Surface Transforms Share Discussion Threads

[amanitaangelicus] 08/11/2023 14:40

Woodworm? Old mine shaft more like. TW will be posting soon. Should be fun.

[geko5trade] 08/11/2023 13:26

In terms of share price just hit the long term support of 13 as predicted. Might provide something of a floor but with woodworm in the building I'll tread carefully...

[regandharry5] 08/11/2023 12:35

Haven't heard much from Pinkfoot yet, is he still confident.

[amanitaangelicus] 08/11/2023 12:16

Downtick? Numpty. Recovery play now. Wait for placing or T/ O interest for peanuts. Sooo sad. Still hope though. Placing, hire a German or 2, off we go ...simples.

[pugugly] 08/11/2023 12:14

Looking more and more like a potential low ball takeover target - Vulture cap or Bembo or possibly companies such as Melrose.

[amanitaangelicus] 08/11/2023 11:25

Execution defo. They.ve failed big time. Clowns. Expanded too fast - production methods couldnt cope, for what ever reason. Bottlenecks, untrained staff, pushing machines too hard, naff maintenance schedules - not stuck too, need i go on? If they.re serious, big placing, hire gd workers, train and pay em well , instead of overloading the system. Bet ya QC has gone the pan too. Watch for cancelled orders next. This will have spooked the mkt. Time is of the essence. Gulp. 8p placing or lower , sadly.

[fevertreeman] 08/11/2023 09:52

Ironically, the problem here is not a strategic blunder i.e.pouring money/time/effort into a cutting edge product that no one wants! They have OEMs lining up for it and a bulging order book. The fundamental issue here is one of execution, which one would think can be sorted out with the right personnel,systems,management control & funding.

Ignoring the share price for the moment (a big ask I know) but the first thing that needs to happen is to right the ship,admit that mistakes have been made,and rectify them. In the short term,

1. Chairman must fall on his sword or be fired. New chair should be more executive than non-executive i.e. on exec team's case
2. CEO's management scope sharply proscribed (oversight from new chair + NEDs) He clearly out of his depth re. process management& manufacturing
3. CFO & COO empowered to do whats necessary:
4. External shareholder relations overhauled
5. Secure the commercial loan & provide prtoper roadmap re financing after Bundred & Johnson wasted all our cash raise fixing the mess they made

Medium term issues I would suggest include:

1. Exploring strategic investors/JV ops
2. Relocation options
3. Proper people strategy

[sharesure] 08/11/2023 09:36

If they are out of pocket it just reinforces that they don’t seem to know how to run this business.

[albert_einstein] 08/11/2023 09:31

Not really, most of the senior management have participated in all of the previous fund raisings and so are well out of pocket now I would think.

[amanitaangelicus] 08/11/2023 08:59

Big placing, new management reqd. These useless thickwits have let us down. They.ve made loadsa wonga and will sail off into the sunset like all good Aim leaders do. No convertible death spirals. Big discount placing for me. 8p and timber. Sacrifice to succeed. Sell now. Wait, rebuy. Pretty darn clear to me.

[bones] 08/11/2023 08:58

NC, it is clear a short term financing solution of some kind is needed. The already tight year end cash target that Bundred kept reducing in £1M increments has been shot.

However, they say they need to finance working capital for the explosive growth over the next few years which suggests a longer term solution (in addition to the capital expenditure loan that they are working towards). That possibly points to getting a larger industrial partner in place to secure trading capacity (and not being taken over). That sort of thing was done by ITM Power a few years back when a big German group came in for 20% and injected a wad of cash and lent its industrial knowhow.

[nchanning] 08/11/2023 08:40

Need to just accept the dilution and do a big placing at a big discount . Better to have 66% of a well financed company under no financial stress than risk throwing everything away

[bones698] 08/11/2023 08:26

Hoping for a bid isn't sound investing . They rarely come and show pis are getting a bit desperate imo . If I had a quid for every share that expects a bid when things are not going well I'd be well off . Focus on sorting the business out that's the priority for investors not hopes of a bid at a low ball price . If they can sort it out then a possible bid in the future would be far more lucrative

[amanitaangelicus] 08/11/2023 08:23

Nothing wrong with the product. Just need to sort the bldy manufacturing basics, financing( gulp) and mkt sentiment out. Would never happen in Boschland. Low bid inbound?

