RE: Lack of good business judgement4 Sep 2024 08:55
Tgtd
“ Nanoco have no customers of any material value, a high monthly cash burn rate £7m a year and it takes years of research and development to launch a new qd product with high risk of delays.”
They say revenue will be roughly 75% of previously guided, so around £7.3m. That figure trumps your assessment of who their customer might be.
They aren’t saying they are going to launch a new product. They are going to address smaller scale, niche opportunities.
“Their track record to date based on comparing what's been delivered versus Board guidance is poor at best.”
Clearly, their customer withdrew without notice. That can happen with customers in any market. On the face of it, it was for reasons other than the joint project, but regardless of that, it was an unexpected and unpredictable event. That doesn’t bring NANO guidance into question.
“The fixed cost base is high and they recently entered a new factory lease at Runcorn because it was cheaper than their prior site in Manchester.”
What is the fixed cost base?
Fixed costs doesn’t mean permanent costs. Fixed costs are fixed until they are changed to new fixed costs. If management need to reduce fixed costs, or headcount, or whatever, then that’s their job. Nothing stays still in business.
“This isn't panicking this is being pragmatic about the company's financial viability and commercial future”
It was sarcasm. I understand that it’s faux panic. It’s just trolling.
“which appears very uncertain and limited with ageing IP patents, key staff reaching retirement and no foreseeable business prospects in the immediate future.”
Nothing is certain in business. IP patents are awarded, have a shelf life and are, by definition, ageing. That doesn’t preclude the creation of new IP patents and I guess that’s why they have a preponderance of employees with PhDs.
As for “foreseeable business prospects”, I accept 100% that you cannot see them, because you are 100% in the dark.
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