Small Cap Feast

Small Cap Feast – 7th January 2022

Dish of the Day:

No Joiners Today.

Off the Menu:

Ridgecrest (Formerly Nakama Group) has left AIM.

What’s Cooking in the IPO Kitchen?

Carbon Air, a nano-technology company which leverages the adsorption properties of activated carbon and other advanced materials to improve suspension systems, enhance acoustics or reduce noise, to join AIM. The Company’s proprietary technology has allowed it to develop a unique portfolio of solutions for a variety of sizeable end markets, including vehicle suspension systems, acoustic insulation for domestic appliances and micro-speakers for smartphones. Mkt Cap and Capital to be raised TBC. Due Late Jan.
i(x) Net Zero, the investing company which focusses on Energy Transition and Sustainability in the Built Environment, announces its intention to join AIM and raise money to provide development and expansion capital to certain of its investee companies, for future investments in companies that fall primarily within its areas of interest in Energy Transition and Sustainability in the Built Environment and to provide working capital for the Group. Capital to be raised £20m. Expected admission date Late Jan 2022.
Superdielectrics to join AIM, a Company which is focused on developing technology to build supercapacitors with high energy density, low cost, and environmentally benign electrical energy storage devices that will help create a clean and sustainable global energy and transportation system. Admission is expected to take place in mid Jan 2022.
Spiritus Mundi due to join the Main Market (Standard), a special purpose acquisition vehicle which will seek acquisition targets in Europe and Asia in the clinical diagnostics sector. The Company has already raised approximately £1.2m in a pre-IPO fundraising round. Due late Jan 2022.
Recycling Tech Group to join AIM, a UK-based engineering, research and manufacturing company that has developed a modular and mass producible machine, the RT7000, which processes hard to recycle plastic waste into a synthetic oil that can be sold back to the petrochemicals industry as a chemical feedstock to make new plastics. Targeting a £40m raise. Due early Q1 2022.
Nu-Oil and Gas to acquire Guardian Maritime Ltd and Guardian Barriers IP Ltd and become Guardian Global Security plc and join the Main Market (Standard). Guardian is a technology group that supplies products to prevent unauthorised entry into areas that are deemed to have value, with maritime security being the main focus initially. Due 24th Jan 2022.

Breakfast Buffet

Air Partner 88.9p £56.5m (AIR.L)

Following the announcement made by Air Partner, the global aviation services group, on 17 December 2021, the Company reported a further positive update on trading for the 12 months to 31 January 2022. As a result of continued strong customer demand throughout December, the Board of Air Partner now expects that underlying profit before tax for the 12 months to 31 January 2022 will be materially ahead of market expectations at the time of the December 2021 trading update. December’s performance has again been driven by high levels of Freight bookings, notably for the continued transportation of vaccines. The Group’s cash position remains strong with net cash of £12.9m as of 31 December 2021 (31 July 2021: £9.8m), excluding both customers’ segregated JetCard deposits and a £1.4m provision for deferred consideration and other items relating to the acquisition of Kenyon International Emergency Services Inc.

Aston Martin Lagonda Global Holdings 1,406.75p £1,638m (AML.L)

FY 2021 trading update. Wholesales grew 82% to 6,182 as planned; 3,001 DBX units wholesaled in first full year of production taking estimated 20% market share of the luxury SUV segment. Retails (dealer sales to customers) greater than wholesales for both GT/Sport and DBX as aligned supply to demand and as it operates as a true luxury brand. Following an extensive and challenging development and testing schedule which has now successfully completed, the game-changing Aston Martin Valkyrie hypercar programme is in production and deliveries to customers have commenced; with a quality focused production ramp-up, 10 Aston Martin Valkyrie and Valkyrie AMR Pro vehicles were shipped in Q4. This was fewer than previously planned and accordingly, adjusted EBITDA is anticipated to be c.£15m lower than expected. The impact is timing only, all Aston Martin Valkyrie Coupes are sold and remain allocated to customers with significant deposits. An associated reduction in 2021 depreciation and amortisation is expected to result in a broadly net neutral impact on adjusted operating profit. This timing change will see deliveries and the associated EBITDA continue through 2022 as planned and now through 2023.

