Small Cap Lunch
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AIM:
Total number of AIM Companies (Incl Susp):
953*
Total number of AIM Companies trading:
904*
*as at close of business 9 March 2018
Standard List** of Main Market:
Total number of Standard List Companies
(Incl Susp):
136*
Total number of Standard List Companies trading:
123*
*as at close of business 9 March 2018
NEX Growth Market:
Total number of NEX Growth Market Companies (Incl Susp):
89*
Total number of NEX Growth Market Companies trading:
82*
*as at close of business 9 March 2018
*A corporate client of Hybridan LLP
** Standard Listing as defined by Hybridan LLP to be a business with strictly operational activity
Dish of the day
Augmentum Fintech (LON:AUGM) - Company focused strategy to invest in fast growing and/or high potential private fintech companies in the UK and wider Europe joined the Premium Segment of the Main Market raising £94m at 100p
Off the menu
No Leavers Today
What’s cooking in the IPO kitchen?
AIM
SimplyBiz, a Financial Services Firm, reported to be considering an IPO targeting a market capitalisation of between £140m and £155m in a listing that would raise £30m of new money.
Bacanora Lithium—Readmission. No new money. Mkt cap £140m. Due 21 March. the new holding company for Bacanora Minerals Ltd
Core Industrial REIT—established to invest in Irish-based industrial properties, predominantly located in the Greater Dublin Area. Vendor placing and new funds to a total of €225m, Target gross proceeds €207m. Expected Mid March
Polarean - Medical drug-device combination company operating in the high resolution medical imaging market. Offer TBC. Due 26 March
Block Energy—a NEX Listed UK based oil exploration and production company whose main country of operation is the Republic of Georgia, looks to join AIM end of February 2018. Offer TBC
Main Market Specialist Funds
Life Settlement—closed-ended investment company whose principal activities will be to support and manage portfolios of whole and partial interests in life settlement policies issued by life insurance companies operating predominantly in the US. Due 6 Mar.
Main Market Premium Listing
Broker and investment platform operator AJ Bell reported to be considering London float with a valuation at £500m.
JTC—Conditionally raised £243.8m at 290p. Due 14 Mar. Mkt Cap £310m. Includes £218m vendor sale. 2017 revenue £59.8m. Underlying EBITDA £14.8m. Provider of administration services to fund, corporate and private clients.
Helios Towers—Sub-Saharan telecommunications tower operator. FYDec17A revenue of $345.m and Adjusted EBITDA of $146m. Expected to join FTSE 250. Due early April. JSE Secondary listing.
Energean Oil & Gas—Seeking gross proceeds of c.$500m. Independent oil and gas exploration and production company focused on exploration, development and production of assets in the Eastern Mediterranean . Due march 2018.
Amigo Loans—Sub prime lender reported to be preparing for an IPO targeting a £500m valuation.
Eaton Towers– press reports African mobile telco mast specialist is seeking a £1.5bn London listing
Lunch buffet
Sareum Holdings* (LON:SAR) 0.82p £23.15m
Sareum, the specialist cancer drug discovery and development business, announced its H1 results for the six months ended 31 Dec 2017.
Sareum's licence partner Sierra Oncology made strong progress with the two clinical studies of Chk1 inhibitor SRA737 leading to a significant expansion of the development programme in 2018.
Sareum's TYK2 inhibitor autoimmune disease and cancer research programmes advanced with distinct small molecules moving into candidate selection for preclinical development in each therapeutic area.
The Company's small molecule Aurora+FLT3 candidate, targeting opportunities in haematological cancers, continues in preclinical development.
In Nov, Sareum raised £0.7m through a placement of 100,000,000 new ordinary shares at 0.7p per share to progress its drug development programmes as well as for working capital purposes.
Loss on ordinary activities (after taxation) of £0.72m (2016: profit of £0.57m).
Cash at bank as at 31 Dec 2017 was £2.16m (2016: £2.3m).
In Feb 2018, Sierra provided an update on the SRA737 clinical development programme.
The Dose Escalation Phase 1 portion of the Phase 1/2 monotherapy trial is in the final stages of optimising the SRA737 dose regimen and the Cohort Expansion Phase 2 portion is ongoing. The Phase 2 portion has been expanded to include more patients across six cancer indications and at a larger number of clinical sites in the UK.
