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Benchmark Holdings (BMK), the global aquaculture and livestock business founded by OTAQ director Malcolm Pye, reported strong interim results yesterday, which further
illustrates how aquaculture can be 'insulated' from current economic challenges.
And OTAQ even more so than BMK, as the more technological nature of its business means that supply chain challenges have less impact.
BMK's strong salmon and shrimp business performance is particularly encouraging for OTAQ's activities in these areas.
18th May 2022 7:00 am RNS Second Quarter and Interim results
"Second Quarter and Interim results for the six months ended 31 March 2022
Excellent H1 and Q2 results building on strong FY21 performance
Benchmark (LSE: BMK), the aquaculture biotechnology company, announces its unaudited interim results for the six months ended 31 March 2022 (the "Period"). The Company also announces its unaudited results for the three months ended 31 March 2022 in compliance with the terms of its senior secured bond. ...
• Continued growth in salmon egg sales in Genetics with contracted sales underpinning a strong outlook for the year
• Commercialisation of specific pathogen-resistant (SPR) shrimp progressing well with good take-up in key markets including India ...
Outlook
The Group had an excellent start to the year and is trading in line with market expectations.
Our fundamentals are strong and our opportunities are significant. Aquaculture is a growth industry, supported by robust megatrends with an increasing focus on sustainability challenges as it expands. The answer to sustainability lies in innovation - bringing forward new sustainable solutions. As a focused aquaculture biotechnology company, Benchmark is well positioned to play an important role, helping to improve sustainability across the aquaculture value chain. ..."
https://www.lse.co.uk/rns/BMK/second-quarter-and-interim-results-lotrmwor3ob280i.html
SDI Group (SDI) is currently up 14.24% today, to 172.5p (market cap. £176.3M.), on a positive trading update.
And it has 17-bagged from 10p since the middle of 2016.
The company's monitoring and control area of operation reflects OTAQ's, as does its dual organic and buy-&-build growth model.
This helps to demonstrate OTAQ's extraordinary growth potential.
6th May 2022 7:00 am RNS Trading Update
"SDI Group plc, the AIM quoted Group focused on the design and manufacture of scientific and technology products for use in digital imaging and sensing and control applications, is pleased to provide an update on trading for the year ended 30 April 2022.
Financial results ahead of expectations
Subject to finalisation of the accounts and audit, we expect revenues and profits for the year to materially exceed current market expectations(1) . Sales are expected to be approximately GBP49m (FY2021: GBP35.1m). We expect organic sales growth(2) for the year to be in excess of 20%, which further builds on last year's 19% organic growth. We are also pleased with the additional sales contributions from acquired businesses Monmouth Scientific (acquired December 2020), Uniform Engineering (February 2021), Scientific Vacuum Systems (January 2022) and Safelab Systems (March 2022). Adjusted Profit Before Tax(3) is expected to be at least GBP10.5m (FY2021: GBP7.4m). We also expect to report very strong operational cashflows, significantly ahead of market expectations. ...
About SDI Group plc:
SDI designs and manufactures scientific and technology products for use in digital imaging and sensing and control applications including life sciences, healthcare, astronomy, manufacturing, precision optics and art conservation. SDI operates through its company divisions: Atik Cameras, Synoptics, Graticules Optics, Sentek, Astles Control Systems, Applied Thermal Control, MPB Industries, Chell Instruments, Monmouth Scientific, Uniform Engineering and Safelab Systems.
SDI continues to grow by developing its own technology advancements and by improving its global sales channels, as well as through pursuing strategic, complementary acquisitions. ..."
https://www.lse.co.uk/rns/SDI/trading-update-2ogkbnomhcup0ls.html
Four clear Divisions in the Company.
1. Oil & Gas - was shocked as the O & G industry went negative and has now recovered to set new highs as Oil went back over $100.00.
2.Salmon - hit by the MMPA ( Marine Mammals Protection Act ) and Scotland trials ADD, plus Chile closing down for Covid ... Chile now reopened market size somewhere between 2 - 4 times larger than Scotlands.
3. Minnowtech - Shrimp farming - Massive market, it dwarfs the world wide Salmon market.
Susan S and tam started off looking at jelly fish and focused on Shrimp .. great world class technology - biomass feeder / reader being rolled out into trials.
They have a great piece of kit that its 15.2% owner OTAQ helped build and are supplying to it, more developments ongoing from Otaq.
4.Tracking Device - locates a person to within 60 cm's - that is world class industry leading technology.
They are testing it on Railways - I assume for workers to ensure safety protocols are met ?
