Small Cap Feast

Small Cap Feast – Small Cap Feast 18/02/2019

Set Menu AIM:

Total number of AIM Companies (Incl Susp): 910

Total number of AIM Companies trading: 841*
* As at 15 February 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 15 February 2019

Set Menu Standard List:

Total number of Standard List Companies (Incl Susp): 145*

Total number of Standard List Companies trading: 128*
* As at 15 February 2019

Dish of the Day:

No Joiners Today

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)

DWF, a global legal business,  expects to raise primary gross proceeds of approximately £75m. Due March

AIM

United Oil & Gas (UOG.L) an oil and gas exploration and development company brought to the Official List (Standard Segment) in July 2017 by way of a reverse takeover of Senterra Energy plc. No capital to be raised, expected market cap of £17m and expected 28 Feb

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.

Polemos, to be renamed Digitalbox plc, has agreed to acquire Digitalbox Publishing Holdings Limited for c.£10m through a share for share exchange. The acquisition constitutes a RTO. Polemos has also agreed to acquire the entire issued share capital of Mashed Productions Limited, a digital media business which owns the online satirical news website “The Daily Mash”, for a maximum total consideration of up to £1.2m. Market cap on admission £12.4m, expected 28 February

 

Breakfast Buffet

Crossword Cybersecurity* (CCS.L) 320p £14.74m

The technology commercialisation company focusing exclusively on the cyber security sector, announced that it has signed an agreement with Kinnerton Confectionary regarding the use of Crossword’s secure Third-party Assurance platform, Rizikon Assurance. 

Kinnerton Confectionery is Britain’s largest independent manufacturer of chocolate and novelty confectionery specialising in character merchandising. From humble beginnings in 1978, the company has grown to service a range of customers and is proud to be one of the few UK confectionery companies able to offer ‘nut safe’ chocolate.

Rizikon Assurance is a secure, encrypted portal used by organisations to assure their third parties and suppliers.  It contains standard questionnaires on subjects such as cyber security, GDPR, supplier on-boarding, modern slavery and anti-bribery & corruption, and also supports the customer’s own question sets and scoring approaches.  It improves the scalability, security and auditability of third party assurance and due diligence via automation, centralisation and encryption.

 

Yourgene Health (YGEN.L) 13.88p £54.3m

The international molecular diagnostics group which commercialises genetic products and services, announces a restructuring of its financial and commercial relationship with Life Technologies Limited.

Life Tech to own 9% on warrant exercise locked in for three years.  £12.7m debt write off.

Yourgene will, once cashflow positive, pay a modest commission on sales within Southeast Asia under the new commercial agreement described below, up to a cap of £6.5m

Yourgene will establish a contingent liability of £6.5m which crystallises only in the event of a sale of the Company or its insolvency.

New agreement to be entered into granting Life Technologies a three-year period of exclusivity for the Company’s NIPT (non-invasive prenatal testing) products in Southeast Asia.

 

Alien Metals (UFO.L) 0.04p £0.32m

The mining exploration and development company, announced  an exploration update for its twelve wholly owned silver concessions in Zacatecas State, Mexico and details of its planned 2019 exploration programme. Within this portfolio are the Donovan 2 concession, which lies within close proximity of the San Nicolas copper zinc deposit, and the San Celso concession which consists of high-grade, low sulfidation epithermal veins. Further to the Company’s announcement of 26 Sept 2018, the Company undertook a comprehensive review of the asset portfolio in Sept 2018 which then prompted further prospecting and field mapping campaigns over the entire 1,500 hectare concession area in Nov and Dec 2018, Following this, the Company has now concluded that it believes the portfolio, held through its wholly owned subsidiary Compañia Minera Estrella de Plata SA de CV, remains prospective and Alien will continue to discharge its obligations to the Mexican DGM.

Initial priorities highlighted further in the RNS.

 

Croma Security Solutions (CSSG.L) 96p £13.2m

2019 HY Trading Update (Dec 18). “Another successful trading period generating revenues and profits ahead of internal expectations at the outset of the financial year, with trading through both divisions benefitting from high demand from both the public and private sectors.

Croma Vigilant, which employs over 1,200 security professionals, to guard assets and individuals, benefitted in the prior financial year from some large one-off contracts which were not expected to be repeated in the current year. However, in H1 this division has continued to win an increasing share of the security market both contracted and shorter projects as institutions opt for Croma Vigilant’s premium service resulting in trading being maintained at the record levels achieved in the prior year.

Croma Systems, provider of a range of innovative security technology services including CCTV, Intruder Alarms, FastVein (Biometrics) and high security locks, has also benefitted from good demand across its business activities.

