Small Cap Feast

Small Cap Feast – 10 June 2019

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 894

Total number of AIM Companies trading: 819*
* As at 10 June 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 10 June 2019

Set Menu Standard List:

Total number of Standard List Companies (Incl Susp): 163*

Total number of Standard List Companies trading: 141*
* As at 10 June 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 (Premium)

Trainline—Seeking £75m raise. Proceeds to target a net debt at IPO of c.2x LTM Adjusted EBITDA). In FY 2019, Trainline achieved net ticket sales of £3.2bn, and revenue of £210m.  Due June

Airtel Africa Limited — provider of telecommunications and mobile money services, with a presence in 14 countries in Africa, primarily in East Africa and Central and West Africa, looking to join the premium segment of the main market. Offer TBC, expected TBC

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 (Standard)

IMC Exploration Group (NEX: IMCP), focused on acquiring and exploring prospecting licence areas which have high potential for natural resource, is looking to admit its shares to the standard list and will withdraw for the NEX Exchange. Expected 11 June 2019

AIM

Renold plc—a leading international supplier of industrial chains and related power transmission products, announced that it will cancel the listing of the Company from the premium segment and apply for admission on AIM. Expected 06 June 2019.

 

Breakfast Buffet

Emmerson (EML.L) 4.55p £26.30m

Formal indication of significant debt financing for Khemisset (low cost, high margin potash project in Morocco)  from a major European commercial bank. The indicative sizing shows debt capacity of up to US$230m would be feasible assuming standard project finance terms and conditions. It is expected the syndicate will comprise of commercial banks and Export Credit Agencies.

Highlights

Indication of potential project finance debt of up to US$230m for construction of the Project has resulted from ongoing discussions with major global commercial bank

Debt sizing based on very conservative, bank case, pricing assumption of US$235/tonne (delivered to Brazil) Muriate of Potash price flat over the life of the project

This price represents c. 35% discount to current spot prices

Strong potential to increase debt capacity if customer floor prices above base case can be negotiated

Indicative terms in line with market norms for mine construction project finance including standard covenants, cash sweeps and security packages

CyanConnode (CYAN.L) 4.85p £8.76m

 AGM statement from the leader in Narrowband Radio Frequency (RF) Smart Mesh Networks.

“2018 was a transformational year for CyanConnode, seeing revenue growth of 281% to £4.5m, improved gross margins of 452% to £2.7m and a 22% reduction in operating costs to £9.1m (or £8.1m excluding stock impairment, foreign exchanges gains / losses and share based payments).

“Our significant revenue growth in 2018 was attributable to the launch of the standards-based Omnimesh Advanced Metering Infrastructure (AMI) platform, which allows easy integration and deployment into multiple markets.  Omnimesh was launched in June 2018 and within six months it had gained considerable commercial traction, especially in our largest market, India, where orders for the period totalled £15m.”

The first five months of 2019 are performing in line with our expectations and we remain confident that the Company has sufficient capital to execute our business plan.  We look forward to updating the market on future developments and take this opportunity to thank our shareholders, employees and advisors for their continued support.”

Avacta (AVCT.L) 30.50p £35.43m

 The developer of Affimer® biotherapeutics and research reagents, announces that it has selected the clinical development candidate for first-time-in-human clinical trials of the Affimer platform.  This important milestone means that the Group remains on track to submit an IND/CTA application for an Affimer PD-L1 inhibitor by the end of 2020.

The Group has generated a wide range of Affimer inhibitors of PD-L1, a well known cancer immunotherapy target.  This target was chosen to demonstrate safety and tolerability of the Affimer platform in human and, importantly, to provide a proprietary basis for its novel tumour microenvironment activated drug conjugate (TMAC™) and bispecific cancer immunotherapies.

The cancer immunotherapy market is currently worth $60bn and is predicted to double by 2025.  Avacta’s combinatorial approach to treatment through its TMAC and bispecific cancer immunotherapies, which build upon inhibition of PD-L1, are designed not only to compete strongly in this market through improved clinical benefit to patients, but also to expand the market to patients who do not respond to single checkpoint inhibitors.

Ideagen (IDEA.L) 147.50p £316.49m

The supplier of Integrated Risk Management software to highly regulated industries, is pleased to announce the acquisition of the entire issued share capital of Redland Solutions Ltd for a net consideration of £15.8m.

Redland is a fast growing, profitable RegTec SaaS company supplying software to the financial services industry

Redland’s leading SaaS platform ‘Insight’ provides banks, investment managers, asset managers and insurance companies with solutions that underpin the Senior Manager & Certification Regime (SMCR) and individual employee competency.

