Small Cap Feast

Small Cap Feast – 18/10/21

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What’s Cooking in the IPO Kitchen?

Gymshark has started to put together plans for a stock market listing according to City A.M. The company hit a £1bn valuation just over a year ago and boasts customers in more than 130 countries. Gymshark was founded by teenager Ben Francis in 2012 in his parents’ garage with products that appeal to Gen Z consumers. Timing TBA
Rubix Group Holdings, the market leading pan-European distributor of industrial maintenance, repair and overhaul products and services is considering an initial public offering Main Market (Premium). In the six months ended 30 June 2021, Rubix generated Revenue from Ongoing Operations of EUR1,312m and Adjusted EBITDA of EUR123m (9.4% Adjusted EBITDA Margin from Ongoing Operations), an increase of 10.6% and 19.3% compared to the six months ended 30 June 2020, respectively. Raising proceeds equivalent to approximately EUR850m, and additionally may also include the sale of existing ordinary shares by current shareholders. Timing TBA
Firering Strategic Minerals to join AIM, a holding company for a group of exploration and development companies set up to focus on developing assets towards the ethical production of critical metals. The Company’s portfolio of assets is located in Côte d’Ivoire and contains projects that the Directors believe to be prospective for lithium and columbite-tantalite. Due Early Nov. Offer TBA
Harmony Energy Income Trust to join the Specialist Fund Segment of the Main Market raising up to £230m. The Company’s investment objective is to provide investors with an attractive and sustainable level of income returns, with the potential for capital growth, by investing in commercial scale energy storage and renewable energy generation projects, with an initial focus on a diversified portfolio of battery energy storage systems located in Great Britain. The Company has contracted with Tesla Motors Limited in respect of its initial portfolio of battery storage projects, to be acquired on IPO, which will benefit from Tesla’s 2-hour duration Megapack systems and Autobidder AI revenue optimisation platform. Due Early Nov.
Stelrad Radiator Group, the specialist manufacturer and distributor of steel panel radiators in the UK, Europe and Turkey, is considering an IPO on the Main Market (Premium). Potential secondary and primary (c.£25m) offer. Timing TBA.
Pantheon Infrastructure to join the Main Market (Premium). PINT will target attractive risk-adjusted total returns comprising capital growth and a progressive dividend through making equity and equity-related investments in private infrastructure assets alongside other leading private asset investment managers. Due Mid Nov.
Quantum Exponential to join AQSE. The Company intends to identify investment opportunities in the quantum technology sector primarily in the NATO allied countries. The Company has identified over 175 start-ups which potentially meet their investment strategy with a focus on seed funding for start-ups with second stage funding plans in preparation. Offer and timing TBA.
Pod Point, one of the United Kingdom’s leading providers of Electric Vehicle charging solutions is considering a Main Market (Premium) listing. As at 30 June 2021, Pod Point had installed more than 89,000 home charge points and over 13,000 commercial units, including those located at workplaces and destination locations (such as shops and leisure attractions). Timing and offer TBA.
Tungsten West to Join AIM. Tungsten West is the 100% owner and operator of the historical Hemerdon tungsten and tin mine located near Plymouth in southern Devon. Hemerdon represents the world’s third largest tungsten mineral resource, with a JORC (2012) compliant Mineral Resource Estimate of approximately 325Mt at 0.12 WO3. Capital raised on Admission: £39m. Anticipated Mkt Cap: £106.2m. Expected 21 Oct.
Softline the global solutions and services provider in digital transformation and cybersecurity, with its headquarters in London, is considering proceeding with a potential initial public offering of global depositary receipts representing its ordinary shares. The Company is considering applying for admission of the GDRs to the standard listing segment of the Official List of the FCA and to trading on the Main Market for listed securities and on Moscow Exchange. The Group had a turnover of US$1.8 bln for the year ended 31 March 2021, employs c.6,000 people globally, and operates in more than 50 countries across emerging markets. Primary proceeds from the Offer are expected to be around US$400m. Due Late Oct.
