Small Cap Feast

Small Cap Feast – 12 October 2020

Dish of the Day:

Fonix (FNX.L) has made its AIM debut, a mobile payments and messaging Company, enabling businesses to charge users’ mobile bills and send users SMSs via their Carrier. £45m secondary placing. Mkt cap £90m. FY June 2020 turnover £40.1m, PBT £7.3m.

HOME REIT  (HOME.L)  has floated on the Main Market (premium) and has confirmed a raise of £24o.6m at 100p. The Company will seek to contribute to the alleviation of homelessness in the UK, whilst targeting inflation-protected income and capital returns, by investing in a diversified portfolio of assets across the UK which will be dedicated to providing accommodation to the homeless.

 

Off the Menu:

No Leavers Today

 

What’s Cooking in the IPO Kitchen?

Meritwell II intends to list on the Specialist Funds Segment of the LSE raising up to £250m. The Placing will provide UK institutions with the opportunity to “swap” illiquid holdings which have become time and resource consuming holdings, at their bid price, in return for ordinary shares in the Company. Due 26 Oct.

YAMANA GOLD INC. (TSX:YRI; NYSE:AUY, LSE:AUY) to join the Main Market (standard). It is already listed on the TSX and NYSE. Yamana  offers “investors exposure to a pure-play senior gold producer with a high-quality asset portfolio in mining-friendly jurisdictions in the Americas “ Due 13 October. Mkt cap US$5.27bn.

Mailbox REIT PLC , a newly formed single asset company which owns the Mailbox , a large prime office-led mixed use property in Birmingham which has been independently valued at £179m, announced its intention to raise up to £62.5m  MailBox REIT  will apply for the Ordinary Shares be admitted to trading  on the IPSX Prime segment of International Property Securities Exchange (IPSX ).   IPSX is a new Regulated Investment Exchange regulated by the FCA and is the world’s first such exchange dedicated to the initial public offering and secondary market trading of companies owning single institutional grade real estate assets and multiple assets with commonality. Due 21 October.

Kaspi.kz, which operates the Kaspi.kz Super App, Kazakhstan’s most popular mobile app and the gateway to its market leading Payments, Marketplace and Fintech platforms  intends to conduct a secondary GDR offer on the LSE. Timing tbc

Tirupati Graphite, the fully-integrated, cash generative, specialist graphite and graphene producer with operations in Madagascar and India, announced its potential intention to undertake an initial public offering on the LSE (standard listing). Timing tbc

Buffettology Smaller Companies Investment Trust— Buffettology is seeking to raise a minimum of £100m via an initial placing, an offer for subscription and an intermediaries offer on the Main Market. will be the Investment Manager to the Company, led by Keith Ashworth-Lord (CIO of Sanford Deland Asset Management Limited). Sanford DeLand manages approximately £1.4bn across two open ended funds, the CFP SDL UK Buffettology Fund and the Free Spirit® Fund.  Due 29 October.

Wheaton precious Metals (TSE:WPM) – Proposed secondary listing on bringing one of the world’s largest precious metal streaming companies to the London Stock Exchange. Due Q4 2020.

Umuthi Healthcare Solutions Plc, the technology led healthcare business focused on the distribution of pharmaceuticals and the provision of medical facilities in remote areas, seeking admission to the Standard Listing segment of the Official List.  Timing tbc

Kibo Energy PLC, the multi-asset Africa focused energy Company, is seeking admission for its 100% owned UK subsidiary Sloane Developments Ltd , which will be renamed Mast Energy Developments PLC (MED), to the Standard List of the London Stock Exchange plc. Targeted for Q4 2020. The MED business strategy is to acquire and develop a portfolio of flexible small-scale power generation assets, exploiting a growth niche market in the UK for Reserve Power generation to balance out the national grid at critical times

 

Breakfast Buffet

ADM Energy* 5.45p £5.34m (ADME.L)

 Completion of the 14th Lifting at the Aje Field, part of OML 113 offshore Nigeria in which the Company currently holds a 5% crude entitlement.

As a result of the market volatility caused by the coronavirus pandemic, certain Aje Partners made the decision earlier this year to defer oil sales and store production on the FPSO, which has up to 750,000 barrels of storage capacity. Therefore, the Company and other partners chose not to participate in the 13th Lifting which occurred in March 2020 due to the prevailing oil price at the time. This has allowed ADM to benefit from the recovery in oil prices during the intervening period.

 The Lifting totalled 557,091 barrels with a net share of 33,056 barrels to ADM, which equates to ADM’s paying interest of approximately 6%. The proceeds of the Lifting will be applied against the project debt, significantly reducing the outstanding balance. The nominated offtake partner for the Lifting was Mercuria Energy Group Ltd, the global integrated energy and commodity trading company.

 

Science Group 248p £104m (SAG.L)

 Following its trading update on 10 September 2020, revenue across the Group has continued to be at the higher end of the Board’s expectations.  In particular, the performance of Frontier is noteworthy in terms of both revenue and, due to an enhanced product mix, an improved operating margin. While the Board is using the opportunity to increase investments in the operating businesses, it is now apparent that the Group’s adjusted operating profit for the year ended 31 December 2020 will exceed the Group’s expectations as set out at the start of the year. Science Group provides science and technology-based consultancy services to companies of all sizes in different industries globally.

 

Aquis Exchange 380p £103.2m (AQX.L)

The exchange services group, has appointed Deirdre Somers to its Board as an independent non-executive director. 

Deirdre has 23 years of stock exchange experience across both primary and secondary markets. She was Chief Executive Officer of the Irish Stock Exchange from 2007 to 2018, leading its transformation from a relatively small domestic equity exchange to a highly profitable plc with global specialisms, culminating in its sale in March 2018 to Euronext NV. Deirdre stepped down as CEO of Euronext Dublin in September 2018 and has held a position as an independent non-executive director & audit committee member for BlackRock iShares since April 2019.

