Evolve Capital Share Discussion Threads

[lufc5] 28/6/2011 19:15

Could be interesting tomorrow.

[acquisitor] 28/6/2011 12:32

Hello Evolve! Just bought a million shares in this and thought I'd come and join the party here.

Is it me or is this company an absolute bargain?

[double6] 24/6/2011 16:22

Further update...

Evolve Capital PLC

24 June 2011

For immediate release 24 June 2011

Evolve Capital plc

("Evolve" or the "Company")

Proposed cancellation of admission of Astaire Group plc on AIM

Intentions of Evolve for Astaire Group plc

The Board of Evolve notes the announcement released earlier today by Astaire Group PLC ("Astaire"), a company in which Evolve has a 53.6 per cent. interest.

Astaire's announcement makes reference to the settlement of the company's litigation with Izodia plc ("Izodia"), which the Board of Evolve considers to be a welcome development. The announcement also gives details of Astaire's intention to convene a general meeting of Astaire to consider the cancellation of its admission to trading on AIM, which is a course of action that the Board of Evolve supports. In addition the announcement contains statements regarding the implementation of Astaire's investing policy and Evolve's possible intentions for Astaire post a de-listing.

Despite the settlement of the litigation with Izodia the Board of Evolve believes that the realisation by Astaire of its assets and the settlement of its liabilities in preparation for a return of any excess cash to its shareholders is likely to require some considerable period of time and involve presently unquantifiable costs. The Board of Evolve further believes that the investment environment may change significantly during the intervening period.

For these reasons the Board of Evolve is currently considering whether it might be in the best interests of Evolve shareholders for an alternative strategy to be pursued which would involve Astaire becoming a more active investing company. Should this strategy be implemented Evolve may seek to appoint individuals to the board of Astaire for this purpose. Under this alternative strategy Astaire would not then return any excess cash to shareholders of Astaire but would instead seek to invest the cash that it currently holds, and any amounts realised from its present investments, into as yet unspecified investment opportunities with a view to increasing the value of Astaire's assets for the ultimate benefit of all of its shareholders.

[warpedone] 24/6/2011 16:05

Astaire litigation settled!

[acquisitor] 13/6/2011 10:00

So when are results due?

[targatarga] 22/1/2011 12:15

markt - mistakes easily made when hunting for scapegoats. Think you may find oliver and his brother have led many a dance through the markets over the years[some successful others not]. Last time i looked oliver was on the renumeration board of barclays..... Good luck on your crusade... tt

[acquisitor] 13/1/2011 23:16

In my above calculation, I had assumed that the 53% stake in Astaire was worth nothing. I think it is highly unlikely that would be the case, but even if it is, Evolve is trading at a discount to NAV.

I have bought a lot of shares in Astaire on the basis that, after the rubbish has been cleared out and the case settled, it will be worth much more than the current 0.5p per share - perhaps as much as 2.5p per share. I am considering buying shares in Evolve (shame about the huge spread), as it an even better low risk play on Astaire, with the cushion of all the other investments to minimise the downside.

[xcap] 13/1/2011 11:45

thats what I thought acq, could it be the legal proceedings in the background are holding things back, any idea what that's about and how likley its going to impact on the company ie compensation damages etc

[acquisitor] 12/1/2011 22:31

Even if you assume that the Astaire stake is worthless (it should be worth £600k based on the current market price), this is trading at a significant discount to net asset value. The quoted stakes must be worth £2m on their own, plus the value of the unquoted ones. All for a market cap of £1.4m. Sadly, this is the norm for a number of illiquid AIM companies.

[xcap] 11/1/2011 18:39

thanks Acq. I do like EVOL however I think I would like to know a little more about the lawssuits first.

[acquisitor] 11/1/2011 17:15

xcap

Indirectly, they do have the right, but they may have to contend with the barriers that result from being a majority shareholder of a plc. I don't think the cash actually exists, as some of it has been passed on to the new owners of the businesses they have sold. A lump of it was probably regulatory capital.

I would love to know how much capital Astaire actually has now, and how much it will have after the sale of Rowan Dartington. Some of the Astaire proceeds have been ring-fenced pending a lawsuit and I'm sure there will have been some hefty payoffs to get rid of senior people.

