Small Cap Feast

15th November 2022

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Rosneft Oil Company GDR has left the Standard Segment of the Main Market.

What’s Cooking In The IPO Kitchen?

Long Term Assets Limited (LTA), a Guernsey investment company, intends to join the Specialist Fund Segment of the Main Market of the London Stock Exchange. The initial portfolio is made up of a diversified range of assets, recently valued in the region of £160m, comprising a complete selection of the Disruptive Capital’s family office private asset portfolio. LTA aspires to be a “best-in-class” private assets vehicle, targeting 0.55% per annum management fee and typically a 7 to 8% p.a. hurdle rate of return. Date and amount to be raised TBD.

One Health Group plc, intends to join the AQSE Growth Market. The group provides medical services, in the form of elective surgical care, to support the NHS in the management of patients, through a growing network of community-based outreach clinics and independent hospitals. One Health is a cash generative and profitable company, with an adjusted EBITDA for the year ended 31 March 2022 of £1.2m, on revenue of £17.5m. Due 24 November 2022.

Life Sciences REIT plc (LABS.L), the AIM listed real estate investment trust focused on UK life science properties, announces that, in accordance with the intention expressed at the time of the Company’s initial public offering on AIM, the board has determined to apply for the Company’s existing ordinary shares to be admitted to listing on Premium Segment of the Main Market. The Company’s admission to trading on AIM will be cancelled with effect from Admission. Anticipated early December 2022.

BWP REIT, a newly formed single asset company, announces its intention to raise £35m at the issue price of £1 per share, to acquire Bridgewater Place, an office-led mixed use property situated in central Leeds and valued at £63m. BWP REIT will apply for listing on the Wholesale Segment of the International Property Securities Exchange (IPSX). Due 16 November 2022.

World Chess plc, a leading chess organisation, intends to join the Main Market. World Chess Plc is the holding company of a group which aims to promote the mass market appeal of chess


Breakfast Buffet

AdEPT Technology Group 112.5p £28.2m (ADT.L)

The independent providers of managed services for IT, unified communications, connectivity, voice and cloud services, announces its unaudited results for the six months ended 30 September 2022 (H1 FY23). Revenue was flat at £34.2m, impacted by global supply chain issues. Underlying EBITDA was £5.4m, down 5% year-on-year. The Group’s £7.3m convertible loan note is at a fixed interest and senior net debt is anticipated to reduce significantly over the coming 12 months. Short-term outlook remains challenging but the Board considers the long-term prospects to be as strong as ever.

Crossword Cybersecurity* 21p £19.4m (CCS.L)

The cybersecurity solutions company focused on cyber strategy and risk, announces the completion of a project to expand the scope of its services with CCN-CERT, the Information Security Incident Response Team (CERT) of the National Cryptologic Centre in Spain (CCN), which is accountable to the Spanish National Intelligence Centre. CCN-CERT has expanded its use of Crossword’s cloud-based breached account mining platform, Trillion , to protect its entire public administration, including its education sector. Trillion is Crossword’s breached account mining platform, which continuously tracks, correlates and analyses billions of stolen usernames and passwords.

Destiny Pharma 35.5p £26m (DEST.L)

The clinical stage biotechnology company focused on the development of novel medicines that can prevent life-threatening infections, announces the commencement of an Investigational New Drug enabling safety study with its novel XF-73 Dermal formulation. This study is the 2nd of 2 planned preclinical safety studies of the XF-73 Dermal formulation and will utilise a suite of preclinical services for interventional agent assessment held by the National Institute of Allergy and Infectious Diseases, part of the US National Institutes of Health. The study is planned to complete in Q2 2023 and should then be ready to move into clinical trials.

DX Group 27p £154.9m (DX..L)

The British mail, courier and logistics company announces the audited results for the year ended 2 July 2022. Revenue was £428m, up 12%, driven by strong performance at DX Freight and improvement at DX Express. Operating margin was 5.8% (2021: 4.3%) and the target remains to be 7.5% -10.0%. Net cash was up 61% to £27m. Q1 2023 trading was in line with management expectations. The 3-year £20-25m investment programme is now in its 2nd year. The Group believes it is well positioned to achieve its growth objectives and targets dividends of 1.5p per share for FY 2023.

