PYX Resources: Achieving volume and diversification milestones. Watch the video here.
My initial research suggests that this company will manufacture, deal with suppliers and customers, with the consequential requirement on working capital. No sign of the the gross margin on the product? Did they consider licensing it out?
If debts exceed cash balances, then the BOD will have to address that smartish. Investec sold, imo, a sufficient amount of their holding to generate funds for their share of the forthcoming placing (similar tactic by Lombard Odier at FUM). I doubt if they will raise more than £10 million. They will be lucky to get the placing a way at 10p but it may be as low as 7.5p. Two problems, will AMP subscribe, or will it forfeit its holding? It would be nice to see a small UK co get across the line with FDA. Like most on here, I thought approval was a formality.
@markthemango1
Hopefully, either a buyout or the funding from rights of the topical pain relief will see us over the line. On selling shares at a profit, one has to remember that LO lost a packet on their original holding. The average cost of their purchases up to 2016 was around 42p. In 2016 they subscribed to a placing at 57p. In 2018 they made disposals at 36p, 17p, and 8p! Why they disposed of 6 million shares in early November at around 8p I do not know. Beancounters may look at this differently, but in terms of cash, if LO were to sell their holding of 38 million shares today, they would be out of pocket. Now their exposure is below £10 million, and their holding is back to 18% odd of shares in issue, I expect the selling to abate. Also the newsflow for the next few weeks may be thin.
I have watched most of the presentation from yesterday. I note that this is unlikely to go commercial before 2021, so further financing will be necessary. About six months ago we were looking at sometime in 2020, so another year has gone by. Someone mentions LO selling shares at a profit. I have looked at all the RNS for LO since 2014, noted their sales and purchases and attempted to calculate an approximate selling price. The net carrying cost (purchases less net proceeds divided by number of shares they are holding) is currently around 26p. They are clearly selling at the moment but they are not making a profit. The decision to sell is driven by two things: provide liquidity to the market and reduce, probably for risk management purposes, their investment in FUM to less than £10 million.
The last time the price visited 45p, was it a week away from a major announcement? The price in this case is driven much more by today's situation rather than reference to market activity several months back.