2Ergo (LON:RGO) [24.5p/ £8.69million]
The mobile solutions company has reported that it has conditionally raised £2.2 million (before expenses) through the placing of 15 million new shares with both new and existing shareholders at a price of 10p per share and through three of the directors - Neale Graham, Barry Sharples and Keith Seeley - agreeing to subscribe, in aggregate, for seven million new shares also at a price of 10p per share.
The placing price is a discount of 74% to the closing mid-market price of 38.5p on 13 September 2012, the latest date prior to the announcement. The net proceeds of the issue will provide access to additional working capital and the capital resources required to undertake the necessary investment in the rollout of the podifi™ and TikTap™ contactless mobile technology platforms.
Alliance Pharma (LON:APH)[26.5p/£63.44 million]
Alliance Pharma the speciality pharmaceutical company, has announced interim results for the six months to 30 June 2012, which saw a narrowing of both sales and pre-tax profit to £22 million (2011: £24.4 million) and £5.3 million (2011: £7 million) respectively. Hydromol™ (a skincare product) did however grow by 28%.
Increased competition in part explains the performance, with Nu-Seals (a low-dose aspirin) for example facing a tough time in Ireland, together with a production issue around the ImmuCyst product. Despite this, the company increased its interim dividend by 10% to 0.275p, perhaps demonstrating management confidence in the outlook for the company - the acquisition of three products from AstraZeneca (LON:AZN) in August being a key step for Alliance and maybe explaining this.
Altitude (LON:ALT) [18.25p /£7.80 million]
The provider of information and technology services to the promotional products industry announced its interim results for the six-month period ended 30 June 2012. Revenue from continuing operations increased by 17% to £2.86 million (first half 2011: £2.46 million) whilst pre-tax profit increased to £235,000 (first half 2011: £63,000). Cash on the balance sheet is higher at £0.61 million (first half 2011: £0.29 million).
Product development continues to be a focus for the company and is continuing to increase developer headcount modestly in the USA over the next three to six months. The outlook appears to be one of continuing product range development - an official launch of the Customer Focus brand, which offers a range of business management solutions at varying prices for small companies requiring enterprise level functionality, is expected to launch in the latter part of this year.
Anglesey Mining (AYM) [9.3p/£14.94 million]
Anglesey Mining's 26% owned associate Labrador Iron Mines Holdings (LIM) held its annual meeting of shareholders in Toronto at which an operations update of its Schefferville area iron ore mining operations was provided. LIM commenced its first full season of production in April 2012. In the operating period to August 31, seven shipments of iron ore have been sold, totalling 1.2 million wet tonnes. This is a significant achievement, representing a three-fold increase over iron ore sales for all of 2011.
During this period of weakness and uncertainty in the iron ore market, it is essential to remain disciplined in cash management and capital spending programs and reduce operating costs. Consequently, consistent with announcements made by major iron ore companies, some capital investment programmes have been suspended and others deferred in order to focus resources on optimising production in the short term. For the remainder of the 2012 season, LIM plans to produce only standard sinter fines and lump and will continue to work closely with IOC and Rio Tinto (RIO) to monitor market conditions to seek to achieve the most favourable sales outcomes under difficult market conditions. For 2013 and following years, and subject to market conditions, operations will be focused on Stage 1 and 2 deposits.
Auhua Clean Energy (LON:ACE) [38.5p/£24.47 million]
Auhua the environmental technology group based in China, has reported that revenue increased by 35% year on year to ¥95.6 million (£9.7 million) for the six months to June 2012. Net profit after tax grew strongly by 20% year on year to ¥23.7 million. Orders and cash balances on 30 June 2012 were ¥74.8 million and ¥32.7 million, respectively. The management believes that regulatory changes in the industry and the recognition of Auhua's strengths by the property-related government agencies will provide the company a strong foundation towards further growth in second half of 2012.
Avingtrans (LON:AVG) [86.5p/£22.52 million]
Avingtrans which designs, manufactures and supplies critical components and associated services to the global aerospace, energy, medical and industrial sectors, announced its results for the 12 months ended 31 May 2012. Turnover increased by 21% to a record £44.0 million (2011: £36.3 million), gross profit margin was 27% (2011: 29%) on adverse product mix and adjusted pre-tax profit increased by 43% to £2.3 million (2011: £1.6 million). Net debt increased to £8.4 million (2011: £6.6 million) and the final dividend was boosted to 1.0p per share (2011: 0.4p).
Management reported that both the Sigma and CH Precision Finishers divisions enjoyed strong growth in the civil aerospace market, and order books were at record levels.
