Member Info for Occam

@1Pencil - thanks, that's a great chart. I'm in the stock for the long term, because I believe in the value proposition the products offer to farmers. In my experience in new agriculture products, they are always 2 (or 3) years later than hoped. Regulatory approvals, distribution contracts etc all take time, but then become huge barriers to entry for a company to defend against competition. My frustration is that I thought that the company was "asset light", and that the value was in the intellectual property. When product was contract-manufactured by a third party, huge profit margins would belong to shareholders (with a barrier to entry). I did not expect to see no profit at all, and cash flows now going into manufacturing technology. When am I ever going to see earnings, even if sales targets are met?

OAPK20: From what I understand of the minimum requirements for listing on NASDAQ (in terms of financial assets, liquidity etc.) Plant Healthcare might qualify to list there in a decade when they have achieved their long-term goals. In the short term, there is absolutely no point in spending thousands of pounds listing a UK company on minor US exchanges. It simply never trades there, for good reason. There isn't a single UK company listed on a US exchange (which isn't an ADR, which is a very different animal to listing the local share in USD).

I am disappointed that the sales of the product launches come, but there's no profit for the owners (shareholders). Being a bigger company, selling more, but not making any money is pointless. 2 years ago (when funding good ideas with free money) ended, the only companies any investors beyond VC were interested in were those who could make a profit. Love the products, but I don't understand the point if there is no profit.

@1Pencil - UK stocks simply cannot be traded on a US exchange. The flat fee for settlement of a foreign share is $50. That's not a huge amount, but it is 15% premium if you were to buy all the shares on offer. Also, 15% to sell, meaning the break-even (if the exchange rate stayed the same) is about 40%, before tax on gains! No surprise to me that no US investors can buy the US listed stock. The company have a great future, in my opinion, and are very cheap vs competitors in the same field (pun intended) on an EV to Sales Y5 basis. They would be better served either being a full US company (with US accounting in $), or being a pure UK company. trying to be half pregnant with a US listing is a drain on resources which brings no benefits (that I can see).

In the last press release, the management deferred their compensation to preserve capital and took options, to show their commitment to the company. I'm a bit cynical about taking options with an exercise price of 1p... I would sell my shares to have such a deep-in-the-money option to buy at 1p over the next 5 years! Skepticism aside on that front, I do not understand why the company has a listing in the USA. There is absolutely no benefit that I can see from paying tens of thousands of dollars to have a listing.

The benefits to the management of the company are that they can save money on the legal requirements and obligations of a public listing, and devote their attention and other resources to building the business. They have said it will take $100 mill in funding and 5 years to get proof of concept system running. The disadvantage of an individual holding a few shares is that there is no obligation by the management to say how things are going, and no market for the individual to find a buyer at a fair price. A shareholder becomes a private investor in the company. Everyone makes their own decision, but maybe selling now creates value for an individual to harvest the loss and reduce a gain taken on another position that worked out.

@1Pencil : Surely this is an IP company... how big is the fixed cost base? Salaries and operational real estate? I should probably do my homework a bit more to understand the elements of the fixed cost base, and try to do a rough calculation on what level of sales are needed for the gross margin to cover the fixed costs. R&D presumably is all expensed, and at some point it becomes a cash cow. I wish the management would focus more on targeting profitability than sales. In a free-money world, nobody cares about the cost of money to finance a business that at some point will become profitable, but those days are gone.

I'm frustrated that the business isn't making a profit. I understand the huge growth forecasts, but personally the current environment wants to see companies make money. The gross margin seems pretty stable: PHC give a contract to manufacture to another supplier, and then sell the finished product that cost 80c for $1. They should be making money regardless of the volume. There aren't economies of manufacturing scale, when it is outsourced (at least to a degree that a factory needs to make volume to cover fixed costs). PHC should be "asset light" owning the technology and the relationships to deliver to the market... so why isn't the company making money now? Why would increasing sales 2 or 3x suddenly change that?

@Aidan31 - If the buyer is satisfied with unaudited accounts, then there is no need for an audited version (which costs time and money to TNT). If the buyer was a listed company, then their shareholders could demand that as "due diligence". Stock exchanges usually have a rule that there cannot be selective disclosure of material information, but Tintra wasn't listed as a public company when the discussions of sale were entered into between the majority shareholder and the buyer. I don't know that any further RNS have to be made at all (ever). The company is privately held and not registered or listed, so is there an RNS requirement at all?

I think the links between Tintra Trust and Tintral PLC were huge, so guessing that Tintra Trust will transfer their shares in the PLC to the NewCo. In theory, the Trust is gathering cultural information which is critical data to use in the process of the PLC. I don't know the regulatory rules, but the offer of cash might be mandatory for small shareholders, but an option given to the trust and the majors.

@Aidan31. These are the facts. The unaudited (claimed) net assets of the company 8 months ago on 31st Jan were 1,147,000. The company spent 2,572,000 for the prior year in "admin costs" (presumably salary to management). Spending this year at the same rate would be 1,500,333 for the first 6 months. On July 5th the company said that the backer had pulled out, so they were paying back the 3 mill finance 500,000 in 3 days, then another 2,530,000 at the latest by Aug 4th. Obviously, the company have already spent that, and announced that there was a problem with the check they had written on Aug 10th (presumably it bounced) but an update would be issued "at the earliest opportunity". There is no update.

Aidan31, why would you post your plans to spend your profits? The stock was at a 52-week low when it was suspended. 52-week low means the stock price has never been lower, and the only reason the stock is not lower is that it can't go lower while suspended.

