Small Cap Feast

20th October 2022

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What’s Cooking In The IPO Kitchen?

Ithaca Energy, a UK independent exploration and production company focused on the UK North Sea, intends to join the Premium Segment of the Main Market. Ithaca Energy is one of the largest independent oil and gas companies in the UKCS, ranking 2nd by resources and 3rd by production. During the six months ended 30 June 2022, Ithaca Energy’s average daily production (oil and gas) on a net working interest basis was c. 66.7 kboe/d, the Group’s revenue was c.$1,338m, Adjusted EBITDAX was c. $907m, profit after tax was c. $1,558m.

BWP REIT, a newly formed single asset company, announces its intention to raise £35m through the issue of 35m ordinary shares 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 (PSX). Expected 27 October 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 globally through the commercial offering of chess related activities. Euro 8m to be raised. Expected November 2022.

OTAQ plc, (OTAQ.L) the technology company with three divisions: Aquaculture, Geotracking Devices and Offshore intends to delist from the Main Market and join the AQSE Growth Market. OTAQ is developing adjacent technologies to take advantage of a number of growth initiatives that will broaden the Group’s current product portfolio in the global marine aquaculture sector and facilitate entry and growth into the geotracking devices sector. Expected 9 November 2022. Raising a total of £3.6m, £2m raised.

Cooks Coffee Company ltd, an international coffee focused café chain which currently owns the Esquires Coffee and Triple Two Coffee Brands, intends to join the AQSE Growth Market. The Company is the 4th largest coffee focused café chain in the UK. Cooks Coffee is currently listed on the New Zealand Stock Exchange. Raising £1.5m through a rights issue in New Zealand and a private placement. Expected 2 November 2022.

Guanajuato Silver Company ltd, a fast growing silver producer in Mexico currently listed on the TSX Venture Exchange, intends to join the AQSE Growth Market. The Company currently owns five precious metals mines and three production facilities. GSilver is primarily focused on reactivating past producing silver and gold mines in the state of Guanajuato. Expected 25 October 2022.

Sondrel Holdings plc, a UK founded and headquartered fabless semiconductor business providing turnkey services in the design and delivery of complex, high end ‘application specific integrated circuits’ (ASICs) and ‘system on chips’ (SoCs) for leading global technology brand, intends to join AIM. Anticipated Mkt Cap £48.1m. £20m to be raised. Expected 31 October 2022.

TECC Capital plc, to be renamed EDX Medical Group, intends to join the AQSE Growth Market. EDX operates a molecular biology and diagnostics laboratory in Cambridge, UK, from which it performs research & development, provides Polymerase Chain Reaction (PCR) testing and genomic sequencing services, undertakes quality assurance and has established expertise in the design, development, validation and sourcing of Lateral Flow Tests on a commercial scale. Due 31 October 2022.

Streaks Gaming plc, a UK-based provider of conversational gaming products intends to join the Standard Segment of the Main Market this autumn. The flotation is expected to value Streaks at approximately £10.2m (pre-money) and will make it the first LSE-listed “pure-play” conversational gaming company. Raising between £5-10m. Delayed but due in October.

Welkin China Private Equity, newly established closed-ended investment company dedicated to investing in unquoted Chinese companies, intends to join the Premium Segment of the Main Market. The Company is targeting a raise of up to US$300m. Due 3 November 2022.

Georgina Energy, focusing on the exploration, development and monetisation of helium, hydrogen and hydrocarbon interests located in Australia intends to join AIM. Georgina Energy has two principal onshore interests: (1) Mount Winter Prospect in the Amadeus Basin in Northern Australia, which the Company has a right to earn an initial 75% interest; (2) Hussar Prospect, 100% owned by the Company, located in the Officer Basin in Western Australia. Expected late October.


Breakfast Buffet

BiON SUSPENDED (BION.L)

BiON confirms that it will not complete a reverse takeover within the six-month period from becoming an AIM Rule 15 cash shell. Accordingly, its ordinary shares will be suspended from trading on AIM with effect from 7.30am on 20 October 2022. From the suspension date, BiON will have six months to complete an acquisition or acquisitions, which constitutes a reverse takeover under AIM Rule 14 otherwise admission to trading on AIM will be cancelled.

Brandshield 7.6p £10.7m (BRSD.L)

The provider of cybersecurity solutions for brand oriented digital risk protection, unveils NFT ShieldTM, a bespoke AI solution aimed at the NFT economy. NFT ShieldTM is the industry’s first cybersecurity product to bring real-time intelligence and enforcement capabilities to combat digital asset fraud across major NFT marketplaces. Features and benefits of the platform include; AI-based threat mapping, comprehensive threat detection and real-time trademark and fake listings enforcement. In conjunction with introducing its new product, BrandShield announces that it has joined the Blockchain Game Alliance.

