If you would like to ask our webinar guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund a question please submit them here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
The fallout of Friday’s shambles continues - Zeus forced to suspend their analyst forecasts.
And that's not counting the extra dilution from the cash raises. So well done the Chuckle Brothers, Bundred & Johnson for prove yet again that a great business can be undone by useless management
Thank you very much
The NED's have badly let shareholders down as they have access to any information they needed but seemingly never asked the right questions when they should have done. They deserve the boot.
This was compounded by executive and senior management apparently being out of their depth as to the feasibility of and the management of the process of untested technical change in their manufacturing process.
At this price circa 15p they may well be able to raise new money but they may l need to be much more convincing than of late that they do actually have a firm hand on matters. The alternative is a bid from some source that can deliver the goods and as a shareholder one can only hope if it gets to that state that there are more than one interested parties.
As requested a transcript of the Saturday mail stock watch.
Surface transforms which makes carbon ceramic brake discs for cars lost more than a third of its value after it lowered its sales outlook. The AIM listed firm made £1 million of sales in October. Its best month so far this year, but said this was still less than expected, and challenges in production mean the group will reach the required manufacturing rate later than hoped. It Therefore reduced its sales forecast for 2023 to 8.6 million £ having made 6,300,000 to date shares plunged 31.9% or 7.5p to 16p
Although I also saw the Stockwatch in Saturdays Mail online from memory. As already posted - Nothing we did not already know.
But I'm sure the company will easily raise some funds if needed for their production to commence & their OEM 10 contract worth £100m. I liked their statement '' They have been selected as a tier one supplier of a carbon ceramic brake disc '' So it has to be a gift at below 20p. Should recover fast when any funds are raised if still required.
Glad to have taken a large profit here before the drop.
Hi Numptypi,
Could you please give me the gist of the mail article from Saturday, I cant find anything online on it?
Does Johnson have Toto Wolff 's mobile number?
The Board must act. They can't pretend that the current mess is down to external factors - 1/3 of value of company wiped out due to factors within the management team's control i.e. financial forecasting, operational excellence etc. Did Bundred & Johnson really NOT KNOW the situation 4 weeks ago when they confidently told shareholders tthings weer stabilising? Bundred must resign or be asked by the SID to step down and a new chair appointed who will grip this mess
Awareness to sell if you missed the RNS
Nothing we didn’t already know, but the publicity from appearing in the (short three paragraph) Daily Mail Saturday stock watch is certainly going to raise awareness
Very much agree with a number of the comments made here in recent days. This remains of great potential on a truly long term view (10 years +) IF we can get there. But the Board have damaged their credibility enormously over the past year or so. The H1 financials were hugely disappointing and it was a leap of faith to say the least to imagine that they would get anywhere near the original forecast but of course there was confidence, even adamance, that they would do so. I can deal with manufacturing challenges, that's to be expected to some degree. But the disingenuous communications and what therefore feels like U-turns is completely unacceptable. I have always had mixed feelings about Bundred's style. In Q&As he is perfectly civil but swats away reasonable questions from shareholders as though they are irritations. It is of modest comfort to know that he is in the same boat as many of us. I remain in for the long term (through intention but also now necessity).
Totally agree with your comments. However, there needs to be much more done here:
- first, the Board needs to instigate urgently a thorough review of what went wrong: messaging, financial forecasting, operations management, and staff oversight and training. And they need to do this AT PACE because shareholders need answers!
- second, Easton needs to drastically overhaul the operational team and find out how they Johson & the Board could have signed off on this portion of the 1H results statement on Sept 29th:
"Our operating loss (before non-recurring items) was £4.6 million compared to £2.4 million in the same period last year. This is due to a number of ramp-up issues we experienced as our production capacity increased to meet growing demand. These ramp-up issues resulted in lost contribution of £1.6m and costs of £0.9m with equipment failures and scrapped production. We have overcome these technical challenges and do not expect these outlays to re-occur. Indeed, the work completed has resulted in improved production processes and the design of proprietary equipment."
