Member Info for iWantThatOne

What a day! I’d be surprised if a meaningful RNS will be out tomorrow, given the Chairman’s purchase the other day. Probably just sheer weight of buying. You never know though - Dunsfold or Southern could have made a decision in the last day or two.

Estimated 1.5m subscribers end-Q2 2019, from a quick google (Youtube don’t release numbers themselves). Sounds significantly smaller than Spotify (and indeed Disney) but growing and very welcome. These subscriptions really seem to be coming along thick and fast now. I’d like more info from the company on what proportion of revenue comes from them.

Well I hope Schroders and Mr Rennocks know what they’re doing, after Bmac returned to this board after ten years, like a prophet from the wilderness, to give us his expert opinion......

An extra 2m shares for Schroders, if my calcs are correct.

Bimini, which easy milestones are they missing by “months”? One of the components has been delivered two weeks late but that’s all, I think. The targets for the next few quarters haven’t been clarified, to my knowledge, other than an implied “get it working as a complete system” in advance of first patient treatment by the end of 2020.

Agree, they seem to be incredibly complacent about the LOM extension, with not even an update or a revised target date. Against that background, the exercise of some 1p options at an immediate profit of almost £100k is galling. Four people including me have made this point on the Twitter feed - join in if you feel strongly enough!

Also it doesn’t take too much imagination to project £25m sales pa which, at 20% margin (which AB has mentioned before), would see the company reach break even. But I’m getting ahead of myself here.

Yes I noticed that too, Lucky. They must be very close to needing cash but you never know, an up-front license fee might just arrive in the nick of time. I noted also that Alkamem is “capital-lite”, so early sales and production could be achieved without the need for significant cash.

All we need now is an RNS telling us that John Rennocks has bought some shares. Stranger things have happened.

Great RNS - Potentially a better product than one that sells $1bn pa! And the validation from de Nora is enormously valuable. Sounds like commercial discussions are already underway, including - I would think - de Nora themselves. Great start to the week.

I don’t know about share price Athansius but if the technology is as good as it sounds then why shouldn’t AFC be as successful as the loss-making Ballard’s etc? (That didn’t come out quite right - I didn’t mean equally loss-making). 2020 could be very exciting if they can commercialize CH2ARGE and Alkamem, prototype the high-density cell and sell a few large stationary solutions. Not forgetting diesel genset replacement.

Some more thoughts on valuation: instead of looking at PE-type ratios, I understand that Mcap/Forward Revenues is a more common valuation methodology for SaaS businesses like GAN. The current ratio (based on 158p, £22m revenue estimated for 2019) is 6.1. From a bit of googling, I see that the median ratios for recent US SaaS sales are between 7.5 and 10, having gone up well in 2019. Of course GAN’s forward revenues for 2020 will be significantly higher, and revenue growth is an important factor in the valuations. So I’d say this further supports the notion that GAN can go a lot higher, albeit I’m sure there are plenty of reasons why the above method and ratio won’t be entirely, or even approximately, appropriate. One final thought - I wonder if the recent trading update RNS was designed deliberately to put more price-sensitive information into the public domain to bolster bids from interested parties? (Remembering that they don’t have access to non-public info under stock exchange rules).

Gambling.com has a good summary report from three days ago on the current state of US Sports betting (I haven't shared the link but it's easy to find). It says that "In the 18 months since states could start taking legal sports bets, 19 states (plus D.C.) have either accepted bets or legalized the ability to do so. Up to a dozen more could follow suit in 2020. .......Since only Virginia and Michigan have seriously considered online casino or poker gaming, sports betting remains the key driver of gaming action nationwide [in 2020]" And when you consider that many of the current 19 haven't yet accepted bets and are still working through the issues, the scope for GAN looks very significant indeed.

Me too. Looking forward to it.

Don't agree with this. Recent license agreements (TDK, CDE) are also on 5% royalty terms, which Kongats could have increased if he thought the rate was too low. Moreover, royalty fee/margin is only half the equation, the other being sales volume. CPX couldn't hope to have the sales reach that these licensees have, so much of the loyalty revenue is income CPX would never see even if they manufactured directly. Interesting to see Kongats reinforce the Board's belief in the current licensing strategy. Current royalties are low but Prizmacap, TDK, CDE, Ioxus and hopefully Maxwell / new 3V licensee will boost the figure meaningfully in this financial year. Overall I was encouraged with the results - Prizmacap just launched, 3V to start shipping by year-end, and then this intriguing statement that Surprised highlighted - "The Company is in advanced discussions to enhance further its supercapacitor offering and has undertaken a substantial amount of work in this regard. Whilst this process has not been concluded, the Board is hopeful of a positive outcome and the Company will provide a further update when appropriate...."

Daz, why would they do that? If they’re selling, let the price rise and they’ll make more money. It’s only make sense if they’re expecting to be involved in the next fund raise (which could be possible). In any event, we’ve simply got to get away from this situation of having funding partners who trade shares or sell in advance. We need a sizeable investment from a strategic partner who’ll hold the shares for years. Over to you, de Nora.

Excellent work from the AFC boffins. This looks a real game-changer. What potential! I’d be interested to know how the high-density fuel cell compares with the (L) version in terms of cost - presumably more expensive to produce / maintain or else it could supplant it, given its space advantages. Anyway, we can all see now why the website has been delayed, given the firming up of products, names and applications. Agree with others that the poor state of the balance sheet is holding back the SP.

So how do the fundamentals look, at this lovely share price? At 144p the EV is about £115m, having knocked a bit off for cash held. If their own "Clean EBITDA" this year is £5m (which doesn't seem unreasonable - £3.0m in H1) then EV/EBITDA is 23. Seems a bit racy, but if EBITDA next year is £10m, then the ratio becomes just 11.5. And again that EBITDA doesn't seem unreasonable if you consider a full year for PA and Indiana, plus the casinos recently gone live, plus new states that go online with FanDuel, possibly more patent fees etc. etc. And a US listing may well see higher multiples than 11.5. These figures are all speculative but I can comfortably rationalise the current share price on a forward basis. Any other thoughts?

And their EBITDA number for H1 was £3.0m, so cash profits being made. In H2, with revenue approaching that of H1, per the RNS, then another £2m+ seems quite possible.

HydroX-Cell(S)TM - .......capable of deployment across a range of both stationary and MOBILE applications....”. Just sayin’.