Small Cap Feast

Small Cap Feast – 09 April 2019

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 898

Total number of AIM Companies trading: 827*
* As at 01 April 2019

Set Menu NEX Growth:

Total number of NEX Growth Market Companies (Incl Susp): 89*

Total number of NEX Growth Market Companies trading: 87*
* As at 01 April 2019

Set Menu Standard List:

Total number of Standard List Companies (Incl Susp): 161*

Total number of Standard List Companies trading: 141*
* As at 01 April 2019

Dish of the Day:

No Joiners Today

Off the Menu:

No Leavers Today

Dish of the Day:

No Joiners Today

Off the Menu:

No Leavers Today

What’s Cooking in the IPO Kitchen?

Main Market

Rustranscom plc— specialised rail freight transportation in Russia and Kazakhstan, announced its potential intention to conduct an IPO of GDRs. The GDRs are expected to be admitted to the Official List of the FCA and to trading on the main market of the LSE. Offering is expected to comprise predominantly primary shares, in the amount of circa $300m.

Main Market (Premium)

US Solar Fund, a newly-established investment company focused on investing in solar power assets mainly in the US, looking to raise $250m at $1. Expected 16 April

Network International Holdings—Leading enabler of digital commerce across the Middle East and Africa  region, operating across over 50 highly under penetrated payment markets that contain a total population of 1.5 bn. 2018 rev $298m, underlying EBITDA $152m.  Due April. No new funds to be raised. Secondary sell down. Targeting free float of  at least 25%.

AIM

Techniplas –global  producer and support services company providing highly engineered and technically complex components, making the supply chain to original equipment manufacturers more efficient.  FYDec17 rev $515m.

Loungers plc—the operator of 146 café/bar/restaurants across England and Wales under the Lounge and Cosy Club brands, announces its intention to seek admission on AIM, offer TBC, expected late April.

SDX Energy plc—a North Africa focused oil and gas company, announces its intention to complete a Canadian plan of arrangement under section 192 of the Canada Business Corporations Act and will have shares de-listed from the TSX-V and admitted to trading on AIM. Expected 28 May 2019, anticipated market cap of £76m

Breakfast Buffet

The City Pub Group (CPC.L) 234p £136.4m

The City Pub Group announced its audited results for the 52 weeks ended 30 Dec 2018. The Group operates a predominately freehold estate of 44 wet-led pubs in Southern England and Wales. Four further sites are currently in development and two exchanged sites are due to complete imminently, which will bring the size of the total estate to 50.

Revenue up 22% to £45.7m (2017: £37.4m)

Like for like sales growth of 1.6%

Adjusted EBITDA up 28% to £7.9m (2017: £6.1m)

Adjusted PBT up 60% to £5.1m (2017: £3.2m)

Total dividend up 22% to 2.75p (2017: 2.25p)

Reported profit / (loss) of £2m (2017: (£0.7)m)

Net debt to EBITDA 1.1 times (2017: 0 times)

 

The Property Franchise Group (TPFG.L) 148.5p £38.09m

The Property Franchise Group, one of the UK’s largest property franchises, announced its final results for the year ended 31 Dec 2018.

Group revenue increased 11% to £11.2m (FY 2017: £10.1m)

Adjusted EBITDA increased 15% to £5.1m (FY 2017: £4.4m)

PBT £4.3m (FY 2017: £4.3m included net exceptional gain of £0.7m) 

Operating margin increased to 39% (FY 2017: 37%)

Management Service Fees increased 14% to £9.4m (FY 2017: £8.3m)

Proposed final dividend increased by 11% to 6p, total of 8.4p (FY 2017: 7.5p)

Strong balance sheet with net cash of £2.3m (FY 2017: £0.1m)

 

Colefax Group (CFX.L) 530p £46.58m

The Company announced the launch of a proposed Tender Offer by Peel Hunt to purchase up to 8% of the Company’s issued share capital.  The Tender Offer is being proposed in line with the authority to purchase Shares on-market that was granted by Shareholders at the Company’s 2017 AGM held on 14 Sept 2017.

The Company has engaged Peel Hunt to implement the Tender Offer. Pursuant to the Tender Offer, Peel Hunt will purchase, as principal, up to a maximum of 784,560 Shares.

The Company has granted a put option to Peel Hunt pursuant to the Repurchase Agreement under which Peel Hunt may require the Company to purchase at the Tender Price the Shares purchased by Peel Hunt pursuant to the Tender Offer.  Shares that are purchased from Peel Hunt by the Company will be cancelled.

 

i3 Energy (I3E.L) 43.2p £37.15m

i3 Energy, an independent oil and gas company with assets and operations in the UK, provided the following operational update for the appraisal and development of its 100% owned and operated Liberator field and Serenity prospect.

Borgland Dolphin semi-submersible drilling rig contracted for Summer drilling campaign

Drilling due to commence between 15 July 2019 and 15 Aug 2019

Drilling campaign expected to unlock the Company’s asset base, with three planned wells to include the A3 appraisal well into Liberator’s western extension, the Liberator Phase I L2 pilot well and the S1 appraisal well into the Serenity prospect

Key equipment secured including wellheads and conductor pipe

Site survey completing this week

 

appScatter Group (APPS.L) SUSPENDED

appScatter Group, the app management and data intelligence platform, announced the intention to acquire Airpush, Inc., a technology company specialising in app monetisation which, if approved and completed would constitute a reverse takeover. Accordingly, trading in the Company’s shares will be suspended on AIM until such time as the Company is able to publish an admission document in relation to the Proposed Acquisition, expected by early June 2019 or confirms that the Proposed Acquisition is no longer in contemplation.

