Investment Matters

Company news: 360 Capital group, Threat Protect and Mermaid Marine

360 Capital Group (TGP.ASX) provided an earnings update, post the completion of the Asia Pacific Data centres (AJD) offer. As a result of now fully deploying its balance sheet, TGP expects its earnings this year to be 5.5cps versus the 3cps prior guidance (+83%). Further, it intends to continue to pay out 100% of its earnings, meaning its distributions will also increase to 5.5cps for the FY-18 year.  Given partial ownership of AJD is expected to be for the long term, this represents a long-term base for earnings going forward.  

We expect TGP to explore options for further growing AJD over coming months, as indicated in its offer document. Further, TGP announced it has continued to build its non-bank lending expertise and experience.  It is currently expecting to develop a listed 1st Mortgage Fund during 2018. Should this be successful, it will further add to earnings, in due course.

Threat Protect (TPS.ASX) announced this week the acquisition of two New South Wales security monitoring companies.  These acquisitions take TPS to 38,000 lines monitored across Australia (8,000 directly, the rest by reseller), and adds $2.7m to annualised revenue. This acquisition is immediately earnings per share accretive and was funded via additional funds provided by a First Samuel convertible note (9% coupon, 3-year term, converting into either shares or cash at a premium) that clients have in their equity portfolios.

Mermaid Marine (MRM.ASX) announced the completion of its Retail entitlement offer.  This (20cps) offer was accepted by only 35% of existing retail shareholders. First Samuel clients benefited by this low take-up via its sub-underwriting of the offer.  We are very happy owners of these quality assets, post the company's refinancing, at (we believe) the low of the oil services industry cycle.