The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
If you want to be cynical then the 4m volume last Friday & resultant 10% jump looks a lot more meaningful than a subsequent 5% pullback
Classic behaviour to shake out weak hands ahead of Tuesday's results IMO.
Worth flagging the Capital Market's Day slides from last May; https://www.cardfactoryinvestors.com/media/sl0nstlz/cardfactory_capitalmarketsday_final-slides.pdf
Slide 94 is the key one
"Restrictions on payment of dividends continue to apply until CLBILs and certain term loans are repaid, these
restrictions are expected to be lifted after January 2024."
"Board intends to maintain a leverage ratio of between 0.5 and 1.5 times1. Provided leverage remains within this
range it is the Boards intention to pay annual dividends based on a targeted dividend cover of between 2 and 3 times
the groups consolidated post-tax profits."
Leverage at the HY results was only 0.6x, so there is clear headroom, particularly when they are trading at the top end of expectations.
Income funds & investors returning to the register should provide a significant boost.
Quite the week here! The fundamentals are heavily set towards this continuing to march higher - they've so far completed just over 10% of the buyback, so still have around £22.5m to deploy. At present the quote is well above the advertised ask, with them wanting 68p for 30k shares. If the major shareholders value FCN at even half of what it IPO'd at (£4) then we are in for quite the ride.
So many impatient sellers / profit takers. If everyone stopped selling for an hour this would be over 50p in a flash. If there are 3 consecutive buys the ask moves up instantly - that tells me we'll continue moving up once the consolidation phase is complete.
Based on updated broker notes by Edison & Cavendish, FY25 EPS is now forecast to be 2.74p, this compares to the prior forecast of 1.1p for FY25 and 1.07p for FY24 (now 1.3p) . So on Tuesday, shares were trading on a FY24 PE of 25x and FY25 PE of 30x. Today they are trading on an FY25 PE of 18x... This plainly doesn't make sense, particularly with the Starlink relationship now formalised.
The minimum I'd expect would be a re-rate to 25x the FY25 PE, so a target of 67p. Of course this doesn't include the very real potential for additional starlink orders at additional frequencies, so the reality is I think the fundamentals could support a 30x PE given the nascent size of the LEO industry & expected growth over the next few years.
Was looking into the buying history of the current largest shareholder Teleios Capital Partners LLC to understand why they have been selling. It was pretty interesting.
They bought a 10% stake from Invesco / Woodford back in mid 2019 when shares were trading at £1.80 range. Then covid hit and sunk the shares, they doubled down and added another 31m in the 30-40p range, giving them a likely average in the £1.10 range.
When shares regained this level last April, they started reducing heavily, and at last update in Feb they were back down to their pre covid holding of 37m.
This is fairly obviously why shares have been stuck in the current range for the last 12 months on a sub 7x PE.
Now they have seemingly reduced their exposure considerably, you'd think that they would want to run the remainder of their holding back up to fair value, which is surely around 12x PE, where shares traded in 2017-19?
It could get US interest - the last LSE small cap company which garnered a US following was Ilika, which was pushed by Matt McCall etc. Doubt it'll be via the OTC listing though, given the likely illiquidity. Suspect this moves higher over the coming days once profit takers are out, if it was a private company and signed a deal like this then the valuation would certainly have at least doubled IMO.
Kat-079, not sure you've thought about that much... If they bought the shares back and cancelled them, then issued the vested inventive shares to employees as they have done in previous years, then there would be the same number of shares in issue today? You also need to read note 24 - share based payments - in the annual report, as it the shares aren't given away by any means...
Also, if they paid a £10m dividend rather than buyback the 566k shares then right now the share price would be 40p lower (43.5m shares / £877m market cap - £10m dividend). You'd have a ~23p extra dividend, but lower share price...
You then also have to factor in that 566k shares would have been pressuring the share price, so it's highly likely it would still be sitting under resistance at £18
As for letting shares drift, would you be happy buying today at £12 and then waking up tomorrow to a £18 takeover offer?
For long term holders, a buyback at these levels make loads of sense. A lower number of shares in issue = a higher share price in future years. The ROI should end up way higher than a 1% dividend yield at present levels...
Yep I'm eagerly awaiting the prospectus. Re. Share buyback quantities, they've purchased 566k shares in the 58 trading days since the buyback commenced, so just under 10k per day. At that rate they would buy back just over 5% of the company per annum. Given the ~85% institutional holding here that is massive.
Another critical part of the bull case here is contained in this presentation deck from way back in April / May 2007; https://www.slideserve.com/thora/april-may-2007-private-equity-financing
The fact they were planning an AIM listing in late 2007 / early 2008 pending receiving permitting tells me that they very likely had some fairly advanced modelling of the resource, CAPEX requirements and near term plans...
