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It’s good to read statements like “a number of substantial contracts and renewals” and “operational performance has improved markedly” in the context of the Capita businesses that have only been under the ADVT wing for 5 months. Furthermore, results for 12 months to February 2025 are expected to be well ahead of expectations.
Having largely skimmed these results, there doesn’t seem to be a lot not to like - of course the wage bill has increased substantially in view of the new businesses on board, and it will be interesting to monitor how the number of staff changes over time.
Meanwhile, cash balance of £78.7m and SAA ‘investment’ now worth £19.2m represents £98m of today’s MCAP of £170m. Plenty of cash to pursue further investment opportunities. It’s perfectly fine to be deferring dividends in favour of capital growth - I’d be worried if VM was talking about imminent dividends tbh
Certainly glad that I decided to hold tight here. It’s one for the long term hold imo
Recent interview with Vin Murria well worth watching.
https://www.youtube.com/watch?v=G257dlrOBXg
Excellent potential with Vin Murria and team at the helm for sure.
80%+ held by instis since IPO, many of whom will have made significant profits on VM’s previous vehicles.
Spotted this tip elsewhere. Thanks x54v!
It does have potential, though I see they are now competing against big fish for acquisitions at a reasonable price. It's also encouraging that Baillie Gifford are on the shareholder list though their performance is dire these days!
The share price is quiet for now and holding firm, but there are plenty possible future catalysts which might drive it higher.
Further acquisitions are highly likely. VM is well known for these and her prior successes with Kewill, CSG and ASW were in part down to a focussed acquisition strategy. According to the trading update on Jan 8th:
“M&A is a core part of AdvT's strategy and there has been a notable increase in inbound opportunities. The Board will continue to evaluate these against its acquisition criteria.”
so it’s only a matter of time before a further acquisition is announced imo.
The existing businesses are bedding in as planned:
“AdvT's performance for the six months ended 31 December 2023 aligned with the Board's expectations.”
but VM will be looking to improve performance in each of them:
“Avenues for deploying financial and operational resources and investments to enhance the organic growth of AdvT have been identified.”
so there is scope here for future news releases pertaining to improved performance.
Lastly, the shares are very much under the radar at the moment. Increased coverage will come in time I’m sure as investors pick up on the growth and acquisition story. However there is also the possibility that a well-known tipster / tipsheet will cover ADVT. The editor of SCSW for example states that he “has known Vin Murria for many years”, and the tipsheet covered CSG and ASW historically fairly frequently.
https://www.scsw.co.uk/search/?query=vin%20murria&page=1
The share price is still only just above where VM bought in 3 years ago, so it continues to present a great long term buying opportunity imo. I have confidence that in the months and years ahead that ADVT will be a different beast entirely with a much larger market cap and share price. Watch this space!
Yes, you’d think they’d pick up that the shares are no longer suspended from the fact that they’ve been trading again since the 10th.
Thanks! It’s incredible that they should have got something as basic as this wrong - and then effectively ignore the fact that there has been trading ongoing since 10th January (plus my enquiry)
Yes, just a Barclays error. The shares have been available to trade again on AIM since the 10th on both Hargreaves Lansdown and IG platforms.
Cancellation of the shares on the main market and re-admission of them simultaneously on AIM took place as was suggested in the RNS on Dec 5th.
“‘Proposed cancellation of the Company's Ordinary Shares from the Official List and proposed admission to trading on AIM
AdvancedAdvT Limited (LSE: ADVT, the "Company") intends to request the Financial Conduct Authority ("FCA") to cancel the standard listing of the ordinary shares of the Company (the "Shares") on the Official List and to request the London Stock Exchange to cancel the admission to trading of the Shares on the main market (the "Cancellation").
The Company will apply for the admission of the Shares to trading on the AIM market ("AIM") of the London Stock Exchange ("Admission"), such that Cancellation and Admission will take place simultaneously.”
I use Barclays’ investor platform, and they are still showing ADVT as Suspended. Having spoken to them this morning, they point to the 2nd RNS issued on 10th January which states that certain share types have been cancelled - hence their suspension. I pointed out that shares have indeed been traded since that date, and even today, but to no avail.
I phoned ADVT’s Investor Relations firm and left a message this morning, but no response yet.
Can anyone shed any light? Is it simply a Barclays admin error?
Continued overall market weakness dragging valuations down a good thing for ADVT. As Crux recently put it:
"Paradoxically, the more difficult the economy, the better the odds of finding the bargain needed to kick off “the investment story”."
https://moneyweek.com/buy-uk-small-and-mid-caps
The strong position ADVT is in was also highlighed in the Interims in March:
"With a strong cash position which exceeds GBP100m, we have a clear advantage in against a backdrop of market uncertainty. Whilst the cost of servicing debt and its availability have become major challenges for other investment vehicles, our cash reserves offer a unique, attractive alternative and positions us well to execute on our strategy. This financial strength provides flexibility and the resources to capitalise on opportunities, navigate the challenges that may arise, as well as being an attractive proposition to potential target businesses."
Vin Murria continues to wait patiently with a hefty cash balance ready to pounce when the right opportunity presents itself.
No probs Fishcakes47.
Yes, if VM can replicate her previous success then there is a lot of potential upside here. All her prior listed vehicles were multibaggers.