They have also landed an Annual world famous sporting event - 610 units.
ONCE the railways and sporting event give feedback data for other users to study and identify its unique selling points this could easily match, then exceed its Oil and Gas portfolio.
Every piece of kit that Otaq sells has a dual use into one of its other divisions, it can instantly cross sell the technology into new and growing markets.
e.g Oil and Gas - leak detector - into Salmon industry links with plankton detector.
Tracking device - Oil and Gas, Salmon nets location, Sporting events, Railway trial.
Biomass feeder - salmon farms and shrimp farms.
If you look into each of their devices it has a dual use.
Shrimp and tracking - keep an eye on them do some research - Going Postal.
"Minnowtech Trial Partnership Program
Minnowtech will be selecting partner organizations to take part in a six-month trial of our groundbreaking biomass reader for shrimp, the BRS-1.
BRS-1
Selected partners will be able to purchase a minimum of five (5) BRS-1 devices at a 40% discount.
Initial Service Period
Each trial will include six (6) months of free biomass readings and support.
Deployment
The BRS-1 device is attached to a weighted stand that is submerged at a minimum of five (5) meters from the edge of the pond. Each device is connected to a case, pondside, that manages power for the device and enables downloading of biomass data.
Management
During the trial, Minnowtech technicians will be taking biomass readings and servicing the devices. In an effort to minimize the variables of this trial, we’re asking each partner not to move them.
BECOME A TRIAL PARTNER"
https://minnowtech.com/
With their trial program, Minnowtech are clearly seeking to reduce barriers to adoption, which is a shrewd business move.
This gives users the opportunity to test and embrace the innovation, before committing long term at full price.
And in addition, Minnowtech are employing very targeted and eye-catching online advertising, such as this banner advert above a shrimp aquaculture article on the Fish Site:
"Feed with Pinpoint Accuracy
MINNOWTECH
SIGN UP TO BE A TRIAL PARTNER
BRS-1 Biomass Reader for Shrimp"
https://thefishsite.com/articles/global-shrimp-production-sees-significant-growth-in-2021-gorjan-nikolik-rabobank
This is precisely the type of business combination that investors should want to see:-
I.e. not only a quite groundbreaking product, at the perfect time.
But very effectively marketed, with adoption made easy.
If you're at all interested in OTAQ, then watching Minnowtech's new BRS-1 (shrimp biomass reader) product launch video is more than essential:
"MEET THE BRS-1
Please allow us to introduce, the first-ever biomass reader for shrimp, the BRS-1.
LAUNCH VIDEO"
https://minnowtech.com/
At just over ten minutes long, it's a very enjoyable and informative video (with a nice bit of humour in it!), and it brings home just what a truly impressive and transformative piece of kit is.
Minnowtech's manufacturing partner OTAQ features, and it was OTAQ's engineering team that brought this product to life, using their long experience of designing such products for tough marine environments.
As such it's both high tech, and a very robust device designed to be deployed for long periods of time.
From the shrimp farmers featured in the video, it seems that this is the product that they have been waiting for for a long time, and that it is really the answer to their prayers.
Here are some verbatim comments from a shrimp farmer featured near the end of the video:
"It's very exciting that you can tell the biomass in a pond.
I think that shrimp farms all over the world have this question, and for me personally and our company it's gonna be a game-changer. It's gonna really help our business, it's gonna save us money.
This is gonna change how people farm shrimp around the world."
"Marine shrimp farming
From Wikipedia, the free encyclopedia
Marine shrimp farming is an aquaculture business for the cultivation of marine shrimp or prawns[Note 1] for human consumption. Although traditional shrimp farming has been carried out in Asia for centuries, large-scale commercial shrimp farming began in the 1970s, and production grew steeply, particularly to match the market demands of the United States, Japan and Western Europe. The total global production of farmed shrimp reached more than 1.6 million tonnes in 2003, representing a value of nearly 9 billion U.S. dollars. About 75% of farmed shrimp is produced in Asia, in particular in China and Thailand. The other 25% is produced mainly in Latin America, where Brazil, Ecuador, and Mexico are the largest producers. The largest exporting nation is India.
