Member Info for Pip56

Well I think this is the week when we should get some transparency on what has been happening. Although the FCRM website gives nothing away my interpretation of past RNS releases indicates the EOY is on 31 March.

On Wednesday morning we can expect a trading statement and a corresponding sp movement depending on the content. It's difficult to call either way. The BoD made purchases before the time bar, suggesting positive news, however the sp has been stuck in the doldrums suggesting there have been no leaks and no appetite for speculation. Goodness knows what gems will be revealed...

70p? Where did that number come from...

In July 2018 the SP hit 75p and it then progressively fell to 22p by Jun 19. Since then it has meandered through the 20's, spiked at 42p (Nov 20) and stagnated in the mid 30's. The company stopped the dividend and is growing a deficit. I don't see 70p anytime soon but happy to be persuaded otherwise...

Since December 2019 the whole show has gone pear shaped with a complete trashing of the original BoD.

Cheers Jl. TBH I am on the cusp of bailing out and taking the loss on the chin. I originally bought for the dividend and opportunity for growth in the long term on the understanding FCRM was an infrastructure company like National Grid. I hung on after the divi was chopped believing it was a blip. Having come this far I will look to the 1 Apr update and see what is on the cards.

The end of year trading update is due on 1 Apr. In 2019 it was used to declare a smart meter contract and in 2020 came the news of the domestic asset sale - followed in short order by a hostile bid whilst the SP was in its boots.

Recent BoD buys suggest the 2021 update will be bringing good news, perhaps a post Covid recovery and further movement into charging stations. However Harwood and Bayford may also be keen to make their move after a frustrating year when the SP has been in comparatively cheap territory. Positive news in 3 weeks time and a rising SP might just force their hand into action.

This uncertainty of what is to come has been manufactured by the company's complete information void. Looking back all we have had are directorate changes/buys and EV infrastructure developments.

Ah... just posted now. Bayford up to 15.46%. I have also looked at the AIM Rules and I think the point for making a mandatory offer is 30%. I can't find anything about the consequences of breaching a Relationship Agreement.

This from the 05 Jun RNS:
"Neither Harwood nor Bayford will be permitted to make a general offer for the Company's shares unless the offer is recommended by the independent directors and neither must take any action which would trigger an obligation to make a mandatory offer"
and
"Harwood's Relationship Agreement will apply only for as long as it is interested in shares in the Company carrying not less than 10 per cent of the Company's total voting rights, applying the definition of interests in securities in the Code. Bayford's Relationship Agreement will also apply for as long as it is interested in shares in the Company carrying not less than 10 per cent of the Company's total voting rights, again applying the definition of interests in securities in the Code, although this threshold will increase to 20 per cent should the Harwood Relationship Agreement cease to apply"

So at the moment Harwood and Bayford are effectively cancelling each other out. Both have seats on the board and both are tied into a relationship agreement preventing an open bid without the agreement of the independent directors.

What I do not understand are the legal consequences of breaking the agreement which has been adopted into the Articles of Association. Bayford is continuing to accumulate shares - buying on the open market and via Turner (and his wife) who recently transferred their own FCRM shares into Bayford. On 20 Dec 20 Bayford held 14.4% of FCRM equity, but that figure is significantly out of date now and must be 15+%.

At what point would a mandatory offer need to be made and what happens if such an action breaks the Agreement as stated above?

I am similarly holding to see how this develops. I have gone back and read through all the reports for the last 4 years to try and understand where this went off the rails. The critical period was when the EOY report was delayed 5 months under the smokescreen of changed accounting rules. Prior to that the business was steaming along quite nicely.

The key takeaway for me was the steady stream of contracts; the adoption of electricity connection networks to provide an income and the sale of the gas connections to similarly provide a steady income. My conclusion was that there is a steady flow of money coming in, despite the recent £2.5m loss. It's an odd trading year so let's see what comes in the final report.

If there is a serious deficit it is in the lack of news flow. The company is hardly standing up and advertising itself as a 'go to' business in what I presume is a competitive environment. I find this disconcerting because it feeds the conspiracy theories.

