Small Cap Feast

Small Cap Feast – June 25 2019

Dish of the Day:

Alumasc Group has joined AIM after transferring from the Main Market

Argentex (AGFX.L), a FCA regulated provider of foreign exchange services to institutions, corporates and high net worth private individuals,  has been admitted to AIM after raising £14m at 106p with a market cap on admission of £120m.

Off the Menu:

No Leavers Today

What’s Cooking in the IPO Kitchen?

NEX Exchange

Clean Invest Africa (NEX:CIA)—readmission and all share RTO of CoalTech (South Africa) engaged in agglomerating coal fines into coal pellets through the commercialisation o f its proprietary binding technology. Due early Aug.

Main Market (Premium)

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. TBC

Rumours & Speculation

Neptune Surf Technology plc*, a vertically integrated lifestyle accessory group focused on the surf market, designing its own high-performance wetsuits and surfing hardware and distributing these together with third party brands globally with key markets being Europe, Australia and USA and Brazil, is looking to join AIM and ‘is planning an £11m float’ according to The Sunday Telegraph.

Breakfast Buffet

Cerillion (CER.L) 170p £48.25m

Cerillion, the billing, charging and customer relationship management software solutions provider, announced a major new contract win worth an initial £4.8m with LINK Mobility, Europe’s leading provider of SMS and message delivery solutions. This win supports existing market forecasts and continues the Company’s trend towards securing larger deals, following the £5.1m contract win announced on 14 June.

The contract is for the supply and installation of Cerillion’s Enterprise BSS/OSS* suite to support LINK Mobility’s growth across multiple international territories, in what will be an extensive transformation project. The initial implementation will be delivered over the next nine months.

Cerillion’s solution will provide back office and operational support systems, including CRM, billing, convergent charging, order management, workflow and network provisioning.

Pressure Technologies (PRES.L) 123p £24.7m

Pressure Technologies, the specialist engineering group, announced its interim results for the 26 weeks to 30 March 2019.

Group revenue up 59% to £14.5m (2018: £9.1m)

Gross profit up 73% to £5m (2018: £2.9m)

Adjusted operating profit at £1.3m (2018: loss £(0.1)m)

Reported PBT of £0.1m (2018: loss £(1.5)m)

Reported basic EPS of 1.6p (2018: loss (5.5)p)

Adjusted operating cash inflow of £0.7m (2018: outflow £2.2m)

Net banking facility debt of £7.9 million (£8.4m at 31 March 2018; £5.7m at 29 Sept 2018)

Thor Mining (THOR.L) 0.88p £6.94m

The Board of Thor Mining Plc advised that samples from historical drilling at the 100% owned Pilot Mountain in Nevada USA are to be re-assayed for gold. This follows gold assays received with metallurgical test work results from drill samples from the Desert Schelte deposit.

Up to 1,200 samples from 27 drill holes from drilling programs between 2012 and 2017 to be re-assayed;

Assaying to be conducted on drill samples from each of Desert Schelte, Garnet, and Good Hope deposits;

Gold assays of 0.29g/t in the initial metallurgical process feed, and 0.33g/t in the combined tailings.

“This is potentially a very exciting phase for our 100% owned Pilot Mountain project.”

“In the event that gold appears with any consistency in the Pilot Mountain deposits, we may have a step change of substance for this project”.

Tekcapital (TEK.L) 11.25p £6.11m

Tekcapital, the UK intellectual property (IP) investment group focused on creating marketplace value from investing in university technology, announced that its portfolio company Guident Ltd has exclusively licensed patent application PCT US19 14 547 entitled: “Visual sensor fusion and data sharing across connected vehicles for active safety” from Michigan State University.

This important patent application describes methods for enhancing the safety of AV’s by enabling them to share information with other AV’s and drones regarding objects detected by their sensors. This proprietary method may improve safety by providing a more robust, real-time system for detecting pedestrians, traffic conditions and potential hazards.

Kingswood Holdings (KWG.L) 7.6p £12.34m

Kingswood Holdings, the integrated wealth management group, provided the following corporate update in relation to the Company’s acquisition pipeline and the funding for that pipeline.

As announced in the Company’s final results on 15 April 2019, the Company has an acquisition pipeline in excess of £100m and the Board has continued to explore opportunities to source additional funding to support the execution of this pipeline. The Company confirms that it has agreed non-binding heads of terms with a provider of substantial permanent growth capital with regards to a potential equity investment in the form of convertible preference shares and is now undertaking an extensive due diligence exercise. This injection of capital would be consistent with the Group’s stated strategy of pursuing accretive acquisitions across the UK and internationally, a number of which are in advanced stages of negotiation with due diligence being undertaken.

Bigblu Broadband (BBB.L) 113p £62.21m

Bigblu Broadband, a leading provider of alternative fast broadband services, provides a trading update for the six-month period ended 31 May 2019.