@SteJSteJ: I have no axe to grind. I hope everyone makes money in the stock market. When I looked at Tintra, it had more red flags that I have ever seen in a company (from a Governance side, as well as a start-up business). Those are honest red flags to me, but clearly not to everyone. That's a difference of approach, and that's what makes a market. I have made many good investments and many mistakes in decades of investing. For me, doing the work (that I could) led me not to invest in Tintra, but put my money in something else worked. I need facts, and numbers, not "magical conversations".

As a reminder, the business model is of a disruptive money transfer model, to be better, faster, and smarter at transferring money x-boarder. The current system processes millions of transactions a day. In my experience, the only delays I have ever had were when the sender didn't have the money to send, or had not instructed the money to be sent. If neither of those things happened, maybe the regulator stepped in and froze the account. Yeah, before you say it... "if the shares were trading they would be at 5 quid on this news..."

With all due respect, the conversion of a loan to equity is not always a given and a mark of company success. If an investor thinks a stock is going from 100 to 5, he will convert at 10p while that conversion has any value. At 5p, it's of no value at all to be able to convert at 10p. If he thinks the stock is going from 100 to 200, he keeps the right to buy at 10p which increases in value.

Yes, my math applies to the 99.99% of cases where a company issues stock at a discount to attract investors (buyers). You are totally right, that somebody could find a reason to pay 100x the market-offered price for a share. When companies are underwater from their funding value, the funding investors have a choice: they can either mark-to-market and take a 50% loss, OR then can ask for a trade at 100x the real value (but for a small amount) and say to "voila! the company is actually still worth much more than the stock price suggests!" I was told months ago that was one of the arguments in favor of buying - that I could buy a share for 150 and sell it for 1100 to some mysterious Gulf buyer. I would be delighted to sell you stock at 450. That's a huge discount to your forecast price of 500. You can double that by selling for 1100 or more. I have a rather different scenario in the real world!

@SteJSteJ The terms of the loan were known, the fact that the loan was converted was announced in the RNS. It increases the issued share count, reducing the value of the existing issued shares in before they were diluted.

Of course the company would like to issue shares higher than the share price. All companies would do that if they could, because it increases the value of the company. I can't think of a reason a rational investor would pay above market price, but I'm sure you can. Smorris doesn't appear to be a troll. When the investors came in and paid a massive premium to the market value for shares, it would have been great if the management had asked that investor if they could share their valuation approach. if they had, then probably many others would have accepted and the market price would have moved to that level.

@Dan55 With all due respect, I think you have this one upside down. If a company buys back existing shares, the value of the company is spread over fewer shares, and their quoted value would be higher. There might be a way for the number of shares outstanding to be reduced through a buy-back to 5 quid... but the company are out of cash. They are doing the opposite, issuing shares and that Reduces the price of existing shares. If this ever trades again, it is far more likely to trade at 5p than 5 quid. That's not opinion, that's math. The company has stated they wish to issue $100 million, which even at 10p wipes you out.

It means that the number of shares in issue has been increased by 8%, so the value of existing shares is 8% less. Tintra Foundation has increased it's shareholding by 8%, but paid TNT (the shareholders) 10p a share for doing it. They have also eliminated the repayment risk that there are no cash flows or balance sheet assets to cover the repayment of the loan. It does provide a lifeline to the management.

Can you sell delisted stocks? yes, in theory, but not on an exchange. TNT is still a publicly owned company. That did not change. I have no idea of the costs and most brokerages cannot execute an order to sell (it simply is not economic). Exchanges bring together buyers and sellers in a regulated marketplace. I assume the brokerage you hold with would call the company or Allenby, who would find a willing buyer and they would tell you what they were willing to pay. More importantly, the company still has access to the capital markets, if a buyer of size approaches them with a funding proposal.

Steemy - the only people who should buy before (any) suspension are those that are short the stock. Buy-to-Cover should come in before suspension to lock in the profit of a short position. It is much easier to close the short and lock in the profit than sit on a short position in a share that doesn't exist anymore.

@SteSteJ I don't think I made my point clearly. There is a tsunami of investors and $ who would fund Tintra to the tune of $50 mill in about a week - if it were not listed. I deal with "Impact Investment" which aims to invest in measurable social and environmental benefits - in business models that will produce a financial return in the future. Tintra absolutely fits that bill, except that it is listed. When an asset is listed and priced every trading day, it costs time and management attention and $, all of which are a distraction and a diversion of the most valuable assets. With problems now with auditors, Tintra has a self inflicted wound that will detract from the story and demand an explanation for the next few years. Delist, and fund privately. I don't think the company had the best advice when it was suggested that AIM listing was the best strategy.

The RNS does question if operating as a listed company on the AIM is the best way forward.

"The magical conversations that drive our business on a daily basis often feel at odds with the public company ..."

This isn't a traditional company run for the economic gain of shareholders. It is a noble cause for those who want to change the world.

"we see a key divergence of what we do, day to day, and difficult reactions to that on AIM."

"Our entire raison d'etre is to solve the challenges of inequality in the world. We will continue that work in whatever form we need to take as an organisation",

The primary goal of the company is global banking inclusion, which isn't necessarily at odds with shareholders demand to make money, but clearly the management are highlighting that they are questioning whether the company should be listed on AIM at all. I would suggest all this talk about a brief suspension (followed by a relisting at double the current price) seems fanciful.