Small Cap Feast

Small Cap Feast – 3rd November 2016

Dish of the Day:

Demerger of (GOCO.L) from esure Group plc complete and now trading on main market

Off the Menu:

No AIM Leavers Today

What’s Cooking in the IPO Kitchen?

FreeAgent—Schedule one now out from the provider of accounting software to small businesses. Date and quantum of raise still to be disclosed.

Civitas Social Housing –Intention to float on Main Market from the first REIT to be listed on the London Stock Exchange offering pure play exposure to social housing

Filta— AIM Schedule One update  from  the provider of a number of services to national and independent commercial kitchen operators and owners.   Targets 4 November listing. Seeking £4.3m new equity plus £1.9m shareholder sale


Breakfast Buffet

Conroy Gold & Natural Resources* (CGNR.L) 26p £2.86m

Excellent further results from the recent drilling programme on the Clontibret deposit at the southwestern part of the Company’s Clay Lake – Clontibret gold target.  Gold Zone Extended 30m. The current JORC compliant resource estimate of this zone is 600koz gold at 1.6g/t. Intersecting 5.50m Grading 4.1 g/t Gold. High Grades Include 35.4 g/t Gold Over 0.25m. Wide Intersections Include 11.00m Grading 0.5 g/t Gold. Continuity of Other Known Gold Zones Confirmed.


H&T (HAT.L) 276.5p £102.3m

Trading update from the UK pawnbroker. FyDec16 PBT expected to be above the top end of market expectations.  The principal reason for the strong performance is the higher sterling gold price since the EU referendum result.  The increased gold price benefits the Group’s Pawnbroking Scrap and Gold Purchasing segments.  Growth in lending activities continues, at 31 Oct 2016 the pledge book had increased to £40.5m (30 June 2016: £39.0m) and the Personal Loans book to £8.2m (30 June 2016: £6.3m).  FY16E rev £91.4m, £8.36m PBT. EPS 18.1p. 8.83p div. Expect upgrades.


Mereo BioPharma (MPH.L) 285p £183m

Mereo today announced the positive outcome of its Phase 1 drug interaction study with acumapimod, the active compound in the Company’s novel p38 MAP kinase inhibitor BCT-197. BCT-197 is currently in a Phase 2 study for the treatment of acute exacerbations of COPD (AECOPD).  This study evaluated potential drug interactions between acumapimod and the antibiotic azithromycin. The study confirmed no drug interaction or evidence of adverse effects on safety and tolerability, meaning acumapimod may therefore be dosed with azithromycin.


Servoca (SVCA.L) 25p £31.05m

FY Sep 16 trading update from the specialist recruitment solutions and outsourcing provider.   Expects to report that its results for that period will be in line with market expectations. FYSep16E revenue £69m, PBT £3.5m, EPS 2.2p, dividend £0.3p. 1.2% yield, 11.3x PE.


Artillium (ARTA.L) 6.5p £19.86m

FYJun16 results from provider of innovative telecommunication software and solutions. Significant revenue growth of 25.7% to 9.6 million. Adjusted EBITDA margin of 3.3%. £1.3m cash used in operations. Net debt £1.5m. Acquisitions of Comsys and Livecom have been successfully integrated. Post year end introduced solution for secure and easy identification and authentication of mobile prepaid customers plus new contract and strategic alliance.  Today issued 596k of shares in lieu of consultancy fees.


Rosslyn Data Technologies (RDT.L) 9.5p £7.2m

The global big data technology company, has secured a two year contract worth over $400,000,  $257,500 (£200,000) in the first year and $150,000 (£125,000) per annum thereafter. The contract has an option to extend beyond the term as well as the capability of having additional professional services added. The client is a leading US based global media company which is a household name, having successfully grown organically and through acquisition.  FYApr17 rev of £5.3m and £0.7m pre-tax loss.


Trading update from the provider of transport solutions for businesses, local authorities, the public and private individuals. The Group has made good progress during the year and the longer term trading outlook remains in line with market expectations. Growth has been achieved this year predominantly through acquisition, with the Company making three acquisitions during the year. Some additional non-recurring costs with a minor impact on PBT expected this year.  FYNov16E revenue of £57.4m and PBT of £2.9m.


Tern (TERN.L) 9p £10.36m

The investment company specialising in the cloud and Internet of Things (IoT) sectors, has completed the sale of the assets and business of Concerto, a Multi Cloud Management software business, to Ingram Micro Inc., the world’s largest technology distributor and a leading technology sales, marketing and logistics company for the IT industry worldwide. The total consideration is $500,000 in cash, payable $425,000 on completion with $75,000 at the end of 12 months.  Tern acquired Concerto alongside Flexiant Research in June 2016 for a combined total of £75k.


ZOO Digital Group (ZOO.L) 8p £2.6m

H1Sep16 results from the  provider of subtitling and digital distribution services for the global entertainment industry. Revenues increased by 18% to $7.8m. EBITDA up by 7% to $1.0m, reflecting increase in sales force and continuing R&D. Profit after tax increased to $0.7m (H1 2015: $0.3m).  Overall client numbers grown by 29% over corresponding prior year period. The Board believes that ZOO has the opportunity to grow consistently and win significant market share in digital distribution and localisation.


Kodal Minerals (KOD.L) 0.11p £4.77m

FH1 Sep 16 results from he mineral exploration and development company , a period which saw the completion of transformational acquisitions to gain exposure to lithium and gold exploration projects in West Africa. Cash balances as at 30 September 2016 were £315k compared to £283k at 30 September 2015 and £135k at 31 March 2016. Following the capital raising completed in October 2016, cash balances as at 31 October were £896k. Remains open to further acquisitions of early stage & value accretive strategic mineral opportunities .


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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