Member Info for fatherelmer

I'm looking forward to the following four RNS (which should all hopefully be out by 30th June 2020):

1. Confirmation of the first monthly tranche of funding from Lanstead (and the VWAP applied)
2. Confirmation of the (first) Chinese entity buying 5% of VRS shares and the strike price for this sale (or conversely the JV collapsing)
3. Publication of the 2019/20 Full Year Report & Accounts (not expecting these to be great - it's the commentary that'll be interesting)
4. Announcement of the first commercial order (ie Oil & Gas, MAS , CNCTArch) though this is subject to the world's ecomony restarting post Covid19

….what was the point of it as learnt very little new?

Perhaps this is evidence of the companies new strategy in terms of dealing with those that would seek to muddy the waters?

I was just mulling this over and wonder if the recent Lanstead deal sets a precedent / benchmark for the price that VRS will be looking for in the 5% sale due by 30th June 2020??

This would be a 53.8% premium to the prevailing price - which if taken on the close today would give an SP of £0.83. Which in turn would raise £3.5m for BVT and £3.5m for VRS (and also happily cause Lanstead to pay £389k under the sharing agreement in June).

...on the other board the foul mouthed poster with the sandwich avatar has been belittling VRS because none of the RNS contain any values, yet today we get one that talks about a minimum revenue level, over 2 years of $4.2m and so he now complains that this is not enough / too little - I wish some people would make their minds up rather than just make themselves look stupid (for instance DCTA only had revenues of €900k in the last 6 months) though it is quite fun to see them make fools of themselves :-)

A poster on the other board (terrytopper) who is generally bearish on VRS is bigging up DCTA on the basis of them having 2 ISO accreditations (ISO9001 and ISO14001 respectively) and saying this is what sets them apart and is important to their customers. They don't realise that they make themselves look like a wally as these are 'just' generic standards applicable to most businesses (ISO9001 = Quality Management System, ISO14001 = Environmental Management System) and VRS may even have these, and more eg ISO27001 (IT Security) or specific Manufacturing ones (eg for Aerospace) these of course are all good things - just don't be taken in thinking that they are any specific to Graphene because they aren't, it's just a lame attempt to mislead / misdirect following the significant news this week.

...during VRS presentation (on the new InvestorMeetCompany platform) the following interesting answer was given to a followup question in regards VRS capability / capacity to produce CNCTArches…..

Q22: Does VRS have that supply capability themselves? Or will they use a 3rd party to do that work?
Currently a number of 3rd parties but we are looking to bring in house as soon as we have justification

The answer makes me wonder if VRS may be looking at getting into the 3D Printing business should a large order come through????

VRS new Chinese JV Partners (may need to view in Google Chrome and translate the page)

http://egraphene.cn/index.php/product/index/g/c/id/3.html

Lucky, the most interesting thing in the RNS for me are the backstop arrangements - especially the one you highlight - as this basically gives the Chinese 3 months to buy 5% (or 7.5m shares) of VRS. at current values that is £3m, 50% of which will be kept in the UK.

So for those still claiming that China won't deliver anything we will know for definite, one way or the other, by 30th June 2020.

I also like the fact that there is a clear licencing model outlined and a minimum level of revenue set for the next 2 years - a level well in excess of pretty much every other Graphene company sales.

Robinhood, Neill is currently the largest shareholder (15.25m shares - though he has a further ca 6m options) however, once Lanstead have been issued with their shares (15.75m) they will be the largest shareholder with a holding 500,000 higher than Neill (it is incorrect to count his options as he doesn't 'own' the shares yet and they have yet to be issued).

Listen to the attached podcast (from 35:30) about Lanstead and a similar funding deal that they did previously with Immupharma )IMMU).

https://audioboom.com/posts/6683421-keras-resource-krs-african-battery-metals-abm-widecells-group-wdc-and-alan-green-on-imm-kaz

Just to be clear this arrangement does NOT guarantee funding of £6m - it just puts in place an equity financing arrangement for the next 2 years, with a fixed level, of front loaded dilution with no guaranteed funding amount. For example if the following SPs were held across the next two years VRS would receive the following amounts of total funding:

- £0.05 = £560k
- £0.15 = £1.7m
- £0.25 = £2.8m
- £0.40 = £4.5m
- £0.50 = £5.6m
- £0.75 = £8.4m
- £1.00 = £11.25m

Apologies there is an error in my post (I got too fixated about the £0.40) the subscriber of course would make money at any price above zero eg at £0.05 they would be c. £224k in 'profit', though of course they do have an incentive to support VRS to grow the SP as that way they make more money. I wonder if they will start to drip feed the 15.75m shares from date of Admission or wait until the funding actually kicks in 2 months later?

Why would the subscriber end up with the entire company - they won't, they are only risking their £6m?