The Company expects to report HY EBITDA of not less than £1.2m (2018: £1.2m).

 

Angling Direct (ANG.L) 73.5p £46.85m

FYJan19 trading update from the  largest specialist fishing tackle and equipment retailer in the UK.

The Company expects to report revenue for the financial period of £42m, increasing by 38.9% compared with the same period the previous year (2018: £30.24m). The Company continued to grow sales both in-store and online and reported that margins have increased slightly compared to last year. In-store sales were £19.74m, an increase of 50% overall and up 6.2% on a like for like basis. Angling Direct added three new stores during the period, taking the total to 24. Online sales grew to £22.26m, an increase of 30.3%, as a result of the Company’s continued investment in its ecommerce platform and development of international websites.

 

Tectonic Gold (TTAU.L) 0.45p £3.4m

The Intrusive Related Gold exploration pioneer, announced that it has executed an agreement with VAST Mineral Sands Pty Ltd  for a 50% economic interest  in diamond mining concessions on the South African Government’s operating Alexkor diamond mine in the Republic of South Africa. The Directors of the Company expect that the Joint Venture will result in immediate and sustainable cash flows to support the development of the Company’s gold exploration activities in Australia.

10 year concession to mine alluvial diamonds

 Tectonic Gold to acquire a 50% economic interest for $0.65m in equity    priced at 2.2p per share

Over 10 million carats recovered to date

 

Michelmersh Brick (MBH.L) 92p £79.27m

The specialist brick manufacturer, has acquired the entire issued share capital of Floren & Cie an established, profitable clay brick manufacturing business, for a maximum consideration of EUR 9.9 m. The Acquisition is expected to be immediately earnings enhancing for the Group.

Floren has been operating out of Sint Lenaarts (Brecht) nr. Antwerp, Belgium, since 1896. In 2018, Floren manufactured 19.5 m premium wirecut bricks, which were predominantly sold within the Belgian and UK markets, generating unaudited revenues of EUR 5.7 m and EBITDA of EUR 1.75 m.

Proposed £5m placing at 5p.

FYDec19E rev £44.99m and PBT £7.8m, yield 3.6%.

 

BATM (BVC.L) 45.95p £185.5m

Further to the Group’s announcement of 4 Feb 2019, BATM Advanced Communications, a provider of real-time technologies for networking solutions and medical laboratory systems, announced that it has been awarded an additional follow-on contract by the same Government defence department customer. This new order has a value of $3.3m and will be delivered during 2019.

This order is for the delivery of additional hardware and software cyber security products. The Group is also providing the customer with cyber security services under a separate contract. Following this latest order, the total contracted revenue awarded to the Group to date by this customer for products and services for this cyber solution is over $13.3m.

FY Dec19E rev $92.5m and PBT $2.48m.

 

Itaconix (ITX.L) 2.85p £9.02m

The “leading innovator in sustainable specialty polymers, announced the following trading update for the year to 31 Dec 2018.

Unaudited revenues for the year were £0.7m, with unaudited EBITDA in line with expectations. In addition, the Company successfully completed the previously announced restructuring of its UK operations, reducing its overall cost base for ongoing operations in the second half of 2018 to a rate of £2.1m p.a.

Net cash balances as of 31 Dec 2018 were £2.1m. The Company is also shortly expected to receive £0.3m of cash from R&D tax credits related to expenditure in 2017.

Since the year end, the Company has announced a supply agreement with Nouryon for Itaconix polymers to be used in non-phosphate detergents.”

 

Transense Technologies (TRT.L) 59.5p £6.45m

“The provider of sensor systems for the industrial, mining and transportation markets, announced that a customer has placed an order for 50 iTrack II units for installation in mines in North America.

Graham Storey, CEO of Transense, commented: “We are delighted with this new relationship. The Customer is a major supplier to the mining marketplace and their decision to adopt iTrack II after extensive testing is a very gratifying endorsement of the capabilities of Translogik and the iTrack II system. While there is no actual further commitment in place, we anticipate that sales to the Customer will reach very substantial levels by the end of our next financial year. We look forward to working closely with them both providing iTrack II to their customers and also developing further enhancements and improvements in the future.”

 

Head Chef:

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

*A corporate client of Hybridan LLP

Disclaimer

This document, which does not constitute research, has been issued by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to any such action. This document has no regard for the specific investment objectives, financial situation or needs of any specific person or entity and is not a personal recommendation to any such person or entity. Recipients should reach an individual investment decision, based upon their respective financial objectives and financial resources and, if any doubt, should seek advice from an investment advisor.

