SMALL CAP MOVERS: Deals and flotations continue to flow

SMALL CAP MOVERS: Broker Finncap ‘in a good moment’ as flotations and deals continue to flow

In a week when announcements of forthcoming flotations continued to flow, broker FinnCap revealed it has been trading materially ahead of expectations.

The City firm said its capital markets business recorded its highest level of quarterly deal fees in the October-December quarter – the third quarter of its fiscal year – and continued to enjoy good growth in sales and trading revenue.

The board now expects total income for the year to top £43million, which would be almost two-thirds higher than in the previous fiscal year.

Broker FinnCap said its capital markets business recorded its highest level of quarterly deal fees in the October-December quarter

The shares were up 19 per cent on the week, helped also by the chief executive and chairman buying more shares after the trading update.

City firms are clearly ‘in a good moment’ as foreign football managers are fond of saying and sentiment in the Square Mile would have been boosted by confirmation of more high-profile flotations on their way.

Car seller Cazoo and Russian retailer Fix Price were the big beasts to announce initial public offerings while in the small-cap world we had ready meals delivery firm Parsley Box and Cyprus-focused Caerus Mineral Resources revving up on the starting grid.

Parsley Box said it intends to give its customers the chance to become shareholders in the initial public offering, which is expected to take place later this month or in early April.

Parsley Box will list on AIM while Caerus said it plans to list on the main market on March 19.

The intention to float follows its acquisition, announced on Friday, of New Cyprus Copper, a company with a number of copper-gold exploration licences in Cyprus.

Elsewhere in the resources sector, Chariot Oil & Gas rose 22 per cent in a week in which the Moroccan authorities committed in principle to supporting the development of the Anchois Gas Development project.

Petroneft was another energy stock winner, rising 33 per cent after it completed its fracking programme of wells on the Sibkrayevskoye and the Lineynoye fields in the Tomsk Oblast, in the Russian Federation.

Initial results from the wells were said to be very encouraging, leading to production increases and opening the door to potential further developments.

Westmount Energy shares went the other way, tumbling by 27 per cent over the week, after drilling results from the Canje Block on Bulletwood-1 in the Guyana-Suriname Basin disappointed.

The well encountered quality reservoirs but non-commercial hydrocarbons.

Westmount holds an indirect interest in the Canje Block through its 7.7 per cent stake in JHI Associates.

Ready meals delivery firm Parsley Box has announced plans to float on the AIM market

Ready meals delivery firm Parsley Box has announced plans to float on the AIM market

Also tumbling was Mosman Oil and Gas, which reported significantly lower oil and gas production rates at Falcon-1, in which the AIM-listed company has a 50 per cent working interest.

The operator of the Falcon-1 well in East Texas has reported a recent increase in water production alongside a fall in pressure at the well. To manage this, the wellhead choke size has now been reduced. The shares lost 16 per cent of their value this week.

Away from the world of mineral resources, investors clambered onto the Futura Medical bandwagon after the company received a cash injection from a fund managed by Atlantis Investment Management.

Atlantis has agreed to provide Futura with £2million in return for loan notes that can be converted into shares at 20p a pop. Futura shares were up 40 per cent this week at 20.25p.

The drug delivery company also entered into a licensing agreement with Co-High Investment Management for the rights to exclusively develop and commercialise Futura’s topical, gel-based erectile dysfunction treatment MED3000, in China and South East Asia.

Co-High will provide funding currently estimated to be up to £4 million for development and regulatory approval of MED3000 in the region. Futura will be entitled to 50 per cent of regional profits from the commercialisation of MED3000.

Another medical company, MyHealthChecked, was obliged to put out a statement after its shares rose on the back of speculation over the weekend that a significant potential contract is in the pipeline.

The personalised healthcare company said it is engaged in commercial discussions with a number of parties for the supply of COVID-19 testing kits, but no contracts have been signed to date.

That did not stop the shares from soaring 62 per cent.