Member Info for TrekMadone

New Accugas gas sales agreement It is good to see Savannah continuing to perform with its core Nigeria gas business while pursuing the closure of the two Chad/Cameroon oil acquisitions. Savannah’s Nigerian midstream gas subsidiary, Accugas, has signed its fourth new gas sales agreement this year, adding high margin volumes that will further optimise underutilised infrastructure. The expected close of Savannah’s Chad/Cameroon acquisitions is fast approaching and will more than double FCF, providing the flexibility to rapidly deleverage while investing for growth and delivering shareholder distributions. Completion of the acquisitions is expected in Q3 and should prove a strong catalyst for the shares, which will be further fuelled by the expected refinancing of Accugas debt before year end. Savannah’s expanding, highly cash-generative portfolio provides a solid platform for the continued pursuit of additional ‘Projects that Matter’ across Africa in its quest to become a significant regional energy player.

- Another new gas sales agreement signed. Savannah’s 80%-owned Nigerian midstream gas subsidiary, Accugas, has signed another new gas sales agreement (GSA) – its fourth of the year – with Notore Chemical Industries PLC (Ticker: NOTORE, Mkt cap US$235m). The contract is for supply of up to 10 mmcfd of gas to Notore’s Rivers State fertiliser plant on an interruptible and reasonable endeavours basis for an initial 1-year term, extendable by mutual agreement. No further tie-in or capex is required to deliver the gas as Notore’s fertiliser plant is already connected to the Accugas network.

- Notore is a Nigeria-based integrated agro-allied, chemicals and infrastructure company located in the Onne Oil and Gas Free Zone area of Rivers state in southern Nigeria. Notore’s fertiliser facility has a production capacity of 1,500 metric tons per day of urea and 1,000 metric tonnes per day of ammonia.

- Accugas performing well. Accugas total revenues from gas sales have grown at a 15% CAGR over the past five years. Since Savannah acquired the company in 2019, it has now increased the number of gas customer sites from 3 to 10 and raised Accugas’s maximum contractual gas sales volumes by over 50% to 292 mmcfd. These additional volumes will be high margin as they require minimal additional capex and improve the unit costs of Accugas’s underutilised midstream infrastructure. While only expected to have a small impact on estimates initially, it is still encouraging to see Savannah continuing to add new customers within its core Nigerian gas business while also pursuing regional expansion through strategic acquisitions and diversifying into renewables.

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Trek

One director sold stock net from options but still hold over 2m and two more directors bought on open market at 129 and 135!

Pretty good endorsement imo.

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Trek

Well it went to 155 after my post poss lower intra day. I couldn’t add nor have I been able to recently but for those following there is now likely a recovery to 200p on the cards.

If you just factor in a 3p divi being held that’s a decent quarterly return from 170p of 7% or 6% at 200p.

This has normally delivered around 6-6.5% yield so imo the bottom is in based on it being an income play.

Factor in the higher interest rates (helps deposits) and markets holding up and that adds to the SP strength.

Obviously usual macro risks etc apply but this imo is a pretty good entry now for those looking for a boring income with capital and divi growth potential!

I have to wait to top up once some higher risk pays off. As always though timing is everything and I may just miss the last chance at a decent tuckaway price here!

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Trek

TR1 just in for that trade. That’s the first time I have seen it in one big transaction.

Before we haven’t know how far bellow the 5% threshold the transfer has dipped as it was likely lots of smaller trades. Now we know it was a min of 3885000 shares of 69,475,480 (RNS 14th April 22) listed so that’s a min 5.5919% from a holding of 5.761158%.

I think we can assume they have also transferred on the odd remaining % with smaller amounts.

So what I think has been happening is UBS have been buying with their London branch, UBS AB London Branch, in Name, and then moving the stock to their Zurich branch, UBS Group AG, no London Branch in Name. You can see the crosses above 5% are from London and the crosses below 5% are the group!