[xcap] 10/1/2011 10:41

Acq, was looking at EVOL. Not an accountant but if Astaire is a sub of Evol and Evol has controlling interest does it not have a right to call on the cash. I like EVOL because at least the BofD are trying to enchance value for shareholders and are very open about this and appear to transparent

[acquisitor] 29/10/2010 10:17

As someone who has just bought into both Evolve and Astaire, I would caution holders of the former when considering how much cash it really has. As the latter is a subsidiary of the former, the Astaire "cash" are consolidated into Evolve's results. As we know, Astaire has piddled away millions in cash and other assets over the years and actually has nowhere near that level today, having sold off Astaire Securities.

Although I do think Evolve is a good investment, it is nowhere near as good as the historic results show.

[solaking] 28/10/2010 14:16

RNS Number : 4758T
Evolve Capital PLC
29 September 2010
29 September 2010
Evolve Capital plc
("Evolve" or the "Company")
Interim Results for the six months ended 30 June 2010
Evolve Capital Plc today announces its interim results for the six months ended 30 June 2010 which incorporate the results for its principal operating subsidiary, Astaire Group Plc.
For further information please contact:
Evolve Capital plc
Oliver Vaughan, Chairman
Tel: [phone]
Allenby Capital Limited
Nick Naylor
Nick Athanas
Tel: [phone]
Chairman's Statement
I am pleased to report to you on developments within the Company during the six months to 30 June 2010. A summary of the financial performance of the Group can be found at the end of this statement.
When Evolve was formed in 2007 its stated strategy was to invest in promising companies that were either already on the PLUS market or who were seeking to join the PLUS market. The Company raised an initial £4 million to enable it to prove the viability of this strategy.
In December 2008 the Company launched a hostile bid for an AIM listed company, Astaire Group Plc, known then as Blue Oar Plc. The rationale was twofold; firstly to stop what appeared to be the inevitable destruction of a fundamentally sound company that was well known to the Evolve directors, and secondly as a means to bolster the investment funds available to Evolve in pursuit of its stated strategy. Evolve's bid was successful; however the litany of structural and regulatory issues that had been built up under the stewardship of that company's previous management prevented our objectives from being achieved. They also drew Evolve into what has come to be recognised as a deeply unhappy episode. Earlier this year steps were taken to separate the management of the two companies and as a part of this exercise James Noble and Chris Roberts resigned from the Evolve Board. It is a matter of public record that the Board of Astaire are continuing to review various options to revive the fortunes of that group and Evolve's Board will be supportive of whichever route enables the greatest preservation of its shareholders' value.
To add to the challenges associated with this investment, a former client of Astaire Securities Plc initiated proceedings against the company and included Edward Vandyk, one of Evolve's directors, as a party to the action. In order for him to focus on the vigorous defence of this action, Edward Vandyk stepped off the Board of Evolve with effect from 26 May 2010 and has no ongoing involvement in its day to day affairs.
On a more positive note a number of Evolve's PLUS-quoted investments have performed well and since the period end, the Company has successfully raised additional funds; in part through the disposal of a part of its investment in unquoted Aconite Technology Limited, but principally through a fully underwritten open offer to shareholders, which completed on 8 September and was encouragingly well supported by shareholders. The funds raised from the open offer have provided the Company with additional working capital and will allow it to provide further funds to existing investments and possibly to invest in new opportunities. Further details on Evolve's investments can be found below.
On 23 August 2010 a small group of shareholders, who at the time held 5.8% of the Company's issued share capital, requisitioned a General Meeting of the Company to remove me as Chairman. At the time of the requisition no explanations were provided and no alternative candidate proposed. It has subsequently become apparent that these shareholders were expressing unhappiness with the Astaire situation and that they felt that the Board of Evolve were failing to communicate adequately with shareholders about the Company's strategy and the status of the companies in which it has invested. The resolution was put to shareholders at a General Meeting held on the 28 September 2010 and was duly defeated, nevertheless the Board has determined that communication with shareholders will be improved going forward.
Evolve is now getting back to its roots as an investment company and as such it is once again looking to make investments in quoted companies and unquoted companies that are looking to join the PLUS market or move from PLUS to the AIM market.
OPERATIONS
Astaire Group Plc
Astaire Group Plc has two principal trading businesses, Astaire Securities Plc which is an institutional stockbroker, corporate financial advisor and AIM Nominated adviser, and Rowan Dartington & Co. Ltd which is an established private client stockbroker based in the South and West of England.
During the period, Astaire Group has received, from lawyers acting on behalf of Izodia Plc, service of a Claim Form and Particulars of Claim filed with the High Court, claiming compensation of approximately £4 million plus interest and costs in respect of alleged events which occurred in 2002.
