Small Cap Feast

10th August 2023

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National Milk Records plc (AQSE: NMRP) has left the AQSE Growth Market.

What’s Cooking In The IPO Kitchen?

Announced ITF 4 August: Tan Delta Systems plc, a Sheffield based Company intends to IPO on AIM. Tan Delta has developed an innovative and differentiated monitoring solution based on real time oil analysis and analytics that offers equipment operators enhanced insight into the maintenance status of their equipment and thus the ability to reduce maintenance costs, improve reliability and reduce carbon footprint. Admission TBC.

Announced ITF 12 July: Substrate Artificial Intelligence, an artificial intelligence company based in Spain that creates, buys and scales companies around AI in diverse sectors such as fintech, agritech, energy, human resources, and health, intends to join the Access Segment of the AQSE Growth Market.

Announced ITF 6 July: Blackpoint Biotech plc, a medical cannabinoids company established to fulfil gaps in the medical cannabis market by creating products that provide fast onset of action and accurate dosing, intends to join the Access Segment of the AQSE Growth Market. Admission delayed.

Breakfast Buffet

Checkit 24p £25.9m (CKT.L)
The intelligent operations platform for the deskless worker, provides an unaudited trading update for the six months ended 31 July 2023 (H1 FY24). Over 50% of H1 FY24 ARR growth resulted from upsell and cross sell within its current customer base. In the US, the group has seen 41% growth in ARR to £3.2m (H1 FY23: £2.3m). Recurring revenue accounted for 95% of total revenue in H1 FY24. Net cash at 31 July 2023 was £12.8m (31 January 2023: £15.6m). Checkit also announces the renewal of its Framework Agreement with John Lewis plc to provide connected workflow, automated asset monitoring and digital building management solutions with improved pricing for a further period of 3 years, with a total contract value of c.£6m. Separately in April 2023, Checkit signed a master service agreement (MSA) with Compass Contract Services (U.K) Limited for the provision of CAM and CWM to their end users, primarily in the food services sector. Since signing the MSA with Compass, Checkit has entered into 3 new contracts with Compass.

Coro Energy 0.245p £6.9m (CORO.L)
The Southeast Asian energy company with a natural gas and clean energy portfolio, announces that the approval of the sale of the Italian portfolio by the Italian regulatory authorities is progressing well and that, the Company has now signed an Addendum to the Sale and Purchase Agreement (SPA) as previously announced on the 27 March 2023. Zodiac Energy plc has agreed to make a further cash advance of EUR 0.7m within 10 business days, which will bring the total advanced to Coro to date to EUR 2.5m. Coro has agreed to reduce the sum due at completion by the Additional Advance and an additional EUR 0.14m. As a result, the final completion payment will be some Euro 1.36m (reduced from the previously announced Euro 2.2m) plus the standard working capital adjustment which is expected to be positive and significant to Coro. Coro is also due a deferred payment of EUR 2.0m which is to be offset with the assignment of the intercompany loan to Zodiac leaving a balance of EUR 0.14m due as soon as practicable following completion. The total potential consideration for the transaction is now therefore EUR 7.4m from the previous EUR 7.5m. All other terms of the SPA disclosed in the Company's announcement of 27 March 2023 remain unchanged.

Dekel Agri-Vision 3.35p £18.7m (DKL.L)
The West African agriculture company focused on building a portfolio of sustainable and diversified projects, provides a July production update for its Ayenouan palm oil project in Côte d'Ivoire (Palm Oil Operation). Fresh Fruit Bunch (FFB) volumes and Crude Palm Oil (CPO) production increased 161.3% and 140.2% respectively compared to July 2022. As it enters the low season, the Company expects the typical softening of production results to take place over the next 1-2 months. CPO sales quantities increased 350.9% in July compared to last year and Palm Kernel Oil (PKO) production increased 127.5% compared to July last year. DKL remains on track to deliver financial outcomes from the Palm Oil Operation in 2023.

ECO (Atlantic) Oil & Gas 15.75p £66.4m (ECO.L)
The oil and gas exploration company focused on the offshore Atlantic Margins, announces that it has signed a Sale Purchase Agreement pursuant to which its wholly owned subsidiary, Eco Guyana Oil and Gas (Barbados) Limited, will acquire a 60% Operated Interest in Orinduik Block, offshore Guyana, through the acquisition of Tullow Guyana B.V. (TGBV), a wholly owned subsidiary of Tullow Oil Plc. The transaction summary is as follows; US$700k cash payment upon transfer of TGBV's 60% Participating Interest and operatorship of the Orinduik licence to Eco Guyana, to be paid to Tullow Overseas Holdings B.V., the parent of TGBV (TOHBV) on completion of the transaction. The contingent consideration payable to TOHBV is linked to the success of a series of milestones. Completion is expected to occur in the second half of 2023. On closing of this transaction, Eco will hold an aggregate 75% Participating Interest via Eco Guyana and Eco (Atlantic) Guyana Inc., and become Operator of the Block; and TOQAP Guyana B.V will continue to hold a Participating Interest of 25%.

