The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
The Iranian contract is quoted in Euros and we now know why. I doubt if WSG has any significant business with Saudi and as WSG have structured arrangements to be compliant even before the lifting the sanctions in 2015 then that bodes well. Besides, the initial 24m Euro multi year contract with subsequent phases for up to 60 airports compensates just a tad for any loss of the odd scanner sale or two to Saudi or Israel in the unlikely event that were to happen.
Humanbait, that's a particularly good point about companies with existing business and contracts being protected. Also, the main European trading countries with Iran - Germany, France and to a lesser extent the UK have such deep financial interests in maintaining existing trade with Iran and growing it. It's clear that WSG have initiated their German subsidiaries because some German investment banks are inclined to lend with little U.S. business. In that case they should be okay. Europe in general will be looking at other options as well :- Anyway, some links on the financing side :- https://financialtribune.com/articles/economy-business-and-markets/86191/china-to-be-major-beneficiary-of-us-iran-nuclear-deal Europe is weighing ways of putting its money where its mouth is by attempting to shield European companies from potential US punitive action. One possibility would be to use alternative Chinese financial networks. https://financialtribune.com/articles/economy-domestic-economy/86184/france-vows-pushback-against-us-sanctions-on-iran It�s time European countries opened their eyes, Le Maire said on Europe 1 radio. Europe needs new 'financial instruments allowing it to be independent from the United States' The other factor is that WSG services are exempt of sanctions and it would be perverse if the U.S. objected to airport security being upgraded by a British Company in a country they perceive as a threat. Logic should mean the U.S. should welcome that but Trump really doesn't do 'logic'. I'd envisage that argument would be made specifically for WSG by the leading UK politicians who have helped get this deal to the stage it is at. It's important for the Brexiteers like Boris Johnson and Liam Fox to justify their stance by delivering exactly the sort of deals outside the EU that WSG have done - albeit a deal / contract on hold at present. This should get sorted out in a way that allows WSG to proceed. The results statement will be interesting and I'd hope and expect WSG are anticipating more tech contracts like the recent 4.5 vehicle scanner deal and, even better, perhaps news on a managed services contract or two. The situation here for WSG is a financially stable company breaking into profitability on SL and other deals that just about justifies the market cap but with upside potential (with a signed contract) for 60 airports in Iran and recurring income managed services contracts elsewhere. A more than decent risk / reward in my view.
earthling, yes, my comment ( ' current business is blossoming') is mainly based on a substantial increase in flights / traffic in SL and, to a lesser extent, the 4.5m tech supply contract. I am hopeful for more of the latter and anticipate WSG moving into ebitda profitability this year and perhaps they are already there now on a month by month basis. I think eskers, gibbo and others have been less lazy than me and have done revenue estimates on the likely revenue upturn from SL alone. SL has very decent margins and that's the bonus trade off for going into these difficult locations. Nothing earth shattering but enough to give the current valuation a reasonable under-pinning with very little factored in for what amounts to a signed contract to provide security for Iran's main international airport plus 59 others in phases over time. I just think it's a highly compelling risk / reward at the current m/cap while we await Iranian developments - especially as my best guess is that the loan notes will be rolled over perhaps with a slightly cheaper conversion price. Anyway, not long to wait for more details on the 26th with an outside chance of other updates prior to that.
Good link. Too many vested big business interests so the European powers that be will be looking to protect firms that trade with Iran. Also there will be lobbying in the U.S. and especially for the Boeing's $20-billion deal to sell jets to Iran Air. It now becomes clear why WSG set up the German subsidiary because even when the U.S. was signed up to the nuclear agreement, British banks were unwilling to lend for trade deals with Iran. That's not the case with the German investment banks. Meanwhile whilst awaiting developments the existing business is increasingly under-pinned by the upturn in SL traffic and the likes of the 4.5m contract. I am hopeful there will be some more of these types fo contracts. With hindsight it's not clear it had to be a country like Iran because, realistically, 15m market cap WSG isn't going to get contracts aside from conflict and strife locations. The fact is though that the Company is sitting on a contract for an initial major airport with a potential phased roll out for 59 others. When the powers that be see sense and pave the way and the sign off is complete then the upside is phenomenal with very little factored in given the existing business is blossoming and to a certain extent under-pinning the valuation. Current Trump issues aside it is an excellent prospect to be doing business with over the long-term. It's not an Arabic country and not part of the Arab League, a population of 80m and a large % under the age of 30 and relatively westernised. Quite a lot of internal conflicts between the religious leaders and the predominantly secular population who are probably more westernise than any other part of the ME. Trump obviously thinks he can do a North Korea but that was mainly China's influence and he's too dim to realise Iran is very different. If loss of face can be saved on both sides then I can see a slightly revised agreement with Trump claiming it as the greatest agreement ever. It's mainly about his ego. I bet all other WSG holders, like me, wish Clinton had scraped through. Meanwhile the European and political lobbyists may well come up with something that protects businesses trading with Iran. I am confident WSG will have been aware that this scenario could arise and will have selected their supply chain accordingly but, regardless, they have to check thoroughly that all are on board. I've heard 'may take a week, may take a month' to assess but, given the strength of the existing business and the relatively low m/cap it looks an incrediblly good risk /reward. 60 airports that desperately need security upgrading says it all.
