Small Cap Wrap – AFC Energy, Xtract Resources, Mobile Streams and more…


16 Dec 2020


*A corporate client of Hybridan LLP

Dish of the day


Off the menu

No Leavers Today

What’s cooking in the IPO kitchen?

HSS Hire Group,HSS.L transfer from Main to Aim. Mkt Cap c. GBP70m. Recently raised GBP52.6m. Leading supplier of tool and equipment for hire in the United Kingdom and Ireland and has provided equipment hire services in the United Kingdom for more than 60 years, primarily focusing on the B2B market. Due 14 Jan 2021.

Vector Capital to float on AIM, a commercial lending Group that offers secured loans primarily to businesses located in the UK. Substantially all of the Group’s loans are secured by a first legal charge against real estate. The Group’s customers typically borrow for general working capital purposes, bridging, land development and acquisition. As of 30 September 2020, the Group had a loan book of GBP34.7m, with an average loan size of approximately GBP0.57m. Raising GBP3m. Mkt Cap GBP16m. Due late December.

Schroder BSC Social Impact Trust plc targeting a GBP100m raise. The Company’s investment objective is to be the first London listed investment company to deliver measurable positive social impact as well as long term capital growth and income, through investing in a diversified portfolio of private market impact funds, co-investments alongside impact investors and direct investments in order to gain exposure to private market Social Impact Investments. Due 22 Dec. Official List (Premium).

Ecofin U.S. Renewables Infrastructure Trust. Initial public offering of up to us$250m to invest in a diversified portfolio of mixed US renewable energy assets with an attractive long-term income stream. Main market premium. Minimum offer size reduced to $125m. Now due 22 Dec.

VH Global Sustainable Energy Opportunities plc, a closed-ended investment Company focused on making sustainable energy infrastructure investments, today announces intends to launch an initial public offering of shares on the Official List (Premium) of the Main Market of the London Stock Exchange. Due by Early Feb 2021.

Bytes Technology Group one of the UK’s leading software, security and cloud services specialists, to IPO (Main Mkt Prem). FY20 gross profit of GBP79.2m (+24.5% against FY19) and adjusted operating profit of GBP31.7m (+53.9% against FY19). Highly cash generative with FY20 cash conversion of 125.9% (FY19 cash conversion 139.7%). Offer price set at 270p Raising GBP352m. Mkt Cap GBP646.6m. Due on 17 December 2020.

Eddie Stobart Logistics (LON:ESL) converting to an AIM investing company. Name change to Logistics Development Group. Focus sectors: logistics, transport, warehousing and e-fulfilment assets. GBP9m to be raised via a placing and subscription and up to GBP7m via open offer. Market cap c.GBP35.1m. Due New Years Eve.

Reverse take-over under rule 14 by MelodyVR (AIM:MVR) Group of Rhapsody International, trading as Napster. Upon completion of the transaction, Napster will be a wholly-owned subsidiary of MelodyVR Group. The enlarged group will combine the service offerings of MelodyVR and Napster, offering music fans a consolidation of music artist’s repertoires including recorded music, short form video content, long form video content, digitally ticketed live streams, educational videos and immersive AR/VR content, into one premium subscription product. Raising $10.1m. Market cap GBP92.4m at 3.75p. Due 29 December.

Banquet Buffet

Agronomics 8.9p GBP44.2m (LON:ANIC)

The leading listed investor in alternative proteins with a focus on cellular agriculture and cultivated meat has today completed an investment of US$2.0m, in the form of a Simple Agreement for Future Equity (SAFE), in SuperMeat the Essence of Meat (SuperMeat). The Subscription will be paid using cash from the Company’s own resources. The SAFE will convert at a price per share reflecting the lower of the valuation cap or at a 25 percent discount to the share price of SuperMeat’s next equity round. The Company expects that upon conversion of the SAFE at the completion of SuperMeat’s next equity fundraise, and assuming that it will be done at a pre-money valuation of US$150m, Agronomics will hold approximately 2.22% of SuperMeat’s fully diluted share capital.

Epwin Group 93.4p GBP133.5m (LON:EPWN)

Trading update from the leading manufacturer of low maintenance building products, supplying the Repair, Maintenance and Improvement (RMI), new build and social housing sectors. The Group has experienced better than expected trading conditions since reporting its half year results to the end of June 2020 on 10 September 2020. Demand from the RMI market, which represents around 70% of Group revenues, has been particularly strong during the fourth quarter of the year, while demand from the new build and social housing sectors has also been increasing. As a result, the Group’s revenues and adjusted profit before tax for the year ended 31 December 2020 are anticipated to be ahead of current market expectations. Net debt at 31 December 2020 is also expected to be lower than current market expectations.

Genedrive 49p GBP27.7m (LON:GDR)

The near patient molecular diagnostics Company announces that it notified the Food and Drug Association (FDA) in the United States of its intention to import and distribute its Genedrive 96 SARS-CoV-2 Kit prior to an Emergency Use Authorization (EUA) determination, as described in the guidance on Policy for Coronavirus Disease-2019 Tests During the Public Health Emergency , Section IV.C.2. Notification was made on 25 November and acknowledged on 15 December. The current claims of the product cover high throughput testing on a variety of third-party RT-PCR platforms for upper respiratory track specimens.

