Shares in Scottish AIM companies rose by 2.57 per cent in 2015

There were 25 Scottish AIM listed companies for the whole of 2015 (Rangers and Swan) left the market during the year and Cupid changed its name and activities to Castle Street) with a combined market cap of £1529.41m at the end of the year compared with a combined market cap of £1491.09m at the end of 2014.

Although the overall market cap increased during the year this was at a lower percentage than comparable UK markets with the exception of the FTSE all share which fell 2.5 per cent during the year.

The biggest increase occurred in the FTSE AIM UK 50 which rose 18.57 per cent over the year with the FTSE AIM UK 100 just behind at 14.43 per cent up.

The FTSE 250 rose 8.36 per cent with the FTSE AIM ALL share rising 5.25 per cent and the FTSE All share falling 2.5 per cent.

The biggest Scottish increase in market cap occurred at Iomart Group plc which saw its value rise £103.71m to £290.06m.

This puts Iomart, along with Scottish business support company Smart Metering whose value was £283.92m at the end of the year, just outside the top 50 largest AIM listed companies in the UK (The top 50 starts at around the £300m mark).

The company which recorded the largest increase in market cap by percentage was Pinnacle Technology whose value rose 205.5 per cent to £9.95m; followed by Sigma Capital which rose 149 per cent to £83.62m; and Castle Street which had an 83.4 per cent rise to £23.49m.

Unsurprisingly, given the continued uncertainty in the oil and gas sector, the three largest fallers by percentage were an 80.9 per cent drop for Seaenergy to a value of £2.68m; a 73.2 per cent fall for Lansdowne Oil and Gas to £3.63m; and a 56.9 per cent drop for Eland Oil and Gas to £42.49m.

Neil McGill, corporate finance director with BDO, said: “I think this has been a relatively good year for Scottish AIM listed companies. Given the difficult trading conditions for some of the markets such as oil and gas there has been a robust performance from the Scottish AIM portfolio.

“Nine of the 25 companies listed are worth more than £50m and three are worth more than £200m which is indicative of how substantial many of these businesses can become in a relatively short period.

Mr McGill continued: “Some of the issues which have resulted in substantial falls in value are, of course, outwith the control of the management. Oil and gas remains difficult and looks likely to be challenging in the year ahead. Bowleven and Faroe Petroleum, although experiencing falls in market cap of 24.6 per cent and 12.5 per cent respectively, have fared better than others due to balance sheet resilience and well timed deals and remain substantial businesses with values of £72.14m and £144.85m.

“AIM is a valuable and viable market for the right business as can be seen by the positive performances of many Scottish companies during 2015. It can be volatile but then so can all listed markets as the FTSE 100 has proved over the last week and the last year (falling 4.93 per cent).”

Mr McGill concluded: “The key is to make listing work for your business. Historically AIM has attracted certain sectors more than others such as oil and gas and mining so I would welcome a more balanced mix of listed businesses in Scotland. More companies should explore the potential of tapping into external equity markets, whether listed capital or private equity, which remain highly liquid at the moment. Raising equity can support high quality firms to rapid growth and allow them to become the big employers and investors in our economy. There was certainly considerable interest in flotation at the recent London Stock Exchange Scottish Investment Seminar in December.”