Member Info for HarChris

It's capital intensive in regards to having to grow hash power just to see the same revenue, BTC being equal that is - if difficulty moved in alignment with BTC price over time then this wouldn't occur but more and more cash rich players are entering the space which not only shrinks Argo's slice of the pie but also drives up the price of the rigs.

The barriers to entry really aren't high enough for such a profitable sector.

In other words ~$37/kg means by the end of the year we will be a considerably bigger operation, the electrolyte plant will have been built and yet we will be in an identical financial position to a year before.

Whilst we are well financed for the time being a price higher than $37/kg will mean we will be tucking away funds to reach our medium term goal of 8400MtV. The less dilution along the way the bigger the reward for investors when we get there. If V stays elevated at a new norm of $45/kg+ then we might find ourselves able to self finance our way to that target and who knows what else...

Just trying to give an alternative view Genemeanie but I do agree with your sentiment and I think your email was reasonable and done in a respectful way.

Your post got a lot of recommends so it obviously struck a chord but I don't like the idea of demanding a short term share price even considering the circumstances... right now the share price is largely at the whim of sentiment and external factors outside of the company's control. For example if the DHSC dispute lands in our favour prior to the AGM then yes your minimum share price to support the company going forward will be achieved. Also covid might come back with a vengeance in April which reminds investors of the value here and sees the share price soar to £4 or £5, again not thanks to the board.

The last thing we want and actually the thing that will infuriate me more than anything is an attempt to spike the share price prior to the AGM in order to pull in the necessary votes. No what we need to see over time is a clear path to sustainable growth and an energy and a fight to get there over the next couple of years - not X price by X date.

Wolf, loads of business that require heavy capex just to stand still? Which are these businesses you speak of? Are you shorting them?

Having thought about this a lot recently I've struggled to come to a clear conclusion as to how I feel about what's happened in 2020 and 2021. On the one hand it was the responsibility of the board and in particular Graham to try to prevent shareholders losing their shirts, from suffering enormous losses. This is why RNS' that read' "company Y" notes the recent rise in the share price and sees no fundamental reason for the move, nor is it aware of any material developments beyond those previously notified to the market.' are put out to the market, they are an attempt to stem a rise that has got out of control and a share price that is unmaintainable.

On the other *that* contract signed with the DHSC was humongous and had it been realised in full would have left many times the millions in the coffers that ncyt has now. Also if the board were experienced/opportunisitic they would have leveraged the £12 share price and raised funds whilst they could, possibly as much as £150m to further shore up its long term future at the cost of shareholders at the time...

All in all the £0.5m buy from GM wasn't helpful but I think it was probably more down to naivety / personal enthusiasm than any malevolent attempt to hype the stock and make any personal gain and the whole rollercoaster was as alien to them as it was to most of the shareholders caught up in it.

That's my point Hexam although it's not been the case historically. If difficulty was aligned with BTC like it has been historically then the model doesn't require quite so much CAPEX to grow but the more recent unalignment if expected to continue changes that.

As things stand the big value and favourable risk reward only occurs after a steep fall in BTC or a 'crypto winter' that switches attention elsewhere and offers up the sort of prices that present potential bagging opportunities once again.

A key factor is whether or not miners are ever going to be back in favour and given decent P/E multiples or if the there is too much doubt over the long term business model... the halving cycle for example gives BTC holders confidence that BTC will rise as supply is squeezed yet miners need to see BTC double just to stand still...

If there is still faith and viability in the business model then there's no question over value at this price

That $37 AISC will include the capex for 2022 which if I remember right was just shy of $20m + $2m payable to Orion.

What bitcoinners use as a selling point others will see as suspect/a red flag - and that's the historical annual return. Saylor trots out the '200% CAGR' metric whilst also trying to sell bitcoin as a nice safe store of value. Well, despite some of the wild claims that were put out there last year during the peak of the bull run (seen $10M BTC within 10 years predicted by numerous commentators) there is no way that return can be maintained. I know that might sound counterintuitive but in times of trouble you want to be confident your wealth doesn't erode, if someone comes along proclaiming 200% yoy returns most will be sceptical.

