Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Moni, I write on here once in a blue moon, not multiple times per day, day after day. Point is, today's results are underwhelming. For a couple of years now the order book is always full (one and a half years ahead - which is brill) but yet revenue in each reporting period is always lower than expected, with reaching expected targets always looking difficult. H2 revenue needs to be 30M to reach target, a 50% uplift on H1 revenue of 20M. Achievable, possible, guidance being maintained, keep the faith.... yes, ok we keep the faith and hold, but the reality is 20M revenue in H1 and throwing in a few post end period numbers to keep investors on side. These are not great results yet again. And what news on spin-offs? SP reflects all of the above.
Let's hope for shareholders the name change is the most significant news today. After the years of lies, BS and huge reputational damage caused by O'Spiel, a re-brand is perhaps the next best thing instead of a takeover to clear away the past. It will make no difference to clients as they already know the hVIVO brand but may make a difference to investors.
Results - same old, same old. 19M revenue in H1 vs 50M for Y22 target. No explanation for shortfall. Leap of faith that it is made up in H2 and have to wait 8-9 months for full year figures to be published. Just really disappointing and SP barely moved.
In the last two years OO has been loss making and not generated any cash other than that used in investing in the business so until that changes, it would seem folly to start paying dividends or engage in share buy-backs.
They raised this cash two years ago on the premise that having cash on the balance sheet would help them win contracts with big pharma. Presumably that has not changed.
I wish the company would come out and be definite on these types of things. CF talking about a cash dividend during 2021 was complete nonsense. All it did was destroy sentiment and confidence when it ddin't happen. At least Mo seems more circumspect about such things. Wish some PIs would be the same.
Ricky - turnaround in EBITDA and revenue growth, all good and with you there. i'm not anti. Just making the point that ultimately they had a net loss last year and cash did not increase.
Yes, I have seen revenue guided as 50M (+Covid work, whatever that might account to) but no, I haven't seen the EBITDA guidance. If you quote it or can point me in the right direction that would be appreciated.
Also, how much is the Covid work - 1M, 5M, 10M, 15M...? on a fixed cost structure, the extra revenue should go pretty much straight to the bottom line and make a significant difference. How can anyone estimate profitability with any certainly when some revenue is simply parked to one side outside of the guidance. I am invested but not emotionally attached so I'm finding it very difficult to invest any more money when things are simply unclear and there are plenty of other safer, surer investments to be made elsewhere.
Stt1, agree with you.
Cash on a certain date is transitory so not sure is particularly useful. What is clear is that two years after the placing, OO has less cash than it raised so is neither profitable or generating cash in any meaningful sense.
The company only refers to revenue. Surely a company with a strong forward order book with predominantly fixed costs should have a good grip on what profit and cash they plan to generate and they should be able to provide forward looking guidance. Yet, they don’t. It’s no surprise the SP is where it is, until they get their act together.
The biggest plus in the past year is that Charlatan O’Spiel has gone off radar so there is at least a chance of restoring credibility.
Seen a few messages re: hopes for dividends. Seems bonkers to me. Think there is a stack of cumulative past losses to be made up first before dividends remotely possible or special permission obtained from the courts.
Well, this is what happens to a company and SP when management get big headed, make a series of misleading statements and outlandish promises which aren't kept and lose all credibility. Things could and should have been so different. A T/O here looks like the best way forward. Unfortunately can't see that any time soon either.
This POLB spin-out is a fiasco. Some shareholder have their shares after the lock-in and other still don't days later. What was the point of the 9 month lock-in. To support the SP, which has more than halved anyway. Just shows the 10p valuation was over-priced and suckered in new investors at over inflated prices. If it was fairly valued and the business had a good business case, the 9 month period was never needed. Worse still, shareholders who were happy to receive 'free shares'. They were not free. Simply a dividend. A dividend that was already owned by shareholders. Normally dividends don't involve the Directors creaming off 5-10% for themselves as motivation and don't involve the payout, of 3.3p equiv at the time being only worth 1.5p by the time shareholders actually received. Let's hope the next spin outs are such a complete and utter shambles and don't involve more pilfering by the greedy Directors.
Pretty sure the results will be underwhelming. SP tells us that already. H2 revenue was supposed to be much higher that H1 but wasn't. Cash balance is almost exactly the same as the cash raise almost two years ago so for all the promise of cash generation every month, I don't see it. Spin outs are nowhere and Charlatan O'Spiel will not be around to face the music.
No, just shows a few million shares purchased is nothing compared to more than a billion in issue.
Ash is quite correct. This needs a white knight or a change. CF’s reputation is shot to pieces. Take your pick:
“Share price doubling every 6 months” – embarrassing.
“£1 bn company” – embarrassing.
