Member Info for ShearClass

Would be nice of management to update the market on the California launch, all looks to have gone well with a statewide service now in apparently operation; https://solunaapp.com/

Just needs an RNS to reassure the market & highlight that the majority of execution risk has now been removed...

Just needs a little bit of volume and we'll be off...

Excellent start to the year - all systems go...

"Following the delivery of the NoD and in the absence of any meaningful correspondence in relation to this matter from the Government of India or if no amicable settlement is reached, IGPL will subsequently deliver a notice of arbitration to the Government of India. Any such notice of arbitration is anticipated to be delivered to the Government of India in this first quarter of 2024. Under the Treaty, an arbitral tribunal is to be constituted within two months of delivery of the notice of arbitration."

LIT & Fasken are managing / funding the litigation process, PAT are not legal experts and likely have no internal expertise, they certainly won't have much to do with the arbitration filing which will be very technical in nature. Likewise the claim quantum. So once they provide the info, PAT will release it...

Good to see only 3 early sellers & NT for more than 75k shares into close, should make traders think twice about jumping in and out.

Ps. Mickey, there is no £499 man, it's just a common amount for people to buy / top up!

Newsflash;

- PAT will need to spend money over the next few years whilst the claim is progressing... £1.4m per annum in costs is immaterial vs the claim size

- The filing of the claim & quantum disclosure are quite obviously driven by LIT & Fasken, PAT are not in control of this

- Early settlement is very unlikely - probably less than 5% chance. The value creation here will be from the size of claim disclosure & what the market deems PAT's chances of success are.

- Excellent to see a near $600k decrease in exploration expenses, offset to a some degree by a $170k increase in share of JV expenses. Presumably the $71k of unrecognised arbitration cost will be recognised in the following period - shows they are controlling cash burn.

- No more disruption from financial filings until the end of September, in that time period it's highly likely we'll learn the value of the claim & be valued at a more sensible chance of success than ~1.5% chance we are currently priced at (based on a $1b claim)

- if the market prices in a 5% chance of success on a $1b claim shares would trade at £39m cap / 22.5p, GRX currently trades at ~18% chance of success (this would equate to 80p per share based on PAT's current 173m shares in issue.

Bottom line - there should be very significant upside from current levels once the claim is filed

Solid report, should be enough to attract some interest as 5.5p to 38p is decent risk vs reward!

Worth pointing out that Allenby estimate a claim mid point of $750m, given PAT have already quoted the times of India article which stated >$1b you could say this is prudent.

At $750m their methodology gives a target price of £0.29p, however at $1b it would increase to ~40p. As we know, there is potential for higher than this which would stretch valuations even further...Add in the fact GreenX trades at ~19% of it's claim value and the upside increases further still.

Nice to see some stability & signs of upward movement, I suspect the additional £150k at 5p made the game obvious too anyone who has been following. It also explains why shares were obsessively kept down by the MM's in August / September when they should really have re-rated to 15-20p. It's filthy but maybe they owed the backers a favour for showing faith in March when funding was still conditional...

Either way, once that claim value drops we will get significant attention, the wider market is also dramatically improving so there is a genuine chance of a 200-300% move if the numbers align to what we have speculated / suggested by the company.

@deckchair, sure - here it is;

"Ok, here goes my claim quantum effort - no investment advice / DYOR...

IMO there are three key factors that will be used to determine the market value of the investment at the time of the alleged expropriation in 2021; the in ground value of the gold, when the expropriation became public knowledge & the estimated size of the resource at that point in time.

I found this 2015 research report really useful to try and put some meat on the bones of some analysis;

http://www.cipherresearch.com/reports/150601_The-Real-Value-of-Gold-in-the-Ground.pdf

It studied 253 transactions involving gold companies between 1990-2013 and determined that the average price paid per in ground oz was $63. The average price of gold over the 24 year study period was $605/oz. So the average transaction paid 10.4% of the 'in ground' value. That may be skewed by the fact that for 16 of those 24 years gold averaged ~$350, but to me that seems like a sensible figure to use and leaves some upside.

The 1999 BIT states; "The compensation referred to in paragraph 1 of this Article shall be computed on the basis of the market value of the investment immediately before the expropriation or impending expropriation became public knowledge"

Based on this link it looks like 15th March 2021 was when the bill was first introduced; https://prsindia.org/billtrack/the-mines-and-minerals-development-and-regulation-amendment-bill-2021

'Immediately before this on the 14th March 2021 gold traded at $1720, so using the 10.4% figure above, that gives us an in ground market value of ~$178.88/oz

Then we just have to apply that to the resource size. IMO there is no chance PAT are just going to claim for the 2008 JORC of 1.74Moz given how much that figure would have risen in the 13 years between then and the official expropriation. However, even if the arbitration panel decided to use that figure it would still come to a claim size of $311m, or some 20x the current market cap. That's the ultimate downside here IMO.

