Member Info for TrekMadone

I haven’t revisited my research here for a long time. Have had to spend my efforts elsewhere as this is ticking along nicely. The obvious risk was always cash. The two placings took care of that. However, the contract(s) cash flow is back ended.

There was £14.7m on the books halfway but you have to factor in £17.9m came from placings including costs, they probably landed around £16.

The business is/was still running at a loss of £4.7m, that’s basically marking time on a yoy basis. The £10m from cost sayings are not in the bag they are loaded to the second half as are the revenues. A successful vax say from AZN could trounce some of those deals. There will be get out clauses.

The SP climb is predicated on cost cutting coming through, contract execution and disposals. In terms of risks one has to ask how much is in the SP. Is it frothy as following the raise there is still not (yet) an equivalent ROI.

I haven’t reviewed the credit facilities but I would expect OO to be revolving some debt until disposal or FCF is reached.

You see that’s the play it’s very much back ended. People that have got in in the teens have headroom. Those buying now need to factor in the likelihood of execution and if the ebit number will be truly transformed to a level that cash can be thrown off.

I think it will but I could make a case either way and in any event we have no idea what the sale will land. There’s our view and a market view. The market will price it.

Another risk is CF himself. I get he has put succession in place but OO like many small caps is overtly dependent on one person. Imo his bravado about taking part in the challenge study at his age could have been pretty wreckless! I am glad common sense prevailed.

Ivy,

I take it you mean MTFB, indeed all the data pointed to the stars. Even more so than it did at IMM. I also have a few scars from both but learnt an awful lot, the hard way.

Consequently I didn’t ride the lot for the read out on DDDD and exited with an amazing profit. I can now pick when I want to re-enter which will be after the raise or 78p, whichever comes first and even after all my research (I was one of the few posters there back in May) I am prepared to let it go. Likewise over at SNG and TXP I have taken out nearly 300% and left in a much much more than my original stakes.

My point is it can be done but you gotta DYOR, ignore the rampers, the ‘confirmation bias’ and look at the finances, the potential and the cos and adjust you position as data evolves and protect capital at all costs.

All said I think 20p here is outstanding value, 30p ok beyond that I would like more data to understand just how much FCF will be generated and what in currency we can expect from the disposal. There will be differing views, as we don’t know. Like you I agree it’s good to discuss them.

I know some peeps don’t like charts but I think the TA will soon give a good indication of fair value here.

Usual caveats,

Trek

I have also been here since 6p. Fully understand those taking profits if cash is needed. For those concerned about buying back in at a higher price having sold before, it matters not. It’s what you sell for that matters and one has to pay more for the progress made.

Some investors struggle with the concept of paying 30p for something they sold for 20p and hope or expect to get their original price back and yet their research is telling them to buy!

This company consistently achieves milestones, they are accretive, adding value to the business over time. For that reason the risks are lower, hence you don’t necessarily need to de-risk; you can see, feel, and virtually touch what’s in the bag. That has monetary value.

It may not be a good comparison but If you compare to say SNG or DDDD, there you have seen the SP run away, for their own reasons, but the objectives are not banked. It may be a better strategy there to take profits and even re-invest those profits on the dips.

Another biotech services company, where I have a similar view to ORPH is ONC. It likewise is banking contracts and achieving milestones along the way with much much bigger prizes ahead of it.

On a macro basis, Pharma/Biotech/Services, Junior Gold miners and niche technology is still the place to be and they are very interesting sectors to research.

It’s just that no one asks me anything I know at the pub quiz!!

Trek

If it adds up to a TCF which they may think it’s getting close to you wouldn’t want anyone to know you had a royal flush until the last play.

Trek

Hi Dave,

Indeed I ran this one from 11p-16p buys to over 150 before selling on the way back down. I remember buying the seller then, Miton.

Also got in recently at 28p and sold the lot at 57p. Been waiting for sub 40 having missed the last pull back but caught this one!

Typically I got the TR1 after hours just after I bought else I’d have waited. Still we don’t know if Lanstead is still selling. There will be a few TA clues next week. Anyone buying I’d hold off a tad. 28p May surface again but I wouldn’t sell and hope to buy cheaper If was in, just wait.

That’s the attraction here if you time it wrong there are a lot worse places to be stuck!

Trek

Indeed it is. I have added a few here to tuck away. Never expected to get back in at this level. Testing will be sorted then there will be a huge Keynesian economic recovery spend to address unemployment and they will want to us the new tech that the likes of VRS offer.

