Small Cap Feast

Small Cap Feast – 28 March 2019

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 903

Total number of AIM Companies trading: 833*
* As at 22 March 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 22 March 2019

Set Menu Standard List:

Total number of Standard List Companies (Incl Susp): 161*

Total number of Standard List Companies trading: 141*
* As at 22 March 2019

Dish of the Day:

$477m Ferro-Alloy Resources Limited, the vanadium mining and mineral processing company focused on Southern Kazakhstan, has join the Standard List. Raising £5.25m at 70p with market cap of £219m. FAR.L

Standard list Introduction of Coca-Cola European Partners (CCEP.L) the world’s largest Coca-Cola bottler by revenue, generating sales last year of €11.5bn and operating profit of €1.6bn, operating across 13 countries in Western Europe.  Has other European and NYSE listings.

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)

US Solar Fund, a newly-established investment company focused on investing in solar power assets mainly in the US, looking to raise $250m at $1. Expected 16 April

AIM

Network International Holdings—Pleading enabler of digital commerce across the Middle East and Africa  region, operating across over 50 highly underpenetrated payment markets that contain a total population of 1.5 bn. 2018 rev $298m, underlying EBITDA $152m.  Due April. No new funds to be raised. Secondary sell down. Targeting 25% of at least 25%.

Techniplas –global  producer and support services company providing highly engineered and technically complex components, making the supply chain to original equipment manufacturers more efficient.  FYDec17 rev $515m.

Breakfast Buffet

Secure Trust Bank (STB.L) 1,325p £236.4m

FYDec18 results.

Adjusted PBT up 35.9% to £36.7m (2017*: £27m) and is in line with market expectations

Reported PBT is up 38.8% to £34.7m (2017: £25m)

Higher quality book has significantly reduced cost of risk

Total customer numbers increased by 29.3% to 1,279,783

Customer deposits increased to £1,847.7m (2017: £1,483.2m) up 24.6%

New digital deposits platform successfully operational with new products to be launched in 2019

“Assuming an orderly exit from the EU we expect the UK economic outlook to improve which the Group will seek to leverage as it continues to execute its clearly defined growth strategy.”

 

Adnams (NEX:ADB) 9,750p £27.9m

“FY18 results from the  UK brewer, hotelier and wine merchant. £78.9m our turnover was 5.6% ahead of 2017 and our beer volumes grew by 2.2%. Operating profit before highlighted items, at £1.6m, was behind the £2.2m that we made in 2017. Our EBITDA remained robust at £5.2m, slightly down from £5.4m in 2017, before charging the non-cash highlighted items.

Adnams has the advantage that it is primarily a UK-based business and whilst we have plans to secure necessary imports and to continue the growth of our export business, our main concerns relate to consumer confidence and availability of suitably skilled staff including those in our wider supply chain and customer base. There is little that we can do about these matters, other than to try to ensure that we remain nimble and able to respond quickly to our markets as they change. This we will seek to do.”

 

Tekmar Group (TGP.L) 107p £51.96m

Acquisition of 80% of Ryder Geotechnical. Ryder Geotechnical, founded by Fraser Gibson in 2016, provides expert geotechnical design and consulting services to the offshore wind and subsea oil and gas sectors.

Offshore geotechnical engineering is a specialist branch of civil engineering, focused on the assessment of seabed properties and the design of subsea infrastructure to ensure the stability of offshore assets. Ryder Geotechnical’s activities include structure foundation design, geohazard assessment and subsea cable routing and burial assessment. Nominal consideration of £2 with option to acquire the remaining 20% for a maximum consideration of £2m. Founder, Fraser Gibson will continue to lead Ryder Geotechnical as Managing Director.  Ryder FYNov17 rev £102k, profit £48k.

 

7digital (7DIG.L) 1.25p £4.3m

The specialist in B2B end-to-end digital music solutions, announced that it has signed a contract with Dubset Media, Inc.  

7digital has agreed an initial one year deal with Dubset, a rights tech company that identifies, claims, and collects royalties for labels and publishers when their catalogues are found within mix content. This clearance process enables DJs and producers to legally distribute their mixes and remixes to major music services including Apple Music, Spotify, and Tidal. Under the terms of the deal, 7digital will provide access to the Company’s music platform to assist Dubset in further enhancing its proprietary MixSCAN recognition technologies.

Commercial terms are confidential but the deal will contribute to 7digital’s monthly recurring revenues for 2019 and the company will receive a significant set-up fee.

 

European Lithium (NEX:EUR) 0.085p £47.5m

The definitive feasibility study (DFS) at the Company’s advanced Wolfsberg Lithium Project, in Austria, has been achieved.

