Small Cap Feast

1st November 2023

Dish of the day
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Dish Of The Day:

IMC Exploration Group re-joined the Standard Segment of the London Stock Exchange today after a reverse takeover.

Round Hill Music Royalty Fund has left AIM.

What’s Cooking In The IPO Kitchen?

Tekcapital announced intention to spin off and IPO on 2 October: MicroSalt, the developer of salt-producing technology designed to deliver full flavor with less sodium, announces the launch of an exempt public offer of shares to retail investors for up to £2.5m via PrimaryBid as part of its spin out from AIM listed Tekcapital plc (TEK.L). Microsalt announced revenues of US$0.638m in 2022, its first year of retail sales of SaltMe Crisp brand and Microsalt salt shakers in US based supermarkets and through Amazon US. AIM Admission delayed, expected mid-November.

Breakfast Buffet

Devolver Digital 25.5p £113.4m (DEVO.L)
The digital publisher and developer of indie video games, announces that it has acquired System Era Softworks, Inc (System Era) for a total consideration of up to US$40m by a combination of cash and shares, of which US$22m is due as initial consideration. Established in 2014, System Era is an award-winning, multi-platform video game developer based in Seattle, United States, currently employing 50 individuals. System Era is the developer behind Astroneer, a space-exploration themed, multiplayer sandbox adventure game. System Era generated revenue of approximately US$7m and EBITDA of approximately US$3.8m, in the year to 30 June 2023.

Eckoh 40p £116.2m (ECK.L)
The provider of Customer Engagement Data Security Solutions, announces a trading update for the six months ended 30 September 2023 (H1 FY24). Revenue is expected to be c.£18.8m (H1 FY23: £19.6m), reflecting the loss of a large UK client disclosed in FY23 final results. Whilst this shift to cloud is tempering revenue growth in the short term, it has a positive impact on recurring revenue, which has increased to 83% (H1 2023: 79%) and operating margins at 21%. Adjusted operating profit (ex-forex) is expected to be c.£4.1m, (H1 FY23: £3.5m). Net cash was £7.3m at the end of H1 FY24, up by £1.6m from £5.7m at year end (H1 2023: £4.4m) and no debt. The Company is on track to met profit expectations for the full year.

Hercules Site Services 25p £15.6m (HERC.L)
The technology enabled labour supply company for the UK infrastructure sector, announces that it has secured a new debt facility with IGF Business Credit Limited (IGF) to fund its continued growth and ongoing working capital needs. This is a three-year invoice discounting debt facility for up to £15m and replaces an existing facility of £11m from a previous provider. This facility is available to all the three key areas of the Company's activities: Labour Supply, Suction Excavator Services and Civil Projects which is experiencing increased demand for its services driven by activity in the UK water treatment sector.

One Heritage Group* 18p £7.0m (OHG.L)
The residential developer, development manager and property manager focused on the North of England, announced yesterday its audited results for the year ended 30 June 2023 (FY23). Revenue increased 792% year-on-year to £15.59m, driven by 71 sale completions during the period. Impairment was £1.09m in the period. Loss before tax of £2.14m (FY 2022: loss of £2.13m), due to rising material prices, sub-contractor prices, delays and the cost of debt of selfdelivered projects. Net debt was £16.94m (FY2022: £14.95m). All self-delivered projects will be completed by the end of the current calendar year. Future delivery will be outsourced on fixed priced construction contracts.

Oxford Metrics 90.5p £118.0m (OMG.L)
The smart sensing software company, servicing life sciences, entertainment and engineering markets, announces it has entered into an agreement to acquire Industrial Vision Systems Ltd (IVS), specialists in developing machine vision software and technology for quality control systems. The consideration of £8.1m is to be funded with existing cash resources and new ordinary Oxford Metrics shares. Based in Oxfordshire, IVS reported unaudited revenues of £3.4m and an EBIT of £0.8m in the year ended 28th February 2023.

Poolbeg Pharma* 6.95p £34.8m (POLB.L)
The clinical-stage biopharmaceutical company targeting diseases with a high unmet medical need, announces that it will host a meeting for investors and analysts on the POLB 001 Oncology Programme on Monday 6 November 2023 at 2:00pm - 3:30pm GMT via the Investor Meet Company platform. Poolbeg's POLB 001 Oncology programme targets the Cytokine Release Syndrome (CRS) associated with many cancer immunotherapy treatments. The meeting will be led by Jeremy Skillington, PhD, Chief Executive Officer, and will feature presentations from a number of key opinion leaders and a patient advocate.

Prospex Energy 6.75p £22.2m (PXEN.L)
The investment company focused on European gas and power projects, provide an operational update for the three months ended 30 September 2023 from the Podere Maiar-1 (PM-1) gas facility of the Selva Field. Po Valley Energy has a 63% working interest of the Selva Malvezzi production concession, while Prospex has the remaining 37% working interest. PM-1 commenced gas production on 4 July 2023. Gross quarterly production from the Selva Malvezzi production concession was 5,658,117 scm (2,093,503 scm net to PXEN) and gross revenue for the quarter was EUR 1.9m (EUR 716.7k net to PXEN).

SysGroup 39.5p £19.3m (SYS.L)
The managed IT services, cybersecurity and cloud hosting provider, provides a trading update for the six months ended 30 September 2023 (H1 FY24). The Group is expecting to report revenue of £10.96m (H1 FY23: £11.32m) and Adjusted EBITDA of £1.56m (H1 FY23: £1.68m). Gross cash was £1.98m at the end of HY FY24s (H1 FY23: £4.22m) following payments to satisfy the Truststream year one earn-out, acquisition of 2,076,394 ordinary SysGroup shares (now held in Treasury) and the settlement of the former CEO's contractual terms. Net debt at the end of 1H FY24 was £3.43m (H1 FY23: £1.92m) and excludes future contingent consideration of £1.84m (H1 FY23: £2.93m)..

Various Eateries 28p £24.9m (VARE.L)
The owner, developer and operator of all day club, restaurant and hotel sites in the UK, announces a trading update (unaudited) for the year ended 1 October 2023. Revenues were £45.5m (2022: £40.7m), slightly higher than market expectations and largely driven by new site openings. Group EBITDA (before AIM costs of £0.6m) is expected to be a loss of c.£1.6m. Cash at bank at 1 October 2023 was £1.9m (2022: £9.4m). Looking ahead to FY24, the Company intends to maintain a measured approach to opening new sites.

Wishbone Gold 2.15p £5.5m (WSBN.L)
The AIM and AQUIS dual listed gold exploration company announces results of the pre collar Reverse Circulation (RC) drilling at its Cottesloe Project, which is considered highly prospective for precious and base metals. This announcement follows on from the 18 September announcement and provides further analysis of the RC drilling referred to therein and is a precursor to the Diamond drilling programme. Preliminarily drilling indicates the relevance of Esso's drill data: 0.25% Copper (Cu), 4.6% Lead (Pb), 0.97% Zinc (Zn) 165 g/t Silver (Ag) and 0.26% Cobalt (Co), as announced by the Company on 27th April 2023.

1 November 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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