On the other board there is a lot of nonsense being posted, based upon some erroneous figure of 40%. The reality here is that below an SP of £0.40 neither party 'wins', and only above an SP of £0.5333 do VRS 'win' and so it is in neither parties interest to see a failing SP. At todays current SP (of ca £0.25) VRS would get ca £118k of funding (though have missed out upon a further ca £132k worth) whilst the subscriber would be ca. £2m down on their investment should this price be maintained for the entirety of the 24 month agreement.

Whilst todays RNS is not great - we all knew that a fund raise of some sort would be coming this year (probably within the next 3-6 months) - this at least does give some potential upside, whilst encouraging the subscriber to be supportive of an SP at £0.40 or above. It also gives VRS something very important - some more time in the current challenging environment. The 2 big downsides are the lack of certainty in regards how much funding VRS will actually receive and the fact that the largest individual shareholder (will no longer be Neill) will not necessarily be in it for the long term and so there will be 15.75m shares coming to the market over the next 2 years, which may depress / hold back the price.

Next time someone asks (when claiming that they don't exist).... +86-10-81334416

I see the usual suspects on the other board are continuing to rattle on about the low value of VRS Graphene sales and the fact that Graphene is headed for commodity pricing....this of course neatly ignores a couple of key points:

1. No companies are really selling Graphenes in any great quantity (eg XGS are really a plastics company) and so this is a poor metric to use (look also at FGR, etc - I posted about this a few weeks ago)
2. The commodity pricing argument has some merit, though not all Graphenes are the same and as such may have widely differing values. It has also been said that the VRS approach is more akin to a TCO approach ie looking at the overall gains not just a single input cost / variable, and that pricing may / will then reflect this
3. As evidenced by 1 above the VRS strategy (and also followed by DCTA too) is to compensate by talking on more of the (higher value add) supply chain hence the launch of products such as #Polygrene and #Biogrene though this of course takes longer to develop, but should yield significantly greater, and more sustainable, returns in the longer term

Has now updated his LinkedIn profile and is listed as the 'Head of Product Development' at Versarien Technologies Ltd, I wonder what products his brief covers (including the CNCT Arch obviously) hopefully the company will let us know soon - perhaps via their new monthly Q&A??? Looks like Versarien are trying to move further up the supply chain again....

https://www.google.com/url?sa=t&source=web&rct=j&url=http://www.southampton.ac.uk/assets/sharepoint/groupsite/Administration/SitePublisher-document-store/Documents/modernising-composite-materials-rail-infustructure.pdf&ved=2ahUKEwjguY62zu3nAhU6BWMBHdsNBcg4ChAWMAt6BAgEEAE&usg=AOvVaw2AH6Km64ZAdWqxcVbKP80v

Jdubya, bit of a mixed RNS for me - and can't say I'm surprised by the market reaction:

On the negative side:
- it shows that the cash position is worse than we thought so if the orders, or Chinese investment doesn't come soon, the fun will really begin
- even if the Chinese deal does occur will they be able to get any / much of the cash out the country?
- no mention of Orders from O&G, Aerospace both highlighted as Q! 2020
- reminder that VRS aren't really in control of their destiny (they need the end customer to actually order)

On the positive side:
- Chinese deal may still happen (with I guess finance coming from the Graphene Parks Construction Company)
- good updates WRT Gnanomat, also good that they have been able to survive with less cash than envisaged
- MAS moving ahead
- Polymers moving ahead into next phase of testing
- AECOM CNCT Arch moving ahead (potentially in multiple markets)

To me it's the cash position that is really driving the SP (alongside unrealistic expectations of PIs due to the previous 2018 spike). One to ride out I think, as general market sentiments don't help (especially given the links to China)

Jdubya, it's the LogLorry1 avatar I was talking about - don't know their name though I think (on the other board) it might be Tim Kempster as I think they also say that ClubSandwich is Ian Webster (who comes across as a very troubled individual with potential mental health / anger issues).

I see one of the chief truth twisters is focusing upon the the arch and how it may be worth very little. As always the posts are written in a logical, and convincing manner, and contain a number of facts amongst the spin and half truths, namely:

- that GnPs will become commodity priced (true)
- that one company (Nanoexplore) are targeting a low price of ca. $10/kg (true)
- they suggest that the same company are selling significant quantities of GnP, given that they are mainly a plastics company and don't declare GnP sales (in fact the company admit that they are still working on developing FLG) and so this is all speculation / spin as they don't know how much GnP are sold as opposed to plastic
- they imply (by not saying otherwise) that all GnPs are the same and deliver the same end use benefits and as such imply substitution is possible (not entirely true)

So whilst the above points give plausibility to their argument, they conveniently miss out one key point - which has been recognised by VRS (and Nanoexplore) - which is to counter the commoditisation / substitution issues you need to move up the value chain and not just supply the GnPs, hence in the case of VRS they are not supplying GnPs but a functionalised product Polygrene. This product will sell at premium prices (though these too will deflate over time) thus completely changing their argument (and not helping their story).