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Hybridan Small Cap Wrap
09:29 06 Jul 2011
Omega— one to watch, New recent highs for
Summit, Reach into Trap
A 5% increase in the FTSE 100 together with a 3% improvement in the AIM All Share was welcome news, perhaps in
part helped by news last week that European banks were planning to club together in helping Greece by potentially
allowing it more time to repay its debts. UK manufacturing data released last week did little to stop the progress of the
markets with growth having slowed in June to its lowest rate for more than 18 months, though the previously announced
0.5% expansion of the UK Economy is likely to have helped this as has UK service sector growth. The week ahead will
see the BoE announce their interest rate decision which is widely predicted to remain at 0.5%, despite inflation at 4.5%,
together with UK producer price data and UK industrial production figures.
Access Intelligence (LON:ACC 3.5p / £9.00m)
Access Intelligence, a leading supplier of compliance Software-as-a-Service solutions for the financial services,
procurement and media sectors, this week announced the sale of its subsidiary, Solcara, to Thomson Reuters for
£2.5m. Solcara sells search technology to the legal profession and in-house legal teams and in the year to 30
November 2010 had sales of approximately £750,000 on which it generated a small profit. The Company also updated
the market on trading for the six months 30 May 2011. Most of the group has been trading in line with expectations with
Due North Ltd and AIMedia Communications Ltd in particular having had a successful first six months. During the first
six months the company has completed the restructuring of its capital base creating positive revenue reserves in the
parent company allowing it to pay dividends in the future. The group cash balance at 30 May 2011 was approximately
£2.7m which will, following completion of the disposal of Solcara, increase to approximately £5m.
AFC Energy (LON:AFC 44.5p / £77.14m)
AFC Energy, a developer of low cost alkaline fuel cells announced that it continues to make good progress. It has
completed the first stage of its Beta alkaline fuel cell system where it has made significant progress on completing the
hazard and operability study (HAZOP) and has incorporated the emerging improvements from that study into its first
system. Once the HAZOP study is successfully complete, AFC remains on track to deliver its commercial scale Beta
system.
Akers Biosciences (LON:AKR 4p / £6.75m)
The company, a leading designer and manufacturer of rapid diagnostic screening and testing products, last week
announced that it had secured a first purchase order totalling approximately US$3.2m from Pulse Health under the
supply agreement announced on 11 April 2011. Manufacturing will commence immediately from the company's New
Jersey facility with the majority of orders expected to be fulfilled during 2011. The order is to manufacture and supply
Revelar breath tubes which as part of the Revelar Free Radical Assay provides the first rapid, non-invasive way to
measure the effectiveness of an antioxidant regimen and adapt accordingly.
Amur Minerals Corporation (LON:AMC 12.5p / £35.43m)*
An exploration and development Company focused on Far East Russia last week announced its final results for the
year ended 31 December 2010. Over the year, its application for a mining licence covering drilled resources at KunManie, an area 15km by 3km, was submitted. The nickel copper sulphide project contains three JORC compliant drilled
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The Business Centre 6 Wool House, 74 Back Church Lane
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United Kingdom Company No. 05639690
VAT No. 87207082
deposits. Total Russian approved reserve of 31.7m tonnes of ore with averages 0.64 per cent nickel and 0.18 per cent
copper were reported. The Russian reserve inventory also contains 3,960 tonnes of cobalt, 189,400 ounces of platinum
and 213,800 ounces of palladium. The exploration rights over 950 sq. km. licence area were extended to December
2012. Wildcat drilling identified a potential open pit 4km from the Maly Krumkon deposit. Trenching confirms that
mineralisation could continue along strike towards Maly Krumkon. A geophysical anomaly to the south of Ikenskoe
defines an area nearly as large as that of the drilled deposit. Amur had $3m of cash in the bank at the year end. Robert
W. Schafer, Chairman commented: "We made significant progress in 2010 and this has continued into the current year.
We have commenced a two year exploration programme to further extend and define the existing resource at KunManie as we work towards bankable feasibility status."
