Small Cap Feast

Small Cap Feast – 30th January 2017

Dish of the Day:

Rainbow Rare Earths has joined the LSE’s standard list segment having raised $8m. At 10p

Off the Menu:

No AIM Leavers Today

What’s Cooking in the IPO Kitchen?

Indigo Holdings— The Investment Vehicle for the purpose of making investments and/or acquisitions in the Middle East Frontier Markets, including the United Arab Emirates, Iraq, Kuwait, Qatar and Oman is expected to start trading on NEX on or around 10 February

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.


Breakfast Buffet

InnovaDerma* (IDP.L) 136p £16.1m

The UK developer of ‘at-home’ and clinically proven treatments for hair loss, hair care, self-tanning and skin rejuvenation, announced the appointment of Kieran Callan as a Non-Executive Director with immediate effect, succeeding Garry Lemair who stepped down from the Board on 10 January 2017.  Mr. Callan has more than 30 years of experience in the FMCG and retail sector with a strong track record of devising and implementing strategies for growth companies.  He also brings with him extensive experience in M&A including deal execution and integration of acquired businesses. InnovaDerma expects to publish H1 Dec 16 results on 9 February.


ATTRAQT Group (ATQT.L) 48.5p £13.07m

FY Dec16 results from provider of visual merchandising, ecommerce site search and personalised recommendation technology. Revenue growth of 22% to £3.6m. Recurring revenue increased 22% to £3.2m. Adjusted EBITDA losses were £1.6m, in line with expectations, reflecting the accelerated investment in the business. Separately ATTRAQT has announced a £27.5m placing and £1m open offer at 35p to fund the transformational acquisition of Fredhopper, a cloud-based provider of onsite search, navigation, recommendation and visual merchandising solutions through a global SaaS platform. Total consideration of £25 million. 3 year CAGR rev growth of 18.5% to 2016 (£11.1m) with 2016 EBITDA of £3m.  This is an RTO, the shares are to be suspended. Expected lifting of suspension on or after 7 March 2017.


PhotonStar LED Group (PSL.L) 1.13 p £2.1m

FYDec16 trading update from  the British designer and manufacturer of intelligent lighting and building control solutions.  Challenging trading conditions in H2. As such the Group’s results for the year are expected to be below current market expectations. FY revenue of circa £5.4m (£6.9m).  Reduction due to the continued price pressure in the more traditional area of light fixtures, the on-going emphasis on transitioning itself away from light fixtures and into intelligent lighting solutions and building control systems & market uncertainty following the “Brexit” referendum which has had a negative impact on existing and potential customers. Further restructured in Q4. Key technical demonstrations of halcyon TM & cloudBMS TM products at IBM interconnect 2016 highlight the future of the Group & future growth prospects.


Falanx Group (FLX.L) 6.25p £7.86m

Operational update from  the global intelligence, security and cyber defence provider.  Opened  new Cyber Security Operations Centre in the heart of Birmingham City Centre, in order to supply the significant increase in demand for cyber services.  Creates a three-fold increase in Operational capacity while decreasing fixed overhead by 20%. Phase one of hiring programme complete. Cyber Sales continue to grow; Falanx Cyber Defence has secured a new Security-as-a-Service contract with a major IT Services Plc of £136k per annum and extension of services to a major UK Bank of £130k. Remains on track to achieve profitability and positive cash flow next financial year.


Redcentric (RCN.L) 93.75p £139.56m

The UK IT managed services provider Redcentric has announced one of its most significant public sector wins to date, with the award of the new Peering Exchange contract, which forms the core of the new Health and Social Care Network (HSCN). NHS Digital has selected Redcentric on an initial three-year agreement with the option to extend for a further three years.  FYMar17Ev revenue of £112.37m and PBT of £14.9m, div 2.72p.


Hydrodec Group (HYR.L) 2.03p £16.27m

the cleantech industrial oil re-refining Group. Revenues from continuing core re-refining business expected to increase by approximately 100% to  US$16.4m, reflecting the full recommissioning of the Canton plant at  the end of 2015.  Continued improvement of plant operability, with an average utilisation rate of 73% achieved for  the year.  Group EBITDA loss from continuing operations significantly reduced in the year and expected to be  marginally above market expectations.  Group EBITDA expected to be positive for Q4 2016. Measures in place ‘ should enable Hydrodec to deliver positive Group EBITDA for 2017 as a whole.’


Sopheon (SPE.L) 336.5p £24.77m

FY Dec16 trading update from the international provider of software and services for complete Enterprise Innovation Management solutions.  H2 momentum  continued to translate into a strong performance in the second half of 2016, driven by a large number of license orders in the final quarter, including substantial activity with major enterprise customers. In addition to the effect of the stronger sales performance, the profitability of the business was further enhanced by cost efficiencies over the course of the year, and to a lesser extent by foreign exchange gains linked to the sharp fall in Sterling. Revenue in line and PBT expected significantly ahead of market expectations. FY16E rev £18.64m, PBT £1.66m.


Scancell Holdings (SCLP.L) 14.62p £38.25m

The Addario Lung Cancer Medical Institute (“ALCMI”), the Bonnie J. Addario Lung Cancer Foundation (“ALCF”) and Scancell  today announced a collaboration to evaluate the use of Scancell’s second innovative cancer vaccine, SCIB2, from its ImmunoBody® platform to treat non-small cell lung cancer. The Addario Advanced Collaboration Program brings patients into clinical trials from ALCMI’s extensive research consortium of international researchers & member institutions & ALCF’s patient support programs. ALCMI plans to assist Scancell in the design & development of a P1/2 clinical trial with SCIB2 in patients with NSCLC which is planned to begin in  2018 and complete approximately 18mths later.


Mi-Pay Group (MPAY.L) 19p £7.9m

FY Dec16 trading update from the provider of outsourced digital transformation and mobile payment solutions to Tier 1 Mobile Network Operators and Mobile Virtual Network Operators. Trading for the year ended 31 December 2016 has been in line with market expectations. Total revenue for the year is expected to be £3.3m (£3.0 m) and the Company has continued to experience strong growth in transactions, delivering an increase in payment transaction values processed to £83 million during the year (2015: £65 million). Cash position flat at £3.5m. The Company has also delivered further year on year reductions in administrative expenses.


Yu Group (YU..L) 325p £45.68m

FY Dec16 trading update from the independent supplier of gas and electricity to the UK corporate sector. It is anticipated that Group revenues for the year will be slightly ahead of current market forecasts and management’s expectations at the time of the interim results announcement on 20 September 2016.  Gross margins in the year have remained firm. In line with the growth of the business, there has been a commensurate increase in fixed costs and headcount. The Board remains confident that the Group will report results in line with market expectations for FY16. FY16E rev £15.1m and PBT of £0.1m. Div 2p.


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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