Ceres Power (CWR) [11.75p/£10.13 million]
In line with the company's announcement on 26 July 2012, Ceres provided an update on the planned programme of work to further improve the long-term durability of its core fuel cell technology, and published an independent assessment of the company's core technology by an international expert in fuel cells and related technologies. Testing was conducted on simulated natural gas reformate which is identical to actual reformer output in systems operation. In parallel, Ceres continued to improve the already established core technology capability to withstand multiple start-stop events (shut-downs).
These results give the board further confidence that Ceres core technology is compatible with the requirements for a realworld residential CHP appliance. The Ceres development plan requires further testing and refinement of its core technology and validation of degradation and cycling on multiple stacks over extended periods of operation, through to the next field trials in 2014 and the anticipated product launch in 2016.
Eden Research (EDEN) [13p/£14.44 million]
The agrochemical and encapsulation development company announced that it is expanding its collaborative efforts with Certis Europe BV to investigate additional product applications, including using Eden's proprietary encapsulation technology with an existing agrochemical. In addition, Eden has agreed to extend the term of the existing option agreement that it has with Certis for its nematode product to 31 March 2013 and, at the same time, restrict the territory to Europe only.
Elektron Technology (LON:EKT) [16.25p/£19.42 million]
Elektron the developer of fast-moving engineered products with market-leading positions in connectivity, instrumentation and monitoring and control, has reported that revenues fell by 13% year on year to £29.9 million in the six-month period to July 2012. Operating profits in this period more than halved to £1.6 million. This reflects the economic uncertainty and deferred spending which continued from the second half of last year.
However, the company continues to invest in new product development capabilities, with new product launches helping to reduce reliance on legacy products.
Fitbug [1.38p/£2.32 million]*
The AIM-listed provider of online personal health and well-being services announced the launch of Fitbug Air, the world's first Bluetooth Low-Energy Fitbug activity tracker designed to increase the usability of the company's product by wirelessly syncing users' data to mobile devices.
Fitbug Air provides customers with instant access to their personalised health and wellness programme and Fitbug's motivational tools anywhere, at any time. Fitbug Air offers seamless, wireless connectivity to the latest generation of mobile devices, including smartphones, such as the Apple iPhone 4S and the recently launched iPhone 5, Bluetooth 4.0-enabled tablets such as the new iPad and the recently updated iPod Touch. Connectivity to other leading Bluetooth 4.0-enabled smartphones such as the Samsung Galaxy S III will follow later in the year.
Activity levels can be continuously uploaded without the need for cables, receivers or constant computer access. Additionally, the low-energy nature of the technology enables months of continuous usage (up to six months), eliminating the regular need to recharge or replace the battery. The company has ensured that the Fitbug Air is very competitively priced in comparison to other online activity-tracking and device programmes.
Futura Medical (LON:FUM) [60.25p/£44.41 million]
Futura Medical announced interim results for the six months ended 30 June 2012. In the period, it gained the rights to CSD500 and MED2002 and regarding PET500, the US launch by Ansell under the LifeStyles® brand is taking place and the CRF100 product for Cellulite reduction completed its clinical trial. John Clarke joined the company as non-executive chairman to lead the next stages in its development.
Futura posted a net loss of £0.96 million in the period with a net cash outflow of £0.72 million and had cash resources of £1.86 million at 30 June 2012. Futura Medical separately announced a placing in which gross proceeds of £2.08 million are being raised at a price of 57p per share. The placing strengthens the balance sheet and will assist the company in its out-licensing negotiations as well as the ongoing development of its product pipeline.
Galantas Gold (GAL) [2.88p/£7.37 million]
The gold producer and explorer with a 100% interest in Ireland's only operating gold mine has received consent from the Planning Service (Department of the Environment Northern Ireland), to construct a lower portal and truncated tunnel structure as part of the restoration of the Kearney open pit at the Omagh gold mine. This keeps open the opportunity to access gold resources below the open pit, whilst speeding up development of an underground mine which is undergoing planning permission.
Planning consent was previously given for the removal of excess rock at the lower northern section of the Kearney open pit which provided a restriction to development, though is now subject to a judicial review between the planning service and another individual on the grounds of procedural failings. The company also announced a reduction in the workforce.
HaloSource (LON:HAL) [21p/£5.58 million]
HaloSource has entered into a strategic partnership with Pentair, a leading water solutions provider in Brazil, to market and sell its HaloPure® Water Pitcher and replacement cartridges throughout Brazil. Over the next three years, Pentair will offer the co-branded point-of-use devices through Pentair's retail and wholesale channels in the Brazil market. The partnership will add HaloPure technology to Pentair's product offering to eliminate bacteria and viruses, providing safer drinking water for the consumer. Pentair is a global diversified industrial company headquartered in Minneapolis, Minnesota with sales of $3.5 billion in 2011.
