Mindflair swings to first-half profit

27th Sep 2024 13:05

(Sharecast News) - Mindflair reported a first-half profit of £1.64m on Friday, swinging from a loss of £0.51m in the same period last year, driven by strong performance in its AI-related investment portfolio.

The AIM-traded company's net asset value increased 28% over the six months ended 30 June to £7.49m, equating to 2.7p per share, while its current share price of 0.775p represented a 71% discount to net asset value as of 26 September.

Following the period end, Mindflair raised £0.93m in a placing to further support its investment strategy.

Key portfolio developments included the disposal of Landvault, an investment within SVV1, to Infinite Reality for $450m in an all-share transaction, significantly above its carrying value.

The firm also recorded a profitable exit from its shareholding in Smarttech247 Group.

Additionally, Getvisibility, one of Mindflair's larger direct investments, made notable progress, with its technology being integrated into Forcepoint's security solution for OpenAI's GPT.

Mindflair said it increased its exposure to SVV1, which was now in the realisation phase, and expected more exits following the Landvault transaction.

SVV2, backed by the British Business Bank, had meanwhile made several new investments in innovative AI companies, including PHINXT Robotics, Purple Transform, and Stylus Education, post period end.

Those companies were focussed on areas such as warehouse automation, data analytics for transport safety, and AI-driven educational tools.

"The company has made excellent progress in the first half of 2024 with a significant increase in net assets and further progress with regard to the realisation of investments in its portfolio," said Mindflair director Nicholas Lee.

"In particular, the sale of Landvault for $450m has been completed, and SVV1 now holds shares in Infinite Reality.

"We expect to receive further details with regard to the planned IPO of this company shortly."

Lee said there had also been an "exciting" further development announced regarding Getvisibility's relationship with Forcepoint in connection with data protection across generative AI.

"Furthermore, SVV2 has made a number of new investments in exciting AI companies and Mindflair continues to provide investors with the opportunity to gain exposure to a portfolio of AI focused companies in a sector which continues to thrive and be at the forefront of technology development.

"Post period end, the company increased its investment in Sure Venture in order to increase its exposure to SVV1, which the company expects will make some exciting realisations in the short term, and SVV2 given its exposure to AI."

At 1237 BST, shares in Mindflair were up 9.68% at 0.85p.

Reporting by Josh White for Sharecast.com.