Hybridan Small Cap Feast

16 mins. to read
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.

Joiners: MADE, a digitally native lifestyle brand in home has joined the Premium 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.  AT 200p offer price Mkt cap is c. £775m. Total offer size £193.8m of which £100m is new money.

Leavers: No Leavers Today.

Banquet Buffet

CAP-XX 8.3p  £37.9m (CPX.L)

The leading manufacturer of ultra-thin prismatic and cylindrical supercapacitors, announced that Sensys Networks, developer of an advanced in-roadway Wireless Vehicle Detection System, has selected the CAP-XX DMT470  supercap for its FlexMag Flush and Deep Sensor IoT devices. Sensys Networks chose the CAP-XX prismatic supercapacitors for their low ESR (Equivalent Series Resistance) which enables the high burst of power needed for the device’s data transmissions, and for their thin form factor which fits easily inside the small (L x H x W) 7.4cm x 7.4cm x 5.6cm wireless in-pavement or below bridge installed sensors.

Cora Gold 8.3p  £20.4m (CORA.L)

The West African focused gold company, announced the fifth set of drill results, and first from Zone A, from its largest ever drilling campaign, which commenced in March 2021 at its Sanankoro Gold Project in Southern Mali. The Company plans to have drilled up to a total 35,000m by end of July 2021, with a dual focus on targeting resource growth as well as infill drilling to convert existing Inferred resources to Indicated. New drill results at Zone A confirm good widths and grade in oxide ore,  29m @ 3.23 g/t Au from 66m in hole SC0365 , 32m @ 1.63 g/t Au from 32m in hole SC0366,  14m @ 2.70 g/t Au from 63m and 12m @ 1.57 from 46m in hole SC0362, 24m @ 1.64 g/t Au from 17m in hole SC0364,  4m @ 8.51 g/t Au from 40m in hole SC0368.  174 holes drilled totalling over 18,340m from start of the campaign to the 14 June 2021. All three rigs are currently drilling at Selin in Phase 2 (‘P2’) drill programme targeting deeper holes to deepen existing shallow, average 65m depth, pit shells. Targeted completion of up to 35,000m drilling is due in July 2021.

Crimson Tide 3.5p  £23m (TIDE.L)

The provider of mpro5, announces the appointment of Mark Self as President & CEO, mpro5 North America. In line with the Company’s stated strategy, he will be responsible for building a partnership base to take mpro5 to the North American market, working on some nascent business opportunities already identified. The Company has established mpro5 Inc as its US subsidiary. Mark spent his early career leveraging his go to market skills growing technology businesses of all sizes with sales leadership, industry solution strategy and execution, partner support and recruitment experience earned at IBM, Motorola Solutions and NCR. Since then, Mark has spent his time focused on scaling early-stage companies located in Raleigh, North Carolina. Mark serves on the board of the Council on Entrepreneurial Development and served on the first executive committee at Triangle Angel Partners.

FireAngel Safety 8.7p  £22.5m (FA.L)

AGM Statement from the supplier of home safety products. “The Company made a good start to 2021 and trading has continued to be on track as the UK eases out of the COVID-19 lockdown restrictions. I am pleased to say that we anticipate that our first half performance to 30 June 2021 will be in line with the Board’s expectations. There are however ongoing reverberations from the COVID-19 pandemic still being felt, with some of our markets not yet fully open, alongside global component shortages and occasional international shipping disruptions. So far, we have dealt with the challenges and absorbed consequent extra costs without harming the Group’s overall performance. However, we expect these challenges to continue through the current year and we are working continually to address and mitigate wherever possible. Despite the aforementioned challenges, demand for our products and services continues. I would once again like to take this opportunity to thank our shareholders for their support in the fundraising announced by the Company at the end of April. It has provided the Company with the necessary funds to deliver its strategic goals and lays the foundation for a return to profitability and positive cash generation. FireAngel’s compelling proposition to protect and save lives with innovative, cutting-edge home safety technology remains strong and the Group is well positioned for future growth.”

Jangada Mines 8.7p  £22.5m (JAN.L)

Updated National Instrument 43-101 (‘NI 43-101’) compliant Mineral Resource Estimate (‘MRE’) for the Pitombeiras North and South targets at its 100%-owned Pitombeiras Vanadium Project, Ceará State, Brazil. 221% increase in Measured and Indicated Resources (‘M&I’) based on two of eight identified targets. M&I Resources of 5.10Mt at 0.46% V2O5, 9.04% TiO2 and 46.06% of Fe2O3. Inferred Resource of 2.33Mt at 0.41% V2O5, 8.26% TiO2 and 43.18% of Fe2O3. Exploration potential remains open along strike and at depth. Jangada has established a target to potentially delineate 10Mt of total mineral resources. Drilling programme at Goela target started in late April 2021 and expected to be concluded by end of June 2021. Updated Preliminary Economic Assessment (‘PEA’) to be completed following the delivery of the updated mineral resources for both Pitombeiras’ and Goela, which will include new metallurgical tests.

Kibo Energy* 0.22p  £5.44m (KIBO.L)

The multi-asset, Africa & UK focused energy company, announced that, following an extensive review of the Company’s operations, the Company’s primary focus going forward will be on renewable energy opportunities.  In line with its refocused strategy centred on sustainable renewable energy solutions and following the positive results of an extensive due diligence process regarding the agreement with South Africa-based Industrial Green Solutions (Pty) Ltd (IGES), the Company will now proceed to conclude the transaction to jointly develop a portfolio of Waste to Energy projects in South Africa (see RNS dated 18 May 2021).  In addition, the Company intends to appoint specialist advisors to assist the Company in developing and implementing an appropriate disposal strategy to dispose of its coal assets or possibly repositioning these assets to make use of alternative fuel sources other than coal, given latest rapid advances in developing alternative fuel sources in this domain. It will be the objective of this disposal strategy to ensure that maximum value is realised from these projects, in which significant value was created over several years.