Shrimp farming has changed from traditional, small-scale businesses in Southeast Asia into a global industry. Technological advances have led to growing shrimp at ever higher densities, and broodstock is shipped worldwide. Virtually all farmed shrimp are of the family Penaeidae, and just two species – Penaeus vannamei (Pacific white shrimp) and Penaeus monodon (giant tiger prawn) – account for roughly 80% of all farmed shrimp. These industrial monocultures are very susceptible to diseases, which have caused several regional wipe-outs of farm shrimp populations. Increasing ecological problems, repeated disease outbreaks, and pressure and criticism from both NGOs and consumer countries led to changes in the industry in the late 1990s and generally stronger regulation by governments. In 1999, a program aimed at developing and promoting more sustainable farming practices was initiated, including governmental bodies, industry representatives, and environmental organizations. ..."
https://en.wikipedia.org/wiki/Marine_shrimp_farming
That US$9 billion p.a. is of course at wholesale shrimp prices.
The retail value of shrimp is obviously far higher, with a global market value of US$62.8 billion last year.
And the industry is actively looking to improve production through novel technologies such as Minnowtech's:
"Top Companies in the Shrimp Market
Oct 25, 2021
The global shrimp market reached a value of US$ 62.8 Billion in 2021. Looking forward, IMARC Group expects the market to reach US$ 84.2 Billion by 2027, exhibiting a CAGR of 4.8% during 2022-2027. As per the analysis by the IMARC Group, the top manufacturers in the shrimp market are continuously innovating along the entire production and marketing chain to meet the increasing consumer expectations regarding product wholesomeness, quality, and sustainability. Production technology continues to be mostly extensive to semi-extensive with improving standardization of procedures from artisanal to industrial scale. In line with this, shrimps are more prone to periodic outbreaks of strong diseases and health management problems that disrupt supply chains and potential investors. In order to curb this challenge, key players are developing newer vaccines and adopting proactive alternatives, such as improved biosecurity, genetic selection measures, better pathogen detection, effective use of immunostimulants and probiotics. Although the shrimp industry is based on a single species with few genetically selected and improved lines, the producers are still aiming for additional genetic gains to significantly enhance production through a combination of traditional and novel technologies. ..."
https://www.imarcgroup.com/shrimp-companies
Accurate shrimp biomass measurement is critical for efficient shrimp farming management, and it's been estimated that at least US$500 million is being lost p.a. through the lack of this - although the real figure is likely to be far higher.
While shrimp production is increasingly dominated by large companies, well-funded, and actively looking to employ disruptive new technologies.
So just a few large contracts, each rolled out across multiple sites, could easily generate good multi million dollar revenue.
Minnowtech @minnowtech· 22 Apr
"The BRS-1 Live Launch Event is happening now! Join us at the link below and see how the BRS-1 can change the way you farm.
hxxps://buff.ly/3xDveV2
#MinnowtechFakeLivestream @shrimp #aquaculture "
Minnowtech @minnowtech· 22 Apr
"Thanks everyone for tuning into the livestream tonight! We had such great questions from across the globe. We will share a recording of the entire livestream soon! #MinnowtechFakeLivestream @shrimp #aquaculture "
https://twitter.com/minnowtech?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor
Looks likes Minnowtech's launch of its biomass reader for shrimp aquaculture has gone very well, with great global interest.
As is to be expected: as the world's the first-ever subsurface biomass reader for shrimp aquaculture farming, it will fulfil a large and pressing need in this huge industry.
Aquaculture is the fastest growing form of food production in the world, and the shrimp industry seems to be growing particularly strongly:
"Global shrimp production sees significant growth in 2021
by Rob Fletcher
17 November 2021, at 6:21pm
Global shrimp production levels in 2021 are set to be at least 8.9 percent higher than they were in 2020, while growth of over 5 percent is forecast for 2022 – painting a very positive story for the shrimp farming sector. ..."
https://thefishsite.com/articles/global-shrimp-production-sees-significant-growth-in-2021-gorjan-nikolik-rabobank
"Global shrimp production to surpass 5 million MT in 2022, CP Foods' Robin McIntosh predicts
By Chris Chase
January 20, 2022
Global shrimp production has continued to trend upward, with a panel of experts at the National Fisheries Institute’s Global Seafood Market Conference predicting that global shrimp production will exceed 5 million metric tons (MT) in 2022.
Current predictions put the production at 5.011 million MT in 2022, a significant increase over the 4.569 million MT grown in 2021, which itself was an increase over the 4.086 million MT produced in 2020. Globally, shrimp production has seen a tremendous upswing – in 2015, global shrimp production didn’t even reach 3 million MT. ..."
https://www.seafoodsource.com/news/supply-trade/expert-predicts-global-shrimp-production-will-exceed-5-million-metric-tons-for-first-time-in-2022
At current shrimp prices, that would have a value of about US$9 billion p.a.
