Small Cap Feast

5th September 2022

Dish of the day
No Joiners today
Off the menu
No leavers today
Dish Of The Day:
Unigel Group (AQSE:UNX) joined the Access Segment of the Aquis Growth Market on 26, August 2022. 
Zamaz plc (ZAMAZ.L) joined the Standard Segment of the Main Market via a direct listing on 2 September 2022.
Off The Menu:
Scottish Investment Trust (SCIN.L) left the Main Market today.

What’s Cooking In The IPO Kitchen?

Aurrigo Group plc, a international provider of transport technology solutions, intends to join AIM. The Group designs, engineers, manufactures and supplies OEM products and autonomous vehicles to the automotive, aviation and transport industries. Capital to be raised and Mkt Cap TBC. Expected Mid-September.

Scythian Mining, a clean gold explorer and developer with operations in Kazakhstan, intends to IPO on the London Stock Exchange in mid-2023, due to successful drilling at Kokkus. Scythian is negotiating an additional funding agreement with a US investor for a further 15,000m of drilling to increase the Kokkus resource with a target of 2-3m oz Au plus a PFS before the IPO.

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.

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 September.

Altona Rare Earths, the AQSE-listed mining exploration company focused on rare earth elements projects in Africa, intends to join the Main Market. The trading of its ordinary shares on the AQSE Growth Market will be cancelled simultaneously and its EPIC will be changed from AQSE:ANR to REE. Conditionally raised £1.1m. Expected late September.


Breakfast Buffet

1Spatial 41p £45.3m (SPA.L)

The Location Master Data Management software and solutions provider has secured a US$1.2m 7-year contract with the State of Arkansas for its Next Generation 911 (NG911) solution, the eighth US State to select the solution. 1Spatial has also been selected by the Eastern Transportation Coalition (ETC), a partnership of 18 US east coast states and Washington DC, as a vendor for conflation solutions within its Traffic Data Marketplace, and has secured its first contract through the marketplace, for US$400k with Massachusetts Department of Transportation. The total potential contract value for conflation within this ETC framework agreement is estimated to be up to US$15m over 8 years.

Alpha FX Group 1,800p £759.5m (AFX.L)

The provider of FX risk management, accounts and payments solutions to corporates and institutions, announces its unaudited interim report for the six months ended 30 June 2022. H1 earnings were in line with expectations. Group H1 revenue grew 35% to £46.1m including £1.4m of recharged interest (H1 2021: £34.2m including £0.2m recharged interest). H1 profit before tax increased 16% to £17.8m (H1 2021: £15.3m). Basic earnings per share increased 21% to 33.3p (H1 2021: 27.6p), with a proposed interim dividend of 3.4p per share (H1 2021: 3.0p). The Board intends to continue investing for growth in H2, and expects to comfortably meet management expectations on revenue and profit for FY22.

AMTE Power 72.5p £25.6m (AMTE.L)

The manufacturer of battery cells for specialist markets, announces that James Hobson, Chief Financial Officer will leave his role at AMTE Power to take up the role of Chief Financial Officer of Clean Power Hydrogen Plc (CPH2). He will leave AMTE no later than the 30 November 2022. The Board will now begin the formal process to appoint a successor.

Avacta Group 118.5p £302.5m (AVCT.L)

The clinical stage oncology drug company and developer of powerful diagnostics, announces that the US Food and Drug Administration (FDA) has granted Orphan Drug Designation (ODD) to the company’s lead pre|CISION drug candidate, AVA6000, for treatment of soft tissue sarcoma. Avacta has an ongoing Phase 1 clinical trial to assess the safety and pharmacokinetics of AVA6000 which has potential as a treatment for patients with a range of cancer types.

Biome Technologies 175p £6.6m (BIOM.L)

The bioplastics and radio frequency technology business, announces that its Bioplastics division has been awarded funding of £244k from the UK Government’s Innovate to support a collaborative development project with ANPOLY Inc of South Korea to improve shelf life performance of food packaging made from Biome’s bioplastics. This project, which will have a total investment of £794k will start in October 2022 and is expected to last 2 years.

Bradda Head Lithium 8.6p £33.4m (BHL.L)

The North America-focused lithium development group, announces that it has received permission to drill 120-holes at Basin East Extension (BEE) in Arizona, which is adjacent to Basin East (BE) where Bradda has a of 305kt Lithium Carbonate Equivalent (LCE) JORC Resource. Drilling of the first phase (20 holes) is expected to commence in September. Bradda is targeting to grow its resources at its Basin project this year with the upcoming drill programmes at BEE and BN. Bradda has 2 royalty payments due from expanding its resources at its clay claims. US$2.5m is paid on Bradda expanding its resource base to 1Mt LCE and US$3m is paid when Bradda expands its resource base to 2.5Mt LCE.

Journeo 116p £10.1m (JNEO.L)

The provider of information systems and technical services to transport operators and local authorities, announces its interim results for the six months ended 30 June 2022 (H1 2022). Revenue grew 23% to £8.9m (H1 2021: £7.2m) and gross profit increased 16% to £3.3m (H1 2021: £2.8m). Underlying profit before depreciation and amortisation was f £0.7m (H1 2021: £0.6m). The Company had a record order intake of £12.9m during H1 2022 and £4m orders have already been received in H2 2022. The Company had deferred £0.5m revenue into H2 2022 due to supply chain issues, however these issues are now easing. Management have a positive outlook for H2 2022 and beyond.

Power Metal Resources 1.5p £22.7m (POW.L)

The exploration company seeking large-scale metal discoveries across its global project portfolio announces the completion of a placing to raise £800k before expenses, through the issue of 57,142,857 new ordinary shares (Financing Shares) at an issue price of 1.4p per share and a further placing to raise £280,000 from a single investor through the issue of 2m shares (Financing Shares) also at an issue price of 1.4p per share, the closing market bid price on 2 September 2022. Each Financing Share has an attaching warrant to subscribe for one new ordinary share at an exercise price of 2.0p with a 12-month term from 19 September 2022. The funds will be used to support the Molopo Farms Complex Project in Botswana, where drilling is scheduled to commence mid-September.

Prospex Energy 6.3p £16.2m (PXEN.L)

The investment company focused on European gas and power projects, announces that it has raised £500k via the issue of unsecured convertible loan notes due at the end of March 2024. The loan notes are convertible, at any time, into new ordinary shares at a price of 5.5p per share, the closing price on 2 September 2022. Interest at 15% is payable quarterly compounded monthly, with the first interest payment to be capitalised and added to the loan principal rather than paid in cash. Loan principal are scheduled to be paid in three tranches, starting in September 2023. These repayment terms mirror those of the £1.87m convertible loan notes issued in July 2022. This financing enables the funding for the development costs to first gas at the Selva field, which is targeted by Q2 2023.

Surface Transforms 48p £92.8m (SCE.L)

The manufacturers of carbon fibre reinforced ceramic automotive brake discs, announces its interims results for the six months ended 30 June 2022. Revenue increased 137% to £2.9m (H1-2021: £1.2m) and gross profit increased 129% to £1.7m (H1-2021: £0.7m). Loss before tax increased to £2.5m (H1-2021: £2.2m) as administrative expenses increased in anticipation of growth in H1 2022. However, series production with OEM 8, Aston Martin Valkyrie and Koenigsegg Jesko began, albeit than planned, with the volume effects of which will be seen in H2-2022. The delay in the OEM 8 series monthly volumes has affected sales guidance to be £1.5m below previous expectations, but the Company remains confident in achieving profitability for the financial year ending 31 December 2022.

5 September 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.

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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.

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
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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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