This enables them to conceal a higher % of disclosure. 3% and 1% for UK and 5% & 10%, 15% etc for non uk.

UBS AG are imo moving the stock on to another account(s)?

I think it was previously only small % at a time just going below the 5% else it would trigger the London end to below 4%. This trade is bigger and may be a result of a previous accumulation or of course they can’t fill out TR1 forms correctly! That wouldn’t be a first!

Look at all the TR1’s, now why would someone go through all that effort??

If there was a bid here it would likely come after the results are out.

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Trek

must be the cashflow to loan against.

Given how the SP has dropped from 140p to 88p since the interims and is actually up from 77p since the last TU and significant appointment. I am backing that Adam will still better guidance based on rework, productivity, covid, and a beat on EarlyCDT lung. We will also get a benefit from fx tailwinds.

The best is still to come from ONC and it is well positioned to be a major player in the pharma services sector.

Conspiracy theories….

1. Being taken over, BNTX my guess!
2. A take over of a smaller company. Look out if you are in the US and have a lab! Depending on size if more than £5m that could obviously mean a placing.
3. Selling EarlyCDT lung
4. 2 & 3 together

The market will soon wake up to the fact that immunoINSIGHTS is a flipping printing machine at 80% profit which following prod improvements is likely higher!

No reason why ONC cannot replicate the Dortmund lab in the US. This could be a substantial growth story!

Worth ticking a few away for the longer term as not many biotechs with mcap actually sell anything!

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Trek

From last trading update..

EarlyCDT lung….

10x price for EarlyCDT lung via Biodesix sales teams. We also know Medicare covers tests, so available to insurance markets. It’s also been added to the Philips lung cancer management platform. You can see on Philips website.

We know Biodesix have recruited extra sales members and are anchored to a minimum vol contract.

The costing structure is also immediately ebitda positive to ONC.

We also have the final screening report due in Q4 from Norfolk & Waveney CCG and should get an NHS adoption RNS soon. Then there is a second pilot due to start in Q4 with iDX lung1 program kicking off in Southampton and Leeds.

It really is on its way to becoming adopted globally. It will be good to get a more detailed feedback on markets in the finals from the likes of North and South America and Asia/China + Europe ex UK. I assume Russia (Trial in Moscow) has come to a halt?

IMO EarlyCDT lung will surprise to the upside.

ImmunoINSIGHTS

From the last TU we know there has been a slowdown in the signing of new contracts. I would, however, assume that there has been enough rework from existing clients. 5 top 10 listed Pharma’s, 13 in total + 4 more immunoINSIGHTS contracts signed since interims, one follow on contract, the covid auto antibody profiling and govt covid work. Plenty to exceed the £6m revenue guidance. So say 6 contracts signed v 11 over first half but we don’t know how much add on work. This would explain the slowdown in signing statement.

From interims ending Nov 21…Admin (was £4.1m) should increase as the Dortmund capex nets out against the extra sales staff in US but they have increased staff in Dortmund as well.

Loss was £4.86m, cash £3m, debt probably £9m if included post period drawdown R&D £0.7m

Gross profit was £1m

£6m revs v £1.43 (H1) will transform the balance sheet even allowing for the extended period!

The forecast was to grow the immunoINSIGHTS share of the pharma services market to 12% by 2023. That’s a $2.3bn market growing at 10% pa!

ONC was guiding a 300% increase in penetration. So even with a sector slowdown there should be more than enough growth to achieve the conservative £6m of revenues. As an approved supplier for many of the top Pharma’s ONC can turnaround contracts quickly. We also have the increase in prod from Dortmund the unit profit/test should therefore increase.

It’s a pity we don’t know how many immunoINSIGHTS tests are performed. We know 200k EarlyCDT lung tests have be done but not the breakdown. We have an extra 2000 NHS tests booked in in Q4. We also have 30% revs sandbagged from last year and the outlook was ….”The organic growth opportunity for ImmunoINSIGHTS over the next three years is estimated to be substantial.”