Current Annual Recurring Revenue (ARR) is approximately £3m – an increase of 50% from April 2018

Current run rate revenues are approximately £4.2m and current run rate costs are approximately £2.7m

 Cash generation of > 100% of EBITDA in the year to 31 March 2019

The acquisition is immediately earnings enhancing and is expected to add mid-single digit accretion within the current financial year

Baron Oil (BOIL.L) 0.10p £1.86m

The oil and gas exploration and production company, has conditionally raised £440,000 by way of a placing of 550,000,000 new ordinary shares with new investors at an issue price of 0.08 pence.

The Board is aware that the Placing is dilutive to existing shareholders and considered whether any pre-emptive offering might be possible but concluded that it was neither practicable nor cost effective to do so. The issue price represents a discount of approximately 40% percent to the closing mid-market price of 0.135p per share on 7 June 2019. In addition to its working capital requirements, the proceeds of the Placing will be used to continue to evaluate the existing portfolio of oil and gas assets which includes the Colter South discovery, the Purbeck Prospect and the new licences offered to Baron in the Moray Firth.

In parallel, the Company is also working to progress further drilling activity in 2019 by bringing in a partner to Peru Block XXI.  South East Asia remains an area of potential growth where Baron has an existing application in place with SundaGas Pte. Ltd. The Company will continue to manage its G&A costs so as to maximise the deployment of cash into its project portfolio.

Accrol Group Holdings (ACRL.L) 26.00p £50.76m

FFYApr19 trading update

Following the conclusion of the restructuring, the Group performed well in Q4 and in line with the management’s strategic turnaround objectives, achieving and maintaining acceptable levels of monthly profitability on an Adjusted EBITDA level.

 Total revenues in FY19 were c.£119m, broadly unchanged on a like for like basis against the prior year, as the Group exited a number of low margin contracts. Sales in the Group’s core toilet roll product, however, increased by c.12% year on year to c.£85m from £76m in FY18. Adjusted EBITDA was c.£1m, representing a c.£7m improvement on the prior year despite the substantial impact of FX and material cost headwinds which increased by an estimated c.£10m. Adjusted loss before tax is expected to be in the range of £2.5m to £3.0m. Exceptional costs, primarily associated with the turnaround process, are expected to be in the range of £7.5m to £8.0m. Net debt was reduced faster than anticipated, finishing the year at c.£27.1m, c.£2.5m lower than the previously anticipated level of c.£29.6m, ensuring that the Group comfortably fulfilled on its banking commitments.

Live Company Group (LVCG.L) 70.00p £50.37m

The  global children’s entertainment and education brandGroup has entered into an agreement with SMG Europe Holdings Limited an events venue management company, to promote the first BRICKLIVE Show at P&J Live, Aberdeen, from the 20 to 22 of September 2019.

Opening in summer 2019, P&J Live is Scotland’s new, £333m state of the art, entertainment venue, being delivered by Aberdeen City Council, replacing the Aberdeen Exhibition and Conference Centre, with 48,000 square metres of new multi-purpose events space.

The BRICKLIVE Show will be the Group’s first show in Aberdeen, and will feature BRICKLIVE Ocean as the show’s centrepiece, along with popular brick pits, race ramps as well as other interactive activities.

REDX Pharma (REDX.L) 5.25p £6.64m

FY mar 19 results from the  drug discovery and development Group. “In our 2018 annual report the Board and Management set out our strategy, focused on moving RXC004, our porcupine inhibitor programme for Wnt driven cancer, back into the clinic.  We also set out our plan to move RXC006, a porcupine inhibitor targeted at idiopathic pulmonary fibrosis, into preclinical development as well as selecting a development candidate for our ROCK2 programme for fibrosis.  Throughout the first six months of the year we have made progress against these aims, most notably reinitiating our phase 1 clinical trial of RXC004 .”

“Short-term loan agreement of up to £2.5m from Moulton Goodies Ltd (MGL), the Company’s largest shareholder, which extends our cash runway into the fourth quarter of 2019.”

Serinus Energy (SENX.L) 12.50p £29.86m

Appointment of Mr. Judicael Tinss as Chief Operating Officer of the Company.

Mr. Tinss has eighteen years of experience in reservoir management and business development within the international exploration and production sphere, including the United States, West Africa, Middle East and Europe. He holds a Master of Science in Petroleum Engineering from Texas A&M University, a Master of Geoscience from Institut Français du Pétrole et des Moteurs, Rueil-Malmaison, France, and Bachelor of Science in Petroleum Engineering from the Colorado School of Mines, Golden, Colorado.

Gunsynd (GUN.L) 0.04p £2.49m

£500k placing at 0.037p.

Hamish Harris, executive Chairman of the Company, commented: “The recent movement in the share price has allowed us to raise money on a far less dilutive basis to shareholders.   Not only that but it has increased the opportunities within our own portfolio, not least with respect to the Madagascar oil and gas licence.  Rather than being heavily diluted by third party investors we can now look at a wider range of options with respect to progressing work on the block”.

Head Chef:

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

*A corporate client of Hybridan LLP

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