Small Cap Feast

Small Cap Feast – 22 January 2020

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Set Menu NEX Growth:

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Set Menu Standard List:

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Dish of the Day:

No Joiners Today

 

Off the Menu:

Charles Taylor is to leave the Main market (Premium) following a take over

 

Dish of the Day:

Off the Menu:

What’s Cooking in the IPO Kitchen?

AIM

Intention to float by Gemfields Group. No Capital Raise. Currently listed on JSE. (GML:JNB) at circa £122m.  The Group’s key producing assets, the Kagem emerald mine in Zambia  (believed to be the world’s single largest producing emerald mine) and the Montepuez ruby mine in Mozambique (one of the most significant recently discovered ruby deposits in the world), are both expected to have long mine-lives with potential for expansion. Also owns the  Faberge brand. Due Valentines Day 2020.

Main Market (Standard List)

The Proof Of Trust has announced its intention to list on the Standard Market.  The Blockchain based business, owns patents to a protocol which facilitates dispute resolution based upon smart contract disputes.  Transaction details TBC.

Main Market (Premium)

Calisen Group. Potential Intention to Float. Owner and manager of essential energy infrastructure assets through its subsidiaries Calvin Capital and Lowri Beck . Consolidated FY Dec 18 revenue £162.1m and operating profit £25.4m. Raising up to £300m in primary plus partial vendor sale.  Expected Admission February 2020

The Global Sustainable Farmland Income Trust will invest in a diversified portfolio of operational farmland assets located in major agricultural markets including the United States, Europe, New Zealand, Australia and certain countries within Latin and South America. Raising up to $300m.   Due 28 February.

Main Market (Specialist Funds)

Investment firm Nippon Active Value fund is seeking to raise up to £200m at an issue price of 100p per share via an IPO.   The company aims to invest in a portfolio of quoted Japanese stocks with market capitalisations of up to $1bn.   First day of dealings expected early February.

 

Breakfast Buffet

Deltex Medical (DEMG.L) 1.4p £7.3m

 FY Dec 19 update from the specialist in oesophageal Doppler monitoring.

In 2019 the Group made good progress with the execution of its new strategy. Costs were further reduced and a number of steps taken to refocus the business. Together these measures contributed to the generation of cash during the year and the creation of a stable platform to target profitable growth.

The healthcare market continues to evolve, particularly in the USA. The increasing focus on patient safety and reducing avoidable complications, such as acute kidney injuries, continues to help highlight the benefits of haemodynamic monitoring.  Pressure from ‘payers’ to lower hospital-related costs is also helpful.

Overall revenues for the year ended 31 December 2019 were approximately £4.3m (2018: £5.0m) reflecting the implementation of the new strategy focusing on generating profitable revenues and the cessation of the distribution of lower margin third-party products in the UK.  Deltex expects to report positive adjusted EBITDA for the year.

Cash on the balance sheet at 31 December 2019 was £0.9m (2018: £0.6m)

 

The Mission Group (TMG.L) 83.5p £71.2m

 Trading update from the alternative group for ambitious brands.

Expects to be in line with market expectations and to report ninth consecutive year of growth in headline profits.

2019 was undoubtedly a challenging year and, more than ever, many Clients left it until the final two months of the year to commit to spending. However, the structural, organisational, positioning and brand changes implemented during the year helped to offset this, and The Mission were delighted to broker the major sponsorship deal between lastminute.com and the London Eye towards the end of the year.

The very back-ended nature of  trading resulted in more working capital requirements at the end of the year than usual but, nevertheless, again expects to report a net bank debt to EBITDA ratio of below x0.5. If the trading profile across the year returns to more normal patterns,  expects the Group to be debt free/cash positive at the end of 2020.

 

Regency Mines (RGM.L) 3.15p £2.7m

Update on its flagship Mambare nickel-cobalt project (Papua New Guinea) following recent successful partner engagements.

Highlights:

o  230km Line cutting completed and a ground penetrating radar (“GPR”) exploration programme underway, targeting 200km of surveys  

o  Environmental Permit application submitted

o  Exploration Lease renewal process underway

o  Mining Lease application material being finalised

o  Joint Venture partners aligned on forward programme

 

Alliance Pharma (APH.L) 84.5p £447m

 FY Dec 19 update from  international healthcare group.

See-through revenue for 2019 showed strong growth of 16% on the prior year at £144.3m (2018: £124.0m). Excluding acquisitions, year on year revenue increased 9% in 2019. Underlying profit before tax is expected to be in line with expectations.

