Member Info for Mikemine

Thanks you guys. For some reason I always have trouble moving the decimal point and it's getting worse the older I get.

Larry was saying the costs of electricity from Mistral were going to be very competitive. Lets hope he's right. All good at the moment.

"have a levelised cost of energy of $0.06–7 per KWh." That's about 50p per MWh isn't it? Is that correct or have I got my decimal points mucked up?

This is how I see this week's trading so far and so i might be completely wrong as I don't see what the MMs see.

The recent robust trading numbers were mostly driven by a favourable tip in a newspaper. Following the tip investors wanted to buy at these low levels but they were quickly followed by day traders who added to the uplift. They were chasing a quick return and, when the rise in the SP faltered and stopped, they quickly bailed out to lock in their profits which led to a reversal. They are now largely out of the way and what we are seeing now is a combination of investors remembering the tip and the very positive RNS on the financials. Hopefully we will see a more gentle rise which will be more secure that a knee jerk reaction from a tip. That should keep the day traders uninterested for the most part as they want a quick turnover.

As you can see it is a personal views so you can make up your own minds as to what is happening and what may happen in the future. I don't put guesswork figures on where a SP might be at any point in the future as that's subject to many variable and they are much more likely to be wrong than right. The only thing I will say is that I can't see the SP remaining in the 40's very long now.

Not forgetting that the vanadium can be used again and again at the end of the life of the battery and that will have a value.

The story is in the DT and behind a paywall so I'll outline the gist of it

Last winter the Grid paid to have 3 locations of coal power stations on stand by but this year 2 out of the 3 will be closed permanently . They have 2.4GW of capacity and this will be missing next winter. That leaves perilously close to having little spare capacity and, if we have a cold winter, it could well lead to rationing and sudden blackouts. Without going in to the politics of the consequences of our Government's so called energy policy the need for large scale energy storage becomes abundantly clear. This must give IES a lift in investor awareness and makes Mistral ever more important.

Https://www.telegraph.co.uk/business/2023/06/28/britain-left-without-emergency-coal-reserves-winter/

You must have heard the Market saying "Buy on the rumour, sell on the news."

If you judge the content and what lies behind the raw numbers we get to a company that is about to deliver in a big way in the next 18 months. It's not just a question of selling more existing products, which it is ramping up nevertheless, it is about taking IES in to a different market with a superior product to anything that is there already. The pipeline has grown and will probably continue to do so, costs have declined and bottom line profit has increased.

If you leave aside the inevitable loss, which at this stage of development is a given, this is a cracking RNS. IES said 2023 would be a pivotal year and that is coming in as promised.

The forward looking statement should be interesting.

Thats a good point Maninshed and one I'd not considered. I don't have an answer but the insurance industry is waking up to the fact that when an EV gets in to an accident and the battery gets damaged it can lead often to the vehicle being written off whereas If the vehicle had an ICE it would have been repaired. The damage to the battery can be very minor for this to happen and insurance premiums are starting to reflect that risk. Stand alone batteries are different of course but the insurance companies are no doubt monitoring any increase in risks.

I'm not so sure DD77. At the moment lithium rules on many levels but there are problems, fire risk, degradation and the rising price now and in the future. It's big advantages are price and being the market leader. Mistral brings VFB's on par with price. After that their strengths come through. They don't degrade and need replacing in 10 years, there are no fire risk issues especially in 100 degrees of heat and, after 20 plus years, the vanadium can be used again or sold at the then market price. Even in Texas with the close ties with Tesla, I'll take you word on that, the logic of choosing Mistral will become hard to ignore IMHO

The article is incorrect "About 22% of the EU’s total energy consumption came from renewables in 2021, " They are confusing energy with electricity. It's a common mistake with reporters. Energy includes gas, coal and oil which of course is not electricity if it is used directly as a fuel.

Thank you for that BBN. Your posts contain little we didn't know but you put it together with the skill of an analyst. You saw the bid picture and where everything fitted. Much better than I could have done. Can't wait for your post after the finals are published. No pressure.

From a non accountant's view, it looks like contracts up to the turn of the year were loss leaders but now all the contracts bar one after the reporting year have a gross profit attached to them. From memory, we were told that a contract they expected and flagged in 2022 had been deferred and this would have had an affected revenue of course and, if this was another loss leader, I'm rather glad about that. I don't know how big that contract was.

