Proposed fundraising

DP Poland is proposing a £20.5m equity raise to fund future growth which includes Domino’s Pizza Group planning to become a strategic investor (via a direct £11m subscription). Under a new leadership team, DPP has been transformed to capitalise on the market opportunity ahead. It is targeting 200 stores (vs 116 presently) by FY26 and transitioning to a capital light / franchise led model. Delivering on the plan will result in significantly higher profitability and market value. YTD trading is st

Hybridan Small Cap Feast - 16 Jan 24

16th January 2024 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you 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 obje

Delivering an excellent YE update

An excellent FY23 update today, and management is upbeat about 2024 prospects. LFL’s in Poland grew by a strong 20% with momentum accelerating to 27.5% in Q4. Crucially this was almost entirely volume driven, with average weekly order count up by a stellar 19% to >730. Per guidance, we make no change to our FY23 EBITDA estimate - inflection into positive profitability. We also keep FY24 numbers unchanged. The shares have had a strong run last 6m (+50%) but we remain upbeat on the back of today’s

Strong trading update – transformation continues

Another positive update from DPP, reinforcing our conviction in the new CEO and direction of travel. Q3 LFL’s amounted to a strong 14% and accelerated to a standout 35% in October. Significantly, this is virtually all order-count driven and reflects favourably on the volume led strategy to drive store profitability. We make no forecast changes but view the update as supportive of our belief of a ramp up in EBITDA, FCF and transition to a franchise led model going forward. Overall, the update sho

New NED - Domino’s experience strengthened on the Board

Further positive news today - proposed appointment of a high calibre NED. Subject to normal due diligence, Stoffel Thijs is expected to join the board on 1st January 2024. This is another strong appointment and accretive to the investment case given Stoffel has 26 years of Domino’s experience via various leadership roles in different European markets. Notably, building a corporate Domino’s store base in the Netherlands, President of Domino’s France, and more recently, CEO of Domino’s Pizza in Ge

FY23 on track with further strategic progress

Interims show DPP is in good shape and responding positively to the new CEO’s actions. Order count is up (despite a soft macro backdrop), LFLs are strong and the proportion of stores transitioning to profitability is materially higher vs 12m ago. Strong summer trading in Poland and an easing of cost pressures underpin our decision to make no forecast changes FY23 being an inflection point in terms of moving into positive EBITDA (pre-IFRS16 basis). Overall, these interims are positive and support

Hybridan Small Cap Feast 28 07 2023

Announced ITF 12 July: Substrate Artificial Intelligence, an artificial intelligence company based in Spain that creates, buys and scales companies around AI in diverse sectors such as fintech, agritech, energy, human resources, and health, intends to join the Access Segment of the AQSE Growth Market. Announced ITF 6 July: Blackpoint Biotech plc, a medical cannabinoids company established to fulfil gaps in the medical cannabis market by creating products that provide fast onset of action and acc

Hybridan Small Cap Feast 21 07 2023

*A corporate client of Hybridan LLP ** Arranged by most recent first *** Alphabetically arranged Dish of the day Joiners: No joiners today. Leavers: Star Phoenix Group (STA.L) has left AIM. What’s cooking in the IPO kitchen?** Substrate Artificial Intelligence, an artificial intelligence company based in Spain that creates, buys and scales companies around AI in diverse sectors such as fintech, agritech, energy, human resources, and health, intends to join the Access Segm

H1 update – showing continued LFL strength

Further evidence of improving fortunes at DP Poland in the form of a positive H1 trading update. LFL sales growth in the period was a strong 18%, led importantly by +11% order count. So further evidence of the new CEO executing on the top-line strategy to ultimately make the stores profitable and thus attractive to potential franchisees. The update also references easing of inflationary pressures and adding to the store footprint. We make no changes to current year forecasts but introduce FY24 e

Positive FY23 trading; revised FY22 guidance

A brief trading update from DPP today shows that the strong trading / LFL’s seen in Q1’23 has continued into April. We welcome this sustained momentum as well as further reference to inflationary costs around food and energy costs abating, albeit this is slightly tempered by no easing of labour cost pressures. Following the near end of the FY22 audit, management use today’s update to lower guidance for FY22 EBITDA. In absolute terms it amounts to a modest c.£0.6m as we lower our pre-IFRS16 EBITD

Strong Q1 LFL’s; rebased forecasts; equity story intact under new CEO

Today’s Q1 update signals a strong start to FY23 with the new CEO having a successful impact. This is best reflected in Poland LFL’s of 19.4% and Croatia 15.7% vs Q1’22. It is also encouraging to see some respite to high food cost inflation, with first signs of pressures reversing at the start of Q2. We expect good top line momentum to be sustained for the rest of FY23 but pull back our EBITDA forecast to better reflect a one-off TV campaign to support market share gains and a higher cost base e

YE update – another positive staging post for new team

The YE update shows that strong LFL and operational momentum was sustained in H2. Overall FY22 system sales grew by 20% and LFLs by 21%, led by volume/mix as the new CEOs actions begin to take effect. We make no forecast changes, but the positive H2 profitability trend cited is an important inflection point in the context of DPP now moving to sustainable profits. A well-capitalised balance sheet also means expansion is firmly on the agenda. The key point is that international evidence shows once

