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Worrying and sad times globally, with the Russian invasion of Ukraine four days ago.
The cost in human life and suffering, and the destruction, puts other issues into perspective.
That said, the financial sanctions against Russia could potentially impact upon all companies doing significant business in that country.
OTAQ has sold some Sealfence systems in Russia, however this is a small minority of its business, so should not be a major issue.
From the Hertsford Capital plc (then to be renamed OTAQ plc) prospectus (dated 24 March 2020):
"Aquaculture
The first aquaculture product which the Existing OTAQ Group has marketed is Sealfence which was launched in 2013.
Sealfence is an ultrasonic deterrent system designed to deter seals and sea lions from marine fish farming sites. Since the first sale of a Sealfence system in 2013, the number of systems in operation has grown rapidly and at 31 December 2019, the Existing OTAQ Group had a base of 1,164 systems on long-term rental contracts (12 at 31 March 2015) and a further 72 systems have been sold in Russia and Finland. ..."
https://www.otaq-ir.com/investors/corporate-documents
https://www.otaq-ir.com/docs/librariesprovider59/default-document-library/final-hertsford-prospectus-24-march-2020.pdf
Meanwhile, new regulation of ADDs (acoustic deterrent devices) will support the adoption of more modern ADDs such as OTAQ's Sealfence, which can operate at lower volumes and frequencies:
15th Dec 2021 7:00 am RNS Interim Results
" ... The Group also believes that Sealfence is compliant with the updated United States Marine Mammals Protection Act which will be fully enacted in January 2022. This will potentially open up the business development opportunities in North America and Norway as salmon exports to the USA are required to comply with the act which requires no marine animals to be harmed in the farming of salmon. ..."
https://www.lse.co.uk/rns/OTAQ/interim-results-pjcbcd45x2fm49r.html
Looks like Minnowtech is moving strongly into its commercialisation phase:
BUGSS @BUGSSlab·3h
"Learn how Minnowtech uses sonar to help aqua-farmers raise the shrimp that ends on your dinner plates. This free event happens THIS WEEK online! Register here: hxxps://wfy.ai/3srRrkU #minnowtech #shrimp #aquaculture "
https://twitter.com/hashtag/minnowtech?src=hashtag_click
Which is great news for OTAQ:
15th Dec 2021 7:00 am RNS Interim Results
"... OTAQ's investment in the shrimp industry through Minnowtech LLC will see additional revenue in the second half of the year with 27 sonars delivered to Minnowtech by December 2021 and an order placed for 100 more to be delivered in Q4. This will deliver over GBP0.2m of revenue. Minnowtech's business plans forecast rollout of a high three figure number of sonars, which will be supplied by OTAQ, in the 2022 calendar year. ..."
https://www.lse.co.uk/rns/OTAQ/interim-results-pjcbcd45x2fm49r.html
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.
A bullish update from related company Ashtead Technology (AT.) this week, together with a 42% rise from its November IPO at 162p (currently 230p), bodes well for OTAQ's performance this year.
18th Jan 2022 7:00 am RNS Year End Trading Update
"Strong performance for the full year following successful IPO in November 2021
Ashtead Technology Holdings plc (AIM: AT.), a leading subsea equipment rental and solutions provider for the global offshore energy sector, today provides an update on its financial performance for the year ended 31 December 2021.
The Company performed strongly throughout the year, benefitting from improving market conditions across both the Company's offshore wind and oil and gas end markets. Unaudited full year revenues are expected to be approximately GBP55m, up 30% on the prior year and ahead of the Board's previous guidance.
This outperformance was driven by both equipment rental and a higher than anticipated level of new equipment sales in the fourth quarter, driven by customer demand. Equipment rental has seen improved utilisation, and a recovery in pricing from the prior year impact of COVID-19.
The Company's margins were in line with its expectations when accounting for a slightly greater contribution from equipment sales. Accordingly, Adjusted EBITDA is expected to be modestly ahead of previous guidance with Adjusted EBITA comfortably ahead.
Allan Pirie, Chief Executive Officer, said:
"We are pleased with the full year performance which demonstrates the momentum in our business, delivering on what we set out at our IPO. We remain confident that Ashtead Technology is ideally positioned to support energy producers' transition to more renewable sources of energy and benefit from the global investment into offshore wind. We look forward to continued progress through 2022.""
https://www.lse.co.uk/rns/AT./year-end-trading-update-pb2ti8gvqsvdvii.html
Nigel Wray has increased his holding in OTAQ, from 4,576,232 shares to 5,964,868 shares.
