Small Cap Feast

20th December 2022

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What’s Cooking In The IPO Kitchen?

Quetzal Capital, to be renamed Tap Global Group, intends to join the AQSE Growth Market. Tap Global is an innovative and fully integrated provider of crypto settlement and fiat banking. It provides its customers with access to several major crypto exchanges through Tap Global’s app, allowing them to purchase up to 15 crypto assets and store them directly in the customer’s wallet. Tap Global also offers full fiat banking for both B2B and B2C and crypto services to its customers. Expected 9 Jan 2023.

Celsius Resources intends to join AIM. Currently ASX listed, Celsius is a natural resources exploration and development company principally seeking to explore and develop potential world-class copper-gold assets in the Philippines and a cobalt asset in Namibia. Amount planning to raise and anticipated market cap TBC. Expected late December 2022. 

Conviction Life Sciences, a newly established closed-ended investment company managed by Plain English Finance Limited, is seeking to list on Premium Segment of the Main Market of the London Stock Exchange, to invest in a conviction portfolio of life sciences and medical technology businesses, primarily in the UK, Europe and Australasia. The Company will invest in both Publicly Traded and Private companies - c. 70% and c. 20% of the total portfolio value respectively. The Company will target an annualised Total NAV Return of 20% over the long-term. Targeting to raise c.£100m. Date 16 December.

Kistos Holdings intends to join AIM. The Company was incorporated to act as a new holding company for the group companies 0f Kistos plc (KIST), a holding company with the objective of creating value for its investors through the acquisition and management of companies or businesses in the energy sector. Anticipated Market Cap £327m. Expected 22 Dec 2022.


Breakfast Buffet

Aferian 100.5p £85.6m (AFRN.L)

The B2B video streaming solutions company, announces that its 2 4i video streaming platform has supported Israeli Public Broadcaster KAN to bring an exceptional experience to its viewers on multiple Smart TV devices for the World Cup and beyond. 24i's platform has been used to create branded KAN apps for TVs made by LG, Samsung and Hisense as well as Apple TV devices and TVs that use Google's popular Android TV operating system. The apps are integrated with 24i's market-leading management interface, delivered as a SaaS platform. The 24i powered Android TV app, which was the first to go live, has been installed on more than 380,000 devices during the tournament. 

Agronomics 11.15p £109m (ANIC.L)

The listed investor in cellular agriculture, announces its annual results for the year ending 30 June 2022. Net Asset Value per share on 30 June 2022 was 14.85 pence per share, up 18.7% from a year earlier (2021: 12.51 pence per share). The carrying amount of invested assets is £94.81m (2021: £38.77m) - an increase of 145%, and cash and equivalents and cash deposits stood at £51.48m (2021: £62.44m). During the year, the company completed a successful funding round, raising total gross proceeds of £32m. During the period, Agronomics made 15 investments and formed its first 2 companies - cultivated pet food company Good Dog Food, and a contract manufacturer in precision fermentation - Liberation Labs.

Artisanal Spirits 67.5p  £47.1m (ART.L)

The curators of single-cask and limited-edition whisky, and owner of The Scotch Malt Whisky Society, announces that it has extended its agreement with RBS to increase its existing revolving credit facility to £21.5m (previously £18.5m) and extend the term of the commitment until 19 December 2025, broadly representing a 2 year extension of the previous term. Interest under the RBS Facility will accrue at 2.25% over SONIA and this new rate represents a 0.25% reduction in the margin on the facility, and based on the current facility utilisation of £16.5m, this would equate to an annual saving of c.£40k of interest costs for the Group. This new agreement retains the existing "Springing Test" clause, meaning that no covenants are tested while the Group maintains an appropriate stock balance.

Focusrite 840p £497.4m (TUNE.L)

The global music and audio products group supplying hardware and software used by professional and amateur musicians and the entertainment industry, announces the acquisition of Sonnox Limited, a leading designer of audio processing software plug-ins for professional audio engineers. The total cash consideration to be paid for Sonnox is £9.1m, which has approximately £2.1m of cash, and will be funded from existing facilities. Following the acquisition, the enlarged Group will have net debt of approximately £13m. For the year ended 31 March 2022, Sonnox's unaudited revenue was £2.4m with profit before tax of £0.9m, and gross assets of £3m. The Board expects the acquisition to be earnings enhancing in the current financial year, excluding non-underlying transaction costs and amortisation of acquired intangibles.

