Small Cap Feast

Small Cap Feast – 06 April 2017

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 968

Total number of AIM Companies trading: 943*
* As at 05 March 2017

Set Menu NEX Growth:

Total number of NEX Growth Market Companies (Incl Susp): 84*

Total number of NEX Growth Market Companies trading: 81*
* As at 05 March 2017

Set Menu Standard List:

Total number of Standard List Companies (Incl Susp): *

Total number of Standard List Companies trading: *
* As at 05 March 2017

Dish of the Day:

No AIM Joiners Today

Off the Menu:

No AIM Leavers today

Dish of the Day:

No NEX Growth Market Joiners Today

Off the Menu:

No NEX Growth Market Leavers Today

What’s Cooking in the IPO Kitchen?

EJF Investments— Publication of prospectus from the closed-ended investment company investing in assets benefitting from regulatory and structural change in the financial services sector. To join Specialist Fund Segment of the Main Market

ADES International Holding— Intends to join the Standard List in May raising up to $170m plus a vendor sale.  Provider of offshore and onshore oil and gas drilling and production services in the Middle East and Africa.

Franchise Brands—Schedule 1 detailing £28m reverse takeover of Metro Rod. Admission expected 11 April.

Alpha FX Group— Schedule 1  update from the foreign exchange provider focused on managing exchange rate risk for UK corporates that trade internationally.  Raising £30m.  Expected market cap £64.2m  and admission 7 April.

K3 Capital Group—Schedule 1 update from the Group of business and company sales specialists across business transfer, business brokerage and corporate finance. Raising £2.1m plus £15.7m vendor sale. Admission due 11 April.

Tufton Oceanic Assets– Offer extended to 9 May to enable investors to complete further due diligence.


Breakfast Buffet

Hardide (HDD.L) 1.03p £15.7m

H1 Mar 17 trading update from the developer and provider of advanced surface coating technology. As expected, sales to the Oil & Gas sector have more than doubled and overall trading is comfortably ahead of both the first half and the second half of  last  year. As a result, the Board expects that the trading performance for the full financial year to be in line with market expectations.  The Board is very encouraged by the Company’s recent gain of Airbus Approved Supplier status and is looking forward to completion of discussions with Airbus about the supply of coated components. The Virginia facility is performing very well and activity there is expected to increase in the H2. Management continue to maintain a tight control of the cost base.  FYSep17 rev £3m and £1.3m pre-tax loss.


FreeAgent Hldgs (FREE.L) 116.5p £47.43m

FYMar17 trading update from  provider of cloud-based SaaS accounting software solutions and mobile applications designed specifically for UK micro-businesses. The Board expects to report both revenue and Annualised Committed Monthly Recurring Revenue (“ACMRR”) at the period end in line with market expectations at £8.0 million and £8.6 million respectively. Both the adjusted EBITDA loss and period end net cash are expected to be comfortably better than current market expectations. The Group’s gross profit margin remained above 80%.  FYMar17 revenue £7.6m and PBT loss £1.89m.


Murgitroyd (MUR.L) 387.5p £34.86m

Q3 Feb 17 update from the global firm of patent and trade mark attorneys. The Group’s third quarter revenue of £11.3M represented a 6% increase on the equivalent period in the 2016 financial year. The Board also confirms that the underlying trading result for the third quarter was much improved on the first half performance and ahead of revised internal forecasts for the period. FYMay17E revenue £44.47m and £3.82, PBT. Div 16.8p. 13x PE. Div 4.2%


Park Group (PKG.L) 79.5p £146.57m

FYMar17 trading update from  the multi-retailer, multi-channel gift voucher and prepaid gift card provider. Trading in line with market expectations.  “Trading in the second half, including the important Christmas period, maintained the momentum of the first half and delivered further good progress, as our commitment to product and service enhancement continues to drive success on both sides of the business.  Completed orders for the Consumer business were over 4 per cent ahead of last year. The Corporate business saw increased traction in part due to our ‘Evolve’ digital corporate rewards and incentivisation platform which now has attracted 162 corporate customers following its launch in June last year. Order book and cash ahead of last year. FYMar17E rev £310.8m, EPS 5.58p, divi 2.9p.


