React Energy Share Discussion Threads

[ryan83] 26/8/2015 09:18

sorry for my lap dog Trout. Looking good for you here!

[troutisout] 26/8/2015 09:17

This is the REAC thread, can we keep it to that!

[the stigologist] 26/8/2015 09:15

lol how brazen

yesterday he claimed he was 'happy to wait' today he claims he dumped without telling anyone



A new start but will what comes next FLY? - FBDU

ryan83 - 25 Aug 2015 - 14:26:15 - 28 of 42

the announcement of the deal is what we are waiting for yep. Happy to wait


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ryan83 26 Aug'15 - 09:13 - 190 of 191 0 0

FBDU was a good trade cheers. Buy low sell high, thats how you trade stig

[the stigologist] 26/8/2015 09:13

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 15:47:31 - 34 of 42
never mind stig

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 15:37:15 - 30 of 42
well 5 projects they have looked at, they have the contacts

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 14:26:15 - 28 of 42
the announcement of the deal is what we are waiting for yep. Happy to wait

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 13:20:06 - 24 of 42
Guess we will find out soon enough

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 13:10:13 - 22 of 42
Eagle - that's why I'm here. The current BOD are good at RTO's

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 12:54:56 - 20 of 42
I take it you are then clock tower ;-)

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 12:31:16 - 17 of 42
Trevor Brown says you should lol

A new start but will what comes next FLY? - FBDU
clocktower - 25 Aug 2015 - 12:30:48 - 16 of 42
Do you think I should be ryan83? :-)

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 12:19:12 - 15 of 42
hey clocktower. You invested here?

A new start but will what comes next FLY? - FBDU
ryan83 - 25 Aug 2015 - 11:56:26 - 13 of 42
lol

[ryan83] 26/8/2015 09:13

not in here. FBDU was a good trade cheers. Buy low sell high, thats how you trade stig, not spent 24 hours a day pointlessly following people round on internet boards! something really bad must of happened to you to make you so bitter!

[the stigologist] 26/8/2015 09:11

are you trying to buy and pump this now ryantard after your attempted FBDU pump failed ?

[ryan83] 26/8/2015 09:07

doesnt seem theres much stock around now!

[troutisout] 26/8/2015 08:47

The important thing with this is the 1.9 ROC qualification and that is why pension funds want to get involved with funding the repowering.


