Advanced Oncotherapy Share Discussion Threads

[vatnabrekk] 30/11/2016 10:45

All of the current uncertainty and confusion could easily be sorted if they would just come out with a transparent statement. It seems to me that they just don't "get it"!

[twirl] 30/11/2016 10:21

Here's my attempt to sum up my view for the long view

Pro's 1 Superior product 2 Well qualified development team 3 Directors have "skin in game" and one bought this week 4 Miky recent 7% holder 5 Planning permission Harley St

Cons 1 Testing due to complete end 2016 and "delay" equals dilution 2 Swaps not announced for Harley St 3 Chinese cancellation 4 Hitachi involved 5 Further gearing being sought by end of 2016 - extract from rns 30.09.16
"an additional financing plan supported by banks and strategic partners which will not be dilutive to equity investors. Further details of this financing plan are expected to be announced by the end of the year."

In the short term we will have TW and others making hay whilst there is no positive news.

It is my hope that the Chinese cancellations are due to Harley St as there was a link there to stage payments. It is my fear that it is also due to testing snags as otherwise surely they could prioritise the first machines for China.

My speculation is that Hitachi or others with more capital will make an offer once testing is complete and that a battered share price makes that cheap.

[igbertsponk] 30/11/2016 08:04

Questions need to be raised about the basis on which the directors bonuses were awarded: if they were because of the Chinese contracts then they perhaps ought to be repaid?

[werty5] 30/11/2016 07:49

This is bad and I mean really bad. The BOD are treating shareholders with utter contempt at the moment. I am utterly amazed that no detailed statement has been issued which gives a outline on revised time frames and what the issues are regarding the Chinese contracts, we have not even heard how everything is progressing with the testing of the components for some time. I think what makes it worse is 6+ months ago the updates were regular and reasonably informative which just makes you feel that now there is something to hide. I as I stated on a previous post have withdrawn my funding because I feel the BOD have dropped the ball, surely the first thing for them to do to pick the ball up and start running with it again is to issue a statement of clarification. Even if the statement contains bad news at least they can say this is the situation and this is what we intend to do about it. Which I believe most holders would prefer to absolutely nothing.

[vatnabrekk] 29/11/2016 20:48

I agree karolina. They can stop trying to avoid coming out with a clarification statement. Nothing else will restore confidence, and the longer they take, the harder it will get to fix it.

[igbertsponk] 29/11/2016 13:16

I see they even got the Director dealing announcement wrong. Clearly aren't keeping the proper checks on Directors judging by this and the Lord Evans fiasco.

[twirl] 29/11/2016 13:07

Equally he should not be aware of any good news prior to purchase - so possibly a wait before any good news eg testing

[gerhart] 29/11/2016 10:58

I guess there is one thing we can be sure and positive about, as a result of the NE share purchase, and that is there is no more short term negative news due. Doubt he would have gone in now if he knew/thought there was.

[vatnabrekk] 29/11/2016 10:34

It's good news that the non-exec has bought shares, but that doesn't solve the problem. We still need a statement of clarification from the company. And regards Hitachi, the announcement reads as if Hitachi are acting as technical advisers to Sinophi, and it doesn't suggest that Sinophi are looking to use the Hitachi machines. But this is a big grey area, and one that AVO really ought to have explained to its shareholders ages ago, and certainly ought to come out now with clarification.

[daijavu] 29/11/2016 10:23

I was surprised to see the Hitachi MOUs with Sinophi. Does it mean that Sinophi is representing both AVO and Hitachi in China or that Sinophi no longer represents AVO?
The latter might explain MK's involvement. Perhaps she is heading up AVO's Chinese marketing from now on. She certainly seems to have a reputation for success in China.

I agree that AVO has some explaining to do but the only thing that particularly gets to me about the drop is that if I'd seen it coming I would have sold at the higher price, and be thinking of buying back now. I'm still attracted by the technology and the promise of great things to come.

The other thing about Hitachi is that their machine is a synchotron so no matter how much it might have been minutarised, it is still likely to need bulky radiation shielding, have high maintenance costs and be expensive to decommission. In going for the Hitachi machine, the Chinese may have made an expensive mistake.

