Member Info for iWantThatOne

CC, I agree. NAV currently is about 0.175p per share and a doubling of VS’s valuation would see it reach c0.35p pre-consolidation, or c100p post, as you say. We have a year’s growth in VS to bring in on top of the current valuation, which would become transparent if and when it goes for a listing. Cash in the bank is adequate to keep the lights on, if not to make new investments. Definitely some value to be had.

I see Roman Abramovich is exploring a sale of Chelsea FC (Sunday Times). I wonder if he’ll also explore the sale of his other UK assets such as AFC? That might not be a bad thing, provided there’s a willing buyer at a good price, of course - the sale price would set a new level for the SP.

Just looking at what this mention in the Final Results might refer to. Atmospheric Water Generators capable of condensing water from air (water that might otherwise not fall as rain) appear to have been around for some time. Most look to be small scale and can be solar powered. I can’t see any that are currently capable of producing anything like one million liters of water per day - I guess that’s where AFC’s ability to generate serious amounts of off-grid electricity comes in. I haven’t tracked down any likely candidates for this European partner yet but it sounds like a wonderful project.

The Feb 2018 investor presentation states that $2.8bn is expected to be available for both the c$3bn debt repayment and dividends in the five years following full production (10Mt pa). That’s almost $600m pa available for dividends once debt has been repaid, i.e. approx 10-11c per share if ST2 is fully debt. That would suggest to me that 5p initial dividend wouldn’t be miles out. However I’d expect a higher SP than £1 due to expected ramp-up to 20Mt pa, very long life of mine and expectations of increased divis post debt repayment. Happy to be corrected if I’ve got any of that wrong.

Just seen a car with number plate AFC 1C - it’s a sign!

.....bear to catch up on the SP nowadays, I look at these board updates through my fingers. Is this company really only worth £25m or so? No! When something finally hits I think it will be meaningful, not least because it only takes a relatively modest amount of extra business to swing us into profitability. Which is why I’m holding - and continuing to peek through my fingers.....

Ha! What I actually said, Blacksheep, was that I think other shares can offer the prospect of 50p to 100p in two years (or the equivalent - c45%pa compound). With what I regard as similar risk profiles.

For me it’s a case of how SXX stacks up against other investment opportunities. If it looks like taking two years to get from 50p to £1.00, for example, as is likely, I won’t necessarily stay here. There are plenty of other decent investments out there. Similarly re divis - plenty of solid companies paying 5%pa.

Barnacles, my view is that extra capital will be needed early-ish Q4, to avoid running cash down to zero before a placing. Of course AFC will release good news as and when there is some. A Manufacturing deal etc will be helpful but I don’t believe, by itself, it will move the dial much. But they can’t magic good news out of the air if there isn’t any - and by that I mean, technical and process advances are good news indeed but I think it’s only “contract good news” that will have a significant SP effect. I’m confident that AFC will be a success so any placing will only have a temporary effect on the SP. As soon as a significant contract lands, we’re off. Hence my top-up. But I don’t think IIs and many PIs will think similarly - and it’s only buying activity that will shift the SP. So I do fear we may wallow for a while yet. Hope I’m wrong!

Interesting chat about fund raising here today. I’m of the view that this is the main issue that’s holding back the SP. IIs will be extremely cautious knowing that funds will be needed very soon, and having no idea how much or on what terms. Many PIs will also be worried about imminent dilution if they invest now. Nor do we know how AFC plans to structure itself to attack the various market segments in which it thinks it can operate. The new branding and marketing strategies that were mentioned recently have not yet been aired. There is so much still to be clarified here that AFC can still only be regarded as a “speculative play”, notwithstanding the excellent technical progress made. That’s good enough for me, and I topped up this morning. However I doubt we’ll see significant movement in the SP until the fund-raising is completed, whenever that is, and we have quite a few more building blocks in place - manufacturing, longevity etc. Having said that, of course I’d be delighted to be proved wrong, with a big contract being landed.

Reasons to be cheerful: Approx 18kg per month produced by Sino in what still sound like less than ideal conditions. Not the 25kg targeted per contractor but getting there. Also sounds like another contractor will be appointed very soon. Explorator costs covered. Now let’s hear more about the hard rock.

Caught up with the latest news last night -excellent progress. Surprised there weren’t more buys on the back of it - if seems only power generation purchase orders or their precursors will shift the price upwards meaningfully, like the 7m buys when the Oz arrangement was communicated. I think the likelihood of a fund raise in H2 is also keeping a lid on things. Very frustrating.

BB, yes but Southern need to be comfortable that AFC will not go bust by having to replace electrodes at a much faster rate than they have built into the contract. They will not just enter into a contract with AFC without some evidence they won’t be left with a BoP and a bankrupt stack supplier. They will have done due diligence on AFC and are presumably satisfied about longevity - based on...?

I remain uncertain about where the warranty is in all this. If companies like Southern are prepared to sign for an unwarranted product, with no guarantee that the AFC fuel cell can deliver electricity at the expected price, then why the need for a warranty at all? (apart from that may open up a larger market to AFC). Answer - I can only conclude that they aren't - the order may well be conditional upon such warranty. In that situation, AFC must be very confident to be proceeding, which either implies some form of c2 year warranty is close or else the development of 4 years longevity is going very well.

Well done AFC. Never in doubt! Even if a fund raising is imminent, we can be sure that the tech works and that further orders / contracts are surely coming. The start of a new fuel supply for coming decades......

Any day now, Southerhay. Testing must have been taking place for the requisite number of hours by now. That’ll unlock the floodgates...

First post of the day from me....good to see improved turnover and H2 EBITDA, as well as sufficient cash. The real story of course is the very strongly growing sales pipeline. US20m is about A$28m. Even if only 25% of those enquiries are converted, spread over two years, then that’s A$3.5m pa. On top of that would be license fees of, say, another A$1.8m (ie one licensee at £1m) and A$1m+ royalties. And I’m guessing that the 20m doesn’t include regular direct sales as opposed to new design wins. So the grand total is well over A$6m on a very conservative basis. So I’d say the financial position looks strong and underpins what could be very strong growth from that ever-growing pipeline. Still need to see those conversions but personally I’m confident.

* tumours!

Agree, given that we’ve been told the Chinese money has arrived and that the tech is on track for the end-August target (“able to treat superficial rumours”), I’m surprised we haven’t seen more buys recently. More detail is always welcome of course.

I take the words "Cumulative production to date is running ahead of Q1 (being the three months ended 31 March 2018), and significantly better than prior quarters with more than two weeks of potential production remaining" to mean that Sino are perhaps 10% up on Q1 already with 1/6th of the quarter (still to go). On that basis they'd be almost 30% up on Q1. The comment "significantly better than prior quarters" (relating to Q4, presumably) is a bit confusing as more gold was actually mined during that quarter, though less was sold. Anyway, a 30% improvement is not bad, especially as the wet weather went into the start of the quarter by some way, I think.