Small Cap Feast

Small Cap Feast – 06 April 2020

Dish of the Day:

No Joiners Today

 

Off the Menu:

Haynes Publishing has left the Official List following a cash takeover.

 

What’s Cooking in the IPO Kitchen?

Breakfast Buffet

Symphony Environmental Holdings* 12p £20.4m (SYM.L)

Trading update and COVID 19 statement. The new trading year has started strongly, with revenues for the first quarter ended 31 March 2020 increasing 56% to £2.4m compared with £1.6m for the first quarter of 2019. The Group’s cash position at 31 March 2020 was relatively healthy with more than £1.0m available between cash and existing bank facilities. Based on current financial modelling, the Group does not expect to need any additional cash in the next 12 months and will be able to continue to operate within its current financial resources.

Whilst Q1 does not include any material inventory correction, SYM expects customer inventory levels to increase during the year. The increase in revenue for Q1 is therefore a more general reflection of  organic growth.

FY-2020 impact cannot as yet be fully assessed.  Accordingly, the Board believes it would be inappropriate to provide forward looking financial guidance to investors and analysts at this time.

However enquiries for d2p (designed to protect) anti-microbial and other protective products are growing at a much faster pace. SYM expects to see increased sales as additional protection becomes an everyday necessity.   Independent testing of d2p against  members of the Coronavirus group is underway with results expected before the   end of June.  Based on scientific literature and research, that the active ingredient used by Symphony does have good anti-viral properties.

 

Providence Resources 1.75p £11.5m (PVR.L)

Intention to conditionally raise approximately $3.0 million  at 1.5p. A  13% discount with 1 warrant at 3p and one at 9p per share.  Includes a subscription by SpotOn Energy with whom Providence has today announced a non-binding and non-exclusive heads of terms  in  relation to the farm out of Standard Exploration Licence (SEL) 1/11 which contains the Barryroe oil and gas field. SEL 1/11 is operated by EXOLA DAC (80%), a wholly-owned subsidiary of Providence, on behalf of its partner, Lansdowne Celtic Sea Limited (20%)

The proceeds of the Fundraising will be used principally to provide general working capital for the business to cover general administration, licencing and Placing costs, until April 2021. In the event that the amount raised pursuant to the Fundraising is increased as a result of excess demand, this will provide the Company with additional working capital which will take it beyond this date and ensure greater financial flexibility.

 

APQ Global 14p £10.96m (APQ.L)

Book Value and Market Update from the emerging markets growth company.

The Company experienced very difficult trading conditions during the month of February, due to extreme market movements in emerging markets currencies, bonds and equities, while putting pressure on the outlook for its private direct investments. During March, the Company continued to experience difficult trading conditions and volatility in emerging markets, resulting from the COVID-19 pandemic. This resulted in a further deterioration of the value of the Company’s unaudited book value per share.

During this time, the Company took decisive action to mitigate further risk to the its balance sheet, de-risking its portfolio of liquid market securities, with the current portfolio comprising:

  • $40.6 million of unencumbered cash; $4.3 million of cash equities; $1.3 million of cash bonds; and $1.3 million of tangible book value in its private direct investments.

At the close of business on 31 March 2020, the Company’s estimate of its unaudited book value per Ordinary Share was 10.4 US Dollar cents, equivalent to 8.4 Pounds Sterling pence.

The Company has met all its payment obligations to various counterparties and is not in breach of any debt covenants. Furthermore, with the ongoing uncertainty faced by emerging markets due to COVID-19, the Board has decided to implement further cash preservation measures, which are intended to facilitate a smooth recovery.

 

Gresham House Strategic 900p £31.3m (GHS.L)

Update for the financial year ended 31 March 2020.  Highlights:

– The Board and Manager retain confidence in the strategy, believe the portfolio is well positioned in the present difficult environment. This confidence is reflected in the decision to retain our commitment to raise the dividend by 15%

– GHS Total Shareholder Return of -5.19% in the year to 31 March 2020 compares to the average IMA Open-ended Fund universe of -17.95% where GHS has outperformed all but one UK Small companies OEICs. 

– Unaudited 12-month NAV total return performance of -14.3% to 1062.2p [2]/share vs FTSE Small Cap Index total return of -24.7% in the year from 1 April 2019 to 31 March 2020.