If Minnowtech can capture even 1% of this value, then that could give it US$90M. p.a. in revenue.
JUNE 10, 2021
Turning research into commerce
Engineering alumnus recognized for 'first-of-its-kind' AI water testing tech for fish farming
By Brian Caldwell
Faculty of Engineering
An alumnus of Waterloo Engineering who parlayed his graduate research into a startup company that is out to solve worldwide water problems has been recognized by a national innovation organization.
Jason Deglint, a co-founder of Blue Lion Labs, is one of five winners of a Mitacs Entrepreneur Award for turning research into businesses that impact the lives of Canadians.
The honour in the global impact category comes a month after Blue Lion, which was launched in 2018, teamed up with a leading marine technology company in the United Kingdom to develop an imaging system to warn fish farmers of harmful plankton and algae blooms.
OTAQ announced it is investing $300,000 for an approximate 10-per-cent stake in the Waterloo-based company. The partners are aiming to commercialize the technology within the next 18 months.
Deglint (MASc ’16, systems design engineering, PhD ’19, systems design engineering) was described by Mitacs, a non-profit organization backed by federal and provincial governments, as “an up-and-coming entrepreneur” who is advancing “first-of-its-kind technology.”
The system based on his doctoral research combines artificial intelligence (AI) software with a custom digital microscope to automatically detect harmful algae in water.
Current testing methods rely primarily on analysis of water samples at off-site labs and results can take up to a week to obtain.
The technology being developed by Deglint and Blue Lion co-founder Katie Thomas, who has a doctorate in biology from the University of Waterloo, would yield results in minutes and effectively function as an early warning system.
Current testing 'prone to human error'
“Essentially, if fish farms want to know what types of organisms are in their water today, the sample ends up on a slide with a human looking at it,” Deglint said in a media release. “It’s a tedious, time-consuming task that’s prone to human error.”
A growing industry, aquaculture represents about a third of the total fisheries value in Canada. Harmful algae blooms are a major source of damage and losses.
Deglint, who worked at Waterloo Engineering as a Mitacs postdoctoral researcher, accepted his award during an online ceremony today.
“Supporting innovation is essential to help Canada rebound from the repercussions of the global pandemic, and Mitacs is extremely proud of the remarkable accomplishments achieved by our network of talented entrepreneurs,” John Hepburn, the CEO and scientific director of Mitacs, said in the release.
https://uwaterloo.ca/news/engineering-entrepreneurship/turning-research-commerce#first%20#AI%20#artificialintelligence%20#fish%20#fishfarms%20#uwaterloo%20#GEDIx
"Blue Lion Labs
We use biology and machine learning to build tools which help monitor and preserve aquatic systems.
Blue Lion Labs - Pitch Video"
At 2:50 - "But this is just the beginning. Our solution can be applied to drinking water, recreation, and many other sectors, to help safeguard our water."
https://bluelionlabs.com/
World food production and supply is facing some huge challenges: a growing world population, climate change, and more recently the COVID-19 pandemic and the Ukraine-Russia war.
Aquaculture can play a vital role in helping to meet these challenges, and is crying out for new technologies to help its growth and efficiency:
"Big data and artificial intelligence in the fish industry
New methods reduce costs and increase efficiency
From a global perspective the fish industry has lagged far behind most other industries with regard to the introduction of information technologies. In neither the fishing nor the aquaculture sector have these advanced technologies made sufficient headway so far. Over the past few years, however, a race has begun to catch up and improve the state of the seas and the sustainability of human activities in these important areas. ..."
http://eurofishmagazine.com/sections/technology/item/625-big-data-and-artificial-intelligence-in-the-fish-industry
So OTAQ is at the forefront of a hugely exciting market opportunity.
With its successful Sealfence acoustic deterrent device set to be complemented by two other major technologies:
1. Biomass Measurement.
Marine farming demands a real-time and accurate method of measuring average weight and total in-cage biomass.
OTAQ has developed its shrimp biomass measurement technology through its strategic partnership with Minnowtech, which is now commencing commercialisation.
2. Plankton Detection.
Phytoplankton, or "algal bloom", is a major disease challenge for the aquaculture industry generally and it is estimated the global aquaculture industry suffers $3.4 billion in damage and losses annually due to organisms such as algal blooms and harmful phytoplankton. Early detection of this problem should allow farmers to deploy their defence systems early enough to markedly reduce the losses and improve overall fish welfare.
OTAQ has accelerated the development of its phytoplankton early warning detection technology through a collaboration with Blue Lion Labs in Canada, and expects to be able to demonstrate its effectiveness in the first half of 2022.