Yes they are token buys. That they all happened in such close proximity suggests they were agreed during a board meeting. However a £10,000 spend into the company by the Chairman & CEO is hardly a glowing endorsement or a definitive commitment. I note Turner is sitting on 32.7 million shares but he has an ulterior motive.

Well done on your 30% JL. I am looking at this the other way around being down 30%. I enjoyed a years dividends before they took the wheels off, leaving me high and dry. I am going to hang on a little longer and see whether this can turn around with the domestic asset sales generating regular income.

I agree the key elements of the BoD are stool pigeons suggesting the full vacillations of the last 12 months are yet to fully play out:
Option 1 - Carry on as now - the two factions see the benefits of a combined effort for as long as it serves their interests.
Option 2 - Break up the elements - the two factions go to war and they pull it apart.
Option 3 - Take the whole thing private - one party wins and pulls it into their own orbit.

As a shareholder its seriously frustrating to see the sp languishing. I will look to the next trade update to see if there is any light at the end of the tunnel.

Ji5 - You are reading my post in a literal sense. I just used 'pipes' as an example! I am not actually aware of such a tie up and yes, you are right, pipes are part of their core business and so it was a poor example to use. Perhaps a better analogy is to say that agreeing to partner with Jumptech (a software firm) is like agreeing to only use only Apple products throughout the business.

Jumptech have benefited from getting a company to use their product and Fulcrum are benefiting from using and installing software that is becoming ubiquitous through the industry. The problem is that there will be many companies developing software for the Green Revolution and who is to know which will be the dominant system?

I have looked at this a little more closely. The overall beneficiary seems to be Jumptech. Their website is a low cost effort with no direct explanation about what they do. My conclusion, from reading other Jumptech news items, is that they have developed some sort of software. What it exactly does is a mystery as it not properly explained anywhere.

Jumptech looks like a tech startup. I suggest Fulcrum only released this news because Jumptech were going to release their own news item anyway as a means of demonstrating their credentials. I do not see a direct financial benefit to Fulcrum. I put this in the same bracket as Fulcrum declaring they are going into partnership with one plastic pipe company - good for the pipe company but irrelevant to Fulcrum.

I also invest in Biffa (the waste collection business). In the last 72 hours they have released two news items covering the winning and extension of multimillion pound contracts. As a shareholder it is the sort of news that gives me that warm fuzzy feeling they are active looking for work and keeping their clients happy. Fulcrum are a news vacuum and they have the opposite effect! I really wish someone on the BoD would get a grip of the news output and start showing a little consideration for the shareholders. I have written to the company twice - received one positive reply but without any change in behaviour.

"Fulcrum, the leading independent multi-utility infrastructure and services provider, has established a new partnership with Jumptech to support the delivery of its Electric Vehicle (EV) projects for residential customers".

The leading headline on the Fulcrum news site - posted this morning after your comment. The focus is on building/converting residential infrastructure.

Raxfactor - I spotted the battery manufacturers as a growth area about 3 years ago. I focussed on the search and mining of lithium and other rare minerals. I eventually jumped into Rare Earth Minerals which became Cadence Minerals (KDNC) and European Minerals (EMH). This latter is very well positioned with a huge resource on the German/Czech border which is perfect for the European giga factories. EMH is now on NASDAQ as well as FTSE. They were speculative buys at the time but have paid off quite well.

This isn't a recommendation at all. I just agree that there is a synergy between investing in FCRM and EV battery production. Also between FCRM and the continued building up of renewable 'farms' - wind or solar.

I guess we are slightly off topic, though in a lateral sense this is relative to FCRMs involvement in designing, delivering & managing infrastructure.

Have vehicle manufacturers all agreed a common fuel cell design for EVs? Is the replacement a simple process - like swapping out a couple of AA Duracells? Do the forecourts have banks of fuel cells all being charged up. My sister just wrote off a BMW i8 Coupe by driving over some iron posts and ripping through all the battery located in the chassis - I just can't see how fuel cells in a car like that could be swapped out.

