Member Info for Simon_Said

People don't seem to realise that's how you grow a business. If they didn't reduce the rate, they'd likely not have won the migrations at all. £3m is better than £0m.

That's the beauty of it really, Genghis - there isn't just one drillbit, there are 6 just this year and more to come beyond.

Additionally these are appraisal-stage projects rather than exploratory, with most having history of oil shows in one way or another.

It's quite hedged for an AIM company and makes sense when you consider that the CEO's originally planned for this to be a fund.

If you recall there has been a lot of talk from Bango about the value of getting Google Play route migrations to the Bango platform as there are several billion dollars worth of potential EUS to tap into there.

Thus it makes sense to incentivise for these contracts due to their sheer size. A lower fee for Bango will have helped them win very large contracts. The net effect is more cash to the bottom line.

These are all recent so won't fully show in this half's figures, but unless the discount was to the point of destroying all profit, then incentivising clients with extremely large potential EUS using discounted transaction fees is the correct move.

Bango execs aren't idiots and if they're discounting to get greater EUS throughput, there is a reason. I strongly suspect it's to do with monetising that data via tech from the Audiens acquisition.

We await the reveal of whatever product is being created using Audiens (a new enhanced version of Bango Boost, a data insight product, etc).

Yes I saw that, slowburner. So the actual revenue received from these was all in one go, but they will report it as annualised in accordance with IFRS15 (International Financial Reporting Standard). This will add further to the already-historically-larger H2 revenues.

Iceberg I believe the confusion is over your phrasing 'Bacanora seem to be insisting today'. People are taking that as your read on the RNS rather than your ear to the ground in the city.

One thing from that presentation we haven't talked much about is the strategy for California, which I find most exciting.

They're going to run them as producers (hence 'Reabold Resourcing' suddenly popping up I think). This means not only is the company already cash-positive ahead of any asset disposal, but also they are mere months away from a consistent income stream, on top of all the other projects with their varying strategies.

Just nothing else like this on AIM.

Yes it is peculiar, some are just traders who have left now there's been a trading update and they think it's done for the next 6 months.

Of course a look on the RNS tab shows how often news comes from Bango and there are still many irons in the fire yet to be revealed. There's also a key moment coming up where run-rate profitability translates to cash profits, which is imminent purely by continuing as they are, let alone with their continued exponential (literally) growth.

Reading the RNS again, I think the part about Audiens and the cash spent on its debts requires some further discussion as, counterintuitively, it's actually a hidden gem here.

If Bango were prepared to acquire Audiens and pay off its development loans, one must ask why. Ray didn't buy it for a laugh.

It's pretty clear we'll see an advanced data product (either as an additional service to current customers or a new service selling insights) using Audiens's data. Why else buy it and take on the significant debt pile?

You simply cannot talk about the debt without asking why it was worth it to them. If you look at Bango Boost, their first data product, it's clear they have long-held ambitions to monetise the data they collect through EUS. In today's RNS, where they talk about the sweetheart rates being given to some new contracts, the following line stood out to me:

'Bango technology enables data generated from EUS to improve marketing effectiveness for customers, generating additional revenue for Bango.'

In other words, we need EUS because we need data. And data products like this are almost 100% to the bottom line, because they simply require the building out of the systems to capture and analyse the data, and then more-or-less run themselves. If it's done right, it's a license to print money, and that's why there is a huge rush to monetise data insights across the tech industry and has been for a number of years.

Watch this space. The purpose of the Audiens acquisition has yet to be revealed but the direction of travel is extremely clear.

I don't understand your post shareaction, as there is no way to 'bypass' market makers - they are the only entities authorised to facilitate trade in the securities. I share your concerns about them but no one site can 'get around' them.

Anyway back to Bango eh? Strange selling down here given these people can't possibly be in profit. Suppose some just wait for trading updates and then toddle off for the next one. But as we've discussed below, more announcements expected to come and I think they'll come to regret dropping shares this crazy low.

Results look great to me, every time this 'eus doubled' rhythm repeats it's exponentially more impressive, given its obviously a larger numerical feat to double each time. Looks to me like they wanted to put something else in and were waiting, but in the end the timing didn't work out. This trading update is very positive and contains nothing they would have been prevented from releasing. As such I agree with pensioner that another announcement probably follows.

At the presentation the other night Malcy was talking about how the higher oil price takes time to feed into the junior E&P companies and start affecting valuations, but he thinks that is gradually starting to happen. Reabold's solution is to buy at that particular moment, which SiloLondon just made a nice graph for on Twitter (using Paint!).

I think lots of companies in this space with quality assets will do well in the coming months with the solid oil price, and no more capital leaving AIM for crypto like it was last winter (didn't we all have someone messaging us urging us to punt on their dodgy ICO?).

Reabold is a nice way to spread and limit risk across a number of projects and that's why I feel most comfortable here. We have all been burnt on companies whose valuations are built on a single drill event or region. This is the very opposite, but conversely a single strike to validate a project NPV would make the market cap here look silly pretty quickly (applying even a modest premium to book which is valid only once an asset has flowed).

Squeeeeeeeze

I have just checked with Camarco, the slides which were going to be used in this talk are the same ones already on the website from the Oil Capital conference, which I believe is this:

https://reabold.com/wp-content/uploads/2017/10/Presentation-Oil-Capital-14-06-18-FINAL-inc-BCL-EDITS.pdf

Stephen @ 1hr5mins

https://www.youtube.com/watch?v=VnLdlAV7J10

There weren't even 3m available so that must have been a worked buy over time. Nice.

Stephen was clear that he doesn't expect the market to attribute any value to these drills until they strike, because that's the nature of the risk-off market right now, a legacy of the oil price drop a few years ago is that it's taking time to restore confidence. The market's trust is not easily won back despite oil prices recovering.

That is why Reabold's strategy is to acquire assets that are on the cusp of drilling - because that's the point where the market suddenly 'wakes up' and attributes value. This is what Reabold mean about the 'steep part of the value curve'.

In a functional market this wouldn't exist as there would be more of a risk-weighted premium for exposure to assets. But in the current market that is not happening much (across the board) and that is key to why Reabold's strategy exists.

So in a weird way, I agree with Persimmon for once. No great booms here till drill time. It should creep up as we are getting to the precipice of drills, but the big moves will come when there's black stuff coming out the ground - which is handily only 4 weeks or so away, and then 6 drills (so at least 12 RNS's and likely more like 18-25) all across the remainder of this year. Plus another asset announcement yet to come from free cash. Plus ongoing production revenue from California once they're flowing.

This is just not an accurate description of this placing.

This is a pre-arranged closed book, with a single bookrunner going to preselected institutions with no prospectus. That can only mean they have been briefed.

Secker isn't an idiot and he knows that letting chunks of the company go too cheaply could threaten his life's work. The BoD have a lot of shares, and the risk of a takeover outside of the terms they would prefer will loom large in their minds.

They just won't let this go too cheaply, it would be counterproductive.

Come on Tomcat, you've been around AIM a while, you know how this goes - PI's always dump shares when a placing is announced until they learn the price. We've all seen it before.