Member Info for DRB83

Regardless of who you vote for, if they are not corrupt walking into no.10 they will be by the time they get their feet under the desk.

Corruption is rife in politics and it is we peasants who foot the bill.

If the write off stock is out of date I would suspect it would be rendered useless. However, the comment in the RNS stated that the company would continue to look for other ways to use the inventory. What can you do with out of date assays and surely the machines can just be resold.

Thanks for clarifying HarChris. Sir Digby, a good reminder of the governments plan to end free LFT's from Jan 22. Mmmm interesting. Surely they won't do it but nothing surprises me with this gov.

https://www.google.com/amp/s/amp.theguardian.com/world/2021/sep/17/coronavirus-plans-to-end-free-rapid-tests-in-england-reckless

If that is the genuine plan then I guess we won't be using our antigen LFT's as leverage in the negotiations. Oh well, still plenty more to go at.

PROmate
Winterplex
SNPsig
Antibody tests
Machines
Co-Prep
+ Many more

Take your pick but be quick.

HarChris can you define your interpretation of mid term please. I'm thinking £5.70 gets blown away on favourable dispute resolution. Hopefully this year.

Thanks HH max and extra. Lots of good points which confirms why I am bullish on UFO.

Production costs won't be close to the majors we know that but I don't believe it will be close to other minors with deeper ore so $50 seems to be a good estimate for now.

In terms of the selling price then I can only see this being north of $100 come 2023 when Han**** is likely to be producing. We also have some very high grade ore. Yes China and others will try to manipulate the price along the way but even if it settles at an average of $120 then thats $70 operating profit per tonne. 1mt per annum is about 80,000 t per month which should be more than doable. What's that about 4 or 5 truck fulls a month. One per week. So 1mt per annum is $70m op profit from Han**** alone. Han**** I'm sure will grow but we'd have at least 10 years production from that one tenement. Plenty of flex in there to account for more downside. Admin expenses I wouldn't think would amount to much and the cash conversion on the EBITDA will be around 80%.

I assume shipping costs are not included in the production cost so does anyone have an angle on transport costs. I expect the miner bears the cost to the port and the buyer the cost from the port. Anyone know how that bit works?

Thanks Hillseeker, seems we are both on the same page.

InvestorSteve.

Theory A would require holding off until after Jun 30 2022 as before then they would have to include in 2021 numbers.

I think theory D has already happened and Theory C is what they have arrived at. The problem now imo is agreeing on quantities and values. Imo GM is hard balling as are DHSC which is dragging this out way longer than necessary. DHSC have nothing to lose by hard balling.

In terms of what is an acceptable outcome, it depends on how much the dispute is affecting the future revenue flows. Who knows, had we agreed a middle ground to supply more PROmate in replacement back in April then we may just have won another 1 or 2 sizeable contracts with the DHSC. Then there is the reputational damage that may have been caused with other governmental or private customers holding off due to uncertainties around our product offering. We don't know and probably never will but if the dispute has cost us several large contracts and a large foothold in the industry then the £30-40m sacrifice you talk about would be peanuts in comparison. GM would be closer to this than us and I think he's let his heart rule his head and hence why he's on his bike. Maybe it will all come out in the wash over the next 12 months.

HH, to me deramping is being constantly negative with little to no substance to back up your claims. Anything else is just caution in my eyes. I am relatively new to this BB and up to now I can see you are rightfully cautious.

Appreciate the reply HH. You raise some good points. I read somewhere recently that the majors can produce at a measly $20-30 per tonne. Minors at $100 seems very high, I would obviously expect some economies of scale benefits for the minor but 3-4x seems heavy. However, I'm not sure so let's be prudent and go with it.

If the costs were so high for us then surely that would open the door to a JV or a buy out/earn in from one of the majors. Therefore at worse case we would still recognise some benefit of owning the rights to these tenements.

You also raise a good point that whilst $20 profit per tonne to the majors wouldn't be sniffed at, for us it would be worth multiples of this SP.

Agree 100% on that Kaeren. I said something very similar only a few days ago. GM does not strike me as an out and out business man (trying to be polite). I am very hopeful that DA is the absolute opposite as that is what has been missing for some time now. I look forward with great belief at seeing DA's strategy laid out before me. Bring it on

In terms of this year. I think it is very safe to say that the £100m revenue will come in. Let's exclude the DHSC debacle for now.

2022 forecast should contain £50m from Covid which personally I believe is very conservative. But we'll go with it. Considering Microgen haven't even got out of bed yet so far in 2021 I would expect the bod to have included something for the rapid tests in the £50m workings. Let's assume a measly £10m per annum.

That means Primer Design will contribute about £40m covid revenue in 2022 (that's 40% of 2021). Feels low considering 2022 is only 3 months away and we're seeing an average of 35k cases per day soon to be 6 figures imo. Let's also note that we won't drop to 50% in January. It would phase out over the year so Jan/feb would be same levels as Dec21, Mar would be 90%, Apr 80% and so on. That means ncyt are forecasting next winter to be at around 10-20% of this winter. I don't see it.

Then there's travel, it feels like ncyt are forecasting travel testing to disappear because you either have the requirement or you don't. If it's still applicable to day 2 test then next summer will be a huge market. Millions and millions required and that's just day 2, if its still LFT then Microgen should be all over that making the £10m above look like loose change. So I am assuming ncyt are factoring in worse case that no testing required full stop, other countries no longer bothered because everyone will be vaxxed. Therefore no private travel testing market anymore next summer. That would be great but no way imo.

