Member Info for HarChris

Anyone hoping to see multibags from the Team Resolute win alone is I think going to be disappointed, this investment rests on the management executing their plan over the next couple of years successfully. We are about to hear about the increased debt facility but going forward it's all about building trust with the market, continuing to win contracts and growing and maintaining the share price so there are levers other than debt to finance future growth.

Make no mistake though, the contract and in particular the investment going into the yards and the skills and technological transfer is transformational and strongly increases the chance that John Wood's ambitions are realised.

You don't work out PE ratios based on what you consider the cycle top to be, PE ratios are based on the expected average selling price across the twelve months which would not be $200k!

If we see bitcoin move relatively smoothly to $200k then we're going to see an explosion in hash, wouldn't surprise me to see 500EH/s (assuming there's the machines to meet the demand) and so 2.5EH/s would mine 135 BTC.

https://twitter.com/wsfoxley/status/1618976490498195456?s=46&t=fXYoNynv6xYFhL0MCmVreg

I get that jfk9 but as we all know, large government contracts tend to garner considerably more profit than say, the equivalent in the private sector. And sure, but even with tight margins this contract will almost certainly generate considerably more profit than Harl’s current share price, not to mention the growth that will be seen from the investment into the yards.

It’s simply short sightedness at the moment, much higher share prices will be seen with a bit of patience as more of the story unfolds.

And you just know there’ll be more people charging into GDR in the off chance that there’s some substance behind the speculation vs HARL that has actually won, confirmed, one of the biggest contracts ever to grace AIM!

How can you say this without knowing the details of the contract? What margins are you expecting from the FSS work and based on how much revenue? £700m before inflation? £800m? £950m?

I don’t see why profit (spread over six to seven years) wouldn’t far exceed the current market cap. Additionally the huge investment into the shipyards should be transformational… I’m here as much for that as the contracted work itself.

The higher the base formed before the sub-contract/funding rns lands the better the chance that we see 30p broken - that sort of level (~35p) is a far fairer and more sensible price to stabilise at for the time being.

To be fair though Mara’s drops are exaggerated considering their debt is long term, they basically get priced to fail when realistically they have years for Bitcoin to pump and recover.

I spent a while pointing out what good value they were at $3.50 yet never pulled the trigger on that one goddamn it! (Think Chaebol predicting $2.75 at that point made me greedy!)

There's a very simple reason why the likes of Mara (bitfarms and a few others too) have the biggest swings, it's because they are the highest risk. When bitcoin is looking hairy and question marks appear over bitcoin's medium term prognosis those with the biggest debt (collateralised long term in Mara's case, relatively high short term debt in bitfarms case) are worst hit.

Of course when things turn those that have seen the biggest sell offs see the biggest reversals but even with Mara's big jump recently it's still down more than most over the past year.

If you can catch the bottom with the likes of Mara then great but generally if you go looking for the bottom you'll have to endure very big paper losses first.

Harl reached 50p a share last year based on their potential long before they won their biggest contract (by a country mile) to date.

I'm sure we'll see that surpassed at some point in 2023.

Ps that paragraph has three sentences and the important bit is in the third, so don't switch off beforehand.

This is from the full year results in April:

'Trade and other liabilities fell to £17.2m from £36.8m in 2020. Trade payables and accrued invoices have fallen by £8.3m in line with reduced fourth quarter sales. The UK VAT liability has fallen by £16.7m to £0.1m in 2021 due to sales in November and December 2020 being substantially higher than sales in the corresponding months of 2021. These reductions have been offset by the increase in other liabilities, moving from £5.6m to £11.2m, as the balance now includes the two remaining tranches of the LTIP, which are forecast to be paid during 2022.'

So the question you ask yourself is which one is more relevant? Is it the longer 12 month time frame or do we take the most recent six month time frame and assume that that is now the new cash burn?

Do you think something has changed in H2 vs H1 that means novacyt was burning through £2.1m every six months and now burns through £12.6m every six months or was there an exceptional cost that won't be seen in 2023 and beyond?

I think you know the answer to that.

All we really need to ask ourselves is 'can Harl reach the £500m revenue a year level that John Wood has repeatedly targeted' and 'can they get there without tons of dilution?' If the answer is yes to both then Harl will be worth upwards of £350m and that'll be ~ 8X from here.

I think the FSS contract and the £100m investment goes a long way to suggesting they can achieve it.

PI, you're making lots of wonderful points today but you're doing it one sentence per post. Why not put all these great insights into a much longer message, repeat your 50p prediction a few times at the bottom of the post and then move on and go about your day?

£150m is 'back of the sofa' money for the likes of BAE - I would expect the government to block any takeover move of H&W in the next few years however.

Kilkenny, sorry for that, I did realise after posting it that I had made a mistake.

These results were a non-event really in the end of the day, more a case of as you were and the share price agrees.

'The CEO should leave' ... LOL

As for the sales update there's no doubt about it it was poor, revised guidance to £25m in June and hitting £21m means for H2 guidance was £8.5m and instead turnover was £4.5m, that's a miss in my book.

There won't be that much benefit from the bitcoin price currently as difficulty continues to rise and hit new all time highs - that being said it has outpaced difficulty in the past month so there's some relief which will increase further if bitcoin can push on past $25K.

Will GM have been paid in full by now or still another tranche to come in 2023?