Share Talk Weekly Small Cap Movers & Shakers, Saturday 26th November 2022

A round-up of some of the market’s major risers and falls over the past week in London.

New Zealand’s East Imperial has had a difficult year, but it rose higher this week after the appointment of a US bottling company to meet its growing stateside demand.

According to the maker of “ultra-premium beverages”, Lion Brewery, based in the US, will bottle all its range, including its Mombasa ginger beer, grapefruit tonic and Yuzu lemonade, starting in 2023.

It stated that this will lead to significant logistical and capital savings, as well as reducing expansion costs. This is a key part of its plans to increase profit margins, as well as give the flexibility to respond to demand. The shares rose 14% to 2.79p.

Real Goodfood was another London AIM riser, rocketing 51% to 1.75p after it received additional funding.

According to the food manufacturer, Hilco Private Capital provided the money for 12 months. It also supplements its £6.3 million facility with Leumi.

Mike Holt, the executive chairman, stated that he was delighted to receive new funding to support RGF’s radical reform. This is meant to lower costs, preserve revenues, and preserve the intrinsic value of the group. Funding is a growing topic for small-listed companies.

Deepmatter was the leader of the fallers, sinking 60% after it announced its plans to delist AIM following discussions with potential investors and shareholders over long-term financing.

According to the digital chemistry data and software company, a private limited company would offer greater capital-raising opportunities. Its major shareholders also agreed.

The theme of cash raising was also the focus at Applied Graphene Materials. It stated that it was launching a strategic review after being unable to raise equity finance because of the difficult stock market environment. The news brought down shares by a fifth.

Discounts can be severe even if companies are able to raise funds.

Take Osirium Technologies. It fell 32% to 2.7p after it received £1.53million in a placement. This was for working capital purposes.

It is a cloud-based cybersecurity software company that issued shares at 2p, with directors contributing in £255,000.

Genedrive, a health diagnostics company, was another victim. It fell 23 percent to 9.7p in annual losses. Revenues also dropped.

The group reported a loss in sales of £4.7million, compared to £690,000 the year before.

David Budd, chief executive, stated that, despite the financial difficulties, the group had made significant progress in pharmacogenetics and had the chance to lead in the establishment genetic testing in acute care.

De La Rue’s disappointments continued, with the banknote printer falling 21 percent to 78p after another warning.

The actual interim profits fell 46 percent to £9.3million in line with July’s guidance, but the guidance was lower than anticipated for the full-year, which really scared investors.

London’s small-cap indices did well despite the fallers. The AIM All-Share was up 0.8% to 844, and the AIM 100 was also higher. However, they were again comfortably outperformed once more by Footsie.

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