Member Info for Hexam

"Capex is due to fall massively this year"

Yes, indeed. So it won't be one reason why net profit is higher than cashflow (like it was in 2021 and 2022 when huge capex inc. acquisition spend was the main reason it was). Capex for this year may even be a bit less than depreciation and amortisation but it won't be by much so net profit and total cash flow ought to be pretty close unless there is a big change in working capital or any more large impairments.

They haven’t said they will be cash flow positive just that they are targeting a positive Free Cash Flow which excludes some items of inflow but mainly of outflow.

If they are cash flow positive in total (not just FCF) then there is a reasonable chance they will show a net profit as it’s swings and roundabouts between the two measures and ultimately they are the same (just the timing differs). For example in the last two years cash flow was higher than net profit but in the previous three years it was the other way round. A lot depends on the level of impairments, capex and changes in working capital during the year which are generally the big ticket, volatile elements that differ between the two measures.

They should make healthy profits from just sales regardless as this excludes a lot of expenses.

“But please don't think we're all naive idiots blindly believing in alchemy.”

I don’t, just some. The ones that think anybody posting any doubts is shorting. The ones who think this is a hot favourite rather than a lively outsider. The ones who just abuse anyone daring to mention those risks.

Positivity is great but when it morphs into worship to the extent of trying to block out any alternative views it is not healthy.

I’m sorry you think I’m condescending. I try not to be. I admit though that I can’t help being contemptuous of some on here but that’s because I see them as dangerous in the way they peddle lies and shout down any negative view however well reasoned it might be.

Sounds like you have the perfect attitude there AWL. You know the rewards are very high, potentially life changing for many, and are positive about this but you also recognise the risks are correspondingly high and so the chances are slim. Unfortunately quite a few on here are so blinded by the first part that they don't see the second part.

I hope that this, or your other share (or even both!) come good for you as though such high risk stocks rarely deliver there are a few that do and that's what keeps people interested! Maybe one of yours is the jackpot! Good luck.

“Isnt Method ABCDEF .. all aimed at BTC miners ??

Yes, but if none of them work then it doesn’t matter at all what BTC is valued at. And if method B does work then QBT will probably be a billion dollar company - unless BTC absolutely crashes.

So what really matters is whether method B works or not. Everything else is just noise.

Btw BTC is an intangible asset full stop, however you look at it (tried ‘touching’ a bitcoin)? It does have a value but that’s different. Just look at the accounting rules or simply google it. As I say though, it doesn’t matter.

Also if you could point out what the ‘main play’ is here if it’s not method B or something else mining related that would be useful (something tangible and specific preferably rather than just say the buzzword ‘blockchain’).

To be honest I just didn't understand at all the phrase 'bearing no correlation with tangibility' so clearly you are far cleverer than me since that went straight over my head.

I know art and classic cars are both tangible assets whereas BTC is not but I'm not sure how that helps?

You seem obsessed in comparing BTC and art but they are worlds apart. I can't see anything they have in common apart from neither having any intrinsic value (as opposed, for example, to classic cars).

All academic anyway as the only thing that really matters for QBT is whether Method B works as claimed. If it does then billion dollar company it is. If it doesn't work at all then they are heading for oblivion. If it works but not as well as claimed then the value will be somewhere in between. We all have our view but none of us knows for sure and any talk of BTC or blockchain in general is just by the by.

Nothing at all like art or classic cars. Those are valued on perceived beauty or rarity/uniqueness. All BTC are the same and there will be 21 million of them.

BTC may continue to have a value, and possibly an increasing one at that, but comparing to art (or classic cars) is a lousy analogy.

"how much of that loss was actual cash"

£100.9m was the net cash outflow, so still pretty chunky (EBITDA is obviously very misleading as it excludes a lot of cash items so should be ignored).

This was also the reduction in net debt (as no change in the debt side) with total cash of £230m at FY end and borrowings of £325m. So gone from net cash of £5m to net debt of £95.9m.

(Total net assets are £280m, down by just over £120m and includes over £100m worth of intangibles.)

So the balance sheet is a lot weaker than it was but still pretty healthy and I don't think the alarm bells are ringing quite yet despite £75m of the credit facility not being extended beyond 2025. This will reduce cash by £75m early in 2025 so if they have another year as bad as last year then cash will be worryingly low (around £50m) BUT they are targeting positive FCF in FY25. So total cash outflow should be relatively small as long as they deliver on this and may even be an inflow depending on how positive that FCF is (there are certain cash flows excluded from FCF like lease payments and interest).

In short they'll be ok if they deliver but in trouble if they don't and this year actually turns out as bad as last year.

Notready1 filtered.....Don't want to listen to him telling us why he's filtered yet another poster which is pretty much all he ever does. Oops, now I'm doing it.......

I think we just have to agree to disagree then Mikey as I think the positive posters are just as prolific on this board and on the whole are far more unpleasant as their posts more often come with abuse. The doubters’ posts are also much less ‘spurious’ being usually keener to discuss and challenge the company in detail rather than superficial soundbites, generalisations, repeating what the company has already said or just talking about other posters rather than the company at all.

