Small Cap Feast

Small Cap Feast – 10 July 2019

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 891

Total number of AIM Companies trading: 812*
* As at 08 July 2019

Set Menu NEX Growth:

Total number of NEX Growth Market Companies (Incl Susp): 88*

Total number of NEX Growth Market Companies trading: 86*
* As at 08 July 2019

Set Menu Standard List:

Total number of Standard List Companies (Incl Susp): 165*

Total number of Standard List Companies trading: 143*
* As at 08 July 2019

Dish of the Day:

No Joiners Today

Off the Menu:

WYG Plc (WYG) has cancelled its admission on AIM due to being acquired by Tetra Tech.

 

Dish of the Day:

No Joiners Today

Off the Menu:

No Leavers Today

What’s Cooking in the IPO Kitchen?

Main Market (Premium)

ReAssure Group plc  –  The Group is a leading closed book life insurance consolidator in the United Kingdom with 4.3m policies, £68.7 billion of assets under administration on a Post-L&G Illustrative Basis. It is considering a premium listing segment of the main market.

Main Market (Specialist Funds)

Voyager AIR  The Company will focus on the acquisition, leasing and management of primarily widebody aircraft, with asset management services to be provided by Amedeo Limited the IPO will comprise a Placing and Offer for Subscription of Shares to raise up to approximately US$200m.

AIM

Breakfast Buffet

Circle Property (CRC.L) 192p £54.33m

Circle Property, which invests in, develops and actively manages well-located regional office assets, announces record results for the year ended 31 March 2019.

Third successive year of delivering NAV growth – average increase in excess of 20% per annum

NAV per share of £2.77, up 20.43% (2018: £2.30):

NAV up 86% since IPO in February 2016 to £78.4m

NAV CAGR of 23% since IPO; total return CAGR of 26%

9.23% increase in independent valuation of the Group’s portfolio of 15 commercial property investment and development assets in the UK to £124.6m (31 March 2018: £114.1m) demonstrating continued growth in the Group’s asset management program

11.71% increase in contracted annual rental income to £7.61m (2018: £6.8m), post successful disposal of non-core assets and a further £0.34m of contracted rent signed post year end

16.20% increase in operating profit before gains on investment properties to £3.66m (2018: £3.15m)

PBT up 8.97% to £15.25m (2018: £13.99m) and earnings per share of 53p (2018: 51p) reflecting a combination of operational profit and revaluation gains

Xeros Group (XSG.L) 7.5p £16.14m

Xeros Technology Group, the developer and provider of water saving and effluent reduction technologies with multiple commercial and domestic applications, announced that its patent application for microfibre filters suitable for domestic washing machines has now been published by the World Intellectual Property Organization (‘WIPO’).

The device is trademarked XFiltra™ and its design can be licenced by any domestic washing machine manufacturer to drastically reduce microfibre pollution from the washing of clothes.

XFiltra is a combined filter, pump and de-watering unit designed to be an integral part of a domestic washing machine. It can be easily incorporated into any front-loading machine during manufacture.

Washing clothes containing synthetic fibres such as polyester and nylon has been identified as the single biggest source of primary microplastics released into the oceans every year[1] with as many as 700,000 microfibres released into the environment from a single domestic wash cycle.

XFiltra is the world’s first operationally effective and commercially viable filter to address this issue.

Eland Oil & Gas (ELA.L) 127p £267.1m

Eland Oil & Gas, an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, announced that a remedial tubing patch has been installed on the Gbetiokun-3 well in licence OML40.

As previously announced we have been undertaking necessary remedial work on the Gbetiokun-3 short string. The well was drilled as an appraisal well in Q4 2018 with the dual completion on the D9000 and E4000 reservoirs being installed in Q1 2019. During pressure testing, a small leak was identified on the shallower D9000 completion string. Following further diagnostic logging, the leak was located, and a remedial tubing patch has now been successfully installed.

At present, the short string is being produced with the temporary facilities on location. Initial gross rates of some 3,880 bopd have been recorded at a choke size of 36/64″. The deep E4000 interval was tested in Q1 2019 and achieved choke-limited gross rates of 3,000 bopd, in line with pre-drill expectations.

The company expects the field to be brought onstream in July through the Early Production Facility, presently being installed, with initial gross production of approximately 12,000 bopd (net: 5,400 bopd) from the Gbetiokun-1 and -3 wells.

Redx Pharma (REDX.L) 14.5p £7.9m

Redx Pharma announced that it has signed a definitive agreement with Jazz Pharmaceuticals plc (Nasdaq: JAZZ; “Jazz”) under which Jazz has acquired Redx’s pan-RAF inhibitor programme for the potential treatment of RAF and RAS mutant tumours. Jazz will be responsible for all future development, regulatory, manufacturing and commercialisation activities.

