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Standard-listed AIQ: interim numbers - SELL

By Nigel Somerville, the Deputy Sheriff of AIM | Monday 30 July 2018

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

AIQ (AIQ) joined the Standard List in early January and spent most of the first four months of its life suspended due to a disorderly market, had to correct its admission document because it had missed out some information and steps had to be taken to remove some internet references to businesses which, we are told, it had nothing to do with. It was a shambles. This morning it released its interim numbers to April.

When it listed, we were told (and are still told) that it is a simple cash shell and it has no business. Most of its shares were issued at 8p (the IPO price), although a few more were issued later via a placing and open offer at 20p as attempts were made to deal with the false market caused by a lack of liquidity. So in theory, one would assume that its net assets went a little above 8p – before admission costs and other corporate expenses and so on.

But the shares, having peaked at over 130p, are still sitting at 29p in the middle – which seems bizarre for a company with 8 or 9 pence of cash as the only asset. Except that the interims reveal that net assets per share as at the end of April were just 6.9 pence.

If you want to pay 29p for 6.9 pence worth of net assets (cash, minus a few bills) then go ahead, but it is not where I see the road to riches!

I note that directors’ pay (totalling £46,333 for the period) had £32,583 outstanding at period end. I also note that there is an amount due to a director of £275,412 – which seems a bit odd for a company with £3.8 million of cash in the bank. Is this a loan – and if so why? Or is it something else? I think we should be told.

Meanwhile, with just 6.9p of net assets and nothing else all I can say is if you hold the shares then I’d take advantage of the 28p on offer for them. Certainly, at that price, there is absolutely no reason to hold this stock at all. SELL.

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