"Assuming success it would then be our intention then either to partner with a large pharmaceutical company to complete the pivotal trial (thereby earning a licence fee and generating milestone payments for the Group) or to explore the possibility of conducting the pivotal trial ourselves and, in doing so, assess the balance of increased capital risk versus the rewards relative to a company of our size." This will be NT's dilemma :- 'Assuming success it would then be our intention then either to partner with a large pharmaceutical company to complete the pivotal trial (thereby earning a licence fee and generating milestone payments for the Group) or to explore the possibility of conducting the pivotal trial ourselves and, in doing so, assess the balance of increased capital risk versus the rewards relative to a company of our size.' If N4P were just a one product company then I'd favour holding out for a bigger royalty for Sildenafil and go it alone, however, since Sildenafil isn't even the biggest market N4P prospect I'd love to see an early deal. That would set the Company up for accelerating the other generics development as well as Nuvec and set the Company up nicely. The shares would react very favourably I think. Unless he has changed his mind, however, NT favours going it alone if the backing is there.
Yes, fair point about the warrants and the initial costs of getting the other generics up and running are very low. I still wouldn't be averse to them raising say 2m at 20p or higher to accelerate things as long as it would be with sticky institutions. I am sure there would be demand as well and there really isn't any need for a company like N4p to use the Beaufort type of funders. It would be good to see all the warrants exercised. Only a proportion will sell stock to take up the warrants but, nonetheless, some will do and it can act as a slight brake on any uplift. Anyway, we'll get the definitive answer when Nigel and co. reveal the budget and strategy. I haven't checked the exact wording but I think it was synonymous with soon.
Hugh, that's not what NT says. I think the best way forward is they raise after what should be successful Sildenafil results at a higher price. They will not be able to fund Sildenafil through to commercialisation and the other generics with existing resources. Nigel has said as much very clearly solely about Sildenafil in the Nov presentation. They either go with a partner for 5% or so royalties or get 10% royalties if they fund themselves through clinical trials. He favoured the latter and said they would come back to shareholders post the initial trial if successful. N4P is remarkably low cash burn compared to other pharmas with lesser prospects and smaller markets but nonetheless they will need a bit for Sildenafil and the other generics.
Good solid results with low cash burn and the prospect of further collaborations for Nuvec flagged up. I am pleased that the other pipeline generic projects are going to be developed soon. It appears they intend to raise funds and, if so, they should be able to get a funding away at a decent price and around current levels. Alternatively, they could leave any funding until after the Sildenafil results which should be successful and give the share price a boost in addition to the option of an early licensing deal that would fund the other projects. Nigel's preference, however, is to license out after internally funded phase 3 completion for double digit royalties so I don't envisage an early licensing deal. If they could get a good upfront payment and say an 8% royalty deal after current Sildenafil trial results that would be my preference as it would fund the other products including Nuvec development without dilution. They have, however, used the word 'shortly' in terms of having the budget to develop the other products and Nuvec so I think an early Sildenafil licensing deal can be discounted. . They may well raise enough so they don't have to come back for the self funded Sildenafil development and I hope they opt for that. Getting the other products up and running spreads / reduces the investment risk and follows the low cost and low risk model that NT has established :- " In parallel, we hope shortly to have a plan and budget in place for our pipeline of other generic products which also seek to address potential multi-billion dollar markets whilst, as detailed above, setting out a programme for our vaccine work." I see this as a two year investment and find the low cost / low risk / multi product business model a rare and appealing prospect.
