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Havealot - yes I think you are a bit short on research!!
Your post is wrong on several counts. Firstly You are correct they are still well short in meeting current capacity. However, once orders ramp up from multiple sectors plus new products range on stream selling to other coatings companies (!) capacity will be hit sooner than you think.
Your figure of £10m revenue to hit profit is way off the mark. The company have already stated they hit profit at between £7m and £8m.
Also, aerospace applications have completed trials and they are now starting to take orders for a growing number of parts.
There is a very substantial HCP market out there which will now legally have to use new technology to replace it and Hardide are perfectly placed to meet this need.
The future is very bright with a new proactive commercially focused board and a new CEO to be appointed. In the meantime the interim CEO is doing a good job.
Lastly a takeover here is nailed on imho at a price substantially north of this ridiculous valuation.
Win/win
The problem is that it is not just capacity. They are having trouble filling their existing capacity. They have said £10m turnover will see them into profit, however they are well short of this at the moment. I am not sure how much hard chrome plating is out there to replace. Also airospace applications require extensive trials with little volume to follow. What they need is a new contract for a high quantity, small size product, but I am not sure that a product of this type would have used hard chrome plating in the first place because of cost. It is a long time since I did any serious reseach on this Company so I could be wrong here. My holdijgs in this company much reduced over the years. But I suppose things are looking a little better at the moment, but it is all relative I suppose.
Agreed. And what’s more - when and not if - this finally moves into profit amd shows growing sales it will be gobbled up by one of the larger coatings companies. Just a matter of time especially with this ridiculously cheap valuation £4.9m! Seriously? With Hardides advanced market leading technology. All this needs now is scaling up capacity which will be implemented by a larger company with the necessary capex.
Some buying today but I expect this to be much higher in the next 6-12 months min 15p
And this is 10p++++
On 15 March 2024, Innovate UK announced that Hardide was selected for grant funding, "New tungsten carbide electrocatalysts for resource efficient green hydrogen electrolysis (neWCat)
Collaborators:
Hardide PLC
Cranfield University
I can't recall seeing any Hardide announcement on the funding. In any event good news and it all helps. Look forward to more news on customer conversions, growing revenue and getting Hardide to safety.
We've done a fair bit of testing with airbus, 13 years, and about 8 years with Leonardo's. I'm not to sure about other aircraft companies - Not more years and years of testing - surly not!
Per the year end results announcement, "The EU and UK Reach regulations currently have an end date of April 2024 for the use of the toxic hexavalent chromium chemicals used in the production of HCP". The hard chrome plating phasing out in aerospace has been talked about by Hardide for such a long time. Well now the phasing out of HCP has happened when will we see the flood of aerospace orders for Hardide?
Interesting RNS. There was something mentioned a year or two ago re other coating companies. This is a cracking deal - not only are we making sales to competing companies but the first order has been supplied and we've got the whole of the 2nd half to add to revenue which is sorely needed.
Surely, at long last, we have an upward revenue situation. What could possibly go wrong???
26-Mar-24 14:16:55 5.50 26,678 1,467 O
26-Mar-24 12:34:00 5.60 26,678 1,494 O
Omg talk about short horizons! Lmao
Encouraging sales and new product news. Hopefully more to come!
Hallelujah, great to hear sales progress announced today. Look forward to hearing more progress over coming months. #fillupthefurnaces quickly!
With the AGM coming up it would be timely to understand what Hardide are changing to unlock the revenue growth. Refreshed culture, strategies, short term revenue, new partnerships, entreprenuiral drive. Really would be great to hear what is changing to unlock the potential before Hardide simply runs out road.
Don’t be fooled, those two recent trades @ 6.22 marked as sells are both BUYS.
Ex ITM CEO Graham Cooley has increased his stake from 3.1% to 4.14%
Looks like it’s slipped through unnoticed this time. Last week the SP rose on the initial news.
07-Mar-24 13:36:46 6.29 12,361 777.51 O
Looks like a sell but Is my buy.
New CEO will make an AGM statement later this month on the 25th. Hopefully it will be more positive. I’m sure he will want to make his mark. He has a background of business turnarounds and transformation.
Some pretty impressive validation (even more than from Dibs lol) from these stakes by serious folk
does this attractive tech have commercial traction? Really won't take much incremental sales, for positive snowball
In some ways, it doesn't much matter what your average entry price is (within reason!)
it's largely a binary play ...essentially 0p or 50p++
I’m still substantially down, average of circa 9.7p. I thought that was cheap when I bought!
I prefer to use EV to MC as a valuation metric and on that basis it’s currently £4m which, imho, is a snip. Nothing wrong with the company or product. It’s management lethargy that’s been the issue. I think that is finally being addressed now with a more proactive commercial focus.
We’ll see. If all else fails this is a hands on TO target for a bigger coatings company.
You're on to a good 'un
Dr Graham Cooley who recently stepped down as CEO of ITM Power has taken a stake in tiny Hardide.
Hmmmm interesting.
Cannot challenge "illiquid stock" today
It appears to me that the recent dilution can only be blamed on the FD and the company"s financial advisors. Sounds as if the auditors refused to certify the accounts unless the company raised more money.
It has been obvious for a long time that the company needs more financial leeway.
Hardide has a great platform, technology, customers (Airbus, Schlumberger, ExxonMobil, Graco, Halliburton, General Electric) well invested furnaces and delivery capability. I lost trust and confidence in the previous Chairman. Too much hubris, lack of honesty and waffle. I hope the new Chairman can refresh the board, management culture and drive the commercial revenues. Broadly speaking increasingly revenues from £5.5m to £6.5m ensures group is cashflow break even and £7.5m we are in profit with some resilience for customer destocking. An additional £2m of revenue within 18 months and Hardide will be generate a 5 to 10x return from current prices. Flipside is anaemic customer growth, more destocking, emergency equity and massive dilution.
EV here is now around £3m. Yes £3m. Small wonder there has barely been a sell since the placing last week. You’d have to be rather desperate to sell at these going bust prices.
I’m not going to set out the entire investment case, from my standpoint, in this post. But it’s convinced me to stick around and probably add more to average down.
The fact is this company possesses unique and, yes, disruptive technology. Yes I can hear all the counter arguments… never made a profit, poor management, lack of commercial focus, purely R&D Co., snails pace progress. All of those things are true to some extent. But the past is what it is, the Past.
What we have now is a company that is in rather a good place re their technology. It’s unique. It has a very large moat now. No one else can do what they can do. They have no direct competitors who can compete with them on a level playing field with their technology.
It just needs a management team that can unlock the value and potential.
I saw several promising snippets in the recent results that might have gone unnoticed.
I’ll share them in future posts.
One thing I do know is this company is def worth substantially more than £3m. Absolutely absurd when you look at the garbage out there on AIM that’s valued at multiples of that price.
No matter what your view of Hardides progress this is NOT a bucket shop stock with bucket shop placings though the recent placing resembled one with a scandalous 21% discount to the SP. Disgusting IMHO. However, that said, investors in the placing are not, imo, going to be able to shift their shares even if they wanted to. The reason? This stock is extremely illiquid. They simply wouldn’t be able to offload on the market unless they could negotiate an off market bulk sale. And why would you when you have taken the shares at a going bust price?
No I don’t see overhang as an issue here. The issue is the fundamentals. Can they get the sales to drive the revenue back up? I don’t see a lot of scope for further downside here. It’s now a classic recovery play at this price.