Ceres Power 884p £1,686m (CWR.L)

The specialist in fuel cell and electrochemical technology, confirmed that further to the 21 October 2021 announcement of Eric Lakin’s appointment as Chief Financial Officer, Eric will join the Company on Monday, 10 January 2022. Eric will become a member of the Board of Directors with immediate effect, replacing Richard Preston who will step down from the Board on the same date. Richard will remain with Ceres for sufficient time to ensure a smooth transition of responsibilities. Ceres also announced the appointment of Deborah Grimason as General Counsel and Company Secretary. Deborah will join the Company on Monday 17 January 2022. Reporting to the CEO Phil Caldwell, Deborah will join the Executive team and assume overall responsibility for the Legal team as well as Ceres’ Corporate Governance requirements working closely with the plc Board. Previously, Deborah was General Counsel and Company Secretary at V.Group and Travis Perkins plc., before which she held senior legal and company secretarial positions at Lafarge, The BOC Group, Nokia and Royal Mail.

Essentra 343.75p £1,037m (ESNT.L)

FY 2021 pre-close trading update from the global provider of essential components and solutions. Strategic reviews of Filters and Packaging divisions are progressing as planned following the Board’s decision to become a pure play Components business. As previously guided, both reviews are likely to conclude in Q2 2022 earliest. Overall, a strong Q4 performance, revenue increased 12.7% on prior year on a like-for-like basis and 11.1% vs. Q4 2019. Components: another positive performance, LFL trading days adjusted revenue c.18.5% in Q4 2021. Packaging: an improving trend with the division returning to LFL growth of 1.1% in Q4 2021. Filters: a strong performance led by higher volumes of outsourcing, 22.3% in Q4 2021. The Company expects to deliver FY 2021 operating profit in the range of analysts’ forecasts.

Gemfields 13.5p £160.9m (GEM.L)

Update on the proposed sale of its interest in Sedibelo Platinum Mines Limited. At the time of the Company’s announcement on 13 November 2020, Gemfields held its stake in SPM via an interposed vehicle named Pallinghurst Ivy Lane Capital S.à r.l., a company incorporated in Luxembourg, which in turn had an interest in 27.64% of SPM. Ivy Lane has now been “unbundled” such that Ivy Lane’s 27.64% shareholding in SPM, as well as Ivy Lane’s surplus net assets, have been transferred to Ivy Lane’s shareholders in accordance with their respective equity holdings in Ivy Lane. Gemfields therefore now holds its 6.54% stake in SPM directly. SPM is a public (unlisted) company incorporated in Guernsey and owns and operates the Pilanesburg Platinum Mines located in South Africa’s Bushveld Igneous Complex. SPM dispatched and sold approximately 128,800 4E PGM ounces (comprising platinum, palladium, rhodium and gold) and generated EBITDA of approximately USD113m in its financial year ending 31 December 2020 (nine months to September 2021: approximately 68,800 4E PGM ounces and EBITDA of approximately USD 45m). Gemfields understands that SPM is planning an IPO in 2022. As previously announced, SPM is not considered a core part of Gemfields’ strategy. Gemfields invites interested parties to contact Liberum Capital Limited, who have been appointed by Gemfields to manage an orderly disposal of Gemfields’ SPM shares.