Angel Biotechnology Holdings (LON:ABH 0.32p / £8.73m)*
AIM listed biopharmaceutical contract manufacturer has signed a new contract with ReNeuron Group (RENE 5.645p /
£35.06m) to perform development and GMP manufacturing services in support of its development programme for its
ReN001 stem cell therapy for stroke. The work programme is expected to continue through to mid-2012; the value of
the contract was not disclosed. The programme includes the GMP manufacture and related work for future cohorts of
patients in ReNeuron's ongoing PISCES clinical trial with ReN001 in stroke. The contract is structured in such a way
that it allows much more flexibility for both parties in terms of work scheduling, thereby giving ReNeuron the ability to
match the needs and opportunities of their growing development programmes in real time.
Ark Therapeutics Group (LON:AKT 5.2p / £10.88m)
UK listed Ark yesterday announced that the United States Patent and Trademark Office has issued Notices of
Allowance in respect of two patents for which certain rights have been assigned by Ark to Boehringer Ingelheim. The
patents cover the use of Boehringer Ingelheim's compound Telmisartan for the prevention and treatment of stroke and
the prevention of myocardial infarction related heart damage. Formal grant of these patents is expected in the next two
months and will trigger significant milestone payments to Ark under the license agreement which Ark and Boehringer
Ingelheim entered into in 2005. This good IP news is a step further to a potential milestone which will be an important
contribution for the Company.
Beacon Hill Resources (LON:BHR 12.12p / £89.80m)
Beacon Hill Resources, the AIM listed coal producer, will engage in their first production of export grade coal at Minas
Moatize coal mine in Tete, Mozambique. This large open pit mine will expect to be mined in Q1 2012. The total
estimated JORC resources of the initial open pit area is approximately 180,000, which is expected to be gradually
mined over the course of the next twelve months. Additionally, the trial trucking of coal to Beira by road is to start in July
will enable the Company to start stockpiling coal at the port pending a first export shipment. In Tasmania, the Group
has recently completed phase 1 of a drilling programme at the Arthur River Project. The results will provide the
Company information about the deposit including size, metallurgy and hydrology. These aspects will help confirm the
economics of the project and the development of an initial conceptual mine plan. The latter is being finalized, with the
expectation of it being completed before the end of 2011.
Beximco Pharmaceuticals (LON:BXP 40p / £18.82m)
Beximco, the AIM listed pharmaceutical Company, last week held its AGM at which the chairman reported a strong
performance from the company. Beximco is based in Bangladesh and manufactures and sells generic pharmaceutical
formulation products, active pharmaceutical ingredients and intravenous fluids as well, as undertaking contract
manufacturing for multinational pharmaceutical Companies. Its products are sold to retail outlets, medical institutions
and other pharmaceutical manufacturers in Bangladesh, in regional markets including Sri Lanka, Nepal, Vietnam and
Cambodia as well as other overseas markets.
Chariot Oil and Gas (LON:CHAR 195p / £352.54m)
Chariot Oil and Gas has an updated Competent Person's Report which confirms the Company's estimate of prospective
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The Business Centre 6 Wool House, 74 Back Church Lane
London, E1 1AF
United Kingdom Company No. 05639690
VAT No. 87207082
resource volumes. The results show a gross P50 unrisked prospective resources volumes of 14.4bn barrel with gross
mean unrisked prospective resource potential of 16.1 Bbbls, a slight increase of 3.5 per cent or 535m barrels within the
Company's license areas offshore Namibia. Paul Welch, CEO of Chariot, comments: "These volumes have resulted
from the extensive geological and geophysical work undertaken by the Chariot technical team across all our licence
areas. It is very satisfying to continue to have third party endorsement of our prospective resources. Having established
the potential of our assets, we now look forward to the next stage of our development and the drilling of our prospect
inventory."
Corero (LON:CORO 42p / £20.04m)
Corero, the provider of software solutions to the banking and securities and education markets, provided a trading
update for the 6 months to 30 June 2011. The Company acquired Top Layer Networks in March 2011 which it intends
to use to build a network security technology business focused on delivering software and hardware solutions to midmarket commercial and enterprise customers and telecommunication service providers, through international channels.