OTAQ has strategic shareholdings in both Minnowtech and Blue Lion Labs, and in the future both could potentially become part of the OTAQ group, to complement it organic growth.
OTAQ non executive director Malcolm Pye built up Benchmark (BMK) from its initial start-up into a major international aquaculture technology business, serving the global salmon, shrimp, tilapia and farmed fish industries.
BMK's current market cap., at 48.6p, is £342.12M.
Which is nearly fifty time larger than OTAQ's current market cap., at 18.7p: £7.05M.
Minnowtech to Introduce First-Ever Biomass Reader for Shrimp in Special Product Launch Digital Event, April 21
Minnowtech’s BRS-1 will be unveiled as part of a launch initiative to invite a select group of industry aquaculture partners to join a special six-month product trial
April 5, 2022, Kekaha, HI – Minnowtech, an aquaculture technology company that enables shrimp farmers to calculate shrimp abundance for optimizing feed and harvest, will host a special digital event, April 21, to introduce the BRS-1, the first-ever subsurface biomass reader for shrimp aquaculture farming.
Until now, shrimp farmers had almost no way of determining how many shrimp were actually in their pond.
With the BRS-1’s groundbreaking subsurface technology, shrimp farmers now can determine the total count and biomass of their shrimp with 95% accuracy, allowing them to rest easy knowing their investment is safe and optimize their harvests and profits.
With shrimp a growing, vital source of protein worldwide, the BRS-1 provides farmers, for the first time, a tech-enabled way to meet global shrimp demand while optimizing their individual livelihoods and fueling local economies.
As part of the BRS-1’s launch event, Minnowtech will introduce its Trial Partnership Program in which Minnowtech’s team will invite and select a limited group of partner organizations to participate in a six-month trial of the BRS-1 biomass reader for shrimp.
Media are invited to attend the live streamed launch event
What: Minnowtech’s Launch Event to Introduce the BRS-1 Shrimp Biomass Reader
When: Thursday, April 21, 2022, 9:00pm ET
Virtual Event Registration: hxxps://minnowtech.com/register
About Minnowtech:
Minnowtech is an aquaculture technology company, founded in Baltimore, MD and with operations in Hawaii, that enables shrimp farmers to measure shrimp biomass with precision. Using Minnowtech’s sonar-based system, shrimp farmers optimize the health and growth of their animals, enhancing harvest of market-size shrimp while minimizing risks to juvenile shrimp. Learn more: www.minnowtech.com
https://minnowtech.com/minnowtech-to-introduce-first-ever-biomass-reader-for-shrimp-in-special-product-launch-digital-event-april-21/
Recent Share Trades for Otaq. (OTAQ)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
14-Apr-22 16:35:11 18.70 1 Sell* 19.00 20.00 0.19 UT
14-Apr-22 16:15:45 20.00 10,000 Buy* 19.00 20.00 2,000 O
14-Apr-22 15:50:40 19.85 4,500 Buy* 19.00 20.00 893.25 O
14-Apr-22 14:50:59 18.50 8,000 Sell* 20.00 21.00 1,480 O
"Journal of Banking & Finance
Volume 75, February 2017, Pages 109-117
1-share orders and trades
Ryan L. Davis a, Brian S. Roseman b, Bonnie F. Van Ness c, Robert Van Ness c
Abstract
1-share trades are the most common odd lot trade size, accounting for 9.62% of all odd lot transactions and 3.65% of all trades on NASDAQ in 2012. While 50.41% of 1-share trades result from broken orders, 34.89% of 1-share trades are intentional. We provide substantial evidence that traders use 1-share trades to “ping” for hidden liquidity. In particular, our results indicate that 1-share trades are disproportionately aggressive and also execute against hidden liquidity more than any other odd lot trade size. We also find a relative increase in trading immediately following a 1-share trade. Our results are in line with Clark-Joseph (2014), who suggests that traders may use small, unprofitable trades to detect information from other traders. Specifically, 1-share trades represent the minimum cash outlay necessary to trade, while simultaneously producing the smallest possible effects on a market maker's inventory, and in turn, a security's price."
https://www.sciencedirect.com/science/article/abs/pii/S0378426616302035
From the Financial Spread Betting Ltd. website:
"Q. When you see a trade go through for say 12 shares or even 1 share, what is that all about?
Surely it can't be a personal investor, is it some sort of balancing act?"