– £1.6m return of cash to GHS shareholders via a buy-back of 74,446 shares and dividends of £751,900 during year, funded by net profitable realisations of £2.3m and dividend income in the year of £717,000

– Share price discount to NAV reduced from 22.6% 31 March 2019 to 15% at 31 March 2020, having reached a discount of 3.4% in December prior to the recent market sell-off.

– Exciting pipeline of potential investments with COVID-19 related financial stress to generate many new opportunities for capital deployment; situations our specialist investment strategy is made for.

– The Board will continue to consider all opportunities to grow GHS.

 

Avacta Group 19.5p £34.3m (AVCT.L)

Further to the announcement of 2 April 2020 detailing the subscription, and in response to substantial institutional interest, the Company has today conditionally raised gross proceeds of £3.75 million pursuant to a placing  at a price of 18 pence per share, being the same price as the Subscription.

Proceeds to   fund the next key value inflection points, being:

  • the phase 1 clinical trial of AVA6000 pro-doxorubicin;
  • continuing to advance Affimer ® immunotherapy pipeline with partners;
  • delivering further commercial progress for therapeutics and diagnostics; and
  • developing a small pipeline of Affimer ® based diagnostic tests for licensing.

 

Altus Strategies 25p £17.5m (ALS.L)

The Africa focused project and royalty generator, announces the appointment of Mr Karim Nasr as a non-executive director of the Company effective immediately. Karim is the Chief Executive Officer of La Mancha Group and the appointment is in accordance with the terms of the Strategic Investment Agreement (SIA) between La Mancha Holding S.à r.l.  and the Company. La Mancha is the holding company of a group of companies known as the La Mancha Group.  The SIA closed and a concurrent 5 to 1 consolidation in the Company’s share capital occurred on 21 February 2020, following approval of the Company’s shareholders received at the General Meeting held on 18 February 2020.

La Mancha acquired 35.45% at C$0.45 for approximately C$11.2m gross.

 

BeHeard Group 0.2p £2.49m (BHRD.L)

The digital marketing services group, announces an  update in light of the Covid-19 pandemic.

 The evolving Covid-19 pandemic is currently having and will continue to have a material and adverse impact on the demand and supply side of both national and international economies. The effects of this economic shock will no doubt be profound, even if it should prove to be somewhat short lived.

With regards to Be Heard Group, “we have implemented a number of contingency plans to ensure that we are able to protect the well-being of our employees and, moreover, continue to serve our broad and diverse client base.”

Trading in the current financial year started well and was in line with the Board’s expectations. However  Company is withdrawing financial guidance until visibility on the impact of Covid-19 improves. The Group is implementing a number of cost control measure .

 

Kore Potash 0.625p £9.6m (KP2.L)

The potash exploration and development company whose flagship asset is the 97%-owned Sintoukola Potash Project located within the Republic of Congo (RoC), announced that Certificates of Environmental Compliance were issued on 31 March 2020 by the Ministry of Tourism and Environment of the Republic of Congo, each with a 25 year validity. These Certificates relate to the Environmental and Social Impact Assessmentsfor both the Dougou and Kola Mining Licences and relax the previous requirement for periodic compliance certificates.

 

Physiomics* 1.65p £1.2m (PYC.L)

Award of further contract of undisclosed value by its existing client, Bicycle Therapeutics  

The Project is an extension of the work the Company completed on Bicycle’s lead programme, BT1718 (currently in a Cancer Research UK-sponsored Phase I/IIa study), which Physiomics announced on 8 July 2019.  Physiomics’ role is related to the analysis of clinical data from this trial and its work on the initial project was acknowledged in a poster presentation, at the ESMO conference, in September 2019(1).  The Project is expected to be completed in the next six months.

 

Novacyt 207.5p £140.4m (NCYT.L)

The international specialist in clinical diagnostics, announces that the CNR (Centre National de Référence des Virus des Infections Respiratoires)  of the Institut Pasteur, an internationally renowned centre for biomedical research with a goal of improving public health in France, has approved its COVID-19 test. The Company’s CE-Mark test is available for immediate distribution into the French market.

On 2 April 2020, Novacyt also received approval for its COVID-19 test from the Ministry of Health in Thailand.

 

Head Chef:

Derren Nathan
0203 764 2344
derren.nathan@hybridan.com

*A corporate client of Hybridan LLP

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