The period saw a number of other crucial achievements including the launch of the DDoS Defence System (an industry
first network layer and application layer DDoS defence product), the recruitment of a sales team in France and Taiwan
and the appointment of twenty new channel partners. Corero Business Systems, which operates as a standalone
business, also saw the Company perform strongly with sales orders in the period of £2.5m (2010: £1.5m). Corero
appears to be evolving as quickly as the market does, and in some ways even quicker- we keep close eye on how the
Company continues.
EnCore Oil (LON:EO. 61.50p / £180.01m)
EnCore will acquire together with its partners in Block 15/21g (Nautical and Serica ) a 70 percent interest in the
adjacent Block 15/21a from DEO Petroleum, Faroe, Maersk and Atlantic Petroleum. The primary target in the P218
license is the Spaniards/Gamma discovery well which was drilled by Amerada Hess in 1989 and which EnCore believes
has significant upside potential and an attractive risk profile. EnCore will be the operator and plans to commence
drilling in the second quarter of 2012.
Kibo Mining (LON:KIBO 2.88p / £10.86m)
Kibo Mining, the mineral exploration and development Company with interests in gold and nickel projects in Tanzania,
had an increase in share capital following the acquisition of Morogoro Gold Limited and the accompanying equity
investment by Mzuri Gold Limited. The Company's expanded position gives them access to one the largest mineral
licence portfolios in this region, and it is also strategically located close to producing mines near Lake Victoria in
northern Tanzania. Furthermore, it's also in the vicinity of emerging gold areas of central and eastern Tanzania. With a
completed listing on AltX of the JSE Limited and an additional placing of ZAR 12,002,200 (£1.1m), the CEO now looks
forward to a raised profile to help them raise monies from these additional markets for prospective projects and further
acquisitions in Africa. Currently, a successful exploration programme over 2011 is underway and he is confident that it
will increase value in the Company's Tanzanian assets. The Company is also observing good results from the Haneti
nickel project and metallurgical testing of ore at the Itetemia project is now progressing.
Landsdowne (LON:LOGP 21.38p / £17.42m)
Lansdowne Oil & Gas, the oil and gas exploration Company, has started 3D seismic operations on its Amergin,
Rosscarbery and Midleton Prospects in the North Celtic Sea, off the south coast of Ireland. The surveys are expected to
take 20 days to complete. This survey forms part of the planned pre-development drilling programme on the Barryroe oil
discovery, in which the Company holds a 20 per cent interest. The drilling here is scheduled to start late this summer,
with the belief that the 3D seismic data, along with the modern well completions in the current high oil price
environment, will be key aspects that contribute to the value of Barryroe.
Max Petroleum (LON:MXP 12.5p / £115.38m)
Max Petroleum, an oil and gas explorer announced that the Kazakh government has approved an extension of the trial
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The Business Centre 6 Wool House, 74 Back Church Lane
London, E1 1AF
United Kingdom Company No. 05639690
VAT No. 87207082
production project for the Zhana Makat field until December 15th 2011 and added that it expects daily production to
increase to more than 3,000 bopd during Q3 2011. Receipt of final approval will allow the Company to develop and
produce the field for up to 25 years, as well as grant a right to sell 80 per cent of its crude oil production on the export
market under the terms of the Contract. Current oil sales into the domestic market are generating after-tax net proceeds
that are $15-$17 per barrel lower than comparable export sales. The Company is currently producing 2,200 bopd,
generating $3.5m in net proceeds per month from domestic sales.
Medilink (LON:MEDI 9p / £10.70m)
The Company, an electronic health card network service provider, last week announced its final results for the year
ended 31 December 2010. Revenue increased by 44 per cent. to £1.79m (2009: £1.24m) as the result of the overall
increase in activities across South East Asia and the China operations. Loss before tax was reduced by 26 per cent. but
remained at £696,000 (2009: £942,000) because the increase in revenues was partly offset by a corresponding
increase in operating costs for the China and Malaysian operations.
The financial year saw the company gain increased traction in China whilst the business activities in Malaysia continue
to expand. Medilink won six additional Third Party Administrator contracts in China and offered a new service in
Malaysia offering Medical Tourism programmes to foreigners travelling in the country.
