Hybridan Small Cap Feast

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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.

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Banquet Buffet

Argentex Group 124p  £140m (AGFX.L)

The provider of foreign exchange services to institutions, corporates and high net worth private individuals, announces the resignation of Carl Jani who has stepped down from his role as Co-CEO today. The current Co-CEO, Harry Adams, will now assume the role as the Group’s sole CEO, effective immediately. Lord Digby Jones, Chairman, commented: “On behalf of the Board, I’d like to thank Carl for his significant contribution to Argentex. He has overseen the Group’s growth story with Harry from its very beginning, culminating in the successful IPO in 2019 and the leading position it commands in the FX market today. Harry will take sole responsibility of an established management team which has the depth of experience needed to fulfil the Group’s growth potential and I am confident they will continue to deliver long-term value for employees, clients and shareholders alike.”

Frontier Developments 2332.5p  £918m (FDEV.L)

The developer and publisher of videogames based in Cambridge, UK, announces Jurassic World Evolution 2, the much-anticipated sequel to the highly successful Jurassic World Evolution (2018), and provides an update on trading following the end of Frontier’s financial year 2021 (to 31 May 2021). Announced on 10 June 2021 at Summer Game Fest, an industry-wide celebration of video games, Jurassic World Evolution 2 builds on the major success of Jurassic World Evolution, Frontier’s biggest selling game to date, which released in June 2018. Jurassic World Evolution 2 is the major global licensed IP title which was previously unrevealed on Frontier’s future roadmap. This much-anticipated sequel will release later in calendar 2021 (in FY22).Continued strong performance across the whole game portfolio delivered record annual revenue for FY21 – provisional unaudited FY21 revenue is approximately £91m. Elite Dangerous: Odyssey, our major expansion for the iconic space game Elite Dangerous (2014), released on PC on 19 May 2021. Coronavirus-related de­velopment challenges continue to be well managed. However, for prudent planning reasons the Board now antici­pate that our F1 2022 management game may release in early FY23 (after 1 June 2022) as opposed to late FY22 (before 31 May 2022). Based on the anticipated ongoing performance of the existing portfolio, com­bined with an exciting release schedule for FY22 including Jurassic World Evolution 2, the Board’s project­ed revenue range for FY22 is £130m to £150m, which prudently assumes THE 2022 F1 management game is released in early FY23. For FY23 the Board’s projected revenue range is £160m to £180m, based on the anticipated per­formance of their current and future game franchises, together with a growing contribution from their games label for third-party publishing, Frontier Foundry.

Osirium Technologies 25.5p  £7.34m (OSI.L)

The vendor of cloud-based cybersecurity software, today announces its final results for the 12 months ended 31 December 2020. Total recognised revenue increased by 22% to £1.43m (2019: £1.17m). Total bookings decreased 14% to £1.57m (2019: £1.82m). The Group achieved record first and fourth quarters, however the Coronavirus pandemic delayed customer buying decisions, particularly impacting bookings in the second and third quarter. Deferred revenue increased by 10% to £1.50m (2019: £1.37m), providing enhanced visibility of future earnings. Reduced operating loss of £2.88m (2019: £3.40m), in line with management expectations. Cash balances at 31 December 2020 of £1.48m (31 December 2019: £3.85m) reflecting continued investment for long-term growth. “Moving through 2021, we are seeing continued momentum with a record Q1 and a healthy pipeline of opportunities through our direct and indirect sales channels. While we remain vigilant to the ongoing economic uncertainty and risks to our end markets, we are encour­aged by the gradual normalisation of trading conditions.”

Plutus PowerGen SUSPENDED (PPG.L)

Plutus PowerGen plc, an AIM Rule 15 cash shell, announced a non-binding Heads of Agreement HOA with MBU Capital Group Limited  as a result of which, subject to, amongst other matters, the execution of a sale and purchase agreement, Plutus would acquire the membership interests of Ben’s Creek Carbon LLC. Ben’s Creek is a 10,000 acre site located in the Central Appalachian Basin, West Virginia, USA. The Ben’s Creek mine has historically produced metallurgical coal, of which it has commercial quanti­ty reserves. Ben’s Creek has deep well mines which are operationally ready and the Target has direct access to domestic markets through the Norfolk Southern rail network and to export markets through the Lambert’s Point Export Terminal in Norfolk, Virginia. Ben’s Creek has a long history of supplying Hi-Vol B+ metallurgical coal to US and international customers.

