Blencowe Resources: Aspiring to become one of the largest graphite producers in the world. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
I've been married a very long time to a wonderful woman.
I would have been separated and ultimately divorced from her if I couldn't cope with volatility.
What a terrible mistake that would have been.
I think - Lol
Bluelight wrote: "My take is dhsc didn't take all the volume they were contractually committed to, and ncyt are taking legal action to basically take or pay, but we are all unclear."
If that is the correct explanation, then Novacyt would probably have a strong case from a contractual point of view. Perhaps there is a lot of money potentially at stake in this dispute.
However, is it wise for Novacyt to refuse to make a short-term monetary concession to their biggest customer, when they are hoping to have a continuing long-term relationship with the NHS in the supply of diagnostic tools to hospitals? Furthermore the announcement of the dispute in the latest RNS has caused an immediate 40% drop in Novacyt's share price which equates to a £200 million drop in its market capitalisation. That might turn out to be a temporary drop if the share price should recover, but a lot of shareholders will have sold at the latest price because they can't cope with the volatility, in which case for them the loss in their portfolios becomes permanent. Is that worthwhile in return for, say, a once-off £20 million revenue gain should the dispute eventually be resolved in Novacyt's favour? Perhaps the company wasn't expecting such a massive reaction to the RNS, but it does make me question its CEO's judgement in this instance.
Just a reminder to all the gloaters out there who hold other diagnostic stocks. If it is the case that DHSC didn't hold up their end of the bargain then it is right and proper that GM doesn't presently air this publicly but does fight his corner. If he doesn't, any1 with a contract beware. That's why the other stocks are tracing back a bit also, it effects us all.
B2H, yes, think so, you are right, unchecked boxed not relevant. I got it wrong. It looks as though the first part and schedule (including KPIs) were drafted specifically for relevant discussions from a proforma that they add with "X" in some sections not others. I
What the hell can they be liable for if test kits were acceptable & machines delivered on time unless it is machine performance/usage issues & why couldn't the RNS be more specific? Its quite clear they would have had regular KPI reports, monthly & 2 weekly meetings on performance, so how could they have been negotiating at end of Jan if it has ended in a dispute?
Rant over with apology to all.
Thank you very much
the bid stats link is
https://bidstats.uk/tenders/2020/W47/739312011
the link (within the bidstats link) for the contract is
https://atamis-1928.cloudforce.com/sfc/p/0O000000rwim/a/4J000000kEFW/0a.XEpAnsXhWLPDFwBk_JAjjG7TOqEVnG58sfxOiFmw
ak_gabba - can you please copy paste a link or at least the relevant bits for lazy pieces of **** like me who can't be bothered googling?
I agree and that would be a particularly difficult situation. Do you stand your ground and insist that current commitments are honoured at the risk of souring the relationship or show flexibility to maintain goodwill for the future? It's a tough call!
try2buylow and B2HS2L,
Not knowing exactly what the dispute is makes it difficult however you can still take a look at the clauses
21. Dispute resolution (schedule 2)
It's a worthy read. I won't cut and past it all as you can read it from the pdf however the TU stated in dispute. Not mediation. Various levels for the dispute to move through. Unsure how many levels however the TU from the CEO leaves me to assume it's beyond level 1.
5 business days on reaching the final level when the dispute will be deemed exhausted unless agreed in writing.
Then off to mediation. Commencing within 28 days of confirmation of mediator.
Section 19 of schedule 1 is also an interesting read and I suspect it would have been used for PROmate to be included in the contract.
My take is dhsc didn't take all the volume they were contractually committed to, and ncyt are taking legal action to basically take or pay, but we are all unclear. Penalty will be on dhsc in effect
Just hope there is no financial penalty regarding reason for sp drop.thoughts anyone.
@Wilson63
You can't, no matter how you do the calculation it totally defies all logic:-
Sales 179m
Ebitda 94m
Cash at year end 219m
Equal a Price target of £ 5.70
That’s a mcap of £ £400m
IF this is reality then Novacyt should put the business up for sale, call it a day.
try2buylow
The Authority’s right to claim damages.
Look at bottom of page 87:
"For a performance below 85% across all KPIs:"
try2buylow
23 Exit and Service Transfer [unchecked box] - (only applicable to the Contract if this box is checked) ?
wilson - thanks, I don't spend as much time as I might reading stuff here.
I've read the redacted version of contract available as a footnote on bidstat announcement https://bidstats.uk/tenders/2020/W47/739312011
There aren't any staff transferred or managed between parties - each do their own staff & performance. The contract is structured for delivery to be reliable with warranty function & regular meetings to manage the relationship. We can see from the download of sales transactions available from a FOI request that there was delivery by NCYT in Oct & Nov was huge. Reagent has a shelf life & there is provision for DHSC to return stock to Primer Design.
There is a KPI section on page 86-88 but it is wholly redacted. Oddly enough p87 had been actually been replaced on when the original was uploaded. They had monthly reports on KPIs within 7 days There is a section on consequences of falling short on KPIs - I wonder how they could do miss KPIs if they delivered huge numbers of kits without function issues. Perhaps the issue is about machine delivery & their function.
