Small Cap Feast

Small Cap Feast – 21 July 2020

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What’s Cooking in the IPO Kitchen?

AEX Gold (TSXV:AEV) is intending to admit its shares to AIM alongside a £45m placing. The Company, led by CEO Eldur Ólafsson, has established the largest land package of gold assets in Greenland with a current portfolio of licences covering 3,356 square kilometres, in the two known gold belts in Southern Greenland, the Nanortalik and Tartoq gold belts. Nalunaq is a high-grade gold asset with an updated Inferred Mineral Resource covering 422,770 tonnes at 18.5 grams per tonne of gold, or 250,970 ounces of gold, which covers the area in and around the historical mine.  Due July.  Current mkt cap C$66.7m.

 

Breakfast Buffet

Deltic Energy 0.85p £12m (DELT.L)

On 15 July 2020, Reabold Resources plc  announced a potential all share offer for the issued and to be issued share capital of Deltic Energy .

After consideration of the Proposed Offer with its advisers, on 16 July 2020, Deltic Energy announced that its board had rejected the Proposed Offer.

 Deltic  today announced that on 20 July 2020 it received a letter from IPGL (Holdings) Limited (“IPGL”), a company controlled by Michael Spencer, and the largest shareholder in Deltic.  In this letter, , IPGL stated its intention not to support the Proposed Offer and reiterated its continuing support of Deltic’s management team, its technical capability, focused asset base with high impact potential and current strategy.   

 

KRM 22 28 £7.5m (KRM.L)

The technology and software investment company that focuses on risk management for capital markets, today issues a trading update for the 6 months to 30 June 2020 .

The first half has been impacted by the effects of COVID-19 but progress has been made with two new customer wins and cost and debt reduction in the Period. 

As described in the trading update of 2 April 2020, the Company has experienced slowed business activity and extended sales cycles as customers and prospects have transitioned to home working and with the increased operational burden resulting from market volatility. Notwithstanding the backdrop, the Company has secured two new customers in the period and sold additional products to an existing customer adding an aggregate of £0.3m in ARR in the period resulting in a total ARR as at 30 June 2020 of £4.0m (which excludes a disputed contract with ARR of £0.3m). The new contracts include the purchase of Enterprise and Market Risk products.

 

REACT Group 1.25p £6.2m (REAT.L)

The specialist cleaning, hygiene and decontamination company, is delighted to announce it has been awarded a number of contracts from one of its large Facilities Management (“FM”) customers to provide specialist deep cleaning services to a number of sites across the United Kingdom.

The batch of twelve contracts, worth just over £350k will run for a period of five weeks through to the end of the August 2020.  They each require experience and specialist skills core to the REACT business, including safe working practices at height and in potentially hazardous environments.

These contracts are incremental to the work REACT carries out for this customer and is non-COVID-19 related.

 

SDI Group 59p £57.5m (SDI.L)

The Group focused on the design and manufacture of scientific and technology products for use in digital imaging and sensing and control applications, announced its final audited results for the year ended 30 April 2020.

  • Revenue increased 41% to £24.5m (2019: £17.4m) · Revenue growth both organic (4%) and from acquisitions (36%), reflecting full year contributions from Fistreem International, Thermal Exchange, Graticules Optics and MPB Industries
  • Adjusted operating profit increased 48% to £4.6m (2019: £3.1m)

o  Reported operating profit increased 60% to £3.5m (2019: £2.2m)

  • Adjusted profit before tax increased 44% to £4.3m (2019: £3.0m)

o  Reported profit before tax increased 54% to £3.3m (2019: £2.1m)

  • Adjusted diluted EPS increased 23% to 3.43p (2019: 2.83p)

SDI Group has started the current year in a strong financial position and a number of our companies have seen increased demand for medical products which are being used to address the COVID-19 challenges. Other companies within the Group face some uncertainty and a downturn in orders although all our manufacturing facilities remain in operation. There are early signs of a return to normality in trading and overall SDI remains profitable and cash generative. SDI continues to seek acquisitions and looks forward to growing organically and through acquisition as conditions improve.