I do wish FCRM could be a little bit more 'up front' - they are a news black hole and it becomes very difficult to maintain investment interest when the company doesn't give positive feedback on how it is winning or delivering on contracts.

She is the Chairman and it would be a strange arrangement if she didn't have skin in the game. It's an odd purchase though - 24,960 @ 40p = £9,984. For a clean £10,000 she could have had 25,000 - far more satisfying. Holding 40 short of a decent round number would totally blow my karma!

https://www.youtube.com/watch?v=MjkD1raVv-M

At about 1.30min into the short film there is a 'forecourt of the future' and it includes hydrogen. It would be quite wrong of Bayford/FCRM to focus exclusively on EV. Just as we have petrol & diesel (and in some countries LPG) today then in the future it will be EV and H2.

The point about H2 is that it can be delivered as shown in the film. EVs will be recharged from off the grid, from a battery on site drawing off the grid/local renewables in quiet periods or by simply replacing battery packs on site. It must be difficult for the industry to work out which is the best option and for that reason I still think FCRM needs to be balanced and capable of designing, installing and maintaining both electric and gas systems.

The big purchase last week has not triggered an RNS to record an increase in the interested parties positions nor has anyone reported crossing any thresholds. One must surmise it was just normal trading activity, albeit unusual for such a lightly traded stock.

We conjectured that Bayford were active recipients. This now looks unlikely as they would be required to report their increase in interest and that has not happened.

2020 sure was dreadful. The sp pretty much halved after the suspension of the dividend. Its slowly coming back but seems range bound in the high 30s to low 40s.

I think your perspective on the forecourt is interesting but represents only one quarter of the picture. The government have set the requirement for all new vehicles to be non ICE by 2030. At the moment the choice is battery/hybrid but the runner coming up very fast on the outside is hydrogen. There seems little doubt that commercial traffic will be using hydrogen because it is more efficient than batteries.

So the infrastructure of the future will need to include access to electricity and hydrogen. I expect the future forecourt will need both. All big commercial operators - railways, docks, construction/quarry/mining, haulage - are going to need hydrogen and finally every new housing estate will need to include vehicle charging points built in with the potential work for retrofitting the current housing stock.

So the big potential pot of work for Fulcrum is not confined to designing and installing the electricity infrastructure. It should also include the design, build and instillation of the hydrogen infrastructure. This latter is going to be every bit as lucrative as the electricity. Just take a glance over at ITM (another Sheffield company) and see the government & EU sponsored activity in pushing hydrogen superhighways to facilitate commercial traffic.

FCRM are well positioned to ride two horses - electricity/gas - and they need to remain balanced across both because that really could be a unique and valuable USP.

Again an uneducated assessment is that the RNS agreement (05 Jun 20) establishes that Bayford & Harwood must stay within the boundary of 10-20%. If either venture above the 20% of FCRM Equity they have broken the agreement.

What that means in reality I do not know. Presumably they are 'hostile' and must 'put up or shut up'. However there may be legal implications given they accepted the limitations imposed by the public agreement - are they for example contractually bound to remain below 20%?

Holdings as at 20 Dec 20 from the FCRM website:
Name of shareholder Number of ordinary shares Percentage of share capital (%)
James Sharp & Co (Bolton) 37,148,047 16.72%
Bayford & Co Ltd (UK) 32,423,981 14.60%
Harwood Capital (London) 24,515,000 11.04%
Killik Asset Mgt (London) 12,593,986 5.67%
Hargreaves Landsdown 8,473,168 3.81%
Asset Mgt (Bristol)

I agree. Sharp, Killick and Hargreaves are all brokers and their holdings are possibly proxy holdings for clients.

Yes. 1.8million shares changed hands at 14.53. That's the largest trade for a long time and the sp didn't budge. So my uneducated interpretation is that this was a transfer from a willing seller to an arranged buyer. Had someone dumped that many the sp would have dropped and similarly an open buy order would have moved it up.

Look out for an RNS in the next couple of days to explain who it was - Dare we assume it was Bayford moving up through 15%? Still a way to 20% though.