18 January 2023
*A corporate client of Hybridan LLP
** Arranged by most recent first
*** Alphabetically arranged
Dish of the day
Joiners:
No joiners today.
Leavers:
Dev Clever Holdings PLC (LSE:DEV) has left the Standard Segment of the Main Market.
Made.com Group PLC (LSE:MADE) has left the Premium Segment of the Main Market.
What’s cooking in the IPO kitchen?**
Celsius Resources intends to join AIM. Currently ASX listed, Celsius is a natural resources exploration and development company principally seeking to explore and develop potential world-class copper-gold assets in the Philippines and a cobalt asset in Namibia. Amount planning to raise and anticipated market cap TBC. Expected late January 2023.
Conviction Life Sciences, a newly established closed-ended investment company managed by Plain English Finance Limited, is seeking to list on Premium Segment of the Main Market of the London Stock Exchange, to invest in a conviction portfolio of life sciences and medical technology businesses, primarily in the UK, Europe and Australasia. The Company will invest in both publicly traded and private companies - c. 70% and c. 20% of the total portfolio value respectively. The Company will target an annualised Total NAV Return of 20% over the long-term. Targeting to raise c.£100m. Delayed to 3rd February 2023.
Banquet Buffet***
Alpha Group International (LON: ALPH) £18.10 £763.8m
A high-tech provider of financial solutions dedicated to corporates and institutions operating internationally, announced a trading update for the financial year ended 31 December 2022. Revenues for the full year are expected to increase 27% to approximately £98m (2021: £77.5m), operating profit is to be in-line with expectations and profit before tax (including interest) is expected to be ahead. These results have been achieved alongside increased investment in the people, infrastructure, and technology, in particular within the Alternative Banking Solutions division. The Company is expecting to make additional investments in discretionary initiatives (marketing campaigns), designed to further accelerate growth, without becoming embedded into the cost base.
Crimson Tide (AIM:TIDE) 2.5p £16.4m
The provider of the mpro5 solution, provided the following trading update ahead of publishing its full-year results for the year to 31 December 2022. Revenue for the year exceeded £5.3m, an increase of more than 30% over the prior year's figure of £4.1m. Gross margin remained consistent at approximately 84%. The increased performance at the top line will result in a smaller-than-expected loss at the EBITDA level, despite the deployment of investment capital in marketing and growth. Year-end cash stood over £3.5m and TIDE enters 2023 with a record Annual Recurring Revenue of £5.8m (2021: £3.8m).
Eagle Eye Solutions Group PLC (AIM:EYE) 540p £155.2m
A leading SaaS technology company that creates digital connections enabling personalised, real-time marketing, provided an update on the Group's trading for the six months ended 31 December 2022. Organic revenue growth increased 32%, to £20.0m (H1 FY22: £15.1m), ahead of the Board's expectations. The Group's performance in the Period, its healthy new business pipeline, and the growing international opportunity in the US, Europe, and Asia, coupled with the additional growth opportunity following the acquisition of Untie Nots, underpins the Board's confidence in delivering another year of profitable growth.
Gateley Holdings PLC (AIM:GTLY) 191p £239m
The legal and professional services group, announced its unaudited results for the six months ended 31 October 2022 (H1 23). Strong financial performance with organic revenue growth of 9.8% (H1 22: 22.7%). Adjusted underlying profit margin decreased to 12.6% (H1 22: 13.7%). Ongoing M&A strategy reduces net cash to £1.1m (H1 22: £8.8m) with the acquisition of Symbiosis, a chartered patent attorney firm specialising in IP services for the life sciences industry completed in October 2022. The Group is well-placed to navigate the more challenging economic environment that is beginning to emerge in the second half of the financial year.
Grafenia Plc (AIM:GRA) 7.63p £8.7m
The Company announced that it has acquired the entire issued share capital of Care Management Systems Limited, a provider of care home management software and systems, based in Bristol. The total consideration of £3.5m will be satisfied in cash. The initial consideration comprises cash of £2.975m to be paid on completion, together with deferred consideration of £0.525m to be paid on the first anniversary. The acquisition is expected to be cash flow generative and earnings enhancing in the first year after acquisition.
