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"we might think them incompetent but i don't believe for a second they themselves are all self-aware enough to agree with that conclusion too. and we know the likes of lr will have received well over half a million in cash following the acquisition so i don't believe for a second he would be unwilling to throw say 5 to 10 percent of that into his latest venture, one in which he'll be itching to climb to the top of."
if he got £0.5m and is on a salary of maybe £0.3m he might have zero interest in buying shares and may be just in it for a couple of years of easy money. why risk 25-50k which could go to far better use (fairly sure he has a decent financial advisor)? this is not me saying that is what he is doing but just theorising. i won't lie, if someone said to me "here is £0.5m plus £0.3m salary + benefits in a company which, to be honest, is dying on its ****" and i didn't have any comparable offers i would 100% take it. i certainly wouldn't invest in said company. couple of years of easy money in which time i could be lining up my next move. on the flipside, he may really believe in the company and be desperate to throw his hat in the ring.
however, all we know currently is that we've not had a director buy for over 18 months, so make of that what you will.
Can't buy any on IG, may be good oman
NDA I don't believe in it in our case. Every body knows about the dispute, so why not let it be in the open. Then people can judge, if we have been badly treated. We were at the forefront, when fecking Tory scums needed us. What is the point of having NDA
For this to be an open period now and have nobody buy, including the new directors from YG, it would have to mean that all the directors believed themselves to be unable to make a success of the company from this position, from a £33m mcap with YG as part of the group and £44.1m in cash.
We might think them incompetent but I don't believe for a second they themselves are all self-aware enough to agree with that conclusion too. And we know the likes of LR will have received well over half a million in cash following the acquisition so I don't believe for a second he would be unwilling to throw say 5 to 10 percent of that into his latest venture, one in which he'll be itching to climb to the top of.
So yes whether it's officially a closed period or not (it's often a grey area with these sorts of situations) I think they'll all be told to hold off until the dispute is resolved one way or another in the months to come.
Gl..whilst we might be in a closed period now...one would hope there is a lot of action going on...they could have bought in after the last trading update. When the latest info is out to the market.
I am not convinced we are in a closed period regarding to gov dispute.
They have had long enough to have informal talks...it has gone past that ..it is either going to court ..in which case they prob won't be talking that much to each other.
Or all of a sudden the gov will have an internal meeting and say we can't win ..let's make an offer.
I really doubt they are phoning each other each week to see if there is a change of heart
Market makers decide the spread. It is one of their tools for manipulating trade action to suit them .
Eg one of the theories is that if there is a large spread it will deter buyers as they will be immediately down by 10%
Of course advertised prices are not necessarily the same as live prices.
Should read who decides
Could someone pls explain to me how decides on the spread. I m hold OCADO/ASOS & others and there is hardly a penny spread. Here we have 10%
Ps great post GLTader, very informative.
I am firmly of the opinion that we are in a closed period. Most of us think there's going to be a settlement over the coming months which would mean almost certainly talks progressing at this point. With it being so very critical to the future of the company one way or the other it would be highly surprising if directors felt comfortable buying with that sort of insider knowledge.
If Lynn Rees bought £250k worth of Yourgene shares at a valuation of about £10m mcap that included all their debt then i'm confident he'd be buying shares in the combined novacyt-yourgene group that has over 10x the cash YG had and no debt at just £33m mcap.
So if no director deals are forthcoming that to me simply tells us that they can't rather than they don't want to.
p100..fair point on my valuation of sp if ncyt win dispute. was a back of *** calculation when they had not burnt so much cash
i will need to recalculate.
The danger with this management seems to be that having a war chest of cash enables them to fritter it away.
I wish they would acquire something else because if we lose and have to pay back..then it will have to be on the never never..and at least they would have something to show for COVID
Your comment on strategy..is what I have been saying since salad man came in.
There doesn't seem to be one...nothing tangible just marketing glossary Scrabble.
And that is why they won't make a decent profit.
You have penny share management that had won the lottery. Unfortunately they did not up their game
I am not a huge fan of dealing with the Chinese ..
They are far too clever at reverse engineering.
Good point on director buys...the last I remember was when bio were building a stake ...but they seemed to abandon any plans they might have had with every salad update
It is disappointing that the directors don't buy as it would certainly support the SP..but they seem as uninterested in sh value as they are in the future of the company
Dear all, sharing my thoughts on the trading update and investment case for Novacyt.
The trading update, if I can choose a word to describe it, was uninspiring.
Revenue came in just above mid-range of guidance, with core businesses not growing. Perhaps both impacted by the Q4 combination efforts. Cash at £44m is lower than I expected but can be reconciled as such. £81m - £26m (YGEN shares + SVB + Thermofisher) - £6m (cash burn Novacyt H2) - £3m (legal fees for acquisition both sides) - £2m (restructuring costs / YGEN cash burn). I had expected £48m but didn't account for restructuring costs and lower H2 sales.
