Technology investor Allied Minds (ALM) fell 3.3% to 22.1p despite narrowing first half losses on an increase in revenue and falling costs.
The group, which specialises in the commercialisation of intellectual property, has had a real fall from grace since reaching record highs above 700p in 2015, however one analyst thinks there are catalysts which could help the shares recover.
For the six months ended 30 June 2021, pre-tax losses narrowed to $1.5 million from $14.8 million year-on-year as revenue increased to $219,000 from $110,000. The company invested $44.9 million in portfolio companies.
'A number of our portfolio companies have made significant progress in the first half, including successful funding rounds, development milestones, contract wins and partnerships with large industry players,' the company said.
POSITIVE ON PORTFOLIO PROSPECTS
'Although the remaining portfolio companies are mostly at a relatively early stage in their lifecycle, the board is positive about their prospects and is increasingly confident of delivering venture capital-like returns upon exit if the portfolio companies continue to meet their planned technical and commercial goals,' it added.
Numis analyst John Karidis said: ‘At a minimum, we think investors should note two key points. First, during 1H FY21, Federated Wireless (FW) and Orbital Sidekick (OSK) progressed from pre-revenue companies to earning fast-growing, recurring and profitable revenues – we estimate FW/OSK make up for 66%/9% of ALM's total portfolio-company NAV (net asset value).
‘Second, we think FW, OSK and BridgeComm (we estimate: 17% of ALM's total portfolio-company NAV) are only months away from financial transactions which will show that, in aggregate, ALM is worth significantly more than our estimate of its NAV (46p), let alone its current share price (23p).’