Looking forward, the chairman reported that they anticipate the company sustaining minor losses in 2011 as the
expected increase in revenues in 2011will not be sufficient to cover the group's operating costs. The Board remains
confident of being able to move into profitability during 2012.
Omega Diagnostics (LON:ODX 14.12p / £12.04m)
AIM listed developer of medical diagnostic devices announced final results for the year to 31 March 2011. The year has
been one with a number of important steps, including the acquisition of the in-vitro allergy diagnostic business of
Allegropharma (€6m) to help the Company enter the Allergy Testing market, together with the establishment of an
agreement with Immunodiagnostic Systems Holdings for the rights to develop and distribute allergy tests on its IDSiSYS automated assaying device. A 27 per cent increase in revenue for the period to £7.9m (2010: £6.2m) and a 25 per
cent increase in adjusted profit before tax to £0.74m demonstrate sound improvements in performance, with the
acquisition already appearing to be earnings accretive- allergy and autoimmune revenues were up by 134 per cent to
£1.56m. Last month we wrote on the Company's announcement that it had signed a ten year deal with Toyota Tsusho
America Inc. for the sale and distribution of its Food Detective(TM) product into the US market. In addition to this,
Omega, during the period also signed a distribution agreement for its Food Detective product in India. A good year
which could potentially demonstrate good improvement.
OMG (LON:OMG 28.50p / £20.12m)
AIM listed technology group providing image understanding products for the entertainment, defence, life science and
engineering industries, announced that Yotta DCL, the Company's highways surveying business, has won new
contracts for business. Newcastle City Consortium has awarded the Company a three year contract to conduct its entire
road network surveying work, whilst Cumbria County Council has awarded the Company a four year contract to carry
out all of its Scanner and Scrim surveys whereby vehicles are used to survey the roads with a number of synchronised
measurement devices such as laser profilers and cameras to accurately determine the condition of the road surface,
covering 4,784 miles of network highway. In May, the Company announced a loss for 6 months to 31 March 2011, and
whilst management were disappointed, these recent contract wins demonstrate the continued resilience of OMG.
Rockhopper Exploration (LON:RKH 262.75p / £678.26m)
Rockhopper Exploration, the North Falkland Basin oil and gas exploration Company, holds a 100 per cent position in
the May 2010 discovery of Sea Lion. Since then, the Company has been focused on reaching a final investment
decision and progressing work streams to do so. The work streams include: appraisal to define the field size,
engineering to define the field development, and financing to define the field economics. The Company is focused on
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The Business Centre 6 Wool House, 74 Back Church Lane
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United Kingdom Company No. 05639690
VAT No. 87207082
the Falkland Islands and will be interpreting data from the recently acquired 3D seismic to spot further opportunities
within the basin. The Company is fully funded to complete the field appraisal at Sea Lion; however, a development
would require further financing.
Scancell Holdings (LON:SCLP 63p / £10.05m)
AIM listed developer of therapeutic cancer vaccines announced results for the year ended 30 April 2011. A key
development milestone was reached with the lead therapeutic melanoma vaccine SCIB1, phase I/IIa clinical trials
began in June 2010 and licensing agreements were secured with The National Institutes of Health; and Cancer
Research Technology Ltd. Scancell entered strategic collaborations with ImmuneRegen BioSciences, Inc and immatics
biotechnologies GmbH. The loss before tax for the year was £1.72m (2010: £1.8m). The cash at the yearend was
£1.1m, not including the net proceeds from the placing which was announced at the same time as the results, to raise
£1.73m gross to fund working capital. At the same time as the results announcement, a new lung cancer vaccine,
SCIB2, announced latest anti-tumour results to provide further validation of the ImmunoBody vaccine technology
platform and its commercial potential. Richard Goodfellow was also announced as Joint Chief Executive Officer.
Scancell should now have enough cash to complete the Phase I trials of the melanoma treatment and to advance the
development of a series of new ImmunoBody cancer vaccines to the pre-clinical proof of principle stage.
