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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Enteq Technologies Plc | NTQ | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| 0.00 | 0.00% | 9.00 | 08:00:09 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 9.00 | 9.00 | 9.00 | 9.00 | 9.00 |
| Industry Sector |
|---|
| OIL & GAS PRODUCERS |
| Top Posts |
|---|
Posted at 13/3/2024 14:07 by optimist4now Thank you ValueHurts.I will amend my NTQ metric tracker to take the "salary in shares" point on board. Fingers crossed for the up coming "customer technology demonstration". |
Posted at 06/3/2024 11:51 by optimist4now I cannot find any NTQ purchases from the not so new CFO.Have I missed something? |
Posted at 12/2/2024 12:09 by sturmey I just posted this comment on the POS board. I have followed Paul Scott's cheerleading of POS with interest but there are too many red flags for me.Talking my own book here but a better alternative to POS might be Enteq (NTQ). Half the market cap of POS at £7m and has a potentially massive new product (SABER). Same industry at POS (oil drilling). NTQ is cash rich and has decent institutional holders. Management have skin in the game and have taken shares as payment in recent years. I have held this for over 10 years and followed closely and have a large holding. There are some good comments on the NTQ board from the small band of followers and shareholders. It's a binary bet on the success of SABER (see today's update RNS) but the risk/potential return is positive. |
Posted at 12/2/2024 07:55 by somerset lad In the AGM statement of 29.9.23 NTQ said “A commercial contract is in place and customer-testing operations are planned later in the year as part of this contract.”By the interims on 15.11.23, testing was planned for the new calendar year. I'd been hoping that the next news would have been that the customer tests had been run and passed. Today we're told that customer testing should "commence" by 31.3.24. It looks from today's announcement as though the slippage is because the new Engineering Director has made further tweaks and NTQ have done a further round of testing at surface which has validated those tweaks. NTQ now seem comfortable that they have a product that will work in the market as they've invited customers to a further set of downhole tests at Catoosa again by 31.3.24, and they'd presumably only do that if they're expecting the results to be good. Overall, the direction of travel is positive and some patience to finesse the specification at this stage is likely to be repaid later. |
Posted at 16/1/2024 10:40 by 1gw I was prepared to put the Miton sell down to redemption requirements, but it is disappointing to have 2 sellers. Do they really see NTQ as the best option to realise funds for redemption, if that is what is driving it? |
Posted at 03/12/2023 15:30 by sturmey ValueHurts. I listened to the most of Paul Scott's podcast (no 48)and failed to find the bit about NTQ. Can you tell me the timing of the NTQ comment? I only skipped a bit at the beginning so that's when it might have been. Sturmey |
Posted at 23/10/2023 14:59 by somerset lad Novision, we don't know the targets, which is not unusual, but not ideal. Thinking about incentives, Martin Perry has a 6.7% stake but is not a beneficiary of the awards. Whilst Martin is not chair of the remuneration committee, his presence on the board means (I think) that existing shareholders are protected when incentive schemes are put in place. Martin would presumably want to minimise dilution whilst strongly incentivising the core management team to get NTQ to major growth (see previous discussion about how much NTQ could be worth). Andrew has a fairly large shareholding (2.7%) so has an incentive also to think about the downside of taking too much risk. I'd like to see Mark buying in the market as well as receiving options that incentivise focus on the upside, but of course we don't know how much free cash he has.Returning to 1gw's posts from earlier, I agree that we need to see what Cavendish say. The previous finnCap forecasts (from the July 21 initiation) were not ideal because (i) they did not match up with NTQ's calculation for the impairment analysis - if we cut through the theory and recognise that the house broker is a vector for the company's own forecasts then what the broker says and what the company says should match (subject to any changes over time); and (ii) they made no sense because they used scenarios but applied a "risk factor" to the revenue line in each scenario(if they want to do scenario analysis they should run the scenarios on their face and then weight the probabilities of each to get a blended view). I don't think Cavendish will publish a GM forecast though, because Andrew has always been very coy about that (although eventually the numbers will be clear to all in the accounts). In terms of competitive response, I asked on the call whether SABER's offering a 30% saving meant that it would be priced at $3.5k per day vs market rates of $5k per day and was told that it would be priced in line with market at $5k. This surprised me a bit as I'd expect a novel technology being launched into a conservative industry to have to offer a headline discount to drive uptake / utilisation. But their answer was given with the benefit of one signed contract and lots of discussions with potential customers. Thinking about the incentives of the incumbents, there's no reason for them to reduce their standard prices in response to a competitor who is heavily capacity constrained (I modelled 5 units from 1.4.24 and looking again at the AR23 I think NTQ are modelling 10) because the profit sacrifice would be huge. Since prices are set individually, the competitors could in theory bid lower when they know they are up against SABER but the danger is that offering individual discounts pulls down rates across the market as a whole (Andrew has said previously that news travels fast in the US O&G market). Overall, the incentive for the incumbents is to continue to pull in the profits from their existing business (a bit like the Innovator's Dilemma discussion). If SABER gets traction, the competitors could try to kill NTQ by acquisition but antitrust is now very attentive to killer acquisitions (mainly in tech, but generally). Like 1gw, I do, though, see potential (in a success scenario) for NTQ to supply SABER to larger industry players, enabling the rivals to keep control of their customers and NTQ to improve distribution without much investment and NTQ seemed open to something along these lines when they were answering the IMC question about discussions with competitors. |
