Member Info for Valuation-it-is

FlyingHorse1
No wish to be rude, but I think you are wrong about hedge funds and shorting. The market serves a really good purpose - that is to provide capital to companies that are attractive to investors through the price mechanism. It means that investments/companies with little appeal go down in price and it is more difficult/impossible for them to raise funding.
Hedge funds assist this purpose. They do exactly the same as PIs in that they invest in promising companies but they go short of ones that are duff. This increases liquidity in the market and helps it find the right price quicker. Hedge fundshelp the market mechanism work well. It means you are likely to pay less for a duff company - and therefore lose less when it goes wrong. It also means duff companies go bust, but that is the market for you - if you are inefficient or cannot compete, you fail and employees,assets etc go off to do something more worthwhile. If this didn't happen there would be no change, no advancement. Tough yes, but its how the economy works, and the quicker and more efficiently it works, the better.
Where I might agree with you is on uncovered shorting, where there is a risk of not being able to complete the transaction.
The brightest brains tend to work for hedge funds. Take a look at Kwasi Kwarteng 's cv. They do an immense amount of work prior to buying or selling, so really are a good force in the pricing mechanism. They keep BoDs on their toes and some really need that.

Flying Horse
Please explain why covered shorting is immoral..........

https://www.hydrogenfuelnews.com/fuel-cell-vehicle-parts/8542819/?mc_cid=60a1812405&mc_eid=f060cd91ec
We know where they could re-fuel...........

Dr A 13.55 Many thanks for the helpful reply.
Re " In regards to the SGH2 - I may be wrong but their feedstock is paper, not plastic?"
I think you are right for the Lancaster (US) plant, that the feedstock is expected to be paper.
However in the article, below the heading "The commissioning of the project is scheduled in the final quarter of 2022" is a quote from the Lancaster mayor, R. Rex Parris who says...
"“It also solves our plastics and waste problems by turning them into green hydrogen, and does it cleaner and at costs far lower than any other green hydrogen producer.”"

It was that quote that made me think the SGH2 unit would be dealing with plastic waste.
For PHE to be a potential multi billion mkt cap company I suspect it will have to be sure of going global with its DMG, and probably to do that it will need to have an exclusive process. It was that quote that made me think that perhaps exclusivity is not in the bag........ And if it is in the bag, i.e. covered by patents, then it looks as if PHE may to have pay to enforce its IP, not a pleasant thing to have to do in the US.
One other thing. You are a calm, polite, well informed and considerate poster. If you think my posts are detrimental to PHE I am quite happy not to post. But I think that positive and negative items should be discussed as it helps price discovery and avoids some nasty and costly surprises

DR A 8.20am

If they have not already done so, do we know when Peel are going to pay £500k for the exclusive use of DMG in the UK?
With what I thought I knew, this seemed like a very low figure to pay for an exclusive licence in the UK. I wonder why Peel have not already made the payment? I also wonder why Peel did not wish to fund and own the whole of the first DMG and do it as fast as possible?
I think the cost of building a DMG unit may have risen. Also, the revenue streams that I thought were not exclusive, perhaps are so, i.e. that DMG can make hydrogen (2tonnes per day) or electricity or heat or a mix, bit not 2 tonnes of hydrogen AND electricity AND heat.
Whilst demand for hydrogen is forecast to rise very sharply, it looks as if the selling price of hydrogen will have to be similar to H2 produced from gas reformation, unless the Government gives H2 from gasification a tax break or incentive etc. You can see what that means for revenues elsewhere.
I was also struck by the comments under the SGH2 article that another poster gave us a link to,
https://www.nsenergybusiness.com/news/sgh2-green-hydrogen-project/
which read
"“It also solves our plastics and waste problems by turning them into green hydrogen, and does it cleaner and at costs far lower than any other green hydrogen producer.”"
It appears there is at least one other operator providing the same sort of equipment and service at even bigger scale with associated economies. The extent of PHE's patents is unknown to me, but my understanding has been that PHE did not want to apply for patents because in doing so it would have to publish valuable IP for others to see. My conclusion is we will have to be very wary of thinking PHE has an exclusive business.

aandi 22.35
I hope you are right. Acid test is - would you pay £145 for a tub of biochar? It may be good fertiliser, but £145? Perhaps the decimal point is in the wrong place? £14.50 perhaps. Makes me look at the ash from my woodburner in a new light!

Jmc_mcr 17.42
If he has been at it again, just ignore him. I put him on filter out and life has been very pleasant as a result. If you look through his posts, you will find he does not add value and will only tolerate positive ramping comment. When warnings are needed he would rather do without them. When info does not suit his agenda he becomes abusive. This board does not belong to him despite what he may think.

SGH2 states on its website.....
"COST COMPARISON
Our greener than green hydrogen is 5 to 7 times cheaper than green hydrogen (produced through electrolysis with renewable power) and is cost-competitive with the dirtiest hydrogen.
Our production costs (based on current US costs) are projected to be US$2 per kg of green hydrogen. Brown hydrogen produced from cheap coal in India costs US$2 per kg."

We are beginning to see that gasification can produce hydrogen very competitively. Watch out those who crack fuelstock to produce hydrogen, the gasifiers are coming your way.