However, it's far more likely that PAT will utilise the 2 resource studies from the GSI, the 6.7Moz from 2014 or the 7.9Moz from 2021 that I posted earlier on.

6.7Moz * $178.88 = ~$1.2b

7.9Moz * $178.88 = ~$1.4b

That's the size of the prize... and before anyone says they could claim for 10Moz+, they would need some reasonable basis to do so, that is what makes the GSI work potentially so valuable."

For anyone wanting to get more info on California progress, there was a product demo a couple of weeks ago which has now been uploaded to Youtube;

https://www.youtube.com/watch?v=4o_gljVrbW0

53mins to 1hr 22 is the Kooth 'Soluna' section.

Accompanying slides are here from 37 onwards; https://cybhi.chhs.ca.gov/wp-content/uploads/2023/12/11292023_Virtual-Services-Platforms-Webinar.pdf

Much to be encouraged / excited about, particularly how heavily involved the youth have been in the design & feel. The feedback from the 2 individuals on the call was excellent & it does genuinely look like a really impressive resource.

Yep, it looked unlikely this time yesterday but all of the previous delaying tactics were abandoned and they got everything approved & signed. Given the timing of the Lane Johnson LinkedIn post I suspect Kooth were aware of the likely outcome & are ready to roll.

This Linkedin post a couple of days ago is also worth reading; https://www.linkedin.com/pulse/congratulations-kooth-ambassador-lane-johnson-his-nomination-5gqqc/

"Over the coming weeks, I’ll be sharing more about the work Kooth is doing in Pennsylvania and beyond. The response to Kooth’s services has been incredible - from parents, teens, educators, and government representatives. But, for now, I’ll say this: Lane Johnson’s influence is just beginning. "

Combine that with a 1 in 10 usage rate reported in the half year results and things look very bright indeed here

The final parts of the Penn budget were signed off overnight, which as per the October investor meet company Q&A should result in the finalisation of our Penn contract in Q4...

https://www.penncapital-star.com/government-politics/shapiro-signs-final-budget-bill-after-late-night-votes-in-the-pa-legislature/

https://local21news.com/news/local/pennsylvania-budget-fiscal-code-education-code-governor-josh-shapiro-speaker-joanna-mcclinton-senator-pittman-education-improvement-tax-credit-criminal-justice-reform-child-tax-credit-december-14-2023

Watch from 5hr 27 mins onwards of this Kansas legislative research department meeting on 6th October;

https://www.youtube.com/watch?v=mP5hZSgppCo

Verbal confirmation that Kooth have partnered with Aetna in Kansas and are working through app implementation for a state wide rollout...

Also, may have been a slip of the tongue but Erin Davis (Kooth VP Government Relations) refers to 'Kooth Therapeutics', which I've never heard mentioned before.

'Kooth is the gold standard model of care for personalised, proactive and accessible digital support'

@Nortel, agree on public bodies being frustrating, however once you are integrated the competitive moat is huge so it will be worth it!

Kansas appears to be the perfect setup; Kooth are working with a huge Medicaid company which will provider many advantages, one of the most important being credibility in front of government. The questions asked by legislature were very positive, there appears to be a genuine desire to find solutions.

As I posted a few days ago, Aetna are present in 17 US states so a rollout beyond Kansas would seem inevitable post a successful implementation (and may already be happening).

Another bit of research that's worth mentioning is regarding Medicaid, as per this line of the placing proceeds RNS from July;

"piloting Kooth with Medicaid to support youth in low-income families;"

Linking back to this post from October; https://www.linkedin.com/posts/janesbrown_such-a-pleasure-to-offer-novel-digital-solutions-activity-7118186301169831936-IKVg?

Jane Brown works for Aetna Better Health, which is part of $100b market cap CVS Health, listed on NYSE

They work across 17 US states proving Medicaid services; https://www.aetnabetterhealth.com

Each health insurance plan provides access to certain services, which are listed here; https://www.aetnabetterhealth.com/illinois-medicaid/whats-covered.html

Piloting Kooth with Medicaid via what I believe is Aetna / CVS provides the first step towards potential integration of digital mental health support across some or all of those 17 states.

They already have offices in Chicago, Kansas & Pennsylvania, so it certainly looks like they are setting up for big things...