Posted at 21/10/2023 19:21 by somerset lad Final comment: the last question yesterday was about possible exit.Whilst there are obviously lots of possible scenarios, at its heart NTQ is IMO binary: either it trips up for some reason and can't recover (in which case it's basically a zero, although someone might pick up the technology on the cheap) or it becomes a significant independent player by offering a better product at a lower cost to utilise, protected by IP (in which case the right longer term aspiration - despite the current lowly market cap - is a main market listing and FTSE 250). I don't see NTQ as, say, a potential double next year on a private equity bid if the commercial trials are positive. NTQ would be a lovely opportunity for venture/private equity because (as already noted) there's a large TAM, a strongly differentiated product and robust barriers to entry, so the upside from success is huge and the downside is limited to a zero. That opportunity should be defended by the current shareholders. Management is acting like they think there's a pretty good chance of the upside of the binary scenario playing out. Andrew Law took 61% of his pay in shares in FY23; whilst allowing that the capital markets weren't very receptive, if his main priority was his salary he would have pushed for a raise at any price to enable NTQ to pay him in cash. Similarly, IMO the new FD and new non-exec have not joined in the expectation of presiding over a managed wind-down. The board has sold XXT and the Houston site to generate cash to go all in on SABER: if the pay off from SABER were low or the chances of failure were high, they would presumably have hung on to XXT so they would have a business and jobs / board roles if SABER fails. I therefore agree with management's answer to the exit question - they're focused on pressing on with the opportunity. |
Posted at 21/10/2023 18:58 by somerset lad To finish off the stream of thought: if the unit economics are good (GM of c. 73%) and NTQ can self-fund the roll-out to 40 units as at 1.4.27 (recognising that there are many reasons why this might never occur), what position would NTQ be in?NTQ incurred Admin costs of $1.7m in FY23. On yesterday's IMC they said that the current staff in the UK was sufficient to assemble 10-20 units p/a, which would allow NTQ to get to 40 units on 1.4.27. The reality is that Admin costs will grow significantly as NTQ transitions from development to commercialisation, with sales teams, account managers etc. Purely illustratively and without discounting, for FY28 (from 1.4.27) let’s assume 40 units generating gross profit (in today’s money) of $655k = $26.2m (plus some for redress, refurbishment and lost down hole fees). And central costs at $10m (up from $1.7m). PBT at $16.2m. Assume tax at 25%. PAT at $12.1m. 70.6m shares in issue. 17.2c EPS / 14.2p. If NTQ overcame all of its challenges and got to this rough position, what multiple might a business attract that's able to invest capital in new units generating a GM of 73% and a payback of less than 7 months and is growing quickly? |
Posted at 21/10/2023 18:50 by somerset lad So, if the unit economics are potentially great for SABER (see above), how many units will NTQ be able to build and utilise over what period?The impairments note in AR23 says 5-20 units during initial roll out in each “key region”. On yesterday’s IMC, the “key regions” currently were said to be US and Middle East. This implies an initial roll out of 2 x (5 to 20) i.e. 10 to 40. But the recent non-exec announcement suggests that the Middle East is running a bit behind. And anyway it probably makes sense to put all the units and support into one region initially if there is enough demand. So let’s assume NTQ starts its commercial roll out with 5 units on 1.4.24 in the US. If the unit costs are $500k, this would cost $2.5m, which is well within NTQ’s available cash (though the incremental cash cost from today is likely to be lower than $2.5m because the fleet has already been partly constructed with NTQ needing to add/switch parts and assemble by 1.4.24). At 50% utilisation at $5k per day / $900k p/a and a $500k unit cost, each unit crudely generates enough cash to buy another unit after 5/9 of a year, i.e. less than 7 months. This is consistent with Nov 21 IMC where it was said that the rental model becomes cash positive in a relatively few number of months. In practice the cash won’t come in straight away and there will be some cash drain as central costs rise during transition from development company to commercialisation. Assume that each unit generates enough cash to buy another one after 12 months, so NTQ can double the fleet every 12 months from its own cashflow without needing to raise fresh capital. This gives us 1.4.24: 5 units; 1.4.25: 10 units; 1.4.26: 20 units; 1.4.27: 40 units. If NTQ reaches 40 units on 1.4.27 it would have completed its initial roll out across two regions. Conversely (of course) there are many reasons why NTQ might not get to 40 units on 1.4.27, e.g. if NTQ fails the commercial tests, fails to win any new customers, fails to generate good utilisation. |
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