Deltex Medical Share Discussion Threads

[bypooh] 21/9/2015 17:00

Of course you knew so that is why you posted

BigT20 18 Sep'15 - 15:22 - 7591 of 7601


--> and/or the bank factoring US probe invoices.

Which they already do to the hilt.

Anyway, I will leave you to your steaming research.

[bigt20] 21/9/2015 16:47

bypooh 21 Sep'15 - 16:07 - 7599 of 7600 0 0


Research, indeed! I haven't seen anything on this site resembling that recently unless it has been posted by me

---> You haven't produced anything new. I already knew that had an invoice facility with the bank (thats in the Annual Report) and that they sell to distributors (who buy in one offs) at the year end.

[bigt20] 21/9/2015 16:42

bypooh 21 Sep'15 - 16:07 - 7599 of 7599 0 0

Yeah right BigT

So which of the two, Portland Oregon or Greater New York has left?

--> As I said if you do your research, you will know!

[bypooh] 21/9/2015 16:07

Yeah right BigT

So which of the two, Portland Oregon or Greater New York has left?

And you think that marching powder from Peru will help?

Research, indeed! I haven't seen anything on this site resembling that recently unless it has been posted by me.

[bigt20] 21/9/2015 15:59

bypooh 21 Sep'15 - 15:31 - 7596 of 7597 0 0

BigT


'Cash looks like it might be an issue but we were told December is a big cash-in month which will transform the cash position'

--> Apart from the usual year end sales to distributors around the globe
I wonder if this relates to a particular market.....those who do their research will probably understand which one I am refering to!

[bigt20] 21/9/2015 15:55

bypooh 21 Sep'15 - 15:31 - 7596 of 7596 0 0

BigT

It is very unclear whether one is being replaced or not -

--> If you do your research you can see who has left and from where.

[bypooh] 21/9/2015 15:31

BigT

It is very unclear whether one is being replaced or not - another has just left in St Louis - and not all are listed. Whatever, the point is that all this costs money and takes time to generate revenues.

They presented at a recent ShareSoc Growth Investor seminar and courtesy of Dinocras on another site:

'Cash looks like it might be an issue but we were told December is a big cash-in month which will transform the cash position'

The only extra cash they get in December is from discounting the invoices of those of their distributors who order mainly annually, so relatively small amounts, say a bump of £300k. They discount all their invoices anyway to the extent that they can, btw.

So they have sent a letter to Santa and he will transform (rather big word that) the cash position. It has been quite clear for some time that any US national roll-out will require a large amount of capital. Last time they raised and will have spent £4.5 million. The market cap is £11 million. I should doubt that they could even raise £2 million at 2p in new equity. The only route to financing the US expansion is by bringing in investors to the US operation, with a clear exit mapped out. This sort of thing is why the two new non-exec's were brought in.

I overlooked their main asset, which is, of course, the colossal tax losses they have racked up. £10 million at the 20% rate, which is going down, but almost worth the market cap.

[bigt20] 21/9/2015 13:54

bypooh (post 7593)

May I refer you to one I made earlier:


BigT20 25 Aug'15 - 03:03 - 7576 of 7594 0 0 edit

bypooh - it looks like one of those clinical educators is replacing one that has already left.


--> Furthermore it looks like they are replacing the California Account Development Manager so the net new hires looks like 5:
1 Marketing manager
4 CSS (aka. trainers)

Good sign, looks like they are confident about how the business is developing and that they can get the hands on extra finance.

[doglover2003] 21/9/2015 08:06

bypooh

Watch this space.

[bypooh] 21/9/2015 05:32

DL

Temper your optimism.

At the rate the UK is shrinking, it won't take long for the US to go ahead.

More seriously, they 'invested' £700k more in the US than in H1 last year which produced £132k more probe sales. They were making losses in the US in any case. Those losses have increased by £600k and they are adding significantly to the US cost base - 6 or 7 new hires at least. The implication is that they would need an increase in the region of £1.5 million of probe sales to get to cash break-even, or 12,000 probes extra in H2. Given that it is almost the end of September, they might have announced to market that sales were on track to more than triple, compared to the more pedestrian 28% achieved in H1.

[doglover2003] 20/9/2015 20:19

Bypooh

Temper your pessimism?

Did you notice following?

Ewan Philips, chief executive, told Proactive: “The states are better at innovation it’s harder to get going but when it does it [growth] is much quicker.

“The next phase of growth will take us clients from 10 to 30 and WE EXPECT US SALES TO GO AHEAD OF THE UK." ( MY CAPITALS)

Implication: CASH POSITIVE

DL

[bigt20] 18/9/2015 15:22

Daz 16 Sep'15 - 22:07 - 7589 of 7590 0 0

Refinancing the debt with another party, albeit probably at a higher interest rate is also an option.


--> and/or the bank factoring US probe invoices.

[bypooh] 17/9/2015 17:24

So what are they going to do when the cash runs out and when are they going to do it?

