Scottish AIM shares fell 8.39 per cent in third quarter

The fall was the largest among comparable markets with the FTSE All share falling 6.72 per cent; the FTSE 250 down 5.01 per cent; the FTSE AIM UK 50 down 4.16 per cent; the FTSE AIM All share falling 4.02 per cent; and the FTSE AIM UK 100 down 2.09 per cent.

There were 26 Scottish AIM listed companies in the third quarter of 2015 with a combined market cap of £1526.1m compared with £1665.99m in Q2 2015. Despite this fall the third quarter figure was still higher than the first quarter value of £1510.22.

The biggest increase in share price was experienced by the Iomart Group which increased by 14.1 per cent followed by a 12.8 per cent rise in John Swan and Sons and a 3.4 per cent increase in the Scotgold share price.

The largest faller was Lansdowne Oil and Gas which saw its share price down 68.7 per cent over the third quarter followed by a 59.8 per cent drop for Seaenergy and a 34.2 per cent decline in the price of Superglass shares.

Neil McGill, corporate finance director with BDO, said: “The third quarter has experienced falls in the value of equities as a lack of confidence has hit the markets due to uncertainty over China, the Eurozone and a perception that the growth in the UK economy is priced in. However, although the overall numbers are down this is not as gloomy a situation as it could have been given the market turmoil of the last three months and is due to specific circumstances in some sectors.”

“Iomart is one of AIM’s strongest performers – this is a well-managed business with a strong market position in cloud hosting. A recent strategic acquisition in public cloud consultancy plus reporting first half numbers substantially ahead of last year have underpinned a strong recovery in the shares.”

Mr McGill said: “The fallers in the market are no surprise as two (Lansdowne and Seaenergy) are in the oil and gas sector which continues to face uncertainty with the oil price remaining around the $50 level. Those companies with more robust balance sheets and the ability to trim their cost base to manage cashflow will be better positioned to ride out the next 12-18 months.”

“The firms with smaller market caps and lower liquidity can be more susceptible to market volatility and subject to wider fluctuations in their sector whilst those with the highest market caps are often more secure. The AIM listed firms with the highest market caps in Scotland are Smart Metering at £293.39m; Iomart with £276.73m and Craneware with a market cap of £181.76m. Those with the lowest market cap are Braveheart Investment Group at £2.03m; Seaenergy at £2.61m; and Lansdowne Oil and Gas at £3.02m.”

Mr McGill concluded: “What is interesting is the sectoral shift amongst the highest valued AIM listed firms in Scotland from natural resources towards technology companies. This is understandable at the current point in the cycle. We welcome a more balance mix of listed businesses in Scotland and look forward to seeing more companies tapping external equity markets, whether listed capital or private equity, which remain highly liquid at the moment. For high quality businesses, raising equity can support them to rapid growth and allow them to become the big employers and investors in our economy.”