Company: Newry Biomass Limited
Registered Office: 68 Cloghanramer Road, Carnmeen, Newry Co. Down Northern Ireland.
Shareholders:
Newry Biomass No. 1 Limited 50.02%
Farmer Business Developments plc 49.98%
Issued share capital:
Newry Biomass No. 1 Limited 1002 ordinary shares
Farmer Business Developments plc 1001 ordinary shares
Date formed: 28 August 2008
Domicile: Newry, Co. Down Northern Ireland
COMI: Cork, Ireland
Purpose of SPV: Formed to build, own and operate a Biomass Combined Heat and Power (CHP) plant using advanced conversion technologies such as gasification of wood and wood waste converting them into electricity and heat.
Requirements to achieve purpose:
• Site
• Planning & permitting
• Building and infrastructure
• Conversion technology
• Grid connection
• Feedstock or fuel such as wood
• Off-take or Power Purchase Agreement
• Human resources
• Funding to achieve all of the above
Estimated % of project achieved: Project has been commissioned and has exported electricity to the grid. However problems with the conversion technology chosen, which resulted in insufficient economic return led to a decision to repower the plant using a different technology.
Landmarks expected to completion:
• Replacement technology decision (now down to 2 options)
• Funding package put in place for repowering (discussions already at an advanced stage with a number of parties including the technology providers)
Detailed expenditure to date: The SPV has already spent £11.7 million to date on getting the project to the initial exportation of electricity. This was expended on
• development costs including planning and permitting,
• construction and civil costs,
• mechanical and electrical costs,
• equipment costs,
• grid connection costs, and
• legal and other professional costs
Provided against expenditure to date: An impairment charge of £7.7 million has been made against the carrying value of the asset.
Carried NBV in 2014 audited accounts: The written down carrying value stands at £4.0 million
Cashflow forecast to landmarks:
These numbers are based on deploying the EQTEC technology to repower the plant at 4MW output.
• Capital cost to repower £8m
• Financed by £4m equity with 15% IRR and £4m Debt with 10% coupon and 8 year term
Expected funding sources:
• EcoFinance and Altair
• Technology provider
• Equipment finance from suppliers such as GE
• Third party debt and equity providers
Discussions have already taken place with technology and equipment providers in relation to funding and with third party funders with who REACT Energy has existing relationships.
Long term expectations: The expectation is that in light of advanced discussions having already taken place with technology and finance providers the plant can be repowered to 4MW output within 12 months. The longer term plan includes using the existing grid connection and permitting to double this output to 12MW. The expectation is that new finance providers and existing shareholders get a return on their investment.
Projected cashflows:
These numbers are based on deploying the EQTEC technology to repower the plant at 4MW output.
• Project Turnover £4m and EBITDA or Net Operating Profit £2M
• Cash Flow from project
 Pays all debt £4m and interest in 8 years with ADSCR of 3.13
 New Equity gets 50% of project generating 15% IRR
 Original equity of £12m on Phase 1 and £4m equity for repowering could be paid back by Year 10
Possible IRR% based on successful final outcome:
The estimated project leveraged IRR is 15%
Executive summary: Newry Biomass is a 4MW Biomass advanced gasification project located in Newry, Co. Down, Northern Ireland. The project is a joint venture with Farmer Business Development plc REACT Energy’s main shareholder.
Planning permission for waste to energy plant converting 25,000 tonnes per annum of Virgin Wood received in May 2009. The project qualified for 1.9 ROC’s under the advanced gasification banding level which is a financial support mechanism employed by the UK government for clean technologies. The project cost Stg£11.7m to construct and has been funded through shareholder equity and loans. REACT Energy plc invested Stg£5.75m and currently retains 49.11% of the economic benefit of the project whilst Farmers Business Development plc has 50.89%.
Due to underperformance of the original gasification technology a decision has been made to repower the project with a new technology. The project is currently on ‘care and maintenance’ programme pending additional funding required to engage a new technology provider.
There has been much interest from parties including technology providers and pension funds that have expressed strong interest in being part of the repowering of the plant from a finance and technology deployment perspective. The opportunity of strong investment returns and positive commercial return from being involved in the repowering of the plant has attracted strong and sustained interest.

[timbo] 25/8/2015 17:11

apfindley - 25 Aug 2015 - 15:58 - 184 of 184 - 0Clearly it's being pumped by the organised pumping crew.Not with you - what organised pumping crew?

[apfindley] 25/8/2015 15:58

Is there any reason for this rise?I expect you will get an rns soon knowing no reason for price rise Clearly it's being pumped by the organised pumping crew.

[troutisout] 25/8/2015 15:00

Hi Timbo, well done.

I had a quote to buy 50k at 4.9p several times this morning but didn't press the button instead posting more thoughts. Oh well missed some fun here while away from screen.

I had a quote to buy 150k of these earlier at 4.9p so you can see how very little trade moves this lots.

Looks like a few others bought in too.

This is still very cheap with lots of irons in lots of fires, not all will come to fruition, but enough spread of risk to move forward. Just think with EcoFinance, Altair, Equitix, FBD and EBIOSS we have finance readily available to concentrate on all aspects of the business. if they had concentrated on the wind turbines first they would have a revenue stream coming in. That is what they have to do now, concentrate on getting revenues streams on tap, no good having a portfolio of projects when only a few are actually generating revenues.

DYOR,

Trout.

[timbo] 25/8/2015 14:19

I did, I really did ;-)

[ryan83] 25/8/2015 14:18

you moved it timbo lol

[timbo] 25/8/2015 13:53

I'm not far from Newry and Pluckanes this week so might just have a look in passing...

[timbo] 25/8/2015 13:51

Just taken a couple more nibbles to average down. Thanks for your thorough analysis of REAC Trout. As an accountant I've tried to digest all the RNS releases and reports but I keep getting interrupted and it needs quite a while to track all the minority interests and deferred payments etc. So I applaud your stamina!

[troutisout] 25/8/2015 11:58

Ryan,

There is a lot of information that needs to be looked at and researched. It doesn't really matter what I think it is worth, the share is so illiquid that the share price can jump or drop dramatically on very little trade, so I don't take the current market valuation to be the correct one.
All Companies were written down in the results before coming out of the examinership so there is a huge potential to increase NAV figures as REAC progresses.

