RE: NICE27 Sep 2022 10:21
Bruno - I’m not sure people are underestimating the news on NICE fast tracking their assessment of AIHL but rather more that they’re aware that the guidance won’t be out for another 6 months and the significant income for GDR will not come from sales of the machines but the tests that are constantly being run once the machines are installed. GDR somewhere said they were hoping for something like 110 installations (was that in the last investor presentation somewhere?) in the UK. That’s not the number of machines but the number of Neonatal units that will use them. Could be 500 machines but the crucial thing going forwards is how many tests are run each year. That income will arrive at a steady pace as soon as machines are installed and switched on but we’ll only know or be able to estimate roughly what the annual income is going to be after say six months. So, that’s 12 months from now. People like me who once believed in GDR and have stayed with it in spite of the continuous decline in the sp are already invested (and down over £100k) and, speaking for myself, not inclined to put any more funds in until I hear Budd is finally making some progress on commercialisation. Then and only then will I be tempted to lower my average further.
As things stand I can’t see any meaningful income arriving into the GDR coffers over the next 12 months - and certainly not enough to cover the£2m cost of gaining US approvals to sell AIHL there - so this is a much longer hold than I’d ideally like. There are far better opportunities for investors elsewhere at the moment than GDR and that’s why the sp ended up flat after yesterday’s RNS, which I felt was excellent news.
The knock on effect of this fast track process might be that the stroke assay will also be brought forward and a meaningful reputation for GDR is being steadily established, albeit slower that we’d all like.
In a year’s time I can see the sp being back nearer 25 or 30p but for now I think all eyes are on where Budd is going to get the money from to keep GDR going until 12 months time. They simply don’t have enough in the bank so it’s either an announcement proving we’re making significant progress with sales on Covid PoC kits or….it’s another placing. And there in lies the rub. The market has seen Budd fail to deliver on promises and deadlines for three years now so will not be kind when he comes with the GDR being bowl again pleading ‘please Sir, can I have some more?’ If the prevailing sp is 12p when he needs to get the extra funds in place then it will be at another large discount and going on previous deals he’s managed imho we could be looking at 8 or 9p.
Without sales Budd is in serious trouble over the next 12 months so for all our sakes I hope he surprises us with an RNS saying we’ve sold half a million quids worth of product and that will be Kick off to a new chapter in the GDR story.
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