Total revenue increased 21.5% to £30.5m (H1 18: £25.1m)

Like-for-like organic revenue growth* on a constant currency basis of 12% (FY18: 8.2%)

Gross margin expanded to 43.7% (H1 18: 37.4%) due to improved product mix and network support

Underlying EBITDA** increased 54% to £4.3m (H1 18: £2.8m)

Total number of customers increased 7% during the period

50 Mbps download speeds now available to all European customers

The Company continues to be the largest single connector of new customers to the Australian national NBN satellite broadband scheme with a consistent market share of over 50% over the last nine months.

Quickline, the Company’s wholly owned subsidiary focussed on fixed wireless broadband, has almost doubled customer numbers since acquisition two years ago (currently at c7.6k).

Redcentric (RCN.L) 80p £119.61m

Redcentric, a leading UK IT managed services provider, announced its full year results for the year ended 31 March 2019.

Revenue of £93.3m (FY18: £100m), including £81m (86%) of recurring revenue (FY18: £87.1m, 87%)

£16.7m (FY18: £18.1m) and adjusted EBITDA margin of 17.9% (FY18 18.1%)

Adjusted basic EPS of 3.89p (FY18: 4.35p). Statutory EPS of (1.32)p (FY18: 0.34p)

Adjusted cash flow from operations of £21.3m (FY18: £22.6m)

Net debt reduction of £10.1m to £17.6m (FY18: £27.7m)

Enhanced dividend policy announced with a cover of 2x adjusted earnings, doubling the pay-out ratio announced at the half year

Final dividend of 1p per share resulting in a total dividend for the year of 1.4p

The Board to request authority for a share buyback programme of up to 5% of the issued share capital at the upcoming AGM

IronRidge Resources (IRR.L) 14.47p £44.11m

IronRidge Resources, the African focussed minerals exploration company, announced that additional X-Ray Diffraction (‘XRD’) analysis of metallurgical composites reaffirms spodumene as the dominant lithium mineral phase; one of several targets within the Cape Coast Lithium Portfolio, located in Ghana, West Africa.

Additional X-Ray Diffraction (‘XRD’) results returned for metallurgical test-work on gravity concentrates and residues reaffirm spodumene as the dominant lithium mineral phase in all ten (10) composites analysed.

Majority of lithium reports to spodumene providing confidence in simple process flow-sheet design and good customer acceptance; very low level to trace amounts of undesirable petalite, eucryptite, lepidolite and amblygonite observed.

Very low level to trace lithium phases reporting in residue material; minimal lithium losses to waste envisaged.

Good spread of tested metallurgical composites across the Ewoyaa deposit footprint; provides confidence in continuity of spodumene dominant mineralogy with simplified process flowsheet and mine planning envisioned.

Armadale Capital (ACP.L) 1.38p £4.79m

Armadale Capital, the investment group focused on natural resource projects in Africa, announced exceptionally high-grade assay results from its Mahenge Liandu Graphite Project in Tanzania, which validate commercialisation plans in progression.

First four of 18-hole reverse circulation (‘RC’) drill programme received

Exceptionally high-grade near surface assayed intercepts recorded

7m @ 16.9% total graphite content (‘TGC’) from 31m

7m @ 16.8% TGC from surface

9m @ 14.8% TGC from surface

Encouraging results are part of broader zone of high-grade mineralisation that includes 39m @ 11.2% TGC from surface, 57m @ 7.6% TGC from surface and 63m @ 8% TGC from 12m

Wide zones of high-grade near surface mineralisation materially above the 12.5% used in the average life of mine scoping study completed in March 2018

Eight diamond drill-holes also drilled and are currently being assayed

Results have favourable impact on the Project’s economics and forward commercialisation plans:

Higher average grade from near surface mining in early years

Lower extraction costs

Potential enhanced EBITDA margins

Results expected to have a positive outcome on the Definitive Feasibility Study (‘DFS’) on track to complete Q4 2019, aiding transition from exploration to mining phase

iEnergizer (IBPO.L) 228p £391.6m

iEnergizer, the technology services and media solutions leader for the digital age, reports annual results for the year ended March 31, 2019 with continued high revenue and margin growth generating a substantial return and dividend payment to shareholders.

Revenue up 11.8% (2018: 6.4%) at $174.1m (2018: $155.7m)

Significant EBITDA growth up 29.7% (2018: 10.0%) with record levels of EBITDA generating $50.1m (2018: $38.6m)

EBITDA margin at 28.3% (2018: 24.6%)

Operating Profit up 35.9% at $45.3m (2018: $33.3m)

Operating Profit margin increased to 25.7% (2018: 21.2%)

PBT up 47.1% at $40.8m (2018: $27.8m)

PBT margin increased to 23.1% (2018: 17.7%)

EPS $0.17 (2018: $0.11)

Proposing dividend of 10.4p per ordinary share (total $25.1m) (2018:  nil p) and the Company intends to adopt a progressive dividend policy going forward

Reduced net Debt to $3.9m (2018: $26.4m)

Refinancing successfully accomplished post year end in April 2019 for an aggregate 5 year term loan of $45.5m

Head Chef:

Derren Nathan
0203 764 2344

*A corporate client of Hybridan LLP


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