Hybridan Small Cap Feast

A round up of the day’s news brought to you by the team at small-cap broker and advisor Hybridan.

Dish of the day

Emmerson EML.L has moved from the Standard List to AIM. The Company’s current market capitalisation is approximately £46m, based upon its share price at close of business on 24 March 2021 of 6 pence per Ordinary Share. Raising £5.5m on admission. Emmerson is a potash development company focused on the development of the Khemisset Potash Project located in Northern Morocco, approximately 90km from the capital city, Rabat, and the planned bulk port of Kenitra Atlantique and 175km from the port of Mohammedia. The Project has a JORC Resource Estimate (2019) of 537Mt @ 9.24% K2O and exploration potential with a development pathway targeting a low capital expenditure and high margin potash mine.

Off the menu

No leavers today.

Banquet Buffet

Crossword Cybersecurity* 342p £19.7m (CCS.L)

The technology commercialisation company focused on cyber security and risk management announced its final results for the year ended 31 December 2020. Proposed 10 for 1 subdivision of ordinary shares subject to shareholder approval. Delivered 25% revenue growth to £1.6m, despite the toughest economy in recent memory. Revenues from product and consulting expanded by 39%. Consulting 2020 recurring revenue 2.5 times 2019 recurring revenue. Equity fund raise £1.0m in April 2020. Loss of £2.3m and £1.0m closing cash. Outlook: Expects rate of growth in revenue to more than double in 2021. Rapid roll out of Rizikon Pro, on the back of partnerships and membership deals. Growth organically and by acquisition. Expect to add one additional product to cyber security product portfolio, through acquisition in the short term. Progressing plans to establish an overseas subsidiary in Oman and anticipate starting to roll out products and services in the region in H2 2021. Actively exploring the possibility of acquiring a cyber security consulting company, to bring in additional clients and capability. Growing client interest in Nixer and Nixer functionality being used to enhance Rizikon.

Jade Road Investments* 22.5p £25.9m (JADE.L)

The London quoted pan-Asian diversified investment vehicle focused on providing shareholders with attractive, uncorrelated risk-adjusted long-term returns, shared that one of its portfolio companies, Meize Energy Holding Limited, was recently featured in a news story on ChannelNewsAsia, a leading English language news agency based in Singapore. The Managing Partner of Harmony Capital, Suresh Withana, was also interviewed during this segment. Meize Energy designs and manufactures wind turbine blades and has three factories in China, located in Inner Mongolia, Ningxia Province, and Jiangsu Province. The Jiangsu facility is one of the three manufacturing bases for Meize Energy. It is the newest, having manufactured blades for the first time in September 2020, and the largest in terms of production capability. It produces 24 sets of blades each month and is looking to double its production by the middle of the year.

Asiamet Resources 2.45p £47.5m (ARS.L)

Appointment of Andrew Neale as General Manager for the KSK Project and update on the various workstreams underway on the BKM copper development project located in Central Kalimantan,Indonesia. Andrew Neale, a highly experienced metallurgist with extensive experience in studies, mine design, construction and operations. He has worked on numerous copper and gold projects in Indonesia and globally with Freeport McMoran, Merdeka Copper Gold and Bumi Resources. Andrew is based in Jakarta and will manage all aspects of the pre-development technical works and permitting required to prepare the BKM project for construction and operations. A number of pre-development workstreams are underway or commencing shortly as part of the on-going value enhancement works including: Updating capital and operating cost estimates for the 2019 BKM feasibility study in preparation for debt financing discussions and a review of all opportunities to reduce the life-of-mine power costs (estimated to be 20% of overall costs). Discussions have been initiated with: potential suppliers of natural gas to the project site, designers and constructers of gas pipelines, and suppliers of modular on-site gas-turbine power plants. Discussions have also been initiated with third parties interested in financing the supply of power as a stand-alone project, separate from the mining and processing operations.