It certainly doesn't look like they will make it to year end without financing, regardless of the convertible loan, hence I was looking at the options. The only thing of value is the nascent US operation, although even there Duke and San Diego seem to be shrinking. I think it would be wise to rule out any appetite in the UK for another placing. I wonder how those who invested at 11p in the large funding round would react to a placing at 2p?

So my tentative conclusion is that they will try and fund the 'national roll-out' in the US by selling off an interest in the US business, most likely to financial investors. By that I mean small funds that invest in this sector at the $3-10 million range, of which there are many, some of which are VC arms of hosital groups who invest in companies where they can see a benefit to their hospital group of the company's technology.

This would of course entail giving up significant upside in the US to the new investors, but would avoid a disastrous dilution at TopCo level if that were even possible. I recall a video of Phillips saying that DEMG had to call in all sorts of favours last time. I do not expect him to be able to call in any further ones, particularly given the company and share price performance since then.

So what about timing? The last share options award to Phillips was very bizarre. The strike price is 11p, the price of the last placing, but not exercisable for three years. They didn't award any in the last two years. They also said that 'The Company currently intends to make a further ESOS award between publication of its interim results and its year end of 31 December 2015.' My experience with companies is that they award these things or they don't, but never do they say that they are intending to award more. The next week they hired the new finance director, the calibre of whom caused comment here.

My take therefore is that they have already substantially agreed a deal to bring in investors to the US operation and that this will be announced before the year-end.

[daz] 16/9/2015 22:07

Refinancing the debt with another party, albeit probably at a higher interest rate is also an option.

[february 30th] 16/9/2015 18:54

The Count,

I think bypooh was alluding to the cash issue, and the question of constant placings. So far in the company's history, sales growth has never caught up with the drag of dilution. On the other hand, the rot does seem to have stopped in the UK, at least in terms of two months of sales figures, and something is happening in the US.

[the count] 16/9/2015 18:27

--->FEBRUARY 30TH

'A takeover at 10 - 15p'... I certainly hope not.

Just as they are starting to hit some momentum in the USA and other countries?

I don't think those that invested in that large funding round at 11p would be too supportive...as long as we had the positive backdrop of strong, positive and fast growing US sales.

THE COUNT!

[february 30th] 16/9/2015 18:07

The logical solution is a take-over. The company are growing business in the US, and the today's announcement might suggest that the rot has stopped, in the sense that "UK probe revenues in first two months of H2 marginally ahead of 2014 after 23% fall in H1". Given that, and the valuation given to BMEye by Edwards in 2012, I can't see any problem selling the company for 10-15p a share.

[bypooh] 16/9/2015 13:46

Speaking of the loan due in February

"The Company's working capital plans assume repayment of this loan to the extent that it is not converted to equity, however, the Company is also considering a number of options, including proposals received, to refinance this facility and maximise working capital available."

Assuming Amati are not mental, they will not want to convert unless the share price exceeds 12.5p, and, even then, only if they are confident that it would go up from there or they could sell 8,000,000 shares for at least that price. So what on earth is in the company's working capital plans that would enable them to even consider repaying £1,000,000? With what? Probes?

Cash consumed was £1.6 million, cash left £1.3 million. The cash burn is expected to reduce substantially, but DEMG have often expected things which do not materialize.

On the complete and utter other hand, they are adding three further clinical educators in the US (in addition to those I have previously mentioned), all in the Great Lakes area, only one of which accounts has been announced. They also think they have the cash to replace the Account Development Manager in San Diego. Add to that the intriguing recruitment of a marketing manager, and what do we have?

Sale to a major? Why recruit?

Partner with a major? Ditto, they will want to run the sales/marketing.

Partner with a minor? Yeah really, what is in it for either?

Go bust in a blaze of recruitment? I suppose that has happened before.

Partner with a financial investor?

Answers on a postcard, before the Xmas rush please.

[arf dysg] 13/9/2015 11:44

Apparently chickens are using social media a lot these days.

Yes, they're spending a lot of time logged on to.....


....


....


facebok bok bok bok bok bok

[buywell2] 11/9/2015 07:43

All 3 companies I like have opened Labs in the USA

2 are profit making at this point ... the other due to float on the NASDAQ shortly

All Bio-Techs

Not easy doing business in the USA for a UK company

Even worse with the NHS

[yump] 10/9/2015 22:20

Well if it all comes good at some point, it will be the first company I've seen that fails in the UK market, but succeeds abroad. Usually they go abroad in a flurry of publicity, because the business model doesn't work here, but overseas provides a 'massive potential opportunity' (to issue more shares, increase losses and give themselves higher salaries, as a result of now being 'global').

Me, cynical ?

[p1nkfish] 10/9/2015 21:35

took my eye off this - another funding round needed?

[djgrantb] 09/9/2015 07:48

Excellent news, twice the amount of probes per month over the last account win, not expecting much move in the share price sadly

[ramnik007] 09/9/2015 07:33

Another step in the right direction.

[arf dysg] 03/9/2015 09:44

No-one want to guess?