So it looks like he has bought 1,388,636 shares in the recent placing, at 22p each, = £305,499.92.
11/01/2022 16:45 UK Regulatory (RNS & others) Holding(s) in Company LSE:OTAQ Otaq Plc
"... 3. Details of person subject to the notification obligation iv
Name NIGEL WRAY
City and country of registered office (if applicable) LONDON
4. Full name of shareholder(s) (if different from 3.) v
Name JARVIS INVESTMENT MANAGEMENT LIMITED
City and country of registered office (if applicable) LONDON
5. Date on which the threshold was crossed or reached vi: 11 JANUARY 2022
6. Date on which issuer notified (DD/MM/YYYY): 11 JANUARY 2022 ...
Resulting situation on the date on which threshold was crossed or reached
15.83% 15.83% 5,964,868
Position of previous notification (if applicable)
14.58% 14.58% ..."
https://uk.advfn.com/stock-market/london/otaq-OTAQ/share-news/Holdings-in-Company/86993847
10th Jan 2022 10:30 am EQS Result of GM, Completion of Placing, Issue of Equity, TVR & PDMR Dealing
OTAQ, the marine technology products and solutions group for the global aquaculture and offshore oil and gas industries, confirms that all resolutions put to shareholders at the General Meeting held earlier today in connection with the Placing announced on 15 December 2021, were duly passed on a poll. ...
The Placing remains conditional, inter alia, upon Admission (as defined below) and the Placing Agreement not being terminated in accordance with its terms.
Completion of Placing and Issue of Equity
Under the terms of the Placing the Company has raised net proceeds of GBP1.23 million which will strengthen the Company's balance sheet and meet its near-term working capital requirements to enable the Company to take advantage of the significant accessible opportunities available to OTAQ in its target addressable markets.
Application has been made for the Placing Shares to be admitted to listing on the standard segment of the Official List and to trading on London Stock Exchange, the London Stock Exchange's main market for listed securities. It is expected that admission of the Placing Shares will become effective and dealings in the Placing Shares will commence at 8.00 a.m. on or around 11 January 2022 ("Admission"). ...
https://www.lse.co.uk/rns/OTAQ/result-of-gm-completion-of-placing-issue-of-equity-tvr-pdmr-dealing-bbbcyt6v35uizqd.html
“ Revenues for six months to 30 September 2021 of £1.8m (H1 FY21: £2.0m’’
Why are you so annoyed?
what are you blathering about 'oh new single post poster' .. the RNS said nothing about revenue ... just a generic troll post !
was expecting revenue to be up slightly, it will be a while before the share price goes back up
15th Dec 2021 10:30 am EQS Result of Placing
OTAQ, the marine technology products and solutions group for the global aquaculture and offshore oil and gas industries, is pleased to announce that it has conditionally raised £1.38 million via the Placing announced earlier today through the issue of 6,272,729 Placing Shares with new and existing institutional and other investors at the Placing Price. The net proceeds of the Placing are estimated to be approximately £1.23 million.
The Placing Price of 22 pence per share represented a discount of 10.2 per cent. to the closing price of 24.5 pence per existing ordinary share of 15 pence each in the Company ("Ordinary Shares") on 14 December 2021, being the last business day prior to this announcement. The Placing Shares will represent approximately 19.9 per cent. of the Company's existing share capital.
Pursuant to the Placing, certain Directors of the Company have agreed to subscribe for an aggregate number of 340,911 Placing Shares.
The Placing is subject to approval by shareholders at a General Meeting of the Company, further details of which are set out below.
Directors' participation in the Placing
The following Directors have subscribed for 340,911 Placing Shares pursuant to the Placing for an aggregate amount of approximately £75,000. Set out below are details of the Directors' beneficial interests in the share capital of the Company as at the date of this announcement and following Admission (as defined below): ...
https://www.lse.co.uk/rns/OTAQ/result-of-placing-c3bm4jhp9q0qqsu.html
15th Dec 2021 7:05 am EQS Proposed Placing
Proposed placing by way of an accelerated bookbuild to raise £1.38 million
OTAQ, the marine technology products and solutions group for the global aquaculture and offshore oil and gas industries, today announces its intention to conduct a placing (the "Placing") to raise gross proceeds of £1.38 million through the issue of 6,272,729 new ordinary shares in the capital of the Company (the "Placing Shares") to investors at a placing price of 22 pence per Placing Share (the "Placing Price").