James Cropper 875p £83.6m (CRPR.L)

The advanced materials and paper products group announces its half year results to 24 September 2022. Revenues were £61.6m, up 23% year-on-year, driven by customer wins and existing client growth. Adjusted profit before tax was at £nil (excluding one-off impacts of -£0.8), due to energy and raw material price increases. Chairman Mark Cropper commented: “While short term profitability has been impacted, the decisive actions taken combined with the ongoing investments across the Group has strengthened our long term growth prospects and we fully expect to return to profitability in the next six months.”

Kibo Energy* 0.18p £5.5m (KIBO.L)

The renewable energy focused development company, announces that Andreas Lianos has informed the Company that he will be retiring as a Director of the Company with immediate effect, due to personal circumstances. The Company thanks Andreas for his service to the Company over several years and wish him well.

Made Tech Group 28.25p £42.2m (MTEC.L)

The provider of digital, data and technology services to the UK public sector, announces that it has been awarded a new contract with the Home Office, worth c.£10m over a 24-month period with a 6-month extension option worth a further c.£2m. Made Tech won its first 1-year contract with the Home Office in May 2021, worth c.£4m and secured an additional c.£2m for the fulfilment of a 6-month extension option. The contract award announced today represents a renewal and expansion of the initial contract.

Poolbeg Pharma* 9.75p £48.8m (POLB.L)

The clinical stage infectious disease pharmaceutical company with a unique capital light clinical model, announces that ‘EncOVac’, a consortium led by Poolbeg Pharma, has been awarded EUR2.3m in non-dilutive grant funding to progress its Oral Vaccine Platform under the Irish Government’s Disruptive Technologies Innovation Fund. Taking place over 3 years, the collaboration between Poolbeg Pharma, University College Dublin, Trinity College Dublin and AnaBio Technologies will result in the development of an oral vaccine candidate to a Phase I ready state. The resulting technology will serve as a platform for additional oral vaccine candidates for a wide range of pathogens, initially targeting bacterial infections.

Redcentric 117.25p £183.1m (RCN.L)

The IT managed services provider offering cloud and data connectivity solutions to mid-market and enterprise customers, announces a trading update for the six months ended 30 September 2022 (HY23). Revenues was £61.5m, up 39% (HY22: £44.3m) and adjusted EBITDA was £11.7m, down 2% (HY22: £11.9m). Adjusted net debt (excluding supplier loans and lease liabilities) was £39.3m (31 March 2022: £1.5m), mainly due to the initial cash consideration of £23.2m for the acquisitions of 4D Data Centres Limited and certain business and assets from Sungard Availability Services. The Board remains confident in delivering revenue and adjusted EBITDA for FY23 in line with its expectations.

TruFin 60p £56.5m (TRU.L)

The provider of niche lending, technological and service solutions, announces that its subsidiary Oxygen Finance (Oxygen), the early payments programme provider headquartered in Birmingham, has processed more than £1bn in free early payments to small and micro businesses via its FreePay scheme. More than £415m of the £1bn was processed in the first 10 months of 2022. Since launching in 2017 FreePay has enabled Oxygen’s public sector clients to pay more than 400,000 invoices early and for free, improving cashflow and reducing financing costs to over 10,000 suppliers in their local economies.

15 November 2022
*A corporate client of Hybridan LLP

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The information contained in this document is based on materials and sources that are believed to be reliable; however, such information has not been independently verified and therefore it is not possible to confirm such information as being accurate. This document is not intended to be a complete statement or summary of any securities, markets, reports or developments referred to herein. No representation or warranty, either express or implied, is made or accepted by Hybridan LLP, its members, officers, employees, agents or associated undertakings in relation to the accuracy, completeness or reliability of the information contained in this document, nor should it be relied upon as such.

The content of this document includes market commentary and other information which we have prepared in relation to the company referred to in this document, which is our broking client. The provision of this document to you constitutes a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of Regulation 600/2014/EU (MIFID II Regulation).