Under the terms of the agreement, Jazz will pay Redx an upfront payment of $3.5 million in cash for all rights, title and interest relating to Redx’s proprietary pan-RAF inhibitor programme, including all related patents.  Redx is eligible to receive up to $203m in development, regulatory and commercial milestone payments from Jazz, with the next milestones being initiation of IND enabling studies, followed by a further milestone at IND submission to the FDA. Redx is also eligible for incremental tiered royalties in mid-single digit percentage, based on any future net sales.

As part of a separate collaboration agreement, signed in parallel, Jazz will pay Redx to perform research and preclinical development services with the goal of completing IND-enabling studies.

Oracle Power (ORCP.L) 0.32p £4.03m

Oracle Power, the UK energy developer of a combined lignite coal mine and mine mouth power plant located in the south-eastern Sindh Province of Pakistan (Thar Block VI), advised that the Company has received a further tranche of £50,000 from Brandon Hill Capital Limited, the second amount drawn down under the loan agreement that was announced on 30 May 2019. The total amount drawn down under this arrangement now totals £100,000.

600 Group (SIXH.L) 19.35p £22.44m

The 600 Group, the diversified industrial engineering company, announced its results for the year ended 30 March 2019.

Revenue from continuing operations up 1.9% to $65.2m (2018: $63.9m)

Underlying operating profit up to $5.3m (2018: $1.8m)

Gross margin improved 2.4% to 36.1% (2018: 33.7%)

Underlying pre-tax profit up to $4.1m (2018: $0.6m)

Group order book up 6.5%

Recommended final dividend of 0.5p per share

Central Asia Metals (CAML.L) 201p £352.8m

Central Asia Metals  provided a H1 2019 operations update for the Kounrad dump leach, solvent extraction and electro-winning (‘SX-EW’) copper recovery plant in Kazakhstan (‘Kounrad’) and the Sasa zinc-lead mine in North Macedonia (‘Sasa’).

Production on track to meet full year guidance for copper, zinc and lead

H1 2019 Kounrad

Copper produced, 6,594 tonnes

H1 2019 Sasa

Zinc in concentrate produced, 11,517 tonnes

Lead in concentrate produced, 14,357 tonnes

Cash in the bank on 30 June 2019, $30.2m

Gross debt on 30 June 2019, $126.4m

Tricorn Group (TCN.L) 19.5p £6.25m

Tricorn Group, the tube manipulation specialist, announced on May 14 2019 that it had extended its capabilities and facilities in the USA with the purchase of a powder coating and wet spraying line and securing an initial 5 year lease on 47,000 square feet within a large facility with options to extend for a further 5 years and on a further 50,000 square feet of space within the building.

This facility and the associated paint line are fully operational, well ahead of the expected end of July 2019 timing previously indicated.

Tlou Energy (TLOU.L) 6.35p £27.21m

Tlou Energy announced that the Lesedi 4 production pod has successfully reached Critical Desorption Pressure (“CDP”).

The Lesedi 4 pod has reached CDP;

Short term gas flow test conducted at the Lesedi 3 pod yielding positive results;

Dewatering of the Lesedi 3 & 4 pods is continuing according to plan.

Tlou’s Managing Director, Mr Tony Gilby commented, “We are very pleased to have now reached CDP at both the Lesedi 3 and Lesedi 4 production pods.  The short-term gas flow test at Lesedi 3 has also been positive, and with the primary objective of demonstrating a commercial gas flow rate, we look forward to further testing at both Lesedi 3 and 4.  Further updates will be provided in due course.”

DigitalBox (DBOX.L) 6.88p £6.09m

Digitalbox, the digital media business, will be making the following statement at its AGM today.

Trading in the first half of 2019 has been consistent with expectations for the year as a whole. Our Entertainment Daily platform has continued to deliver excellent levels of audience engagement with its core 30 to 60-year-old female demographic and the size of its unique user base has grown in the first six months of the year.

“The Group’s buy and build strategy commenced with the acquisition of The Daily Mash on 5 March 2019. The process of integrating this brand has gone well to date and we have identified new opportunities to scale the brand further beyond the direct website activity. There continues to be a great deal of interest around the BBC2 show the Mash Report that was nominated for a BAFTA this year.

“The market remains rich with opportunity as the team builds the business. Whilst we continue to review possible acquisition targets, we are also exploring new growth opportunities within the existing business.”

Head Chef:

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

*A corporate client of Hybridan LLP

Disclaimer

This document, which does not constitute research, has been issued by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to any such action. This document has no regard for the specific investment objectives, financial situation or needs of any specific person or entity and is not a personal recommendation to any such person or entity. Recipients should reach an individual investment decision, based upon their respective financial objectives and financial resources and, if any doubt, should seek advice from an investment advisor.