The darkest hour is the hour before dawn.

Trek

Hi CD,

I posted a summary here on 19th sept that may be useful and some info on GRL (20m mcap) on 12th sept that may help. Also added a view on CCZ today (30m).

I will look at GLR, it’s actually on my list but I haven’t gone there yet. I note the decent rise today there as well!

Must stress I am only a retired armchair investor though. Not an expert. Like you I get the feeling as the covid plays are running their course Mr Market is blowing a junior miner bubble.

We all get gold for defensive qualities but I would also add in copper for the upcoming electrification and Keynesian spend that we are imo inevitably about to see!

Usual caveats,

Trek

Hi Eva,

Following my post 22:26 Tuesday...

COBR getting noticed and SGZ has broken the down trend both now ticking up. CCZ up 25% today! And SNG as you will know came to the market. Not a bad call!

Meanwhile TSG continues to provide ‘easy’ trading money but ONC has succumbed to profit taking. There may be a raise at ONC at some point but that one is a Q1 hold for me then offload into the major news there when it arrives; albeit I have added more on the dip!

SHG is still marking time which is ideal but once that seller clears there could be a big step up!

Trek

Not surprised to see this rise here. There’s not the volume to justify it, again it’s more liquidity rated. Still not getting sellers though. I doubled up at 2.7 first thing. Simple really, RNS Monday should be the catalyst to get this noticed, buys now will then have some headroom thereafter imo.

Drilling The Big One is very exciting, it’s shallow 28.4% copper, pretty much nailed on from samples I’d say. The objective here is to financially derisk Arya through The Big One and eventually develop Arya.

Arya is made up of two huge geophysical sulphide anomalies modelled at 130m thick and 1,500m by 450m but at a depth of 426m albeit there are shallower sections.

Whilst the BoD have ambitions to become a mid tier producer I think this is gonna be a prove up, value up, JV or sell campaign.

We have 4 shots on goal at IOCG targets within MT Oxide acreage (Arya is one). If Arya does come in it will be a massive capex project! I would expect to drill the others and develop The BigOne while attracting interest.

There are a lot of Blue chip miners around our postcode. Things could get very interesting indeed. As for CCZ to go it alone with Arya.... no chance!

These drill results will be being watched!

Usual caveats,

Trek

Paraytech or iAbra’s Virolens test which are light based using saliva are imo better options.

Paraytech is accessible via BRH, an investment company, see today’s RNS (I don’t hold) or

iAbra test which is ready for FDA approval is investable via TTG, the manufacturer, I do hold after the recent drop and posted an email from the Co on that BB.

Don’t confuse any of the other tests though with mass population screening. There is a place for most tests.

E.g.

UK plc could posts every household in Liverpool a home test to end lockdown. They could use targeted testing while manufacturing is upscaled.

A theatre may be able to open if it uses has a rapid light based saliva machine based test at each entrance. Get the gist of options.

Usual caveats

Trek

Here’s another from Paraytech....

But remember we are in the process of FDA approval and have manufacturing scale in place...

https://mobile.twitter.com/carlsmythe/status/1313042549548953602/photo/1
(From Trajan)

BRH is an investment Co, been on my/watchlist since 18p! Typical!

https://www.lse.co.uk/rns/BRH/further-update-re-paraytec-limited-qegn50cwvibakh6.html

Trek

Thanks for posting Johnathansxx,

I guess it’s further validation of principles.

Trek

Gosh we’ve just had two stonking back to back RNS’s! Finals are due 31st Oct. May be a slight covid delay, can be up to two months but I think we’ll be ok.

Only shows numbers to June but we’ll get guidance and then interims,

No raise b6 mid Nov and that’s a sign of self financing.

Look at the BBC news. Long covid, treatments, vax matching, second wave. ONC are going to be the covid diagnostics gateway. That’s before all the other news

I have some cash aside, well can sell elsewhere if it goes 150’s or else it goes in anyway after finals. There aren’t many companies that offer upside in this climate.

Trek

Below is the tech on late trades. A sad bloke I am I read the LSE rule book to try and work it out. The explanations are referenced.

Remember it’s the aggressors trade only that is published so the buy or the sell. It’s just a trade which is why the London SE site only publish a trade.

Here the algorithm try’s to gauge if it’s a buy or sell but there it can run 15mins late so the mid point can change by then so you get errors...