According to Verify Markets' 2012 report on Global Water Treatment, the Brazilian market was the largest global residential water treatment market in Latin America in 2011, with estimated revenues of over $200 million. Consumers will find HaloPure-powered pitchers in Brazil starting in the fourth quarter of 2012.
Ilika (LON:IKA) [51.5p/£23.45 million]
llika the advanced clean-tech materials discovery company, announced it has taken the decision to implement a rationalisation of its biomedical division. The biomedical division currently operates a high-throughput platform for the discovery of novel, biologically active materials as well as the provision of wound-care products and services. The rationalisation will involve discontinuing the provision of its wound-care products and services with effect from the end of the calendar year. The biomedical division will continue to focus on its core competencies associated with its high-throughput operations.
Turnover generated by the wound care business in the financial statements covering the year to 30 April 2012 was £160,072 (total group turnover £2,011,244), with £188,611 generated from its biomedical high-throughput activities.
Oxford Pharmascience (LON:OXP) [1.4p/£8.08 million]*
Oxford Pharmascience announced it has executed its option to exclusively license a drug-delivery technology from UCL Business, (the intellectual property licensing arm of University College London) to develop and commercialise a range of reformulated statins, using the generic drugs atorvastatin and simvastatin.
Following a successful evaluation period, the company has established the feasibility of the delivery system in working with these drugs and undertaken a commercial evaluation to identify the potential for a range of statin products which it is launching under its Safestat™ programme. Safestat™ aims to reformulate the widely-used molecules of atorvastatin and simvastatin into doses up to four times lower than the original dose but with the same lipid lowering efficacy as the original higher dose. Early research into the concept has been extremely well received by both clinicians and healthcare payers alike.
OXP also announced its interims. 2011 was a breakthrough year for the company, having changed its focus to the higher-value pharmaceutical market. The commencement of sales to Aché, one of Brazil's largest pharmaceutical companies and the launch of its OXP zero™ taste-masking technology left it well placed going into this year. Revenues from OXPchew™ technology continue to grow, with strong sales from Aché and earlier-than-expected commencement of revenues to the Far East.
Importantly the company signed its first licensing deal with a major global pharmaceutical company, Bayer. Co-development work has begun with Hermes Pharma for a range of ibuprofen direct to mouth granules using OXPzero™. This will result in clinical studies later this year to demonstrate the bioequivalence of OXPzero™ ibuprofen salt, a major step towards securing the first licensed medicine using the technology.
Petrel Resources (LON:PET) [4.25p/£3.26 million]
Petrel Resources provided an update on the company's position in Iraq. In mid-2012, Petrel appointed a new Baghdad/Amman-based team of Iraqi citizens to review the standing of and opportunities for Petrel in Iraq. The first objective was to clarify the position of Petrel with the national authorities in relation to existing and historic projects in which Petrel has or had an interest. This clarification is now complete. The second objective is to work with national and regional authorities in Iraq to identify projects in which Petrel can be involved and this work is ongoing.
Photon Kathaas Productions (PKP) [$0.28/$5.92 million]
The south Indian film company has published its results for the six months ended 30 June 2012.
During the period it made further progress in developing its portfolio of south Indian language films and associated properties; completed its fifth film Thanga Meengal; Ekk Deewana Tha, a Hindi co-production with Fox-Star Studios was released; and it commenced production of Tamilselvanum Thaniyaar Anjalum bilingual (Tamil/Telugu). The online trailer for Tamil/Telugu bilingual was launched on 2 September 2012 and had record views of over two million (to date) on YouTube, thereby becoming one of the top five most-viewed videos on YouTube (entertainment).
Five films are due for release in the second half of 2012. Photon reported revenue of $1,372,368, gross profit of $368,455, pre-tax profit of $114,621 and post-tax profit of $84,515.
Surgical Innovations (LON:SUN) [9.12p/£36.78 million]
Surgical Innovations, the designer and manufacturer of creative solutions for minimally invasive surgery (MIS), announced unaudited interim results for the six months ended 30 June 2012, which show continued growth in higher margin SI-branded products. Revenues of £3.02 million (first half 2011: £3.20 million) - entirely made up of core MIS business revenue were reported, alongside gross margins in core MIS business which increased to 44.8% (first half 2011: 41.9%).
Pre-tax profit before exceptionals was maintained at £475,000 (first half 2011: £474,000) and basic earnings per share before exceptional costs was 0.14p (first half 2011: 0.12p). Net cash of £888,000 was generated from operating activities ex exceptional costs (first half 2011: £594,000). Revenues from SI-branded products were up 8.9% to £2.13 million (first half 2011: £1.95 million and revenues from original equipment manufacturing products were down 28.5% to £0.89 million (first half 2011: £1.24 million) - due to the timing of key orders expected to fall in the second half.
