Please find below our weekly update covering themes that we feel that are of interest to investors and participants in the small and mid-cap TMT sector as well as commentary on recent newsflow. The cost of Allenby Capital's research on individual clients is paid for by our research clients.

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Allenby Capital TMT Update - 20.04.20 (BBSN.L, ECSC.L, GFIN.L)

Brave Bison Group plc* (BBSN.L, 0.975p/£6.0m) 
Finals: Channel focus; platform diversification (15.04.20)
Note published

Allenby Capital comment: FY19 at Brave Bison, the social video company, was dominated by Facebook’s changes in content policy that resulted in BBSN’s four largest pages being demonetised but the company increased APAC revenue by 90%, YouTube channel management services by 66% and there was substantial growth in Snapchat. All the Facebook channels have now been remonetised. BBSN has also retained its largest contributors to YouTube and has undertaken branded content and influencer campaigns for a number of multinational clients. The new management has focused resources on a smaller number of channels, rebranded and re-oriented as necessary, and diversified onto other platforms. The emergence of COVID-19 and the postponement of the Olympics will impact BBSN’s growth ambitions for its JAPAC division and there is the wider question for global marketing spend. On the plus side, more digital content is being consumed at home and BBSN remains well capitalised. Forecasts remain under review.

* Allenby Capital acts as Nomad and Broker to Brave Bison Group plc.

ECSC Group plc* (ECSC.L, 67.5p/£6.1m)
Placing: Additional resources to capitalise on cybersecurity demand (17.04.20)

  • Placing to raise £0.5m at 55p/share with new and existing shareholders.
  • The additional funds will be used to ensure that the company is sufficiently well capitalised to take advantage of longer-term growth opportunities once the COVID-19 situation stabilises and to strengthen the balance sheet amidst the uncertainty caused by the COVID-19 pandemic in order to reassure current and prospective clients.
  • Forecasts currently under review.

Allenby Capital comment: The shift to remote and cloud-based working necessitated by COVID-19 has increased the number of cybersecurity threats and will drive demand for ECSC's Consulting and Managed Services offerings. ECSC is well placed to capitalise on this opportunity given its considerable experience and expertise and the additional funds provides the company with the necessary additional resources.

* Allenby Capital acts as Nomad and Broker to ECSC Group plc.

Gfinity plc* (GFIN.L, 1.30p/£7.0m)
Additional events: Demand for esports content continues to expand (20.04.20)

  • Gfinity selected by premier cricket broadcaster Willow TV (owned by the Times Group) to design and deliver 'The eCricket Challenge', in partnership with Betway (17.04.20). The TV series involves well-known cricketers competing against each other in Cricket 19 in five-over matches. The pre-recorded shows, hosted from Gfinity's arena in Fulham premier in the US and Canada each Sunday, starting 19 April.
  • Players include Jofra Archer, Stuart Broad and Liam Plunkett (England), Kieron Pollard, Jason Holder, and Andre Fletcher (West Indies) and Glenn Maxwell (Australia).
  • Gfinity will also operate the inaugural ePremier League (ePL) Invitational tournament (20.04.20). The knockout tournament takes place this week and will see Premier League footballers representing their clubs and playing EA Sports FIFA 20, with a live final to be aired on Sky Sports on Saturday 25 April 2020. The prize fund from the tournament will be donated to the #PlayersTogether initiative, which was created by Premier League players as a way of generating funds for the NHS.
  • Players include Trent Alexander-Arnold (Liverpool), Todd Cantwell (Norwich City), Ryan Fredericks (West Ham United), Raheem Sterling (Manchester City) and Wilfried Zaha (Crystal Palace).
  • Finally, Gfinity hosted the third F1 Virtual Grand Prix on 19 April. The event using the Shanghai International Circuit in China, included seven current F1 drivers as well as other sportsmen such as Ian Poulter, Thibaut Courtois and Ciro Immobile. The series has demonstrating good audience numbers. The second event (05.04.20) had 476k peak viewers (Source: Esports Charts), up 20% on the inaugural event.
  • Forecasts currently under review.

Allenby Capital comment: Gfinity continues to work with sports rights holders, publishers and broadcasters to deliver new content and virtual formats given the ongoing absence of live physical sporting events. The events also provide an opportunity for fans to engage with players/teams in a different way. 

* Allenby Capital acts as Nomad and Broker to Gfinity plc.

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Allenby Capital "paid for" research services

The changes initiated by MiFID II has had far reaching implications on both the quantity and continued availability of research on smaller cap companies, including those within the TMT sector. We would therefore remind interested companies that Allenby Capital can offer a  "paid for" research service for those corporates that wish to retain an alternative and authoritative source of research that can be accessed freely by the entire investment community. If you would like further information on this service please contact d.johnson@allenbycapital.com.

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