Marks Electrical, a fast growing online electrical retailer, announced its intention to proceed with an initial public offering and to seek admission to trading on AIM. Marks Electrical sells, delivers, installs and recycles a wide range of household electrical products. In the year to 31 March 2021 revenue grew to £56m, up 78% against the previous financial year, while EBITDA increased to £7.45m, at a 13.3% EBITDA margin. The Group has made a strong start to its current financial year to 31 March 2022, with revenue growth of 78% in H1 FY2022, versus 47% growth in H1 FY2021. Offer TBA Admission is expected to take place in late October 2021.
Future Metals NL (ASX:FME) (formerly named Red Emperor Resources NL) to join AIM. No funds being raised. Future Metals is a platinum group metals exploration and development company that holds a 100% interest in the Panton PGM Project in Western Australia. The Panton Project comprises 3 granted mining leases (M80/103, M80/104 and M80/105), which cover an area of approximately 23km2 and are located 60km north of Halls Creek and 1km from the Great Northern Highway, in the East Kimberly region of Western Australia. The Panton Project has a JORC (2012) Mineral Resource Estimate of 14.3Mt at 2.19g/t platinum, 2.39g/t palladium, 0.31g/t gold, 0.27 per cent. nickel and 0.08 per cent. copper. Due mid October. Mkt cap c£35.8m.
Bens Creek Group to join AIM. Bens Creek, together with its subsidiaries, will, on Admission, own and operate a metallurgical coal mine located on 10,000 acres in the southern part of the state of West Virginia and eastern edge of the Commonwealth of Kentucky, in the central Appalachian Basin of the eastern United States of America. The mine’s operations are located primarily in Mingo County, West Virginia. The mine includes a wash plant and rail loading facility located on the freehold land. Capital to be raised on Admission: £7m. Anticipated Mkt Cap on admission: £35m. Due 19 Oct.
M7 Regional E-Warehouse REIT intends to apply for admission onto The Property Stock Exchange (Wholesale Segment). On Admission, the company plans to acquire a portfolio of UK retail warehouses worth £120m from M7 Real Estate Investment Partners VIII. The portfolio currently comprises 18 retail warehouse properties across the UK totalling 978,317 sq ft and fully let to 53 occupiers. Rent collections for Q2 2021 stand at 93% and are expected to revert to 100% in the coming quarters.
Castlenau Group to join the Specialist Fund Segment of the LSE’s Main Market. Castelnau was incorporated with limited liability in Guernsey under the Companies Law on 13 March 2020 as a closed-ended company limited by shares. The Company’s investment objective is to compound shareholders’ capital at a higher rate of return than the FTSE All Share Total Return Index over the long term. The Company is targeting an issue in excess of £170m. Sir Peter Wood, British entrepreneur and innovator, has committed to make a cornerstone investment of £25m in the Initial Placing. Due 18 Oct.
Responsible Housing REIT to join the Main Market (Premium) raising up to £250m. The Company’s investment objective is to generate a consistent and sustainable income-based return from the provision of Supported Housing accommodation assets and aligned sectors. The Company will acquire and create quality, fit-for-purpose accommodation assets to cater for supported residents across a number of care sectors including adults and young people with learning disabilities, mental health issues, physical disabilities, addiction, those with support needs, those in need of temporary accommodation, the elderly and otherwise vulnerable individuals.
Central Copper Resources, a company focused on delivering a high grade copper project into production and exploration of assets in the Democratic Republic of the Congo (DRC) and in the Republic of Zambia to join AIM. By 2022, CCR intends to be ready to commence the project financing of its Mbamba Kilenda copper project. It pushed back its AIM float on 30th September from end September to late October. The amount to be raised is still yet to be confirmed.

