Juridica Share Discussion Threads

[pillion] 18/10/2014 23:48

Ptolemy; Good find, very encouraging

[jonwig] 13/10/2014 14:34

That's very interesting, thanks - and voted up!

[ptolemy] 13/10/2014 13:22

jonwig,

you mentioned the low profile of their IP investments. Yes, agree. But did manage to dig this out from Capstone Companies, Strategic Update Teleconference and Webcast on August 5, 2014

QUOTE
in regard to the AC Kinetics energy reduction motor control technologies; on July 14 th, AC Kinetics received a $1.25 million investment from Juridica Capital, a publicly traded company listed on the London Stock Exchange. As you know, Capstone made a $500,000 equity investment into AC Kinetics in January of 2013. We believe strongly in the upside potential for AC Kinetics to license its software in the $16 billion motor drive industry to entities such as Siemens, Rockwell, Toshiba, and Schneider Electric to name a few.

AC Kinetics is presently working at a globally respected independent motor and motor drive testing laboratory, named Advanced Energy in North Carolina, to test their motor control technology on many large motors up to 200 horsepower. AC Kinetics will be testing against well-known competitive drives from global manufacturers and expects to receive positive signed-off test results from Advanced Energy, which AC Kinetics will publish and use to further market their technology. Several manufacturing industry trade publications have offered to do articles on the AC Kinetics technology following the field and lab tests.

The lab testing is in preparation for a field test on a 200 horsepower pump motor operating at a manufacturing plant in Georgia, and owned and operated by one of the world’s largest corporations. AC Kinetics has signed a confidentiality agreement with that entity, so we cannot reveal their name at this time. That same company is also notifying their present drive suppliers about their interest into AC Kinetics technology to reduce their energy consumption and reduce power plant carbon emissions as well. AC Kinetics has several other large manufacturing companies requesting field tests. They are in the rubber, mining, metal fabricating, paper, chemical, and several other industries.

Those manufacturers have tens of thousands of large, energy consuming motors in operation. I have been told that over 50% of all electricity produced worldwide is consumed by electric motors that are used by industry, commercial buildings, government, and electric transportation. AC Kinetics offers a significant advantage to the market as it is targeting less than a one-year payback for its end users, which is well below the three- to five-year bar which is their present return on investment criteria for energy saving technologies. As always, you can learn more about AC Kinetics at ackinetics.com.

I stated in the Q2 2013 webcast that—and I quote, “I believe we will look back at 2013 and 2014 as a time of transition that defines Capstone in future years. We’ve been dedicated to establishing our Company’s reputation and its relative value through consistent performance and continual reinvestment into the Company’s future.”
END QUOTE

It all sounds very promising. Also, there is also talk by Captone that “During the second half of 2014 we will be introducing the transformational new power failure lighting products that we have developed with AC Kinetics, and expect shipments to commence in early 2015.” Don't know if JIL has any part in this.

I continue to be optimistic about JIL's future.

[scottishfield] 29/9/2014 12:41

enjoying this share price movement.

[jonwig] 29/9/2014 11:39

Hello Stemis - yes, that's what we concluded in the posts following.

A sticking point is that they don't appear to be funding *new* cases, thanks to their policy of full payout. (They say they are looking at new stuff.) The patent business isn't absorbing much capital as yet.

The next continuation vote is end-2016. I suspect they will be pressed to make a decision on retaining earnings and funding new cases before then.

[stemis] 29/9/2014 10:30

Sorry, I'm a little late to the thread

"Nobody seems to mind that 'Gross proceeds from these settlements totalled approximately US$84.6 million....So $31mn has gone missing. Who has it and why?"

Suggest you read the accounts in full. It hasn't gone missing. Here's what they say about it

Gross proceeds from these settlements totalled approximately US$84.6 million. As part of our investment agreement, we are obligated to return a portion of these proceeds to specific cases in the antitrust portfolio in the form of supplemental investment capital. Additionally, we are obliged to set aside reserves for future funding of the antitrust portfolio. Finally, the Company is also required to pay certain taxes on these proceeds. The level of tax owed on the proceeds has been estimated for our reporting at 30 June 2014. The final determined amount is highly dependent on the performance of the antitrust portfolio during the remainder of 2014.

We have estimated the net amount of proceeds from these settlements to be approximately US$53.5 million."

i.e some of the money is being held back by the lawyers to fund other cases and pay tax.

[asmodeus] 27/9/2014 18:40

Thanks Valhamos. No further comment.

[valhamos] 27/9/2014 12:57

asmodeus

re updated 541 -the "Which" article is misleading - tax is not been deducted rather a 10% tax credit is given against any income tax due (and is not repayable if no tax is due). See the last paragraph in the following and notice how the HMRC explains dividends in the article without using ideas of "gross" and "tax deducted". :




Here's the tax return notes on foreign income.



The relevant bit is on page 8

"UK residents who receive dividends from foreign companies are, in most
cases, entitled to a tax credit equal to 1/9 of the dividend."

So the dividend paid is the same amount whether in an ISA or not. If not in an ISA there is a tax credit. For UK dividends this tax credit is explicitly stated on the dividend voucher, for foreign dividends such as from Guernsey the tax credit is still nonetheless claimed in the tax return, as the above suggests. So for non ISA dividends, regardless of whether from UK or Guernsey, I have no further tax to pay at basic rate.

I agree to avoid further OT discussion here it would be better to go elsewhere - there is a thread TAX which should help.

[asmodeus] 26/9/2014 21:18

Valhamos - or anyone else possibly still interested in gross-paying divs. in ISAs please see my updated 541. To avoid further OT discussion here - dose anyone know of a thread that discusses this subject - or perhaps ISAs in general?

