, and the Group is working with insurers and legal advisors to reach a resolution.

TPXimpact rallies on earnings beat and £16m government contract wins

Shares in TPXimpact (TPX) rebounded sharply following a trading update that showed improving profitability and two sizeable contract wins with the UK Government. Despite an 8–10% revenue decline for the year ended 31 March 2025 (FY25), the company expects to report Adjusted EBITDA at the top end of its guidance range, underscoring operational improvements made through a challenging year.

Net debt (excluding leases) has been reduced to around £8.5 million, ahead of expectations and comfortably within banking covenants. Management now targets further debt reduction in FY26, aiming for £7–8 million by year-end, which would take leverage below 1.5x.

Looking ahead, the company is guiding for £6–7 million in Adjusted EBITDA for FY26, a solid increase from the FY25 consensus of £4.9 million. Management remains cautious but optimistic, highlighting improved internal efficiency and resilient client relationships as key drivers of margin expansion.

TPXimpact plans to release its preliminary FY25 results in June.