 Deirdre has a deep knowledge of EU market structure and market regulation. She was President of the Federation of European Securities Exchanges (FESE) between 2015 and 2018 and she is also a fellow of the Institute of Chartered Accountants in Ireland.

 

Seeing Machines 4.75p £160m (SEE.L)

The advanced computer vision technology company that designs AI-powered operator monitoring systems to improve transport safety, has announced it is formally expanding its leading automotive driver monitoring system (DMS) into an overall vehicle interior/occupant monitoring system (OMS).  The expanded offering will be available for automotive production programs starting as early as 2023.

 Seeing Machines estimates that its entry into OMS opens an incremental market opportunity, worth up to a total of A$1.5 billion through to 2030, with an estimated incremental revenue opportunity for the Company exceeding A$350 million.

 

Argentex Group 106.5p £121m (AGFX.L)

 The provider of bespoke foreign exchange services to institutions, corporates and high net worth individuals, today issues a trading update for the first half of the financial year ending 30 September 2020.   Argentex LLP, the Group’s FCA regulated trading subsidiary, expects to report revenues for the six-month period to 30 September 2020 of £11.8 million. The 14.7% decrease in revenue vs the six months ending 30 September 2019 (£13.8 million) was primarily driven by a reduction in client activity, as the continued macro-economic uncertainty and the effects of the COVID-19 pandemic led to some clients deferring their trading activity.  

This deferral of trading activity is expected to result in stronger trading volumes in the second half of the financial year. The underlying business performed well during the period as the Group added a significant number of new customers as it continued to focus on increasing the quality and diversification of its client book, while also turning down trades that exceeded the Group’s risk appetite in order to maintain the integrity of its exposure profile.

The strong momentum in customer growth during the first half of the financial year along with the expected uptick in trading from the existing client base gives the Directors confidence that the results for the second half, traditionally the slightly stronger half, will deliver a material improvement on the first half results.

 

Scotgold Resources 117.5p £60.34m (SGZ.L)

The gold exploration and production company focused on Scotland, has raised £3 million before expenses by way of a placing  at a price of 110p per New Ordinary Share. The proceeds of the Placing will be used to accelerate plans to double production at the Cononish Gold & Silver Mine, which is on course to become Scotland’s first commercial gold mine by 30 November 2020. Funds will also be used to increase exploration activities, rolling out Scotgold’s systematic programmes across its 2,900km2 licence portfolio in the Grampian Terrane of Scotland.

 

E-therapeutics 15.375p £64.4m (ETX.L)

Appointment of Ali Mortazavi as Chief Executive Officer. He will also retain his position as Chairman of the Company. The Board currently consists of one Executive Director and two Non-Executive Directors.

Also HY Jul 20 results out today. ·     A further £11.6m gross fundraise was successfully completed in July 2020 to enable the Company’s next stage of growth and value creation. · A collaboration agreement has been entered into with Galapagos NV (“Galapagos”) to identify new therapeutic approaches to modulate a specific mechanism involved in idiopathic pulmonary fibrosis (“IPF”)

Post period · Commenced IP landscaping of RNAi platform. Anticipate in vivo testing of proprietary GAlNAc siRNA platform early 2021. Remains in active discussions with large pharmaceutical and biotechnology companies .

 

Maestrano Group 11.5p £17.6m (MNO.L)

The Artificial Intelligence platform for transport corridor analytics, announces the appointment of Mr Nicholas Smith as CEO, with effect from 11 January 2021.

 Mr Smith was previously appointed as a Director of the Company and Vice President Global Sales on 6 November, 2019. Following an extended handover period, Mr Andrew Pearson will step down as CEO and a director upon Mr Smith taking up his new appointment.

Ian Buddery, Chairman of the Board, said:

” Andrew has done a superb job as CEO, with flawless execution of a complex merger and establishing processes and practices that will serve the Company for years to come.  The Board recently completed a long term business plan and agreed that our product leadership warranted increasing focus on complex Machine Learning solutions in the transport sector, hence this decision.  Nick is planning to relocate to the UK in January to focus on growing our Northern hemisphere customer and partner base.”

 

Induction Healthcare 82.5p £35m (INHC.L)

Strategic Collaboration Between Cerner and Induction Healthcare

 – Value added reseller agreement:NHS Trusts who are Cerner clients can access Zesty products through their existing agreements

– Improving patient experience: strategic collaboration to help NHS hospitals make it easier for patients to manage their outpatient appointments and correspondence online

Induction is a healthcare technology company that helps healthcare professionals deliver better care more efficiently.

 

Image Scan 2.6p £3.6m (IGE.L)

Image Scan, (AIM: IGE) specialists in the field of X-ray imaging for the security and industrial inspection markets, announces the market launch of the AXIS-CXi, an innovative cabinet X-ray system for use in mailrooms and a wide range of other security screening environments.

The AXIS-CXi uses the dual energy X-ray technology deployed in airport security and in Image Scan’s own portable X-ray systems to separate different classes of material, the first time this technology has been offered in a cabinet X-ray format. In addition, the system will offer a large chamber and improved X-ray performance, making it suitable for use beyond mailrooms, the environment where most cabinet X-ray systems have traditionally been deployed. Potential additional opportunities include government and commercial buildings, prisons, and customs.

AXIS-CXi will be shown to potential customers for the first time at the Total Security Summit, a security technology event to be held online on Monday 12th October. This is an example of how the Company has successfully adapted its marketing strategy to reflect the travel restrictions imposed during the COVID-19 pandemic.

 

Head Chef:

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

*A corporate client of Hybridan LLP

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