Concurrent Technologies 109p GBP80m (LON:CNC)

The world leading specialist in the design and manufacture of high-end embedded computer products for critical applications in the defence, aerospace, telecommunications, transportation, scientific and industrial markets, announces a trading update for the year ending 31 December 2020. Based on its unaudited management accounts for 2020, the Company confirms that it expects to report revenues and profitability ahead of market expectations with cash generation remaining strong. The Company also expects to continue the practice of paying a further interim dividend to shareholders and to pay this on or before 6th April 2021.

FRP Advisory Group 105p GBP251.1m (LON:FRP)

Interim results from the leading UK professional services firm specialising in restructuring advisory for the six-month period ended 31 October 2020:. Revenue increased 14% in the first half to GBP35.9m, 9% on an organic basis. Adjusted underlying EBITDA up 7% to GBP9.7m. Adjusted PBT of GBP8.8m in line with Board expectations. Strong balance sheet with cash at 31 October 2020 of GBP15.4m and an undrawn committed revolving credit facility (RCF) of GBP5m. For the first half basic and diluted EPS is 2.48p. Adjusted EPS is 2.96p. The Board declares an interim dividend for the first half of 1.6p per eligible share. This dividend will be based on shareholders per record date of 19 February 2021 and will be paid on Thursday 18 March 2021.The board intends to adopt a quarterly dividend payment schedule commencing in 2021. The Board believes current trading is on track to comfortably achieve full year expectations.

Fast Forward Innovations 6.9p GBP12.8m (LON:FFWD)

The AIM quoted company focusing on making investments in fast growing and industry leading businesses announced that it has been issued GBP750,000 of 12 month Convertible Loan Notes (CLN) in EMMAC Life Sciences Group (EMMAC) as part of a funding round by EMMAC to raise GBP15m via the issue of unsecured CLN’s. The CLN Issue saw strong support from existing shareholders, with Measure 8 Venture Partners LP, EMMAC’s largest existing cash investor, leading the round with a significant investment. The funds raised through the issue of the CLNs, which has seen strong support from existing investors, will enable EMMAC to continue to build upon its position as one of Europe’s largest independent cannabis company. Growth in EMMAC’s key European markets including the UK continues to gain momentum as demand for medical cannabis and related wellness products grows.

Shanta Gold 14.25p GBP149m (LON:SHG)

Exploration update from the East Africa-focused gold producer, developer and explorer at the Luika Deposit (Luika) and the Porcupine South Target (Porcupine South) at New Luika Gold Mine (NLGM) in South Western Tanzania, based on activity conducted between September and November 2020. Porcupine South is a new open pit target and drilling results are expected to be converted into a JORC compliant resource in due course. Nine diamond core holes drilled at Luika totalling 4,042 metres, with further drilling ongoing. Twenty-eight Reverse Circulation (RC) holes drilled at Porcupine South totalling 2,466 m. The newly reported drilling intersections are outside existing mineral reserves and will be incorporated into the next update of the mine plan. Reported results are over a strike length of 200m for Luika and 500m for Porcupine South. Luika is one of NLGM’s three actively mined underground deposits and Porcupine South is a new target located approximately 22km east of NLGM, which is expected to be within economically viable trucking distance from the NLGM processing plant; and, mineralisation at both Luika and Porcupine South remain open at depth.

Mobile Streams 0.25p GBP2.9m (LON:MOS)

Final results, trading update and partnership to launch Streams service into China from the mobile content and data intelligence company. Group revenue for the year ended 30 June 2020 was GBP0.6m (2019: GBP1.3m). Trading EBITDA was negative GBP0.6m for year (2019: negative GBP0.7m). Loss before tax was GBP1.6m (2019: GBP0.6m loss). Most of the reduction in revenues is attributable to challenging trading conditions in Argentina. Revenue in Argentina (which equated to 77% of Group revenue) on a constant currency basis decreased by 25% from AR$48m to AR$36m. With the Company’s pipeline of product development and marketing, it expects to see continued growth into 2021, with Streams Data monthly revenues expected to exceed those of the legacy business during 2021. It also anticipates launching the Streams Data service in other key global markets during the next year. The Company announces that following extremely positive market feedback, it has entered into a partnership with ground-breaking Chinese digital communications agency ANOTHER to enter the Chinese market.

Xtract Resources 1.55p GBP9.6 (LON:XTR)

Xtract announces that it has commenced the Phase One drilling programme on the Bushranger copper-gold exploration project located in the Lachlan Fold Belt, New South Wales, Australia’s only world-class copper-gold province. As previously announced, the Phase One drilling programme will consist of three diamond drill holes for 2,290m, with the objective of testing the potential extensions to the northwest of the Racecourse Mineral Resource, which was estimated in 2018 as 71Mt @ 0.44% Cu and 0.064g/t Au, at a 0.3% Cu cut-off, and has been classified as Inferred in accordance with JORC (2012).

AFC Energy 44.2p GBP299m (LON:AFC)

The leading provider of hydrogen power generation technologies announced the signing of a strategic partnership with ABB, a world leader in electrification and digitalisation technologies, operating in over 100 countries. ABB and AFC Energy to develop and launch a bespoke high power EV charging product for distribution through ABB’s market channels from the second half of 2021. The strategic partnership aims to leverage respective company technologies with regards to AFC Energy’s zero emission, high efficiency fuel cell technology alongside ABB’s energy storage and market leading DC high power EV charge points. Global EV charging market is expected to exceed US$140bn by 2030 with power network upgrades necessary to facilitate this level of deployment forecast to exceed GBP50bn in the UK alone.

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