The Company also announces a planned £2.2m subscription for new ordinary shares in appScatter, at 26.8p per share, of which the Company has now received firm commitments for £0.89m. The Company expects to receive the remaining £1.315m commitments and the £2.2m subscription funds in the next few days.

 

Sosandar (SOS.L) 28.75p £30.79m

Sosandar, the online women’s fashion brand, announced the following trading update for the year ended 31 March 2019

The Company expects to report very strong revenue growth of 228% to £4.44m, comfortably in line with market expectations.

Continued expansion of a loyal and engaged customer base:

Repeat orders increased 389% to 55,828

Number of orders increased 224% to 102,742

New customers up 131% to 46,914.

Customer database increased 95% to over 105,000

Conversion rate increased 76 bps to 2.92%

Average order value increased 10% to £103.19

Increased efficiencies in marketing spend across all channels with significant CPA improvements.

Returns of 50% reflect the anticipated improvement in the second half of the year from the 52% reported at interim results.

A significant investment in stock of £260k was made at the end of Q4 to fulfil the peak demand going into Q1 of the new financial year.

Strong balance sheet with net cash of £3.64m as at 31 March 2019.

 

Cabot Energy (CAB.L) 9.25p £2.95mm

Cabot Energy, the oil and gas company focussed on creating predictable production growth in Canada, announced that Ouro Preto Resources Pty Ltd, the Company’s wholly-owned subsidiary, has reached an agreement with The Department for Energy and Mining of the Government of South Australia (“DEM”) to relinquish its PEL 629 onshore exploration licence in the Otway Basin, South Australia .

The Company has received confirmation from DEM that it will be granted permission to vary out current commitments of its second year PEL 629 work programme for a nominal fee. The formal application for variation and relinquishment of the Licence has been submitted and the relinquishment is expected to take immediate effect. The Company will not incur any further costs or penalties associated with the outstanding work programme.

The Licence had been in suspension since June 2014 to allow the Company to carry out further technical work and evaluation. As at 31 Dec 2018, the Net Book Value was zero, with the majority of the asset impairment ($0.97m) booked in 2015.

 

Premier Asset Management Group (PAM.L) 200p £215.83m

Premier Asset Management announced a trading update for the Company’s quarter ended 31 March 2019.

Total AUM were £6.8bn as at 31 March 2019 (31 March 2018: £6.4bn)

Total net inflows of £3m in the three months to 31 March 2019 (3 months to 31 March 2018: £175m)

Twenty fourth successive quarter of positive net inflows

Total net inflows of £67m in the six months to 31 March 2019 (6 months to 31 March 2018: £411m)

Total net inflows of £390m for the rolling twelve months to 31 March 2019 (rolling twelve months to 31 March 2018: £847m)

Continued strong investment performance net of fund charges:

Over three years to 31 March 2019: 72% of AUM were above median

Over five years to 31 March 2019: 83% of AUM were above median

Quarterly dividend per share of 1.7p vs 1.65p for the same period last year

 

Stride Gaming (STR.L) 114.5p £97.4m

Stride Gaming, a leading online gaming operator, provides the following update on current trading.

The Board expects to report NGR for the six month period ended 28 Feb 2019 approximately 5% lower than expected, reflecting greater disruption arising from fiscal and regulatory changes implemented in the second half of calendar year 2018.

Positively, the Board sees encouraging signs that the impact of these disruptive factors have now been largely absorbed and the business model is adjusting accordingly. Whilst the Board does not expect to recover the first half revenue shortfall through trading in the second half, the Board is confident that its strategy of leveraging the Group’s infrastructure and proprietary technology to migrate more mass market, recreational bingo and casino customers onto its higher margin proprietary platform is robust and will deliver strong long term, cash backed value for shareholders.

The Board expects to report a strong performance from its “Stride Together” B2B JV and is encouraged by additional new joint venture opportunities. Furthermore, as a result of encouraging growth trends in its Indian Rummy business, the Board has increased its technology and marketing investment in Passion Gaming, in which Stride has a 51% share. As a result the Board now expects to report incremental costs of approximately £0.4m for this part of the Group.

 

Altus Strategies (ALS.L) 3.88p £6.9m

Altus Strategies, the Africa focused exploration project generator, announced that it has defined a series of drill targets to test the potential of expanding the Company’s 100% owned Tabakorole gold project located on the Massagui gold belt in southern Mali, approximately 100km southwest of the multi-million ounce Morila gold mine.

2.7 km long shear zone hosted orogenic gold project located in southern Mali

Historical drilling includes 16 m at 9.31 g/t Au, 14 m at 9.84 g/t Au and 60 m at 2.91 g/t Au

Tabakorole hosts a historical near surface resource at the FT prospect comprised of:

7,880,000 tonnes at 0.94 g/t Au for 240,000 ounces in the Indicated category

10,550,000 tonnes at 1.03 g/t Au for 350,000 ounces in the Inferred category

Based on a 0.5 g/t cut off

High grade intercepts including 18 m at 6.05 g/t Au from 12 m and 24 m at 2.53 g/t Au from 48 m were not incorporated in the historical resource estimate. See “Tabakorole Project: Historical resource” and “Cautionary note regarding historical data”

Multiple new drill targets defined, with the potential to expand the historical resource

Due diligence progressing under JV Term Sheet signed with Indiana Resources Ltd

 

Head Chef:

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

*A corporate client of Hybridan LLP

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