What is encouraging, however, is synergistic savings of £5m will be delivered, of which 80% already done. I think more can be achieved. From what I read, the strategy is (a) commercialise via YGEN team - all the clinical products listed, with the Novacyt injected into it, (b) push on instrumentation placements (Ranger and PCR) and (c) re-focusing Novacyt legacy business to what it was good at - ROU. This should deliver further savings.
I was disappointed with no outlook for 2024 but when I looked back at 2023 announcement, it also did not contain it. So, perhaps it is too early to give a guidance, or they are discussing with brokers for an updated report. I still anticipate a £25m business, turning cash flow positive by end 2025. Prior to its acquisition, YGEN was almost at break-even. So, improvement in sales will get it there. Then it's Novacyt's overheads - which from the restructure, should come down.
I am surprised, positively, with foray into the Chinese market. That could be a significant growth driver on both businesses - I think we all know China has its needs in all the areas of diagnostics we provide.
Now, why am I still here and will look to add as and when I can.
Cash balance of £44m + value of a business with £25m TO / 55% margin = £1+
We are clouded by DHSC legal dispute. I fully expect this to be resolved by way of settlement. It's in no one's benefit to go through with full hearing. Any settlement at NIL or above will improve on valuation above.
I would expect director buys by now - and I can only surmise we have not seen any due to ongoing discussions re DHSC legal dispute. Or maybe we will see some now with SP so low.
And btw, the volumes are pittance. Being walked down. Interestingly, if you look at the chart, the up days are high volume, and the downtrend, on low volume.
Good luck all.
HC, fair but I totally disagree about 2x net cash, what is that based on? We are a massively loss making business so surely the market would price this in? They can see that the management is totally inept and there's no big demand for the products so what exactly is going to persuade them to price it at 2x net cash? Surely with diabolical operational performance (which is what we have), no forward outlook in every rns (tangible stuff not just AI generated marketing speak), losing millions per year they're not pricing it at much more than net cash at that point in time?
What if the dispute is delayed by a year, 2 years etc.? Cash dwindles, losses rack up.
HC , okay let's say we get to £3 following DHSC court dispute. Let's say we win outright . What do you feel Novacyt will do next potentially with that cash and can this pump the SP to £6+ ?
Thanks CaptainSwag for your opinion. It's obvious we need some good contract win . Obviously we need to win the DHSC case , which would bring more cash into the company to acquire 2 more companies ( similiar size to Yourgene ) that can bring revenue each of £15- 30M per year. That's the only way I can see the SP getting close to £6. Otherwise I will lose my savings.
Nonsense. It is unheard of to be valued below net cash (cash minus debt) , I’m not sure I’ve ever come across it besides ncyt, and this very unusual situation is still mainly because of the dispute. Even you’ve said that numerous times (you keep predicting wipeout).
The fact that ncyt have been able to acquire a respectable diagnostics competitor and spend all the money restructuring and absorb years of poor performance and still have £44m net cash is positive.
If they won the dispute in full (big if, sure, but it’s your scenario) I see at least temporarily a rally to 2 times net cash - hence £3+ would be possible in the ensuing frenzy.
That’s the sort of exit price that would be possible at the top of the spike for those itching to be done with this investment.
This isnt a fruit machine, that is fixed to pay out everytime you put money in?
You put your money in and hope, the jackpot comes round again...
Baring in mind the jackpot has already been paid out once, already!
So, will another jackpot will come, who knows or when?
But, getting spiteful on the BB because you are down, isnt helping your stress levels, or indeed anyone elses?
As in the words of Warren Buffet, patience, patience and more patience or sell and move on?
Right, off to the day job :)
Swag how do you think it'll get to even £2? That's over £140m marcap. We have cash of £44m which could be circa £40m by June, do you honestly think we will get £100m+ from the dispute? Cash balance is the max we can be valued at when the operational performance is as bad as it is. Acquisitions so far the jury is out as all we have done is overpay for a company on the brink of going bust.
i couldn't care less anymore, i've done 90% of my investment in this ****e. as i've said before it's just in now for a spin of the roulette wheel re the dispute. doesn't matter if it's 40p or 15p by dispute time.
Wb- it was unfortunately the kind of update i was expecting. more vague salad.
to answer your question - yes i think there is too much cash burn...especially considering what they seem to achieve. either i was very wrong in my appraisal of the potential of the original NCYT portfolio or they are seriously underachieving. in terms of management - direction - strategy - sales - communication - playing the AIM game etcetc
i still think they will come out with a good result in the gov dispute-and we are looking at potentially £2-3 - though i am worried that the decline in sp might start to affect the ultimate price we get. I will then be out.
I don't think you will see your £6 with this management. I think LR would be a better choice of leader temporarily - just from a quick fix to the SP..but the worry is that long term would he bankrupt another company.
my 2 cents ...GLA
PI100 we r only down 2p today, pls keep calm, don't do any thing silly!!!
HC £2.50 is possible?
Nope, Amers mis read my post... not far behind wbafc now :)
Asking someone if the share price is going to rise 1200% because that happens to be your average is a really stupid question. It’s irrelevant to everyone else that uses this bb.