"A: Say there are 1,100 shares available to buy on the order book. Someone buys 1,080 leaving 20 shares there on the book. The next buyer may buy 2,000 shares but the 20 shares left on the book go through as a separate buy even though the buy was for much more. In the US you actually see these separate buys on your contract note so a purchase of 200 DELL might show as 2 80s and a 40 making up the 200 that you have bought.
Also, not a lot of people know this and there is a reason why, its pretty useless information but...Crest, Bloomberg, UBS, RBS, etc. anyway, most brokers, clearers, settlement banks, data people, all buy 1 share in almost every listed company so that they automatically receive and are entitled to any corporate information. It may not be the reason for any specific purchase or sale but its one of the reasons a buy/sell of 1 share."
"PUBLICATION - RESEARCH AND ANALYSIS
Aquaculture - use and efficacy of Acoustic Deterrent Devices (ADDs): report
Published 8 April 2022
From Cabinet Secretary for Rural Affairs and Islands
Directorate Marine Scotland Directorate
Part of Marine and fisheries
ISBN 9781804350690
A report into Acoustic Deterrent Devices (ADDs) in the aquaculture sector to provide a better understanding of how they are being used, their efficacy and any potential for impact on sensitive non-target species. Records described the extent of ADD use in Scotland from 2014 to 2020."
https://www.gov.scot/publications/use-efficacy-acoustic-deterrent-devices-adds-aquaculture/pages/1/
Published on Friday 8th. April 2022, this much-anticipated report on the use of ADDs in Scotland is great news for OTAQ, as it's broadly supportive of use of lower-frequency (newer) ADDs, such as OTAQ's.
The report says that there's no real evidence of real negative ADDs effect on cetaceans (i.e. whales-dolphins-porpoises).
And moreover, it says that the stress effect of seals on salmon health should be considered.
In addition, the report indicates that ADDs are effective.
In terms of recommendations, the report recommends more research into the detail of the above aspects, in order to better inform the management of ADDs.
I.e. it is accepted that ADDs use should continue, but that such use should be as efficient, effective, and appropriate as possible, which I'm sure OTAQ would agree with.
(It's funny how researchers often recommend that more research is needed!)
I expect that OTAQ will be involved in any such ongoing ADDs research, which will provide terrific credibility & publicity for the company in the Scottish aquaculture community, and further afield.
And I expect that now this element of uncertainty hanging over OTAQ's ADDs business in Scotland has been removed, that the s.p. will be able to move ahead strongly ... especially from the current very depressed level of just 21p.
Benchmark Holdings (BMK), the global aquaculture and livestock business founded by OTAQ director Malcolm Pye, reported strong Q1 results last month, which illustrates how aquaculture can be 'insulated' from current economic challenges.
And OTAQ even more so than BMK, as the more technological nature of its business means that supply chain challenges have less impact.
It's also interesting to note BMK's strong cash position:
"Cash of £50.6m and Liquidity (cash and available facility) of £61.6m as at 21 February 2022"
Considering the buy-&-build strategy employed by BMK, OTAQ at its current s.p. of just 20.5p looks a sitting duck for a BMK takeover attempt, and looks a prefect fit.
Thought I think that it would have to pay at least double or treble OTAQ's current s.p. to succeed.
"Malcolm Pye
Non Executive Director
Malcolm founded, and from 1999 to 2019 was Chief Executive of, Benchmark Holdings plc ("Benchmark"), the world's leading aquaculture health, nutrition and genetics business. Malcolm has over 35 years' experience in international agribusiness through his various roles at Hillsdown Holdings (then HMTF Group), and through building Benchmark from the initial start-up into a major international aquaculture technology business serving the global salmon, shrimp, tilapia and farmed fish industries. Malcolm focused Benchmark's activities on animal health, breeding and genetics, advanced nutrition and knowledge/technology delivery and led the flotation of Benchmark in 2013, maintaining a lead role in investor engagement."
https://www.otaq-ir.com/investors/board-of-directors
"08 MAR 2022
Strong outlook in uncertain times
Benchmark’s recent Q1 FY22 results highlighted strong operating trends in its three business areas and a positive outlook in key end-markets, especially farmed salmon. The group’s strong position serving the aquaculture industry should, in our view, insulate it from economic shocks resulting from the geo-political situation and thus make for attractive, safe haven investment.
The company has a strong balance sheet and liquidity position following its £20m equity fundraising last year, which we consider will become a more prominent positive element in its investment case. However, Benchmark will have to refinance its NOK855m senior bond, which falls due on in July 2023. Doing so would remove something that may otherwise become an overhang as it approaches the due date. ..."
https://www.equitydevelopment.co.uk/research/strong-outlook-in-uncertain-times
"I think the main reason is the overall stock market weakness this year, especially for many shares, with many tech. shares being particularly badly hit."