Hermes Pacific Investments 145p £3.4m (HPAC.L)

The investment company announces it interim results for the six months ended 30 September 2022. During the Period the Company made a loss on ordinary activities before taxation of £44k, a 12% decrease from September 2021 (loss of £50k). HPAC has generated small amount of revenue in the Period through the rental income on its residential property. The Company is also considering possible investment opportunities which would be compatible with its investment strategy. As at 30 September 2022 the Company had net assets of £3,460,000 of which cash was £2,625,000. The Company's financial performance is in line with the Boards expectations.

Tavistock Investments 6.5p £36.1m (TAVI.L)

The Tavistock announces its unaudited interim results for the six months ended 30 September 2022. Revenue increased 16% compared to same period last year and was up 59% compared to same period in 2020 (H1 2022: £17m, H1 2021: £14.7m, H1 2020: £10.7m). The contribution made to the Company's adjusted EBITDA also increased by 56% over the same period last year to £1.4m (30 September 2021: £0.9m). The period remains one of transition for the Company with the Board's focus being on replacing the adjusted EBITDA contribution previously made by the Company's investment management business, Tavistock Wealth Limited (TWL), prior to its sale to Titan Wealth Holdings Limited in August 2021. This will be achieved through an acquisition strategy.  Reported loss from operations has decreased to £470k (H1 21: £1.5m).

Tekcapital 17.25p £26m (TEK.L)

The the UK intellectual property investment group focused on creating valuable products that can improve people's lives, announces that portfolio company, MicroSalt®, has been named the 2022 Sodium Reduction Technology Provider of the Year by Global Health & Pharma. Launched in 2017, Global Health & Pharma conducts extensive research and fact-checking to determine award recipients and the annual award is based on merit, not votes. MicroSalt provides a much-needed salt that enables food manufacturers the opportunity to lower the sodium content of their products without any impact on flavour. Tekcapital owns 97.2% of the share capital of MicroSalt Ltd. and 73% of MicroSalt Inc. its U.S. subsidiary.  

Thor Explorations  16p £95.2m (THX.L)

Thor Explorations announces drill-intersections of significant gold mineralisation from the Makosa gold deposit at its Douta Gold Project, Senegal. The Douta Gold Project encompasses the Makosa gold deposit which currently comprises an Inferred Resource of 730,000 ounces of gold, grading at 1.53 grams per ton (g/t). A comprehensive 26,000 metre exploration program of reverse circulation drilling has been ongoing at Douta during 2022. The results from the final 8,000 metres drilled; Drillhole DTRC596  40m at 1.95g/t Au from 0m; Drillhole DTRC640  26m at 4.66g/t Au from 42m including 10m at 10.29g/t Au; Drillhole DTRC612  32m at 1.45g/t Au from 43m; Drillhole DTRC620  9m at 11.74g/t Au from 58m; Drillhole DTRC626  9m at 4.18g/t Au from 0m; Drillhole DTRC624 16m at 2.20g/t Au from 85m; Drillhole DTRC637  38m at 1.01g/t Au from 42m; Drillhole DTRC641  31m at 1.40g/t Au from 97m; Drillhole DTRC658  37m at 1.18g/t Au from 37m.

Trellus Health 10.5p £17m (TRLS.L)

Trellus Health, which is commercialising a scientifically validated, personalised resilience-driven self-management solution for chronic health conditions provides a trading update. In respect of the financial year ending 31 December 2022, the Company expects to report that it will have generated modest revenue and an EBITDA loss in line with expectations. As at 31 December 2022 the Company's net cash position is expected to total no less than US$18m, slightly better than expected. The Company's cash runway is expected to extend into 2025.

WANdisco 821.5p £550.5m (WAND.L)

The data activation platform, announces that it has signed an agreement worth US$31m with a second tier 1 global telecommunications supplier. Half of the $31m will be paid in advance following the commencement of the project. As this is a Commit-to-Consume agreement, revenue will be recognised in step with the Client's movement of data. The telecommunications sector is a key strategic target market for the Company as it supports a number of industry verticals with their own Internet of Things use cases. In this case, the Client is one of the largest global service suppliers of Internet of Things applications. Initial use cases are expected to include smart meter, automotive, manufacturing and natural gas related data.

20 December 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).

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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.

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