Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
I have submitted a number of questions around:
1. The share consolidation
2. How the £10m funds raised will be used
3. Why have they appointed joint corporate brokers
4. When will break even / move to profitability be achieved by?
Disclosure: I am currently in a very happy mood following massive jumps in the US tech shares I hold. They are shares which I invested in for the same reasons I invested in Itaconix. The bear market for tech shares is finished. I firmly believe that Itaconix is going to make a big jump up on the next trading outlook. Itaconix is totally de-risked with £10m on the books. The days of worrying about funding over. It’s now time for Itaconix to spend the cash driving up revenues and launching the new products we have been talking about for years. I say we will double our share price by the 2023 full year trading update in January / February
If people are expecting a trading update soon they are going to be disappointed. Next update will be for H1 so July onwards
In terms of why?
See the 28th Feb RNS. Cannacord hold 9% of Itaconix shares following the £10m placement.
Yet another example of private investors being given the minimum information necessary to remain LSE compliant. Really infuriates me!
My issue with the share consolidation is that the company put it out there almost a year ago and then did nothing with it. It was supposed to help with US investment but now they’ve got the 10 million I presume it’s no longer required for the company. As a private investor it’s disappointing as I’d hoped it would generate new private investor interest in the states.
I increasingly get the feeling that Itaconix are not bothered about the share price as long as they have liquidity which the 10 million now gives them.
This morning I watched the famous Monty Python dead parrot sketch and for some reason it reminded me of the Itaconix share price.
I must admit it did make me question my steadfast loyalty to Itaconix and whether I have become blinkered.
February placing of £2.4m at 0.55p a share
April placing of £1m at 0.46p a share
What price will the next placing be? 0.37p??
This should have alarm bells ringing for every private investor
Miners are always high risk. Boom or bust
The fact the company thought 0.46p was a good price speaks volumes. If there were good news around the corner the company would have waited for that to land and then raise funds at that higher share price and give away less equity.
VAST happy to release RNS at 12.00pm so I wouldn’t go by the traditional 7.00am news release times
On the one hand I am surprised at the drift in share price since the £10m funds raise. Considering the very low cash burn rate now that the company is approaching break even, investors should realise that these funds are for more than just the day to day running of operations. They fuel the massive scaling up and remove IMO any investment risk during this scaling up period. Also £10m is a small amount of money compared to the revenue growth this will enable.
On the flip side I am not surprised because of the general negative market reaction to raising funds. Thankfully on this occasion I think the market has got it totally wrong and believe future trading updates will see impressive growth in revenue and share price. We are also moving back to a bull market for tech stocks which will move us from head winds to tail winds.
..we get closer to a RNS on the diamonds. These things take time but patience will win the day. Hoping RNS doesn’t land until after new tax year begins so I can top up my shares ISA
Oh definitely AJP.
Patience very much the key. I think I the current share price is a nonsense when they now have £10.5 cash but the market cap is just £33m. It looks like we will have to wait a little longer than I anticipated for the share price to start moving but once it does I think it will be impressive.
Whilst Itaconix was very successful raising funds through institutions it seems it was less successful with the open offer to qualifying shareholders:
“ the Company proposes to raise up to a further approximately £0.4 million by the issue of up to 7,760,852 New Ordinary Shares pursuant to an Open Offer to Qualifying Shareholders, also at the Issue Price (the Placing, Subscription and Open Offer, together the "Fundraising").”
Only 4,513,420 shares were bought by qualifying shareholders. So circa 58% of shareholders took up the offer. Whilst it is of little consequence to the £10.5m total raised it does suggest that 42% of existing shareholders are not currently impressed with the company’s performance.
If you were one of the investors who had formed out your portion of 10 million bucks to buy Itaconix shares at 5.1p, you would be topping up now the buy price is 5% lower?
Maybe the current share price is a reflection of last weeks market turmoil over interest rates and banks. Either way the current share price looks a very good entry point for investors and I can’t see it staying sub 5 pence for very long.
Cheers Dougerboy there’s no doubt about the long term it’s just the question of when does this take off. I’ve been patient this long I will probably just remain patient. Hopefully now that the fund raise is out the way, the next trading update will knock it out the park in terms of future outlook and plans
Obviously I’m heavily invested in Itaconix and a strong believer in the long term future of the company. However, I find myself asking the question would I be better off investing funds elsewhere over the short to medium term and then reinvesting in Itaconix when we start to get some momentum in the share price?
The massive fund raise gives the company stability and the means to grow the business in line with projections but it seems it has also killed off any short term increase in the share price.
Welcome any thoughts on when fellow investors think some upward momentum is likely?
RR regarding the $10m new business in 2023. That is what it will be worth when you get the full year effect but this year we will only see a part year effect as we on board the new business. We will have to wait until 2024 to see the full $10m.
Trawling through Cannacord’s website I think they will be on board a long time Dougerboy.
Cannacord are big - like really big. In Quarter 3 alone they took $382m revenue. Total client assets in their global wealth management business were $94.4 billion at December 31, 2022.
The two thoughts that immediately came to my mind were:
1. These people are experts at recognising a good investment opportunity. I’m sure they have been given access to a ton more information than the limited info we get in the trading updates / financial results. So they must have liked what they saw.
2. If they didn’t see massive growth ahead at Itaconix they wouldn’t be bothering with a company who pulled in just under $6m of revenue in a while year.