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Inside the Market's roundup of some of the Canadian small caps making news and on the move today. This post will be updated through the morning.
Boyd Group Income Fund announced that its wholly owned subsidiary, The Boyd Group (U.S.) Inc., has signed a definitive agreement and concurrently closed the acquisition of Champ's Holding Company LLC.
Champ's is a full-service auto collision repair service provider in southeast Louisiana, owning and operating seven collision repair centers. The acquisition is expected to be immediately accretive to the fund's earnings and cash flow.
The total purchase price of approximately $35-million (U.S.) will be funded through a combination of seller financing and use of Boyd's revolving credit facility.
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Capstone Mining Corp. announced that, due to general market conditions, it is discontinuing its previously announced offering of $300-million senior notes due in 2022.
"The notes offering was intended to opportunistically repay borrowings under our existing credit facilities," explained Darren Pylot, president and CEO of Capstone. "While the $300-million we were looking to raise was available, the proposed interest rate exceeded what we were prepared to pay for that purpose."
"We currently have very low cost credit facilities, which when combined with our strong cash position, strong cash flow from operations and the undrawn portion of our existing credit facilities, give us the flexibility to only consider financing opportunities that are aligned with our cost of capital criteria," continued Mr. Pylot.
Shares in the company are down 2 per cent in early TSX trading.
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Oando Energy Resources Inc., which is focused on oil and gas exploration and production in Nigeria, announced that a wholly-owned subsidiary has filed notice to sell up to 60 million common shares of the company. Oando Energy said its subsidiary believes the stock sale will encourage market liquidity.
Oando is one of the top decliners on the TSX this morning, off by 21 cents, or 12.3 per cent, at $1.49.
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In analyst actions today on Canadian small caps:
RBC Dominion Securities upgraded WesternZagros Resources to "outperform" from "sector perform" but cut its price target to $1.40 (Canadian) from $1.60.
Cormark Securities downgraded Lydian International to "market perform" from "buy" with a price target of $1.05 (Canadian).
National Bank Financial upgraded Rogers Sugar to "sector perform" from "underperfom" with a price target of $4.50 (Canadian).
Macquarie initiated coverage on Pure Gold Mining with an "outperform" rating and price target of 80 cents (Canadian).
TD Securities initiated coverage on Ainsworth Lumber with a "buy" rating and $3.75 (Canadian) price target.
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Arena Minerals Inc. has discovered three additional prospects on the Atacama Copper Property, located in the Antofagasta region of Chile.
Arena has now completed a full year of exploration on the Property, consisting primarily of ground work resulting in the discovery of nine prospects with potential for both copper porphyry style mineralization and/or epithermal gold silver veins. Arena will continue to develop the ACP during the second year of the option agreement.
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Plaza Retail REIT announced the sale of eight former KEYreit properties for $8.2-million. The REIT currently has another 10 assets under conditional sales agreements for total gross proceeds of $14.0-million.
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AlarmForce Industries Inc. has announced results for the three and nine months ended July 31, 2014.
AlarmForce reported net income increased to $5.7-million over the nine months ended July 31, 2014, an increase of 102 per cent over the comparative period of 2013. Diluted income per share increased to $0.49 reflecting a 111 per cent increase from the comparable period of 2013.
Total revenue increased to $39.3-million year to date, an increase of 8 per cent over the comparative period of 2013. Recurring revenue which made up 92 per cent of total revenue grew by 7 per cent to $4.2-million. This was primarily driven by annualized subscriber growth of 4 per cent to 144,400 subscribers and an increase in ending average revenue per subscriber to $28.71 from $27.73 in the comparative period.
Brian D. Pow, analyst with Acumen capital Research, wasn't sounding terribly impressed with the results, but raised his price target to $12.10 (Canadian) from $11.60 based on his new 2015 financial projections. "Results were below our estimates with slower subscriber growth being offset by modestly higher RMR (recurring monthly revenue) and a more disciplined approach to managing expenses. The new cost approach that management has imposed on the company appears to be showing a reasonable trend of bottom line performance. The slower subscriber growth can likely be explained partly by the reduced ad spend as the Company transitions to a more customer focused business model," he said. He maintained a "hold" rating.
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Inscape Corp. announced its first quarter financial results ended July 31, 2014. The first quarter of fiscal year 2015 ended with a net income of $0.8-million or 5 cents per share, compared with a net loss of $1.4-million, or 10 cents per share a year ago.
The current quarter's results included an unrealized derivative gain of $1-million relating to the fair value of outstanding U.S. currency hedge contracts, compared to a loss of $0.8-million a year ago. Excluding these, the current quarter had a pre-tax income of $0.2-million versus last year's pre-tax loss of $1.1-million.
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Southern Silver Exploration Corp. announced a reverse stock split. It also updated investors on its Cerro Las Minitas option agreement.
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Maple Leaf Green World announced plans for a new medical marijuana growing operation in California.
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