# The published trades here can be 15mins late.
# If the spread is wide, there is no way of knowing what side of the mid point the trade was.
# If a sp falls quickly sells will look like buys as by the time the algorithm runs it puts a sell above the mid point and shows it as a buy.
# If a sp rises quickly a buy will look like a sell as by the time the algorithm runs it will be below the mid point so the buy looks like a sell.

# Furthermore with a wide spread you may find some MM’s are so far apart from the mid point so how do you know if it’s a buy or sell.?

# If you use interactive investor you may get a prompt, we have improved your order by £162 so your buy may look like a sell when published as there was one MM with a better book.

# or the stock may be illiquid and there is only 1 MM with the min so they push the spread out, I have seen 40% spreads on AIM, to deter trades. See volume and liquidity are key to gauging value.

So basically just use some TA. If the sp is rising over time like here then the balance of trades are buys or the share is in demand.

Usual caveats

Trek

Late trades...sections g3013 and g3020 key. Nothing sinister and MiFID compliant...

In relation to rule 3012, where two member firms agree at or prior to the time of the trade, the responsibility for trade reporting may be delegated to the other member firm.

The rule recognises that member firms may wish to delegate the trade reporting responsibility to the other member firm. This may arise where a member firm trades infrequently and hence wishes to always delegate the reporting process or where the non reporting member firm wishes to gain protection under the deferred publication facility but the reporting member firm does not.
(Amended N09/17 – effective 3 January 2018)
Standard trade report deadlines [3020-3021]

Where a trade is executed during the trade reporting period, a trade report shall be submitted to the trading system in accordance with the standard trade report deadline.

Guidance to Rule:
The trading system will immediately publish a trade report unless deferred
publication is requested (and the trade qualifies for a delay). (Amended N09/17 – effective 3 January 2018)

And these are the addressable concerns

A member firm shall not:
aggregate trades in order to qualify for treatment under the deferred publication facility; add subsequent trades to a deferred publication in order to increase its size; or
submit or agree to submit a correction for the sole purpose of re-reporting a trade in order to gain or extend a delay in publication.

Less technical explanation.....from FAQ’s

When can the deferred publication regime be used?

A member firm should only request deferred publication where the member firm is dealing on its own account (as principal) and the transaction is between the member firm and its customer.

How can I request deferred publication of a trade?

A member firm may request deferred publication of a trade by submitting a trade report with either the ‘OK’ (for an ordinary trade) or ‘NK’ (for a negotiated trade) trade type. MillenniumIT will determine whether a delay should be applied based on the relevant publication regime.

References..

LSE Handbook
https://www.londonstockexchange.com/traders-and-brokers/rules-regulations/rules-lse.pdf

FAQ’s
https://www.londonstockexchange.com/traders-and-brokers/membership/faqs/rulebook-faq/rulebook-faqs.htm

Trade flags/types
https://www.londonstockexchange.com/prices-and-markets/prices-help/trade-type.htm

Trek

SP just moving up and down In spread. I just picked up a few here at 2.62. Just something to build from. Spread is ridiculous, it’s to deter trading, however, I guess it’s what you sell for that matters. Also if peeps keep buying with this spread the MM will have to try and get some sells for liquidity. They’re may be some wild swings here later!

Trek

I agree, it’s a pretty unique situation this. Bar Coho I have de-risked before the drills. Now the results are as near as in and there is extremely high levels of certainty not only has the SP not really appreciated for the results it’s not even factored in the potential revenues. Instead the sp drifts.

TXP really is an amazing opportunity with relatively little risk to the upside here, bar of course Royston. Yet the market doesn’t value us. We even have a local market for the gas!

Whilst I don’t want a takeover, I rather we grew and paid dividends, this is just the sort of scenario that unfortunately attracts a bid. A mcap of 200m is a joke. It’s less than a major would spend on even 1 discovery!

Arguably the case for buying now is more compelling than it ever has been!

Trek

Welcome CD and Eva,

Good luck with your investments. You will find DTM a very knowledgeable and helpful poster.

Re UFO, it came up on my spreadsheet filter about 2months back and I discounted it because I felt the projects were too dispersed and it needed cash pretty quickly. Then they dipped and I didn’t have cash! Now look at it!

Still I have applied the same principles here and the drill is on!