Surgical Innovations (LON:SUN) 3.62p £31.02m
Surgical Innovations, the designer, manufacturer and distributor of innovative medical technology for minimally invasive surgery, reported strong financial results for the year ended 31 Dec 2017. The integration of Elemental Healthcare Limited, acquired on 1 Aug 2017, is now completed.
Financial Highlights:
* Revenues up by 44% to £8.75m (2016: £6.09m)
* Gross margin improvement to 42.5% (2016: 33.8%)
* Adjusted PBT of £1.10m (2017 reported: £0.54m, 2016: £0.28m)
* Adjusted EPS of 0.19 pence (2017 reported: 0.10 pence, 2016: 0.15 pence)
* Closing net debt of £0.73m (2016: net cash of £0.72m)
Operational Highlights:
* Transformational acquisition of Elemental Healthcare completed on 1 August 2017 for £9.4m
* Expanded board with new commercial leadership
* Integration programme now fully implemented
* Overseas distribution relationships strengthened
* Managed transition to new UK Notified Body
* UK distribution agreements extended and supplemented by new lines
Post Period Highlights:
* Elemental Healthcare signed three year distribution agreement with Bariatric Solutions GmbH
* Elemental Healthcare signed an additional three year exclusive UK distribution agreement with Microline Surgical Inc, Boston USA. Expected to generate revenue of an estimated £7m
Burford Capital (LON:BUR) 1,110p £2,282.29m
Burford Capital, a global finance and investment management firm focused on law, announced that it has entered into a definitive agreement to sell its entire entitlement in the Teinver matter for $107m in cash. Burford's investment in the Teinver matter is $12.8m. Thus, the sale represents an investment gain of $94.2m and a return on invested capital of 736%.
The Teinver matter represents an investment in an arbitration matter arising out of the expropriation of two Argentine airlines by Argentina's government. In July 2017, the arbitration tribunal rendered an award in favour of the claimants; that award entitled Burford to receive more than $100 million under its funding agreement. For further background to the Teinver matter, please refer to our RNS dated 24 July 2017 and our interim report for the six months ended 30 June 2017.
Burford continues to pioneer development of the secondary market in litigation investments and regards the sale of this investment as prudent, locking in its gain on the investment and accelerating its cash recovery to enable reinvestment of that capital.
While Burford does not release individual investment carrying values, we can say that the Teinver investment is carried well below the sale price, and thus we expect to show a realized gain from this transaction in our interim results for the six months ended 30 June 2018, to be published in July 2018.
OPG Ventures (LON:OPG) 18.35p £61.87m
Trading update for Q3 FY18 from the developer and operator of power generation plants in India.
* 1.3 billion units in Q3 FY18, up 23% on prior year - highest ever quarterly generation
* Nine months FY18 production 3.7 billion units, up 9% on the corresponding period
* Q3 FY18 Plant Load Factor ("PLF") at Chennai was 80% and at Gujarat was 84% - highest ever combined average
* 22 MW solar commissioned; 40 MW in pre-commissioning
* Strong cash collections from TANGEDCO - 86% of old receivables cleared, and
* Gujarat - No Cross Subsidy withheld from our tariff by the DISCOMs in February 2018 for the first time
The Company expects generation to remain strong and cash flows from operating activities to remain resilient. As previously identified, while FY18 is expected to be a transitional year for the Company, as a result of the Company's operational performance, anticipated revision in tariffs and addition of 62 MW of new solar capacity in Karnataka plus progress at Gujarat, the Board remains positive about the Company's prospects for FY19.
Telit Communications (LON:TCM) 161.5p £219.65m
Telit Communications, an enabler of the Internet of Things (IoT), has agreed a series of new and amended financial covenants with its lead financing bank and published an update on financial results for 2017 as well as for the first two months of 2018.
The new covenants are more appropriate for the Group following its rationalisation of product lines and costs. In particular, the covenant, which in broad terms measured the ratio of free cash flow against debt service obligations, is replaced for 2018.
The Group has resolved to adopt a conservative approach in the preparation of its results, and in particular with respect to the capitalisation of R&D expenditure.
This, combined with establishing a prudent level of provisions and other adjustments with its auditors and some component shortage issues which affected sales in the closing weeks of 2017, leads the Board to now expect to report revenue of approximately $374-376m and adjusted EBITDA in the region of $20-23m. The Group's net debt position as at 31 Dec 2017 was $30.2m (2016: $17.7m).
Trading over the first two months of 2018 has been considerably stronger than the comparable period in 2017 and ahead of the Board's early expectations.
