We would love to hear your thoughts about our site and services, please take our survey here.
Partridge, I would hope rhat the cashburn has dropped anit. The expenses related to MfDevCo have disappered, maintenance of an office has hopefully reduced.
Staffing costs have hopefully reduced a bit with mintys etc gone. But of course a good chunk of that will be swallowed by the C4 chaps.
The interims are due soon. They may give some mi or indication, but it will be tricky since for the majority of the period they cover it was the "old regime". And there are doubtless certain associated cost associated with the changeover.
Barry, you look in the accounts. In this case specifically note 6 on page 39.
The Uk tax losses don't expire. If they did they would be restating annually.
The canadian tax losses do expire. These are detailed in the accounts. Obviously they will go anyway if eoi is divested.
There are restrictions as to how much and when and against what things may be used under the carry back and carry forward rules. Like all things tax HMRC may do compliance checks.
Uk reclaimable losses were 8.8866m.
Canadian 1.830 starting to expire from 2026.
Fair comment. But the fact there is that they were claiming it was within the rules. In many cases it wasn't. (On the subject of parliamentary expenses there is even - or an least to be - a seperate supplementary page for ones tax return. It is, to me, more than little unethical that the "wholly neccesarily and exclusively" for job related expenses don't apply in the same way for MPs).
I am not saying that these holders are within the rules. Merely that I expect they are. That neither makes me right nor their behaviour ethical.
Blutonyblu,
It is a bit counter intuitive isn't it. :-) But those are the rules.
If it were the case that mere posession of information barred then it means no director, employee, adviser etc could ever deal. (I was always in posession of inside info as an employee. Of my employer and their clients. The same would be true of most employees. The question is how price sensitive it is).
For the exemption to apply you would need to demonstrate that you would have taken the same action had you not been in possession of the information. An example could be something like selling to fund a house purchase.
It would be much more difficult had one made a purchase.
I am not saying there is no issue. Merely that any issue isnt is specific to nuog. It seems unlikely to me that these people (however much one may find it distateful) have almost certainly acted within the disclosure framework - or at least near enough to avoid censure in any ensuing investigation.
You may take a view that nobody in any companys brokers should be allowed to trade in the companys securities in any circumstances. Many may share that view.
However the fact remains that there is a regulatory regime, enshrined in law, that does allow it.
The law does allow trading whilst in posession of inside information (and whether you like it or not nobody can say with any certainy what information the individual was in possession of - if any). What the law does not allow is trading as a result of that information.
Partridge,
You do raise valid points. It seems to me self evident that a broker, or any other adviser for that matter, cannot function without being party to sensitive regulations.
That is why there are reams of regulations about how information may be disseminated, how it is recorded and when people who may be in possession of that information may deal and whether regulator clearance may be required. Who can give that clearance and how ot is documented.
Is it perfect, I doubt it. But it is fairly robust.
The FCA do a lot of random checks, they also look for strange activity. Particularly on senior personnel.
Piper,
It doesn't actually really matter in many ways. What does matter is that real commercial reasons can be shown, otherwise the transactions can (potentially) be ignored by HMRC for tax purposes (ie HMRC may take a purposive view).
It doesn't have to be anything in the O and G arena. It could be anything.
It is worth reading rule 14. Listing gets cancelled and then have to readmit, but it doesn't have to involve any form of takeover (though it often does).
Typos even worse than normal. :-)
When one considers RTO often one thinks of change of equity, issuance of new equity and major shareholders. That stemp from the Takeover words.
However, with AIM rules (frankly a bit bizarre) that is not really what an RTO means. Any substantial transaction in comparison to existing assets is an RTO. There are standard ratios in the form of class tests.
(eg if my AIM co had been sucessfully running a pub and used its cash reserves to buy a few more then that woukd likely be an RTO).
Dickbat,
Yes, that is an alternative and potentially occurring scenario. That which I outlined below (i.e. paying for an incoming asset via equity finance) gives, in effect, an instant boost to corporate value. However on a diluted basis - it give little (but not none) capacity for further improvement. Howe er that does still lead to a decent potential improvement.
However, if the assetcpuld be bought for debt - non convertible or at least converted at a much higher price - then a different scenario applies.
There will be little uplift in nav (the debt wipes it out). This will impact the ability to utilise the tax losses (the debt repayments willreduce any taxable profits).
However that's fine. What profits that do occur are accruing solely to the existing equity base. This gives much greater opportunities over time.
I imagine that the final deal, if/when, is likely to be some mixture of both equity and debt. My mind is open to both.
What won't happen is a valuable asset gets magically reversed in at zero cost.
It is also correct to say that some assets close to decomm are "going begging on the cheap". Though that is kind of full circle back to the marginal initiative so does feel unlikely.
