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Hi extrader, i think those ascertions are reasonable in terms of what SP could be.
However, if you own differing quanties of shares then the overall value relative to ORPH changes.
100k shares in ORPH at 55p would be worth £55k
But said 100k shares would only result in 33k shares in Poolbeg, so at 7p per share that is only £2,310, or an equivalent of 2.31p per ORPH share.
So a guestimation of 100p across all entities is certainly sensible, but if the shares held across all entities differ then the equivalent shareholder return certainly wont be ORPH shares held x 100p
I am sure this is understood, but it is difficult to forecast overall return for us shareholders until we know how many shares we will own in each entity and the respective share prices upon IPO.
I am excited for what is in store, but naturally have no idea what my ORPH and associated holdings will be worth in 12 months. I expect a lot more than today :-)
@Extrader
Valuation of spin offs wise - I still think that CF is simply sticking out his finger and calling it based on what the EKF secretary told him.
If it helps -
EKF EV c£334mn - today's EV (note that when it spun out the 3 below - the EV was not so high)
Trellus - on IPO EV c£100mn
Verici - on IPO EV c£40-50 mn
Renalytics on IPO EV c£85mn
* note I am using 1st day of public trading as a proxy of IPO valuation.
@Demon
That's why we got CEOs, on the other side of the spectrum who end up being wooden by keeping quiet on all sensitive issues - leaving PIs always uncertain and guessing.
With CF, we can receive so much guidance and visibility that is way beyond any CEO. I, indeed, am very thankful for this and hence why Orph is my biggest investment.
For CF, it can not be easy for him to "stick to the script", to be on live recording to ensure that he is very careful in what he says yet always alluding/ nudging the PI to potential newsflow / what's ahead. In fact, I would be astonished given how much he discloses that if he were not to get timelines / figures occasionally wrong. CF strikes me as someone who is offering help / seeking to share rather than to be boastful and making unsubstantiated claims.
Taking a look further, CF in a bang on trend growing biz like Orph - spot on. Excitable, great prospects, growing, sharing the pie with fellow shareholders - sounds consistent with his personality from what I have observed.
However, put CF as a CEO of a struggling company and I would probably see him in a different light. Things to hide, putting on a brave face, BS factor etc.
Hi Demon G,
Thanks for the reality check , which prompted me to do a 'quick and dirty' guesstimate :
(1) ORPH rumpco : guided revenue of £ 50m this year , maybe + 30% in 2022, @ 6 x sales = (65x6) = £ 390m; assume 700m shares (390/700) = 55p
(2) POLB : guidance 10-20% of ORPH MCap (pre xr 35p) = 3.5-7.0p (validated by yesterday's xr drop?), expects 2-3 x before Nasdaq-ready. Optimistic 7p x 3 = 21p preNasdaq; Nasdaq multiple ? Who knows, say 2x = 40p
(3) DIM : your 'golden ticket', I agree. CF has guided 'maybe worth = ORPH'. Who knows ? Say 1/2...390/2= £ 195m; mutatis mutandis (195/700) = 27p
(4) Imutex : no idea . Higher value IP universal flu etc (Ph 3 cf BiondVax BVXV prefail MCap = $ 500m) x 30% x 49% = $ 73m, say £ 50m / 700 = 7p. Reality check ? Ties in with the 10-20% valuation range CF has ballparked.
(5) PrepBio : ditto, another 7p
Sum of the parts (1-3 at end 2022, 4-5 at spinoff by 'autumn 2021) = 55+40+27+7+7 = 96p.
Say 4p in divs to end 2022 (which might in themselves help rerate as an 'income stock' - as it would for DIM) = 100p.
100p x 700m shares = £ 700m @ £/$ 1.40 = $980M.....
I'm sure some of these valuations are wildly out....but that could apply both ways ...so overall not unrealistic/impossible, in my view.
Appreciate your (and anyone else's ) input / corrections/ alternatives !
TIA
In my view the valuation of the core business will be significantly affected by the likelihood of it being bought out, minus the spin-offs. IMHO that likelihood is increasing by the day. In the right hands, and with a long term view, the core business could be worth a huge amount of money to the right organisation, far more than the 50-60p / share being bandied about at the moment.
I think we’ll agree to disagree on CF. He’s doing a great job but he contradicts himself time and time again. Great promoter of the company though, I agree, just needs to stick to the script and not get ahead of himself.