Strong sales of Resposable® instruments with consumable pull through are expected in the second half and beyond, with disposable elements from SI Branded Resposable® lines now representing 64% of total SI-branded product sales (Full year 2011: 62%). Booked orders for the full year already exceed group turnover for year ended 31 Dec 2011.
Ubisense (LON:UBI) [219p/£47.75 million]
Ubisense Group, a market leader in location-based smart technology, announced the expansion of its RTLS installation with Hyundai Kia in Asia. The phase two expansion comes after the success of the pilot installation deployed just two months ago to their assembly line manufacturing plant in South Korea. Richard Green, Ubisense's chief executive officer, said Hyundai's decision to increase its RTLS installation reinforces its previous deployment decision and emphasises the growing traction that Ubisense's solution is receiving around the world. Ubisense now has a foothold in eight of the top 15 automotive manufacturers globally.
William Sinclair Holdings (SNCL) [159.5p/£27.15 million]
The supplier of growing media announced the acquisition of a major new production site at Ellesmere Port, Cheshire, for consideration of £4.75 million, which will offer the company a second production facility for 'SuperFyba', and thereby double the annual production capacity to approximately 300,000 cubic metres per annum.
*A corporate client of Hybridan LLP
The Hybridan Small Cap Wrap is a weekly review of some of the most interesting small cap stories of the past week. Our review will usually be of those companies whose market capitalisations are less than £50 million although we may occasionally cover larger companies. Our review is not intended to constitute research and is not to be taken as investment advice.
Filed Under: Smallcaps,
This document should not be relied upon as being an impartial or objective assessment of the subject matter and is not deemed to be "independent research" for the purposes of the Financial Services Authority (FSA) rules. As a consequence the research (a) has not been prepared in accordance with legal requirements designed to promote the independence of investment research; and (b) is not subject to any prohibition on dealing ahead of the dissemination of investment research (although Hybridan does impose restrictions on personal account dealing in the run up to publishing research as set out in our Conflicts of Interest Policy).
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 partners and/or employees who prepared this document may have responsibilities that conflict with the interests of the persons who receive this document.
This document has been issued 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. 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. The information contained herein is based on materials and sources that we believe to be reliable, however, Hybridan LLP makes no representation or warranty, either express or implied, in relation to the accuracy, completeness or reliability of the information contained herein. Opinions expressed are our current opinions as of the date appearing on this material only. Any opinions expressed are subject to change without notice and Hybridan LLP is under no obligation to update the information contained herein. None of Hybridan LLP, its affiliates or employees shall have any liability whatsoever for any indirect or consequential loss or damage arising from any use of this document.
In the UK, this report is directed at and is for distribution only to persons who (i) fall within Article 19(1) (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 Promotions) Order 2005 (as amended) or (ii) are Professional Clients or Eligible Counterparties of Hybridan LLP (all such persons together being referred to as "relevant persons"). This report must not be acted on or relied up on by persons in the UK who are not relevant persons.
Neither this report 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 report comes should inform themselves about, and observe any such restrictions. Distribution of this report in any such other jurisdictions may constitute a violation of UK or US securities law, or the law of any such other jurisdictions.
Investments in general involve some degree of risk, including the risk of capital loss. The services, securities and investments discussed in this document may not be available to or suitable for all investors. Investors should make their own investment decisions based upon their own financial objectives and financial resources and, if in any doubt, should seek advice from an investment advisor. Past performance is not necessarily a guide to future performance and an investor may not get back the amount originally invested. Where investment is made in currencies other than the investor?s base currency, movements in exchange rates will have an effect on the value, either favourable or unfavourable. Levels and bases for taxation may change. When Hybridan LLP comments on AIM or PLUS Markets shares investors should be aware that because the rules for those markets are less demanding than the Official List of the London Stock Exchange the risks are higher. Furthermore, the marketability of these shares is often restricted.
Hybridan LLP and/or its associated companies 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 partners, directors and 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. Neither the whole nor any part of this material may be duplicated in any form or by any means. Neither should any of this material be redistributed or disclosed to anyone without the prior consent of Hybridan LLP. Hybridan LLP is Authorised and Regulated by the Financial Services Authority and is a member of the London Stock Exchange.
29 Throgmorton Street, London EC2N 2AT
If you would like to receive other research reports from Hybridan, or would like to unsubscribe, please e- mail email@example.com, title e-mail "research reports" or "unsubscribe me" Hybridan LLP is authorised and regulated by the Financial Services Authority Member of the London Stock Exchange