-third, heads must roll. Bundred should resign as chairman and be replaced by s/o who actually challenges Johnson and isn't in love with the product. And we given the international nature of customer base; high time we had European or US NED
-fourth: they need to overhaul their approach to IR & communications. today's announcement shows the level of reporting shambles within the company. Absolutely no proper oversight/understanding of any key function : financial forecasting (over to you Isabelle), shareholder management (over to you Isabelle), operations (over to you Easton).
- fifth, the Chair & Johnson should get on the bloody phone and apologise to their advisers/ & equity analysts whom they have comprehensively hung out to dry
-sixth: urgent discussions over working capital - they need to get on with it.
Absolutely time now that Bundred stepped down. Absolutely clear that Johnson and Bundred have hung us out to dry yert again by the continued inability to do the basics well.....frankly staggering that Johnson has the effrontery to make his comments as if its bloody obvious there are going to be problems. Absolute shambles of a management team that (1) has misled their shareholders (I mean ffs at what opint did they realise they couldnt make their own bloody numbers, numbers which they had assured us all were achievable)
This has been on my watch list too, but I have kept on the sidelines....mainly because scaling up is always a big challenge and it is hard to do it without some problems along the way....the scaling up was always going to need more working capital at some point, IMO.
Johnson works hard and is committed , but he has had to wear too many hats and appointing Stephen Easton in May, but not getting him started until September added to the problem...with Johnson not as experienced with the complexities of manufacturing processes.Johnson needed the room to stand back and see things more from a distance, instead of what has turned out to be a period of fire fighting to get problems resolved ... something that has proved expensive in terms of fixing the problems that they did not foresee ..although they must have learned a lot from it all, including to realise the furnace design wasn't good enough
Easton looks like the right man for the job and has skill,experience and leadership experience ....but he came in too late unfortunately ..they needed that COO much earlier
" the Company will have sufficient cash to continue its extensive three year capital expenditure programme and working capital required as sales increase through the year.".
That was back in April.... today things tell a different story....
Despite all this, they do now look to have a team in place to move things along....but Johnson needs to step back and manage from more of a distance now that Easton is in place..
They shall raise the necessary cash soon You bet ! Could still be a good buying opportunity or top up chance below 18p. Might have to be quick though. Here is the summary from mid Oct. from a chat posting. .......................
Superb news - a '' £100m '' contract win from OEM10, "one of the world's largest automotive OEMs".
There's many a slip 'twixt the cup and the lip....or something like that.
Given the share price slippage today's news was predictable for those with a cynical outlook.
Nevertheless, with many years of know-how and experience now in terms of perfecting the product, a huge order pipeline, only one competitor globally, and an increasing need for their products, SCE remain in an enviable position.
For newbies and those looking to top up this is an ideal oportunity imo.
Let's hope the cap.ex facility is successfully concluded with at worst a small-ish fundraising and/or other financing for working capital. If the OEMs are as keen on SCE's products as they appear to be, then surely they should be prepared to finance the incredibly small sums (by their standards) necessary at a few % above base rate were SCE to approach them.
Yeah agreed. This share has been on my watchlist for a while but I have held off because it’s always challenging scaling up a business, particularly at the pace they’re looking to. And some people may be out of their depth.
Feel sorry for shareholders enduring this pain but it looks like it’s going to get worse before it gets better (if it even does). I will continue to watch and monitor but it’s not an enticing prospect to invest in atm
How to finance the working capital is the question left hanging but I think we all know what that means. Longer term this could fly but short term pain.
Agreed. This lot are out of their depth and lack the financial resources.
About time this business was sold to someone with the resources to accelerate the capex programme.
Nowadays this is always leaky on the news, the update explains the recent fall. £8.5 m is well short of the £13m expected for year end.
Looks to be more short term pain for the shareholders....
It was always the risk when they moved from a well worked batch processing method that they initially proposed to the current production line one.
The thing is James a contracted and prospective order book totalling £710 million with a 60% gross margin points to a company that will be multiples of its current valuation in the near future. A takeover now would be like selling fifty pound notes for a fiver.