NetScientific 113.5p  £17m (NSCI.L)

The international life sciences and sustainability technology investment and commercialisation Group, announces that its portfolio company PDS Biotechnology Corporation (Nasdaq: PDSB) yesterday announced an issue of c.5.3m new shares of common stock to raise gross proceeds of c.USD45m. NetScientific currently owns 1,278,000 shares of PDS’ common stock, representing 5.7% of its fully diluted share capital prior to the issue. The Board of NetScientific believes that PDS has made excellent progress since its last fund raising and has therefore agreed to subscribe US$510k (c. £363k) for 60,000 shares of common stock in the New Issue, which would result in its interest in PDS amounting to c. 4.86 per cent. on a fully diluted basis upon completion of the New Issue.

Sareum Holdings* 8.75p  £289m (SAR.L)

Yesterday  the specialist drug development company, announced that it had raised £1.47m, before expenses, through a subscription for 30,000,000 new ordinary shares of 0.025p each in the capital of the Company  at a price of 4.9p per share. This subscription is by the same high net worth individual who subscribed to shares to the value of £900k as announced by the Company on 1 June 2021. Under the terms of the Subscription, the Subscriber will also be issued one five-year warrant, exercisable at the Subscription Price, for every three Subscription Shares issued which can only be exercised following the Company’s closing middle market share price being above 7p per Ordinary Share for five consecutive days. The Subscription Price was set at the closing ask price on Friday 11 June but represents a discount of approximately 14 per cent. to the closing middle market price for Sareum Shares on 14 June 2021. The net proceeds from the Subscription will be used to progress the Company’s SDC-1801 and SDC-1802 TYK2/JAK1 inhibitor drug development programmes as well as for working capital purposes. As noted in the Company’s Trading Update of 25 May 2021, the Company is targeting the completion of preclinical studies for SDC-1801 in Q3 2021, subject to successful progress. Clinical trial plans, including priority autoimmune indications and potential Covid-19 application, will also be developed in parallel, subject to additional funding being raised. The UKRI-funded Covid-19 research project for SDC-1801 continues on schedule with the experimental phases finishing by the end of June and the data analysis to complete shortly thereafter. The Company will provide a further update once the relevant data are available.

Time Finance  29.25p  £27.1m (TIME.L)

Trading and strategic update from the  independent specialist finance provider. The financial year to 31 May 2021 was profitable for the Group with it continuing to demonstrate the resilience and diversification of its lending book, further strengthening its balance sheet and improving liquidity. Board restructured and strengthened with the appointments of Ed Rimmer and Tanya Raynes as CEO and Non-Executive Director respectively. Revenue for the year expected to be approximately £24.1m (FY20: £29.2m) of which approximately 85% is from lending activities and 15% from broking activities (FY20: 80% and 20% respectively). Profit Before Tax, Exceptional Items and Share-Based Payments (“PBTE”) for the year expected to be approximately £3.0m (FY20: £3.0m). Strategy involves the adding of significant scale with the clear goal for Time Finance of becoming a leading alternative multi-product independent SME funder, helping UK businesses to recover and grow post-Covid. In doing so, the Group’s principal strategic objectives include to: More than double the Group’s gross lending book organically from its current level to approximately £250m by 31 May 2025. Over the same timeframe achieve organic-led growth to be in excess of the Group’s 2019 pre-Covid levels of over £30m Revenue and £8m of PBTE.

Zephyr Energy 4.9p  £60m (ZPHR.L)

Operations update from  the Rocky Mountain oil and gas company focused on responsible resource development and carbon-neutral operations. Williston Basin update. The S-Bar wells have been placed into production, also ahead of forecast schedule, and the Feehan wells are expected to be placed into production within the next month. Zephyr will update Shareholders  on production rates in the coming weeks, once the wells have cleaned up and reached peak initial rate.  Paradox project. Preparations continue ahead of the drilling of the State 16-2LN CC lateral appraisal well (the “lateral”) which is scheduled to spud in July and which will target the Company’s first production from the Paradox project. Final permitting is expected shortly and vendor negotiations (including the rig contract) are expected to be finalised in the coming weeks. The additional evaluation work related to the overlying reservoirs continues to progress, and it is the Company’s intention to update the market by the end of the month once final analysis has been received from our third party partners and consultants.

What’s cooking in the IPO kitchen?

Wise, the Fintech and payments start-up is planning to pull the trigger on a direct listing on the London Stock Exchange as soon as this week, becoming the latest tech firm and this time a Unicorn to cash in on the ongoing boom in flotations on the UK’s public markets. This will be entirely a vendor placing with no new shares to be issued, according to press reports.

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. Expected June/ early July.

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 on the Premium Segment of the LSE. The Offer will comprise an offering of both new Shares to be issued by the Company, with gross proceeds expected to total approximately EUR 120m and existing Shares to be sold by ANTLER Equity Co S.à r.l and certain BCG shareholders. The directors intend to use the net proceeds from the Primary Raise for the repayment of existing debt in conjunction with the refinancing of the Senior Facilities Agreement targeting a net debt at IPO of approximately 2.75x FY21 Adjusted EBITDA. Expected early July.

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 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 on the Premium Segment of the Main Market. 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.

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.

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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