Then there is the US. They must be setting that up purely for post covid because the £50m covid revenue is more than likely going to be covered off by the UK and Europe alone. Covid is huge at the moment in US and will be working its way up north as the weather gets colder. Ncyt are forecasting nothing in terms of 2022 sales from US. Again, I can't see it. We will be pumping the US hard right now and when we finally get the relevant approvals then happy days.

I can go on but I have proven my point which is that Ncyt haven't got a clue how to forecast this covid situation so they are absolutely low balling it beyond belief. If covid disappears by summer 2022 then yes, £50m will be doable. We would have already by then began the transition into non covid products which would cover the remaining £50m we believe but still to be shown to market. More realistically Covid will still be here next summer and winter and that £100m will forecast will be met by covid alone. Then add on your non covid transition as the R&D team begin to focus on other areas. Then we have the hundreds of RUO assays that we will convert to CE mark. Imo £100m will be toast. All imo but will be very interesting to see how 2022 unfolds.

Agree investorSteve totally but I think this is another reason why we haven't seen the II's coming back yet.

By their own admission, Covid sales are expected to be around £50m in 2022. Novacyt have not given anything significant to the market to say where this other £50m+ is coming from. The market especially in Novacyt's case does not like to read between the lines like you and I and us. They like it in black and white. This may not happen for another 12 months.

In my very top level simplistic view:

Step 1 - Favourable dispute resolution £8
Step 2 - 2022/23 forecast to the market £15+

Obviously, a lot can happen in between but these feel like the 2 biggest things holding us back right now.

A point on your post however, I would have expected the fundamentals of iron ore to be bullish given the level of quantitative easing that has been applied over the last 18 months. What's peoples view?

Also, even at $100 the economics of extraction of an open pit mine of 10mt+ should give quite a substantial NPV to someone even if not UFO. Again, any thoughts welcome.

I'm thinking:

1. Low capex costs
2. Relatively quick to get operational
3. I would expect a low cost per tonne to extract. Less than $50
4. Low transport costs as I believe there is a fairly local railway.
5. Selling it shouldn't be a problem as demand should remain favourable
6. As it's all at surface then there should be very little constraints on how fast we can produce which will help keep the cost per tonne low.

Can anyone expand further or correct me on any of the above?

I find it best Chris that if you feel someone is ramping just rein them in a bit with a reality check of what potential downsides there are to their statement whilst acknowledging the potential positives. That way you can have a constructive debate with the group which is a benefit to all. Otherwise you lose the crowd and quite often their hard to get back and what may be very valid points you have are lost in the array of 'troll' allegations against you. Same applies to derampers.

People that are constantly negative even in the face of obvious positives are trolls no 2 ways about it.

People who say they are negative to protect other potential investors from losing money are just kidding themselves and quite insulting to all investors.

What investors need is substance behind the negatives and substance behind the positives. This allows investors to make the most informed decision for themselves.

But you don't have the players or cash pile to be able to compete. Hence you're bottom. Sorry

All sounds very positive. It's like he's coming in to manage Chelsea but they're currently bottom of the league and with a huge cash kitty to buy the best players. Supporters expectations are mid table finish at best. If he makes a few tweaks to the first team and buys a decent player or 2 then most of the competition won't stand a chance. They'll be a few that keep us on our toes but ultimately expectations are likely to be smashed and we'll be playing CL football again next season.

You have to envy DA's position really. If he's good then he can't fail. Whoops! I said it.

Tymers, I am not after the justification for the drop just a discussion with some of the more prudent or pessimistic people here around why 0.8p is on par or even much less in some peoples eyes than the current fundamentals.

I will however oblige to your request. I have done this several times already on previous posts so I won't regurgitate what I have only recently previously said. Instead I will point you to the TPI report that I am sure you are aware of that back in Feb valued UFO between £40-80m. Since then we have acquired an additional 40% more of Hamersley and derisked the Han**** tenement with the 10mt JORC which will most likely grow to 20mt by the end (this is more than the best case that TPI had). All of this would at the most conservative revaluation put us in the £100-180m range.

How do we translate that into the SP. Drill, drill, drill. Plenty of cash to get us higher than the previous placing price before another placing is required. Placings aren't necessarily a bad thing. If you have the ability and the opportunity to utilise the cash from the placing to develop and grow the fundamentals then that's a good thing. Let's say that before the cash runs out we are able to move the JORC upto an indicated resource. Get some good drill results from EH. Get some quality results from Brockman. I would expect the SP to rise well above 1.1. Any placing I would expect to be over subscribed meaning we don't have to give too much away to get the funds needed for the next steps. Ideally, we have the II's queuing up and we manage a placing at the then current SP and warrants for much further north.

Therefore the current 0.8p buy in price is a very good deal imo. Let's see

Firstly, I certainly agree that people should be very careful when it comes to investing.

With all do respect Tymers 12 months ago UFO were 4x the SP they are now and we now have a further 12 months exploration behind us. To start, Han**** has a JORC. All be it inferred but nevertheless a JORC. 10mt of iron ore puts the SP at 4p on just this alone imo. There is clearly risk there but imo given the current macro economics and the positioning of UFO the JORC is more likely to grow in size and progress through the ranks than it is to fail.

You can't compare UFO of 12 months ago at 3p with UFO today at 0.8p.

The technicals will do as they will but fundamentals shine through in the end. I still invite anyone to state a discussion point as to why UFO is not worth north of here based on fundamentals. I've tried and fail every time.

Agree with that Neil. At these prices it's about building up your position. Accumulate your shares when you can and hold. All imo

Yep. RUO. Just imagine the demand when we finally get these FDA approved.

From memory, IT-IS are no where near capacity on these machines so what's holding back the sales. Could be price although they are 'exceptional value for money' or the assays not being approved for clinical use. Still work to be done here but I wouldn't mind another acquisition like IT-IS