I think more recent holders will be less worried about how an acquisition is financed, however longer term holders would probably prefer a more debt biased solution.
I mst admit that I have never been convinced by the "back ot into an exiting co" is more efficient or cheaper etc.
There are two elements to this. The cost of a listkng is comoaratively cheap. It is the cost of listing particulars - or rather the corporate advice that produces them - that costs the money.
In general those costs are broadly equal since the RTO target will have to produce an admission document and various stuff. But there is likely to be a modest saving.
So for RTOs the motivation has to be something in the structure (in this case tax losses). But as I shall now show ots not that simple. Reversing in a 40m asset doesn't necessarily accrue 40m (or indeed any) value to the existing holders.
If I have a 40m asset then I do an IPO. I maybe enlarge or restrhcture the corporate equity, keeping 75% of it and selling the remaining 25% for 10m. The 10m does the development and I pesonally - as the previous owner - have kept 40m of value from my shares.
Its obvious where this is going....
If I reverse into NUOG the business gets 8m of tax losses to use. And the existing holders are really happy because they have had 40m of asset added to it. But me? Well I am a bit grumpy. I have given away 40m in exchange for precisely nothing.
That doesn't really work does it.
I am going to want the lions share of equity in the new venture. Perhaps 80% on the asset size above.
That's ok. Its fair to both existing and enlarged holders. But it does mean you have to be careful when thinking about aggregate valuations. The revised valuation is not important.
It is how much of it accrues to the existing equity holders.
In essense it comes down simply to "how much share of a valuable asset will somebody give away in exchange for access to the tax losses". That is what is being swapped.
I personally think there is a reasknable chance of perhaps 3-4 times current price in that scenario.
Beyond that is harder to see. It needs develipable assets that are developed by the company to accrue more value beyond.
I don't think thats new is it ? They had updated various parts of the website with "we are transiting to shell and RTO" whilst it was all going on.
Maybe they missed that page and the mugshots.
Is out again today. Absolutely no idea what ruly my post can possibly have breached.
Ahwell.
Absolutely Dickbat. I can't recall ever reading anything I'd consider rampy from you.
It seems to me that many have a very low threshold for what they consider ramping or bashing.
What that says, in effect, is that the losses are limited as to how much can be used at what point.
Nuog have approx 8M of potential CT losses.
Lets say that in the next AP nuog miraculously make 40m of taxable profit. CT is broadly 8m so they can offset and pay zero CT.
No.
What they can offset would be 5m + 20m so 25m profit could be relieved. Broadly 5m of CT. Thus 3m CT would still be needed to be paid
But there is still 8m - 5m = 3m of future relief going forwards.
It may be possible to gain more relief by virture of the usual 1yr carry back reliefs for the pre tax losses.
This is to prevent the ability to "buy" an acquisitions tax reliefs.
The overarching intent is to allow relief against future profits - not allow relief against historical intra group profits.
SBP, very true on the use of losses.
But it doesn't necessarily have to be production which generates those taxable profits to offset.
It could, for example, be the chargeback of services. Or possibly even an asset revaluation upwards. However in this case HMRC would look very carefully at the overall substance of the transactions and disallow if there was no real commercial reasons behind it (i.e. manufacturing trading revenue by "converting" capital expenditure is not offsetable).
Hence the substance of any reversal is important.
Dickbat, there is a certain amount of flexibility over what constitutes a "concert party". In the case of these 3 individuals even if fairly closely connected they could claim that they are not bound to act in concert and can declare individually. I have no idea how closely or otherwise connected they are. It only becomes really significant at combined holdings of 30%.
As to Staten and insider trading ....
It is not being in posession of inside info and trading that is the issue. It is trading as a result of that information. A significant difference (if it were the former then a director for example could never trade. Ever.)
The cautious will therefore obtain regulatory clearance detailing their reasons for the transaction. Given the connection it seems certain this has been done. Again quite a lot of greyness.
Piper, they are similar amounts. However they can't (ie shouldn't) be connected. If they were it would strictly require combined holdings declaring.
Staten is connected to the Nomad so that suggests something is afoot to me.
There have been rumours of 2 appointments for a while. That seems slightly odd.
Quite why the company needs anybody currently from a production or exploration background when it has no assets doesn't seem entirely logical at the moment.
What is surely needs, as it has stated, if the reversal in of some (preferably producing) asset. It may need the rumoured staff some time after that.
Any short term staffing needs would be best served by those associated with the asset.
That is simply based on a computer algorithm. Sometime it works. Sometimes it doesn't.
If you do an actual analysis of the price you could gave actually transacted at the day after their signal (which is the best you could actually do) their general results are woeful.
They allow 0.6% for broker and spread. Factor in a reasonable number that is achieveable and very few of their trades would have worked out.