So I think when Adam has referred to a slow down in signing new contracts it hasn’t significantly affected the overall volumes. If the team are looking for acquisitions then the cash must be there or there mus

That’s how I came to a £1bn mcap with no debt. That also represents a reasonable discount for a 36kboepd company.

Expansion would be funded from existing revenues and any bridge from RCF.

Or a trading range of £5-£6….

Then we have the upside from Royston/Kraken etc…

This company with a good tailwind and a bit of luck will make many patient investors here millionaires with significant dividend incomes to look forward to.

The difficult bit is to do nothing for 3 years!

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Trek

Recognise a few handles here from a way back. I was in here at the end of 16 and sold in the 20’s on a free carry to eventually exit.

If I wasn’t fully invested atm I would buy back in. I read the interims which showed things are turning back around and buyers now can get in near the last placing price.

Not sure what 20p is now after the dilutions but a 15m mcap is v good value imo and this should go much higher over the premium winter months.

Good luck with your investments

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Trek

The spread was put out following the RNS as it’s SETSqx and the MM didn’t know what to do! That way they cover all basis until some orders come in.

IMO Not clear blue water yet financially but sentiment is definitely lifting with buyers looking to take a position below a penny.

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Trek

It’s all v strange here I thought 107 was cheap fair enough but it’s rerating much quicker than I expected.

Looks like the market liked the results. Interesting that PHNX another company I follow (NOT a tip it’s looking toppy now) also has had a good run partly on the basis that it manages inflationary pressures. I just wonder if the market is polarising towards these ‘lower risk’ higher yield stocks.

Well it’s a bout time imo! You don’t have to chase penny stocks to make a good return. That usually has the opposite effect!

With the ATH being broken this strongly and the vols we are seeing + the impending US listing 130-150 is looking more like our new trading range atm.

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Trek

Tested lows three times now, gonna break up from here imo.

MACD and CCI bullish. Will get MA crossovers at 20p. 20p resistance once breaks will imo send us up.

Most importantly more likely to go up than down now and smart money will be in early to time ops and end of year anticipated sP run.

I see 25p fairly soon which is below a lot of averages here but a good return from 19p. Will go much higher on news of course.

Well that’s my kiss of death!

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Trek

I am pleased well surprised they have increased their targets against a market that was not convinced they’d get there next year…

“ Output from the underground mine and the open pit are planned to steadily increase of the next six months with mining and processing capacity planned to reach the targeted rate of 24,000oz pa by year-end.”

Pretty impressive from a lay persons perspective

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Trek

If as many suspect the flavour of investor concerns polarises towards how insurers manage inflationary pressures and the delta between inflows and outflows then on that basis these are stellar results!

“ Phoenix has no material exposure to inflation, with our key product and cost exposures hedged.”

“ · Investment in our Workplace business has delivered clear momentum with net inflows of £1.7bn in H1 2022 (H1 2021: £0.2bn net outflow), with 42 new schemes won in the first half, compared to 16 in H1 2021.”

And of course the divi policy is restated which we already knew.

I am going to continue to hold these and may add on any future Sp weakness

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Trek

Hi longfell,

Good to have a different view. Irrespective of who is right or wrong. Therein lies an issue of further investor confusion or obfuscation depending on one’s view.

From RNS….

“ · A structure deliberately designed to support COPL and senior lenders with the implementation of an RBL agreement.”

So rather than debate. Let’s just say take away the RS report which obviously helps the RBL that investors, self included, thought was pivotal. So make it vanish!

Now revisit your entitled pov.

“ Trek - the report has no bearing on the RBL.”

I emphasis your word ‘NO’ and the subsequent sp response.

You see imo many investors fall into a bull or bear trap. They vehemently argue one camp or another. Fine. Few are dynamic with their interpretation of data especially as it changes. Fine also.

It makes a market.

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Trek

More good balanced views isthisawinner,

My concern with the RS report is if it is too complex then that may dilute the leverage it has to get the best RBL terms. Bankers from my experience like simple. However, I think that is likely mitigated by the institutional unsecured investment. They, bankers, also like to see shared risks as well as y leveraged assets!

