Thursday February 14th 2019

Thursday February 14th 2019

Red Paddle £11.3m | Michelmersh £30.1m | Hometree | Keywords Studios £79.1m | Kainos £76.6m | Microgen £43m

News about 6 UK growth companies and/or accelerators + turnover in the GRID marketplace 25th June – 2nd July 2017:

RED PADDLE: We caught the wave with inflatable boards | Laura Onita, The Sunday Times. June 25
DZ profile: Red Paddle Co Limited
Business: Its paddle boards and other equipment are made in China and have been sold in more than 60 countries.
Launched: 2008
Location: Based in the Devon village of Halwell
Founder: John Hibbard, 40, co-founder. After nearly three decades of riding the waves around the world, windsurfing champion John Hibbard hung up his wetsuit in 2008 to become an entrepreneur. His friends had taken up stand-up paddleboarding — in which riders stand on boards and use a canoe-style paddle to propel themselves over the water — but Hibbard found the equipment cumbersome. He teamed up with Roger Tushingham, a former international dinghy racer who had sponsored him, and Olympic windsurfer David Hackford to set up Red Paddle Co, selling inflatable boards and accessories.
Staff: 30
Financials: posted pre-tax profits of £914,000 on sales of £11.3m last year.
Investment: In 2015, the founders raised £4m from MOBEUS EQUITY PARTNERS in return for a minority stake.
News: The (investment) cash helped Red Paddle lift exports to £5.7m last year, earning it a place on the latest Sunday Times Export Track 100 list of companies with the fastest-growing international sales.

MICHELMERSH: Aim-listed brick manufacturer share price soars after buying rival Carlton Main Brickworks in £31m deal | Shruti Tripathi Chopra, City A.M. June 26.
DZ profile: Michelmersh Brick Holdings Plc
Business: brick maker
Launched: 1997
Location: Haywards Heath, Sussex
Staff: Frank Hanna, Joint CEO
Financials:  revenues £30.1m and pre-tax profit £4.6m to 31Dec 2016
Investment: Aim-listed. Admission to trading 26 May 2004
News: Michelmersh's shares rose 11 per cent this morning after the announced it has acquired its Yorkshire-based rival CARLTON MAIN BRICKWORKS in a £31.2m deal. The addition of Carlton is expected to increase Michelmersh’s output to over 100m bricks per annum, an expected increase of over 40 per cent to Michelmersh’s current output. Carlton currently manufactures up to 37m wirecut bricks per annum. In the 12 months ended 31 March 2016, Carlton made an audited profit before tax of £2.62m on turnover of £13.1m.

HOMETREE: London tech firm takes on energy giants | Jamie Nimmo, The Evening Standard. June 28.
DZ profile: Hometree Marketplace Limited
Business: has set its sights on shaking up the Big Six as it hopes to become the energy market’s answer to Purplebricks. It will initially provide a boiler installation service for a fixed fee and through an app that will allow users to video call experts for advice on their boilers before branching out into other energy-efficiency services and products.
Launched: 2015
Location: London
Founder: Simon Phelan, who worked with Moulton at his private-equity firm Better Capital.
Investment: has raised £1.9 million from some of the UK’s biggest technology investors, including Saul Klein’s LOCALGLOBE, which has invested in Cambridge artificial intelligence start-up IMPROBABLE, and DN CAPITAL, which has backed hybrid estate agent PURPLEBRICKS. It also has impressive backers, including private-equity tycoon Jon Moulton and Ian Marchant, the former boss of energy giant SSE.

Small-cap focus: IT service groups haul businesses into digital age | Aliya Ram, FT. July 1.

KEYWORDS STUDIOS
DZ profile: Keywords International Ltd.
Business: typical IT services company ….works for the video gaming industry to develop more technologically advanced games. This means it acts like an outsourced producer for augmented and virtual reality, testing and providing support once games go live. has attracted 21 of the largest 25 video game publishers as clients, including ELECTRONIC ARTS, ACTIVISION BLIZZARD, TENCENT, KONAMI, SONY and UBISOFT. It has also worked with OCULUS and GOOGLE.
Launched: 1998
Location: Dublin, Ireland
Staff: Its more than 1,500 employees translate stories into different languages and make sure they are culturally adapted for players around the world.
Financials: Pre-tax profits rose 85 per cent to €9.4m (£7.7m; Revenues £79.1m) in the year to December 31 2016.
Investment: Listing/Admission to trading on AIM, London Stock Exchange, 12 Jul 2013. The company’s share price has almost doubled from the 2013 float price, to £2.67.
News: The group last year bought MINDWALK for $5.5m, giving it access to the rapidly growing Chinese market.

KAINOS
DZ profile: Kainos Group Plc
Business: has developed technologies specifically designed to make it easier for government departments to share information and plan work. The company has targeted sprawling institutions with large volumes of data, capturing clients such as NHS trusts, the UK’s PRISON AND PROBATION SERVICE and the LAND REGISTRY — as well as hospitals in the US. …has seen its shares more than double to £2.68 over the past year as the UK government pushes a so-called “digital transformation programme” to update its technology.
Location: Belfast
Staff: just under 1,000 staff. Chief executive Brendan Mooney
Financials: Revenue £76.6m and pre-tax profit £14.3m to 31-Mar-16
Investment: floated in the UK in July 2015. London Stock Exchange, Main Market.
News:

1. ….its specific focus on British public bodies has made it vulnerable to central government policy and funding, with its most recent annual report blaming the NHS’s squeezed budget for a 12 per decline in its electronic medical records division. The group is expanding into other countries to offset this challenge.

UPDATE:
‘Govtech’ spurs smaller UK IT companies | Aliya Ram, FT. November 23, 2018

2.According to an analysis of the UK government’s digital marketplace — an online procurement platform for tech projects in government — by TechMarketView, it was the second biggest supplier. ...attracted £46.2m of spending in the seven months to July 31 this year, putting it ahead of AMAZON WEB SERVICES, MCKINSEY and DELOITTE and behind only CAPGEMINI, the technology outsourcer. With software designed to make it easier for government departments to share information and plan work, Kainos has grown, as public bodies push to make better use of their data.

3. Over the past year, the business has opened offices in Birmingham, Frankfurt and Copenhagen.

MICROGEN
DZ profile: Microgen Plc
Business: provides accounting software for companies …over the past year, has refocused on two core businesses: financial management software, and IT systems for trust and fund companies to speed up their operations. Microgen says it is benefiting from increased regulation, which has made business more complicated for trust and fund administrators globally and created an opportunity for technology to simplify operations. But with significant competition coming from overseas providers based in countries such as India, where IT systems can be managed at a much lower cost, it has yet to return to its former success.
Launched: 1974
Location: London EC4
Financials: In the 12 months to December 31 2016 the group reported profits of £7.9m — up two-thirds on the previous year – on £42.99m revenues
Investment: Listing/Admission to trading on the London Stock Exchange in May 1984. Main Market.

UPDATE:
‘Govtech’ spurs smaller UK IT companies | Aliya Ram, FT. November 23, 2018
1. ...after a management shake-up two years ago, the share price has more than tripled to £4.08, as the company simplified the divisional structure of its workforce.More recently, Microgen has benefited from changes to accounting rules such as IFRS 16, which comes into effect in January and will require companies to bill most equipment and property leases alongside financial leases on their balance sheets.