The Astaire Group Board are currently reviewing a number of strategic options to revive the fortunes of the group and Evolve is keen to ensure that everything is done to preserve the value of its holding in this group. This has proved to be a particularly unsuccessful investment to date on a number of levels and one for which I and my colleagues apologise wholeheartedly to all shareholders in the Company.
St Helens Capital Partners LLP ("St Helens"),
Evolve's wholly owned subsidiary St Helens continues to be the largest Corporate Adviser to PLUS-quoted companies, by number of retained clients. In May 2010 the business once again won the award as PLUS Adviser of the Year, a commendable achievement, and the staff at St Helens are to be congratulated for their continued commitment to the development of this small cap market.
Despite the inevitable restriction that the financial crisis has placed on the number of viable corporate transactions, St Helens has in recent months succeeded in floating two new companies on the PLUS-quoted market and its clients have raised more than £1.7 million of new capital. The business continues to trade in a satisfactory manner and the Board of Evolve is confident that it will flourish as financial conditions improve.
UPDATE ON INVESTMENTS
Aconite Technology Limited ("Aconite")
Aconite is a private company that has developed and is marketing a suite of open platform software products that enable the issuers of credit cards and other plastic payment cards to migrate to the new EMV industry standard (chip and pin) cards without the need to replace their existing infrastructure. Aconite's software also enables card issuers to issue and manage pre-paid debit cards and contactless payment cards and the company has won a number of contracts in the mass transit arena. In the latter part of 2009 the financial crisis caused potential customers to delay the signing of new contracts and this placed a considerable strain on the company's cash resources. As a matter of prudence Evolve wrote down the value of its holding in the company to £200,000. Since that time the company has signed a number of new contracts and its prospects have improved significantly.
In July 2010 Evolve sold 275,000 shares in Aconite to Elderstreet Investments for £250,000 in cash, which generated a profit after expenses of £134,500 over the written down value of the shares. One of Evolve's Directors, Michael Jackson, is also a director of and a shareholder in Elderstreet and as a consequence this transaction was classified as a related party transaction under the AIM Rules for Companies and the Companies Act 2006 and was approved by shareholders.
Bluehone Plc ("Bluehone")
Bluehone was established in 2005 and specialises in managing funds focused on investing in small companies. Its executive directors previously worked together at F&C Asset Management and F&C is an investor in the business. Evolve acquired a 19.9% stake in Bluehone through investing £386,763.
Pulse Group Plc ("Pulse")
Pulse is a leading provider of research process outsourcing in the Asia Pacific region and services market research companies based throughout the world. In recent months both the company and its chief executive, Bob Chua, have won a number of awards for excellence and have generated a considerable volume of positive coverage in the local Asian Pacific press. However, the company remains relatively small in size and needs to expand in order to realise its full potential. Evolve initially invested £500,000 in the ordinary share capital of the company in June 2008 at the time of its admission to the PLUS-quoted market. Since then, Evolve has reduced its holding in the company through a series of disposals, and following a fall in share price the remaining holding is carried at its fair value of £38,759.
Woodspeen Training Plc ("Woodspeen")
Woodspeen is a training company addressing the government funded vocational training sector, with a specific focus on the Learn Direct, Train to Gain and NVQ programmes. Woodspeen is run by three former main board directors from BPP, a fully listed company that is one of the UK's leading professional training companies. The company joined the PLUS-quoted market in March 2008, has made three acquisitions to date and is trading profitably. At 30 June 2010 Evolve's holding is valued at £1,071,000, representing a notional gain of £621,000.
3D Diagnostic Imaging plc ("3D")
3D's wholly owned subsidiary, CarieScan Limited, has completed the development of and is marketing a hand held, simple to use, highly accurate device for the early detection and monitoring of dental caries (tooth decay). In June 2010 the company signed a transformational distribution agreement with Patterson Dental, one of the largest distributors of dental equipment in the USA with annual turnover of some $2 billion. The USA is thought to be one of the largest markets for the company's products in the world. The company has begun shipment of product to Patterson, and this marks the beginning of the commercialisation of its product.
Evolve has to date made a total investment in the ordinary share capital of 3D of £839,925, and the holding had a fair value of £5,299,000 at 30 June 2010.
Since the period end, 3D has announced the raising of £745,000 of additional capital through the issue of unsecured convertible loan notes with an interest coupon of 5% per annum. Evolve participated in this funding round so in addition to its equity holding, it now also holds £350,000 of unsecured convertible loan notes with an interest coupon of 5% per annum, which will convert automatically upon an admission of 3D to AIM at the lower of 15p and a price that is a 25% discount to the price at which any IPO funds are raised. This takes the total cost of investment by Evolve in 3D to £1,189,925 at the date of these interim financial statements.
The table below summarises the key investments held at 30 June 2010 and their valuations in these interim financial statements:


