City round-up: Accrol; SysGroup; Real Good Food; Genedrive; OTAQ


Accrol, the AIM-listed Blackburn-based tissue and toilet roll maker, said it is in line to deliver full year forecasts, at least in line with market expectations.

In a trading update this morning for the six months to October 31, 2022, the group said revenues were up 64% to £121.1m, with volumes increasing by 14% in the period.

Accrol’s market share by volume increased further to around 21.5% (FY22: 19.5%), compared with a flat overall UK market.

As announced in the group’s final results for 2022 in September, private label volumes are now higher than pre-pandemic levels – market share is growing at an unprecedented rate against that of the traditional brands.

It also said the private label sector has strengthened further since the final results and Accrol volumes have continued to grow ahead of the overall UK market, with private label market share standing at around 46%, compared with 44% last year.

Net debt at October 31, 2022, was lower than anticipated at circa £30.5m, despite a significant increase in tissue stocks as the group continued to manage uncertainty in its supply chains and the effect of strikes at UK ports.

The group expects this working capital position to improve in the second half of fiscal year 2023 to deliver a further reduction in its net debt position ahead of current market expectations for the year, which are revenue of £213.5m, adjusted EBITDA of £15m, adjusted pre-tax profits of £7.1m and net debt of £26.3m.

Gareth Jenkins, chief executive, said: “We are clearly very pleased with these set of results where we have seen volume growth of 14% against a flat overall UK market performance over the same period.

“We have delivered this by having great quality and value products that meet every consumer’s budget. Our strong relationship with the retailers and our robust supply model is ensuring we can continue to deliver a strong set of results in a difficult market environment.”


Adam Binks

SysGroup, the Liverpool-based Cloud hosting provider, boosted first half turnover by 49%, but slipped to a loss in the six months to September 30, 2022.

The business achieved revenues of £11.32m, against £7.58% the previous year. It’s pre-tax loss of £190,000 compared with a pre-tax profit of £250,000 in the same period a year ago.

Net debt stood at £1.92m, excluding £2.94m of contingent consideration relating to the acquisition of Truststream. At the same point last year the group had net cash of £1.96m.

The group completed its first two acquisitions since 2019 as M&A difficulties caused by the pandemic and lockdowns eased. It added Truststream Security Solutions in a deal worth up to £7.9m, enhancing its cyber security offering and adding and Edinburgh location. And it acquired Orchard Computers for £1m in cash, strengthening South West operations. Both acquisitions were immediately earnings enhancing and integration is largely completed as a result of Project Fusion.

With these latest acquisitions SysGroup now operates in six locations across the UK, in Liverpool, Manchester, Newport, Bristol, Edinburgh, and London.

SysGroup says there is further potential for cross selling and client growth going forward as it continues to monitor and assess acquisition opportunities.

The board said it remains confident that trading for the current financial year will be in line with its expectations.

Chief executive, Adam Binks, Chief Executive Officer, said: “I am pleased to deliver results in line with expectations as the group benefits from the operational investments and improvements that have been made over prior periods. Technology can help businesses improve efficiency and protect margins, which is increasingly relevant when set against the current economic backdrop.

“The two acquisitions made in the period have strengthened our offering even further and added more great team members to the group. Additionally, they have both brought a base of customers which we can service better from our enhanced footprint which now covers the whole of Great Britain. As well as being earnings enhancing, they are further evidence of our ambition to continue to be a consolidator in this highly fragmented market.”


Real Good Food Group

Liverpool-based baking ingredients group, Real Good Food, has secured an additional £2.5m in funding to support its turnaround. This is further to the trading update issued on September 30, 2022, in which the group indicated it was in advanced discussions to secure additional funding.

The new funding is being provided by Hilco Private Capital for a term of 12 months and supplements the existing £6.3m facility with Leumi ABL.

As a consequence, no new Loan Notes will be issued. The funding ranks behind the existing Leumi ABL facility and ahead of the Loan Notes in security. The blended interest rate for third party funding is expected to be 12.1%, based on current market rates.

Mike Holt, executive chairman, said: “We are delighted that new funding has been secured to support the radical reform of RGF which is intended to reduce costs, protect revenues and preserve the inherent value of the group. With support from both customers and employees, we are making good progress on the required reforms and several major customers have already agreed to significant price re-sets. We are confident that the right actions are being put in place to return the business to sustainable profitability and being cash generative.”

He added: “I am particularly pleased that Leumi ABL continues to support the group and that Hilco has provided the new funds required. I would also like to thank our suppliers for their forbearance over recent months pending this funding being secured.”

Last month the group announced that a ‘radical reform’ to significantly reduce overhead costs had been signed off.

The changes follow another challenging year for the company, which supplies cake ingredients and decorations to customers across the world.


David Budd

Manchester molecular testing business, Genedrive, saw revenues fall and losses increase in the year to June 30, 2022, but said it had made good progress.

Turnover of £50,000 was lower than the previous year’s £690,000 level. The loss for the year was £4.7m, against £700,000 in 2021. The R&D spend was £3.9m, down from £4.5m a year ago.

However, the business said it is debt free and has cash at bank of £4.6m, up from £2.6m last year.

During the year the business achieved its first NHS deployments and sales of the Genedrive System for Antibiotic Induced Hearing Loss at Manchester Hospitals, and launched its second generation Genedrive system to support strategy focus of assay development to emergency care settings.

Chief executive, David Budd, said: “The company has made good progress on advancing our strategy in pharmacogenetics, and the opportunity to be leaders in the establishment of genetic testing in acute point of care.

“Our Genedrive system delivers unambiguous clinically actionable information on the wards by nurses with no previous experience in molecular testing, making a positive impact on health outcomes. Market development and engagement is positive and growing, as we have unique products with a positive health economic and clinical outcome.”


OTAQ, the Lancaster-based marine technology group, has appointed Adam Reynolds as non-executive chairman with immediate effect.

The company also announces that Alex Hambro will retire as non-executive chairman at the same time.

Alex has made a significant contribution to the company since joining the board in November 2018, and becoming non-executive chairman on admission to the London Stock Exchange in March 2020. The board thanks Alex for his valuable contribution to the company’s development.

Adam is a veteran of the small cap market and a champion of growth companies. He brings with him a wealth of knowledge and experience across various sectors and helps companies realise their potential.

He began his career in the City in 1980 with stockbrokers Rowe Rudd, following which he joined public relations business Basham & Coyle heading their investor relations division. Thereafter he established his own PR/IR and corporate finance firm, which he subsequently floated on AIM in 2000, before selling the company in 2004.

More recently, Adam has been a major investor in and non-executive chairman or non-executive director of a number of small cap growth companies including EKF Diagnostics, Manchester-based Sosander, Yourgene Health, also based in Manchester, and Belluscura where he works closely with the executives to take advantage of the opportunities available thereby maximising shareholder value.

Alex Hambro said: “Adam has plenty of relevant experience in guiding young technology-based companies through their international growth opportunities. OTAQ’s exciting current portfolio of new products has significant growth potential internationally and Adam will add enormous value to these programmes.”

Adam Reynolds said: “I am very pleased to be joining the board of OTAQ at this pivotal point of its development and the growth opportunities it has before it. I would like to thank Alex for his contribution over the past four years and I wish him well.”

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