I'm not disagreeing, however, the growth here was from 6p to 45p. We're sitting at £230M Market Cap currently - I'd say that's fair. DIM is where the value is, that's the speculative growth area. The core business with spin offs looming will increase from where we are today I have no doubt but I over egged my target and after yesterday my target reduced. Still a great company but not as big a potential as I first thought. That's all.
Demon Sir,
Thank you for the analysis. A timely counterpoint to the ebullience of Mr Friel.
Not just a counterpoint though. You reference specific points and the disparity therein.
Having spent significant time on a couple of boards in the past where any opinion which challenged received wisdom was obviously proof of being a fifth columnist it is refreshing indeed to see positions challenged intelligently and courteously.
A recent member here I have, nevertheless, expressed my disappointment with the yahoo style of the CEO. This does not lessen my hope that his bluster, smoke and mirrors are successful and make us all a little more secure.
Again, thanks and sorry for rambling on.
I agree BC. I understand the delta between last year and this year. I have no doubt that there is upside here, otherwise I would have sold out in full but I don't believe there is much upside with the core business, I think there is a ceiling. I think we're sitting at fair value for core business, if anything a tad rich. The golden egg for me was always DIM, which is where I see huge upside but given CF's exuberant timelines I don't see this happening anytime soon. He contradicts himself time after time and it is wearing. I was looking for a numerical forecast for the year, he never commits to anything, his figures never add up, I've sent numerous emails to IR asking to explain his comments regarding figures he has spouted in his presentation and when I get a reply it never adds up, 2+2=5. Last year, he mentioned being a service company, fair value is 2/3 times revenue, he's now saying something different, why? because his revenue figures aren't high enough and the only way to get to a higher valuation is to have an increased multiplier. I could sit here and go through numerous things, at the end of the day I was fully bought into CF and now I'm not, I think he's good, he's hard working and fair but he changes the story to suit his agenda. For an AIM CEO he's up there but he's lost a bit of gloss and for any LTH, if they were honest, they would say similar. One parting shot before I depart, he said at the start of the year, that contracts were sitting on the hopper, multiple contracts, they were then delayed by MHRA approval, we'd see them in the coming weeks, its now nearly July and the contracts will come after the characterisation study, I have no doubt they will come but just tell it how it is - you're being dishonest. Every time he says things like this and it doesn't bear fruit, it dents his credability. Listen, I get it, he has a job to keep the spirits high and momentum going and he's the best in the business at it but reign it in a touch because after a while it loses its effect. This is a great board, with some good contributors. At the end of the day we've all done very well with OO but I believe there are better long term prospects out there - one mans meat is another mans poison and all that jazz. GLA
I agree with BC, isn't that a big reason why many are and will invest in this share , as its a share in transformation, its is no longer what it was, and no doubt going forward todays OO will be shadow of what it is today.....every share has to start somewhere, and OO has really made an impressionable start since a year ago....just note the next RNS or two next week ....and off we go again imo
Demon, a great feature of this BB, in my view, is that open debate and conversation is the norm. I think your post summarises nicely the two camps people fall into, many who share your view voted with their feet yesterday and hence the drop. For me, it seems a logical misstep to attach too much to last year’s results when it’s clear so much has changed and so much lies ahead. But to each their own.
I’m sorry, I’m not going to post much going forward because I don want to come across as a deramper but it’s is certainly not brilliant. I could go through the accounts and pick holes but I won’t do that because it was a transitional year. The EBITDA profit was expected, overall profit poor. Revenue was the most disappointing for me, proforma down from 2019 was terrible. Doesn’t matter how you paint it, it’s poor. Story has changed for me on those results. GLA
Not many better run AIM companies out there. More than happy to keep holding and topping up. I was buying on sale day yesterday.
I'm definitely not an accountant, but from my basic reading of the accounts.
ORPH had 20.6 million revenue from customers last year (six times the previous year)
There was 19.2 million cash at bank.
There was 15.6 million deferred incoming (contracts booked for this year I'm assuming)
And all this from the transition year when the new structures and efficiencies were being put in place.
If we can put aside CF's exuberance (not easy, I know :-) and some of our own expectations for the future of ORPH... This is bl**dy brilliant. Seriously.
This is the base on which all the expected news flow will now build.
It is a really strong base.
Personally, I'm happy with this. Have a great Friday everyone.