It sounds as if SGH2 is not going to own/finance the project:-
"Under a recently signed a memorandum of understanding (MoU), the City of Lancaster will host and co-own the project."
".. ......to produce up to 11,000 kilograms (24,251 pounds) of green hydrogen per day and 3.8 million kilograms annually."
That is 5.5 times the output of a DMG unit but the cost is 2.7 times. Economies of scale.
I wonder what plans PHE/Peel have to increase the size of DMG?

Global Gasifier Market Companies

Vulcan Gasifier, Dakota Gasification Company, Gasifier Manufacturing, LLC, PRM Energy Systems, Inc., Phoenix BioEnergy LLC, Borgford BioEnergy LLC, Aries Clean Energy, and Enginuity Energy LLC are expected to dominate the global gasifier market as major players. Other firms that are anticipated to make a mark with the gasification technology include Zeropoint, GE Energy, GASEK, Gasification Technologies Ltd., Plasma Gasification, Taiyuan Coal Gasification, and Nexterra.

https://eandt.theiet.org/content/articles/2021/01/future-fuels-change-the-balance-of-power/

"Germany is ahead of most other countries with its plans for sustainable fuel for aviation. The home of the Fischer-Tropsch reaction sees a future where even biological sources of carbon for kerosene barely feature on the fuel menu. As part of the nation’s strategy for an economy built around hydrogen and so-called power-to-x (PtX) technologies that use electricity to help synthesise a wide range of chemicals and materials, the environment ministry published a draft bill in September 2020 that guaranteed a minimum quota for electricity-based aviation fuels."

I know its a bit dated but worth reminding ourselves.........
https://www.fundslibrary.co.uk/FundsLibrary.DataRetrieval/Documents.aspx/?type=sl.ra.interim&id=eb7e9fdf-97db-4494-8ccd-00c041253b9b&user=ju4Nq%2fSHSsurUed%2fvdR3B5oD2QZg7a%2bJYOYhijaBElELEumQHr969lkkIL2RCn%2f7&r=1
Take a look under "Operational, Commercial and Corporate Highlights" and "Post period Highlights"

There is a difference between the placing announcement date, and the date the shares can be traded on the market. But you are right anyway.

Agreed. Germans might do better in their buying of PHE to avoid buying on German markets after the London close and to wait for the London opening. It often seems to be the case the German markets roar away after London's close only to be filled in by London in the Morning.

https://www.hydrogenfuelnews.com/green-hydrogen-plants/8542745/?mc_cid=ae1c46d3a3&mc_eid=f060cd91ec

The announcement states:-
21 January 2021

Powerhouse Energy Group plc (AIM: PHE), the UK technology company commercialising hydrogen production from waste plastic, announces that the Company is issuing 4,895,260 ordinary shares of 0.5p each in the Company (“Ordinary Shares”) further to the exercise of warrants at 2.5p per Ordinary Share.

Application has been made for the admission of 4,895,260 Ordinary Shares to trading on AIM (“Admission”) and it is expected that this will occur on or around 26 January 2021. These shares will rank pari passu in all respects with the Company's existing issued Ordinary Shares.

Subsequent to the issue of Ordinary Shares, the Company will have 3,901,814,135 Ordinary Shares in issue. Powerhouse has no shares in Treasury, therefore this figure may be used by shareholders, from Admission, as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules. (end of message)
Source :- https://polaris.brighterir.com/public/powerhouse_energy/news/rns/story/rmqq59w
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I think Peel's warrants were exercisable at 2.75p so it does not look as if it is theirs. This is a further addition to shares traded on Aim as the recent placing shares were due to start trading today, and these start trading "on or around 26 January 2021".
The market cap (assuming 9p/share is therefore £351m . The fully diluted number of shares will be higher because of options/ warrants, but the statement did not say how many more shares there would be on full dilution.

Re Steevo38uk 23.32
Thx for wishes of good luck. I agree the dilution in this case is not bad, as although the discount was large the number of shares issued was not that great) It is the principle which is set for the future, and trust in the board which is important.
I am looking for what Peel will bring to the table. They have a very attractive option to buy 10% of the company (PHE) at 2.75p per share, so I am hoping they will be adding value for all concerned soon. I am not sure how "tied down" the arrangements are.. GL

Steevo38uk 20.38
So to make sure we are comparing apples with apples..........
What would have been your reaction if you had just bought at 3p in the market 6 weeks ago, and the company then issues shares to others, excluding you, at 2p a share? ( The same 33% discount) Then what would you have thought if the directors you are relying on to look after your interests had been responsible for setting/agreeing the share price of the issue?
Then what would you have thought if you found the directors had bought shares at 2p when you had had to pay 3?
It is yet to be seen what the directors actually did do in the placing - They may have bought none themselves so as to be seen not to be taking personal advantage at the expense of their shareholders. We will see.

Markrops 13.59 FYI
https://uk.finance.yahoo.com/news/powerhouse-energy-group-plc-5m-061600463.html

I agree with you about focus on the potential. We must watch out though, for how the benefit of the UK potential is divided up, firstly between Peel and PHE and secondly, amongst PHE shareholders.
I will be more relaxed when Peel are fully signed up, have bought 10% of PHE (at 2.75p per share) and have put some serious money into the operation. Until then, the promise that PHE has abroad is encouraging.