The Placing will be conducted in accordance with the terms and conditions set out in the Appendix to this announcement through an accelerated bookbuild process (the "Bookbuild") which will be launched immediately following release of this placing announcement (the "Announcement").
In conjunction with the Placing, certain Directors of the Company intend to subscribe for Placing Shares at the Placing Price. It is anticipated that the total proceeds of such participation will amount to approximately £75,000.
Dowgate Capital Limited ("Dowgate") is acting as Sole Broker in connection with the Placing.
Summary and Highlights
The Placing is required in order to address the OTAQ's near-term working capital needs, strengthen the Company's balance sheet and to take advantage of the significant accessible opportunities which the Board believes are available to OTAQ in its addressable markets.
The Placing is subject to the approval by the Company's shareholders of the resolutions to be proposed at a General Meeting (as defined below) of the Company (the "Resolutions"). The Company expects to publish a circular in connection with the Placing in the coming days (the "Circular").
Phil Newby, Chief Executive Officer of OTAQ, said: "This is an exciting time for the business. Having established a portfolio of internally-developed technologies, we have a number of growth opportunities that we are looking to maximise in 2022. Continued development and investment will underpin expected growth in existing and new markets, enabling the Company to establish new revenue streams that will afford increased visibility. We very much look forward to the next stage of our development and believe we are well placed to deliver against our ambitions."
https://www.lse.co.uk/rns/OTAQ/proposed-placing-3pgkj354naskz7u.html
15th Dec 2021 7:00 am RNS Interim Results
Interim Results for six months to 30 September 2021
OTAQ (LSE: OTAQ), the marine technology products and solutions group for the global aquaculture and offshore oil and gas industries, announces results for the six months to 30 September 2021.
Highlights:
· Revenues for six months to 30 September 2021 of £1.8m (H1 FY21: £2.0m)
· Restructuring of senior management team to increase focus on sales led strategy, including appointment of new Chief Commercial Officer
o Positioned to enter new markets with new products and technologies
· Actively engaged with Marine Scotland regarding regulation of ADDs in Scottish waters
o Result of ADD trial anticipated in Q1 2022
o Long term supply contracts with certain customers now ended
o On-going discussions with Subpesca, the Chilean regulatory authority
o Phase one of trial in Tasmania completed
· 288 Sealfence units rented by Chilean customers in the period
· Tracker technology obtained following the ROS Technology acquisition in November 2020
o Clear pathway to commercialisation with prototypes delivered to a customer and trials being successfully completed
· OceanSense 4 and Lander (seabed survey device) with first sales made for each product
· Investment in Blue Lion Labs, a Canadian plankton detection business, to license its technology and develop plankton detection systems for use in the salmon market and other finfish sectors
Post-Period Highlights
· Successful conclusion of a six-month ADD trial with a major Chilean salmon farmer
· Multi-year supply agreement signed to support Minnowtech's launch into Asia
· 27 OTAQ sonars delivered to Minnowtech by end of December 2021 and an order placed for 100 more to be delivered in Q4
o Increased visibility in the shrimp market highlighting strength of broadened portfolio
· Order for tracking technology secured with expectation of around 600 units to be delivered to this customer in H2
o Expected to lead to further sporting event tracking opportunities
Commenting on the results and prospects, Phil Newby, Chief Executive at OTAQ, said: "This was an extremely busy period for the Group - with the focus on commercialisation, product development and securing orders with a view to underpinning revenue visibility on the back of an increased product suite and routes to market.
"We have an exceptional technology set and are seeing increased demand in a growing number of geographies. The team has secured a number of new contracts and we believe that the momentum expected in the second half of the financial year will provide the basis for a step change as we move into the next financial period and beyond."
https://www.lse.co.uk/rns/OTAQ/interim-results-pjcbcd45x2fm49r.html
2022 looks like it will be a very exciting year for OTAQ, with potentially breakthrough progress on a range of fronts.
And yet at the current depressed s.p. of just 24.5p, it's being valued as a value play: net assets as at 31.3.21 were about £6M.