Atlantis Resources (LON:ARL) 35.25p £44.4m
Atlantis provided the following update on the transformational deal announced on 14 Dec 2017 whereby Atlantis will join forces with SIMEC Energy, a part of the GFG Alliance. The transaction is intended to create a listed platform which would own and operate a global portfolio of renewable generation assets.
The Company and its advisers have been making good progress on the acquisition of the Uskmouth power station in Wales, which is classed as a reverse takeover under the AIM Rules for Companies and Atlantis now expects to announce the finalised terms of the transaction and hold an EGM in Q2 2018 to allow shareholders to vote on the proposed transaction which, if approved, would see the Company recommence trading as SIMEC Atlantis Energy shortly thereafter.
Following completion of the front end engineering design in H2 2018 and appropriate project based funding being secured, in relation to which discussions with project based debt and equity providers are on-going, the Uskmouth power station, which was previously coal-fired, will be converted to burn energy pellets, derived from non-recyclable waste products which would otherwise have been sent to landfill. The station will have an initial generation capacity of 220MW, with the option to convert a third unit in future, which would bring its capacity to 330MW.
Altus Strategies (LON:ALS) 7.88p £11.71m
Altus Strategies, the Africa focused exploration project generator, announced the definition of a new 2.3km long gold prospect within its 100% owned Sebessounkoto Sud Licence in western Mali, West Africa. The Licence targets shear hosted gold in Birimian age metasediments.
Highlights:
* Exploration defines a 2.3km long gold prospect at Soa in western Mali
* Historic channel sample results of 0.68 g/t Au over 61.4m reported from weathered saprolite
* Numerous hard rock workings with the largest being 150m long with shafts up to 40m deep
* Sampling of mining waste has returned grades of 5.18 g/t, 3.98g/t & 2.4g/t Au
* Previous sampling by Legend Gold included 18.5g/ t & 12g/t Au from outcrop
* The Soa prospect is parallel to a strong 6.3km long geophysical feature
* Follow up exploration programme now planned
genedrive (LON:GDR) 36p £6.54m
genedrive, the near patient molecular diagnostics company, announced that is has commenced commercial sales and shipments of its Genedrive® HCV ID Kit and Genedrive® platform into the EMEA region. The products have been shipped to genedrive's distributor, Sysmex Corporation, a world leader in clinical laboratory systemization and solutions, and are now destined for use in various initial target countries. In addition, first commercial sales and shipments of the Genedrive® HCV ID Kit and Genedrive® platform are expected to commence in the Asia Pacific region in the coming weeks.
"Since signing our distribution agreements with Sysmex, we have continued to build momentum in the market and we are pleased to see initial commercial sales. An ongoing process of registering the products in target countries will naturally lead to a growing opportunity, and we are confident that as the first to market decentralised qualitative molecular HCV test, Genedrive® is uniquely positioned to meet this need."
Primorus Investments (LON:PRIM) 0.14p £3.22m
Primorus Investments announced it has, by way of subscription at £22 per share, invested a further £0.5m in Engage Technology Partners Limited.
In Sept 2017 the Company invested, by way of subscription at £15 per share, £0.4m in Engage on a pre-new money valuation of £15m as part of a fully subscribed £5.25m funding round. Following this further subscription, Primorus will hold a total of 49,394 shares in Engage, representing circa 3.6% of the issued share capital.
The subscription price of £22 per share represents a 46% premium to the Sept 2017 placement price of £15 per share and represents a portion of rolling £4m capital raise by Engage.
NetScientific (LON:NSCI) 54.5p £37.63m
NetScientific, the transatlantic healthcare IP commercialisation group, notes that its portfolio company, Vortex BioSciences, has announced a collaboration with BioView Ltd (TASE:BIOV), a provider of automated cell imaging and analysis solutions.
The collaboration will enable Vortex and Bioview to create integrated workflows that will allow the collection of intact CTCs from blood samples to become part of the standard of care, with a view to increasing the prominence of CTCs in the clinical space as a diagnostic and monitoring tool. The aim of the collaboration is to provide clinicians with deeper insights into cancer biology.
BioView (TLV: BIOV) is a publicly traded company on the Tel Aviv Stock exchange, and currently has strategic collaborations underway with international scientific leaders and institutions. Bioview develops, manufactures and supplies cell imaging equipment, and analysis software to medical institutes and universities. It currently has several strategic collaborations with international scientific