Reabold Resources 0.68p £57.5m (RBD.L)

The investor in upstream oil and gas projects, has conditionally offered to acquire additional Corallian Energy Limited shares from existing Corallian shareholders, in exchange for Reabold shares, at a ratio of 474 Reabold shares for 1 Corallian share, potentially increasing Reabold’s shareholding in Corallian to a maximum of 49.99%. Share offer to acquire up to 13.12% of Corallian Energy shares at a ratio of 474 Reabold shares per Corallian share. The Offer could significantly increase Reabold’s position in the low-risk, high potential Victory Gas Discovery up to 49.99%. Draft Field Development Plan anticipated to be submitted by year end. Planned 3 year gas production plateau from Victory, at a rate of 70 mmscf/d (11,666 boepd) from Q4 2024, delivering over 25 BCF of gas per year. Victory is located near existing infrastructure and in particular the Total-operated Greater Laggan Area.

Synectics 142.5p £25.4m (SNX.L)

A specialist in the design, integration and support of advanced security and surveillance systems, provides an update ahead of its Annual General Meeting, which is being held later this morning. As reported last month with the release of the Company’s audited final results for the year ended 30 November 2020, trading in the new financial year so far has, as expected, carried on at similar levels to the last financial year. This reflects primarily the continued impact of global travel restrictions on casinos and gaming resorts in Asia-Pacific and the United States, which represent Synectics’ largest market sector for its security and surveillance systems. Activity in public infrastructure and transportation in the UK and Europe continues to hold up relatively well. Looking forward, there are some early signs of increased customer activity in the gaming sector, from which the Board expects some recovery in orders in the second half of this financial year. The Group’s cash position remains solid, with net cash of £4.5m at 23 April 2021 (26 February 2021: £4.5m).

Empire Metals 2.55p £8.4m (EEE.L)

The exploration and resource development company confirmed that the next phase of works at the Company’s Eclipse Gold Project, located 55km north-east of Kalgoorlie, Western Australia, as announced on 17 March 2021, has commenced. The fully funded drill programme is focussed on two main objectives: Firstly, resource drilling at Eclipse Mine target – 200m of diamond drilling in three holes to duplicate selected recent reverse circulation drillholes for resource estimation purposes, to enable initial geotechnical core logging as input to a preliminary pit design, and to provide samples for metallurgical testing. Secondly, expansion drilling at new Jack’s Dream discovery – 1,700m of RC drilling in 17 holes, mainly focussed on infill drilling adjacent to wide intersections of mineralisation and high-grade intercepts around the Jack’s Dream workings, north-west of the Eclipse shaft, to further expand the mineralisation and potential resources. An initial non-compliant resource has been prepared for the Eclipse shaft area. 92,913 Tonnes at 2.25 g/t.

4basebio UK Societas 375p £46.2m (4BB.L)

The specialist life sciences group focused on exploiting intellectual property in the field of gene therapies and DNA vaccines has signed a research collaboration and evaluation license agreements with Royal Holloway University of London (RHUL). Under the terms of the agreements, the parties will collaborate to develop a HermesTM based non-viral vector incorporating a patented full length dystrophin gene with the view to developing a novel therapy for treatment of Duchenne muscular dystrophy (DMD). 

Water Intelligence 877.5p £136m (WATR.L)

The multinational provider of precision, minimally-invasive leak detection and remediation solutions for both potable and non-potable water provided its unaudited Q1 Trading Update. During Q1 the Group grew revenue strongly by 38% to $11.4m (Q1 2020: $8.3m) and statutory profits before tax by an outstanding 152% to $1.66m (Q1 2020: $0.66m). Profits before tax adjusted for share-based payments and amortisation grew an equally outstanding 115% to $1.78m (Q1 2020: $0.83m).

Immotion Group 6.2p £25.8m (IMMO.L)

The UK-based immersive entertainment group announced that with effect from 1 May 2021, the Las Vegas Strip, home to Immotion Group’s flagship VR Theatre installation, ‘Undersea Explorer’ at Shark Reef Aquarium (Mandalay Bay Resort and Casino), will be allowed to expand all attractions from 50% to 80% capacity per the local Clark County Commissioner. In addition, the Nevada State Governor has declared his intention to open the entire State of Nevada back to 100% capacity on 1 June 2021. This will be the first time that Immotion’s 36-seat ‘Undersea Explorer’ Virtual Theatre has had the opportunity to raise its capacity beyond the 50% level since its opening in August 2020, so the potential increase in revenue from 1 May 2021 and through the summer months could be material.

