Member Info for james188

I view LGEN as a bond proxy with a better yield. The share price might well dip again, as it has in the past,but I think that the general trajectory is upwards. I thought that the Japanese deal was very smart and I would not be surprised if that relationship deepens.

SSIT secured shareholder approval for a programme of C share issues of up to £350 million in aggregate -not simply a one off raise. I asked about the sizing of this at the IMC presentation the other day and Mark Boggett responded that the first raise was likely to be well below the authorised total amount. He also said (repeated in the RNS this morning) that a number of opportunities had been lined up. I would be surprised if we have to wait long for further announcements in this regard.

Just to clarify. My concern is that there is nothing to stop all the C share proceeds being used to top up investments in the existing portfolio, rather than ring-fenced new and probably higher risk investments (which is what I had initially thought the funds would be used for). The C shares then convert into ordinary shares without paying the premium to NAV which purchasers of existing ordinary shares have to pay. Whilst the existing holders are not diluted on a NAV basis due to the conversion mechanics, the size of the C share issue could well depress the ordinary share price.

Excellent posts, Forensic 505. I also view the proposed C share issue as relatively cheap financing for SSIT, but I still have a number of questions as to how all this will work in practice, despite having crawled through all the available information (I also used to do this sort of thing for a living). In particular, I see that the C share proceeds will be ring fenced from the existing ordinary shares until those shares convert into ordinary shares, which will happen within 18 months of the Share allocation date, as I understand it. However, the C share proceeds can be invested in both new investments for the C share investors and also new/follow-on investments in the existing SSIT portfolio. How is that going to work in practice ,as it appears to be completely down to the discretion of Seraphim Space, as the AIFM? I have been unable to work that out from the information that has been made available to date.

If this was a VCT holding, there would be a defined allocation arrangement. There is also much less information as to the terms of the (critical) management agreement terms than I am used to seeing in other sectors - and the Registration Document summary is pithy, to put it politely. This is not to knock SSIT, which I think has done an excellent job to date. It is just that information on the mechanics is quite limited, in my view.

Nanosonics only play (successfully) in the field of ultrasound probes (and not the attached machine/cord). Germitech in particular is also in the mix. The TSTL offering is much wider than either of those and I believe that the cost is much cheaper. I am not aware of any HLD alternative to TSTL OPH, for example.

Even leaving aside the truly awful share buyback programme (what on earth were they thinking about?), I have severe reservations about the new business model. They are targeting volume sales to the public sector at low margins. This plan has ended badly multiple times in the past and I think that history will inevitably repeat itself. Think Carillion, Laing and lots of others. Why would anyone punt on this dreadful share when there are so many quality shares at bombed out prices? Not for me.

The results today were dreadful and disingenuous (specifically, ignoring hugely increased remediation liabilities to arrive at a delusional net operating profit, rather than a thumping loss). The CRST management team has been very poor and I do not trust the reported accounts - even now. CRST shareholders should be punching the air that anyone is prepared to to take this mess over at a material premium, even accepting that the CRST share price is on its knees - as is the BWY share price, for that matter.

This may be the most frustrating company that I have ever invested in. The core business looks decent, but there have been multiple management missteps/knee-jerk strategy changes over the last few years which have damaged the company hugely. Add to that the complete lack of stability at board level and sub-optimal corporate governance. Only one year ago, Mike Salter was stated to be a key part of management (having been sacked as CEO for good reason) and the company did not even bother to issue an RNS when he left, using the excuse that he had announced first on LinkedIn. Not nearly good enough.

The IMC presentation this afternoon as upbeat, but the credibility of management is on the line and we need to see results, rather than empty promises (of which there have been far too many). Shareholders are now being asked to back management to deliver growth and to accept a dividend pause. It had better deliver. I asked the final question on IMC as to whether the board had discussed strengthening the board by splitting the chair and CEO roles. I believe that it should. The response that this issue had not even come up in recent discussions really concerned me. As things stand, the company is uninvestable for me. I have reduced my exposure at a painful loss, but still hold. That is under review.

Completely unacceptable that the results were not out before the markrets opened.

I hold both BWY and RDW - as well as a couple of other house builders. I do not think that we have seen the bottom of the market yet. I have added to the above shares when dividends have kicked in, but most of my recent investment activity has been in VCTs. We will have to see what BWY have to say on Tuesday. Despite the very low prices, I am only adding very cautiously.