Getech Group (GTC.L) 34p £12.77m

H1 Jan 17 results from the consultancy providing geological and geophysical services to the oil, gas and mining industry.  Revenue up 23% to £4.1m, challenging service conditions offset by GIS growth. Operating loss of £377,000 (2016 H1: £697,000 loss) includes redundancy costs of £451,000. Net cash of £2.1m. “Any material recovery in discretionary exploration spending is likely to be a slow build. We do however take some cautious encouragement from recent trading.” “Reflecting our plan to extend our activities further along the oil and gas value chain, we have shaped a new service to assist pipeline operators in their implementation of Esri’s new ArcGIS Pipeline Referencing software.” No market forecasts.


Corero Network Security (CNS.L) 5.75p £12.24m

FYDec16 results from the network security company. Strong performance of flagship SmartWall product with related revenue up 62%. Total revenue up 5% to $8.8 million. Reduced EBITDA loss $5.1 million (2015: $6.4 million). Net cash $2.9 million. “Recommended” rating from NSS Labs, the world’s leading independent product test laboratory . The new financial year is off to a good start, having signed Corero’s largest SmartWall deal to date.  The Board has confidence Corero will deliver strong revenue growth in 2017. Has recently announced proposed £5.6m fundraising at 5p. FY Dec17E £9.43m rev and £5.71m pre-tax loss.


Serica Energy (SQZ.L) 26.5p £69.87m

FYDec16 results from the oil and gas exploration and production company. Gross profit for 2016 of US$6.6 million (2015: US$16.1 million) notwithstanding a 6 month production shut-in.  Strong Erskine well performance, improved off-take facility uptime, allied to rising commodity prices and lower opex per barrel costs, delivered a particularly strong Q4.  Cash of US$16.6 million, increasing to US$25.7 million by end March 2017 before receipt of estimated March net sales income of US$3.5 million. Production guidance for FY17 reiterated at 2,500-3,000 boe per day net to Serica.  Working with partners to extract full value from producing and development assets. Further growth opportunities are available and under consideration.  FYDec17E rev of £32.59m and £14.94mPBT.


Touchstone Innovations (IVO.L) 320p £515.8m

Touchstone Innovations plc has provided £1.5 million seed investment round in Cardian Limited a new spin-out company from Imperial College London. Cardian has been formed to commercialise a novel implantable device that improves the monitoring and treatment of cardiac failure patients, by providing completely automated, continuous wireless monitoring of blood pressure in the pulmonary artery. Innovations will hold a 53.7% interest in the Company, comprising a combination of founders equity and 27.3% derived from investment. Cardian’s CEO, Sandeep Yadav was previously COO of Cardiomems, one of the pioneers of the monitoring of pulmonary arterial pressure. Cardiomems was acquired by St Jude Medical for a total $450m in 2014.


Salt Lake (SO4.L) 39.25p £40.87m

Appointment of experienced international potash mining engineer, Mr Will Longworth, as Chief Operating Officer (not a board appointment), commencing 18 April 2017. For the past 10 years, Mr Longworth has principally been involved in large potash projects around the world, including for Vale and Rio Tinto on the Kronau Potash Project in Saskatchewan, Canada and Potasio Rio Colorado Potash Project in Argentina. He will  lead Salt Lake’s technical and operating team to complete the Lake Wells Pre-Feasibility Study and continue to move the Company’s Projects into development.

Weatherly International (WTI.L) 0.65p £6.9m

Update for copper cathode production during the March 2017 quarter.  Reduced production for the March 2017 quarter with 3,236 tonnes produced, 24% below nameplate. Slower than anticipated leach rates for mixed oxide / sulphide ore stacked during latter parts of 2016 and early 2017 were achieved, reducing the amount of copper harvested. Above average seasonal rains during the quarter prevented short-term acceleration of mining and stacking to compensate. Revised production guidance of 14,500 to 15,000 tonnes of cathode for the financial year ending June 2017. FYJun17E rev £69m and £3.8m pre-tax loss.


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