Ben Richardson, CEO at SulNOx, confident they can cost-effectively decarbonise commercial shipping. Watch the video here.
Good on you.
So many PIs look at high share prices and buy in, while kicking themselves for not buying at the lows, but when faced with the opportunity to buy low they don't take it because it's unpopular.
In other news: 90% of PIs lose money on the stock market.
I'm just going through the recent HY24 Trading Update and spotted something, and wondering if I was missing something?
PMcG states that trading is still in line with FY2024 consensus estimates, which are listed as Revenue $66.3m and Cash position $26.1m.
FY24 Revenue of $66.3m would give a 14% increase over FY23 revenue.
FY24 Cash of $26.1m is an *increase* of $3.9m over the cash position at 31st Dec 23 ($22.2)
So, according to the figures in the recent RNS, and despite the cash burn rate, SEE are expecting to be *increasing* the cash position during H2?
Do I have this right?
Yes, this news is worrying, and a disaster for the share price, but it sounds as if the deal was terminated from Itaconix's side.
If John Shaw was only concerned with the share price, he could have signed a new deal, kept the revenue numbers up, wouldn't have to deal with the fallout, and he could have kept looking for higher margin deals with new customers elsewhere.
(This post is for long-term investors. If you're a short-term trader then tough luck, you got screwed)
So why would the CEO terminate a deal with a customer which represents 33% of the company's revenue?
We only have supposition at this point, and your views will be coloured to a significant extent by how much the share price has fallen (which is likely all driven by PI sentiment), but I think tend to believe John when he talks about taking a short-term hit for greater growth later on.
It might delay breakeven/profit projections by a year, but if it means that ITX will generate greater margins in 12 months' time then it will be worth it.
If ITX are to grow as we all hope, they will be constrained by production capacity, and it will require more money to extend capacity. By losing a significant lower margin customer, that frees up capacity for higher margins, thus increasing profitability and delaying the need to invest capital into production facilities.
What it comes down to is whether you trust John and the board to be acting in the company's best interests. Ignore the short-term hit to the share price (again, based purely on PI sentiment), and consider whether this was a smart decision for the longer-term running of the company.
One more thought: if the share price hadn't dropped, how would that change your perception of the RNS? Given that the share price drop is all PIs selling, the drop becomes a self-fulfilling prophecy.
At the 37-minute mark, Paul Hill and John Hughman discuss HVO for about 5 minutes.
Hughman owns and is very bullish. Of course he's talking his own book, but I think his comments echo a lot of investor sentiment at the moment.
https://www.youtube.com/watch?v=lDgZmvy6pdQ
Duke sold out recently with a loss.
Nick is still listed as a major shareholder, no Tr1 from him, so I presume he's still holding?
That's alright, need liquidity to allow new buyers in.
This will help create a more stable platform for the next leg up.
5-10% isn't really a meaningful trade in the grand scheme of things. PIs have to hold longer for bigger gains, and I'm here for the foreseeable.
Good to see everything is still progressing well.
Big German client's production has just started, and will start to show in the next set of figs.
H2 weighting is continuing, so a 50% increase over H1.
Cashburn expected to reduce to USD 1m per month in H2.
Still on track for breakeven during FY25 and company is fully funded up to then.
@dougerboy,
if you're interested in the fascinating properties of stereochemistry (is that an oxymoron...? No...), check out the story behind Thalidomide.
It's a 50/50 mixture (aka a racemic mixture) of two stereoisomers. One isomer has all the wonderful anti-sickness properties, but the other is the teratogenic form (the one that caused the birth-defects).
Nowadays scientists could separate the isomers and release a form that only has the good stereoisomer, however... the human body interconverts them! So our own body would produce a 50/50 mixture of the isomers regardless of which was initially given.
It's an interesting tale, and thalidomide is making a comeback, for some types of disease:
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7936918/
I don't wish to sound negative on the company (or get into an argument), but using the metrics the company highlighted in their broker consensus forecast RNS yesterday:
Revenue: consensus (318.4) vs actual (318.4)
EBITDA: consensus (89.2) vs actual (91.8)
NPAT (adj): consensus (35.3) vs actual (35.5)
Net debt: consensus (71.7) vs actual (69.8)
don't scream Ahead of Expectations to me.
Operating Profit is up (55.1 vs 60.3), which highlights that underneath all the complex moving parts the company is sensibly managed and is heading in the right direction.