As it happens posts seem to have dried up somewhat so under the definition you supplied (unnecessarily) they aren’t incessant at the moment at all - negative or positive.

I think AWL probably has the right idea though so I’ll leave you to it :-)

OK, I'll put it a different way.

I don't see why you should complain about posters that keep posting negative comments and that they should be jumped upon for doing so when there are just as many posters that keep posting positive comments?

If you don't have a problem with a balanced view then why do you only have a problem with those that usually air negative views and not with those that usually give positive ones.

And even if some of those negative views come from people who have shorted the stock then what's the issue? Every stock gets shorted one way or another and all they would be doing would be giving an opinion in line with their investment choice - which is exactly what the rampers do?

Surely it's not the motivation of posters that matters but whether they distort the facts or not and that is something which both sides are guilty of, and, in my view, what the 'ramping side' is guilty of more (particularly certain individuals).

Basically it sounds like you are happy with a balanced view - so long as that view is entirely on the positive side of the scales i.e. not balanced at all.

The positive comments are also incessant and from multiple accounts so not sure what your point is.

Fair enough Will but it seems to be a common thing on these forums that it's perfectly ok to post positive comments when something good is perceived to have happened but not to post negative comments when something bad is perceived to have happened. Obviously we can argue all day long about what is actually good or bad but I think everybody has a right to say whatever they like about their investment (or even if they are not currently invested) and that includes bemoaning the lack of information.

I do agree shareholders shouldn't expect to be spoon fed all the time but the odd morsel now and again doesn't seem too unreasonable to me - especially regarding the very claims on which many shares would have been bought in the first place.

Good to know you're happy to be kept in the dark, along with 19 others (at the last count and assuming they are all genuine tick ups which is very doubtful).

I do agree though that everybody should take responsibility for their own investment. Ultimately we all decide when to buy or sell and on what information to make those decisions - would just be nice though if there was more of it!

I don't think you should be so sanctimonious though about people complaining about a lack of information and in particular updates on previous claims and promises made when many would have invested on the basis of those same claims and promises. Everybody's patience has a limit, even yours, and with no encouraging updates, let alone actual evidence, of what they have claimed then it should be no surprise if more and more people moan about it or simply move on.

I'm staying (for now) as I think there will still be several decent spikes based on false rumours and hope but I've long since given up on any deals that will send the sp into orbit. If no such spikes come and I lose then that's on me. Equally if I bail and then a deal does come through then I have nothing else to blame for jumping ship too early than my own impatience and lack of belief.

"Auditors have to take the most prudent view regardless of management expectations its just nature of the job. Its not an exact science either, like I said auditors can be wrong they are just following the rule book to prepare financial statements."

You sound like you don't have much experience of auditing or being audited. Auditors do not prepare the financial statements at all - the company always do that (i.e. QBT in this case). They simply sign-off what the company write, possibly advising on or even 'insisting' at times if they feel something needs to be changed. They will not insist on the most prudent view being taken (particularly as that can be equally damaging to a company and its shareholders) - just a level of prudence they are comfortable with.

Yes, I was using the marathon example to simplify things but in any event the comment at the conference the analogy refers to doesn't relate to the auditors directly but to FG saying he is not saying they are not producing revenue this year. He could have simply said they are still expecting revenue this year rather than use a double negative. But he didn't.

Personally I expect no meaningful revenue in 2024 but to be clear that is just my opinion which of course could be completely wrong.

The NDA is irrelevant in this respect as it in no way affects the level of confidence revenue is referred to in the accounts or the confidence with which he can speak about revenues when asked - just as it wasn't relevant when he said he believed they were funded for revenue and that 2024 is the year for revenue. So the marathon analogy stands.

How could confidence about revenue (not promises) breach any confidentiality agreement?

To me he is sounding a lot less confident now but if you believe otherwise then fair enough but you clearly interpret the language used very differently to me.

No, auditors don't have to take the MOST prudent view, they just need to be reasonably prudent.

As to FG's statement if somebody told you they were going to run the London marathon next year and you asked them at Christmas if they were still on track to run it and they said, "Well, I'm not saying I'm not going to run it", would you still be as confident that they would take part?

"He posts positive and factual statements from publicly shared news."

Well, you got that half right. He's certainly positive. Factual? Not so much. In fact not much at all which is why I filtered him. He continually distorts the public information to suit his agenda and if he is now claiming FG's statement at the Miami conference means they are still on track for revenue this year then this is yet another distortion. There are clearly more doubts now from the way FG phrased his comment and in the exclusion of any revenue for the next twelve months (not just six) in the going concern statement.

To follow on from my previous post it means the interims will give an absolutely definitive answer as to whether they have benefitted from any mining in the last six months but in my view the recently published results already suggests they almost certainly haven't.

"The company has already announced that they have signed nda’s about the technology. Could this be why they haven’t announced anything about what they have mined or what they haven’t?"

No as I can't see how just stating any revenue from mining would break anything in an NDA as it doesn't disclose anything about who the partners may be or even how well or not the technology works (without further detail). Beside NDAs can't override what is reported in accounts or for other regulatory purposes. So if they are producing revenue the market ought to know about it - NDAs or not.