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The results are largely after the so called new direction. In reality it seems like a continuation, indeed acceleration, of the fall in sales that we have seen for a number of years.
On 30 March they said -
Modern Water announces that orders for water contamination detection bacteria consumables have increased by 46% in Q1 2020 compared to Q1 2019.
Some of this would have been fulfilled in H1 and by the sounds of it a fair bit needed producing in the new lab space and will be shipped and therefore billed this half as below in today’s RNS.
The increased order levels, seen in H1, are currently being prepared for shipping in H2 2020.
I think you’ll find it was a 40% increase in sales of reagents, not sales overall. I made the same mistake.
Admin costs are massively down from £1.6m to £0.9m but yeah not pretty and illustrates why new direction was needed. Takeover should be even more nailed on so a positive.
Modern Water (AIM:MWG), the owner of leading technologies for water and wastewater treatment and the monitoring of water quality, announces
interim results for the 6 months ended 30 June 2020
Commenting on the results, Gerard Brandon, Chairman of Modern Water, said:
"The necessary structural changes that were outlined in the recently published 2019 annual results, were carried on through H1 2020. The Company business model in 2020 has moved to a collaboration, cooperation and partnership business model resulting in a high volume, high margin recurring revenue strategy. The increased order levels, seen in H1, are currently being prepared for shipping in H2 2020.
"Modern Water continues to retain a leadership position within the water contamination monitoring sector and is adding the latest technologies in ecommerce, logistics, comms, networking and data encryption which extends the global reach of the Company beyond the US, Europe and Far East offices. With thousands of sites and hundreds of water systems installed over the last 30 years, the Company retains a strong international position in water monitoring. The strategic challenge through this COVID-19 pandemic is being met with the move to provide support services online, making it easier and safer to interact with customers while at the same time to increase the capacity of our equipment to provide surveillance against all sorts of contaminants and threats including viruses and pathogens.
"The new platform gives us the ability to further exploit the data the Company generates from different water systems across the world. Data analytics within the latest AI systems, produced in collaboration with Company partners positions Modern Water to receive multiple revenue streams from equipment, consumables and predictive services for our existing and new clients coming online to manage their COVID-19 risk."
So looking at these results a little more carefully.
We were promised that orders and sale were up by 40%+. They are actually DOWN 62%.
We were told that with the cost cutting we would mean that we are cash breakeven. In reality we lost £1m in cash from operations in 6 months. We only had £800k at the end of the half year. At this rate we will run out of cash sometime around November.
These figures are simply unacceptable and it is clear that we have been misled about the prospects of this company (40% increase in sales anyone).
Thank goodness for the merger – although SKIN seems to have finite resources and most certainly cannot support losses of this magnitude for long.
Very few Companies will be able to claim they have been saved by a Pandemic !
Vulcan that is very true as MW must be almost bust again based on their cash outflow over first half year. Shambolic.
I hope that they do not bring down SKIN to.
Good job we are being taken over!
There does seem to be an awful lot of bracketed numbers!
Truely shockingly awful.
Collapse in sales and used most of their cash (£1m in 6 months) with only £800k left at half year.
there we go skin rises 17% we quickly follow
MWG should catch up and reach 4p+ before merger ...hold tight! once merged and fully consolidated we are looking new co SP to go in the rabge of 70p to £1(10 for 1 i.e 7p to 10p)
lol after they get the covid sensor working you wont be worried about 4 (40p) will be stuck at or around this price until they merge both companies cant rise or fall properly as they are 'tied' at the moment imho dyor etc
This merger will go through and was offered 4.05 per share after consolidation I understand does anyone think we may
Get to that price before we merge or stay around 3.55
Why I can't sell MWG ? My Skin shares are still not tradeable in Barclays account. I don't like this
The MMs didn’t go that low there was an odd executed sell at 2.55p I think you mean
Back up now!!
Did anyone manage any cheapies??
Big drop 28%....
Any ideas
in for a few more....beautiful.
gla
from skins chairmans statement this looks good!
Over the last number of months, the teams have designed nano-photonic microchips coated with Affirmers and Aptamers that bind to a recombinant SARS-CoV-2 virus. Detection of binding of the target, in real time, has been achieved using a nanophotonic process. In collaboration with the team at Modern Water, Microtrace OVA systems, originally designed to detect contamination in water for chemicals, trace metals and a range of pathogens has been retrofitted with the Rinocloud AI based Novel Sensor to detect and identify SARS-CoV-2 and other pathogens. These OVA system units have been installed in hundreds of sites worldwide over the last 30 years and form the basis of the roll out of the Novel Sensor into 2021.
https://www.gov.uk/government/publications/water-and-treated-water/water-and-treated-water
See under heading: Quality Water Delivery
“The UK has over 416,175 kms of water mains and more than 393,460 kms of sewers – combined, that’s enough to stretch TO THE MOON AND BACK.”
Many US states getting behind it too-
https://www.wxyz.com/news/coronavirus/state-announces-10m-grant-for-local-governments-to-test-sewage-for-the-coronavirus?_amp=true&__twitter_impression=true
From the RNS.
"For every 10 Modern Water Shares 1 New Integumen Share.
Based on the Existing Integumen Share Closing Price of 4.05 pence per Existing Integumen Share on the Last Practicable Date, the Offer values the entire issued and to be issued share capital of Modern Water at approximately £21.25 million.
The Offer represents a value of approximately 4.05 pence per Modern Water Share "
To my understanding, the figure of 4.05p was purely used as an example to provide a representative value for MWG based on the then Skin share price. It does not mean that Skin will valueing MWG shares at 4.05p. Clearly if MWG shares had risen to 5p and Skin fallen to 3p (30p after consolidation), then MWG holders might not see it as a good deal. As it happens the MMs have made sure the share prices are broadly the same and dragged Skin down to their advantage...
I agree the offer document has to be published before the dvrg AGM so that the AGM can ratify the takeover bid, I believe the ceo of dvrg has said it will be posted shortly. I don't quite get your comment of "us MWG shareholders will either okay the 1 for 10 (1 for 1 pre-consolidation) or not" mwg investors have no say in the consolidation as such - as the take over is bound to go through we can only "vote" with our feet either accept the offer (10 for1) or sell our holding in mwg. By the way 1 for 1 does not now exist.
I think the offer doc is a aimed to be published by AGM and us MWG shareholders will either okay the 1 for 10 (1 for 1 pre-consolidation) or not. I’ll certainly want my MWG shares in the new entity and I imagine most holders will. I’m firmly of the view that anyone not voting for it will be cutting their nose off to spite their face.
Yes you could say MWG is worth more but so is SkIN/Deep Verge and no doubt coming together the new group will create a lot of shareholder value.
I imagine the large holders IIs will vote it through (definitely those who invested in the last raise) and many old holders will who have seen the turnaround but there might be some disgruntled investors voting against.
It’s a no-brainer for me and hopefully we get
Some good news on Covid NPD beforehand.
Thanks MrUnderhill for the clarification