That should say: ... especially for many penny shares ...
Terry,
I think the main reason is the overall stock market weakness this year, especially for many shares, with many tech. shares being particularly badly hit.
Combined with the company being in a quiet period for RNSed news: there's been no real news announced from the company since mid December.
And this share is very illiquid, so if even just one or two retail shareholders decide to sell some, that can have quite a big impact.
But illiquidity is a double-edged sword of course: this share can move up very quickly on minimal buying.
The irony is that oil services and related companies are some of the few to have been doing well recently, and a lot of OTAQ's business is in that field.
Surging oil & energy prices are creating boom conditions for producers, with their s.p.s soaring as a results.
And that also increases demand for the products and services of oil services companies.
NYSE-listed Schlumberger (SLB), the world's largest oil services company, has already seen its s.p. quadruple over the last couple of years.
But the improved conditions don't yet seem to have such an impact on smaller oil services shares, so there could be an opportunity there.
Hedgehog, considering all the positive news you are posting, what do you think is driving the share price weakness?
OTAQ has multiple revenue streams, and strong revenue growth looks likely on a number of product fronts.
In particular, there are two products that in aggregate could potentially deliver revenue growth of say c. £2M. in OTAQ's coming financial year, which would be a step change in the company's turnover:
1. OTAQ sonars to Minnowtech.
Hedgehog100 Posts: 1,695 Price: 27.50 Strong Buy Minnowtech Marching On! 9 Feb '22
" ... So 127 OTAQ sonars to Minnowtech will deliver over £200K. of revenue to OTAQ in its H2 to 31.3.22.
If a high three figure number of sonars are expected to be supplied in 2022, say 800, then that would mean 700 in April-December 2022.
Which on the basis of over £200K. for 127, would suggest over £1.1M. for a further 700."
2. OTAQ Sealfence systems in Chile.
20th Jul 2021 7:00 am RNS Final Results
" ... Final Results for the year ended 31 March 2021.
... In the meantime, our ADDs are being deployed in increasing numbers in Chile, notwithstanding the ongoing Covid biosecurity restrictions that are in place. The number of operational ADDs in that market has increased from 142 as at April 2020 to 264 at the end of June 2021 and several large-scale trials are currently underway utilising our technology. The Chilean aquaculture market is substantial and estimated to be over three times larger than the Scottish market where we are currently most active. We look forward to further growth of our ADDs in Chile and other geographic markets where similar trials are currently underway and the regulatory framework is more settled. ... "
https://www.lse.co.uk/rns/OTAQ/final-results-per68letf081xak.html
15th Dec 2021 7:00 am RNS Interim Results
" ... Interim Results for six months to 30 September 2021
...288 Sealfence units rented by Chilean customers in the period ...
Post-Period Highlights
· Successful conclusion of a six-month ADD trial with a major Chilean salmon farmer...
The successful conclusion in October 2021 of a six-month trial with a major Chilean salmon farmer has resulted in discussions about a further rollout to the customer's sites. ...
As a result of the Group diversifying and developing its interests outside of the Scottish salmon market, Chile has seen growth in the first half of the year and the recent successful conclusion of a six-month trial with a major Chilean salmon farmer is expected to lead to increased growth in Chile in the second half of the year and beyond. ..."
https://www.lse.co.uk/rns/OTAQ/interim-results-pjcbcd45x2fm49r.html
So potentially an increase in OTAQ's annual turnover of c. 50% or more, from about £4M. to £6M.+.
And potentially also a very strong move into pre-tax profitability.
20th Jul 2021 7:00 am RNS Final Results
"... Final Results for the year ended 31 March 2021.
... 18.5% increase in revenue to GBP4.05m (FY2020: GBP3.42m) ..."
https://www.lse.co.uk/rns/OTAQ/final-results-per68letf081xak.html
15th Dec 2021 7:00 am RNS Interim Results
"... Revenues for six months to 30 September 2021 of GBP1.8m (H1 FY21: GBP2.0m) ...
The Board anticipates that revenues for the full year will be broadly in line with the full year to 31 March 2021,..."
https://www.lse.co.uk/rns/OTAQ/interim-results-pjcbcd45x2fm49r.html
OTAQ's financial year ends in just a fortnight, and they appear to be expecting a strong second half recovery.
Full year revenue of about £4.05M. is expected, i.e. about the same as last year.
