Small Cap Wrap: 01st February 2017

01st February 2017

 Revolymer Development Agreement

TP Group Trading Update

Fitbug Customer Win

On this day:

1793—France declares war on the United Kingdom and the Netherlands

2003—Space Shuttle Columbia disintegrated during the re-entry of mission STS-107 into the Earth’s atmosphere, killing all seven astronauts aboard.

2013—The Shard, the tallest building in the European Union, is opened to the public.

Cambridge Cognition (LON:COG 84.00p/£16.76m)*

The neuroscience digital health Company announced it has received 510(k) clearance from the U.S. FDA to market its CANTAB Mobile product as a medical device in the U.S.. CANTAB Mobile is designed to detect clinically-relevant memory impairment in older adults at the point of care. It includes a computerised test of visuospatial associative learning (CANTAB PAL) to assess episodic memory with optional mood and functional assessments, which can help to detect symptoms of depression and problems with performing regular activities of daily living. The touchscreen test, which takes under 10 minutes to complete, can be self-administered using voiceover instructions in over 20 languages with automatic scoring, accounting for age, gender and education level. All results can be accessed in a simple to interpret, one-page physician’s report using a traffic-light output for memory and mood outputs. Since being classified as a European Medical Device in 2013, CANTAB Mobile has been used routinely to assess over 26,000 patients in the UK who had concerns about their memory or were considered by their physician to be at increased risk of dementia.

 

Craneware (LON:CRW 1,280.00p/£351.60m)

Craneware, the provider in Value Cycle solutions for the US healthcare market, provided an update on trading for the six months ended 31 December 2016. The Group announced continued growth and expects to report 15 percent increases in both revenue and adjusted EBITDA for the six month period ended 31 December 2016, building on the return to double digit growth reported in the year to 30 June 2016 and slightly ahead of expectations. Underlying sales continue to support this growth, with a particularly strong Q2, post the US Election result, and a healthy sales pipeline. The Group continues to invest for the future. In the period it has invested c$3m in its newly formed Employee Benefit trust and over $1m in future product development, including its cloud-based Trisus product suite and the new Craneware Healthcare Intelligence product suite. The Group’s cash balance at the end of the period was maintained at $45m (H116: $45m) after making these investments whilst continuing a progressive dividend payment policy. With the growth in the period, continued cash generation and a healthy sales pipeline, the Board is confident in meeting market expectations for the full year.

Fitbug (LON:FITB 0.186p/£2.24m)*

Fitbug, the digital wellness technology provider for corporate organisations,  announced a customer win with a global financial services group in Asia. The customer will use Fitbug’s digital wellness services to help maximise employee performance, with the end goals of improving employee engagement, and reducing absenteeism and risk of chronic illness. Fitbug has secured an initial 1-year corporate wellness programme, which includes ongoing service revenue, together with an order for 14,000 devices. The devices were shipped in December and the programme is rolling out early this year. The Company also announced that for year ended 31 December 2016, revenue for the year is expected to be slightly behind that for the corresponding period last year, however the mix of revenue is expected to have changed to over 90 percent of 2016 revenue from corporate customers. Losses before tax for the full year are expected to be in line with the Board’s expectations. Overall the Group’s turnaround strategy is expected to have reduced losses for the full year by almost 50 percent in comparison with 2015’s audited loss before taxation of £6.53m, with substantial cost savings made in the second half which will continue to benefit Fitbug through 2017 and beyond. The Company’s balance sheet is also expected to show an improvement over the FY15 balance sheet as a result of its £2.61m fundraise and the conversion of £8.4m of the Group’s core debt into equity, which was completed in July 2016. Moreover, the Company successfully completed a cash placing to raise £1m with the intentions to use the funds raised from the Placing for general corporate purposes. Moreover, the Company also announced a strategic partnership with Olympic gold medallist Sally Gunnell, OBE, to help promote and expand its digital wellness offering to businesses in the UK. The partnership combines Sally’s programme and Fitbug’s scalable digital platform to offer a rich corporate health and wellness proposition and to generate new growth opportunities.