It's not often that you get the opportunity to buy a growth company with such huge potential at the price of a dull value stock, and it's from this combination that mega-multibaggers can be made.
20th Jul 2021 7:00 am RNS Final Results
" ... 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.
In addition to our acoustic deterrence technology, the Group has been busy over the past 12 months developing adjacent technologies that will broaden our reach into the global aquaculture sector. Specifically, we have advanced the shrimp biomass measurement technology through our strategic partnership with Minnowtech and expect to be able to commence commercial sales in early 2022. Likewise, through a collaboration with Blue Lion Labs in Canada, we have accelerated the development of our phytoplankton detection technology and expect to be able to demonstrate its effectiveness in the first half of 2022. 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. ..."
https://www.lse.co.uk/rns/OTAQ/final-results-per68letf081xak.html
" ... Biomass
Marine farming demands a real-time, accurate, method of measuring average weight and total in-cage biomass. At present, there is no system available which fulfils these specific market requirements. Fish farmers have several issues facing them which can be solved with artificial intelligence and machine vision:
* Fish size / Biomass: it is essential for farmers to understand how big their fish are, size distribution and total biomass within each cage;
* Sea Lice detection: salmon farmers have to check and report on sea lice levels daily which takes up a large amount of time and effort; and
* Feed pellet detection: there is a desire to automate the detection of feed pellets so that feeding becomes more automated, precise and less manual.
The Existing OTAQ Group’s proposed biomass system envisages a high resolution stereo camera and AI machine learning. Each of the issues faced by salmon farmers listed above could potentially be addressed by the biomass technology currently in development.
The biomass system, if successfully developed, would offer accurate measurements in a robust, cost effective package. The system would be deployed permanently in every cage and supplied on a service model. The Existing OTAQ Group have now completed the stereo camera test module and a collection of imagery from field testing is being compiled. The major obstacle facing the Existing OTAQ Group is the refinement and training of the artificial intelligence system but two of the major customers have indicated that they will assist with testing.
The inclusion of a pellet (fish food) counting device is also being considered within the biomass technology in development."
https://www.otaq-ir.com/investors/corporate-documents
https://www.otaq-ir.com/docs/librariesprovider59/default-document-library/final-hertsford-prospectus-24-march-2020.pdf
From the Hertsford Capital plc (then to be renamed OTAQ plc) prospectus (dated 24 March 2020):
"New products
The Existing OTAQ Group continues to develop its Sealfence product and in addition to ongoing upgrades the Existing OTAQ Group is also developing versions of Sealfence that can be used in other situations such as for salmon trap nets which are widely used in Finland and other Scandinavian countries and mobile units for other applications.
Plankton Detection
The Existing OTAQ Group also has a number of products in development to address some of the major issues facing salmon farmers outlined above. These include a Live Plankton Analysis System (“LPAS”) which is an algal bloom early warning detection system. Salmon farmers currently analyse water samples manually once per day. If plankton is detected, the farmers may stop feeding the salmon or activate bubble curtains to break up the plankton within the cages. LPAS would take continuous water samples and analyse them throughout the day. It is proposed that only one LPAS system would be required per farm which would be located strategically in plankton hotspot areas.
The LPAS technology if successfully developed would ultimately seek to establish a cloud-based database containing information from all LPAS sensors in one area which would eventually provide a precision / modelling system through the Existing OTAQ Group’s ISAQ cloud-based information system (to be developed pending successful development of LPAS technology).
OTAQ GL has received grants from the Scottish Aquaculture Innovation Centre and CENSIS, Scotland’s innovation centre for sensing, imaging and internet of things technologies, to fund the development of the LPAS technology through the University of Aberdeen’s Floe Cytometry Department’s involvement.
The concepts in respect of these products were exhibited at AquaNor (the world’s largest aquaculture trade show) in August 2019. However, it is not expected that commercial production of the LPAS technology will be possible for at least two years. ..."
https://www.otaq-ir.com/investors/corporate-documents
https://www.otaq-ir.com/docs/librariesprovider59/default-document-library/final-hertsford-prospectus-24-march-2020.pdf
25th Nov 2021 7:00 am EQS Minnowtech Contract and Trading Update
... Trading Update
As announced on 29 October 2021, the trial programme for the Company's acoustic deterrent device ("ADD") with Marine Scotland has now concluded and the results are expected in early 2022. The Board continues to believe that the programme data will support and better inform the EPS (European Protected Species) licensing process required to enable the future operation of ADDs within Scottish waters.