The fact that they had also received the first foreign forestry and environmental approvals in Rajasthan way back then also has to be pretty useful in terms of negotiating a settlement
Agree on using the likes of De Grey as a benchmark, but think we should be using post tax NPV numbers rather than market caps, which would put De Grey at £1.5b based on $1700 gold...
Indeed;
"The Board carefully considered the difficult balance between further dilution and the Group's cash resources to deliver key value adding milestones from the upcoming AVA6000 efficacy studies. On this occasion the Board has decided to settle the quarterly repayment in shares but will continue to review this on a quarterly basis and, if it considers that conditions allow, the repayment will be settled in cash."
Impossible to believe you can be so foolish as to raise at a near 60% discount to the 200DMA and then mention that some of that money could be used to repay a CLN... talk about cost of capital!
7.5M conversion shares issued for a £2.55m CLN repayment + £620k of interest, meaning the conversion price was 42p...
Nice to see Swedbank through 3%, they've added ~250k shares since the end of March which was likely what propelled the share price higher. Likely wanting to get to their position size before facing more international competition. Also notable that Alpha have bought back around 150k shares this month so far, a significant step up from Feb & March.
I'd expect Harwood to take their stake towards 10%, it's what Mills has done in his other holdings. The main thing is that they wouldn't be getting involved unless they saw significant upside & combined with the buyback & rock solid major shareholder list, it all looks really positive. It's currently musical chairs, with Zedra reducing, but once complete then we should see a strong move higher.
Brilliant news to see a TR1 from such a distinguished investor, rubber stamps the appeal down here.
Surprised that they haven't published a timetable though? Based on Breedon's move from AIM to premium listing last April, the prospectus was published around 7 days before AIM trading was cancelled, so we should expect something some time next week.
Great find PK
Here is an article from the same publication dated 26/02/2013 which states Indo Gold discovered the bhukia deposit;
https://www.business-standard.com/article/companies/australian-firm-strikes-gold-in-rajasthan-107022101011_1.html
"Indo Gold Ltd (IGL) of Brisbane has struck gold in Jagpura region in Rajasthan. The company has discovered 1.74 million ounces of gold at the Bhukia prospect. Once IGL gets its prospecting licence, this would be the first ever open pit gold mine in the country."
"The area to be explored is arid and underdeveloped so there are no issues of resettlement and rehabilitation. However, Higgins said the government was taking longer than usual to grant the prospecting license.
The company requires both the state government's and Centre's approval for getting the prospecting licence."
Vs the 24/02/2024 article you posted which states;
"About a decade back, the state had discovered 113.52 million tonnes of gold ore in reserves in the Bhukia-Jagpura village of Banswara district."
To clarify, they didn't just miss guidance by 10%, it was a whole lot worse than that.
1. In the 22nd Jan trading update they confirmed that unaudited FY23 revenues to 31/12 were in line with guidance at $340-360m, today they changed this to $318-323m post audit, so it appears that ~10% of revenues weren't signed off by the audit team.
2. FY24 forecasts were slashed, previously revenue was forecast to be $403.9m, now it's $340-360m, EBITDA was forecast to be $109.8m, it's been slashed to $70m, a 36% reduction...
3. FY25 is now forecast to see top line of $450m at 20-25% EBITDA margins ($101.25m EBITDA at the midpoint). Prior forecasts were for $497m & $151.4m EBITDA (30% margin). So this is a 33% cut in EBITDA and a 25% margin cut...
So many downgrades it's hard to count, however the 36% reduction in FY24 EBITDA easily justifies the 28% fall in share price today.
I can only presume that the Deutsche bank upgrade was issued prior to today's results, otherwise they've effectively upped their EBITDA multiple from ~9x to 14x in the face of severe downgrades.
Last point - the comments on this thread prove once again how ridiculous it is that UK PI's don't have free access to the high level forecasts that these companies are reporting on...
Sorry to hear @koolhead. I've called this out many times over the last couple of years, in my opinion the way it reports results should be outlawed as it obfuscates performance to such a degree that the numbers become useless.
A shocking company which in my opinion has well and truly taken the p*ss out of UK markets & the FCA.
Indeed, surely that's inside information & at the very least shares should be suspended until the investment is concluded. The main reason for a suspension should be that the 'tier 1' investor will know exactly what they will pay per share & any rise in share price off the back of today's RNS is therefore a false market...
"What happened when their claim figure was declared through an RNS?"
GreenX were trading as Prairie Mining when they released the £806m claim on 9th June 2021, shares closed on 8th June at 13p which valued the company at ~£30m based on 230m shares in issue. The day of the release shares traded up to 21p, valuing them at £48.3m / 6% of claim value. They have a similar setup to PAT with some early stage projects but the claim certainly underpinned their value (before signing their A$18m LFA with LCM, shares traded at 6p / £12m market cap).
PAT is currently valued at £12m, if they file a similar size claim to GRX then based on the above we should re-rate quite considerably. But that's simply my opinion & nothing else :)