Following on from H1 revenue of £1.8M., this would suggest H2 revenue of about £2.25M.
Which would be an impressive half-on-half increase about £450K., i.e. a c. 25% rise.
Both of OTAQ's branches of operation are in sectors with a bullish outlook this year:
1. Aquaculture.
Surging food prices should benefit primary food producers such as salmon & shrimp farmers.
2. Energy (oil & gas, and renewable).
Surging oil & energy prices are creating boom conditions for producers.
So whereas for other sectors these inflationary pressures may be business challenges to be wary of, for OTAQ they are positives.
In addition, OTAQ now has minimal negative exposure to the passing COVID-19 pandemic, or to the Ukraine-Russia war and its fallouts.
So with a challenging stock market outlook for the majority of companies and sectors, OTAQ looks to be in the ideal businesses at the moment.
Last month OTAQ also further expanded their team, in a move which further highlights the very bullish outlook for the company:
"OTAQ AQUACULTURE INTRODUCE NEW BUSINESS DEVELOPMENT MANAGER ROLE
03/02/2022
We are pleased to announce the appointment of Gareth Hammond as Business Development Manager for OTAQ’s Aquaculture division as part of our continued commercial expansion strategy.
Gareth, who joins us from Vaki where he was managing their fish counter and net pen aeration UK and Ireland business for over five years, said “My focus is to promote and grow the Aquaculture business for OTAQ’s expanding product portfolio within the industry globally. OTAQ’s approach towards innovative technology and collaborative working with customers to find practical solutions that improve their operational efficiencies are key reasons for me wanting to join the OTAQ team. I look forward to getting involved.”
Our Chief Commercial Officer, Richard Beesley, who joined OTAQ in August 2021 said, “Gareth’s appointment is an important step in our overall growth strategy for the Aquaculture market. With his wealth of knowledge and experience in fish farming technologies and operations, as well as his enthusiasm to bring innovative solutions to market, Gareth is a great fit and we are very pleased to have him join the team.”
As well as expanding sales on OTAQ’s existing products such as our acoustic deterrent system Sealfence, underwater IP cameras and laser measurement systems, Gareth will be focused on the introduction of exciting new OTAQ marine technologies that will be coming to the market within the next 12 months.
For any queries relating to our product range and sales please contact Gareth.hammond@otaq.com
26/01/2022"
https://otaq.com/otaq-aquaculture-introduce-new-business-development-manager-role/
Minnowtech have just further expanded their team, following on from their significant expansion last year:
"MINNOWTECH ANNOUNCES HIRING OF DANIEL NAFARRETE AS AQUACULTURE R&D TECHNICIAN
3/15/2022
?Nafarrete brings his technology skills and experience to applying Minnowtech’s sonar-based system at a shrimp farm in Kauai
March 15, 2022, Kekaha, HI – Minnowtech, an aquaculture technology company that enables shrimp farmers to calculate shrimp abundance for optimizing feed and harvest, today announced the hiring of Daniel Nafarrete as Aquaculture R&D Technician, located at the company’s Kekaha office on the Hawaiian island of Kauai."
https://www.minnowtech.com/news
This supports the likelihood of 2022 being a very exciting one for Minnowtech, as it moves strongly into its commercialisation phase.
Which of course is great for OTAQ, Minnowtech's partner and part-owner.
From 2009, but still relevant now:
" ... It is often said that salmon sells well in difficult economic times. This seems to be true also in the EU during the current economic downturn. Probably the reason is that salmon, despite the significant rise in prices, remains a competitive and attractive seafood product, and given its high penetration in both the food service and retail channels, especially at the medium-level price segments, sales are hurt less than those of other species that are targeting more price-sensitive consumers. ..."
https://www.fao.org/in-action/globefish/market-reports/resource-detail/en/c/338161/
"Global demand for Scottish salmon sees a near return to export sales record
By Calum MacLeod - calum.macleod@hnmedia.co.uk
Published: 12:27, 11 February 2022 | Updated: 12:29, 11 February 2022
Scottish salmon exports recovered to near-record figures in 2021, according to new figures released by the UK Government.
Cementing its place as the UK’s biggest food export, salmon overseas sales increased to £614 million, up 36 per cent compared to 2020 and only marginally below the £618 million recorded in 2019.
The official HMRC figures have demonstrated the strong global demand for Scotland’s unrivalled farm-raised salmon. ..."
https://www.northern-times.co.uk/news/scottish-salmon-bounces-back-to-near-record-world-demand-265797/