Ipsa Share Discussion Threads

[simonparker5] 04/1/2013 10:02

Simon Parker is still here thanks.

[topinfo] 02/1/2013 11:22

IPSA paying 3.92p now
###
i,i,i
08-12-12
net worth in the mid-twenties? "ample ca...

Chayanne
1UP
2nd Aug 2011, 8:35 am by Jamie Ashcroft of

By selling four gas powered turbines on July 20, IPSA (LON:IPSA) chief executive Peter Earl may well have brought the company back from the brink.

But having spoken to Earl, Proactive Investors has learnt that this deal is more than simply a means to clear the group's debt. Crucially Earl reckons his South African independent power business will now have ample cash left over to push ahead with a new phase of growth.

It was less than two weeks ago that IPSA's patient investors celebrated the news that two deals were finally in place to sell four gas turbines for £41 million.

The turbines were initially bought for the Coega power plant, a project shelved back in 2008.

Since then the expensive turbines have been a costly burden and the group has had to rely on its creditors.

But after years of uncertainty the future is beginning to look much brighter for IPSA, which now plans to focus all its attention on the Newcastle Cogeneration power plant that generates electricity and also sells by-product steam to neighbouring industrial customers.

"The value of IPSA's remaining business will be quite substantial and IPSA shareholders will benefit from this once the turbine sales are complete and we've cleared our debt," chief executive Peter Earl told Proactive Investors.

"When the dust settles, I believe we will be looking at a net worth in the mid-twenties (pence per share) based on the last audited balance sheet."

At the end of March IPSA had £2.9 million in cash and its debt totalled £36.8 million. Now it is set to receive a £41 million windfall from the turbine sales and it plans to clear its debts, leaving a meaningful cash pile for the group's future development.

"Our cash position should be at least £7 million and it could be higher than that," Earl said.

He explained that around £4 million of IPSA's outstanding liabilities are tied in with a commercial dispute relating to a previous contract with Sasol Gas Limited, and IPSA may actually ultimately pay less than the amount initially claimed by Sasol under take or pay provisions.

Meanwhile, Earl believes that the group's core asset, the Newcastle independent power plant (IPP) could be worth more than the US$23 million it cost to build the plant back in 2006 and importantly he hopes that IPSA's investors will now focus on this part of the business.

"We've made a number of announcements about the Newcastle plant which I don't think many investors really took on board while the turbines were still an issue," Earl said.

"And we're now looking to expand the Newcastle plant to maximise its potential capacity on the grid."

"Newcastle is now in positive cash flow territory and we continue to work on improving margins, revenues and output," Earl added.

"We've got an active contract with South Africa's main power distributor, Eskom, which is buying in power from Newcastle at a premium under the Medium Term Power Purchase Programme (MTPPP)."

"And we are now finally cranking up our steam sales on the site, so we are now generating revenues from power generation and from steam.

"In order to maximise our profitability of Newcastle we have to be selling both electricity and stream, but if we're not generating electricity then we can't sell steam.

"So it's a delicate balance," he said. "When Eskom stopped buying electricity from us in 2008, a period during which electricity demand fell, it was a big problem.

"But now they're buying all the power we can generate at a good price and life is now much easier for IPSA."

Looking forward, Earl added: "It is quite likely that we will look at ways to improve the output at the Newcastle plant, to improve margins – that might mean adding a bit more capacity, tweaking it, or doing some other technical stuff."

Earl explained that this won't be a major undertaking instead it will be a case of juicing some extra

[drewz] 02/1/2013 11:01

See page 22 of NCCL's presentation on Southern African power requirements and increasing role for independent generators going forward; big opportunity for IPSA once we get this turbine cash banked, existing loans paid off and a solid base to spring forward from.

All imho, please dyor etc.

[topinfo] 02/1/2013 10:40

Looks like positive news on its way IMO. Look at sudden buying

[topinfo] 30/12/2012 20:38

They did say by 15th of January or before so why you getting so in a twist as they still have 2 more weeks to complete and receive the cash before the deadline anyway. Chill or take a pill if its causing you that much stress.

[sir leonardo] 28/12/2012 16:58

WHERE OH WHERE IS THE CASH!!!!!!!!!!!!!!

[sir leonardo] 26/12/2012 21:00

SAD TIMES INDEED!!!!!!!!!

[sir leonardo] 24/12/2012 20:02

UP YOUR UPDATE TURBINE HEAD!!!!!!!!!!

[sir leonardo] 24/12/2012 09:58

HO HO HO!!!!!!!!

[sir leonardo] 22/12/2012 00:47

WELL WELL WELL!!!!!!!

HO HO HO!!!!!!!! CHRISTMAS IS COMING BUT THE TURBINE SALE WELL WELL THAT IS ANOTHER THING!!!!!!!!!!!!!


ANOTHER YEAR WILL SORT IT!!!!!!!!!!!!!!!!!!!!!!!!!!!

SIR SAYS HAVE A DRUNKEN CRIMBO!!!!!!!!!!!