Member Info for marik

Who is TW?

"My point is Omega shouldn’t communicate price sensitive information to their shareholders via in advance to any other shareholder who then has the responsibility to inform the market - which by default would be the case in this instance"

Completely disagree with you. The company has already publicly announced (interims 30/09/21) information, which is within the norms of standard accounting practice (IAS 7.8). The PI's on this BB have calculated the burn rate which to me looks contrary to standard practice. I am in every right to confirm with the company that the standard practice was used.

I'm not just a genuine poster, I am also fully versed in the legalities. So CATEGORICALLY NO, this is not sensitive information, nothing relating to "big jock" and it has nothing to do with me or my statements. I hope that clarifies the situation for you.

"This mornings RNS, has to go down in history as the biggest attack on shareholder value..."

Let's wait and find out whether the burn rate calculated at £650k/month was correct.

"I saw the writing on the wall"

Hindsight doesn't help anyone. Neither does the I told you so story.

What would help is to understand where we get the £650k/month from. Which we've now ascertained is unlikely to be that high. Could well be 10x less.

@CaptainSwag. The cash and cash equivalents are available on p10 of the interims. The standard IAS practice it appears is that overdrafts in this case WOULD be included. I've asked for clarification on this only because the burn rate of £650k/month has been calculated by someone and widely disseminated. If incorrect, then it has caused some serious issues for private investors.

Once the components of the cash and cash equivalents (30/09/21) are confirmed, then calculating burn rate is possible. The balance at the bank takes wages and other cash outflow in to account. What may have been missed by some is the inflow of cash (e.g. revenue) and I've noted that it's missing from comments.

If it turns out the cash flow is not an issue and the burn rate is NOT £650k per month, then we have nothing to worry about with respect to paying the wages.

As I've stated before, I have not seen a convincing reason why the conventional IAS 7.8 use of bank overdrafts in cash and cash equivalents should be looked at differently for ODX.

GL

"We have had this problem with Omega before, we had a poster called ‘ big jock’ who Omega used to use / send sensitive information to without informing the wider market"

What are you getting at? Why are you drawing parallels between myself and "big jock"?

You are welcome tiger100, it seems that the PI's on this board and twitter may have overcalculated the burn rate (£650k/month). This may have (inadvertently) misled investors to sell and created unnecessary panic and decline in share price. As soon as I find out more from ODX, I will get back with further details.

@tiger100 the 25 Nov 2021 RNS [1] relates to "the six months ended 30 September 2021".

Oct+Nov+Dec+Jan(half) = 3.5 months.

1. https://www.lse.co.uk/rns/ODX/half-year-report-1cp7xzpw74gnzmk.html

@CaptainSwag

Thanks for the response. I have read IAS paragraph 8 (see link below). For certain overdrafts would be included in cash and cash equivalents (CaCE) and burn rate is therefore calculated as:

( CaCE(previous) - CaCE (current) ) / number of months

(£4.7m - £4.5m)/3.5months = £57k/montth

"was written in a deceitful way too"
I am not sure if I would conclude this, they've represented the figure as would be practice.

"they clearly got refused on the £8m overdraft they were seeking."
I am not aware of the overdraft they were seeking and what their current status is.

"the ceo salary is £16k a month so there is no way you are anywhere near with £57k a month"
The salaries etc can not be taken on their own to work out burn rate. You need to take into account the cash flowing in and cash out (and take into account the overdraft). We know the CaCE above and I've worked out the burn rate.

https://www.iasplus.com/en/standards/ias/ias7

@TradesIn and @Scharnhorst could either of you explain why the Deloitte and other firms consider it a part of the cash and cash equivalents?

As per my previous thread. I've contact ODX for clarification on the £4.7m cash and cash equivalents. Depending on whether the overdraft is included in that figure (which I believe it is based on IAS 7.8), the burn rate changes from £630k as some have suggested here to £57k. There is a substantial difference between the two as it would provide the company with 10-fold more time on their run way and reframes any fundraise.

I spoke to them on the phone and they will try and answer the questions I've sent and will get back soon via email.

GLA

@TWatcher do you disagree? If so, let me know why the overdraft is not included in the cash and cash equivalents (IAS7.8)?

I've just contacted ODX to find out whether this is the case, but would like someone from here to give any explanation they might have.

So we've all agreed that the burn rate is NOT £650k?

I would still like to get some feedback on the burn rate. If I'm going by IAS 7.8, the "cash and cash equivalents" line on the balance sheet indicates £4.7m and includes a component that is for a bank overdraft. The RNS from 19/01/2022 states that they have £4.5m remaining.

i.e. a burn rate of £0.2m over 3.5 months.

Very happy to be corrected, but I'm going by IAS 7.8.

This quote is from Deloitte regarding bank borrowings:

"They can only be included as a component of cash and cash equivalents if the banking arrangement is a bank overdraft that is repayable on demand and forms an integral part of the entity’s cash management."

@calamari £4.7m comes from the cash and cash equivalents on the balance sheet. For cash and cash equivalents, the bank overdrafts are included.

I've read the RNS, let's get to the bottom of this:

a) rns on 25/11/21 - cash is £4.7m
b) rns on 19/1/21 - cash in excess of £2.5m

In a) above the overdraft is included and in b) it's not. From those figures, someone has calculated the burn rate, is that correct?

The £4.7m includes the overdraft facility? No?

From the RNS today, we have statement: "Company has significant cash resources. Accordingly, there is no immediate need to raise additional capital"

So far I'm getting a burn rate of £57k per month (if someone could please verify) and a run way of 6.5 years. That would make the statement by the company valid.

Anything disputed doesn't play a part in the cash burn. The balance is based on cash in the bank (+ any facilities which can give equivalent cash). The numbers I would like to verify with the holders here are that the cash burn is ~£0.2m over 3.5 months. Is this correct?

Once verified that would be equivalent to £57k per month i.e. 6.5 year run way?