The link is Construction and projects in Nigeria: overview:- https://uk.practicallaw.thomsonreuters.com/8-574-5166?transitionType=Default&contextData=(sc.Default)&firstPage=true&bhcp=1
WSG have a solid base and possibly even ebitda profitable with next to nothing in the m/cap for one of the MOU's or the ME contract to be delivered. The relative solidity of the Company with current trading and the success WSG have made of SL through previous testing times should give them a a solid platform for contracts in other parts of Africa. As H&N says WSG do need to deliver one to get the credibility and market appetite for the stock. A smaller airport security contract would set the shares flying and then the ME contract could easily see 100p plus a share in my ramping , I mean humble opinion! Lots of opportunities in Nigeria with build, operate & transfer and this includes ports as well as airport projects. A lot of these are build, operate & transfer infrastructure projects but not all and with WSG having such an active local partner subsidiary then the Company looks to be in a good place to pick up contracts beyond the more basic security guard hire ones. Also, the extent of the projects highlights Nigeria's willingness and need to enter into innovative private / public funding partnerships. The recent 750m UKEF funding package for contracts for Nigeria highlights the potential opportunity here.
This one may already have been posted? https://www.justjobsng.com/2018/01/business-development-manager-at-westminster-security-solutions-nigeria-limited
Feeling positive with WSG despite the low volume share price drift. Decent tech contract & SL increased revenues are beginning to under-pin the existing m/cap which makes holding for the long awaited substantive uplift from the ME contract much more comfortable to wait for. WSG are recruiting in Nigeria and I see UKEF are providing export loan support in line with the British Govt & the Trade Envoy's efforts to develop close economic ties. https://guardian.ng/opinion/uks-increased-collaboration-with-nigerian-businesses/ 750m earmarked for Nigeria by UKEF in Feb this year. Also of interest in this context - especially as the recruitment number is plural :- https://www.justjobsng.com/2018/04/professional-security-guard-at-westminster-security-solutions-nigeria-limited For interested applicants, Westminster Security Solutions Nigeria Limited is recruiting professional security guards (male or female) with excellent customer service and security skills to join our tight-knit and highly regarded team. https://www.justjobsng.com/2018/01/accountant-at-westminster-security-solutions-nigeria-limited
I think we will have to agree to differ on this specific Hugh but agree that the outlook is exceptionally good. N4P are saying that the efficacy, nuclease protection and toxicology studies (whether it be for AZ or any other collaboration N4P establish) will be completed this year in their 'advance towards commercialisation'. They say much of this work will be completed this year. One of the attractions of N4P is that, despite their low budget, they can tap into the knowledge of ex AZ consultants who will know precisely what big pharma wants before they sign the lucrative commercial licenses. It looks like the feedback is that potential licensees want to see the results of the studies before signing high value deals. You obviously think licensing will come before these studies are completed. I tend to think big pharma is far more conservative than that and these tests have been put in place specifically to satisfy them based on direct feedback from potential licensees and the ex AZ people N4P link with. I wouldn't envisage that lucrative deals would be signed before results on toxicity, nuclease protection and efficacy. N4P are obviously doing these studies for their stated reason - namely to get Nuvec into a commercially ready state for lucrative licensing deals in 2019. Meanwhile this year I anticipate numerous collaboration / evaluation agreements.
Hugh, with respect I don't think you are reading my wording. Yes, as I have said a few times, invaluable collaborations this year but not commercial licenses until 2019. The former should pave the way for the latter in 2019 after much of the development programme has been completed this year. The timeframe for N4P to have Nuvec in commercially ready status is much less than most pharma products take whether it be drug or delivery system development. That commercially ready status in 2019 will give the potential for multiple high value licensing deals . On that basis N4P is in my view significantly under-valued. To be able to do this on such a low budget and a relatively quick timescale is impressive and adds to the low risk / high reward investment case. It's unproductive, however, trying to change the meaning of clear development timescales expressed only last month by the Company itself who give detailed specifics in terms of duration and the necessary works for the 'advance towards commercialisation'.
Hugh, yes they can do evaluations and collaborations as I anticipate this year but they can't commercialise until Nuvec is ready to be commercialised. The Company state that 'much of the work' necessary to 'advance towards commercialisation' will be completed 'by the end of 2018'. It's there in the rns announcement of 8th March. I am talking about commercial licenses with significant downpayments and milestones. I am happy to wait but I don't think it helps to raise expectations that conflict with the development stage timescales announced by the Company state. This what they will do this year prior to achieving commercially ready status for Nuvec :- 'Over the coming months, the Company proposes to carry out the following work on Nuvec(R): -- Demonstrate human primary cell transfection, crucial to understand the mechanism of action; -- Investigate the degree of nuclease protection achieved; -- Demonstrate pre-clincialefficacy; and -- Undertake a pre-clinical toxicology study to further understand the impact on the body of Nuvec(R) particles following subcutaneous administration.'
