Small Cap Feast

23th January 2023

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What’s Cooking In The IPO Kitchen?

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 January 2023.

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. Delayed to 3rd February 2023.


Breakfast Buffet

AudioBoom Group 397.5p £64.8m (BOOM.L)
The leading global podcast company provided a trading update for the 12 months ended 31 December 2022. The Group records revenue of approximately $75.5m, up 25% on 2021 ($60.3m), annual adjusted EBITDA profit of approximately $3.6m, up 16% on 2021 ($3.1m) and the Group holds cash of $8.1m up from $3.0m in 2021. Within the podcast industry, the Group’s revenue growth again outpaced their competitors, they are now the fourth largest publisher in the US. The group is focused to restructure the sales division, ensuring competitiveness in the podcast industry and have secured over $44m in advance advertising bookings for 2023.

Colefax Group 670p £48.5m (CFX.L)
The Group is an international designer and distributor of furnishing fabrics & wallpapers provided half year results ending 31 October 2022. The Group’s sales were up 12% to £51.66m (2021: £46.12m) and up 2.5% on a constant currency basis. The Group further confirmed profit before tax up 16% to £5.2m (2021: 4.49m) and earnings per share increased by 30% to 51.3p (2021: 39.6p) helped by share buybacks in the prior year. The Group grew its cash generation to £2.9m excluding share buybacks and dividend payments and has a strong balance sheet to continue to invest in their distribution network and portfolio of brands. The Chairman expects the full year performance to be ahead of previous expectations.

Everyman Media Group 90p £82.1m (EMAN.L)
A leading independent cinema group in the UK announced an end of year trading update of period ended 29 December 2022. The Group announced revenues of £79.7m, an increase of 62.5% (2021: £49.0m) and EBITDA values at £14.5m, an increase of 74.7% (2021: £8.3m) and ahead of market expectations. Two new venues were opened in the year: Edinburgh and Egham. The Group now operates 38 venues with 130 screens (2021: 36 venues 119 screens). The Group remains committed to organic expansion and is opening a new venue in Durham in February 2023, with four further venues expected to open during the year.

GETECH Group 15.625p £10.5m (GTC.L)
The company which locates energy and minerals for the energy transition announced an update on trading for the year ended 31 December 2022. The Group expects revenue growth to £5.0m (FY2021: £4.3m) with a 66%/23% split between transitional petroleum and critical minerals respectively, ahead of market expectations. This growth expanded Getech's orderbook by 39%, to £4.6m, a record year-end position (FY2021: £3.3m), and the Group finished 2022 with a cash position of £4.3m (FY2021: £5.9m). Getech continued to invest in green hydrogen assets in 2022 specifically in the regions of Shoreham Port and Inverness. The Group is growing their order book and the Board is confident in the outlook for the business.

Kinovo 33.5p £20.8m (KINO.L)
The specialist property services Group that delivers compliance and sustainability solutions announced that it has been awarded a contract worth £4m over 2 years by the London Borough of Waltham Forest. The contract, comprises of electrical, commercial, mechanical works and associated builders works, contains possible extensions of two further one-year terms. As announced on 28 November 2022, Kinovo reported a 25% increase in revenue for H1 FY22, with three-year visible revenues of £146m, which this contract win adds too.

Leeds Group 13p £3.6m (LDSG.L)
The UK’s textile processing company provided interim results for six months ended 30 November 2022. The Group's turnover in the first six months of the financial year is in line with last year at £15.57m (2021: £15.59m): The Group made a reduced loss before tax of £224k (2021: loss of £487k). Hemmers, a German trading subsidiary for the Group announced their turnover increased to £12.67m (2021: £12.66m) and the company made a loss of £164k (2021: loss of £192k). Trading is currently in line with the forecasts and the cost cutting measures taken last year are providing a good platform on which to rebuild a profitable business.

Science in Sport 13.5p £23.3m (SIS.L)
The premium performance nutrition company serving elite athletes, sports enthusiasts, and the active lifestyle community, announced the appointment of Henry Turcan as Non-Executive Director with effect from 1 February 2023. Henry has worked in financial services since 1996, with a focus on equity capital markets. Having spent most of his career advising growth companies within investment banking, he is currently holding a directorship at Internet Fusion Group Ltd and HAJT limited.

Surgical Innovations Group 1.75p £16.3m (SUN.L)
The designer, manufacturer and distributor of innovative technology for minimally invasive surgery, provided a trading update for the year ended 31 December 2022. Revenues for the year are expected to be 24% higher at £11.3m, (2021: £9.1m) and 6% ahead of the pre-pandemic reference year (2019: £10.7m). The Group also expects to report underlying gross margin that remains within the target range of 40% to 45% despite inflationary cost pressures owing focus on efficiency savings and by passing on price increases into revenue. The Group expects to report adjusted EBITDA of approximately £0.7m in line with market expectations.

Touchstar 82.5p £7m (TST.L)
The group supplying mobile data, computing solutions and managed services to a variety of industrial sectors announced a trading update for the year ended 31 December 2022 (FY22). The board anticipates revenue growth of 10% to £6.7m (FY22: £6.1m) and profit before tax up 100% to £414k (FY22: 207k). Cash balance is reported £3.5m (FY22:£2.5m). Full year outcome is expected to be in line with market expectations, revenue and profit before tax levels, ahead of market expectations in terms of EBITDA, and significantly ahead in terms of net cash generation. The Group is advancing investment in long-term organic growth of the business specifically through increased sales and innovation of their products and solutions, expanding in new territories and entering into new vertical sectors through adaptation.

Urban Logistics 140p £660.8m (SHED.L)
The last mile logistics focused REIT announced five new acquisitions for a total consideration of £48m at a net initial yield of 6.0%. In addition, the Company has completed two new lettings, generating additional rental income of £0.2m, and two lease restructurings. Urban Logistics has also reached practical completion on five units of its forward funded developments adding 239,235 sq ft to the portfolio. Three of the five units are under offer, one was pre-let and marketing is ongoing for the final unit. The Company has also been reviewed by MSCI's ESG team, and has received a rating of A (up from CCC).

23 January 2023
*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.

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