Breakfast Buffet

Access Intelligence 142.5p £175.4m (ACC.L)

The technology innovator delivering Software-as-a-Service (SaaS) solutions for the global marketing and communications industries announced that the Australian Copyright Tribunal (Copyright Tribunal) has delivered its decision in the proceedings detailed in the Company’s Admission Document dated 15 June 2021 and brought by Isentia, the Company’s recently acquired subsidiary. In its decision, the Copyright Tribunal accepted the terms of the copyright licence proposed by Isentia. Whilst details of the Copyright Tribunal findings remain confidential, the decision provides that the licence fees payable by Isentia to Copyright Agency Limited on an ongoing basis will remain stable for the next four years. Isentia regards the licence terms and fees accepted by the Copyright Tribunal as fair and reasonable, striking the right balance between rewarding publishers for the usage of their content and not overcharging clients for usage of that content.

Benchmark Holdings 63.5p £426m (BMK.L)

The aquaculture biotechnology business updated ahead of its full year results for the year ended 30 September 2021, which will be announced on 29th November 2021. Following positive financial results in Q3 2021, the Company maintained this momentum in Q4 2021 and has delivered a stronger than expected trading performance across its three business areas driven by the Group’s continued strong commercial focus, disciplined cost control and further recovery in the Company’s end markets. The Group’s Advanced Nutrition business area has continued to deliver excellent year on year growth while the Group’s Genetics business area delivered a strong end to the year, and in the Group’s Health business area, the Company achieved its first revenues from its sea lice treatment, Ectosan ® Vet and CleanTreat ®; all business areas delivered above the Board’s expectations in September. As a result, whilst still subject to audit, the Group’s Adjusted EBITDA for FY21 is expected to be significantly ahead of the current market consensus which is £15.9m.

Bradda Head 7.63p £22.3m (BHL.L)

The North America-focused lithium development group has started the process to list on the US OTC Markets platform. The Company’s ordinary shares will be cross-traded on the OTCQB Board of the OTC Markets. This listing will be in addition to the existing quoting on the AIM of the Stock Exchange in London. Bradda’s 100%-owned lithium assets are located in Arizona and Nevada, and the company is developing these assets with the end-goal to produce low-carbon footprint, low operating cost, battery-grade lithium end-products. Currently the US produces c.5kt per year of LCE (Lithium Carbonate Equivalent), and forecasts estimate that c.250kt LCE will be needed by 2025 in the US for domestic supply. The objective of applying to the OTCQB in New York is to provide efficient access to U.S. investors, enhance liquidity and facilitate a fair valuation for the Company going forward. The Company is of the view that through trading on the OTCQB, Bradda Head can engage with a significant network of U.S. investors, data distributors and media partners, ensuring that U.S. investors have access to the same level of information and disclosure that is available to investors in the United Kingdom, but through U.S.-facing platforms and portals used to conduct research.

CloudCoCO 1.6p £11.3m (CLCO.L)

The UK provider of Managed IT services and communications solutions to private and public sector organisations updated on its progress for the year ended 30 September 2021. The Group has continued to perform well, completing its ‘get well’ and ‘get fit’ development phases and progressing through to ‘get bigger’, despite ongoing Covid-related challenges in the period. “Whilst we saw a temporarily reduced number of orders in early FY21, as a result of customers deferring large scale IT projects and challenges in accessing sites in person, we were successfully able to navigate the impacts of the pandemic. As a result (subject to finalisation and audit) the Directors expect revenue performance in FY21 to marginally exceed the £8m recorded in the year to 30 September 2020 and also expect the FY21 Trading EBITDA to be in excess of £700k, up significantly on the £261k reported in FY20 and in line with market expectations.”

Live Company Group 3.4p £5m (LVCG.L)

Live Company Group plc presents further information with regards to the Formula-E race in Cape Town. Following the announcement on 13 July confirming the ratification of the Formula-E calendar and inclusion of Cape Town, Formula-E and e-Movement (Pty) Ltd, have agreed that due to the ongoing impacts of the Covid-19 pandemic that continue to be felt in South Africa and internationally, the inaugural Cape Town E-Prix is set to be staged in Season 9 (ie in 2023), rather than Season 8 as originally intended and announced, delaying by one year the commencement of the five-year (with additional five year option) commitment to host E-Prix in Cape Town. There will still be a number of key events in 2022 building up to the inaugural race including the track reveal and an e-Investment seminar to map out a 10 year programme of strategies to drive the e-mobility economic sector and positive effects on climate change and LCSE is leading the preparations to host the maiden race in Cape Town. The Company will provide a further update on Formula E and the LCSE division in its next operational update.

