Member Info for bonzoful

Trading below book value is not that unusual. Among those I looked at today Bellway, Barratt, Direct Line, Kingfisher, Mercia Asset management, all trade below book value. As do many investment trusts. None have the potential of Nanoco which is why I am invested here. Your reasons are not clear to me.

Inflation aside, the deal covers Nanocos basic recurrent costs for the next nine years (£54m recognised as revenue spread over nine years is £6m a year). The cash will be on the balance sheet from next February. Any commercial order feeds through to profits. Aside from disappointed expectations what is not to like?
And in retrospect, any dampening of expectations by Nanoco pretrial would have worked against them had this gone to jury trial.

Revisited the Edison notes to see how they read now. £54 million will be recognised as revenue over 9 years: at £6m a year that more or less covers recurrent costs. As long as even small amounts of material are sold for research purposes Nanoco are likely to be profitable for 9 years with cash on the balance sheet. That is nothing to get excited about. But if and when a commercial contract is signed the firm should flourish. Given the need for sensitive sensors to aid automation the prospects seem good.
That leaves £21m of the £75m Nanoco expect to retain after legal and financing costs: the returns to shareholders are likely to be financed from this sum: with most if not all likely to be paid after the second payment is received from Samsung in Feb 2024.
I don't expect to find better odds elsewhere so shall stay invested.

Henry
You arrived late ( well after the low of 9p) , were sensible, seem to have made a mistake and now sound unsettled ( diplomatic language). Taking your account of your trading at face value you do yourself no favours. Go for a walk. Come back in a week. And the share price may be back where it was. In which case you could exit at a profit. Irrational to do otherwise. Should the share price not recover next week you simply have to choose between taking a loss or waiting for the expected commercial contracts to arrive.
I had a heart attack a year ago. Sounds like you are going the same way. If its getting to you, get out. I am happy staying in.

Had the case gone to trial there was a risk the jury would fail to find in Nanocos favour: a few jurors with a strong dislike of the English would suffice. And had Nanoco won Samsung would certainly have appealed with no cash paid until that process was exhausted. Which would have made it hard to win other contracts before the cash ran out. My own view is that ME is culpable for letting others know how to create CFQD ( though at the time I favoured the Dow contract: more fool me).
As it is we have a well funded company whose prospects depend on winning a commercial contract. If it does the prospects remain excellent. Its a gamble. And always was.

Settlement subject to review by judge. If he rests on Sunday, may review on Monday. So RNS may be Tuesday.

N and S had 30 days from 6 Jan to sort out the details. Which then must be submitted to Judge G for approval. If they take all the time they have and he deals within 24 hours that suggests an announcement on (Jan 6 plus 30 plus 1 less 31 (days in Jan) equals 6 Feb. Monday. Understandable if Judge G has Sunday off. In which case Tuesday.
Settlement likely. But may ask for more time. Or it may still yet go to trial.

My guess is you never served on a jury.

Have enjoyed your contributions since you joined. But suspect that may be since it was made clear that fully funded meant keeping going admin, legal case and support for research for buyers who paid the costs. But all research not funded by others was stopped.

From the BBC website referring to a different jury trial. But a reminder the outcome is far from certain.
Legal experts said they believe it will be a difficult case for Mr Musk to win, and that the fine he paid to the SEC will be used against him in the case. However jury trials in cases of fraud are notoriously difficult to predict.

Nanoco made a catastrophic mistake with Samsung (and possibly display as a whole). They stopped all research not funded by others a few years ago. And need to get hold of more cash before they can resume it. So a settlement enables them to move on to explore the other uses of nanomaterials. Wiser as how to defend their IP, I hope.
It is clear that Nanoco shared too much of their intellectual property with Samsung a decade or more ago. You have to be able to defend your IP and Nanoco failed to. The settlement with Samsung will bring that chapter to a close (though we have no idea whether Nanoco will be able to benefit from future sales to the display market).

While estimates may vary I am sure this is the bigger picture Nanoco are looking at. Plus the opportunity to resume research into new uses for nanomaterisls put on hold a few years back to preserve cash. Given the opportunity to get back to being a nanomaterials company rather than face year at least a year, probably more, stuck in the courts I can see why the Board are pursuing a settlement. I hope it is better than some fear.

As one of our main contributors regularly reminded us before the current kerfuffle the future of Nanoco depends on both the settlement and on future contracts. Any conceivable settlement should provide the cashflow for the prospective commercial contract(s) mentioned by the company to be landed: in a climate when cash from other sources would be difficult or impossible to find. With rock bottom running costs and an unencumbered production line in place Nanoco would soon be profitable.
If the second RNS was intended to dampen expectations so the eventual announcement is greeted with relief so much the better.

I am as disappointed in Mondays RNS as most here. At first I hoped it was an exercise in managing expectations but I think it's worse than that. Nanoco were naive in sharing their CFQD technology with Samsung a decade or more ago and have paid a heavy price. However that technology is a decade or more old. The substances Nanoco is preparing to sell for sensors are, Naoco has said, different. And even at the figure Lobo has mentioned the interest on the sum received by Nanoco would take it close to breakeven. So they are likely to end up with a healthy balance sheet and close to breakeven. If and when a few commercial contracts are landed the shares will look attractive again. Just not as soon as appeared likely last Friday.

I see today as giving us a wonderful opportunity. As the settlement is acceptable to Nanocos CEO I believe it will prove to be worth more than the current market cap of Nanoco. I doubt this is obvious to those not immersed in the details of Nanoco. So today has, in my view, been a wonderful opportunity. I was just over 50 per cent in Nanoco at the start of the day and am now over 90 per cent. I would be very surprised if the share price has not doubled from today's closing level a month or two after the settlement is announced. In which case I would wait patiently for the expected commercial contract to be announced in H2. By end 2003 Nanoco will be a firm with a healthy balance sheet, positive cash flow and a wide moat. There will then be lots of buyers.

A world wide settlement makes Nanoco cash rich and cash flow positive., with a likely commercial contract to follow later this year. A lot of funds are going to have to buy when this becomes clear to them. So I agree the share is likely to double from 60p relatively quickly. I have been happy to switch more of my portfolio into Nanoco and will now wait 30 days before deciding when to rebalance.

The extraordinary thing is how slow the automakers have been to reach this point. A combination of this and investors current preference for cash positive companies has led to SEEs underwhelming share performance. Both factors will reverse over the next 2 years. A wide moat and healthy cash flow in prospect.

Jan 7.5p
Dec 11p

It's the AGM tomorrow. Your chance to ask what you wish.

Suggests Qualcomm and Magna waiting for CES 23 to make announcements. As Seeing Machines in partnership with them RNSs Jan 5-8, perhaps.