Member Info for BoringBernie

W£

We'll have to agree to disagree on that ! I've seen nothing in the last 4 or 5 years that suggests to me that DSM are interested in being involved in buying us out.

If they'd sold far more Fruitflow than they actually did, then I'm sure they'd have run a slide rule over the numbers to see if it made sense, but the numbers never made sense. As a supplier to then and a long-term partner they'll want us to do well, but I think anything else is wishful thinking.

Interesting times. I wonder if we'll get another holdings RNS showing who's taken DSM shares soon ?

It looks very much like it's been a controlled passing of shares from <a> to <b>, so, while DSM reducing again should put to bed the idea that someone had they "just wanted to be below 10% for admin purposes" and also all but rules them out as an entity who'll try to buy us ( neither of those looked likely, so no great surprise ).

That controlled move of shares is reassuring though.

BB

Slam

No, we don't, they might have finished selling but they're obliged to inform the company ( PXS ) as they move through % holdings.

That's probably an over-simplification on my part, and might not be the case if they have a single order which was being slowly filled, but I think is broadly correct ?

I don't think DSM reducing is a negative thing, but equally I doubt very much they were concerned about the regulatory issues associated with holding > 10% ( Unlike Stuart Lucas, who as a private individual I can see why he'd prefer to stay under 10% ).

Over time I expect DSM to reduce more. To some extent they chose not to extend the profit sharing agreement ( maybe Ian was playing hardball ? ) and let it lapse and we obviously still have an ongoing relationship with them, but I think we're now in a situation where they want us to do well, will help us where appropriate, but don't see us as core to their business.

BB

Looks like they've been taking some profits on the shares they, relatively recently, took in lieu of cash for Fruitflow stock.

That's not a massive surprise to me, but may dent the belief of some that they'll try and buy us out one day.

BB

Slam

Other websites have an explainer on Trades pages saying "Trade definitions are based on the mid-price and are indicative only" so your theory isn't really a theory, it's reality.

If someone wants to estimate buy and sell volumes then you really need to know what prices were being quoted for Ordinary trades during the day.

You might as well throw away any A trades as well, because they're of limited use in working out what's going on.

Basically, the Buy and Sell volumes on here, and anywhere else are mathematical guesses, and on stocks like Provexis with a wide shown Bid/Offer range which is almost always wider than any likely quote you'll get, those mathematical guesses are likely to be quite wide of the mark.

On more liquid stocks, with tight spreads, the Buy/Sell volumes will be reasonably accurate, but for stocks like Provexis, I ignore them.

If you take try to read much into them, there's a reasobable chance you'll be operating on erroneous data ... not always though, sometimes a delayed trade will turn up which then balances things out.

BB

It's not impossible that both numbers are in the right ball park. ALL of the raw materials might be up to 1500 RMB/kg, with Fruitflow being much more expensive than the rest of the materials ?

It depends how much the overall product weighs and what proportion is Fruitflow. As a possible answer only ...

If Fruitflow makes up 25% of each tablet, then the contribution of Fruitflow to the OVERALL cost/kg would be 6000/4 = 1500 RMB/kg.

I doubt that example is right, but you, hopefully, get the idea.

Pumpky

It is showing, but, not unusually, lse.co.uk has an issue with their feed ( proving you get what you pay for ! )

81,478 @ 1.15 - 9:30:11 would presumably have been your trade ?

I don't think the war'll be having a massive effect here.

My guess is the people who spotted a trend on the way up have read guesses that it'll happen by the end of January, then before Chinese New Year, then after Chinese New Year and are just happy to bank the profit and move on. Nothing wrong with that either.

Barring a pretty unlikely negative outcome on BlueCap, eventually someone's guess or, not desperately intelligent, AI model will be right and we'll all be happy.

Dig deep over the weekend Doc and do some topping up on Monday. I'll be disappointed if there isn't a holdings RNS with your name on it by Friday !

David

Unless I'm reading it wrong on my phone, your AI numbers are wrong ?

For example, it's got a market cap range of 16 to 24 million equating to a share price range of 2.5 to 4p.

Given the current sp of ~1.4p gives a market cap of 33 million the above is rubbish ( or my eyes are tired ! ).

It might be Artificial, but it ain't Intelligent !

BB

Slam

Ford has been careful with his words wrt significant and using it with volume rather than revenue, so I think it's wise to be cautious on margins.

However, if the 1 Billion Yuan sales figure being bandied about is real* then their investment of tens of millions should hopefully look after itself. I'm sure the GM will be below the 55% or whatever our average GM might settle out at post-DSM royalties, but I'd be surprised if Ford has agreed a ridiculously huge discount. If it's less than 35% then I'd be very disappointed.

On IP, the IP is only worth something if you can sell enough goods to justify the cost of maintaining the IP. If, for example only, it cost 400k a year to maintain the IP, but the gross profit was 500k a year and not growing, then you'd have to ask yourself "what's the point" and put your money into something more lucrative.