Mind Gym 192.5p £193m (MIND.L)

The global provider of human capital and business improvement solutions provided a trading update for the six months ended 30 September 2021. The Group expects to report revenues of £24.1m, +76% ahead (in constant currency terms) of the comparative period last year and +7% above the comparative pre-COVID period two years ago. In actual currency terms revenues were +66% on the prior year and level on two years ago due to a headwind from sterling strengthening against the US dollar. This performance is in line with the Board’s expectations. In terms of the Group’s ongoing digital transformation, 82% of revenues in the period were digitally enabled. The Group continues to invest in its digital capabilities ahead of planned launches of the Company’s new digital product set. The Group remains confident in its strategy to invest for future growth and its balance sheet remains resilient. Cash at bank, as at 30 September 2021, was £11.9m. The Group has recently entered into a £10m debt facility (£6m RCF, £4m accordion), which was undrawn as at 30 September 2021, to provide additional flexibility if required.

Mobile Streams 0.58p £14.3m (MOS.L)

The mobile content and data intelligence company announced that in partnership with Quanta Media Group it will be launching its LiveScores service in Brazil. The service will go live in early November. Income is anticipated to be generated for MOS through affiliate revenue share with Quanta. Affiliate revenue occurs when a lead generated from the LiveScores service is sold to another organisation who will then market their service or product to the lead. All affiliate revenue share generated will then be paid into the MOS UK account and therefore will not incur any currency related risks. As with the Company’s successful launches in Mexico and Argentina, this service will utilise Quanta content and the Streams delivery platform. This next territory launch represents another step in the Company’s development, and we are currently in advanced discussions regarding further launches. The Company will provide updates regarding take up of its services at the appropriate times.

Semper Fortis Esports* 1.90p £7.9m (AQSE:SEMP)

The esports company focused on establishing esports teams, forming brand and technology partnerships, and providing business to business advisory services, announced its entry into the blockchain based, Non-fungible Token (NFT) online video game title Axie Infinity and free-to-play online digital collectible card game Hearthstone. The company’s esports team, SMPR has made an official signing of Aleksei Bakumenko (‘Iner’) to compete in both Axie Infinity and Hearthstone for the upcoming season. The player has signed a three-month contract with an option to renew for an additional six months thereafter. They will receive an annual salary and performance-based incentives. The new hire is the first competitive esports players competing in the play-to-earn division of Semper Fortis Esports, where players will be incentivised to compete on behalf of the company for cryptocurrency-based returns in the form of NFTs.

SDX Energy 1.91p £7.94m (SDX.L)

The MENA-focused energy company announced the spudding of the MSD-21 infill development well on the Meseda field. This well is the first, in a fully funded, 12 well development campaign on the Meseda and Rabul oil fields in the West Gharib concession, Egyptian Eastern Desert. The development drilling campaign is aimed at growing production from current rates of c. 2,400bbl/d to c. 3,500 – 4,000bbl/d by early 2023. The MSD-21 infill development well on the Meseda Field (SDX:50% working interest) spudded on 16 October and is targeting the Asl Formation reservoir at approximately 3,200ftTVDSS. It is estimated that the well will take around four weeks to drill, complete and tie-in to the existing infrastructure. MSD-21, with an expected gross cost to drill and tie in of US$0.9-US$1m, is anticipated to come on-line and produce at around gross 300bbl/d, which would have an immediate effect on Group cashflow and result in a payback period of less than one year at current oil prices. The Company expects to update the market on its result in mid-November.

Wandisco 340.5p £203m (WAND.L)

The LiveData company , announces the General Availability of the LiveData Platform for Azure. This is a significant achievement for the Group and a critical step in converting WANdisco’s new business pipeline. General Availability provides customers with greater assurance when embarking on Petabyte scale data migration projects, providing the confidence that this business-critical operation can be completed without disruption or downtime. General Availability marks the completion of a multi-year joint project with Microsoft to integrate WANdisco’s technology into the cloud fabric, the most important initiative in WANdisco’s journey to date. General Availability is accompanied by a continued joint go-to-market strategy for WANdisco and Microsoft Azure.

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