As previously announced, one of the Company's main customers has given notice on OTAQ's ADDs operating in Scotland in accordance with the terms of the original agreement ending in April 2022. Accordingly, the Board has taken mitigating action and is considering a range of funding options, including a significant EU development grant for which the Company has successfully completed the first application stage and will understand the outcome of the second stage in 2022. In addition, the Company is reviewing its working capital opportunities and restructuring some of its financial obligations as well as looking to capitalise on current and prospective new opportunities.
The Company continues to make progress on a number of other projects, including the sports tracking project announced last month, the live plankton analysis system in partnership with Blue Lion Labs Inc., new ADD deployment in Chile, railway trials using OTAQ's tracking technology and ADD trials in Australia.
Phil Newby, Chief Executive at OTAQ, commented: "We are delighted to see the continued progress at Minnowtech. It is well placed for growth and we look forward to working with its team in successfully launching their biomass solution which utilises our sonar technology. Minnowtech has worked hard on developing its business plans as well as its product and we can now see a path to growth. As demand grows for its product, OTAQ will benefit from the corresponding sonar deployment."
Ken Malone, co-founder of Minnowtech commented: "Working alongside OTAQ has enabled us to accelerate our product commercialisation so allowing earlier than expected development of our commercial and sales plans. We are extremely excited by the growth potential and step change in both units deployed and returns expected. We have a solution that has been thoroughly tested and look forward to product launch soon."
https://www.lse.co.uk/rns/OTAQ/minnowtech-contract-and-trading-update-kd71uld2gn2fxo3.html
25th Nov 2021 7:00 am EQS Minnowtech Contract and Trading Update
OTAQ plc (LSE: OTAQ), the marine technology products and solutions group for the global aquaculture and offshore oil and gas industries, announces a new and exclusive multi-year contract to supply Minnowtech LLC ("Minnowtech") with its sonar technology, following the completion of successful trials. The Board also provides a pre-close trading update ahead of the Company's interim results for the six month period to 30 September 2021, which are expected to be released next month.
Minnowtech Contract
Minnowtech, which provides a non-invasive technology for managing shrimp farming around the world, has jointly developed with OTAQ a proprietary shrimp biomass solution for which OTAQ's sonar hardware is a vital component.
OTAQ has supplied units for testing purposes, with a value to date of over USD50,000, which have performed in excess of expectations in real-world field tests, offering significantly better results than comparable sonar products when tested alongside the OTAQ sonar. Minnowtech is now preparing for commercial launch in Asia where an estimated 100,000 plus shrimp ponds are in operation and could benefit from Minnowtech's solution. The signing of the new contract begins with an initial order for over USD200,000 of further sonars with an expectation of further orders from 2022.
Minnowtech benefitted from significant grant income from a US Government agency and equity financing in 2021 to fund its market entry in 2022. OTAQ holds a beneficial interest in approximately 15.2% of Minnowtech's ordinary share capital. ...
https://www.lse.co.uk/rns/OTAQ/minnowtech-contract-and-trading-update-kd71uld2gn2fxo3.html
RICHARD BEESLEY JOINS OTAQ AS CHIEF COMMERCIAL OFFICER
07/10/2021
As part of a major commercial expansion strategy, Richard Beesley has been appointed as Chief Commercial Officer, who will join our senior leadership team.
Richard brings with him over 20 years of knowledge and experience of working in senior leadership roles within offshore energy and marine markets, where he focused on engineered protection solutions, for high value equipment operating in harsh environments. He has a proven track record of strategic business development, having produced and managed multi-million-pound business growth opportunities, in new international markets and adjacent market sectors. Calling upon this experience, Richard will be responsible for delivering OTAQ Group’s substantial commercial development plans across its core markets of aquaculture and offshore.
Phil Newby, CEO at OTAQ Group, says: “Richard’s appointment as CCO comes at a key time for our business. We are expanding our presence in the growing global aquaculture and offshore markets by offering unique marine technologies and required an experienced, high performing individual to help drive our plans forward. With Richard’s demonstrated success of global business growth initiatives in offshore markets, he fits nicely into our senior team and we are very pleased to have him onboard.”