 

IG Design (LON:IGR 244.50p/£153.91m)

IG Design Group, a designer, innovator and manufacturer of gift packaging, greetings, stationery, creative play products and giftware, announced an update for the third quarter, which covers the Group’s key Christmas trading period to 31 December 2016. The Group reported that following the strong performance reported over the first six months ending 30 September 2016, trading has continued to be strong during the Christmas period. Results remain in line with the upgraded expectations announced in November 2016, with all regions trading profitably. The Board remains confident in the full year outlook of the Group.

 

InnovaDerma (LON:IDP 130.5p/£22.10m)*

InnovaDerma, a UK developer of ‘at-home’ and clinically proven treatments for hair loss, hair care, self-tanning and skin rejuvenation, provided its trading update for the six months ended 31 December 2016. The Board announced that the Group’s first half year financial performance has been encouraging and revenues are expected to show growth of just over 80 percent year-on-year on a constant currency basis to approximately £3m. The increase in revenue has been driven by the Company’s expansion strategy in the UK with the strong performance of Skinny Tan, which was launched in February 2016 through Superdrug. The Group has undertaken significant corporate activity in the first half including listing on the Main Market of the London Stock Exchange, opening up the US market, and the transition of its manufacturing to the UK. One off costs associated with these activities will be absorbed into the first half of the financial year. The Company also announced the appointment of Kieran Callan as a Non-Executive Director with immediate effect, succeeding Garry Lemair who stepped down from the Board on 10 January 2017. Mr Callan has more than 30 years of experience in the FMCG and retail sector with a strong track record of devising and implementing strategies for growth companies.  Moreover, the Company also announced that it has raised £0.8m before expenses through a placing by Hybridan LLP of 727,273 new ordinary shares at a placing price of 110 pence per share. The Company has continued to receive strong demand for its products and therefore the key funding priority is to build stock levels at a faster pace to fulfil any increase in demand from various markets in the second half of our financial year in 2017.

 

MediaZest (LON:MDZ 0.102p/£1.35m)*

The Board reported the unaudited results for the six months ended 30 September 2016 for MediaZest plc. The financial review showed revenue for the period was down 8 percent to £1.47m, gross profits were up 2 percent to £0.63m leading to an EBITDA profit of £4,000 (2015:£8,000). Highlights of the six month period included delivery of several new projects with existing clients such as Hyundai, HMV, Kuoni, Rockar, Diesel, Farrow & Ball and Ted Baker (combined revenue in the period £0.6m), but also new business wins with Halfords, Virgin Media and LG (combined revenue in the period £0.17m). Further afield, in May 2016 the Company successfully installed a high resolution video wall for Ugg, part of the Deckers group, in their new flagship store in Florida. Improvements in recurring revenue streams continue, and coupled with tight cost control and new business wins for the second half of the current financial year, the Board is looking to deliver improved results for the full year ended 31 March 2017. However, this is subject to the acquisition, timing and delivery of certain upcoming key projects.

 

Mercia Technologies (LON:MERC 48.5p/£107.06m)

Mercia Technologies, a national investment group focused on the creation, funding and scaling of innovative technology businesses with high growth potential from the UK regions, announced a conditional placing at 46p per Placing Share. The Placing Price represents a discount of approximately 8.9 percent to the closing mid-market price of 50.5p per Ordinary Share on 30 January 2017. Once completed, the gross proceeds from the Placing will be approximately £40.0m. The primary purpose of the Placing is to accelerate the development of the Group’s existing portfolio companies and to capture the opportunity to invest in new direct investment opportunities across its target sectors nationally and specifically within the UK regions. The number of opportunities has been significantly enhanced through the acquisition of Enterprise Ventures Group Limited in March 2016 which took the number of investee technology companies in the Group’s third party managed funds from circa 35 to circa 150.

