Scancell founder says the company is ready to commercialise novel medicines to counteract cancer. Watch the video here.
There's no two ways around it they are in a pickle now, a right bind.
It's clear in the way they put the table of current assets vs current liabilities front and centre of those results that this is a major risk now. On paper it looks fine - £7.1m vs £3.8m - but as with most things TGR the reality is a lot worse.
TGR are totally dependent on receiving £2m from the Madagascan government which we now hear is due to 'national budget constraints'. It's a pretty worrying thing to be relying on a tax rebate from one of the ten poorest countries by GDP in the entire world... and then you have tax rebate also owed by Mozambique, also in the top 10 poorest countries in the world.
Cash burn has sky rocketed with at least £810k cash burn between mid Jan placing and March 31st and now we know they have £1.13m due to mature within twelve months.
TGR need to find significant cash just to continue operating, cash to employ a credible CFO and cash to cover the debt maturing otherwise they are relying on the Madagascan and Mozambique government to stay out of administration. All that against a £5.5m market cap.
Segun has confirmed many times that the five year tax exemption applies with three more of those years still to come - it's in many of the THX documents including the slideshow on Segilola: 'Fiscal incentives include 5 year tax holiday and duties exemptions'
In the recent Investor Meet Segun made the point that even if there's no increased mine life at Segilola (which isn't going to be the case) there's still 3 years and 300k ounces to be produced at an AISC of around $1000 so at a gold price of just $2000/oz that's $300m of free cash flow to be seen.
Now imagine it averages $2400/oz over the next three years, that's ~$420m free cash flow without finding another ounce at Segilola - the numbers are staggering against a $118m market cap. So much could go wrong to still end up with more cash than market cap, and if everything goes right (MLE can be as much as seven years, Douta mine to be developed, Lithium exploration) well let's start talking blue sky.
Completely agree. All is not lost here just yet, if improvement were to be seen from this point forward even if further funding was needed in early-mid 2025 it would be well supported at a valuation higher than the current one but the question is, how likely is that improvement to come? And it really needs to be a significant improvement with prescriptions back on a 30%+ QoQ growth trajectory.
They've bought themselves a few quarters more time but they are very much in the last chance saloon territory now otherwise a change in management is inevitable and heavy dilution to get back on track.
I'd rather watch from the sidelines and enter at a higher level if that significant progress is seen as I think it's unlikely under this current management.
I suspect NCYT are too close to the dispute resolution to be actively pursuing m&a however I'm sure Lyn has at least half an eye on developments at Genedrive and if that funding falls through / GDR end up in the same place six months further down the line re cash but with NICE approval progress (expected July) they'll be a potential target.
If you can't see that that update was about as poor as it could possibly be given what we already know then there's no helping you.
Point 1 - how on earth were the sales incredible? We already knew H1 revenue was ~£3.15m (4785 x £658) so the second half of the year, what was unknown, brought in ~£1.75m. Incredible?
Point 2 - good news re stepping down as Executive Chairman agreed.
Point 3 - what was unknown was H2, H2 production was only a tad higher than what was being seen two years ago when installed capacity was only 12ktpa. Another way to look at it, q1 target at the start of the year was 6100T-6500T, they only just achieved that fo the entire year!
Point 4 - We've just seen nearly £1m burnt in six weeks 9(Jan 17th placing of £1.045), even if they eventually receive the £2.6m it barely covers one quarter's cash burn.
Point 5 - I was surprised by the big buys, one of the fairly big sells on open was mine, the last of my holding.
I've been vocal over the past week but I was always ready to support Shishir if he proved me wrong in this update but it was a hell of a lot worse than I expect and that's saying something.
Gl to holders, it's going to take some real skill to turn this around, to ever get back to the dizzy heights of even 20p.
£1.045m raised Jan 17th, £189k left by the end of March, I suspect absolutely nothing left now.
I suspect debts to key suppliers are racking up now and there's the CLN coupon to be repaid in July. If the rebate isn't received by then and no further funding do the CLN holders pull TGR into administration?
Thanks for sharing jk, I’m sure most of us would be delighted if we see half of that broker target in the next year - I certainly would!
A reminder that end of June 2023 there was €212k cash and €5.1m debts maturing within twelve months - they've all been paid down now I believe without any raise or cash injection, just profit and extra stockpile so that should give a sense of what the full year numbers are going to look like.
If cashew operation flips from cash drain to cash generation DKL will quickly be making profits greater than today's market cap.
Do explain what trend you're seeing? Production was 2350T in Q1, 2150T in Q2 and an average of 1075Tpq in H2.
That's against supposed capacity of 7500T per quarter and utilisation of 75% by Q3. The miss is more than anyone truthfully will have predicted.
They're still generating quite considerable cash month on month from the CPO operation so in a sense it's steady as she goes.
Full year results in June should look quite positive showing a healthy profit but of course everything rides on cashew progress through H2.
There will be money to be made if you're nimble and get a bit lucky with timing but it's high risk for a number of reasons. I might look to buy in with clarity once the placing is done and dusted but not beforehand.
Anyway I won't talk about gdr again as it's distracting from some excellent recent posts on here... I'm going to report Poidster's post from yesterday later so that nobody misses it.
For me it's a huge risk because they are signalling that they need at least £6m and yet they aren't close to raising that. Today's update:
'Accordingly, the Company needs to raise a minimum of approximately £3.9 million (gross) from the REX Offer and the Open Offer so that the Minimum Proceeds are raised.'
If the share price goes below 1.5p it will look attractive but will mean nobody takes up that offer and then they will possibly go bust - i'm staying out.
2600T production in H2 is appalling.
If the share price/market cap wasn't so low already this would fall 80% today but there will be some consideration for the high quality Mozambique assets I suspect.
The business has completely stalled with no cash left waiting for tax rebates.
Kaeren my guess is that it's a couple of factors but largely this:
'Should the Company receive the net proceeds from the Firm Placing but no proceeds from the Conditional Placing, the Rex Offer or the Open Offer, its cash runway will remain extremely limited, it will only have around seven weeks of working capital and the Company would urgently need to seek further financing which may or may not be available at all or, if available, may be on commercially unacceptable terms and could lead to more substantial dilution for Shareholders than would be the case under the proposed Fundraising.'
So £2.5m (gross) is equal to 7 weeks working capital? That's pretty extreme even if it's partly for a renewed r&d drive. There's also still a lot of uncertainty as to when significant revenues would start to be seen and no timelines for any cash flow break even goals. So an interested buyer was still probably looking at offering around £10m to be accepted by shareholders (they wouldn't have known the alternative was a 1.5p placing) and then immediately put in another £6m for initial funding.
If like you say the products are deemed so good that wouldn't be an issue for a major but for any midcap company, even cash-rich novacyt, it's a risk.
i genuinely foresaw a 1.5p raise, well i wrote in my trading/investing notebook '1.5p-1.75p raise' but it's hard to share your thoughts on that sort of thing without looking like some ******* 'wanting to get in on the cheap' so the most i did was share what went down with yg. in this market it's almost never a good idea to get in before placing news however much it's already fallen, at best you might be on the right side by 5% but at worst, well 70%+ it can be.