Enteq Technologies Share Discussion Threads

[somerset lad] 29/9/2023 14:51

Results are out.

Main area of interest is the assumptions for the impairment testing in note 5. The directors' valuation (which is not stated, but is at least equal to the carrying value of SABER) assumes (amongst others) "the field testing is successful and completed and that the technology can be rolled out commercially from 1 January 2024 without any fundamental developmental challenges."

Also (amongst others): "- that the Group will introduce a phased roll out of rental units of between 5 and 20 in each key region from 1 April 2024 onwards (2022: not disclosed) with a typical number of days usage per unit;
- each rental unit will generate a similar amount of revenue per unit irrespective of the region in which it operates (2022: not disclosed);
- the expected operating life of each rental unit is >5 years and annual servicing costs for each have been included in the workings (2022: not disclosed);
- that the expected revenues arise from projects based upon agreements in place as well as agreements which currently do not yet exist and that the Group will put in place an appropriate plan to field the number of rental units in the model (2022: same assumption);
- that the company currently has the financial resources to build the number of rental units and that there is no requirement at present to raise additional income from new fund raises (2022: same assumption), whilst noting that additional scenarios are continuously under evaluation to provide financing to further accelerate fleet build-up;"

[somerset lad] 29/9/2023 13:35

Thanks, 1gw!

[1gw] 29/9/2023 13:35

Perhaps I should add that, in terms of FY23 results & AR publication, the company has said that it will publish this week and I heard nothing this morning to suggest that that will not happen.

[1gw] 29/9/2023 13:04

AGM was short and to the point as usual. I was pleased to see David Steel (former CFO) there to join me in the cheap seats (so clearly an amicable parting). At the main table were MP, AL, MR and NH. MP looked as relaxed as I ever remember seeing him.

So a good vibe, I felt. They indulged me with a Q&A, also as usual, and the points I picked up were:

o AGM was needed within 6 months of the end of the FY.

o MP was clear that they have enough cash to fund a roll-out of SABER. But AL talked about choices on pace and that is where I suspect a lot of work has been going on and maybe is still to go on in terms of how to optimize the roll-out – go relatively fast with additional funding or go relatively slower with existing funding.

o At least initially it sounded like they would go for a region-by-region approach – get one region up and running before moving on to another one.

o Further communication likely to come post ADIPEC – probably an IMC session around the FY23 results and ADIPEC feedback, and maybe the second SABER webinar once they’ve got a commercial customer or two up and running. Maybe a broker’s note to come out with some guidance before too long.

o I asked for any insights into the lost year, but couldn’t get much other than an acknowledgement that the slot in the US testing site was not as easy to come by as they had originally thought.

Apologies in advance if this contains any inaccuracies or misinterpretations. No advice intended.

[davidosh] 29/9/2023 11:29

Where are the promised results?

[valuehurts] 29/9/2023 08:13

Would be great to get some notes from today. Would be v much appreciated.

[somerset lad] 29/9/2023 08:01

1gw, I have your notes from last year's AGM pasted into my journal. Any similar update from today's event would be very much appreciated.

[1gw] 29/9/2023 07:52

Odd that they don't even mention the AR & accounts in the AGM statement. But good to see news of the commercial contract, the cash position and that "plans are in place for the subsequent fleet build."

I am aiming to get to the AGM, perhaps playing the role of "the shareholder" for the third year running.

[pugugly] 29/9/2023 07:29

Last throw of the dice -

[masurenguy] 29/9/2023 07:23

Enteq Technologies plc will make the following statement at its AGM at 11.00am today

AGM Statement

The international market for Rotary Steerable Systems (RSS), a speciality technology for downhole drilling, is currently estimated at over $2bn annually.* Enteq has made the strategic decision to focus on the RSS sector where there is a large addressable market for Enteq's range of new technologies, notably the potentially disruptive technology, SABER, as well as differentiated specialist Measurement While Drilling (MWD) technologies.

Enteq continues to invest in the engineering for SABER, with $1.9m invested since 1 April 2023, and plans are in place for the subsequent fleet-build. A commercial contract is in place and customer-testing operations are planned later in the year as part of this contract. There has been a strong and ongoing focus on improving the Company's cash position to underpin investment in product line development, primarily the deployment of SABER. In April 2023, following the last financial year end, Enteq divested of the assets and IP related to the XXT product line, for up to $3.2m. The cash balance as at 28 September 2023 is $5.1m.

* Management team's estimate of annual addressable market revenue size.

[somerset lad] 29/9/2023 07:23

Is anyone going to the AGM?

[somerset lad] 29/9/2023 07:22

So we have a commercial contract, which is fantastic! Previously they've suggested that contracts would include provision of the hardware for free for a testing period on terms that automatically roll into commercial terms if the test criteria are met; unclear if this contract follows that plan. No detail yet on the customer or its industry / geography. May get some details in a broker note?

An up to date cash number ($5.1m / £4.17m) as at yesterday is also very healthy, giving an EV of £4.3m for a business with a disruptive technology (30% lower costs, better reliability), a large TAM (c. $2bn) and a moat (the IP). They previously had an overdraft facility with HSBC to fund potential working capital demands as the fleet rolls out; unclear whether this has lapsed.

Still awaiting accounts (I imagine they want the focus on SABER and the future for this morning rather than the historic numbers that have already been covered by the T/S and have little relevance to the group's future; but equally they won't want to go to ADIPEC with the shares suspended...), publication of the results from the US testing (they'd said about Norway that the results would be available a few weeks after testing; presumably the results have been provided to the new customer so I guess it's a commercial decision whether to make them public or selectively release them to commercial targets), a second SABER webinar and an investor webinar (might be useful the week after next post-ADIPEC).

[1gw] 28/9/2023 08:15

Publish and be damned? Don't publish by tomorrow and be suspended?

[1gw] 27/9/2023 21:31

ADIPEC next week.

[1gw] 27/9/2023 09:10

The later this update goes, and with the AGM (Part 1) now imminent (Friday), the more it feels like we're building up to a significant announcement. Hopefully a good one!

[1gw] 26/9/2023 10:29

Cunning plan for shareprice working perhaps. If it weren't for the suspension issue, they might be tempted to delay the update for a further week...

[valuehurts] 24/9/2023 18:46

We are all likely to be quite richer or poorer over the next 5 days. See you on the other side...

[1gw] 22/9/2023 15:45

Looks like the RNS was a buy signal for someone. Perhaps the use of "will now release" instead of the 31st July "expects to release" was the key. Who knows, could be a cunning plan to try to get the shareprice to creep up a bit further ahead of the update?

[1gw] 22/9/2023 15:37

Next week then. Reset your alarms.

Hopefully close enough now not to require further delays (and suspension). Although "in the week commencing" doesn't sound as specific as it might have been.

[mr doughnut1] 22/9/2023 14:12

LinkedIn updated but no RNS??As long as it doesn't land circa 3pm this afternoon, companies tend to bury bad news on a Friday afternoon. I am happy to wait.

[1gw] 22/9/2023 12:29

On 31st July they got the "sorry, we forgot" RNS out at 09:30. Perhaps they're all in the US today trying to close SABER contracts.

In any event, can't really blame this one on the change of CFO. Hope to have news imminently.

[valuehurts] 22/9/2023 09:54

Where is our RNS?

[1gw] 22/9/2023 09:29

Making us wait then. Hope they can get the accounts out before the end of next week. Presumably some sort of update at least on timing today, if not the finals themselves.

[1gw] 21/9/2023 13:11

Anticipation building, it would appear.

[valuehurts] 19/9/2023 18:31

Probably P1nkfish