The shareholder base is full of creditors that would like to see at least 11p and also new financiers buying in or converting at 10 and 11p. So that seems a good starting place. Most of these are locked in from selling for 12 months so any drag is limited at the moment. The only thing is how many other shareholders want to exit, but the register shows 310 separate shareholders or nominees on it, many look to be 'friends and family', this stock flies so far under the radar Joe Public doesn't know about it.

The other game changers will be the larger Biomass projects Newry has all permissions, as does Enfield (although at the moment we aren't part of that), Clay Cross due soon and Plymouth struggling against local sentiment.

Interesting to see comments about late stage talks by Grass Roots to authorities and pension funds to set up a portfolio of small CHP projects for care homes and hospitals, that could be a huge positive.

All the parts have real potential but they lacked financial backing with Enfield and Newry bleeding the Company dry, having wiped out 5.7m of debt with an equity swap and attracted new finance partners maybe we can see these parts of the company flourish.

MY own feel is that Grass Door and the Irish wind turbines are worth approximately £3m each and add in the £900k cash could easily substantiate an share price of 11p and subsequent valuation.

Newry, possible Enfield free carry and Clay Cross don't feature in the above but will do if things do start to look positive.

DYOR,

Trout.

[troutisout] 25/8/2015 11:42

They have just sent £500k to get through the examinership quickly to keep the AIM listing, so the owners believe the listing is of great value as well.

[troutisout] 25/8/2015 11:41

React has £900k in cash, having paid off the examinership expenses.

[troutisout] 25/8/2015 11:40

Wind turbines in Ireland,

React have one turbine up and running Pluckanes and 8 more with planning permission (2 of which have had wind masts up for over 12 months and have all the results and permissions to be 'build ready').

These 8 are all for 0.5MW (Pluckanes is 0.8MW)

Pluckanes gives us €130k of Net Operating Profit pa. and each of the other 8 turbines are forecast to give similar. so £900k NOP pa. once all built.
That would also give us a portfolio of 4.8 MW of wind turbines.

Even at planning permission stage the 8 would be valued at between €0.4 and €0.7m per MW. Under construction €1m per MW and up and running €1.7m per MW.

So at base case now, 4MW x €0.4m + 0.8MW x €1.7m = €3.96m or just over £3m

[troutisout] 25/8/2015 11:23

Ryan, maybe more jam, but this time it maybe a little different. Up to now the management don't seem to have delivered but also they have been hamstrung by finances and also the Enfield and Newry problems, Enfield getting to financial close while having to guarantee ludicrous rents and Newry the gasifier system. These two have now been resolved or at least a line drawn under them.
Enfield has planning permission and grid offtake agreements in the name of Enfield Biomass. REACT spent over £2.5m getting it to where it is now and it is hoped that these agreements as IP are worth something to Foresight and that these can be used to give us a free carry on the project. If this happens this will be a positive out of a big mess. Foresight or their vehicle now are holders of REAC due to the rent arrears being turned into equity here.

Newry needed a new system and I believe they will go to the EQtec system from EBIOSS, EBIOSS may also want to be involved with funding the project. I see this progressing soon as Farmers are now 51% owners of Newry and they have put in €5.7m as well as loans to the company now converted into shares.

Remember all our creditors now have a vested interest in the share price rising as they are now equity holders. Also remember they agreed to accept equity at 11p a share and not 4p, so they will want to see appreciation in the share price

Finally we have now got some financial backers and they will want to drive the Company on far more than previous Directors.

[ryan83] 25/8/2015 11:15

so trout, whats your valuation on REAC now? so much info to digest here isnt there.

[troutisout] 25/8/2015 11:13

Grass Door bought GGES for £2.3m with a further £1.7m in deferred consideration,

What do we have now?

3 working projects, all with a 30% equity share (70% owned by Equitix). These total of 1.6MW of power generation that is currently up and running.

There are 5 other projects in the pipeline that are to be developed in the short term. These will need £80k of staff time from Grass Door and will on completion return £100k of development fees and £50k annually of Management fees.

Say an average of 500KW per project, we are talking about just over 4MW of generation. The good thing here is the projects are already funded by the Equitix funding line, which has £3m left.

This would give us a 30% stake in something with a build and development cost of around £5.5m invested in them.

[ryan83] 25/8/2015 10:48

more jam lol?