Any and all opinions expressed are current as of the date appearing on this face of this document only. Any and all opinions expressed are subject to change without notice and Hybridan LLP is under no obligation to update the information contained herein. To the fullest extent permitted by law, none of Hybridan LLP, its members, officers, employees, agents or associated undertakings shall have any liability whatsoever for any direct or indirect or consequential loss or damage (including lost profits) arising in any way from use of all or any part of the information in this document.

This document should not be relied upon as being an independent or impartial view of the subject matter and, for the avoidance of doubt, constitutes non-independent research (as such term is defined in the Financial Conduct Authority’s Conduct of Business Sourcebook to reflect the requirements of the MIFID II Regulation and Directive 2014/65/EU (known as MIFID II)). The individuals who prepared this document may be interested in shares in the company concerned and/or other companies within its sector, may be involved in providing other financial services to the company or companies referenced in this document or to other companies who might be said to be competitors of the company or companies referenced in this document. As a result both Hybridan LLP and the individual members, officers and/or employees who prepared this document may have responsibilities that conflict with the interests of the persons who receive this document. Hybridan LLP and/or connected persons may, from time to time, have positions in, make a market in and/or effect transactions in any investment or related investment mentioned herein and may provide financial services to the issuers of such investments.

In the United Kingdom, this document is directed at and is for distribution only to persons who (i) fall within article 19(5) (persons who have professional experience in matters relating to investments) or article 49(2) (a) to (d) (high net worth companies, unincorporated associations, etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (SI 2005/1529) (as amended) or (ii) persons who are each a professional client or eligible counterparty (as those terms are defined in the Financial Conduct Authority’s Conduct of Business Sourcebook) of Hybridan LLP (all such persons referred to in (i) and (ii) together being referred to as relevant persons). This document must not be acted on or relied up on by persons who are not relevant persons. For the purposes of clarity, this document is not intended for and should not be relied upon by any person who would be classified as a retail client under the Financial Conduct Authority’s Conduct of Business Sourcebook.

Neither this document, nor any copy of part thereof may be distributed in any other jurisdictions where its distribution may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. Distribution of this report in any such other jurisdictions may constitute a violation of territorial and/or extra-territorial securities laws, whether in the United Kingdom, the United States or any other jurisdiction in any part of the world.

Where possible this document is made available to all relevant recipients at the same time. Dissemination of research by Hybridan LLP is monitored to ensure that it is only provided to relevant persons. Research prepared by Hybridan LLP is not intended to be received and/or used by any person who is a retail client.

Hybridan LLP and/or its associated undertakings may from time-to-time provide investment advice or other services to, or solicit such business from, any of the companies referred to in this document. Accordingly, information may be available to Hybridan LLP that is not reflected in this material and Hybridan LLP may have acted upon or used the information prior to or immediately following its publication. In addition, Hybridan LLP, the members, officers and/or employees thereof and/or any connected persons may have an interest in the securities, warrants, futures, options, derivatives or other financial instrument of any of the companies referred to in this document and may from time-to-time add or dispose of such interests.

This document may not be copied, redistributed, resent, forwarded, disclosed or duplicated in any form or by any means, whether in whole or in part other than with the prior written consent of Hybridan LLP.

MIFID II status of Hybridan LLP research
The cost of production of our corporate research is met by retainers from our corporate broking clients. In addition, from time to time we issue further communications as market commentary (such as our daily newsletter, Small Cap Breakfast), which we consider to constitute a minor non-monetary benefit which is capable of enhancing the quality of service provided by Hybridan LLP and which is of a scale and nature which could not be judged to impair the duty of Hybridan LLP to act in the best interest of its client falling within article 24(7)(b) of the MIFID II Regulation.

Hybridan LLP is a limited liability partnership registered in England and Wales, registered number OC325178, and is authorised and regulated by the Financial Conduct Authority and is a member of the London Stock Exchange. Any reference to a partner in relation to Hybridan LLP is to a member of Hybridan LLP or an employee with equivalent standing and qualifications. A list of the members of Hybridan LLP is available for inspection at the registered office, 2 Jardine House, The Harrovian Business Village, Bessborough Road, Harrow, Middlesex HA1 3EX.

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