“DIM spin-off in progress” - 2 years have passed and still no timeline in sight.
“Not signing wearables contracts as ‘messy’ until new entity established” – lack of any revenue in past 2 years outweighs any creation of shareholder value that may or may not come from alternative arrangements.
“Not awarding stock options” - then awarding 5% of spin-offs for ‘motivation’.
“Removed CEOs to save money” but having insufficient resources to progress matters and ending up with 2 CEOs (OO and POLB) anyway
“Generating cash every month” - present cash balance reflects what was raised 18 months ago.
“H2 2021 revenue to be significantly higher than H1”. Reality is it fell.
Could go on. CBA.
SP at 14p says it all.
Has anyone tried the link in the RNS to the 8th March presentation
https://us02web.zoom.us/webinar/register/3816460478728/WN_kyeX1ibCT0aXEUdkO9gIOg
It refers to three companies, none of which are OO. Are they presenting or not?
Wonder what O'Spiel they will come up this time.
Let's hope this time there is something that can provide confidence and credibility.
Exactly. Especially any CF podcast.
More like a dodo
So what would the point be of raising £12m in May 2020 at 11p a share, keeping the cash on the balance sheet doing nothing just to buy shares back at 17p less than 2 years later. Seems like complete nonsense to me. Why was the cash was raised in the first place - to booster the balance sheet for getting contracts with Big Pharma. What's changed since? Answer nowt. Half yearly results indicated cash balance at year end would be approx same. Best they hang on to their cash as they aren't generating much, if any.
Nice chart but what does it show. To me, shows a) the 25% collapse in SP between CF stating he would buy his shares in the next day or so and his eventual purchase many weeks later after the news vacuum affected sentiment; b) a string of contract wins, showing the core business to be in good health but unable to support an increase in SP and; c) SP treading water in H2 once it was clear that EBITDA in H2 would be minimal, if any.
Let's hope increased revenue in 2022 off a fixed cost base will lead to a recovery in SP. Rest is noise.
Hi Elrico, thanks for your post. I don't spend hour after hour, day after day following these BBs so I didn't see your podcast until 10-12 days after the event but it was good and informative and certainly gave an update on the timing of the DIM spin-out, so thank you for that. It's easy for PIs to miss such links, so my point is I would much prefer the company to set out a timeline in a RNS and then stick to it or do any update, rather than this continual drift. In the 2 years I've been invested, OO has received no revenue from DIM and imho, a CEO should have been appointed sometime ago to drive it forward as a) he'll be needed anyway after the IPO and b) the revenue that could have been generated would have paid his salary costs. DIM's revenue will not be time/subscription based and not the type that can be delayed and caught later. A delay is simply revenue lost and these are the types of questions I would like you to put to him in your next podcast. Anyway, keep up your good work. ATB
Ricky, I agree with you - there is only a finite amount of management time and on one hand it does make sense to focus on POLB rather than spreading themselves too thinly. That said, they should increase their managment capability to get DIM up and running. How much is the cost of an extra body or a CEO (a few hundred k p.a.?). Compare that to the loss of revenue from DIM not signing contracts / generating revenue (a few m p.a?). Over a year ago we were told OO would not sign wearables contracts as it would be 'messy' to transfer contracts over to the new entity (complete BS). Now it is not having suffcient management time / resources.
Either the revenue that could be generated by DIM does not justify the cost of putting management in place or OO are failing to put a management / resources in place to develop DIM or things are being deliberately held back by OO management for their own benefit at the expense of OO shareholders. CF has now indicated a delay in DIM until at least April / May. This continual delay and failure to generate any revenue from DIM throughout this period is not justifiable.
Thanks whoever posted the link to the Elric interview from 10 Dec. Once again, I find the message from O'Spiel completely disgraceful.
Just over a month ago, his guidance was that DIM was to to be floated just after Xmas, early in the New Year.
In this interview he linked DIM's IPO it to getting POLB in shape first, defined by an increase in SP, hopefully by Jan/Feb and then a further 2-3 months from the decision to go ahead to IPO.... so now we are are looking at April/May at the earliest for DIM. Who knows what POLB's SP will do in the next couple of months. Nearer the time a failure in POLB's SP to rise will simply be a reason for another delay.
Any why is DIM now linked to POLB's SP? Where is the logic in that. Just looks like a complete failure to put in place sufficient high level management to deal with all issues in a timely manner for the benefit of all shareholders, to provide O'Spiel the chance to cash in POLB shares so he can raise enough funds for him to reinvest in a larger stake in DIM, all the while providing misleading guidance with the pithy apology of being overexuberant in the past.
To be fair to all shareholders he should put in place a clear timescale for the spin-offs and put in place a sufficient management team so that objectives are set and met to a defined timescale.