Generally speaking, a sharp fall in revenues is never a good sign for any business. While that may be the case for most companies, () was the exception to the rule this week.
The heart valve developer’s share price has added 65% over the past few days to 20p, despite seeing sales fall by almost a third last year.
The silver lining for investors was that AorTech said it is now generating ‘higher quality’ revenues that are recurring and supported by contracts.
“Despite the fall in revenue over the year, the overall quality and maintainability of sales is much better year on year,” said chairman and chief executive Bill Brown.
While the top line may have experienced some short-term pain in the search of long-term gain, the bottom line was much improved thanks to a recent cost-cutting drive.
AorTech is still embroiled in a long-running dispute with its former boss but even that couldn’t dampen investors’ spirits.
Top spot for the week went to YOLO Leisure and Technology PLC (LON:YOLO) though, which leapt higher after reporting that a company it has sizeable stake in has launched a music streaming service that will rival , Amazon and Music.
That’s a big claim but it was music to investors’ ears, with YOLO shares up 67% to 0.7p.
The tech and leisure investor has a 41.43% interest in Magic Media – A.K.A Electric Jukebox – which has just launched ROXI, a “family-centric” music streaming service that provides the “ultimate music entertainment experience”.
It’s more than just a few buzzwords wrapped up in a pretty box though, ROXI has licensing agreements in place with the three major record labels – Universal, and Warner, as well as other independents and major publishers.
ROXI can now be found in stores both in the US and in the UK, including in Selfridges, and YOLO reckons that opens the product up to a combined market of more than 40mln homes.
At the other end of the spectrum, Limited () was one of the worst performers on the junior market this week after it gave investors a two-for-one offer that they really didn’t want.
The company’s nominated advisor, Beaumont Cornish, handed in its notice last month which left Nyota with four weeks in which to get another Nomad – which every AIM firm must have – on board.
Nyota came out on Tuesday and said that, although it’s in discussions with another Nomad, it wouldn’t be able to appoint a replacement before the 17 August deadline.
That resulted in the shares being suspended on Thursday and it now has less than four weeks to appoint a new Nomad otherwise its AIM shares will be cancelled from trading altogether.
If that wasn’t enough for weary investors, Nyota revealed in the same statement that it was looking to raise money through a share placing at a “substantial discount” to the current price.
That led to a mass sell-off in the shares, which ended the week 43% down at 0.01p (and that’s rounded up).
Also down in the doldrums was marketing and brand consultancy , which slumped by more than a quarter on the back of a profit warning to 580p.
The company, which used to be called Brainjuicer, blamed a slow start to the year and higher costs as it said first half gross profits – its “main top line performance indicator” – would be up to 11% lower than the prior year.
System1 chairman Ken Ford also told shareholders at the group’s AGM on Friday that he expects first half pre-tax profits to be a little over breakeven compared to a healthy £2.8mln profit last time around.
Even though he expects a better performance in the second half, Ford conceded that full-year pre-tax profits would be around 10-15% down on the £6.3mln System1 posted in 2016.
Generally speaking though, it’s been a solid week for AIM stocks, with the junior market adding almost 1%, or 9.6 points, over the five trading days to sit at 998.7 come Friday afternoon.
That was enough to score a victory over the blue chips which have struggled as the pound has come under pressure, with the FTSE 100 ending the week where it started it (broadly speaking) at 7,316.
PLC () was one of those helping the junior market higher this week after it dangled out a line on new store openings.
The fishing tackle retailer said on Monday that it had opened a ‘destination store’ – or ‘big shop’ to you and me – in Gloucester over the weekend.
That’s now six stores opened so far in 2017 and Fishing republic said a seventh, in Cambridgeshire, is on track to open to the public later this month. Investors took the expansion bait, with shares up 17% to 39.5p come Friday afternoon.
A quick word on Telit Communications to wrap up.
Last week, the Internet of Things enabler hired a law firm to take a look into the past of its chief executive Oozi Cats amid reports that he had been on the run from US law enforcement since the early ‘90s.
Well it didn’t take them to find out that Oozi and his wife were indeed the Uzi and Ruth Katz named in Boston court papers from 1992.
Cats (or is it Katz?) resigned with immediate effect on Monday after Telit said he had “knowingly withheld” the indictment from the company.
“It is a source of considerable anger to the board that the historical indictment against Oozi Cats was never disclosed to them or previous members of the board,” read Telit’s statement.
Life as an AIM investor may be a rollercoaster, but it’s certainly not dull.