Muttley

Vlad,
I should first declare that I know Strictly and have met with him in person a few times, so I know that he is not a fictional poster.
I have followed with interest the debate about shareholder surplus. I focus more on total shareholder return. Stripping out intangibles has to be right, but your formula does not actually a concrete return, as the increase in NTAV may not be reflected in an increased share price. So, I can see that it is a sanity check, but I struggle to see the utility beyond that. I may be missing something.

Finally, you should consider joining the blog. I think that you would find it useful.

Just to add that I see that, following the recent virtual presentation , TSTL has now posted Q&A details on its website (Investor Centre - shareholder information - presentations) on its website. A must read for investors/potential investors in this stock. Note the responses to the BYOT collaboration and plans for the Cache range.

My understanding is that the BYOT related products (in the Cache range) will start to be introduced by TSTL bit by bit starting later this year. I agree that the TSTL price jump today seems to be mainly related to the BYOT RNS, but I find that slightly puzzling. BYOT are clearly doing well, but they are still a very small company and the success/actual financial impact of their product range for TSTL is nigh on impossible to predict. It is highly speculative, but with very little (if any) downside risk for TSTL. There are other much more predictable and comforting upside indicators to go on in evaluating TSTL, in my view. Start with the untapped or barely scratched expansion opportunities. It is not that long ago that TSTL shares were trading at over 500p.

I share your hope that further information on the BYOT deal and its progress is included in the presentation. We don't actually know if all regulatory approvals have been secured in the UK/EU for the Tristel8 range. Add to that the need to persuade the NHS and others to recommend using the products. Even in these unprecedented times, it could take a while longer.

Just a postscript on the CFO role. For all I know, Nic Hellyer is a highly competent individual. He may have been an excellent hire. However, I understand that he is a part time appointment. BYOT has had accounting problems in the past. In my view they need a full time CFO if they are to be considered as a serious investable proposition. As I said, I think that they need to upgrade.

stt1,
"I think that any potential is already in the price".
Well, personally, it is too soon for me to consider investing in BYOT, but there is obvious potential. I think that management deserve some credit for steps that they have taken to change the direction and business model for the company. For example, the initial deal that they signed with TSTL was well before anyone knew about COVID-19, so they were already thinking well ahead. The next few years will show whether BYOT can sign (and convert into profit) significant partnering agreements. Investing at this stage is basically a bet on the company's management, which I expect will need to be upgraded - e.g. appointing a decent CFO.

Just on the subject of the finncap 2021 revenue forecast of £10 million, I didn't consider that too awful. In contrast to many other brokers, I think that finncap tend to be more conservative on their projections. TSTL is a case in point, where they have constantly come in with forecast figures below those that the company has actually delivered. In any event, I don't think that this is about 2021, but the years beyond that. The company is undeniably in a sweet spot. The question is whether it can fully capitalise on the opportunity.

James

finncap (house broker) have issued a new note this morning, giving forecast figures for 2021 for the first time. Forecast revenue for FY 2021 is £10 million. Their target price remains at 9p. The note is available for free if you sign up on the finncap research website and can certify that you are a sophisticated investor or HNWI.

Each to their own as to what to make of the forecasts, but I think that the finncap broker notes for life sciences companies are generally worth a read and contain useful information beyond the actual figures. For example, there is an interesting section on valuation which discusses potential and references Tristel (TSTL) - a company I know much better than BYOT. BYOT is at a much earlier stage than TSTL in its evolution, but it is on my watchlist.

I wouldn't be surprised if we get a TU from TSTL much sooner than the end of July. We have not heard anything of significance (officially) from the company since the Byotrol announcement/brief comment on trading conditions back in March. A couple of local newspaper articles which the company retweeted indicate that it is experiencing high demand for its surface disinfectant products in particular (no surprise there), but it would be helpful to have a clearer idea of current trading conditions both in the UK and internationally.

I agree that there is a lot more to come, but I think that that applies whatever happens in the sort term with Covid19 issues. I can imagine that that might actually defer FDA approval, as the FDA must be swamped at the moment and the focus will be on a vaccine.

Putting that to one side, the fact is that hospitals etc will need to maintain higher levels of surface disinfection for all time. That aspect of TSTL's offering has been fairly low key so far (compared to medical instrument disinfection). And I hope/expect that TSTL will start to address the huge non-NHS market potential, probably in JV with a major partner. I think that we are still at a fairly early stage in the growth potential for this company.

From looking at share activity today, there was a fair amount of selling early on and very little activity (and at small amounts) after lunch. Other than people who exit through stop losses, I suspect that most holders are hanging on to what they have and so the market is drying up and the sp is being dragged down by small trades.