Hybridan Small Cap Feast

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Hybridan Small Cap Feast

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Edenville Energy 12.0p  £2.6m (EDL.L)

The mineral exploration and development company announce that it has signed an agreement with Brahma Energies Limited for production and sales of a minimum of 4,000 tonnes of washed coal per month at Edenville’s Rukwa Coal Project in Tanzania. The net target sales price for Rukwa coal delivered at the gate is currently estimated to be between $35-$50 per washed tonne. The revenue share arrangements give Edenville $10 per tonne of washed coal sold at the minimum price of $35 per tonne, plus 60% of any sales revenue above $35 per tonne of washed coal (profit share). 

 Harland & Wolff Group  11.3p  £18.3m (HARL.L)

The company focused on strategic infrastructure projects and physical asset lifecycle management, provides a trading update for the year ended 31 December 2022 (FY22) and aspirations for FY23/FY24. With three material contracts secured (Cory phase 1 at £8.5m; Cory phase 2 at £9.6m and the M55 Regeneration Programme at £55m), management remains comfortable with the guidance of revenues between £65m and £75m for FY22. Given the contracted revenues, the stability of the cruise & ferry and ship repair markets and confidence around potential orders within the defence and renewables markets, management has an aspiration of generating revenues of between £100m and £115m for FY23 and between £200m and £230m for FY24.

NetScientific plc 66.0p  £15.4m (NSCI.L)

The life sciences and sustainability technology investment and commercialisation company, announces the completion of its acquisition of a 30% stake in Vortex. With the core technology in the capture and isolation of high quality Circulating Tumour Cells (CTCs) from blood samples, Vortex is focused on developing its position in the dollar oncology liquid biopsy market. Additionally, Vortex has recently appointed Paul Jones as its new Chief Executive Officer

Norman Broadbent  5.1p  £3.1m (NBB.L)

The executive search and interim management firm announces its unaudited interim results for the six months ended 30 June 2022 (H1 2022). Revenue was up 28% to £3.96m (H1 2021: £3.10m) and EBITDA grew 817% to £55k (H1 2021:£6k). With net fee incomes (NFI) up 20% over H1 2021 and new hires, the company is carrying a positive momentum into H2 2022. CEO Kevin Davidson indicates that the business is now in to deliver sustainable and accelerated growth in both NFI and EBITDA in H2 2022 and beyond.

OKYO Pharma 2.4p  £33.3m (OKYO.L)

The preclinical biopharmaceutical company announce its audited results for the year ended 31 March 2022: net loss of £4m (2021 restated: £2.6m) and cash balance at £2m (31 March 2021: £5m). The cash balance as at 1 August 2022 is approximately £1.5m, with current liabilities of £1m. Management projects that without additional financing facilities it will run out of cash in October 2022. To meet the short-term liquidity needs, the company has secured a $2m short-term credit facility with a related party in order to bridge any delays in the occurrence of the anticipated clinical milestones for the OK-101 program for dry eye disease. 

Smartspace Software 42.0p  £12.2m (SMRT.L)

The provider of Integrated Space Management Software for smart buildings and commercial spaces, announces a trading update for the six month period ending 31 July 2022: revenues expected to be approximately £3.6m, up 46% year on year and a net cash position of £2.0m (30 April 2022: £1.9m). The Board expects to deliver revenue and profitability results in-line with current market expectations for the full yearwhilst ARR is expected to be lower than market expectations reflecting the updated ARR calculation methodology and performance to date.

Sopheon 550p  £58.4m (SPE.L)

The international provider of software and services announces a five-year, $11.2m contract with Team Submarine, a grouping of submarine programs within the Naval Sea Systems Command (NAVSEA), the largest of the U.S. Navy’s six system commands. NAVSEA will use Sopheon’s flagship solution Accolade® to modernise numerous processes related to the engineering of and training for new submarines. This five-year arrangement will help to underpin Sopheon’s financial goals for current and future years.

Spectra Systems 135p £61.2m (SPSC.L)

The supplier of machine-readable high speed banknote authentication, brand protection technologies and gaming security software, announces that it yesterday received an order for a Banknote Disinfection System (BDS) to be installed at an Asian central bank. Spectra’s BDS units are capable of disinfecting banknotes of varying volumes in one hour, even when strapped or in sealed bags, and range in price from $150k to $800k. Whilst this first sale is not expected to materially impact its performance this year, the company believes that it will open the door to additional sales as central bank processing staff continue to struggle with pathogens such as Sars-2 and now monkeypox. 