Rogue Baron 6.875p  £5.93m (AQSE.SHNJ)

The Company in the premium spirit sector announced the appointment of Jon Smith OBE as a Non-Executive Di­rector of the Company with immediate effect. Jon Smith (sometimes known as Jonathan Andrew Smith) founded the business carried on by First Artist Corporation in 1986 and has overseen the remodelling of the company since its flotation in 2001 as a football agency to its recent current status as a multi-functional, multi-national entertainment, financial, event and sporting group. He presided over the recent major equity pur­chase by Pivot Entertainment LLC, New York. He previously owned a successful record production company, which was largely credited, amongst other things, to have been the prime creator of Northern soul in the UK pop market during the 1970’s. He sold this company to a US conglomerate in 1981 followed by the equally successful sale of his real estate company. He is responsible for staging many of Britain’s biggest sporting events, including the UK visits of major US sporting bodies, being NFL American Football, NBA Basketball and NHL Ice Hockey. Jon was also Chief Executive of The London Monarchs during their inaugural World Bowl winning season at Wembley.  He is one of the recognised spokespersons for the UK sports industry and has raised over £50m in various forms for sport in the UK over the last few years.  Jon is one of only a handful of individuals holding a football agency licence who is also licenced to stage global events under the auspices of FIFA world­wide.

Powerhouse Energy 5.6p  £219.6m (PHE.L)

The UK technology company commercialising hydrogen production from waste plastic, announced the engineering con­sultancy, SWECO, has been appointed to prepare concept design and an Environmental Impact Assessment report for the waste-to-hydrogen project in Konin, Poland. Hydrogen Utopia International Ltd., through its Polish subsidiary Hydropolis United sp. z o.o, signed an agreement with SWECO on June 9th 2021.  This appointment follows the non-binding Heads of Terms which Powerhouse Energy Group plc, signed with HUI in November last year for the applica­tion of its technology in Poland.

Sigma Capital 201p  £180m (SGM.L)

The boards of Six Bidco Ltd and Sigma Capital Group plc have reached agreement on the terms and conditions of a recommended cash offer by Bidco for the entire issued and to be issued share capital of Sigma .Under the terms of the Acquisition, each Sigma Shareholder will be entitled to receive: for each Sigma Share  202.1 pence in cash. The price per Sigma Share under the terms of the Cash Offer represents a premium of ap­proximately 35.6 per cent to the closing price of 149.0 pence per Sigma Share on 10 June 2021 (being the Last Practicable Date); Sigma Capital is a private rented sector, residential development and urban regeneration specialist.

Universe Group 5.1p  £13.3m (UNG.L)

The developer and supplier of retail management solutions, payment and loyalty systems, announced a three year exten­sion of an existing contract with a major UK based supermarket involving the provision of forecourt pay­ment capabilities (as previously referred to in the Group’s final results). This material contract extension pro­vides further visibility for the Group over future revenues. As previously indicated, the Group had prepared for its fulfilment by acquiring inventory in anticipation which will now unwind as the contract is implemented. The contract is in addition to the recent five-year extension of an existing contract with a major international oil and gas group (announced in April) and provides a positive outlook for the Group as COVID-19 restrictions look to ease further in the coming weeks. The Group has continued to trade in line with the Board’s expectations for the year to date. The new Chief Executive, Neil Radley and the new Chief Financial Officer, Adrian Wilding both joined the Group on 1 May 2021. Ivan Brooks steps down from his interim position on 1 July 2021 and the Company thanks Ivan for helping ensure a smooth management transition. Ivan continues to be a non-executive director of the Company.

Van Elle Holdings 46.5p  £48m (VANL.L)

The UK’s largest ground engineering contractor, today provides a trading update for the year ended 30 April 2021  ahead of announcing its final results, which are expected to be released on Tuesday 17 August 2021.Trading during the final quarter of the Period continued to improve alongside the easing of Covid restrictions, with strong performances in March and April, and exit rate revenues at the end of the financial year returned to pre-pandemic levels. The Board is encouraged that this increased level of activity has continued into the new financial year, albeit remaining mindful of industry-wide supply chain pressures which are, in some instances, impacting material costs and availability. Revenue for the Period, subject to completion of the audit review, is now expected to be c.£85m (2020: £84.4m) and the Board expects the adjusted loss before tax to be slightly ahead of consensus forecasts.

Warpaint London 160.5p  £123.2m (W7L.L)

AGM Statement from  the specialist supplier of colour cosmetics and  owner of the W7 and Technic brands .”Trading in the year to date has been encouraging and we are particularly pleased with the performance in the UK where sales of our brands for the first five months of the year are up 64% compared to the same period in 2020 and up 18% compared to the same period in 2019, one not impacted by the Covid-19 pandemic. The growth in W7 UK sales has been assisted by our roll out into Tesco.  In June 2020 the Group’s W7 products were in 56 Tesco stores, today they are in over 1,300 across the various store formats, with a further expansion of the W7 full cosmetic displays in Tesco planned for later this year.  The Group’s other brands are also performing well in the UK. We are also seeing encourag­ing growth elsewhere.  In the US, for example, we have recently completed a trial launch of W7 products in 50 Francesca’s stores where sales have exceeded expectations and we anticipate rolling out product across a significant portion of their 444 store estate later this year. E-commerce sales of W7 products across all markets for the first five months of the year were ap­proximately three times the level in the same period in 2020 and we anticipate further significant growth, albeit from a mod­est base.”

What’s cooking in the IPO kitchen?