Richard will be based out of OTAQ’s Lancaster office and will work closely with the other existing sites in Aberdeen, Ulverston, Carnforth and Chile, to build a market-leading business within target sectors.
https://otaq.com/richard-beesley-joins-otaq-as-chief-commercial-officer/
MINNOWTECH AWARDED $999,780 IN SBIR PHASE II FUNDING FROM THE NSF
7/26/2021
?July 26, 2021, Kekaha, HI – Minnowtech, an aquaculture technology company that enables shrimp farmers to calculate shrimp abundance for optimizing feed and harvest, today announced it has been awarded a $999,780 Small Business Innovation Research (SBIR) Phase II grant from the National Science Foundation (NSF).
With this Phase II SBIR award, titled “Sonar Arrays for Maximizing Aquaculture Yields,” Minnowtech will focus directly on development of its sonar-based product to meet specifications for the company’s upcoming commercialization stage.
Minnowtech's product is designed to enable shrimp farmers to determine shrimp biomass; optimize stocking density, manage shrimp growth conditions and better time their harvests.
“Nearly $45 billion of shrimp are grown each year, and because they are grown in turbid water, farmers are forced to guess how many shrimp are in their ponds based on their initial stocking numbers," said Suzan Shahrestani, PhD, CEO with Minnowtech. "In working side by side with shrimp farmers, we know the lack of being able to measure biomass is their biggest hurdle to increasing the health of their crops and their profitability as farmers. Our Minnowtech solution targets this unmet need head-on."
In 2019, Minnowtech was awarded a $225,000 Small Business Innovation Research (SBIR) Phase I grant from the NSF. In addition, Minnowtech has raised over $1 million from investments by OTAQ Group (OTAQ - LON) and other investors around the world.
?
“Ultimately, our product provides farmers with real-time estimates of shrimp biomass and behavior with standardized data acquisition, fostering an integrated system for aquaculture monitoring," said Shahrestani. "With this system in place, we can accelerate shrimp aquaculture as a sustainable food source across the globe."
Founded in 2018, Minnowtech was part of that year’s HATCH Blue accelerator program, which helps support the launch of disruptive aquaculture startups. In 2019, Minnowtech also was selected to be among the Fish 2.0 Global Innovation Forum’s “Fish 2.0 Top 40,” representing the cohort of competition finalist startups that pitched to the Fish 2.0 audience of global investors.
About Minnowtech:
Minnowtech is an aquaculture technology company, founded in Baltimore, MD and with operations in Hawaii, that enables shrimp farmers to estimate 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://www.minnowtech.com/news/minnowtech-awarded-999780-in-sbir-phase-ii-funding-from-the-nsf
£350k just gone through ...
Hi Hedgehog,
As well as the profitable recurring revenues, Otaq has another hidden secret sitting behind and further supporting this YOY company growth.
The Fish nets are hired out on a fixed term rental scheme that provides this recurring revenue, generally 12 - 48 months.
At the end of the contract the nets can be taken out of the water, cleaned, repaired ( low cost to fully refurbish to as new standard ) and then re-leased into the next contract, so as each contract adds a 'staircase into profitability, each new purchased net system for their stock reduces in cost of replacement by the time of being fully refurbished so the stock increases in a similar 'staircase' method as do the profits.
Talking of nets they have said they are on the acquisition trail - there are specialist net cleaning businesses out there, some of which have interesting tech that could move over for Peter Robinson to tinker with and add to ?
So OTAQ's revenue, as well as growing strongly, is very recurring in nature.
"Recurring Revenue
By DANIEL LIBERTO Reviewed by DAVID KINDNESS
Updated Nov 29, 2020
What is Recurring Revenue?
Recurring revenue is the portion of a company's revenue that is expected to continue in the future. Unlike one-off sales, these revenues are predictable, stable and can be counted on to occur at regular intervals going forward with a relatively high degree of certainty. ...
Many market pundits consider recurring revenue to be a highly desirable quality. They make a company more stable and predictable, both operationally and financially, lowering the risk that business will take a drastic turn from one month to the next.
That stability usually comes at a cost. Investors are regularly willing to pay more for the earnings generated by companies with recurring revenues because their forecasts are deemed more reliable. ... "
https://www.investopedia.com/terms/r/recurringrevenue.asp
Recurring revenues are also cheaper to generate after the first year, because the initial sales cost doesn't have to be repeated.