Investment

Market
Shares held by Evolve

Classification

Cost Fair Value at 30 June 2010 Closing bid price at 27 September 2010

Aconite Technology Ltd
Private
476,190
AFS
£500,000
£200,000
Unquoted
Bluehone Holdings Plc
PLUS 23,615,411
AFS
£386,763
£501,827
2.5p
Pulse Group Plc
PLUS 6,079,888
AFS
£328,595
£38,759
0.75p
Woodspeen Training Plc
PLUS 3,000,000
AFS
£450,000
£1,071,000
33p
3D Diagnostic Imaging Plc
PLUS 44,529,911
FVTPL
£839,925
£5,299,059
14p
Fair value of the PLUS quoted investments is calculated based on the bid price of the shares quoted on PLUS less a 15% discount to reflect the relative illiquidity of the holdings concerned. At this time the Board of Evolve do not believe that these fair values could be achieved on in a short term realisation of these investments.
Evolve Capital Plc also owns 53.61 per cent. of the issued share capital of Astaire Group Plc, which has a carrying value of £2,748,000 in the Company balance sheet.
RESULTS
The Group generated a loss after taxation of £864,000 compared with a profit after tax for the six months ended 30 June 2009 of £1,497,000, and these are explained in more detail in the Financial Review.
During the period under review the Board has taken significant steps to reduce the Company's overhead base, but this is of course minimal in comparison to the losses generated by Astaire Group Plc which are consolidated in full within these results.
At 30 June 2010 the Group has consolidated net current assets of £15.2 million, compared with £14.8 million at 31 December 2009 and £17.7 million at 30 June 2009. Cash balances were £5.5 million at 30 June 2010, compared with £7.9 million at 31 December 2009 and £10.5 million at 30 June 2009. Of these cash balances £5.6 million at 30 June 2010 were held within Astaire Group plc and not available to Evolve. Cash per share at 30 June 2009 was 3.07 pence compared to 4.42 pence at 31 December 2009.
Once again I would urge a note of caution because within the Group's cash balances at 30 June 2010 were £5.6 million held with the Astaire group and not available to Evolve.
During the coming months we intend to focus on our core strategy and I look forward to advising you of further progress in due course.
Oliver Vaughan
Executive Chairman
29 September 2010
FINANCIAL REVIEW
Result before tax
The result for the first six months of 2010 was a loss before taxation of £1,073,000 compared to a profit of £1,809,000 for the same period in 2009.
Income statement
The consolidated results for the period relate to the trading activities of the Astaire Group, which is 53% owned by Evolve and therefore fully consolidated in these Interim results, the wholly owned PLUS adviser St Helens Capital Partners LLP and Evolve Capital Plc's other investment activities. The Astaire Group contributed 96 per cent. of Evolve's consolidated total income.
The consolidated results include net unrealised gains on fair value through profit and loss (FVTPL) investments of £1,846,000 (30 June 2009: gain of £1,567,000). The gain in FVTPL investments includes a £2,271,000 gain related to an increase in the market value of Evolve's holding in 3D Diagnostic Imaging Plc and a £425,000 loss from investments held by Astaire Group.
Taxation
The tax credit for the period of £209,000 (30 June 2009: charge of £312,000) reflects deferred tax on movements in the value of investments and other intangible assets .
Earnings per share
The basic loss per share from continuing operations was 0.48 pence per share (2009: earnings of 0.93 pence per share). As there are no options or other dilutive instruments in issue fully diluted earnings per share are the same as basic earnings per share.
Balance sheet
At 31 December 2009, the carrying value of goodwill in the balance sheet was £1,400,000, however with the difficulties facing the Astaire Group (to which much of this goodwill relates) the Board resolved to book impairment provisions of £1,101,000 against this. A small impairment provision of £207,000 was also taken against the value of other intangibles.
As noted above the other significant movement affecting the balance sheet was the increase in the carrying value of FVTPL investments since 31 December 2009 by £1,625,000, which is related to the increase in market value of 3D Diagnostics, offset by some adverse movements in FVTPL investments in the Astaire Group.
At 30 June 2010 the consolidated Evolve Group held net cash balances of £5.5 million, a reduction of £2.4 million from 31 December 2009. This movement is almost wholly due to reduced cash balances in Astaire Group. Evolve itself utilised a short term overdraft facility which was repaid after the period end from the proceeds of the share and loan note issue.
Going concern
The Group has adequate cash resources and a short term overdraft facility. In addition, as more fully explained in note 5, after the period end, the Company raised new equity and loan capital of £1 million before expenses, by the issue of new shares and loan notes.
As a result of such considerations, the Directors have a reasonable expectation at the time of approving the interim financial statements that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the interim financial statements.
Oliver Vaughan
Executive Chairman
29 September 2010

