Member Info for Nanonano

I watched the TH presentation, and to be honest although some of what they said made sense, a lot sounded to me like they wanted to solely focus on legal disputes which may not have netted anything of any worth and yet could have cost a lot of money. Samsung was the big fish, with them off the hook, most of the rest of the industry seems to be small beer.

I recall one of the chaps saying he'd work for free and wanted to make all the investors millionaires, but the detail was light on how he'd do it. None of them seemed to present any ideas on how they would make a better fist of growing the company organically, and most of it was along the lines of 'let's see the lay of the land once we get control of the reigns and then set a strategy.'

I think ultimately all these QD companies seem to get into difficulties. The QD market is still nascent, and I think it'll only really grow once the QD patents expire and it just becomes a cheap commodity.

I think the management have been sparing with information surrounding the partnerships, and their risk management has demonstrably fallen short with the way they distributed the £33m. I expect the latter which has been a major factor in BT collecting his P45.

"From £75m Samsung settlement balance"

$75m not £75m, plus withholding tax takes a few million off (although recoverable via other means), the hedge came to £58.8m, subtract your costs from that plus cash burn over the previous year and you get closer to the figure we're at.

Apologies 'incumbent'

I think the management panicked when challenged by Tariq Hamoodi, without the votes of Loam and co, they could have been out the door so they wanted to sweeten them up.

As it was the the tender offer was low enough to probably put the majority of retail investors underwater, but high enough to enable the II's to exit with a profit, and now we're here with very little II investment and the lowest value ever attributed the company.

Hamoodi's challenge was badly handled, and I'm not convinced his team would have turned things around, not that I'm delighted with the encumbent teams performance either.

this appalling risk management, without additional customers they should have held back another years cash at least to see them through the development period with the asian customer. they've played a **** or bust strategy with stmicro and investor cash.

i'm sure if nanoco had any other irons in the fire they'd have mentioned it by now. they have less than two years to turn this around, and that's not a long time when you consider what's been achieved post-settlement (19 months).

they have had materials ready for sale for over a decade, and they cannot find buyers.

the wits are quiet aren't they?

So in a nutshell without further significant business or a savage pruning of the workforce, they won't be able to sign-off accounts beyond FY26.

Wonder if BT will be presenting the end of year results in October and fielding the Q & A, or will he be leaving it to the Chairman?

I was concerned when we got no information on the products the dots were going into after the commercial order was filled. Brian gave an explanation of times for manufacture etc. that didn’t resonate with me, the dots are a late stage addition to the boards, so I believe STMicro would have been able to get stuff out of the door swiftly, plus they’d have been marketing samples well before that if they were seriously looking for applied use by OEM’s.

To suggest the board would have had no inkling of a lack of take up is naive thinking, they wanted to kick this as far down the road as they could before circumstances forced their hand.

They perhaps hoped something else would turn up in the meantime. Further mismanagement seems to be the cancellation of smaller contracts from last year of the other six or seven companies they said they were working with, unless the orders were so small they’d have resulted in no profit or a cost to the company.

Probably get an offer from Quantum Science Ltd.!

I would like to know more about why STMicro have ended the agreement.

Have they no further intention of pursuing SWIR based sensing, or have they chosen a different technical path or will they be going to a competitor for supply of materials?

All Nanoco have said is ‘ Nanoco understands that the European customer's decision has been based on its own strategic priorities and not as a result of concerns with the performance of Nanoco's materials..’ This mirrors what they said after Apple walked away in 2019

‘ The US Customer has now informed Nanoco that the project will not continue beyond the current contract, for reasons wholly unconnected to the performance of our materials and our service delivery.’

It doesn’t really tell us anything of value, as the performance of the materials may be within spec, but perhaps in the application chosen the spec isn’t adequate to impress OEM’s e.g. temperature tolerance and ageing may be a factor.

I think essentially this company has been a much higher risk investment than management would like investors to believe.

The NDA’s are a big red flag, generally when companies are very content that they will proceed with a technology they’re happy to discuss it, especially when they’ve already been displaying at conferences and trade shows- it’s hardly a secret by that stage.

It’s almost like there’s a desire by these big companies to just grind Nanoco into receivership,

TW the present share price has everything to do with lack of organic growth, and no visibility of future growth.

The whole strategy of the management team has been towards building a sustainable growing business and it’s in tatters.

Not just STMicro, but zero contracts in display and no other contracts in sensing either beyond an R&D contract with an unnamed Asian chemicals company, which could easily disappear.

They only have a few hundred thousand left now don’t they. Would keep the lights on for a couple of months at best, plus they made a written commitment to return those funds.

I think essentially investors are owed a full explanation of what has gone on between Nanoco and STMicro. I would also like to know why it took four years after the Apple contract cancellation to develop a product that was already well developed and close to production back in 2019. Would also be interested to know why it took another year or so for STMicro to give approval for production,

The CEO never talked about the chips the dots were going into, he always referred to devices the chips could be going into whilst also saying they didn’t know what device it would be. Turns it there was no market at all. Small wonder they were coy.

They need something more than that.

What feelers can our well-connected new(ish) non-exec's put out?

They need about £9-10m of business to cover company costs, which for context is more than double what they got from Samsung if you base it on a year by year amount. Answers on a postcard on how they're going to achieve that, going from past performance.

I think Nanoco is always going to be the jilted bride.

I think the tender offer may prove to be a miscalculation, and we should look to see where some of the extra funds have been soaked up.

Cash was not enough to service debt, and if the banks said no to more cash, what then?

Cash to when they expected to break even, of course all forward looking statements are open to risk, and with the loss of STMicro, they would be nowhere near breakeven.

The company have been treading water for a decade or so now. I think ultimately the business will have to be absorbed as part of a larger concern. I think there would be interest out there, question is at what price?

Think you should also consider the situation the company would have been in had it not received cash from the settlement.

How well do you think they would do on the market if they were still embroiled in legal proceedings, loan notes to be repaid and with no pending contracts?

"For some reason you are not interested in that part of the RNS that says negotiations with stm could lead lead to direct pursuit of many small customers."

Because LTH's have heard that kind of rhetoric before regarding display. Wah Hong and Merck were going to be supply to the OEM's, who all wanted Nanoco dots according to the last CEO. That went well then.

https://www.proactiveinvestors.com/companies/news/306198/nanoco-boss-all-the-big-tv-brands-want-our-technology-6198.html

Small customers (assuming they can even win them, didn't work in display) tend to mean small revenues, and Nanoco in its present form needs to drive sales of around £10m or more per annum in order to simply break even. So they will either have to greatly cut costs, or find something better or they're going to be winging it with the Asian customer.

"Commericialistion has since suffered an unexpected setback."

Commercialisation has been canceled for STMicro, that's a bit more than a setback. A setback would be something like a problem with one of the validation stages or a delay in the second order as per 2nd July RNS.

At the time I said I believed this would lead to cancelation, and the whole thing stank of play for time to allow the CEO to exit before there was a call for his head.

This time last year the company was proudly boasting of having eight or nine companies actively engaged in sensing products. As is often the case information they left out was far more important, out of the eight or nine, only two were of any significance, and seven were discretely dropped over the next few months.

Now we have just one POTENTIAL customer.

"On any objective analysis, it's undervalued."

On present cash agreed, but not by a huge margin, and the market will take into account the cash burn and what the company will be worth in six months to a year.

The value of the IP is unknown and there are no near-term commercial prospects, and even medium-term ones look extremely vague and uncertain.