H&T Group PLC (AIM:HAT) 474p £207.9m
The pawnbroker and retailer of new and pre-owned jewellery and watches, provided an update on trading following completion of its financial year ended 31st December 2022. Trading performance remained strong through the fourth quarter of the year. Pawnbroking pledge book grew to c.£99m at the end of December 2022 (December 2021: £66.9m). Full year retail sales rose over 30% to c.£48m (2021: £36.2m). The Group has continued its programme of capital investment in IT systems and in store estate. At the end of December, the Group had 267 stores (31 December 2021: 257) with a further nine locations in the pipeline, expected to be opened in the first half of 2023. The Board remains confident that full year results will be in line with current market forecasts.
Mercia Asset Management PLC (AIM:MERC) 34.5p £151.8m
The proactive, regionally focused specialist asset manager announced the profitable sale of Intechnica Holdings Limited for a total enterprise value of £14.5m, to US-based Crosslake Technologies LLC. Mercia held a 25.5% direct holding in Intechnica at the date of completion and will receive cash proceeds of £3.7m, generating an internal rate of return (IRR) of 27% and a 1.7x multiple on its current holding value. In addition to the direct investment return, three of Mercia's third-party funds collectively held a further 27.9% providing a blended IRR on investment returns of 32.0% (2.6x on investment cost).
Midwich Group PLC (AIM:MIDW) 546p £485.3m
A specialist audio visual distributor to the trade market, provided a trading update for the year ended 31 December 2022. The Board expects to report record revenue for 2022 of £1.2bn, representing growth of approximately 40% over the prior year (39% at constant currency), with organic growth of over 20%. The gross margin was broadly in line with 2021 levels. Furthermore, the Company anticipates reporting adjusted profit before tax for the 2022 period comfortably ahead of market consensus. In order to support the delivery of its acquisition pipeline, in December 2022 the Group increased its revolving credit facility from £80m to £175m.
Omega Diagnostics Group PLC (AIM:ODX) 3.3p £7.8m
The specialist medical diagnostics company focused on promoting a personalised and functional approach to health and nutrition, provided a trading update. As a result of several headwinds Full year revenues are now expected to be in the range of £7.5-£8.0m for the year ended 31 March 2023 resulting in an EBITDA loss from continuing operations of c. £1.0m. Year-end cash levels are expected to remain c. £ 5.0m. The current order book is £2.5m and further orders are expected, a number of orders will move into FY24. Further to the recent announcement regarding US expansion, the Company confirms it is now pursuing a partnership route into the territory as a first step.
STM Group PLC (AIM:STM) 27.5p £16.3m
The cross-border financial services provider, announced a trading update for the year ended 31 December 2022. The Company expects revenue of £24.1m, EBITDA of not less than £3.2m and Profit Before Tax of not less than £1.7m for the Period. The acquisition of the UK SIPP and SSAS portfolio from Mercer in September 2022 is performing in line with management's expectations, having contributed £1.0m of revenue in the Period, although this is expected to be reported as £0.5m in order to align revenue recognition with STM's more conservative policy. STM reported net cash at 31 December 2022 of £14.0m. The Company's plans to move to an end-to-end, fully automated operating functional model, supported by third party technology
Chef:
Emily Liu
0203 764 2344
emily.liu@hybridan.com
Chef:
Sacha Morris
0203 764 2345
sacha.morris@hybridan.com
Status of this Note and Disclaimer
This document has been issued to you 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).
This document should not be relied upon as being an independent or impartial view of the subject matter. The individuals who prepared this document may be involved in providing other financial services to the company or companies referenced in this document or to other companies who might be said to be competitors of the company or companies referenced in this document. As a result both Hybridan LLP and the individual members, officers and/or employees who prepared this document may have responsibilities that conflict with the interests of the persons who receive this document. Hybridan LLP and/or connected persons may, from time to time, have positions in, make a market in and/or effect transactions in any investment or related investment mentioned herein and may provide financial services to the issuers of such investments.
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.
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.
This document may not be copied, redistributed, resent, forwarded, disclosed or duplicated in any form or by any means, whether in whole or in part other than with the prior written consent of Hybridan LLP.
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.