Accelerating LFL’s – get a pizza of the action

Interims show DPP has executed strongly in H1 (LFL sales +24%) and managed a tricky inflationary environment. The new CEO is already having a positive influence with LFL’s accelerating over July/Aug to >30% led by >15% volume growth. The upcoming FIFA World Cup is expected to be an added stimulus. Like many Leisure stocks, we temper FY22/FY23 EBITDA by £1.3m/£0.4m to reflect cost headwinds but also a conscious management decision to prioritise sales/market share growth. This should not detract f

Hybridan Small Cap Feast 29/07/22

29 July 2022 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you 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 objective

Well positioned for future success

Strong performance against tough market conditions

LIBERUM: The Liberum Leisure Digest: NLW increase - pricing power is key

Domino's Pizza - Growing the base

Domino’s Pizza Group’s (DOM’s) new CEO has set an ambitious long-term growth target, including an acceleration in its net store opening programme. With better alignment between the company and its franchisees, management believes DOM should be capable of generating improved profit growth, versus that achieved in recent years, and potential higher returns.

PROGRESSIVE: Vertu Motors: Traction control

Vertu is the fourth largest automotive retailer in the UK, with 188 sales outlets and a track record of cross-cycle growth, principally through businesses it has acquired, funded by equity, debt and most importantly cash generation. Vertu operates across the entire vehicle lifecycle, including new and used vehicle sales, and vehicle servicing, repair and parts. Service and repair is a 40+% gross margin repeating business. With economic headwinds, the transition to electric vehicles, recent overs

Pinewood Technologies (PINE LN) - Driving growth in automotive software

Pinewood’s transition to a pure-play automotive SaaS business is now largely complete. Today we introduce summary forecasts out to FY26 and reiterate the investment case. We see significant opportunity for Pinewood to grow its user base in the UK and internationally whilst generating high EBITDA margins and cash conversion. With a 24.5p special dividend embedded in the current price (payable Q1/Q2), the effective price today is 12.3p. Based on the Group’s FY27 target of £27m EBITDA, we estimate

Marks & Spencer+ (MKS, House Stock at 255p) - 7Y FS HSBC UK tie-up– another brick in the wall

Zeus Top Picks for 2024 - 2023 review and outlook for 2024

On 9 January last year, we set out our ten top stock picks for 2023, for what turned out to be another relatively poor twelve months for UK equities due to two wars, stubbornly high inflation and further tightening of monetary policy. This was even as other major markets, such as the US, largely recovered in the year. In the 2023 calendar year, the AIM All-Share index fell 8.2% and is still 42% off its 2021 high. From the release of our 2023 top picks note, the average total return (assuming div

React Inititation of Coverage

React Group is a well-managed, growing UK services business with a high degree of recurring revenues (c87%).

PROGRESSIVE: Zoo Digital: Recovery underway and a significant contract

Today’s trading statement from ZOO highlights a ramp-up in demand following the end to the industry-wide strikes of last year. ZOO struck a note of caution in its January update regarding the timing of orders. However new productions are starting to translate into a healthy order pipeline, with a good recovery in revenue anticipated in H1 FY25. The update guides to revenue of at least $40m for the year to March 2024, ahead of our estimate at $36.8m. We have improved our adjusted EBITDA loss marg

LE: Snapping the Catalog: Features, Focus Lead the Way; Reiterate Buy, $14 PT

We are reiterating our Buy rating, $14 price target and projections after reviewing the company's early summer catalogs for April 2023 and 2024. We remain impressed by the shifts in the catalogs, from a deeper focus on features and story telling, impressive gains in swimwear and related accessories, expansion of categories such as outerwear, totes and lifestyle apparel, shifts in footwear that we believe will presage the relaunch of the category as a licensed item and overall similar pricing. We

Allenby Capital - Nightcap plc - Interims

Nightcap’s interims for the 6m to end December 2023 were in line with expectations, as such, we make no changes to our forecasts. The number of bars at the period end was 46 up from 36 a year earlier – the expansion driven by the June 2023 acquisition of Dirty Martini. The portfolio expansion led to a year-on-year revenue increase of 42% to £33.4m and 5% growth in underlying EBITDA (IAS 17) to £2.1m. Post period end the Company announced the acquisition of Piano Works funded by a £1m equity rais

Judges Scientific+ (JDG, House Stock at 11,600p) - FY23A - solid organic order book

ME Group - Modernising and growing the estate driving growth

During 2023, ME Group commenced the deployment of its next generation photobooths, which are integrated with the group’s newly developed proprietary software, gained market leadership in the Japanese photobooth market with an acquisition, continued to roll out laundry units with existing and new location partners, commenced a share buyback programme and gained entry into the FTSE 250. 2023 was a year of significant strategic and financial progress, with sales up 15%, EPS up 31% and net cash main

Tasty - Trading update and restructuring plan

Trading conditions remained difficult in 2023, impacted by intense cost-of-living pressures, transportation strikes, and significant inflationary pressure on labour, food and utilities. In response, Tasty implemented various efficiency measures which helped narrow FY23 EBITDA losses to -£0.9m (FY22A: -£2.7m loss). With the economic environment remaining challenging, however, Tasty intends to implement a restructuring plan (funded by a new £750k loan with potential for conversion), which will inv