The information contained in this document is based on materials and sources that are believed to be reliable; however, such information has not been independently verified and therefore it is not possible to confirm such information as being accurate. This document is not intended to be a complete statement or summary of any securities, markets, reports or developments referred to herein. No representation or warranty, either express or implied, is made or accepted by Hybridan LLP, its members, officers, employees, agents or associated undertakings in relation to the accuracy, completeness or reliability of the information contained in this document, nor should it be relied upon as such.

The content of this document includes market commentary and other information which we have prepared in relation to the company referred to in this document, which is our broking client. The provision of this document to you constitutes a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of Regulation 600/2014/EU (MIFID II Regulation).

Any and all opinions expressed are current as of the date appearing on this face of this document only. Any and all opinions expressed are subject to change without notice and Hybridan LLP is under no obligation to update the information contained herein. To the fullest extent permitted by law, none of Hybridan LLP, its members, officers, employees, agents or associated undertakings shall have any liability whatsoever for any direct or indirect or consequential loss or damage (including lost profits) arising in any way from use of all or any part of the information in this document.

This document should not be relied upon as being an independent or impartial view of the subject matter and, for the avoidance of doubt, constitutes non-independent research (as such term is defined in the Financial Conduct Authority’s Conduct of Business Sourcebook to reflect the requirements of the MIFID II Regulation and Directive 2014/65/EU (known as MIFID II)). The individuals who prepared this document may be interested in shares in the company concerned and/or other companies within its sector, may be involved in providing other financial services to the company or companies referenced in this document or to other companies who might be said to be competitors of the company or companies referenced in this document. As a result both Hybridan LLP and the individual members, officers and/or employees who prepared this document may have responsibilities that conflict with the interests of the persons who receive this document. Hybridan LLP and/or connected persons may, from time to time, have positions in, make a market in and/or effect transactions in any investment or related investment mentioned herein and may provide financial services to the issuers of such investments.

In the United Kingdom, this document is directed at and is for distribution only to persons who (i) fall within article 19(5) (persons who have professional experience in matters relating to investments) or article 49(2) (a) to (d) (high net worth companies, unincorporated associations, etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (SI 2005/1529) (as amended) or (ii) persons who are each a professional client or eligible counterparty (as those terms are defined in the Financial Conduct Authority’s Conduct of Business Sourcebook) of Hybridan LLP (all such persons referred to in (i) and (ii) together being referred to as relevant persons). This document must not be acted on or relied up on by persons who are not relevant persons. For the purposes of clarity, this document is not intended for and should not be relied upon by any person who would be classified as a retail client under the Financial Conduct Authority’s Conduct of Business Sourcebook.

Neither this document, nor any copy of part thereof may be distributed in any other jurisdictions where its distribution may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Distribution of this report in any such other jurisdictions may constitute a violation of territorial and/or extra-territorial securities laws, whether in the United Kingdom, the United States or any other jurisdiction in any part of the world.

Where possible this document is made available to all relevant recipients at the same time. Dissemination of research by Hybridan LLP is monitored to ensure that it is only provided to relevant persons. Research prepared by Hybridan LLP is not intended to be received and/or used by any person who is a retail client.

Hybridan LLP and/or its associated undertakings may from time-to-time provide investment advice or other services to, or solicit such business from, any of the companies referred to in this document. Accordingly, information may be available to Hybridan LLP that is not reflected in this material and Hybridan LLP may have acted upon or used the information prior to or immediately following its publication. In addition, Hybridan LLP, the members, officers and/or employees thereof and/or any connected persons may have an interest in the securities, warrants, futures, options, derivatives or other financial instrument of any of the companies referred to in this document and may from time-to-time add or dispose of such interests.

This document may not be copied, redistributed, resent, forwarded, disclosed or duplicated in any form or by any means, whether in whole or in part other than with the prior written consent of Hybridan LLP.

MIFID II status of Hybridan LLP research
The cost of production of our corporate research is met by retainers from our corporate broking clients. In addition, from time to time we issue further communications as market commentary (such as our daily newsletter, Small Cap Breakfast), which we consider to constitute a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of the MIFID II Regulation.

Hybridan LLP is a limited liability partnership registered in England and Wales, registered number OC325178, and is authorised and regulated by the Financial Conduct Authority and is a member of the London Stock Exchange. Any reference to a partner in relation to Hybridan LLP is to a member of Hybridan LLP or an employee with equivalent standing and qualifications. A list of the members of Hybridan LLP is available for inspection at the registered office, 2 Jardine House, The Harrovian Business Village, Bessborough Road, Harrow, Middlesex HA1 3EX.

If you would like to unsubscribe, please email enquiries@hybridan.com with “unsubscribe me”.