SeaEnergy (LON:SEA 28p / £19.35m)
AIM listed SeaEnergy last week announced that it has completed the disposal of its entire interest in SeaEnergy
Renewables Limited to Repsol Nuevas Energias S.A. The Company has used the cash from the disposal to repay loans
due to LC Capital Master Fund, Ltd and EDPR UK Limited totalling £6.9m. SeaEnergy will now focus on its existing
assets, in particular its offshore renewables marine services business SeaEnergy Marine, and to ensure that
shareholder value is protected with its existing Oil & Gas interests. The Board expects the Company to continue to be
active in both the offshore renewables and oil & gas sectors going forward. SeaEnergy announced its audited results for
the year ended 31 December 2010 at the same time. There was a loss for the year of £5.7m (2009: loss of £6.5m), the
cash position at the end of 2010 of £0.1m (2009: £2.8m), and the disposal of the Company's interest in SeaEnergy
Renewables Limited resulted in a gain of £32m and increased the cash balance to £28m.
Sirius Minerals (LON:SXX 9.68p / £99.90m)
Sirius Minerals, a globally diversified potash development group, has started a concept study on the York potash
project. During this study, various options and development alternatives for the project will be analysed and tested. A
thorough innovation analysis phase will be incorporated to ensure the latest breakthroughs in mine and process
development and sustainable design are incorporated into the project. The Company expects this to be completed by
the end of 2011. The appointment of a team of consultants to deliver the concept study has been finalised, via its
subsidiary, York Potash Ltd.
Summit Corporation (LON:SUMM 7.75p / £13.04m)*
UK drug discovery Company has seen a nice share price rise following reporting positive data from its programme to
develop a treatment for Alzheimer's disease and other neurological disorders, through the targeting of O-linked Nacetylglucosaminidase (OGA), an enzyme that represents a potential disease modifying approach for the treatment of
the disease. The results were generated using Summit's proprietary Seglin technology drug discovery platform. The
enzyme OGA has emerged as a target in the search for drugs to treat Alzheimer's disease as its inhibition reduces
levels of abnormal tau protein in the brain, meaning that OGA has the potential to protect nerve cells and prevent
formation of toxic protein tangles. Using the Company's innovative Seglin drug discovery platform, Summit has
developed novel, potent and very selective small molecule inhibitors of the OGA enzyme. Initial proof of concept has
been established in human cell models with Seglin compounds being shown to significantly reduce the levels of
abnormal tau protein. Further in vitro evaluation shows that the active Seglins exhibit no cell toxicity (cytotoxicity). The
results will be presented at the Alzheimer's Association International Conference on Alzheimer's Disease 2011 which is
being held in Paris on 16-21 July 2011. This news shows the potential of the Seglin platform to generate drug leads.
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The Business Centre 6 Wool House, 74 Back Church Lane
London, E1 1AF
United Kingdom Company No. 05639690
VAT No. 87207082
Tower Resources (LON:TRP 6.62p / £74.34m)
Tower Resources, the oil and gas exploration Company with operations in sub-Saharan Africa, has recently completed
detailed technical and economic evaluation of the 0010 License, of which it has a 15 per cent working interest.
According to Chairman Peter Kingston, an independent reassessment of the prospectivity of Namibia License 0010 has
cemented its potential as a world class group of oil and gas prospects. The 3D seismic survey has considerably
increased the reserve potential of the Delta Structure and has led to an improvement in the chance of success with the
first well. This well, which is still on schedule for the end of Q1 2010, is expected to have a resource potential of more
than 5bn barrels of oil equivalent.
Trap Oil (LON:TRAP 42p / £76.51m)
Trap Oil recently acquired Reach Oil & Gas for approximately £30m. This acquisition will bring 14 exploration licenses
governing 24 Blocks and part Blocks in the UK Continental Shelf. Reach's group portfolio consists largely of appraisal
assets along with the aforementioned exploration prospects (with a range of risk profiles). This more than doubles the
size of the Company's existing exploration portfolio and near term drilling activity, which also includes an increase to a
15 per cent holding in the promising Orchid prospect that's to be drilled later in 2011. The Company will now focus on
identifying and acquiring producing assets that will provide cash flows to support the prospective drilling programme
with suitable tax synergies.
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The Business Centre 6 Wool House, 74 Back Church Lane
London, E1 1AF
United Kingdom Company No. 05639690
VAT No. 87207082