Small Cap Feast

Small Cap Feast – 17 May 2019

Dish of the Day:

No Joiners Today

Off the Menu:

No Leavers Today

What’s Cooking in the IPO Kitchen?

Main Market (Premium)

Jewel UK Midco Limited, the parent company of The Watches of Switzerland Group Limited, is looking to join the premium segment of the main market. Offer TBC, expect TBC

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

Pure Gold—  TSX listed seeking a London listing. Focused on Madsen Red Lake Gold Deposit.  Feasibility Study outlines a robust 12-year, high grade, 800 tonne per day underground mining operation with low initial capital cost of C$95mm and strong financial performance with an after-tax NPV of C$247mm . Introduction only at this point Mkt cap CA£138m.

Main Market (Specialist Funds)

Riverstone Credit Opportunities Income  – raising US$200m—will seek to generate consistent shareholder returns predominantly in the form of income distributions principally by making senior secured loans to energy-related businesses. Due 24 May


Essensys plc—a provider of mission-critical SaaS platforms and on-demand cloud services to the high growth flexible workspace industry, plans to join AIM. Offer TBC,  expected 29 May 2019.

Induction Healthcare Group plc—a healthcare technology company focused on streamlining the delivery of care by Healthcare Professionals looking to join AIM. Expected raise of £14.58m at 115p, market cap of £34.07m. Expected 22 May 2019.

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

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.

Alumasc Group plc, the premium building products, systems and solutions group, has announced its intention to move from the Premium Segment of the main market to AIM. Expected market cap of £33.4m. Expected 25 June 2019

NEX Exchange

SSuINOx—has developed a hydrocarbon fuels conditioning and emulsifying process that enables more efficient fuel combustion, leading potentially to reduced fuel usage and significantly lowered emissions.  Offer TBA.

Rumours and Speculation

According to Reuters — Walmart, the world’s biggest retailer, said it is considering a stock market listing for its British supermarket arm Asda, whose attempt to combine with rival Sainsbury’s was blocked by the UK regulator last month.

Breakfast Buffet

Urban Logistics (SHED.L) 122.5p £107m

Urban Logistics, the specialist UK industrial and logistics REIT, announced that it has sold a site located on Postley Road, Bedford for £9.2m realising a Total Property Return of 74%.

The 85,012 sq ft site was purchased at the time of the Company’s IPO in Apr 2016 for £5.5m and comprises four industrial units together with a piece of development land. The development land, which the purchaser has an option to acquire if planning permission is granted (for £0.5m), is not included in the disposal and will be retained by the Company.

The units, which have been sold to Apperly Estates Limited, are fully let with an average WAULT of 5.9 years. They have undergone extensive asset management, with new rents agreed at £6.52 per sq ft on Unit A and £6.26 per sq ft on Unit B.

Actual Experience (ACT.L) 190p £83.07m

Actual Experience, the analytics-as-a-service company, announced that its digital user software has been successfully evaluated by Vodafone, one of its existing Channel Partners, to assess deployment capability on Universal Customer Premises Equipment (uCPE). This equipment is typically deployed to customer sites by a service provider.  This is a landmark development for Actual Experience, representing the successful achievement of a key strategic milestone.

Actual Experience’s digital quality analytics could now be easily and quickly deployed on next generation uCPE, such as Vodafone. The evaluation has established that, if an enterprise has a uCPE device installed at a site and chooses to utilise the analytics service from Actual Experience, the device will be capable of running the Digital User. It is anticipated this will both significantly reduce the sales cycle for customer engagement and increase the speed of deployments.


Scholium Group (SCHO.L) 42.5p £5.78m

Scholium Group provided an update on trading for the 12 months ended 31 Mar 2019.

The Group made further progress during the six months to 31 Mar 2019 in developing its three separate revenue streams- Shapero Rare Books, Scholium Trading and Mayfair Philatelics.

The  Group anticipates, as a whole, a small profit for the six months to 31 Mar 2019, which is a modest improvement on the interim pre-tax loss of £56,000 for the six months to 30 Sept 2018. The Group therefore expects to have traded, similarly to the prior year, at approximately breakeven for the year ended 31 Mar 2019.

Both Scholium Trading and Mayfair Philatelics performed well; Scholium Trading had a good year, with profits above the previous year, and continues to pursue a number of interesting opportunities. Mayfair Philatelics had a successful H2 of the year, achieving a profit for that period with three auctions held during the period, compared to one in the first half year.

Trading in Shapero Rare Books, however, reflected the difficult current retail environment and the overall outcome for the year is expected to be below the prior year.

African Battery Metals (ABM.L) 0.45p £1.63m

African Battery Metals, the battery metal exploration and development company announced an update regarding exploration activities at the Company’s Kisinka Copper-Cobalt project in the Democratic Republic of Congo (“DRC”).