C4X Discovery 20.15p £50.8m (C4XD.L)

The drug discovery company announces a research collaboration project with Shanghai Stock Exchange listed company HitGen Inc. (SSE: 688222.SH), to identify novel, small molecule hits against an inflammatory target for further C4XD development. This project aims to augment C4XD’s growing pipeline of small molecule inflammatory disease candidates for pre-clinical development and out-licensing to the pharmaceutical industry. HitGen will apply its DEL screening technology platform to identify hits against a commercially valuable target for inflammatory diseases. If successful, C4XD will apply its molecule design Conformetrix technology to translate these hits into suitable starting points for a small molecule programme, which can then be progressed through C4XD’s Drug Discovery process.

Gear4music Holdings 112.5p £23.6m (G4M.L)

The UK based online retailer of musical instruments and equipment, announces a trading update for the six months to 30 September 2022. Total sales grew 2% to £66.3m. (UK Sales fell 3%, while global sales increased 10%). Gross profit is expected to have decreased to £17.4m (FY22 H1: £18.1m). FY23 H1 gross margin is expected to be 26.3% (FY22 H1: 28.0%), reflecting targeted stock reductions. Net debt was £21.8m at 30 September 2022, £2.4m lower than at 31 March 2022. Full-year outlook is in-line with recently updated consensus: revenue of £155.1m, EBITDA of £8.9m and profit before tax of £1.1m.

Greatland Gold 8.25p £412.7m (GGP.L)

The mining development and exploration company focused on precious and base metals, announces it has been awarded a grant from the Western Australian Government to co-fund exploration drilling and mobilisation costs at its 100% owned Ernest Giles project. The grant awarded is the result of a successful application under the Exploration Incentive Scheme. Greatland is eligible to receive a grant up to A$220k (£120k) to co-fund drilling and mobilisation for completion before 30 November 2023.

Intelligent Ultrasound Group 10.75p £29.1m (IUG.L)

The ‘classroom to clinic’ ultrasound company specialising in AI software and simulation, announces that the US Food & Drug Administration (FDA) has granted De Novo clearance for clinical use of its AI medical device, ScanNav Anatomy Peripheral Nerve Block (PNB) in the USA. ScanNav Anatomy PNB uses the latest AI technology to assist qualified healthcare professionals to identify and label anatomy in live ultrasound images in preparation for ultrasound guided regional anaesthesia. The Company intends to launch the system to the US market shortly through its existing in-house sales resources based in Alpharetta, Georgia.

MediaZest* 0.068p £0.9m (MDZ.L)

The audio-visual solutions provider announces a trading update. The business continued to trade well in the second half of the year and MediaZest expects the full year financial results to show a significant improvement on the prior year. Year end cash levels are consistent with the end of the interim period ended 31 March 2022. Demand across key sectors continues to be encouraging with many long-term clients including Pets at Home, Lululemon, Hyundai, Ted Baker and HMV rolling out programs. Looking further ahead, the Board remains vigilant for signs of a slow-down in client activity due to macro-economic uncertainty in the UK and maintains flexibility in its cost base where possible whilst balancing its ambitions for further growth.

Molecular Energies 128p £13.2m (MEN.L)

The international energy company with both hydrocarbon and alternative energy businesses, provides an operational update. Puesto Flores Field, Argentina: The facility has fully restarted after the temporary disruption with all work successfully completed. It is expecting to reach full production levels by the end of this weekend. East Lake Verret Field, Louisiana: After a delay in barge availability, work is in progress at the wells with full production expected by the end of the weekend.

Strategic Minerals 0.3p £6.0m (SML.L)

The mineral producer provides the following update on its cash position and ore sales at the Cobre magnetite operation in New Mexico, USA (Cobre) for the quarter ended 30 September 2022. Annual sales to the end of September 2022 (US$2.475m) were slightly weaker than in the previous year (US$2.85m). However, a July price increases resulted in September quarter revenue to increase to US$0.653m (2021: US$0.607m). Group cash balance was US$0.381m as at 30 September 2022.

Trifast 67.6p £92.0m (TRI.L)

The international specialist in the design, engineering, manufacture, and distribution of high-quality industrial fastenings and Category ‘C’ components, announces a trading update for the half year ended 30 September 2022. Group revenue is ahead of the comparable period c.£120m (H1FY22: £103.7m). The group continued to experience a mixed demand picture across its diversified end market and geographic footprint. Management believes that FY2023 profitability will be weighted towards the second half of the year. The Board expects FY2023 revenue to be slightly ahead of its previous expectations, while underlying profitability will be around 10% below current market consensus.

20 October 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.

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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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