Atome Share Discussion Threads

[barony] 14/3/2024 08:45

Makes it attractive to investors surely?

[dake1] 14/3/2024 07:45

I have to confess I do not fully understand the potential consequences of this anyone have an idea of why the company has applied for this. As I understand the company is fully funded to FID with project finance looking achievable with no need for stock dilution any accountants out there?

[all in eol] 14/3/2024 07:01

14 March 2024

ATOME PLC
("ATOME", "the Company", or "the Group")

Enterprise Investment Scheme ("EIS") investment status granted by HMRC

ATOME (AIM: ATOM), the only international green fertiliser project development company on the London Stock Exchange, is pleased to announce that His Majesty's Revenue and Customs ("HMRC") has granted EIS status for the investment made by certain qualifying individuals in respect of the equity fundraise which was announced on the 19 February 2024.

The EIS is a UK government initiative which encourages investment in qualifying companies by offering tax benefits for qualifying investors who subscribe for new shares. For the avoidance of doubt, EIS income tax relief is not available for directors or employees of ATOME.

Subject to certain conditions being met by the company and the investors, EIS enables a qualifying investor with a UK tax liability to claim tax relief in the UK of up to 30% of their investment, subject to a maximum investment of £1 million per tax year. In addition, when investors sell EIS shares, any growth in value from an investment is potentially free from UK capital gains tax (to qualify for this relief, income tax relief must have already been claimed and not withdrawn by HMRC. Investors also have to hold the shares for at least three years and the company and its group must remain EIS qualifying for at least three years). Further details about EIS can be found here. Prospective EIS investors should seek their own tax and financial advice.

The directors of ATOME also believe that an investment in the Company would potentially constitute a 'qualifying holding' for a Venture Capital Trust ("VCT") subject to certain conditions being met. A company can receive a maximum of £5 million from EIS and VCT investors on a 12-month rolling basis. The grant of EIS status broadens the Company's potential investor base as it continues to develop and grow. However, the Company reiterates that it intends to finance its first 145MW project in Paraguay at the asset level through its subsidiary, ATOME Paraguay.

The 100% green fertiliser that is targeted to be produced by ATOME from 2026 has a worldwide market, none more so than in the UK and Ireland where decarbonisation of the entire agricultural supply chain from supermarkets down to the farm is gaining increasing traction, importance and support. ATOME looks forward to delivering further positive news in the next months as it moves towards Final Investment Decision and asset level-funding for ATOME's world-scale 145MW green fertiliser facility in Paraguay. For completeness, ATOME has an exciting 100MW project in Costa Rica as well as the Phase 2 300MW project in Paraguay.

Philip Hare & Associates acted for the Company in the successful grant of EIS status and continues to do so.

[dake1] 13/3/2024 17:27

I do not understand where you get $350 for off take of CAN I think it should be higher!?

[mcunliffe1] 13/3/2024 16:32

pj1985: Thankyou. That's more (detailed) info. than I've heard/read from Atome themselves.

With 44m shares (approx.) the £32m profit estimate is £1.37 per share. £0.69 at the 'half' profit estimate if 50/50 partnership.

Per year.

I've not a clue what the P/E ratio would be - but suspect it provides a share price better than 51p.

Of course I might be talking complete tosh - I am quite new to this game but I suspect many on here are not.

Appreciate the info. you all provide.

[dake1] 13/3/2024 16:26

Pjohn1985 good comments can you provide your workings etc to justify your assumptions. For the record I pretty much agree with you
Thanks

[pjohn1985] 13/3/2024 15:32

The business case for atome as far as I see it given what data is publicly available.

It should be possible for Atome to produce green CAN for around $275 per ton.

According to the industrial tariffs supplied by ANDE a 145 MW facility running 24/7 would result in $38 million of electricity costs.

The costs of water, dolomite, loan interest and plant running costs would come in at around the same giving a total annual cost of $76 million to run the facility.

Its estimated Atome will produce 270,000 Tons of CAN.

The current wholesale market prices of AN and CAN vary by region but seem to range from $350 to $450. For example the current price of AN imported to the UK is $450.

In 2026 the EU and UK will apply a "carbon border adjustment mechanism" to goods including fertalisers. Buyers will have to pay for every ton of carbon emitted during production.

The price per ton will be based on the market price of the "EU emissions trading system" (EU-ETS). This is what we commonly refer to as carbon credits. currently trading at $60 per ton. On average 1 ton of fertaliser produces 2 tons of carbon.

From 2026 the price of grey AN in the UK/EU for example could rise from $450 to $570.

Atomes product being zero emissions would not be subject to these taxes hence the "green premium".

