Stefan Bernstein explains how the EU/Greenland critical raw materials partnership benefits GreenRoc. Watch the full video here.
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The placing isn’t to pay for the write down, but in the eyes of II’s, it’s my opinion that they’d want to see the commitment to spending money wisely, and I think the profit generated from UKRTC sales will show it as a good move.
We need to see incremental sales to really make money, as it’s quite clear we won’t get rich off UKRTC
Block - the placing has nothing to do with the write down. It is a non cash event.
The £7m is to upscale production, to buy expensive kit. Fit out a new production facility in Dundee. And some new development. It's actually great news they are already thinking about new projects now rather than further down the line.
7m goes a long way to filling the 8m R&D write down, not remove completely. Sorry, sent in a rush
Look at it another way; we know how much we’re committing to it from the placing allocation.
break the price to its lowest figure in the range, £1.. could be less, could be more, but let’s say £1 for nice round numbers.
£10m, after £3m costs.. left with £7m. covers the cost of the £8m write down of R&D.
just need to find a cash cow now
Amazon maybe BUT also to be sold in Boots - who are a standard bricks and mortar retailer. They will expect a decent margin
I have a business that sells significant quantities on Amazon. That's not always how Amazon works, in many cases they serve only as the marketplace rather than the retailer.
You pay fees, but they are inflated transaction fees rather than them 'buying and reselling'.
I don't think this Amazon proposition is going to be a standard proposition, in fact they are offering their logistics arm rather than 'selling' them.
If this is potentially selling via Amazon and Boots at c£10 then that's £8.33 excluding VAT
Most retailers expect a 100% margin (between purchase and sell price) so let's say £4.20
Therefore, i would expect ODX to make a 100% profit too - so manufacture at £2 and sell at £4 ish - gives a £2 profit per test.
At 200k per week that's £400k profit or £20m a year . Assume this is UK only and excludes any other test sales.
Email from Walbrook, asking for clarification on the commercialisation of the product, and they respond accordingly.
they replied and said ‘ this will be done on commercial terms, but with socially responsible pricing’. So, whilst we will make a few quid, don’t expect this to be the golden goose.
UKRTC will sell to Boots and Amazon, volume will be huge.. let’s say after cost, we’re left with £2-2.50 per kit, or am I being overly positive at that margin?