The Authority’s right to claim damages
3.4 The Parties acknowledge and agree that if in the event performance of the Services and provision of the Goods by the Supplier continues to fail to meet the KPIs following implementation of a Remedial Proposal, as well as its right to terminate pursuant to Clause 15.4 (Term and Termination) of Schedule 2 (General Terms and Conditions), the Authority may claim for direct damages incurred as a result of such compromised performance in accordance with Clause 13 (Limitation of Liability) of Schedule 2 (General Terms and Conditions)
There is an interesting clause under Exit and Service Transfer that Primer Design shall, within three (3) Months after the Commencement Date, produce an Exit Plan based on the principles set out in Schedule 12 for the orderly transition of the Services from the Supplier to the Authority or any Replacement Supplier in the event of any termination or expiry of the Contract
& Primer Design is free to release its capacity earmarked for DHSC to other customers only after 8 weeks after the agreement failing so they must have been constrained most of Q1 in what they could sell elsewhere.
Bluelight you are correct if I had shares in British lft companies I'd be furious re the latest award to innova.
On another note, it's interesting the other covid plays havent pulled back from their high valuations yet. If the DHSC is playing hard ball, and those guys are in a much more price competitive environment, then it stands to reason their realised margins will be much lower than they are hoping for, and potentially volumes lower too. Whilst we are oversold, those guys, particularly the one who shant be named have got a very big downside if things dont work out perfectly for them.
Forget RNS @ a £10m sale, I personally want to see an RNS for a sale of £1m+ (or significant relevance) . No point comparing our 'news to market' to Astrazeneca or ASOS or any other medium/big boy. The fact is Novacyt is in the treacherous AIM (the Mos Eisley in sci-fi speak). I've held on to the belief that all this "playing it cool" "no news is good news" "keep it schtum" HAS TO BE part of a master plan but (and it pains me to say this) i'm f'in sick of how the BOD are handling its shareholders. I've been balls-deep in Nova for a year now and while they did wonders for the SP they've done next to jacksiht to protect the SP/shareholders! What idiot of an AIM company feels a £10m sale shouldn't be RNS'd but instead just tweeted out like some spotty little teenager is in charge? IT'S WRONG AND NEEDS TO STOP NOW! They have the money so pay proper PR (understanding social media algorithms is complicated). When they do good they need to shout about it (unlike some co's that shout about things which aren't even tangible) They need to be smarter than they have been, inform the right way, play the AIM game a bit. It pain me to say all that but they deserve it.
Friday left me so sick I've been unable to comment instead tried my best to keep control mentally so I don't let it harm me psychically (last 3yrs have been hard).
Having said all that and to balance my feelings I strongly believe the drop to £6-7 was already stupid so where we are now is just dumb. Sure, the RNS sucked balls but anyone would think we are being sued by the Gov or something. I strongly believe the company (apart from comms) is absolute gold and will become a major diagnostics player in the near future. I noted the strong international sales and Promate being the only specific testkit mentioned in regard to DHSC (they've used plenty others). Our future LFT pipeline, our partner links, all our kit in place etc . I think we will be in a better place once we get outta this lull.
So here's where i'm at, money where my mouth is. Purchased today:
09:20 - 1900 @ 418.00 - £7,953
13:57 - 1023 @ 399.00 - £4,093
14:08 - 1062 @ 397.74 - £4, 235
I've about another £10-15k ready if things get any more stupid or we get a positive update but will sit and watch for now. My position remains to HOLD (for dear life) for the foreseeable.
Wish all my fellow LTH's all the best. GLA
Bluelight,
Spot on. Any self respecting company would always provide a revenue forecast for the quarter and the year. Even in difficult times. Add the caveats for the forecast, no worries.
The fact that Novacyt didn't and doesn't is quite unprofessional in my view.
How can you make any business decisions if you don't know where your heading. Crazy.
MS
Yes I totally agree, but I also feel that the company have gone through bigger adversity than this over the last year and with that in mind I think the expectation of positive news flow is too much. I hope they do though- naturally
They were good enough with communication when they wanted our support last year.
Lloydboy I don't see anybody wanting the company to Rns everything, but as a strong supporter of the company over the last 13 months I don't see how it would be difficult to put something positive out not accompanied by rubbish financial news a la the Ukrainian 10 mil contract they tweeted, big contract for a growing aim company don't you think?
Good example, appreciate that Chris
It is indeed an unusual market, but it hasn't stopped the likes of Roche and other covid updates having production and sales estimates included. Anyway, i guess we agree to disagree on that. it holds though (for me), that if they do provide an update on sales forecasts and an operational update on how they see us progressing in coming years, then we will provide a platform for the shareprice and allow it to achieve its fundamental value (whatever that be). We all know its cheap here, but it is the comunication (or lack of detail in said communication) that has put it in this position. It has to improve, we cant get smashed everytime they do an RNS, that just shows something is clearly wrong in how it is being done.
Bluelight, here is an example of another diagnostic player giving no 2021 outlook;
https://diasoringroup.com/sites/diasorincorp/files/allegati_pressrel/pr_diasorin_-_fy_2020_results.pdf
"Given the uncertainty of the macroeconomic and health context expected in the forthcoming months,
DiaSorin is unable to provide a guidance for the full year"
Incidentally, they bought luminex a few weeks later for $1.8B