[igbertsponk] 29/11/2016 10:20

Non exec buys £48k worth. See if that stops the rot.

[john henry] 29/11/2016 10:06

Must admit to being very disappointed with the managements attitude to what has become a confused mess, creating much uncertainty amongst investors.

[theprovosts] 29/11/2016 09:04

I wouldn't worry, the same sweet noobs appear every time on these BB's when TW posts. He gets it wrong way more often than right.

These high beta chasers spreading manure are the ones who buy just as they coerce the fearful to sell at the lowest of lows. They disappear just as fast as they arrive, once they made a few quid on the sheepies.

Best contrarian indicators on the market, buy when the manure coming out there mouth reaches a peak.

PLUS and INTQ are the ones in recent memory where they spread the usual, only to see the price quadruple. There not in the business of spreading dung for nothing, its the newbie investors who sell 5 days after the fact they chase.

Bye....

[vatnabrekk] 29/11/2016 08:37

I was half expecting an RNS this morning, but none so far. Given the recent media reports and comments, the serious fall in the SP, the obvious concern on this BB and others, and concern expressed to the company by shareholders, I think the lack of clarification is despicable. As I have said before, they are treating the shareholders with contempt.

[sweet karolina] 29/11/2016 08:14

vatna,

I take it you agree the company has explaining to do on all the other matters and thus far there is no explanation.

Putting a liability on the balance sheet to counterbalance cash in the bank received is fair enough if the deposit is returnable. However to make the cash flow statement work some income needs to be recorded. This income must be reflected in the P&L as revenue as the money has been received or by some other income in the cash flow statement but seeing as it is part of a sale it must still be reflected as operating revenue. It is perfectly legitimate to book revenues that have not been received and indeed to accrue work in progress revenues, but you must not over do that eg what QPP were doing. A milestone payment is not a deposit it is a proportion of total order value paid for making a certain predefined level of progress towards final delivery and is done to help the supplier manage its cash flow. It is unwise to allow milestone payments to get ahead of the supplier's expenditure ie keep them at cash flow risk.

Accounting for it as a deposit in liabilities suggests it could need to be paid back and with the Hospital order being terminated that would most likely be the case with this money and that need to be clarified. So far the silence from the company over statements made 2 days ago on its partner's website, clearly in direct reply to AVO's RNS, is deafening. The sell off will continue until they clear these matters up if they can.

[vatnabrekk] 28/11/2016 23:11

Karolina: As I posted here yesterday, the milestone payment is not a problem. I said:

"Now, as any half-decent Accountant will know, a payment in advance is actually a deposit and should not be taken as Revenue into the Accounts. So this milestone payment has been treated correctly by AVO and is shown in their 2015 YE Accounts under Current Liabilities, as "Customer order deposits received £161,033."

In the Accounts, Revenue should be set against corresponding costs. In this case, so far there have been no costs because AVO have not started to manufacture the units for Sinophi, so the money received cannot be taken as Income (profit) yet, so it is correctly shown under Current Liabilities.

What gives me much more concern is the MOU between Sinophi and Hitachi, and the way that AVO have not been transparent in their RNSs, particularly with regard to the reason for the cancellation of the arrangement between Sinophi and the hospitals, and their delay in announcing the cancellation, and their refusal to explain the reason when asked directly.

[sweet karolina] 28/11/2016 22:47

John,

There are a lot of things that do not add up. There may be explanations, at best those explanations can only serve to dent confidence in the competence of the management - we did not realise, we forgot, we made a mistake, we misread the contract, we did not check, we thought it was right at the time but did not update when we found out it was wrong etc.

I do not believe they are con artists, however when walking a tight rope between maintaining investor confidence in order to raise the money needed to progress the project and meeting market rules on transparency, many AIM companies, and indeed main market listed companies, release statements which are less honest than they really should be. It is a slippery slope, as having been a bit economical with the truth once it is hard not to be even more economical with the truth the next time something inconvenient occurs and this can spiral down into outright lies and deliberately misleading investors. I have seen this happen so many times. Hopefully AVO can clear the matter up, but if they try to obfuscate with more half truths or even lies they will end up going all the way down as the truth will come out in the end.