[solaking] 28/10/2010 14:09

welshgoat2,
i am reading their interim report to 30th june 2010.
i wish 3D was the only investment they have, that would have been fantastic, but it is not. other investments seems to be making them a loss, so one has to weigh up the ration of the gains they making from the investments that are working well for them against those that are not working and see what the net value comes up to.
i will post a section of it in the next post now just for a quick view of others interested.
cheers, SK.

[welshgoat2] 28/10/2010 13:45

i hold sres and bhr m8, this is low risk winner m8. cant go wrong here imo.

[safman] 28/10/2010 13:45

Background to and reasons for the Fundraising

At the time of its admission to AIM in December 2007, Evolve raised approximately £4,000,000 (before costs) to enable it to cover its working capital requirements and to invest in companies already on the PLUS-quoted market or seeking to join the PLUS-quoted market.

Since that time the Company has fully utilised its cash resources and has invested in one unlisted company, four companies that have been admitted to the PLUS-quoted market and has acquired a controlling stake in AIM listed Astaire Group plc.



saffy..

[solaking] 28/10/2010 13:44

welshgoat2,
thanks for all your effort and response. so i take it that EVOL is an investment vehicle business. I will see how i can quickly raise capital and tuck it in here.
do you by any chance know any other investments they have at the moment?
also why are they sitting on that kind amount of cash instaed of putting it to use?
what other stock do you hold/ and are you looking into f you don't mind me asking?
thanks and i appreciate your time with me here.
cheers, SK.

[welshgoat2] 28/10/2010 13:38

"The Board believe that 3D is an excellent example of Evolve's wider business
model. We have supported the company from the outset and are delighted with the
progress that it has made to date. We look forward to further exciting
developments in the future."

[solaking] 28/10/2010 13:32

so with the enlarge issue share is: 170.5m shares
EVOL holds 53,974,354 shares of 3D (31.66%)

@placing price 3D is worth £10.23 million
@yesterday's closing price 3D is worth £17.05 million

@placing price EVOL holdings in 3D is worth £3.2385 million
@yesterday's closing price of 3D, EVOL holdings is worth £5.397 million (which comes to 1.408p per share if 3D shares is the only asset that EVOL has)

all looks good without rto; but the rto thing, where does that come up/in? i still can't see anything that shows a potential of rto. is with 3D or another business that EVOL is going to do an rto? please take no offence, i just want to understand and see the potential of the rto thing.
cheers, SK.

[welshgoat2] 28/10/2010 13:19

soalaking, 3d coming to market mkt cap £10m we hold 31.66%, that 3.16m, plus we have £7.5m in cash, unervalued is understatment.