To maintain this rate it is often claimed that bitcoin will absorb gold, with about ten years to completely swallow up its $12T market cap... so keeping an eye on gold over the next year or so will give an indication on whether or not those claims have any validility.

What is the investment case here now? From the outside it looks to me like you have an ever more saturated mining market where the price of rigs are ever increasing and the global hash rate is now rising irrespective of the price of bitcoin. There appears to be a very real risk that fast forwarding to oct 2022 and even with 3.7EH revenue is not too dissimilar to revenue today. Is that fair or am I missing something?

I'm sure argo are attempting to diversify and I know 10% of the HODL is going to Argo labs but I am seeing less and less of a case for investing in a mining company vs BTC directly.

Of course with any stock the most important thing is the price you buy at and Argo is very much a profit making company, albeit one that has requires a lot of CAPEX just to stand still. So what would be deemed incredible value here? Is the investment case based around the company's future in the digital asset space rather than as a miner?

The share price trending slowly upwards last week was an auspicious sign what with the ftse flying and the last bit of value finally being squeezed out of 'covid stocks' - it's no consolation to LTHs with high averages but it does give backing to the claim that the LTIP put a floor on the share price and things should now get better as we move forward and starting hearing more and more from DA.

IF Duferco are planning to offload then the earlier they do it the better... the last thing we need when everything falls in to place is a big seller blocking the share price from running freely.

Well peppering small sells is a sure fire way to push the price down, there's more than enough liquidity to just sell 12k shares in one go.

@durial of course that's going to happen, this is not the sort of business or the sort of sector that invests £100m in organic growth, most of the cash pile will eventually go to non covid acquisition. If we can utilise the partnerships, contracts, R&D, supply chain etc to turn over £50m with say £15 EBITDA then that justifies the current market cap alone and acquisitions are all value added.

I imagine though that the board will feel no rush to get their wallets out however, they basically have three years to build out the business and to get the share price to £7.70 to walk away with enough shares to retire a few times over.

You think someone with 15000 or more shares is trying to offload them carefully, 400 at a time? Is that what you would do if you wanted out of novacyt and you had 15000 shares or do you think you'd sell them in max two lots?

It's automated trades to keep the share price down on a day like today which saw decent buying.

There are many pharmas that have been bought out in the billions before starting phase 2 due to highly promising p1 cancer data, just because 4D hasn't caught anyone's eye doesn't mean avacta won't...

In one of his previous articles Myles gave lots of examples of big buyouts at early stages but I don't have the list on me right now. One might have been VelosBio, anyone else able to help here?

Whatever you may think Sangi this isn't going sub £100m and definitely isn't going anywhere near to 4d levels unless AVA6000 results turn out to be disappointing come June. I said after the interview that Alastair had basically signalled to the market 'no news soon' which gave traders the chance to dump and buy back in weeks later much lower, which is what's happening.

I only had a small holding here so decided to just hold and finally got the chance to top up/double it today bringing my average to 69p. Is the bottom in? Maybe, maybe not, I don't see the rush to buy back in but the upside to AVA6000 is too big to risk getting caught with one's pants down.

Interest will return here in the not too distant future.

I know it's a bit different when you're a micro stock but it's interesting to note that before covid at the backend of 2019 novacyt had £1.5m cash, £7m debt i.e net debt of £5.5m and a market cap of about £10.5m.

That's right net debt of £5.5m valued us at £10.5m... We were valued 7 times our cash despite having no ability to finance our liabilities!

Despite the details of the LTIP being a little unclear it doesn't change the fact that
a) there is absolutely no benefit to the board letting the share price slip any further and
b) the targets are considerably higher than today's price.

Too many on here focus on the fall as if that's an argument not to invest today, it isn't, it's happened. If you're sitting an average of £5 and you think the share price is only going to rise back to £4 do you sell out because you aren't going to break even? No that's ludicrous, you only sell out if you think you can turn that into more elsewhere (which is a big ask).

I don't know the answer to this but if there's any other LSE listed companies that have set their LTIP targets hundreds of percent above today's current share price and have the cash in place to get them there do let me know and I'll be considering buying their shares.