Brand highlights:

Kelo-cote™ delivered another very strong performance, with revenues of £31.0m, an increase of 38% on the prior year due to continued strong demand from the Asia Pacific region

Nizoral™ (under J&J management in 2019) performed in line with expectations generating see-through revenues of £20.2m, compared with £10.9m H2 2018

  • MacuShield™ saw strong growth in 2019, with revenues up 18% at £8.2m (2018: £7.0m)
  • Vamousse™ delivered another strong performance, achieving revenues of £6.5m, up 14% on the previous year (2018: £5.8m), and up 10% on a constant currency basis, reflecting continued out-performance against the general market in the US, its main sales territory

 

Oriole Resources (ORR.L) 0.495p £3.47m

Update on its Bibemi gold project in Cameroon, where it is earning up to a 90% interest through its partnership with Bureau d’Etudes et d’Investigations Géologico-minières, Géotechniques et Géophysiques SARL (“BEIG3”). Recent mapping over the main Bakassi area has confirmed the continuation of mineralisation in Zone 1 by 1.3 kilometres to over 5.0 kilometres, with rock-chip samples from stacked veins returning up to 35.86g per tonnes  gold

 Highlights

Drill collars pegged for planned 1,500 metre initial drill programme;

Rock-chip sampling of ‘Category 1’ quartz tourmaline veins all mineralised, returning up to 35.86 g/t Au;

Mapping over north-east Bakassi zone confirms mineralisation continues over more than 5.0 kilometres – presence of stacked veins is highly prospective for enhanced concentrations of gold mineralisation;

Further drill holes being planned to test north-eastern Bakassi area.

 

Van Elle Holdings (VANL.L) 48.5p £38.8m

HY Oct 19 update from the geotechnical engineering company offering a wide range of ground engineering techniques and services to customers in a variety of UK construction end markets. Despite a challenging market backdrop, the benefit of self-help initiatives and revenue growth resulted in an improving performance as the half progressed.

Revenue grew by 13.1% to £48.5m, reflecting growth in the housing and highways markets, contrasted with subdued conditions in commercial and rail markets.     Underlying PBT reduced to £1.1m (H1 2019: £2.8m), reflecting a weak first quarter and adverse sales mix across the period

Progress against the previously announced transformation programme remains on track, with phase 1 now substantially complete:

Whilst mindful of the ongoing volatility across construction markets, the Board expects the Group to make further progress in H2, and to deliver results for the full year within the range of market expectations.

 

PPHE Hotels (PPH.L) 2010p £853m

 Promotions of Greg Hegarty to Deputy Chief Executive Officer & Chief Operating Officer (Deputy CEO & COO) and Inbar Zilberman to Chief Corporate & Legal Officer earlier this month.   Greg remains Chief Operating Officer (COO) and within this remit will continue to oversee the Company’s operations. Greg has excelled in his role as COO, leading the company to receive a number of prominent industry awards, including the AA Large Hotel Group of the Year award for 2019-2020. Greg has been instrumental in successfully delivering PPHE’s multi-year £100 million plus hotel investment programme across the United Kingdom and the Netherlands .

Inbar joined PPHE in 2010 and, prior to promotion, was the Company’s General Counsel. In her new role, alongside her existing leadership of the Group’s legal and compliance functions, she will oversee the Group’s corporate initiatives including acquisitions and expansion, corporate governance and corporate social responsibility.

 

Tissue Regenix Group (TRX.L) 1.475p £17.3m

FY Dec 19 Update from the regenerative medical devices company.

The Group expects to deliver revenue and EBITDA in line with its revised expectations as reported on 17 October 2019. Revenue is anticipated to be £13m.

  • Cash position of £2.4m provides cash runway until at least the end of April 2020
  • Board continues to evaluate various funding options.

As a result of various initiatives, the average number of orthopaedic donors processed monthly  at the San Antonio facility has more than doubled from Q1 to Q4. It is important to note that there is typically at least a three-month lag between increased donor processing and increased product available for sale .

 

Pebble Group (PEBB.L) 147.5p £247m

 The provider of products, services and technology to the global promotional products industry, announced that its results for the year ended 31 December 2019, which are expected to be in line with expectations, will be issued on 2 April 2020. The Group has maintained good momentum since its successful IPO and admission to trading on the AIM market of the London Stock Exchange on 5 December 2019, and the Board looks ahead to 2020 positively.

 

Sumo Group (SUMO.L) 196.25p £295.6m

 FY Dec 19 update from the award-winning provider of creative and development services to the video games and entertainment industries. Results are expected to be at least in line with market expectations. A number of significant contracts were secured towards the end of 2019 which underpin the Group’s financial forecasts for the year ahead.  Cash balances of £12.9m headcount of 766 people, an increase of 174

 

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

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