Small Cap Feast

Small Cap Feast – 23 July 2019

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 888

Total number of AIM Companies trading: 806*
* As at 23 July 2019

Set Menu NEX Growth:

Total number of NEX Growth Market Companies (Incl Susp): 87*

Total number of NEX Growth Market Companies trading: 85*
* As at 23 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 23 July 2019

Dish of the Day:

MetalNRG (MNRG)  The Company that invests in and focuses on acquiring companies and projects within the natural resources sector will be delisted from NEX Exchange Growth Market simultaneously with the LSE admission.

Off the Menu:

Patagonia Gold Plc (PGD) has been cancelled from AIM after being acquired by HUNT Mining corp.

Dish of the Day:

No Joiners Today

Off the Menu:

MetalNRG (MNRG)  The Company that invests in and focuses on acquiring companies and projects within the natural resources sector will be delisted from NEX Exchange Growth Market simultaneously with the LSE admission.

What’s Cooking in the IPO Kitchen?

Main Market

Interswitch, a Nigeria-based payments firm, has hired advisers to resurrect plans for a stock-market listing in London and Lagos later this year, which may value the financial technology company at $1.3 billion to $1.5 billion.

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

Roxi Music UK music streaming service plans London IPO as it goes up against Spotify. They have appointed investment bank Arden Partners for an initial public offering (IPO) on the London Stock Exchange later this year.

NEX

Freyherr International Group PLC the Medicinal Cannabis holding company established in 2016,  is planning to list on the NEX exchange on the 30th July

Breakfast Buffet

DX Group (DX.) 12.97p £74.44m

DX, the provider of delivery solutions, including parcel freight, secure, courier and logistics services, announced the following pre-close trading update for the financial year ended 30 June 2019.

The Board announced that results are expected to be in line with market forecasts, with DX moving back into profitability, generating EBITDA of £3.2m (2018: EBITDA loss of £4.9m) from revenue up by 8% to c. £322.5m, (2018: £299.5m). Net debt at the year-end is expected to be significantly better than forecast at approximately £1.3m (30 June 2018: £1.1m). This is after a £3.3m capital investment in the business and reflects improved working capital management.

Both DX Freight and DX Express contributed to the improvement. DX Freight, which includes the Group’s irregular dimensions & weight and logistics activities, benefitted from significant improvements in operational efficiency and customer service. It continues to secure healthy levels of new business, which is improving the utilisation of the existing capacity in its network.

DX Express, which includes DX Exchange, Secure and Courier services, has further slowed the rate of attrition of the annuity revenue at the Document Exchange. Its Courier offering is growing, which will help offset the impact of the non-renewal of the HMPO contract due to expire in January 2020, as previously announced on 28 May 2019.

The Group is well-positioned to make further progress in the new financial year and remains on track to achieve market forecasts of EBITDA of £7.7m, as reported on 28 May 2019.

Beeks Fin Cloud Grp (BKS) 79.50p £39.59m

Beeks Financial Cloud Group, a cloud computing and connectivity provider for financial markets, announced the signing of two additional substantial Tier 1  clients: a global investment management organisation and a global bank.

Beeks will provide the global investment management organisation with managed connectivity to support its fixed income platform. Beeks’ low-latency capabilities and strong network of pre-built connections means it can supply a fully managed setup for the client’s operational requirements. The contract is worth approximately £500,000 over the initial two-year period.

The global bank has contracted with Beeks’ via a partner for the delivery of an initial proof of concept for a fixed income implementation. This proof of concept is revenue generating and is currently live with the bank. It is anticipated to be a pre-cursor to an extensive deployment with the client.

These wins build on the announcement of Beeks’ first Tier 1 customer in Dec 2018, from within the insurance sector, and add to the Company’s growing portfolio in the Fixed Income asset class.

The Board confirmed the Group traded in line with expectations for the year ended 30 June 2019 and looks forward to providing a further update at the time of the Final Results, to be released in late August.

Secure Income REIT (SIR) 401p £1,294m

The Board of Secure Income REIT announced the sale of a portfolio of eight of its nineteen private hospitals let to Ramsay Health Care Limited for a gross consideration of £347m. The assets sold represent 31% of Ramsay hospitals owned by the Company, at their 31 Dec 2018 valuations.

The purchaser is Medical Properties Trust, the US specialist healthcare REIT capitalised at some $7.8bn. The occupational leases have a current net rent payable of £16m per annum. Unconditional contracts for the sale of the eight subsidiary companies that hold the properties have been exchanged and completion is scheduled for 16 Aug 2019.

The eight hospitals sold are Ashtead, Berkshire Independent, Euxton Hall, Mount Stuart, North Downs, Renacres, Rowley and Winfield.

The impact of the disposal on the Group with effect from completion of the sale will be to:

Reduce the Group’s net debt by approximately £316 million which will reduce the Group’s Net Loan to Value Ratio from 43.0% at 31 December 2018 to 33.5% on a pro forma basis, adjusting only for the disposal;

Increase EPRA NAV per share by an estimated 6.9p per share after payment of estimated debt redemption costs payable at completion and all other costs of sale, together estimated at £32.4m;

Increase uncommitted cash by over £170m to in excess of £200m on a pro forma basis; and

Increase the Weighted Average Unexpired Lease Term of the Group’s portfolio by 0.3 years.

