Small Cap Feast

Small Cap Feast – 20th October 2016

Dish of the Day:

No AIM Primary Today

Off the Menu:

No AIM Leavers Today

What’s Cooking in the IPO Kitchen?

Misys— Press reports that the IPO valuation is to be cut by £1bn against an expected £5bn

TI Van Elle—The geotechnical contractor to the UK construction market is hoping to come to AIM later this month

Ascot Lloyd— The UK IFA is also hoping to join AIM later this month. Ascot Lloyd’s strategy is to grow through a combination of organic growth and further targeted acquisitions.


Breakfast Buffet

Challenger Acquisitions* (CHAL.L) 16.88p £3.66m

The main market listed leader in the Giant Observation Wheel industry has updated on construction of the New York Wheel Project. $300m has been spent on the project so far. The majority of the parking garage is now operational and the terminal building is expected to be structurally complete in December. The legs for the wheel have arrived in the South Brooklyn Marine Terminal. Each of the four legs weighs 550 tonnes, measuring 18 feet wide and 275 feet tall. The grand opening is April 2018 with an estimated 3.5 million annual visitors expected.


Milestone Group* (MSG.L) 1.32p £10.39m

The provider of digital media and technology solutions has raised £1.385m at 1.5p, a 13.6% premium to yesterday’s closing mid price. The proceeds of the Placing will be used for marketing of the newly launched Alchemy e-media platform, recruiting key staff, and additional development of the Passion Project platform.


Water Intelligence (WATR.L) 81.5p £8.65m

The provider of non-invasive leak detection and remediation solutions, is pleased to announce a partnership as an industrial affiliate  of the Institute for Molecular Engineering at the University of Chicago (IME).  Water Intelligence and IME plan to collaborate on the commercialisation of technology for potable and non-potable water applications.  FYDec16E revenues of £7.48m and EPS of 6.26p. PE13x.


Action Hotels (AHCG.L) 52p £76.77m

The owner, developer and asset manager of branded three and four-star hotels in the Middle East and Australia, is pleased to announce that ibis Styles Brisbane Elizabeth Street has won a “Best Economy Hotel” award at the 2016 Hotel Management Awards. HM Magazine described Ibis Styles Brisbane as a “prime example of how new-build hotels can thrive and tap into the modern day economy traveller”.  FYDec16E revenues of £52.3m and PBT of £0.98m.


IXICO (IXI.L) 23.5p £6.2m

The brain health company, has signed a new contract worth US$1.2m with a top 15 global pharmaceutical company for advanced imaging clinical trial services in a rare neurodegenerative disease, progressive supranuclear palsy (“PSP”).   The project is for a Phase IIa clinical study of patients in the early stages of PSP to develop a first-in-class therapy that could prevent further degeneration and will utilise IXICO’s TrialTracker™ and Assessa® digital platforms to collect and analyse MRI data from specialist imaging centres across Europe & North America.


Aggregated Micro (AMPH.L) 68p £21.2m

The specialist in the sale of wood fuels and the development of distributed energy projects, announces that it has secured further funding for the financing of its biomass boiler portfolio and future grid balancing projects from Aggregated Micro Power Infrastructure 2 plc (“AMPIL2”), a newly launched vehicle which has raised an initial £10.17 million in the form of 8% loan notes, listed on the Cayman Islands Stock Exchange. There are no forecasts in the market.


REDX Pharma (REDX.L) 47.75p £44.74m

The drug development company, has identified a drug development candidate for its reversible Bruton’s tyrosine kinase (“BTK”) inhibitor program. The compound, named RXC005, has the potential to treat the majority of patients suffering from chronic lymphocytic leukaemia (“CLL”), including those who become resistant to the increasingly used treatment ibrutinib. The Company will now progress studies to prepare the RXC005 program for first-in-human clinical trials. These trials are currently expected to commence early 2018.


Lombard Risk Management (LRM.L) 7.25p £29m

HYSep16 results from provider of integrated collateral management and regulatory reporting solutions for the financial services industry. Record first-half revenue of £15.2m up 41.2%. Order book of contracted revenue at £9.2m (2015: £6.8m). EBITDA of £1.5m (2015: £0.5m). Loss before tax of £0.1m (2015: loss of £1.8m). Trading in line with management’s expectations and delivering to plan. FY17E revenues of £32m and £6.6m pre-tax loss.


Quantum Pharma (QP.L) 34p £42.5m

The service-led, niche pharmaceutical developer, manufacturer  and supplier has announced a proposed placing of £15m at 34p, a small premium of 0.7%. The Placing Shares are being offered by way of an accelerated bookbuild. The Board believes that the Net Proceeds of the Placing will reduce the Group’s net debt to a more appropriate level for a business of Quantum’s type and size. Net debt was £23.8m at 31 July. FYJan17E revenues £83.6m and PBT of £6.9m, 1.47p dividend.


Solid State (SOLI.L) 440p £37.2m

HYSep16 trading update  from the  supplier of specialist industrial/ruggedised computers, electronic components, secure communications systems and battery power solutions to the electronics market. Expects H1 ahead of the equivalent period in 2015 and consistent with market expectations for FYMar17 and a strong debt free balance sheet.  The Group had an order backlog at 30 September 2016 of £14.8m, comprising £12.7m of underlying revenue and £2.1m of Creasefield revenue, acquired in June 2016. FYMar17E rev £44.1m. EPS 34.45. 12.7xPE.


Head Chef:

Derren Nathan
0203 764 2344

*A corporate client of Hybridan LLP


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