SMALL CAP MOVERS: Base Resources soars as it keeps paying divi

Miner Base Resources shot up 32 per cent to 15p this week after it declared a maiden dividend of 35 Australian cents per share.

It is somewhat of a rare breed in the junior market, with companies paying dividends plummeting over the course of 2020 after managers opted to save cash to get through the coronavirus crisis.

In the three months to last June, 64 AIM firms issued a payout, while in the same period last year 145 of them did the same.

The dearth of distributions has been a common theme across the world throughout the pandemic, with global dividends sliding 22 per cent to $382billion in the three months to June, according to research by Janus Henderson published earlier this week.

North America was the only region showing growth thanks to resilience among Canadian companies, while Europe and the UK were hit the hardest.

The whole year may see a decline between 27 per cent or 23 per cent for a total of around $1trillion.

‘A temporary halt in dividends does not change the fundamental value of a company, though it can affect short-term sentiment,’ said Jane Shoemake, investment director at the asset manager.

‘It remains important for income investors to be diversified both by geography and sector.’

Looking at the wider market, the AIM All-Share advanced 0.7 per cent to 963, outperforming the FTSE 100 index, up 0.2 per cent to 6,015.

Among the risers, green energy firm EQTEC rose 25 per cent to 0.6p after reaching financial close for a waste gasification project in Larissa in Greece, the country’s first plant of this kind, with construction expected to begin in September.

Meanwhile, water monitoring company Modern Water climbed 22 per cent to 3p after agreeing a takeover by tech firm Integumen for £21million or 4.05p per share, a 44.6 per cent premium to the previous closing price. The pair have been working together for six months to detect coronavirus in wastewater and sewage.

Elsewhere, 4D pharma jumped 18 per cent to 93p on the back of stunning results in early stage trials for treatment of advanced metastatic renal cell carcinoma or metastatic non-small cell lung cancer. 

The pharma company used its Live Biotherapeutic in combination with Merck & Co’s Keytruda, which ‘far exceeded’ the threshold for success set out before the study began.

In the entertainment sector, Escape Hunt surged 22 per cent to 7p in early deals on Wednesday after its eight UK escape rooms were awarded the ‘Travellers’ Choice Winner’ denomination by TripAdvisor.

Oiler Egdon Resources gushed 21 per cent higher to 2p after completing its farm-in agreement with Shell on two licences in the North Sea.

Turning to the fallers, it was a bad return to AIM for investor Asimilar, which came from suspension 60 per cent lower at 27p after assigning a holding company called MESH its interest and rights to invest in data science and behaviour change firm, Sentiance.

Fellow investment specialist Tanfield slipped 14 per cent to 2p after half-year operating loss widened 62 per cent to £333,000 due to legal fees for its 49 per cent-owned aerial work platforms manufacturer Snorkel.

Software provider Pebble Beach Systems shed 9 per cent to 11p after admitting it will be difficult to convert its pipeline into firm orders as customers are cautious with commitments with large scale projects.

The junior market is set to see a new addition next week – like dividends, another rare event in pandemic times – with digital mental health provider Kooth PLC launching its IPO on 1 September with an expected valuation of £26million.

Its platform provides self-help tools, online moderated forums to connect with peers and online text-chat based professional counselling.

With the pandemic shining a light on the importance of mental wellbeing, Kooth’s float is perhaps set to draw some attention: only on Thursday, World Mental Health Day, the World Health Organisation called for a massive scale-up in investment in the sector.