Hugh, I'd love that to be the case regarding Nuvec but I manage my own expectations based on precisely what N4P have put out via rns. It's somewhat different than your interpretation. They say Nuvec won't be commercially ready until the end of 2018 and, even then, there is the caveat of 'much of the work' so there will still be a bit more to do. That's good if N4P have started trials for Sildenafil. I think having announced they would commence the trial at the start of the year it's only fair to investors to announce a revised start date. Surely if they are starting later than their original projected date then the trial will finish later than envisaged? Investors can only get a handle on that if N4P communicate. It's not too material as N4P have had the useful cash from the warrants coming in but the onus is on N4P to put out accurate information or correct it if timeframes have slipped a bit. On Nuvec - if we look at the Company statement from early March it says : - 'the Company has embarked on an internal research programme to expand the dataset required in order to advance Nuvec(R) towards commercialisation... The Company expects to complete much of this work by the end of 2018. ' That suggests to me that we shouldn't raise expectations of commercial deals until 2019. I am confident though that more collaborations / evaluations will come this year and, looking at the advantages of using Nuvec, these should turn into commercial deals in 2019 when 'much of the work' required to 'advance Nuvec towards commercialisation' will, to use N4P's own words, be completed.
Thanks Forrestdreams, I see you are also in STAR which also looks promising. I notice the warrant exercises have dried up and that might be related to the Beaufort issue so any N4P rise with good news won't necessarily have the brakes that the warrants put on it previously. I would like to get a handle on when, realistically, Nuvec will be ready for a commercial deal and also a revised time for Sildenafil commencement and completion. The market will want to see some clarity on both before taking it up to the next level. As soon as N4P sign for Nuvec that is a commercial license with even a fairly modest initial downpayment then that's when the stock will take off. Stocks like NANO have been mentioned by Hugh before and they command a quite chunky M/cap (currently 108m) but only did so after commercial deals. I think N4P will follow suit post an initial commercial license. It's easy to lose sight of what a compelling reasonably low risk / very high reward stock this is but it will require patience from investors as things are not as Nigel relayed and hoped they would be in November last year. Things always take longer in pharma world than everyone anticipates.
I think N4P is a great medium term hold with multiple products potentially bringing one of those elusive ten baggers from here. Obviously Sildenafil and Nuvec are the most advanced. I will say, however, the Nov presentation was a bit out of kilter for both Sildenafil and Nuvec in terms of raising timescale expectations compared to the rns update. It was a great presentation in many ways but did put certain timeframes in the public domain that aren't accurate. I'm a bit disappointed by that. Hopefully we will get an announcement confirming Sildenafil trials have started. N4P said they were going to commence early in the new year with results in April. They hadn't commenced the human in the last rns so if results were going to be April with an early new year start then presumably they will be some way off if they haven't commenced yet. Perhaps they have started but the start hasn't been communicated. I think Nigel is a bit more savvy than that so I assume they haven't commenced. The November presentation also gave a timescale expectation for Nuvec's readiness for lucrative commercial deals rather than just collaborations. The Medimmune collaboration sets up N4P very nicely but the presentation indicated high value commercial deals at an earlier stage than I think is likely given the detail in the rns update. The last rns indicated there was quite a bit of development work still required for Nuvec whereas the Nov presentation made Nuvec look pretty much in a state of readiness for the multi million pound commercial licensing deals Nigel has hopes for in the future. We also haven't had the Nuvec differentiation study results that the Nov presentation suggested was being under-taken. There does seem to be a communication problem issue for Sildenafil commencement trial dates, Nuvec differentiation study results and timescales for commercial Nuvec deals as opposed to collaborative development deals. It's important to manage investor expectations and the last rns did that. I have reigned in my own timescale expectations as rns information will always take precedence over details put in a presentation. I still think, however, the medium-term outlook looks good and will reward shareholders.
Today 09:36NickE, re Gavin's options. He had 10,804,840 options at 0.7 pence pre adjustment so 10,804,840 �800�200=2,701,210 exercisable at 2.8p until the 14th October 2025 -------------------------- Hugh, thanks for that. A very generous option price. There is good liquidity in the shares but I'd imagine Gavin Burnell will be happy to see how things pan out and hold. Also, there will be small cap funds who wish to get in and should GB wish to sell in the future then there should be interested parties. One of the things that will appeal to funds aside from the positive outlook for the stock is the liquidity. Recently, for example, Miton Group exited Starcom and their holding was taken by Myles McNulty who also holds here of course.