Given this it should be more than reasonable to offtake the CAN at $350 per ton giving an annual profit from the Villeta facility of $20 Million.

This does not include carbon credit sales which could be significant. for example tesla for a long time made more money selling carbon credits than actual cars.

This is obviously only my opinion given what public information is available and we dont yet know how the project will be financed.
We know the IDB is prepared to give Atome a $125 million loan. I have made the assumption the rest of the financing required will be borrowed at 8%. However I wouldn't be surprised if an equity investor stumps up the rest for a 50/50 partnership in the plant. If this were to happen Atome half of the profits would be around $16 million however the project would carry far less debt and therefore less risk.

[mcunliffe1] 13/3/2024 11:50

Morning Dud.

There's nothing too challenging with the technology being employed to produce the fertiliser so I would say yes, other could produce the product.

However, it seems to me to be down to the cost of the energy needed to electrolyse water into hydrogen in the first instance. ATOME started life as a potential green Hydrogen producer but there's a limited market in Paraguay for that product. Convert it to ammonia and it's easier and safer to transport.

They have a planned operation in Iceland where geothermal generated electricity is again cheaper than in most industrialised countries.

Farmers have an acceptance of long-term investments and I hope your son is amply rewarded.

[dudishes] 13/3/2024 11:23

G'day,

Tks MC for ref. Discussed with Son.

My youngest (farmer),is a holder.

Naturally, I am the last to hear of these matters.

Despite my lack of research, I do question the term "Only supplier in the world"?

Considering the EU are pushing, is it not possible for others to produce the product?

What I do know is that there is interest in France, Brittany in particular.

BOD skin in the game is attractive, a major plus.

cheers

[all in eol] 13/3/2024 09:32

Link to current article and Atom mention.

[mcunliffe1] 13/3/2024 09:20

Thanks for that link weywey. I was unable to open the X link as well.

This article was dated Sept 2023 but is still a useful piece. I watched the video of the interview with Olivier and picked up on the aspect of rising taxation levels on non-green fertiliser. This link explains more:



If levies rise considerably they will negate the cost of shipment of green fertiliser from the Paraguay and Costa Rica production facilities into Europe.

The MoneyMail report stated the share was a buy even at 82p - it surely is now, six months down the line and at 52.35p

I will watch for the next share price movement.

[weyweyumfozo] 13/3/2024 09:03

For anyone like me, who can't open that X link, here's the link to the Mail:

[all in eol] 13/3/2024 08:42

There was a tip on Sundays Midas column

[nafnaf3] 13/3/2024 08:33

Disagree MC. They are fully funded, no more dilution and placement shares are now fully taken, surely upwards from here? Best of luck everyone

[mcunliffe1] 12/3/2024 15:07

My guess is the share will drift downwards again. This small up spike may be resulting from the interview which I was impressed with.

However, without any positive comment or better yet, some actual activity, drift downwards I expect and intend to buy some of these myself when that happens.

[nafnaf3] 12/3/2024 14:42

Still above recent 50p placing so share price should start moving northwards

[chris cat] 12/3/2024 13:07

Indeed ..... Just another 50% from here and we are at the IPO price from 2 years ago

[barony] 12/3/2024 12:34

Very interesting.

[mcunliffe1] 08/3/2024 17:54

The link below will take you straight to the IG video.



I was very impressed with Olivier Mussat's interview. I was a little concerned with his statement at about 8 minutes 25 seconds into the video wherein he said they will be in production in Paraguay by the end of 2026. Costa Rica would be in prod. by about mid 2027.

This is still a way off and allows the share price to slip further as we've seen it do since Sept 2023.

I am very hopeful for this venture/company and whilst currently it is only my three grandkids' investment trusts that have a very modest investment - and one that is losing money - I am minded to take a stake myself next week when perhaps the excitement of Olivier's IG interview has subsided.

Sadly, I was hoping he would mention the critical engineering requirement being the electrolyser but that was never mentioned.

[barony] 08/3/2024 17:19

As Olivier said, it looks like the Hydrogen world over promised and under delivered, hence the drop. It didn’t really, punters just had unrealistic ideas of how quickly things could move. Exciting times ahead. (Hopefully!)

[nafnaf3] 08/3/2024 10:33

IG interview

www.ig.com/uk/news-and-trade-ideas/atome-energy-leading-the-way-in-green-fertiliser-240307

[all in eol] 07/3/2024 18:03

It is a great project IMO, but the share price keeps dropping because someone is dumping so timing regarding entry price?

[nafnaf3] 07/3/2024 18:01

Surely a great opportunity to get in on an excited project; am I missing something??

[barony] 29/2/2024 19:30

The fall is large and dramatic. Why hasn’t the company made some kind of stetement? Will they wait until it drops much further?