Some interesting backgound here:
https://archivesit.org.uk/vin-murria-2/
Thanks, x54v. A really great summary and I appreciate you taking the time to reply.
Give it is a speculative shot, it is only a ~3% holding for me, however I am tempted to up this slightly give the current SP.
This could be an exciting share once a purchase is announced.
This is covered here from 1:17:00
https://youtu.be/FexUObmgv8Q
So usually 2 years, but the company can approach major shareholders requesting extra time if it thinks there is still a good opportunity of a target company being found. 2 years has recently passed so presumably VM has spoken to the main instis and they are happy for her to continue her search.
With regards cash outflow, there is an estimate of a max of £500k per annum. The interest on the £103.4 million cash currently held will easily cover this and more, so the cash balance should increase over time.
“Ongoing costs and expenses incurred in connection with seeking to identify acquisition opportunities (excluding any project specific costs incurred in pursuit of an acquisition opportunity) are estimated to be no more than GBP500,000 per annum.” - from Final Results Oct 22
The current SP of ADVT is 77p. Against that it has 77.6p cash in the bank and SAA shares worth a further 15.3p. There is the upside potential from an acquisition and also the possibility of bids for SAA.
So:
- Solid upside (to NAV) should a target not be found and
- Very significant potential upside should VM repeat what she has successfully done with Kewill, Computer Software Group and Advanced Computer Software.
Is there a timeframe in which a company has to be found, failing which the “fund” would be evenly split?
Assuming the SAA investment doesn’t bomb or cash held isn’t burned, this would suggest a return regardless of a company being found or not, at current SP.
“A proven software strategy
AdvancedADVT (LSE: ADVT) raised money at 100p to allow seasoned software investor Vin Murria to acquire software businesses and improve them. Murria has had three successful iterations of this strategy at Kewill Systems, Computer Software Group and Advanced Computer Software Group. She raised money and invested £16m herself at 100p per share.
Today the shares languish at 71p and the firm has around 95p per share in cash and shares. Paradoxically, the more difficult the economy, the better the odds of finding the bargain needed to kick off “the investment story”. The shares could bounce by 50% or more on a deal, and would return 95p-plus in the unlikely event that no deal is found. It’s a small company, but one widows and orphans could readily invest in.”
https://moneyweek.com/buy-uk-small-and-mid-caps
Results confirming 103.4m in cash vs 100.6m mcap.
NAV of 95.6p vs 77p share price.
So more cash in the bank than the market cap and 12 million shares in SAA thrown in for free.
A strong position to be in, waiting with a tonne of cash for the right opportunity to present itself as markets continue to decline.
https://investegate.co.uk/advancedadvt-limited--advt-/rns/interim-results/202303140700058169S/
Very strong recent momentum at SAA. Another bid on the way?
ADVT yet to move to reflect the strength in SAA. NAV now around 96p vs the 81.5p current share price.
If there is a premium bid at SAA there could be a decent move ahead. And of course there is the chance of an acquisition as well. Surely Vin Murria has something lined up by now.
I noticed todays volume to be unusually high normally it’s between 20-100k it’s 21million
Even when the take over talk started volume only reached 8m
Maybe somethings about to go down
The share price seems to have found a base around the 70p mark. Perhaps there has been some institutional buying in the background.
The company is in an excellent position with a hefty cash balance and opportunities much cheaper than they were several months ago.
"We are now seeing acquisition valuations falling against the macro-economic backdrop and are in a strong position with a pipeline of opportunities and GBP104m of cash to support our strategy."
Very much under the radar at the moment and a good opportunity to buy at the lows.
ADVT is in a strong position here, with over £100m in cash ready to deploy as markets fall and valuations reduce.
In fact the further markets fall, the better a position the company is in with the ability to pick up companies much cheaper than it could several months ago.
"We believe that our strong cash position, the current economic downturn combined with our disciplined and patient approach, will put us in a prime position to execute on our strategy."
https://uk.advfn.com/stock-market/london/advancedadvt-ADVT/share-news/Advancedadvt-Limited-Final-Results/89296533
A decent safety net too with a cash balance (£104m) greater than the market cap (£93m) and the knowledge that Vin Murria committed £17.5 million of her own money here at 100p on IPO.
Indeed a move back up to the IPO price from the current 70p mid would be 43%. And Vin Murria will be looking for a multiple return from her buy in price.
Whilst the attempt to buy SAA wasn't successful, Vin Murria has a long history of success and her last two listed companies returned shareholders 10x.
https://s26.q4cdn.com/993376269/files/doc_downloads/2022/05/Investor-presentation.pdf
NAV 96.3p here currently on today's move up at SAA on strong results.
A bit of a recovery in the price following the Crux buying.
Still below cash here and way below NAV.
If the deal fell through and the SAA shares were sold at a discount, say at 150p, then ADVT would hold a cash balance of 92.4p per share. A decent amount of upside from the current 78p were Vin Murria to call it a day with ADVT.
Certainly in the dark for a good long time with no hints whatsoever. It’s all just a guessing game really. Hopefully all will be revealed soon.
SAA also moved up late in the day today.
I think there will have to be a fundraise unless there is a takeover involving only paper. And even then we will see dilution. I assumed Crux had been adding because they believed there will be an issue of shares to existing holders. That was an additional reason I took the ADVT position. Let's face it, we are in the dark and can still only guess! I don't think we will be too disappointed though.