Hi Uh-oh, if you go onto investor meet company and listen / watch the last 2 presentations then you'll get a far better idea of where they sit. However, they confirmed in the October meeting that the California contract is self funding - they are receiving ~£12m up front this year to cover hiring, product R&D spend etc. Once the contract formally commences they'll almost certainly be paid in advance so cash should never be an issue.

FYI there was a CYBHI public webinar on Thursday evening which confirmed everything is on track, a recording is here; https://cybhi.chhs.ca.gov/event/public-webinar-december/

This is the portal at present; https://calhopeyouth.org/ , obviously we can't download the app as it's only available in those 2 counties pending full roll out in Jan. However, the fact it's been live since late August significantly de-risks things IMO. Kooth US headcount on Linkedin is now up to 114 from around 15 earlier this year, so hiring appears to be going very well indeed.

The £10m raised in July + the additional £6m they held prior is for supporting US growth ex. Cali & Penn. I.e. Medicaid system work, new research studies, lobbying etc. Mid teen EBITDA margins (no debt) and FCF by the end of next year and a hint at dividends beyond that (not sure that's necessary at this stage), tell you where this could head should things go as hoped.

Hi Nortel,

Glad to see some activity on here & others on the same page re. valuation / drift. On Pennsylvania, it's all waiting on the school codes budget being signed off, the schools mental health budget is all tied up in a larger bill which came oh so close to being signed off 3 weeks ago but was amended at the last minute by Democrats. This is the bill in question;

https://www.legis.state.pa.us/cfdocs/billinfo/bill_history.cfm?syear=2023&sind=0&body=H&type=B&bn=301

Media coverage; https://www.penncapital-star.com/education/fight-over-tax-money-for-private-school-tuition-snags-education-funding-bill-again/

The funding confirmation is on page 73 of the bill itself and confirms that each Penn school district can apply to receive $100k funding support (there are 500 states, so $50m total, unknown what the Kooth expansion will cover, pilot was 30 states @$100k / $3m total);

https://www.legis.state.pa.us/cfdocs/legis/PN/Public/btCheck.cfm?txtType=HTM&sessYr=2023&sessInd=0&billBody=H&billTyp=B&billNbr=0301&pn=2326

Senate is back in session this week so fingers crossed they can get it done this time...

I too think a NASDAQ or NYSE listing will follow at some stage, primarily because they'll need to reward their US employees with stock options in USD. If they can nail Cali, Penn + a couple of additional states & get on board with Medicaid policies then I think they'll be ready to push the button.

The buyer likely doesn't know who the seller is / how many shares they have & yes they'll be dealing via one of the market makers (looks like Berenberg as they are the only MM at 160p). The seller may want to see how desperate the buyer is & if they are too keen they will raise their price? It's cat and mouse, but good progress is being made on a daily basis.

The pairs of trades going through are exchanges between a buyer & seller - so one trade is a buy & one is a sell.

I've just been through the trades and since the plunge on the 24th there have been a shade over 11m of these exchanges, so 5.5m buys and 5.5m sells. 1m of these have come this morning.

Any buying II is going to give the price a few days to settle before stepping in, however they seem to be very happy to now pick up chunks at £1.60.

It's a fairly straightforward picture from here, once the seller is exhausted the fairly incessant PI buying will result in the price recovering back to sensible levels between £2-2.50 in my view.

Oh so quiet here as there has been a gap between RNS'd news which inevitably causes a few under researched PI's to sell &hardly anyone seems to be in the habit of doing detailed research...

There should be a very positive 12 months ahead here, note that the next 3 sets of financial statements are set to show significant growth;

Full Year 2023 revenues of at least £34m vs £20m in FY22, giving growth of ~70%

H124 is when California kicks in, full year forecasts are for £67m, so if this is equally weighted then H1 will show YoY growth of ~180%.

Full year 2024 will then show a further 100% growth on FY23

Add Pennsylvania into the mix + at least 1 additional state + a potentially significant uplift in the UK with a labour government & £100m revenue could happen fairly quickly.

To be trading at just 1.5x FY24 revenue seems crazy, a re-rate to just 3x would see shares double in value and still be cheaper than most AIM listed SaaS companies, nevermind those listed in the USA.

Strong buy IMO and look forward to the next news that lands.

Happy that they've removed the financing overhang by raising at 5p, it's a small amount and won't make a jot of difference to the share price on the reveal of the claim quantum.

£30m market cap / 154m shares = 19.5p

£30m market cap / 170m shares = 17.6p

The realty is that if the claim is anywhere near mooted ($1b), then £30m = 3.75% of claim value. We currently sit at ~1% of such a claim value.