TMT Investments* US$4.13  US$129.9 (TMT.L)

The venture capital company investing in high-growth technology companies, announces its unaudited interim results for the half-year ended 30 June 2022. NAV per share was US$6.68, down 25.8% from US$9.00 as of 31 December 2021, primarily due to the share price drop of NASDAQ-traded cloud storage company Backblaze and the significant reduction in the values of Bolt’s publicly traded peers, namely Uber and Lyft. With no financial debt and cash reserves of approximately US$13m at 15 August 2022, TMT believes it is well positioned to ride out the current market volatility and able to make selective investments when the right opportunities present themselves. Management expects a number of positive revaluations across its portfolio by the end of 2022.

Tribal Group  81.5p  £171.7m (TRB.L)

The provider of software and services to the international education market, announces its interim results for the six months ended 30 June 2022. Revenue was up 7.7% to £42.4m. However, EBITDA declined 21.6% to £7.1m mainly due to increased costs associated with the implementation phase of the NTU (Nanyang Technological University) contract. With an expanding customer base, advanced service offering and continued contract and ARR momentum, the Board remains confident in delivering results for 2022 in line with its current expectations. However, margin recovery in 2H22 is dependent on the progress with the NTU contract.

What’s cooking in the IPO kitchen?

Unigel Group, intends to join the Aquis Growth Market.  Unigel Group is a pioneer in the field of thixotropic gels for the fibre optic cable industry. The Company is also a supplier of laminated steel tapes to the fibre optic cable industry in the US. Thixotropic gels and laminated steel tapes are essential components to the rapidly growing global fibre optic cable market. The Group exports to over 40 countries and is a key supplier to almost every leading fibre optic cable manufacturer worldwide and is the industry’s only organisation with multiple manufacturing facilities spread across 3 continents. The Company acts as the holding company for its wholly-owned operating subsidiary, Unitape Limited and its 60% owned operating subsidiary, Unigel (UK) Limited. Delayed, timing TBC.

Georgina Energy, an early-stage resource company with a strategy of actively pursuing the exploration, commercial development and monetisation of helium, hydrogen and hydrocarbon interests located in the Amadeus and Officer Basins in Northern and Western Australia intends to join AIM. Georgina Energy has two principal onshore interests. The first, the Mount Winter Prospect is located in the Amadeus Basin in Northern Australia, which the Company has a right to earn an initial 75% interest. The second interest, the Hussar Prospect is 100% owned by the Company and is located in the Officer Basin in Western Australia. Expected late September.

Mise en Place**

The latest UK employment figures were a mixed bag today with the unemployment rate rising slightly to 3.8% during the second quarter but the number of payrolled employees increasing significantly in a number of regions. Following these statistics, the focus is shifting towards tomorrow’s publication of July inflation figures. Spread betting and CFD trading platform CMC Market’s Chief Market Analyst Michael Hewson commented that:

“While this is welcome news, it is not having the desired effect on wages that it might be, although we did see a modest rise in weekly earnings from 4.2% to 4.3% for the same period. This is expected to see an increase to 4.5% for the three months to June.

Where we are seeing some strength is in the data which includes bonuses, where employers appear to be leaning towards making one-off bonus payments to employees in an attempt to mitigate the effects of the cost of living squeeze that way. This way is less inflationary as it doesn’t feed into a permanent wage price spiral and works on the premise that energy prices are likely to come back down again, thus easing the squeeze in the cost of living, over the longer term.”

*A corporate client of Hybridan LLP

** Content not provided by Hybridan LLP

This document has been prepared by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectives, financial situation or needs of any specific entity and is not a personal recommendation to anyone. Recipients should make their own investment decisions based upon their own financial objectives and financial resources and, if any doubt, should seek advice from an investment advisor. The information contained in this document is based on materials and sources that are believed to be reliable; however, they have not been independently verified and are not guaranteed 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, directors, officers, employees, agents or associated undertakings in relation to the accuracy, completeness or reliability of the information in this document nor should it be relied upon as such. Any and all opinions expressed are current opinions as of the date appearing on 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, directors, 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 is sent to you as market commentary only. As market commentary this document does not constitute any of (i) investment research and financial analysis or other forms of general recommendation relating to transactions in financial instruments for the purposes of the UK retained version of section B of annex I to Directive 2014/65/EU (“MIFID II Directive”); or (ii) investment research as defined in the UK retained version of article 36(1) of Commission Delegated Regulation 2017/565/EU made pursuant to the MIFID II Directive; or (iii) non-independent research (as such term is defined in the Financial Conduct Authority’s Conduct of Business Sourcebook).

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