 

Petards (LON:PEG 25.10p/£8.98m)*

Petards, the software developer of advanced security and surveillance systems, announced that it has secured a 3 year contract renewal from the Air Platform Systems Platform Protection team, part of the UK Ministry of Defence, worth in excess of £1.6m for the support of ALE 47 and M147 Threat Adaptive Countermeasures Dispensing Systems which are fitted to Lynx, Puma, Chinook, Merlin, and C130J aircraft platforms. The contract is effective from 1 January 2017 and runs until 31 December 2019 with an option, which if exercised, would extend the contract for a further two years until 31 December 2021. The Company also announced that it has been awarded a contract to supply Siemens Mobility Division with Petards eyeTrain systems. The order is worth approximately £2m. Engineering activities will commence immediately with the first equipment deliveries to be made at the end of the first quarter 2017 and it is anticipated that the project will be completed during 2018.

ProMetic Life Sciences (TSX:PLC CAD2.11/CAD1,315.01m)*

ProMetic Life Sciences, announced that its orally active lead drug candidate, PBI-4050, has been issued a Promising Innovative Medicine (PIM) designation by the UK Medicines and Healthcare Products Regulatory Agency for the treatment of Alström Syndrome (AS). A PIM designation is an early indication that a medicinal product is a promising candidate for the Early Access to Medicines Scheme, intended for the treatment, diagnosis or prevention of a life-threatening or seriously debilitating condition with the potential to address an unmet medical need following an early review of the clinical data by the agency. The Company also announced that its orally active lead drug candidate, PBI-4050, has been granted an orphan drug designation status for the treatment of AS by the European Commission. The European Medicines Agency determined that the intention to treat AS with PBI-4050 was justified based on the preliminary clinical data generated in AS patients showing an improvement in liver fibrosis.  ProMetic is currently investigating the effects of PBI-4050 on multiple organs in AS patients in an ongoing open label Phase 2 clinical study in the UK.

 

Revolymer (LON:REVO 33.50p/£26.33m)

Revolymer announced that its wholly owned US subsidiary, Itaconix Corporation, has signed a joint development agreement with Akzo Nobel Chemicals International B.V. to advance commercial collaborations in certain applications for the Itaconix itaconic acid polymer technology platform. The agreement establishes a broad operating framework for the parties to jointly identify, develop and commercialise new polymers using Itaconix’s patented technology. This innovative technology enables the production of polymers from renewable ingredients, which fits closely with their Planet Possible sustainability agenda of doing more with less, these bio-based polymers offer unique properties in applications essential to our everyday lives, ranging from water quality to cleaning and hygiene.

 TMT Investments (LON:TMT $1.65/£46.5m)*

TMT Investments, the venture capital Company investing in high-growth, internet-based companies across a variety of core specialist sectors, announced that its portfolio company Pipedrive, Inc. has completed a US$17m Series B equity financing round, led by Atomico, with participation from Bessemer Venture Partners and Rembrandt Venture Partners. The transaction represents a revaluation uplift of approximately US$4.08m (or 132 percent) in the fair value of TMT’s investment in Pipedrive, compared to the previous announced amount as of 30 June 2016, and is equivalent to approximately 14.7 cents in additional net asset value per TMT share.

TP Group (LON:TPG 6.38p/£25.88m)

TP Group, the specialist services and engineering group, announced the following trading update. The Board reported that, following the trading update issued on 14 December 2016, the Group will report results for the financial year ended 31 December 2016 in line with current market expectations. The Group closed the year with a cash balance ahead of expectations at £9.2m. This is an improvement of £2.2m over the cash balance at the end of 2015.  The Board is confident that the Group can continue its progress in 2017 as it pursues a strong pipeline of future business opportunities alongside a growing order book position.

*A corporate client of Hybridan LLP