Smartspace Software (SMRT) 88.50p £19.39m

SmartSpace Software the leading provider of ‘Integrated Space Management Software’ for smart buildings, commercial spaces and hospitality, provided a progress update on its subsidiary, SwipedOn, which it acquired in Oct 2018. SwipedOn’s technology is focused on visitor management software, based on a SaaS model.

SwipedOn has successfully grown its customer numbers by 50% since being acquired and now boasts over 3,300 customers in over 4,300 locations globally

Paying users in over 40 countries

First step to broadening addressable market with launch of Dutch-language version of visitor management platform in the Netherlands

First additional module ‘Deliveries’ recently released streamlining delivery process

Whilst SwipedOn currently has paying users in over 40 countries, to date the system has only been offered in the English-language version. As part of the initiative to broaden the addressable market for SwipedOn and grow the customer base the Company announces the launch of a Dutch-language version in the Netherlands. This is the first time SwipedOn has released a non-English language version of its visitor management solution. In the coming months, SwipedOn plans to release in other non-English markets.

dotDigital Group plc (DOTD) 100p £290.53m

dotdigital Group, the leading ‘SaaS’ provider of an omnichannel marketing automation and customer engagement platform, announced the following trading update ahead of the publication of its full year results for the year ended 30 Jun 2019 in Oct. The trading performance in this statement is based on unaudited initial management estimates.

Group revenues grew by c. 19% to £51.3m (2018: £43.1m)

Organic revenue from continuing operations grew by c.15% to £42.5m (2018: £36.9m)

Adjusted EBITDA and operating profit from continued operations are expected to be slightly ahead of market expectations;

strong cash balance at 30 June 2019 of £19.3m which is ahead of consensus due to effective cash conversion;

ARPU continued its upward trend, growing by 14% from approximately £845 per month to £966 per month;

Recurring revenue as a percentage of total revenue increased to 86% from 85%;

Comapi fully integrated and Dynmark and Donky business units being discontinued to increase focus in the core dotdigital SaaS-based marketing platform (as announced 22nd May 2019).

Seeing Machines Ltd (SEE) 3.92p £124.51m

Seeing Machines, the advanced computer vision technology company that designs AI-powered operator monitoring systems to improve transport safety, has been selected by a major automotive Tier 1 supplier, to deliver its FOVIO driver monitoring platform into additional car models for an existing German OEM customer. The expanded deployment includes variants targeting European New Car Assessment Programme safety goals.

Euro NCAP is the European body responsible for vehicle safety ratings and testing. Its 2025 “Vision Zero” roadmap outlines the use of safety features including Driver Monitoring Systems (DMS), Automatic Emergency Braking, and Lane Keeping Assistance, to achieve advanced (4 or 5 star) safety ratings. This safety approach has been further substantiated by European Parliament direction which has called for mandatory installation of all three systems, in all new car models sold in Europe starting as soon as 2022.

The expanded engagement, scheduled for production from 2021, is expected to deliver incremental revenue between A$11m and A$30m.

GAN PLC (GAN) 70.50p £60.07m

GAN, an award-winning developer and supplier of enterprise-level B2B Internet gambling software, services and online gaming content in the United States, announced that GAN and Greenwood Gaming & Entertainment, Inc. trading as ‘Parx Casino’ launched 24/7 Internet casino gaming in the Commonwealth of Pennsylvania on Wednesday July 17.  This launch represents the second major launch of online services for Parx Casino, following the launch of internet sports betting on June 24, 2019.  

At launch, Parx Casino was the only Internet casino offering the #1 market leading table game online, ‘Pro Blackjack’, developed and delivered by GAN to be compliant with Pennsylvania’s specifically-approved blackjack game rules. A total of 47 casino games were released via desktop and mobile web together with an Android-compatible mobile App.

Selected casino slots and table games were delivered online for GAN’s Development & Distribution clients, including major U.S. casino equipment manufacturers’ Incredible Technologies, Everi Holdings, DEQ and KONAMI.

United Oil & Gas PLC (UOG) 4.05p £14.00m

Further to the conditional acquisition of Rockhopper Egypt Pty Limited RNS announced this morning, United Oil & Gas, the oil and gas exploration and development company, announces that by virtue of its size, the proposed acquisition of Rockhopper Egypt would constitute a reverse takeover under AIM Rule 14.

Further announcements will be made, as appropriate, in due course.

Proposed Fundraise

The Directors intend to undertake an equity fundraise in connection with the Acquisition. The proceeds of the proposed fundraise will be used to fund the Acquisition, support the enlarged Group’s business plan and for general working capital. Further details will be announced in due course.      

Renalytix AI PLC (RENX) 265p £148m

Renalytix AI, a developer of artificial intelligence enabled clinical diagnostics for kidney disease, announced its intention to conduct a placing of a minimum of 4,800,000 new ordinary shares in the Company at a price of 250p per share to raise minimum gross proceeds for the Company of £12m (approximately $15m).

Cohort PLC (CHRT) 440p £180m

Cohort, the independent technology business, announced that its wholly-owned subsidiary MASS has been awarded a contract to supply services valued at £4.79m for Electronic Warfare Operation Support to an export customer. The contract will utilise MASS’s uniquely experienced Subject Matter Experts to protect combat aircraft against missile threats. Delivery of this contract will take place over a nine-year period.

Head Chef:

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

*A corporate client of Hybridan LLP

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