 

Conroy Gold 23.5p £6.2m (CGNR.L)

  • Heads of Terms signed for proposed Joint Venture with Anglo Asian Mining
  • The Joint Venture goal is the development of a gold mine and further exploration and development along the district scale gold trend which the Company has discovered in Ireland
  • Anglo Asian Mining to acquire an i initial 17.5% working interest in the Joint Venture for committing to spend €2 million on a primary expenditure programme
  • Option to increase working interest to 25% by spending a further €2 million to complete the Primary Expenditure Programme of a minimum of €4 million
  • Further option to acquire a total 55% working interest in exchange for committing to meet the expenditures of the Secondary Expenditure Programme in order to advance the Clontibret Gold Deposit to mine construction ready status and certain further exploration expenditures
  • 325,000 Warrants to acquire ordinary shares in Conroy Gold at 16p issued to Anglo Asian with further warrants proposed to be issued upon completion of the final Joint Venture Agreement

 

Thor Mining 0.37p £4.7m (THR.L)

High grade uranium and vanadium assay results from Colorado mineral claims held by American Vanadium Pty Ltd (AVU). AVU holds interests in uranium and vanadium focussed projects in Colorado and Utah in the United States of America. The Company announced on 1 June 2020 an option agreement to acquire AVU, subject to satisfaction of due diligence requirements. These final high-grade uranium assays are from 13 outstanding samples deemed too radioactive for the original laboratory.

  • The 13 assay results averaged 0.706% U3O8 and 1.36% V2O5.
  • Four samples assayed 1.0% U3O8 or greater with a best uranium assay of 1.25%U3O8
  • Three samples assayed over 2%V2O5 with a best vanadium assay of 3.47% V2O5
  • Samples previously tested and reported were also assayed in the Hazen laboratory with results slightly above, but broadly confirming the earlier report.

 

Frontier IP 59p £30m (FIPP.L)

Further to the announcements made yesterday, FIPP announced the successful completion of the Capital Raising at an Issue Price of 55 pence per share.

The Placing and PrimaryBid Offer were comfortably oversubscribed and, as a result, in aggregate comprise of the maximum available number of 4,243,140 New Ordinary Shares, raising gross proceeds of approximately £2.33 million for the Company. The Issue Price represents a 14.1 per cent. discount to the closing middle market price of 64 pence on 17 July 2020,Net proceeds of the Capital Raising to:

o  support the ongoing working capital needs of the business, including to increase headcount to increase Frontier’s capacity to provide commercialisation and development services for its portfolio companies; and

o  flex the Company’s business model to include both bridge funding and direct participation in investment rounds for portfolio companies.

 

Minoan Group 1.2p £5.25m (MIN.L)

Minoan announced the successful reorganisation of its only secured borrowings , the cancellation of warrants and rights to future warrants and a small pre funded placing to provide further working capital.

 Whilst the transaction is complicated and involves short term cost it will result in a significant reduction in the long term fully diluted capital for the benefit of all shareholders.

The Company has also announced today that it is proposing to raise approximately £200,000 through the issue of new Ordinary Shares at a price of 1.1 pence per share. The Chairman, Christopher Egleton and two directors of subsidiary company Loyalward Limited, being David Raby and Nicholas Day, have indicated their intention to participate in this placing.

 

Ergomed 585p £283m (ERGO.L)

The company focused on providing specialised services to the pharmaceutical industry, today announces a trading update for the first half of 2020.

EBITDA for FY 2020 expected to be materially ahead of market expectations

  • Integrated pharmaceutical services business demonstrates resilience during Covid-19
  • Total revenue growth of 14.8% over H1 2019; like for like service fee revenue up 18.0% over H1 2019
  • Order book up 22.0% since 1 January 2020 provides high visibility into H2 2020 and beyond
  • Strong cash balance of £14.1 million and debt free

 

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

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