Member Info for iWantThatOne

Agree delivery is rubbish but I thought the business model was clear? Fuel cell used as the base for multiple products from Chlor-alkali to diesel replacement - anything off-grid. ESCO model preferred for mainstream electricity production. Three routes to market inc direct sales. Outsource electrode and fuel cell manufacture and containers. Develop reference sites for the multiple uses. As I write this I realize none has been delivered but it could (could!) be announced tomorrow. Please God. And yes, I also dream about 10p, which would value AFC at a huge £40m.

I wonder if RA has provided a loan to see the company through a few more months? After all, the difference between a placing at 5p and say 10p (on the back of some news at last) is huge. In terms of comms, why oh why can’t the BOD reverse this stupid decision about not communicating MoUs, or otherwise give some indication of how many scoping studies are underway? We pretty much have a false market now where no investor has the information required to inform either a buy or a sell.

JL, I take issue with your description of BGO as a “story” stock. It has excellent products in an established market and deep relationships with multiple market participants. I think the market wasn’t really there in a sufficient size for BGO to thrive until now but I agree, all the elements are there for significant growth from now on. In terms of valuation, it’s one of those stocks where - with a mostly fixed cost base - there is high gearing, and growth quickly translates into profits - hence the SP of higher than 200p as investors could see how this would (will) play out. I admit I went too early and invested at those prices but have been able to average down since.

From Sunday Times today: “An investment fund that financed the building of Britain’s first proton beam therapy centres for cancer treatment is gearing up for a £320m float......planning to raise £50m on the NEX Exhange.....the company was valued at £165m when it raised £25m from investors last year.....Proton Partners operates proton beam centres in Newport, South Wales, Reading and Bomarsund....Each centre costs about £25m. A fourth will open in Liverpool next year.”

It’s true that we need revenue now and can’t wait, we’re all impatient - but we shouldn’t forget that the hydrogen economy is in its absolute infancy. I think we’re at the start of a shift that will take decades, and if AFC gets this right it could be one of the winners - and that would see it become a massive company. But let’s just get through this first phase!

So JOI is the US hydrogen company with which AFC tested its fuel cell in the autumn? Sounds likely. And continuing joint seminars sounds promising. Potential for licensing the H2 technology from them, or working together to present a combined solution.

I was just re-reading the Interims from last July to try and cheer myself up. Two things I’d like to hear about now are: “We are starting to see growing interest for AFC Energy's fuel cell technology in Australia and through existing networks and relationships have commenced dialogue across each state to scope possible fuel cell system deployment opportunities.” “Work to commence during the remainder of 2018 on the integration of De Nora technologies (outside of electrodes) with AFC Energy fuel cell technology package to create new market-led solutions with sizeable addressable markets.” So that’s 6 scoping exercises in Oz at least, and possible water treatment (?) solutions with De Nora that have been mooted here. But jeez, come on AFC, we’re dying here. And the cash runs out (looks at watch) round about.......now.

Gosh. Munters, thanks for the seminar. I really do think you’re some kind of guru. Who cares what happened in the year 2000 when smartphones were a twinkle in Steve Jobs’ eye? This “20 years without a profit” is meaningless - it sounds like they had a solution to a problem that didn’t exist at the time, rather than the company being useless. It’s 2019 and beyond that I’m interested in. I’ll happily make you a bet that there’ll be positive post-tax profits this year. Are we on?

Come on now Munters, use YOUR head. They have sufficient cash to see them through, as has been said many times and as the annual report in March will indicate. You can’t ignore the inexorable logic of the maths, as set out by T&C below - EUS growing at its current rate, with other things such as margin and costs in line with recent, will see the company post positive post-tax profits in 2019. I can understand some people will want to see the evidence first, but they will miss the largest gains as the sp is likely to re-rate very quickly once the effect of the growth rates is understood - IMHO.

Does anyone think Brexit may be at the heart of delays in expected announcements? If Italy, Australia and other countries aren’t yet clear on what rules may apply to doing business with AFC post 29/3 - tariffs, regulatory issues etc - then partners can’t proceed with confidence. I know we’re not talking about retail business here but certain rules must still apply to AFC’s technology. Mind you, I’d have expected the company to have said something by now if this was a big stumbling block.

Still all to play for in Korea if the government is calling for a further 1200MW from stationary fuel cells in the next three years....

The Frost and Sullivan article says “As ammonia is cheaper than diesel in all but a few countries, GenCell's A5 off-grid solution for the underserved rural segment is available at running costs of $0.50 kilowatt hour (kWh) to $0.75 kWh, which is two to three times lower than the running costs of diesel generators.“. Surely AFC can beat that already, if it has s roadmap to less than 10c per kWh plus the cost of hydrogen or ammonia? For Pete’s sake, AFC, get on with it!

However only the directors and very senior managers can directly affect share price by their actions, whereas more junior employees could perform well but not see the fruits of their labours if the share price stagnates, You should only be incentivized for what you can directly affect. Hence share price wouldn’t by s good KPI to include in an incentive plan for most employees. Directors should have a separate incentive plan.

The suggestion that partners and investors are apparently interested - that surely is a positive (if it is to be believed)?

What were people expecting? Alluvial results are not going to significantly help the recovery and never were. The hints on the hard rock are interesting, “investors and partners”. That’ll be the key.

It’s a tough one - announce when the design of C2HARGE is done or wait for a partner? Personally I’m glad they announced it as it shows real progress (and I do think it’s genuine progress). It does sound like licensing opportunities are being worked on. And from other companies I follow, i know how long that can take. With respect to the fund raising I think they’ve got something up their sleeves other than a placing, as they’re running on fumes and would normally have announced something by now. My best guess? An imminent deal or strategic partnership that involves an upfront payment to AFC, with manufacturing and electrode deals announced concurrently.

Agreed Rivaldo. If the company achieves a 75% increase in revenues (mid-point of guidance) then that’s an additional £8m or so. Not only will that give positive EBITDA, there’s a chance it’ll lead to positive post-tax profits - mainly dependent on cost increases of course. FY 2018 accounts won’t look much different from 2017, but 2019 onwards looks great.

The strategy work (supplemented by approaches from various companies) done in the last 12m clearly has changed the company’s view of its core offering. It seems that the basic fuel cell is now the core product rather than Kore. This fuel cell can be formed into different “packages” to meet different market needs. It looks like some view this as deviating unreasonably from the company’s original target market. I see it as a smart move that allows AFC to play in multiple markets and make the most of its IP. What product will be next?

If the Q4 KPIs are replicated throughout 2019 with just modest growth then we’ll be looking at gross revenues up 100%. And that’s just with NJ on board for sports betting! Hope to see management comment on how the DoJ’s opinion on the Wire Act will affect the business, if at all.

Yes, based on PE ratios and divi yield, this seems a very strong buy to me. The unknown is growth potential from here, especially considering share buy backs are being employed instead of (some) acquisitions. But even with slower growth than previously anticipated, the fundamentals seem strong.