eEnergy Group 5.15p £18.1m (EAAS.L)
The net zero energy services provider announces that it has increased its ownership in its subsidiary, eEnergy Insights Ltd (EIL), which holds the Group's MY ZeERO smart metering and analytics platform, to 100% through the acquisition of the minority holdings of two former management shareholders. Related to this transaction, the Company has issued 1,366,666 new ordinary shares of 0.3p in eEnergy to the vendors.

Jarvis Securities 122.5p £54.8m (JIM.L)
The company that operates in the financial services sector, provides a trading update for the financial year ending 31 December 2023. The Board of Jarvis announces that it is declaring a third quarterly interim dividend of 2.25 pence per share, to be paid on 12 September 2023. As previously announced, a Skilled Person was appointed to review the systems and controls of the Company's subsidiary, Jarvis Investment Management Limited (see announcements dated 16 September 2022 and 4 July 2023). The associated restrictions on Model B clients, has led to the loss of certain Model B clients and the corresponding revenue. In addition the costs associated with the Skilled Person review are higher than anticipated. These factors, combined with reduced trading volumes caused by market conditions, mean that the Company is now trading below current market expectations. Net cash at the end of July 2023 was £5.2m.

Marks Electrical Group 98.5p £103.4m (MRK.L)
The online electrical retailer provides a trading update for the four months ended 31 July 2023. Revenue increased 30.7% to £36.2m (4 months FY23 £27.7m) despite the challenging market conditions. The group has increased its market share in Major Domestic Appliances (MDA) and Consumer Electronics (CE) segments. The group maintained industry leading Trustpilot score of 4.8 and reached over 50,000 reviews with 95% of those reviews being 4 and 5 star, demonstrating the best-in-class customer proposition. The group retains a robust balance sheet and net cash position, supporting the proposed final dividend of 0.66p per share, subject to shareholder approval at today's AGM.

Spectral MD Holdings 50.5p £68.7m (SMD.L)
The artificial intelligence company focused on medical diagnostics for faster and more accurate treatment decisions in wound care, yesterday announced its proposed cancellation of Admission to Trading on AIM. As stated in the announcement on April 11, 2023 detailing the planned business combination with Rosecliff Acquisition Corp I, the Board proposes to seek shareholder consent to approve the transaction and cancel the admission of the Company's ordinary shares to trading on AIM. The Board has resolved to implement the cancellation for the following reasons: Delisting from AIM would remove certain complexities and duplication that comes with administering two listing regimes. The Board expects that a Nasdaq-only listing will attract the appropriate investor base and investment style, maximizing the Company's ability to access deeper pools of capital. Moreover, existing shareholders will be able to own, trade, and transfer shares of the combined company following the transaction.

Tern 5.5p £21.4m (TERN.L)
The investment company specialising in supporting high growth, early-stage, disruptive Internet of Things (IoT) technology businesses, announces a number of changes to the board of the Company and the Company's management structure. Matthew Scherba and Bruce Leith have both stepped down from the Board with immediate effect. Bruce Leith will remain with Tern as an employee and a member of its senior management team. Sarah Payne will step down as the Company's Chief Financial Officer and Company Secretary on or before 30 September 2023 to take up a position with another company, but will remain on the Board as a Non-Executive Director. In addition, Tern is implementing other cost saving measures which is expected to save approximately 40% of its overall central costs in 2024, compared to the level for 2022.

ZOO Digital Group 65p £63.5m (ZOO.L)
The provider of end-to-end cloud-based localisation and media services to the entertainment industry, announces its audited results for the year ended 31 March 2023. Revenue grew by 28% to $90.3m (FY22: $70.4m), with 3% of sales from newly acquired operations. Adjusted EBITDA grew to $15.5m (FY22 restated: $7.1m). Operating profit quadrupled to $8.1m (FY22 restated: $1.9m) and ZOO reported profit before tax of $7.9m, after a previous FY22 loss of $0.2m. Net cash at year-end was $11.8m (FY22: $6.0m). Current trading has been impacted by several major streaming companies carrying out strategic reviews to refocus on profitability and the simultaneous strike of US writers and actors. This has created short-term market disruption and temporarily lower volumes of localisation and media services work. The Board has been taking steps to adjust the cost base to reduce the impact. Guidance for FY24 remains unchanged and its 2030 strategy remains on track.

10 August 2023
*A corporate client of Hybridan LLP or retained by Hybridan LLP for certain services
** Arranged by most recent first
*** Alphabetically arranged


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