As for cash burn, the RNS talks of costs reduction, so It may have improved, but IES is subject to general inflationary pressures like all of us. The cash position is further complicated by the LODES award and the costs of financing increased production to meet demand so who knows?

As to why they've chosen to announce this segment of news now one can only speculate but, apart from the regulatory obligation to announce material news that might affect valuation, it could be a ploy to boost the SP but I rather think that, because of the somewhat negative talk about loss margins (which the Market seems to have latched on to today) it could have spoilt a very positive finals presentation later. Focus should now be on the Forward Looking section of the finals which should include the pipeline.

Overall a mixed bag but at least IES is making a gross profit now and it looks like that will be the case continually in the future. As always the Market hasn't liked any mention of a loss, hence the drop IMHO.

Additionally I'd like to see some padding to the Mistral RNS especially how Gamesa fits in with the project. It looks like the pilot could be financed and constructed by IES on their own so what is Gamesa's input? I understand that Gamesa is still fully involved. Are they going to be the leader in the next pilot? The SP certainly needs a boost and the Market realising that Siemens is absolutely there could be the push the SP needs..More information please Larry

I've never had a satisfactory explanation as to why people would buy shares in single numbers. There were even 2 single share trades today. Anybody have a definitive explanation?

Thanks for that Risky. It does look like Mistral has been taking longer than we first thought but the first pilot has been announced and, from what Larry said, there will be multiple pilots so more announcements coming up this year probably. The pilots are essential and were used for VS3 before Mistral. Everybody knows that pilots will be subject to tweaking and maybe refining and that's not what you want in a commercial product. Customers would not be happy with that.

By the way, I've communicated with IES over the lack of mention of Gamesa in the Mistral RNS and they said that Gamesa is still fully involved with the project and are still fully committed to Mistral which is reassuring.

Despite the perceived delay, when the commercial rollout begins next year we will have forgotten about it and be debating how many MWs IES will be selling in 2024.

There's a lot to this RNS. Firstly a pilot, or prototype derivative if you like, is never the same as the commercial product. It was never going to be 40MW because that scale is not needed as long as the pilot is capable of being scaled up without too much mutation. The point of a pilot is to iron out the blips and demonstrate capability. It obviously works well in the factory or it would never reach pilot stage.

The timescale surprised and somewhat disappointed me. I took the original 2 year project to mean Mistral would get to the pilot stage around this time, not in almost a year's time. It's no wonder the Market has shown scant enthusiasm. Having said that, the project has not collapsed, as it could have done, and IES has secured some additional funding along the way. I'm not sure IES needs any more pilots so news on Mistral will be scant for quite a while I reckon.Anyway, project ourselves forward a year and IES will probably be announcing large orders and have a facility to fulfil them. It will also have a world class unique product that can fulfil a growing huge need. Whats not to like about that?

It was interesting that Seimens wasn't mentioned. It looks like IES are going to produce this pilot themselves so where is their partner in all this? 200MW sounds a lot but to a company like Seimans it's small beer. We can expect more news on that front this year.

So overall the RNS was positive but well flagged. It reenforces the fact that IES is on its' way to a big future. We can now look forward to all the other orders that should be announced in the coming weeks and months according to Larry. The SP will follow.

Looks like IES are really and at long last on their way. Larry didn't dispute, I think he actually agreed with it, the revenue projections of doubling every year from now on coming from Canaccord. Pilot project coming this year as already been noted and an increase in the pipeline. All positive stuff. Add all that to the recent LODES contract of £11 mn and the company's position looks pretty healthy. The only thing missing is the SP which is ridiculously low considering the aforementioned. That will correct in time, sometime this year is my guess.

Judging by the Market's reaction to the last 2 sales, it seems that little will move the SP until IES hits profitability or Mistral is up and running.

As far as I understand it, and I think Larry said it once, Mistral is not using any new and untested technology. The flow battery is essential using IES's know how and existing technology. What has taken the time is creating a new and much bigger box for the technology and changing the hardware generally.

I've no idea how big IES's part is in all this nor what percentage of profit they are getting. No doubt we will be told more in due course but, as to timescale, Harper said last September from memory that the project should roll out in a bout a year so that's 4-5 months time. As in all these projects, its difficult to be precise about timing as there are always surprises, good and bad, so I'm looking towards the end of the summer with at least one update before that maybe.

If it all comes good, and I can't see why not, then it places IES on a different level IMHO. There is a big demand for grid scale battery installations and, with a competitive price already flagged, I don't why Mistral will not be a success.