[john henry] 28/11/2016 22:10

It will depend if they have deliberately mislead investors. Some how I don't believe this company would, far to much at stake and the directors have been very open in the past, they don't remind me of con artists , sharks out to fleece investors dry and line their own pockets. Believe me ive had money invested in a few of those.

[sweet karolina] 28/11/2016 21:54

John,

I think we both agree a clear statement is needed. Without one the only was is down.

If AVO has deliberately misled the market, then the Nomad would be likely to resign. If that happens everyone is trapped. Anyone with a notifiable holding is trapped anyway as there is not the liquidity for them to sell down their position without causing a mass rush for the exit, which is why it is rare that IIs sell. PIs can sell and have been selling. That selling will accelerate if there is no clear statement.

They need to also clear up the matter of the milestone payment:

From 21 Sep 15:

" confirms that it has received its first milestone payment for a LIGHT Proton Therapy System. The payment was made by Sinophi Healthcare Limited ("Sinophi") in accordance with the purchase agreement for the Company's LIGHT proton therapy system announced for the oncology hospital project in Huai'an City, Jiangsu province in East China on 25 March 2015. "

That is revenue (you can book revenue without receiving payment, you can even book revenue without even having submitted and invoice, but if you have the money in the bank it has to be revenue, if there is a danger that it might need to be paid back or you have the money but have not done the work eg an upfront payment, you can include a liability against it in the balance sheet) and there is zero revenue in the 2015 report. The 2015 report makes no mention of the milestone payment, but there are prepayments under receivables, ie money owed but not received. The cashflow statement cannot balance without revenue being declared, if the money was actually in the bank. The auditors would have picked up on it. It may be that a payment was made when announced, but later had to be paid back and that was not announced, the auditors would not pick up on that as the net effect would be zero revenue and there was no mention of a payment in the 2015 report. The 2015 report and the RNS announcing the purchase order says it is with the hospital through the partnership with Sinophi. The precise commercial relationship between the various parties is not clear, but the RNS regarding the milestone payment says AVO received it from Sinophi. It is not clear whether Sinophi paid it from its own money or whether Sinophi were passing on AVO's cut of a payment made by the hospital. All this needs to be cleared up. Just because a contract is under UK law does not mean it does not have break clauses and default clauses. Sinophi makes clear that it is AVO's failure that has led to the hospital terminating the agreement between Sinophi and the Hospital. Sinophi may be lying about that, but that would not bode well for the ongoing relationship between Sinophi and AVO. It is clear that the relationship between the hospitals and Sinophi has been terminated, if the hospitals had paid any money and it was AVO in default then you would expect they would want their money back. Either way the hospitals are not waiting for AVO to produce a prototype, they have terminated the agreement no doubt quite legitimately based on a break or default clause in their agreement. What this really means for any milestone payments and any potential future revenues to AVO from Sinophi needs to be made explicitly clear. It is clear that Sinophi are not doing anything to progress thing further at the moment, which is contrary to the AVO RNS.

[john henry] 28/11/2016 21:46

Unfortunately the last few days have completely undone the last 3 years. Management need to put out a comprehensive update with timelines. im pretty sure Institutional and large strategic investors would be demanding this Volume wouldnt indicate that they haven't been selling. Just PIs, some deliberate, some panicking and some stopped out. Buys and sells pretty even today.

[john henry] 28/11/2016 21:31

Ok there's one or two items that require clearing up. However the markets is simply not seeing the great progress that has been made these past 2-3 years.

[john henry] 28/11/2016 21:28

Sweetkaroline, have you read the update. AVO have been unable to give them an agreed timescale for delivery of the machines. I actually agree with you that there may have been a communication problem. The RNS was clearly rushed out with very little content. Hopefully an RNS giving a detailed explanation. As for Nomad resigning that little premature. Had fraud been committed, have they deliberately set out to mislead investors. I don't think so. This is not a some fly by night company with a crazy idea floating around in a bubble. It's a company containing some very astute clever people in partnership with some very large well respected companies.

[pyglet] 28/11/2016 21:03

It's the management that is THE problem. They are totally un investable as they are just not forthcoming with the truth as it happens. It's all about trust.