Here is a list of all FTSE stocks by mcap. It gets auto-updated for those digging around, apologies to those who saw it on SHG.

http://www.stockchallenge.co.uk/ftse.php

ATB

Trek

Hi Bilko,

Not at all. I have done extremely well out of Pharma. Started at the beginning of the year with a modest investment and now it’s been pretty remarkable. Got so many free carries as I have tried to hedge my risks along the way. 4D, AVCT, SNG, ORPH all freebies now and GGP in Au; everyone’s got GGP though!

Actually I sold all 4D recently and put it into ONC and TTG. Will be back at DDDD when either they raise or my price entry is reached, which ever is soon. The raise may be higher than my target but it don’t matter. It’s what you then sell for that counts.

In O&G my biggest win was TXP, that gave me a significant profit of near 300% plus a free carry which is now 550% up as of today! An amount I’ve only ever seen when house buying, quite remarkable.

I guess it’s all been a bit of a lockdown irony as prior to covid other than a few AIM stocks I just held a few blue chips. I sold the bluies, had too and needed to recoup covid losses on our modest pot. I then looked for ways to benefit from covid when they built that hospital in Wuhan in January/February.

I thought imagine if the government built a 1000 bed hospital in the centre of Hyde Park and closed off a city bigger than Manchester and told everyone not to worry? Mmmm. I didn’t believe a word of the bull we were being fed. The first company I bought was NCYT, sold em a while ago. Had some other winners and some losers which went up after I sold them too early! Lol!

Been taking slices off now though and buying some value stocks back. Target now is to help the kids a bit.

CD. You are right to some extent with GRL, I have posted some financial analysis over there. The key is the EP for now. That will offer a de-risking opportunity. Then first pour. By then around 1/3 will be left. The grades are outstanding.

I only offloaded here as I don’t see a big step up just yet. Plenty of time to pick another target and then be back. Leaving a foot in the door helps keep ones average down when buying back in. I’m still very bullish on SHG just gotta work what we got hard. Now watch it do +5p!

Atb

Trek

I am not surprised at the placing. It was either a deal or a placing. Companies come to AIM to raise money, I don’t know why some folk are surprised when they do just that!

I am surprised by the size of the placing, 87m wow! but glad they have gone big. I think the strike price is very respectable at 175. The 4% VWAP is a complete misnomer. It just shows how aim shares are easily manipulated and explains the dip recovery recently.

I am, however, glad I took more off at 222. Make no bones about it this will tank short term. I am sure the PI’s moaning they can’t get ‘mates rates’ will have an opportunity to top up at around or even below the placing price.

Watch the shorts now as the market has few friends and insti’s will be expecting their brokers to milk this from arms length!

As for will it succeed. It’s already done, these matters are resolved before they are announced there is no other way given it’s not underwritten. We’ll get an RNS at around 5pm tomorrow saying it’s done.

I do get vexed at the need for two tranches and the conditional placing shares being vote dependent. It’s intended as a safeguard for insti's but it just introduces a level of virtual uncertainty that is played by the market.

Anyways it’s gonna be a bumpy ride for a few weeks. This team have worked their socks off to get a global P3 trial off!

I am hoping it’s a double bluff to prove to whoever’s was ‘dancing around our handbag’ that we are capable of finding our own way home but I hope we now find a suitor!

Anyways amongst this bitter sweet reflection given the stonking results of P2. The money UK plc has thrown away on the lack of a cohesive covid plan or treatment strategy. To assign £100bn to moonshot and not find £100m to fund a treatment P3 live trial is incompetence at its highest level! Completely reprehensible!

It’s like they have been using patients as pawns whilst awarding contracts to cronies! It’s been nothing short of criminal!!

However, I have always intended to let the rest ride here. Given the risks taken, the success thus far and that patient care has always been central to this team I wish them every success. They and the shareholders that back them deserve every penny they get! This has not been easy!

All the usual caveats and the odd allegedly!

Atb

Trek

Yes I also remember tipping it here ahead of the Coho1 drill at around 15p. It has and still is below the radar very much like SAVE. Gives us all a lot of confidence in Zen’s numbers.

Seem to remember AK saying they ‘hope’ to add 1 or 2 new customers by Christmas. That would defo be the catalyst we need. Even with volumes ticking up we are stuck below 10.6 resistancefor now.

‘The darkest hour is the hour before dawn’ and after all this time it feels like that here!!

Ps BPC (it’s been plugged everywhere) I have been in and out since 2001 but it seems like the drill is on now, spud this year. Imo a trade, don’t let it all ride for the results though!

Trek