[valhamos] 25/9/2014 22:18

jonwig

"the current NAV involves the likely payout from current cases, each weighted with its probability of being realised."

Yes I appreciate that. But it would be irrational to invest here on the basis that one was more optimistic than the company as regards these probabilities, hence the share price will trade around NAV - unless there is an expectation of the company taking on new investments. So judging by the share price there doesn't appear to be such an expectation - hence my reference to the comment about a "pipeline of investments".

For instance we know from the recent report that there will be additional investments, the amount being the difference between the gross and net proceeds less the US tax on legal settlements (In some ways it's a shame an estimate of the amount of tax could not be given so we could get an idea of the amount of new investment).

[eeza] 25/9/2014 19:23

Yes, Jonwig, agree with what you say. I was only putting forward a reason for the muted share price advance.

[jonwig] 25/9/2014 19:19

Valhalmos - the current NAV involves the likely payout from current cases, each weighted with its probability of being realised. (ARs give details.)

Once a case is settled and monies decided, the probability approaches 100% - ie. the NAV increases. Alternatively, they could lose a case, so the success chance is reduced to zero. (This has happened once.)

A concern is that new investments are limited to top-ups and the relatively small-scale of IPCreate business.

eeza - I don't think they can guarantee 20p, as appeals are still possible, and the exchange rate could do something odd.

[eeza] 25/9/2014 18:53

Price would probably have risen more if they had declared a dividend of 20p, instead of an intention to pay - maybe.

[valhamos] 25/9/2014 18:47

I guess the key question here is; are we merely looking forward to a return of little more than current NAV through dividends (which the current share price suggests) or are we expecting further significant gains that provide additional dividends?

The recent small investment in new cases indicates the former, yet in the Outlook section of the Investment Manager's Report in the H1 results there is this comment: "Our robust pipeline of investments presents excellent opportunities for growing the capital base and income of the Company." which gives a pointer that there is an expectation of more gains to come over the longer term.

[asmodeus] 24/9/2014 20:09

And that's me...

[valhamos] 24/9/2014 20:07

Not since the 2008/09 tax year for a basic rate payer.

[asmodeus] 24/9/2014 18:30

"For a standard rate tax payer in effect for dividends there is no difference between holding shares in an ISA or not."

So there's been no point, all these years, in my putting Guernsey-based shares that "pay divs. gross" in my ISA? !

[valhamos] 24/9/2014 17:50

asmodeus

For a standard rate tax payer in effect for dividends there is no difference between holding shares in an ISA or not. The dividends come with a notional, non-repayable, tax credit which where the shares are held outside of an ISA can be claimed to offset the tax due. Only a higher rate tax payer holding outside an ISA will have additional tax to pay.

This is true whether the dividend is from Guernsey or UK. As Jonwig points out the UK was forced by the EU to treat all EU dividends equally, which meant that shareholders in Guernsey companies are entitled to claim the same notional 10% tax credit as for UK companies.

[asmodeus] 24/9/2014 16:55

Thanks, Valhamos. I'll get to understand it one day. But it seems to boil down to if a standard-rate tax-payer has his shares in an ISA he has no tax liability, but he does if they are not. Edit - I have researched further, and found the following statements. The first from "Which" :"Dividends are automatically taxed (called 'taxed at source') at the rate of 10%. This is regardless of whether you choose to reinvest it or have the dividend paid in cash. The 10% deducted is called a tax credit.
Basic-rate taxpayers, you have no further tax to pay.
Non-taxpayers also have this tax deducted and can't claim it back. "

Note the words "have this tax deducted". I.e the dividend paid would have been higher it the tax had not been deducted. ! Dividends paid by offshore funds paid gross, have no tax deducted!

From another article:
"Dividends you receive from your shares carry a 10% tax credit. The tax credit is the amount of tax paid by the issuing company on the shareholder’s behalf – you receive your dividend net of this amount.

So, this still convinces me that dividends paid gross are approx. 10% higher in an ISA than those outside. I am going to put these points to Kenny if I can find him on the thread mentioned.

[valhamos] 24/9/2014 15:54

asmodeus

It may be worth pointing out that this was also discussed on the GLIF thread (post 894 onwards) where you commented on the ISA position. I think Kenny's explanation with the links provided is very useful.

[alter ego] 24/9/2014 15:48

one of a number of good reasons to stay in the EU!!
and/or put your JIL shares in your ISA!!

[jonwig] 24/9/2014 14:47

asmodeus, Valhalmos ... it's simple really if you follow this line;

Until 2009, international dividend taxation was a mess.
Then the EU issued a harmonising directive: basically if you receive a foreign dividend (ie. EU) with x% withholding tax, you pay that x% and then treat the resulting net amount exactly as a UK dividend - ie. with a notional tax credit.
Now the Guernsey withholding tax is zero, so, there you have it!

Two caveats here:

• a large number of other countries have signed up to this, apart from EU, eg. USA. However, these may have a withholding tax and they *may* redeem part of it to a UK investor. (Hard work to deal with, need W8-BEN in USA, for example.)

• outside an ISA, higher-rate taxpayers still have a requirement to pay more tax.

EDIT: one of a number of good reasons to stay in the EU!!

[asmodeus] 24/9/2014 14:17

Valhamos _ I have looked at the thread you mention, and the Post, and those that follow. Have also spoken to another person today who seems to know, and once again, my mind is boggled, as it appears that the tax credit does not mean that any tax has been deducted at all, and so there is no advantage in having dividends paid gross - contrary to what I have believed for years! Anyway, I guess this is off-topic, so will say no more.