As sales and profits grow, the maintenance of the IP is not quite a fixed cost, but certainly wouldn't grow at the same rate, so the IP becomes more valuable.

BB

*I kind of bear in mind that the figure of 1 Billion Yuan is probably just something which someone typed online, which AI tools then pick up on and base their reasoning on that. So, while I think that figure is realistic, there's also a small possibility that the whole analysis is based on the GIGO principle ( Garbage In, Garbage Out )

To add to that ... I think Year 1 should at least move us to break even, and could possibly see us become profitable.

100 Million Yuan is roughly 10 Million GBP. Waving a wet finger in the air, maybe that'd increase our top line by about a million, maybe 1.5 million, and our bottom line by between 500 and 750k ?

So, at that point, a very nice multiple, but not really a significant multiple, which would come later ?

Hopefully I'm being conservative with my guesswork.

Slam

Guesses are very much ball park, but you can come at it in two ways

Firstly, the "significant multiples" side. I'd say 3 times is the minimum for "significant" and 10 times is the maximum. Beyond 10, I think the wording needs to be stronger.

Anyway, assuming volumes reads across to revenue ( it likely won't btw ) that gives a rough range of 3 to 10 million GBP in revenue. All other things ( DSM cut reducing giving us a better margin and large volumes for BH reducing our margin ) being equal, which they won't be, that'd probably give us a gross profit of 1.5 to 5 million. So we might end up with an overall profit of between 1 and 4 million.

At the lower end, our current market cap ( 23 million ) looks about ballpark right ( 23 times future earnings ? ). At the higher end, it's not a stretch to say it'd justify a market cap of 100 million plus, but, for me, there are enough doubts around to not expect that to happen, and more importantly stick, until more concrete info is available.

The other way of looking at it is to take the possible 100 million GBP sales figure and work backwards. Assuming decent profit margins for ByHealth you need to come up with a guess for Cost Of Goods. For the sake of argument, say Cost Of Goods is 50 million. Does that make sense when the first set of guesses gives us 10 million in revenue ?

Personally, I think it sounds like it's in the right ballpark.

The elephant in the room is how are we going to fund the expansion and how much might we get diluted ? I don't think that'll be too bad. If it's needed, then raising, say, 5 million wouldn't be a massive dilution.

Anyway, for me, anything above a sp of 2p in the short term and I'd be thinking about reducing. Anything above 4p and I'd be seriously considering selling the lot and spending the proceeds ( no pockets in shrouds etc )

That's my take on it anyway, and others will vehemently disagree saying my guesses are worthless ( Spoiler : That probably overvalues them ! ), but, I always have my own exit strategy and, though they're shy about sharing them, think most people do.

That's more like it !

At some time, if we don't get any guidance ( over and above significant multiples ) from the company or a broker estimate, then, assuming those numbers are in the right ball park, people should estimate how much revenue we'd get from sales of Chinese products of 100 million GBP ( ~ 1 Billion Yuan ).

It's not that hard to come up with ballpark figures and how that might translate to eps and market caps ...

Re "Fingers crossed his AI Data is correct"

I certainly hope it isn't. If the market size in 2028 drops back to where it's expected to be in the first year then I'd be disappointed !

If that's not a translation error and actually reflects the AI analysis then there's still a bit of work to do on the algorithms

On manufacturing ... I think Alf's take is correct. As our requirements on volume and frequency increase then our importance to the manufacturer will also increase. I forget who the manufacturer is ( Gixer will know ), but there will likely be fixed costs associated with readying their plant to run a manufacturing run for us and it'll be beneficial to both them and us if we're placing bigger orders.

Interesting times, and hopefully we'll actually see us make meaningful progress this year and move on from being a "jam tomorrow" company.

Sphinx

Re "I suppose we can assume that the above was taken from the October batch !".

100%.

At a guess, roughly half of the October run ? By roughly, I mean between 40 and 60%, and though that's a rough estimate, it's a reasonably informed one.

Pumpky

Yea, I'd say that's about right and is the main reason why the H1 figures are, as we knew they would be, underwhelming. Conversely it means the H2 figures will be flattered a little by the delayed sales and it'll even out for the full year.

All that will just be minor stuff if we get orders through from ByHealth in 2026/27 though.

We had cash of ~520k at the end of Sept, which puts a cap on the size of the order we had delivered in October. Given Ford knew he had customers waiting I think the maximum size of that order, which was settled in cash, would be ~400k, maybe 450k at a stretch. Hence the need for another run in Feb.

BB

DP64 - you can buy red yeast rice in the UK. It's active ingredient is identical to one of the statins, so, as long there's enough of the active ingredient present, it's a good choice for anyone wanting a natural way of reducing cholesterol.

It's active ingredient does mean that the same caution needs to be applied as if you were taking a statin, in that you really need to know if your liver is functioning properly before you start to take it

BB