Judges Scientific 8,410p £531m (JDG.L)

The Board of Judges Scientific plc, a group focused on acquiring and developing companies in the scientific instrument sector, provides the following update on the Group’s trading performance for the financial year ended 31 December 2021. 2021 was a year of recovery for the Group from the worst impact of Covid-19. The adaptability of the sector and its customers coupled with the reduced severity of lockdowns and university closures enabled year-on-year Organic order intake to increase by 25.1%. Further, despite the remaining commercial challenges still caused by Covid-19, Organic order intake was up 8.5% against 2019, which was the previous record year for the Group. The Group starts 2022 with a strong order book. Organic growth in bookings and a good performance by recently acquired businesses propelled our year-end total order book to 22.5 weeks. The Organic order book was 21.9 weeks at 31 December 2021 (31 December 2020: 14.7 weeks). Order intake remains the main driver of performance and consequently the recovery in orders resulted in good progress in revenues. Organic revenue, which was 5% ahead in the first half, accelerated in the second half to reach double-digits for the year as a whole. As a result of the positive performance of the Group, the Board now anticipates that Adjusted Earnings Per Share for the full year ended 31 December 2021 will be ahead of market expectations.

Red Rock Resources 0.58p £7m (RRR.L)

The natural resource development company with interests in gold and base metals, announces the results of the first batch of 950 samples from its recently completed 2021 phase 1 RC drilling exploration programme in the mid KKM prospect at the Mikei Gold Project (MGP) in Kenya. Highlights: A total of 20 drill holes totalling 2093 meters were completed as part of phase 1 RC Drilling Programme. Sampling and logging was done at 1m intervals by our in-house geological team prior to being sent to SGS limited in Mwanza, Tanzania for accredited laboratory assay. Results are of first batch of 950 samples from 9 out of the 20 drill holes. Final batch of Phase 1 drilling samples awaiting customs clearance. Highlight intercepts include (complete collar and assay tables available at the bottom of this release). KKRC102: 17m @ 1.02 g/t Au from 116m to 133m (including 1m @ 3.15 g/t Au); KKRC082: 6 m @ 1.17 g/t Au from 8m to 13m (including 1m @ 3.75 g/t Au); KKRC101: 4m @ 1.37 g/t Au from 83m to 87m (including 1m @ 2.7 g/t Au).

Renalytix 545p £394m (RENX.L)

Jean M. Casner joined the Company this week on January 3, 2022 as Senior Vice President & Chief Human Resources Officer. Ms. Casner will be responsible for Renalytix’s global human resources organisation, including people strategy, compensation, benefits, learning and development, diversity & inclusion, and performance and talent management. Ms. Casner joins Renalytix from her former position as Senior Vice President & CHRO at Cantel Medical, which experienced significant annual revenue growth during her tenure prior to the company being recently acquired. During her time at Cantel, she made significant contributions to the company, including creating and implementing a global compensation and benefits strategy, developing and executing a refreshed annual incentive plan as part of Cantel’s total rewards strategy and implementing a global learning platform. Prior to Cantel, she held HR leadership positions at the National Basketball Association (NBA), Merck, The Dial Corporation (now owned by Henkel), Johnson and Johnson and ORC (now owned by Mercer). Ms. Casner succeeds Trent Bingham who departed Renalytix on December 31, 2021. Renalytix is the global founder and leader in the new field of bioprognosisTM for kidney health.

SDI Group 212.5p £213m (SDI.L)

The Group focused on the design and manufacture of scientific and technology products for use in digital imaging and sensing control applications announced the acquisition on 05 January 2022 of Scientific Vacuum Systems Ltd (SVS), a UK manufacturer of physical vapour deposition equipment. Total consideration, including earnout, is forecast to be approximately £4.9m, net of cash acquired. SVS specialises in custom Physical Vapour Deposition (PVD) systems for the deposition of thin film coatings typically on semiconductor wafers, for use in scientific research, industrial and semiconductor manufacturing applications. SVS are market leaders in the manufacture of production sputter coaters for premium brand razor blade coating. Revenues for the year to September 2021 were approximately £2.5m and EBIT of £0.7m. Acquisition expected to be immediately earnings enhancing.

System1 Group 415p £53.5m (SYS1.L)

The marketing decision-making platform, announces its intention to commence a share buyback programme, using the Company’s existing cash resources to make market purchases of System1 ordinary shares for an aggregate value of up to £0.75m in order to enhance shareholder returns and to satisfy obligations in relation to employee share schemes.

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