The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
https://www.investormeetcompany.com/itaconix-plc/register-investor
1600 BST
I’m looking forward to hearing JS on the investor call tomorrow. Maybe he will give away a bit of info on one of the known unknowns, which no doubt were closely appraised by those IIs who put in the recent £1M+. Still time to submit questions!
Just put in my question:
“ Hello John, I am a long term holder and wanted to ask where/how the recent capital raise will be deployed and looking much further out do you see the bulk of company revenues coming from own production or licencing deals/royalties?”
EyeOB I’m with you in a ramp being like a red flag - I love the positivity, the story, the strategy delivery, the making of product, the sales, and the rapid progress to break even BUT all of these belong on a realistic timeline, which is why I’ve said in the past my target is around 20/25p by end of 2022, which I think is realistic. If I’m blown out of the water before that, that’s fine too of course!
Put in another £5k myself this morning. I am finding this a fascinating period in the company’s timeline. We’ve had a 5 month trading update - very positive (though not positive enough for some!) - a £1M+ fundraise at 12p. We know a LOT, but I guess some of the institutional investors (eg. IP Group) have a better handle on the “known unknowns” than we do. The half yearly update will I reckon deliver another spoonful of cream and I really hope we get a view on what the new funds are being used for (eg. extra production capacity, which is the ultimate successful sales validation). Last but not least, what really intrigues me is what is going on behind the scenes on NPD. I have tried REALLY hard digging around to find stuff on paints, packaging, et al using itaconic acid derived polymers, giving a pointer to ourselves - but no joy. It is being very tightly managed in my view. Onwards & upwards! DYOR
I see this as VERY positive. With it JS has a bit more headroom - sales growth has been affected by COVID which has pushed out cash generation - and IP Group gives firm affirmation of the company strategy, knowing that the £1M+ quid they’ve just invested will be worth a LOT more in a few years.
I do enjoy a bit of detective work Wacca - but hats of to the real experts parob Thordon AJP et al
Anyway, here’s a bit more: I’ve discovered that Itaconic Acid Market pricing is around $1900/T and I reckon - based on 2020 full year numbers plus my calcs and assumptions (they may be way off!) that we maybe receive a container (22T in big bags) of raw material Itaconic Acid every fortnight. That equates to some 572T annually. We also know that the Newwave agreement guarantees we supply to them of 1M 1bs (ca 450T) of our finished product over 2 years (225T/year - probably backloaded). So volumes kind of stack up. What I don’t know is what 1000Kg input corresponds to in Kg output of Itaconix polymer. Happy to hear other takes on all of above!
In any case, it seems clear to me, with my calcs, this is another pointer to continued significant growth and factory capacity utilisation being at the forefront of ops management thinking. So I’m looking forward to the half year update and hoping for some snippets on:
1) factory capacity increase
2) split between own factory generated revenue and revenue from licencing agreements
Here’s the link to the IA price point:
https://www.scienceopen.com/document_file/15a2c30c-e29d-4784-93ac-24ed199d4a5c/PubMedCentral/15a2c30c-e29d-4784-93ac-24ed199d4a5c.pdf
I’m looking forward to our first major announcement on the BIoAsterix product line for packaging.
JS said this last year: “This collaboration is an important step for us to assess the commercial potential of our initial BIO Asterix additives. Although it is too early to consider the potential impact on revenues, I am optimistic that our bio-based ingredients will find valuable commercial use in biodegradable packaging in the coming years.”
Valuable commercial use...optmistic... I love it when our cautious understated CEO feels able to use those terms.
I see our Newwave tie up is delivering product into ALDI USA.
https://corporate.aldi.us/en/corporate-responsibility/supply-chain/california-transparency-in-supply-chains-act/ca-chemical-disclosure/
I wonder we sales into ALDI Europe might start?
Thanks faramog, I appreciate your thoughts. I like the BMN story - so I’ll be here for a while and I look forward I hope in my own small way to contributing to a positive BB discussion as and when.
Sorry faramog, i missed a bit; to answer the second part of your question: sell down strategy currently none, as I’m considering additing more to my 200k holding. Exit point: good question and not yet 100% sure, but given where we are just now I am comfortable with a 5 year timeline on delivery of the company’s vertically integrated vanadium strategy. I used to be in the precious metals business and saw and liked the vertically integrated business models of companies such as Umicore and Johnson Matthey. If other events happen in the meantime MY strategic timeline will of course be reviewed.
Hi Faramog at the moment I hold around 200k - I am a recent investor here - and am thinking of investing more. So I am genuinely interested in straight answers backed by reasoned argument from other LTH’s.