The quality of the final product after sorting (cleaner product) is similar in quality as the products yielded after sorting of the samples as received (scavenger product). The lithium recovery in the cleaner product was in the range of 53.2 to 67.6 wt.-%. Significant amounts of lithium is also in the cleaner tailings and scavenger product (6.3 to 19.6 wt.-%). These two products are recirculated in the commercial process, therefore, most of the lithium in these products should be recoverable. “It is a significant milestone to achieve during the company’s complex metallurgical testwork. These results prove the ore can be treated from AHP and MHP sources and can be sorted in different ways to achieve repeatable and consistent high quality products.”

 

genedrive (GDR.L) 23.5p £7.99m

The near patient molecular diagnostics company, announced unaudited interim results for the six months to 31 Dec 2018.

Total revenue and other income of £1.5m (2017: £1.3m) reflecting a shift to commercial revenues from development grant revenue

Continued R&D spend giving rise to a pre-tax loss of £1.7m (2017: £2.3m)

Successful fundraise of £6m gross.

Delays in country registrations for the  Genedrive® HCV-ID Kit. “Nevertheless we still expect to deliver around 25% growth in full year revenue and other income compared to those recorded for the year ended 30 June 2018 – excluding any further sales that may be generated from additional uptake of our HCV assay and further DoD orders beyond those already announced.”

Capital for Colleagues (NEX:CFCP) 45p £6.9m

“The investment vehicle focused on opportunities in the Employee Owned Business  sector, announced an investment update in respect of the six months ended 28 Feb 2019.

Portfolio comprised of 17 unquoted EOBs at the end of the six months (31 Aug 2018: 17)

NAV of  £7.4m (31 Aug 2018: £6.8m)

NAV per share increased by more than 8.8% to 48.05p (31 Aug 2018: 44.15p per share)

“I am delighted to be able to report a robust investment performance as I pass my executive responsibilities to Alistair Currie. We have established a diverse and balanced portfolio for the Company, and I am confident that Capital for Colleagues and its shareholders will benefit as the portfolio matures and as we continue to expand our exposure to the exciting EOB sector”.

 

Mercia Technology (MERC.L) 35.7p £110m

The national investment group focused on the identification, creation, funding and scaling of innovative technology businesses with high-growth potential from the UK regions, announced that its portfolio company, Oxford Genetics Limited, has received £6.5m of new investment in a syndicated round comprising Canaccord Genuity Limited, Invesco Asset Management Limited and Mercia. Mercia invested £0.4m as part of the new funding round which now values Oxford Genetics at an undiluted, post-money valuation of £30.5m.

We have backed Oxford Genetics since day one, working closely with Ryan who has built both an impressive team and a highly scalable business model. Full year revenue to April 2019 is set to achieve c.300% growth on last year”.

 

Mattioli Woods (MTW.L) 777p £206.3m

Acquisition of SSAS Solutions for £4.01m. SSAS Solutions was established in 2009 and provides a bespoke, specialist pension advisory service for the operation of small self-administered pension schemes (“SSAS”).  Based in Belfast and employing 12 staff, the business provides personal service and expert technical advice to owner-managed businesses throughout the UK, acting as SSAS practitioner to 350 schemes with approximately £380m of assets under administration. Initial consideration £2.5m in ab blend of cash and shares plus £1,5m earn out. 

“The transaction gives us an exciting new distribution channel for Mattioli Woods’ services, with the opportunity to enhance the existing client offering to include SIPPs. I believe extending our geographic footprint strengthens our position, making the Group the only SSAS and SIPP operator based in Northern Ireland.”

 

IGas Energy (IGAS.L) 73.2p £90.37m

Cash balances as at 31 Dec 2018 of £15.1m and net debt of £6.4m

Net cash generated from operating activities for the year was £12.9m (2017: £6.7m), after oil hedge payments of £5.5m

Improved underlying profit of £4m (2017: £1.3m). Loss after tax of £21.4m due to non-cash exploration write-offs, principally in relation to the Doe Green long-term test, of £29.1m (2017: Profit after tax of £15.5m due to tax credit of £19.1m)

Carried work programme of up to $220m (£170m) as at 31 Dec 2018

525,000 barrels hedged for 2019 with an average put price of $58.5/bbl

“As shown by the 200% reserves replacement in 2018 there is still significant upside in our conventional portfolio and we look forward to bringing projects to final investment decision over the coming months.”

 

Head Chef:

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

*A corporate client of Hybridan LLP

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