2 field geologists, 5 field technicians, 2 logistical support staff and 14 casual labourers were deployed from a temporary field camp at the Company’s Kisinka project;

A total of 663 termite mound samples, excluding samples collected for QA/QC purposes, were collected over 3 weeks on a grid covering the whole license area, and field activities concluded on Friday 11 May;

Sample preparation is being carried out and is scheduled to complete shortly after which XRF analysis (x-ray fluorescence spectrometry) will be carried out to identify anomalous levels of copper and cobalt;

Further reports to market will be provided as results become available and allowing for analysis by the Company’s technical team.

FFI Holdings (FFI.L) 17.5p £27.7m

FFI Holdings, the world leader in the provision of completion contracts to the entertainment industry and one of the largest providers of production services and equipment to film makers, confirmed that it expects Underlying EBIT will be within, but at the lower end of, the range of $7.5 to $11.5m set out in its trading statement of 4 Mar 2019.

Other than completion contracts, which has been exposed to a number of previously disclosed headwinds in the financial year, all of the Company’s divisions are expected to report trading in line with or ahead of the Board’s expectations.


ProPhotonix (PPIX.L) 2.75p £3.49m

ProPhotonix, a high technology designer and manufacturer of LED illumination systems and laser diode modules, with operations in Ireland and the United Kingdom, announced a trading update for the 2019 fiscal year.

Trading conditions remain challenging and the Board currently expects Group revenue for the year ending Dec 31, 2019 will not likely exceed the 2018 full year ($16.4m). Trading has been inconsistent across our customer base due to product introduction delays and the current business climate.  


Applied Graphene Materials (AGM.L) 25p £12.11m

Applied Graphene Materials, the producer of specialty graphene materials, announced that the Company has received patent approval for its unique manufacturing process in the 10 out of 11 territorial applications made in 2010.

This latest patent approval is in a strategically important territory for the Group and follows receipt of approval from the USA patent office in 2018.

As the Company deepens its dispersion expertise to enable the effective transfer of graphene’s unique combination of properties into customer materials, AGM continues to file patent applications for its proprietary manufacturing and dispersion processes, and products as appropriate, with a particular focus on graphene dispersions for paints and coatings.


Osirium Technologies (OSI.L) 77.5p £10.5m

Osirium Technologies, a leading vendor of cloud-based cybersecurity software, announced a significant three year contract extension with a leading global asset manager. The customer which has over £300bn of AUM and offices in c.30 countries has expanded its subscription for 3,000 to 4,500 devices.

The contract will be booked in the current financial year with revenue being released over the three year term. Under the terms of the contract, Osirium will deliver its full PxM product offering.


Churchill China (CHH.L) 1,560p £171.4m

Churchill China, the manufacturer of innovative performance ceramic products serving hospitality markets worldwide, will hold its AGM today. At the meeting, Alan McWalter, Chairman, will make the following statement:

“I am pleased to report that we continue to enjoy good trading levels across our business. We have made further progress since our Preliminary Results announcement in Mar 2019 and we remain confident that our full year performance will be in line with market expectations.

Growth has remained strong in Europe, supported by the opening of our Rotterdam distribution centre. Recent new product introductions continue to be well received, further improving the proportion of our revenue in sales of technically differentiated added value product.

We continue to create opportunities to develop our business and we have increased the level of investment within our operations in the first months of 2019 to support this. We expect this investment to continue as part of our long term approach to value generation. The integration of the Dudson brand and products purchased in April into Churchill is proceeding well.”


Hunters (HUNT.L) 43p £13.69m

Hunters, one of the UK’s largest franchised sales and lettings agency businesses, issues an AGM Statement and Trading Update for the first four months of the year, ahead of its AGM to be held today.  The Chairman, Kevin Hollinrake, will make the following statement:

“So far this year we have opened seven new Hunters branches against three for the same period last year.  Despite the market’s difficulties I am delighted to announce that the first half year is expected to end slightly better than the Board anticipated which puts us in a good position. As we approach H2 we expect some challenges in the market due to the tenant fee ban which we have already factored in having adopted our plans to manage the transition.  Given our strong sales profile our exposure is expected to be less significant than predominately lettings-based businesses. We believe that as the burden of regulation increases the demand from independent businesses to join our Network to take advantage of our portal discounts, technology, procurement and training and demonstrable record of improving revenue will prove even more compelling.

Finally, I am further delighted to announce our Customer Service Rating has continued at 96% across both sales and lettings and we retain a healthy pipeline of potential new franchisees seeking to join the network. I look forward to updating you further as the year progresses.”


Head Chef:

Derren Nathan
0203 764 2344

*A corporate client of Hybridan LLP


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