Small Cap Feast

Small Cap Feast – 24th January 2017

Dish of the Day:

No AIM Joiners Today

Off the Menu:

No AIM Leavers Today

What’s Cooking in the IPO Kitchen?

Impact healthcare REIT— Intends to float on the main market. Seeks to raise £160m to acquire a portfolio of up to 58 care homes. Expected Admission 7 March.

Eco (Atlantic) Oil & Gas—TSX-V listed oil and gas  exploration has announced its intention to float on AIM. Assets in Guyana and Namibia. Proposed £2m-£3m fundraise.

Diversified Gas & Oil—According to LSE website first day of trading on AIM now expected for 30 January.


Breakfast Buffet

CAP-XX (CPX.L) 9.13p £24.7m

The specialist in supercapacitors has raised gross proceeds of £2.43m in a subscription at 9p. The proceeds will be used to accelerate a number of development opportunities. We can see no forecasts in the market. The Company is exploring numerous innovative opportunities in electronics and other areas where its ultra thin supercapacitors can be used for power supply, both through licensing partners and a direct sales model.


Next Fifteen Communications (NFC.L) 328p £240.6m

FYJan17 trading statement from digital communications group. ‘Expects results to be in line with market expectations and the Board expects the Group to make further good progress in the year ahead.’ It has made a series of acquisitions including Publitek and Pinnacle, which are specialists in digital content and marketing for advanced technologies. The Group also acquired Twogether, a specialist B2B digital marketing agency; HPI a market research business; and took an investment stake in Phrasee, an AI email marketing technology Company. Since July 2016 the Group has added notable additional business from General Motors, Unilever, KPMG and Deliveroo. Benefitting from 60%+ US exposure. FYJan16e rev £168.39m, PBT £23.27m.


Restore (RST.L) 364.5p £408.7m

The UK office services provider, confirms that trading for the year ended 31 December 2016 was in line with expectations. Document Management: Integration of recent acquisitions largely complete. Shredding capabilities transformed by PHS Datashred. Relocation Division: Steady year on year growth with strong Q4. FY16E £132.26m rev, PBT £22.27m, EPS 17.04p, div 3.91p.


Ariana Resources (AAU.L) 1.85p £16.6m

The gold exploration and development Company operating in Turkey, announced results for its Phase Two drilling programme of 2016, completed in December at the Kiziltepe Project.  Vein mineralisation intercepted in every drill hole with robust infill drilling results from the south-western end of Arzu Central providing 7m @ 4.00 g/t Au + 27.51 g/t Ag, 12m @ 1.96 g/t Au + 34.45 g/t Ag and 11m @ 1.83 g/t + 45.07 g/t Ag. Newly identified vein system within Arzu Central provides results including 11m @ 0.95 g/t Au + 35.91 g/t Ag and 2m @ 1.64 g/t Au + 35.70 g/t Ag. Arsenopyrite-rich style of mineralisation encountered c.70m from a previous bonanza-grade hole (12.1m @ 13.1 g/t Au+ 188 g/t Ag) provides an intercept of 11m @ 2.24 g/t Au + 11.06 g/t Ag.


Maintel Holdings (MAI.L) 887.5p £126m

FY Dec16 trading update from the systems integrator and managed services provider. Trading in the second half of the financial year has been encouraging, with both full year revenue and profit now expected to be marginally ahead of the Board’s expectations. In addition, cash generation has been particularly strong and net debt of £21.5m is now expected to be lower than previously indicated. Restoration of momentum in the organic Maintel business pre-Azzurri has been especially pleasing, with a significant improvement in the second half. Organic Maintel revenue for the full 12 month period is now expected to show a slight increase against the prior year, following a reported 8% decline in H1. FYDec16E rev 107.8p, EPS 65.99p, Div 30.77p.


Sprue Aegis (SPRP.L) 176p £80.7m

FYDec16 trading update from the  home safety products supplier. Sales are expected to be approximately £57.1m (2015: £88.3m) and the operating profit* (post a £0.2m restructuring charge) is expected to be approximately £2.1m (2015: £12.8m).  The Group delivered an improved performance in the second half with an estimated H2 2016 operating profit of £3.0m (H1 2016: operating loss of £0.9m before share based payments charge).   France weak but Germany strong and further strength in Germany expected due to regulatory drivers. £14.3m cash (from £22.4m).


Strat Aero (AERO.L) 0.22p £0.86m

The aerospace Company focused on the rapidly emerging Unmanned Aerial Vehicle  sector,  has raised £380k at 0.1p with 418m 2 year warrants granted exercisable at 0.225p. Strat Aero, by focusing on its two core divisions, continues to develop revenue growth opportunities whilst pursuing a vigorous cost reduction programme. Reducing the Company’s cash burn run rate remains a top priority within the Group with the goal ultimately that Strat Aero will become cash generative by the end of the financial year ending 31 December 2017.  The Funds raised via this placing will be used to support the continued working capital requirements of the business while the Company work towards this goal.


Fevertree Drinks (FEVR.L) 1135p £1.3bn

FYDec16 trading update from the supplier of premium carbonated mixers saw strong growth achieved in the first half of the year accelerated in the second half of 2016.  It is expected that sales in the second half will be ahead of the prior year period by 75%. As a result, full year revenue is expected to be circa £102.2m, reflecting growth of 73% on 2015. Over the period, Fever-Tree’s free cash flow generation and balance sheet have remained strong. The sales in the final two months of the year, particularly in the UK, were stronger than anticipated and therefore the Board expects that the outcome for the full year will be materially ahead of its expectations.  FY2016E £93.9m rev, PBT 31.13m, div 5.19p.


Colefax Group (CFX.L) 540p £55.19m

HY OCT16 results from the International designer and distributor of furnishing fabrics & wallpapers and Interior designer. Group sales of £39.53m (2015: £37.98m). Group pre-tax profit of £1.90m (2015: £3.27m) affected by: challenging conditions in core US market and hedging losses following decline in Sterling. “We have continued to invest in our business with significant one-off capital expenditure this year and expect to see a positive benefit from our new US showrooms and new Decorating Division premises in London. The Group has a strong balance sheet and we will continue to invest with confidence in our diverse portfolio of brands” FYapr17E PBT £4m off rev of £73.4m.


Empresaria Group (EMR.L) 121.5p £59.56m

FYDec16 trading update from the international specialist staffing group.  Full year profitability will be slightly ahead of market expectations.  Adjusted profit before tax growth is expected to be approximately 23% year on year, representing a record profit level for the Group.  Net fee income is approximately 20% ahead of the prior year and diluted adjusted earnings per share is expected to be up 12% on the prior year.  Continues to see exciting growth opportunities for the Group in 2017. Investments in Rishworth Aviation and ConSol partners performing well. FY16E rev £234m and PBT £9m. PE 10.6x. Yield 0.9%


Head Chef:

Emily Liu, CFA, CAIA
0203 764 2344

Sous Chef:

Sacha Morris
0203 764 2345

*A corporate client of Hybridan LLP


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