There’s always ops challenges but at the end of the day they usually get resolved. I am more worried about supply side than wax because of time. Get the right equipment and set up and with todays tech I don’t see anything thus far operationally commented on as insurmountable.

Resolve a few of the unknowns which just takes a little time and all will look completely different here.

Let’s just hope Art is confident of delivering the RBL within the timeline he signed up to.

That is what will imo defer further dilution. As time ticks along the 90 days so investors will become more nervous.

I reckon he has a rabbit but at this juncture I would rather just wait to see what it is unless of course the SP gets even ‘sillier’, using the comparative that is.

Good luck with your investments

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Trek

A positive on the energy outlook in Germany with having LNG plants on by end of year.

I posted on Tecan but actually this vid is probably worth a listen. The macro guy is very good…

https://youtu.be/vzvR958CYTw

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Trek

Hi mick,

Yes I clocked that, German power security. I have a position in ONC. They have a major lab in Germany with clean rooms and fridges + robotics etc. I would assume they’d have standby gens but any prolonged interruption wouldn’t be helpful.

I expect a few other investors may feel the same. I note he expects $80, not sure if Brent or WTI but I would assume WTI; that imo is actually pretty positive from my investment standpoint.

I also like that he comments on the poor netbacks in Russia which are getting even poorer due to sanctions. So whilst the headline numbers in terms of oil sales look good they are too inefficient to max the return.

There were lots of snippets in there to read across…

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Trek

Russia have resolved these issues. They deleted the spreadsheet!

This guy Prof Geoffrey Sonnenfeld, from Yale is imo one of the best macro guys. Worth hearing him out.

China’s imports to Russia down 50%. There’s a number!

Very interesting on oil around 12 mins

https://youtu.be/vzvR958CYTw

Usually caveats

Trek

Hi Notmyjob,

They have already made their policy clear in the 4th Aug 22 RNS……

“ Proposed dividend increase

The value and cash flow generated through this acquisition support a sustainable 2.5% inorganic increase in the Group's dividend, to take effect from and including the 2022 Final Dividend, subject to completion. This demonstrates the significant value to shareholders of smaller, cash funded M&A.

Ahead of the Full Year results, the Board will assess if organic business growth delivered over the year can fund a further sustainable dividend increase for 2022.

In future years, we intend to simplify our dividend communications by announcing any dividend increase at the time of our Full Year results, which will combine both organic and inorganic growth, rather than providing separate dividend guidance on announcement of future M&A.”

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Trek

Won’t happen until after elections imo, that’s a known unknown. Why would you list until there is political stability if you don’t have to? I think at least a couple of weeks yet.

“ As of 2100 GMT, Reuters had tallied 241 forms, which showed Ruto in the lead with nearly 52.3% of the vote, compared to 47% for Odinga. Two other candidates had less than 1% between them.

Thirty other forms could not be included in the count because they were unreadable or were missing information such as signatures, constituency names, or totals.

The forms Reuters is tallying are preliminary and the results subject to change. After the forms are uploaded to the commission's website, Kenyan election law requires that they are physically brought to the national tallying center, where party representatives can examine them for any discrepancies.

The process was designed as a safeguard against the kind of rigging allegations that have triggered violence after previous polls. More than 1,200 people were killed after a disputed 2007 election and more than 100 killed after a disputed 2017 election.

The winning candidate must receive 50% of the national vote plus one, and at least 25% of the vote from 24 of 47 counties.

Reuters was not able to ascertain the official tally at 2100 in the national tallying center as the screens were displaying other information.

The commission has until Tuesday to declare a winner.”

https://www.marketscreener.com/quote/stock/VIBRANT-GROUP-LIMITED-6811933/news/Veteran-opposition-leader-Odinga-ahead-in-Kenya-s-presidential-race-official-results-41301994/

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Trek