Orcadian Energy, the North Sea focused, oil and gas development company, announces its intention to seek admission to AIM. The Company’s key asset is the 100% interest in the Pilot oilfield, with audited proven and probable reserves of 78.8m barrels (audited by Sproule BV). Orcadian plans to raise gross proceeds of c. £5m to progress its assets.

Itim Group Limited (to be renamed itim Group plc) is a software technology company, established in 1993. Itim adds value by helping multi-channel retailers optimise their business and stores to improve financial performance and compete more effectively in the digital world of modern retailing. The Company provides flexible solutions proven at adding value as retailers transform stores, digital capabilities and operations suitable for modern retailing and profit improvement. The company plans to raise up to £15m on Admission on AIM (through a placing of new and existing equity). Due date late June / early July.

Spectral MD Holdings, Ltd., a predictive analytics group that develops proprietary AI algorithms and optical technology for faster treatment decisions in wound care, announces its intention to IPO onto AIM. Net proceeds from the IPO will be used to provide capital for the development of DFU technology which will include investment in additional clinical studies supporting the indication along with progressing regulatory filings; build a European presence and implement the Group’s sales strategy to sell the Group’s DeepView® product into various targeted European jurisdiction; build US distribution network and provide working capital. Due late June.

Baltic Classifieds Group PLC, the leading online classifieds group in the Baltics, announced their intention to IPO and the intended publication of a registration document. Should BCG proceed with the IPO, the Company will apply for admission of its entire issued Ordinary Share Capital to the Premium Listing Segment of the LSE.

The UK Residential REIT, a proposed closed-ended real estate investment trust established to invest in a diversified portfolio of affordable, privately rented residential real estate assets in attractive locations outside of London, announces its intention to IPO onto the Premium Listing Segment of the LSE. URES is targeting Gross Issue Proceeds of  150m before expenses by means of a placing, offer for subscription and intermediaries offer of 150m Ordinary Shares plus an Issue of up to 50m Consideration Shares in connection with the acquisition of Seed Assets at an issue price of £1.00 per Ordinary Share. Expected market capitalisation following the completion of the acquisition of Seed Assets of £200m. Due 16 July

Nord Gold plc, the internationally diversified pure-play gold producer, announces the intended publication of a registration document and its potential intention to undertake an IPO. Should Nord Gold proceed with the Offer, the Group will apply for admission of its Shares to the Premium Listing Segment. The Company has also applied for admission of the Shares to trading on the Moscow Exchange.

Victorian Plumbing Group Limited the UK’s leading online retailer of bathroom products and accessories, announces its intention to seek admission of its ordinary shares to trading on AIM. Group has grown rapidly in recent years and is now the UK’s leading online specialist bathroom brand by revenue in 2020 and the second largest retailer of bathroom products in the UK with an estimated 14.2% of the bathroom market by revenue in 2020. The Company’s growth trajectory was maintained in the current financial year, delivering results of £140.7m revenue, and £20.1m adjusted EBITDA for the six months ended 31 March 2021.

LionTrust ESG Trust PLC announces the publication of the Prospectus in connection with the IPO on the Premium Segment of the Main Market. The Company is targeting an initial issue of £150m by means of an Initial Placing, Offer for Subscription and Intermediaries Offer of Ordinary Shares at an issue price of 100 pence per Ordinary Share. In addition, pursuant to the Prospectus, a placing programme will allow the Company to issue up to an additional  250m Ordinary Shares and/or C shares, in the 12 months from the date of publication of the Prospectus and following Initial Admission.

UK SPAC (formerly Mountfield Group and now an AIM Rule 15 Shell) has applied for admission to the AQSE Growth Market. The Company recently raised £3.1m in a placing, giving the Company flexibility in pursuing a reverse take-over transaction. The Directors of the Company are currently in the process of identifying and assessing reverse takeover opportunities with a particular focus on the European medicinal cannabis sector. The Directors are working closely with specialists in this industry in order to evaluate opportunities. Due 11th June.

MADE, a digitally native lifestyle brand in home has announced its intention to IPO onto the Premium Listing Segment of the LSE. MADE’s mission is to make high-end designer furniture and homeware products accessible to everyone.  Their gross sales, net revenue and Adjusted EBITDA were £109.5m, £82.4m and £1.8m, respectively, for the three months ended 31 March 2021 and £315m, £247m and (£5.1m), respectively, for the year ended 31 December 2020.  The Offer would comprise a primary offer to raise proceeds to further develop growth in existing markets, improve service through reduction of lead-times offered to customers, scale its homeware range and give the Group increased working capital flexibility. MADE would seek to raise approximately £100m of primary proceeds. Expected June.

Voyager Life, the health and wellness company established to supply high-quality Cannabidiol (CBD) and hemp seed oil products, announces the Company’s intention to seek admission to trading on the Access Segment AQSE Growth Market. Admission is expected to occur before the end of June 2021. Voyager was incorporated in November 2020 as a health and wellness business focused on CBD and hemp seed oil products. The Company’s directors believe that a significant opportunity exists in the CBD market due to the forecast growth and ongoing regulatory changes.

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.” Due 22 June.

*A corporate client of Hybridan LLP

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