But their most important trait is that they largely keep on coming in, year after year.
So unlike one-off sales, which need to be matched annually just to stand still, recurring revenues create a base - and staircase - for revenues to grow upon year after year.
The Herftord-OTAQ prospectus also shows, for the 9 months ending 31.12.19, the proportion of Sealfence revenues generated on a long-term (48 month) contract basis compared to those on a medium-short term (12-18 month) basis and those revenues which are attributable to sales:
48-month contracts: 84%
12-18 month contracts: 14%
Sales: 2%
I.e. the group has a high proportion of recurring revenues.
And the group's annual revenue has risen over tenfold in the last four years:
Year to 31 March 2017: £374,000
Year to 31 March 2018: £919,000
Year to 31 March 2019: £1,570,000
Year to 31 March 2020: £3,420,000
Year to 31 March 2021: £4,053,000
OTAQ's first aquaculture product, Sealfence, was only launched eight years ago, so its huge success from a standing start demonstrates the pent-up demand for such aquaculture technology.
From the Hertsford Capital plc (then to be renamed OTAQ plc) prospectus (dated 24 March 2020):
"Aquaculture
The first aquaculture product which the Existing OTAQ Group has marketed is Sealfence which was launched in 2013.
Sealfence is an ultrasonic deterrent system designed to deter seals and sea lions from marine fish farming sites. Since the first sale of a Sealfence system in 2013, the number of systems in operation has grown rapidly and at 31 December 2019, the Existing OTAQ Group had a base of 1,164 systems on long-term rental contracts (12 at 31 March 2015) and a further 72 systems have been sold in Russia and Finland.
Sealfence uses a unique ultrasonic soundwave delivered through a network of projectors placed around each farm. These projectors work together to create an acoustic “fence” of protection designed to eliminate or reduce significantly seal and sea lion attacks. This has a range of 40m from the location of the Sealfence device. Sealfence has, as standard, remote monitoring of the performance of the system that records the performance of the system and allows full control. The Existing OTAQ Group is continuously developing and upgrading the specification of the equipment.
Whilst the system contains advanced technology it has been designed to cope with permanent installation on the most exposed marine fish farms. Sealfence’s modular design means no cables run between cages and as a result installation and any necessary repair work is relatively simple. The Sealfence system runs for up to 40 hours on battery power.
OTAQ is a recognised brand in the aquaculture industry in Scotland where the Directors believe the Existing OTAQ Group is now the market leader with a market share of over 40% of existing active sites. Clients include major multinationals such as MOWI and The Scottish Salmon Company.
In Chile, the second-largest producer of farmed salmon in the world, the Existing OTAQ Group has had a presence since 2016. The Existing OTAQ Group has deployed systems with a number of major salmon farmers in Chile including Aquachile, Salmones Antarctica, Blumar, Yadran and Multiexport and expects significant growth in this market in the near future. The first multisite programme was launched in February 2019 and the second in October 2019.
The Directors believe that the Enlarged Group is well placed to become one of the global market leaders in predator deterrent products for the salmon farming industry."
https://www.otaq-ir.com/investors/corporate-documents
https://www.otaq-ir.com/docs/librariesprovider59/default-document-library/final-hertsford-prospectus-24-march-2020.pdf
The year ended 31 March 2021 was clearly entirely covered by the COVID-19 pandemic.
So to report an 18.5% increase in revenue (almost entirely organic growth) in such circumstances is impressive indeed, and shows the robustness of demand for OTAQ's products and services.
And it bodes very well for OTAQ's performance as the pandemic subsides:
"Growth opportunities have been restricted due to the travel restrictions in place but we have taken steps to position the Group to take advantage of market opportunities once restrictions are lifted."
Especially as overseas expansion represents such a tremendous growth opportunity, and one which OTAQ is already starting to capitalise upon:
"The Group continues to grow globally with UK revenue representing 70% of total revenue (2020: 77%). Chile represents 7% (2020: 9%) of total revenue with other European countries account for 11% (2020: 6%) of total revenue and the rest of the world for 12% (2020: 8%) of total revenue."
There seems to be a crying need for OTAQ's products and services, and the group appears to be uniquely placed to exploit this, with its compelling range, strong intellectual property, established business relationships, strong cash position, and public listing.