Vast Resources 0.1p £21.3m (VAST.L)

The mining company announced that the decline project to Level 19 is progressing on schedule and the Company has commenced mining fresh higher grade ore at its Baita Plai Polymetallic Mine ‘Baita Plai’ in Romania, in accordance with the revised mechanised mine plan as announced on 30th March 2021.

What’s cooking in the IPO kitchen?

Alphawave IP Group is considering an IPO on the standard listing segment of the London Stock Exchange. Alphawave IP is a leading semiconductor IP company focusing on the hardest-to-solve connectivity challenges created by the exponential growth of data. Funds and accounts managed by BlackRock, and Janus Henderson, have each entered into cornerstone agreements with the Company to subscribe for, subject to certain conditions, in aggregate, c. USD 510m of Offer Shares at an offer price representing an equity value of up to USD 4.5b for the Group at Admission. During the year ended 31 December 2020, the Group generated revenue of USD 32.8m, exhibiting robust growth and delivering a CAGR of 161 per cent. since the year ended 31 May 2018.

Watchstone Group plc (LON:WTG) intends to apply for admission of its Ordinary Shares to trading on the Access segment of the AQSE Growth Market operated by the Aquis Stock Exchange (AQSE). It is expected trading will commence on 30 April 2021.

Catena Group (CTNA.L) to complete reverse takeover and be renamed Insig AI and is acquiring the remaining shares of  Insight Capital Partners. Insight, which is based in the UK, is a data science and machine learning solutions company that provides bespoke web-based applications, advanced analytical tools and modern technology infrastructure to make machine learning accessible to investment professionals. Insight has developed five products specifically aimed at accelerating an asset manager’s data science and machine learning strategy. Capital to be raised on Admission approximately £6.1m. Mkt cap c. £66.4m. Due 10 May.

Dispersion Holdings PLC, an investor in the high growth FinTech sector within the UK, the USA and Canada, has announced its intention to IPO on the Access Segment of the Aquis Stock Exchange Growth Market. The Board intends to deploy the majority of the Company’s cash resources in the acquisition of minority interests in a number of different, yet to be identified, companies in the broad FinTech sector, and to apply expertise to the business operations and strategic plans of these companies. Target Admission Date of 30 April.

Darktrace plc. Intends to float on the main market of the London Stock Exchange (premium). Darktrace was founded in 2013 with a mission to fundamentally transform the ability of organisations to defend their most critical assets in the face of rising cyber threats. Darktrace is a world-leading provider of AI for the enterprise, with the first at-scale in-the-enterprise deployment of AI in cyber security. Due early May.

Wickes to demerge from Travis Perkins and list on the Main Market. Expected 28 April.

Thor Explorations (TSXV:THX) seeking a secondary listing on AIM. The Company is targeting Admission during Q2 21. Segun Lawson, President & CEO, stated: “Thor Explorations has advanced significantly, in both project development and capitalisation since the acquisition of Segilola in 2016. This year, the Company is well positioned to achieve two major milestones with the commencement of gold production at Segilola in Nigeria and a maiden resource at Douta in Senegal, as well as continuing to progress our highly prospective Nigerian exploration portfolio on the Ilesha Schist belt.”

Imperial X (AQSE:IMPP) to join the Main Market (standard). It is also proposed that on Admission to the Official List, the Company will change its name to Cloudbreak Discovery Plc.  With effect from Admission, Imperial X will hold equity positions and royalties in a variety of projects in the natural resources sector across multiple jurisdictions, primarily in the Americas and Africa. The Company is proposing to raise up to £1.5m by way of placing of new Ordinary Shares to support further prospect acquisitions. Current Mkt cap £4.7m. Expected April.

*A corporate client of Hybridan LLP

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