The information contained in this document is based on materials and sources that are believed to be reliable; however, such information has not been independently verified and therefore it is not possible to confirm such information as being accurate. This document is not intended to be a complete statement or summary of any securities, markets, reports or developments referred to herein. No representation or warranty, either express or implied, is made or accepted by Hybridan LLP, its members, officers, employees, agents or associated undertakings in relation to the accuracy, completeness or reliability of the information contained in this document, nor should it be relied upon as such.

The content of this document includes market commentary and other information which we have prepared in relation to the company referred to in this document, which is our broking client. The provision of this document to you constitutes a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of Regulation 600/2014/EU (MIFID II Regulation).

Any and all opinions expressed are current as of the date appearing on this face of this document only. Any and all opinions expressed are subject to change without notice and Hybridan LLP is under no obligation to update the information contained herein. To the fullest extent permitted by law, none of Hybridan LLP, its members, officers, employees, agents or associated undertakings shall have any liability whatsoever for any direct or indirect or consequential loss or damage (including lost profits) arising in any way from use of all or any part of the information in this document.

This document should not be relied upon as being an independent or impartial view of the subject matter and, for the avoidance of doubt, constitutes non-independent research (as such term is defined in the Financial Conduct Authority’s Conduct of Business Sourcebook to reflect the requirements of the MIFID II Regulation and Directive 2014/65/EU (known as MIFID II)). The individuals who prepared this document may be interested in shares in the company concerned and/or other companies within its sector, may be involved in providing other financial services to the company or companies referenced in this document or to other companies who might be said to be competitors of the company or companies referenced in this document. As a result both Hybridan LLP and the individual members, officers and/or employees who prepared this document may have responsibilities that conflict with the interests of the persons who receive this document. Hybridan LLP and/or connected persons may, from time to time, have positions in, make a market in and/or effect transactions in any investment or related investment mentioned herein and may provide financial services to the issuers of such investments.

In the United Kingdom, this document is directed at and is for distribution only to persons who (i) fall within article 19(5) (persons who have professional experience in matters relating to investments) or article 49(2) (a) to (d) (high net worth companies, unincorporated associations, etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (SI 2005/1529) (as amended) or (ii) persons who are each a professional client or eligible counterparty (as those terms are defined in the Financial Conduct Authority’s Conduct of Business Sourcebook) of Hybridan LLP (all such persons referred to in (i) and (ii) together being referred to as relevant persons). This document must not be acted on or relied up on by persons who are not relevant persons. For the purposes of clarity, this document is not intended for and should not be relied upon by any person who would be classified as a retail client under the Financial Conduct Authority’s Conduct of Business Sourcebook.

Neither this document, nor any copy of part thereof may be distributed in any other jurisdictions where its distribution may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Distribution of this report in any such other jurisdictions may constitute a violation of territorial and/or extra-territorial securities laws, whether in the United Kingdom, the United States or any other jurisdiction in any part of the world.

Where possible this document is made available to all relevant recipients at the same time. Dissemination of research by Hybridan LLP is monitored to ensure that it is only provided to relevant persons. Research prepared by Hybridan LLP is not intended to be received and/or used by any person who is a retail client.

Hybridan LLP and/or its associated undertakings may from time-to-time provide investment advice or other services to, or solicit such business from, any of the companies referred to in this document. Accordingly, information may be available to Hybridan LLP that is not reflected in this material and Hybridan LLP may have acted upon or used the information prior to or immediately following its publication. In addition, Hybridan LLP, the members, officers and/or employees thereof and/or any connected persons may have an interest in the securities, warrants, futures, options, derivatives or other financial instrument of any of the companies referred to in this document and may from time-to-time add or dispose of such interests.

This document may not be copied, redistributed, resent, forwarded, disclosed or duplicated in any form or by any means, whether in whole or in part other than with the prior written consent of Hybridan LLP.

MIFID II status of Hybridan LLP research
The cost of production of our corporate research is met by retainers from our corporate broking clients. In addition, from time to time we issue further communications as market commentary (such as our daily newsletter, Small Cap Breakfast), which we consider to constitute a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of the MIFID II Regulation.

Hybridan LLP is a limited liability partnership registered in England and Wales, registered number OC325178, and is authorised and regulated by the Financial Conduct Authority and is a member of the London Stock Exchange. Any reference to a partner in relation to Hybridan LLP is to a member of Hybridan LLP or an employee with equivalent standing and qualifications. A list of the members of Hybridan LLP is available for inspection at the registered office, 2 Jardine House, The Harrovian Business Village, Bessborough Road, Harrow, Middlesex HA1 3EX.

If you would like to unsubscribe, please email enquiries@hybridan.com with “unsubscribe me”.