[bones698] 08/11/2023 08:22

Amt whilst I get your point they are having a lot of issues ramping up production . Costa have overrun hence the need for financing and the faith in management is fast disappearing. Unfortunately what might happen in the future has been overtaken by issues now .

As for demand if they can't get the discs from sce they will just go elsewhere and that's the risk . If customers don't have faith that they can deliver consistently they won't risk doing business .

For now at least the negatives need to be addressed before confidence will recover . Possible management changes needed which will delay progress somewhat but may be better for the long term . Sentiment is key in small caps and any bad news will hurt .
If they can rectify the short term issues ,get funding sorted and sort management out , resolve production issues and communication issues then longer term will look a lot better . Until then though doubts remain and in what state the company will be in if it gets to the future .

Besides that the don't fight the trend ATM this is a falling knife ,hopefully with some support around 10p what news comes next will decide which way it goes from there imo

[someuwin] 08/11/2023 07:42

Zeus

08 November 2013

"Surface Transforms SCE LN - Automobiles and Parts

Forecasts & valuation suspended

We note the Regulatory News Service (RNS) announcement “Trading update” issued by Surface Transforms on 3 November 2023. We suspend our forecasts and valuation for the Company."

[amt] 08/11/2023 06:34

Let's get some perspective. They have a World class product that car manufacturers are falling over backwards to get hold of. They have gone from producing just a few brakes every month to a million pounds worth per month. The size of the market is 2 billion per annum.
If they can't get finance to develop this business then we might aswell give up on UK manufacturing new products. They should have based themselves in Germany or US in hindsight
The share price was 40p in 2020 when sales were 2m per annum, they forecast 2023 revenue of 8 million and an order book of a fraction of today's.
They have to some extent been a victim of their own success and Covid didn't help them get their manufacturing in place.

[bones698] 08/11/2023 00:55

Bones
Either of the things you suggest will take time to sort out at which point it may be too late as funding is required sooner than those allow for.
A new CEO and CFO will take some time to settle in and then have a funding issue to negotiate .
Going to an OEM asking for some cash whilst may be the least dilutive and damaging option doesn't look good to the manufacturer and would take many months to negotiate and get to the point of signing which carries risks if they pulled out and thought about getting the whole of sce on the cheap .

The negatives were provided by the last update but no solutions offered ,no coatings or time lines . Whilst there are so many questions and not enough answers this is going to come under increasing pressure share price wise . People won't believe vague answers only facts that things have been sorted and finances are dealt with . Anything else just creates more doubts. .

In the meantime while tha bove play out the chart tells you everything you need to know. The share price is heading lower and looks pretty dire at this point . I'll stick to my 10p target in the coming months and until news on the issues and funding come out.
All the smas are pointing downward and accelerating currently so in the absence of news the share price will follow them

[fevertreeman] 07/11/2023 14:58

Initial to-do list for Senior Independent Director (assuming big holders are as incensed & concerned as we all are):
1. Bundred goes asap as position no longer credible. New chair to have listed co. experience, preferably international manufacturing given SCE profile
2. Johnson stays but quid pro quo (1)new set of performance KPIs (2) monthly detailed reporting to Board (3) all ops decisions made with CFO & COO
3. Report prepped for Board as to why these issues weren't flagged at Interims...
4. Advisers brought firmly into fold to work on defence planning; strategic partnering; raising cash

[mr macgregor] 07/11/2023 13:09

Far from creating a vacuum, the directors have actively encouraged negative comments and have underperformed after two consecutive trading updates..

Mr MacGregor - 27 Sep 2023 - 12:57:50 - 7897 of 8290

You need to be Sherlock Holmes to work out the finances.

In the trading update of 31st July, Bundred said "gross cash at 31 December 2023 is now expected to be no worse than £1m lower than previous estimates".

Somewhat opaque, but quemaster neatly tidied it up in post 7751 "The Zeus note yesterday shows year end cash of £2.5m previously £3.4m" (ie. no worse than £1m below previous estimates).

Today Bundred said "Accordingly, year-end cash is expected to be within £1m of previous management estimates" (note similar wording to the trading update)

However pinkfoot2 in post 7873 kindly reports the projected year end gross cash at £1.4m.

In summary, it looks like Bundred has tried to play clever using the same language while referring to two different estimates without clarifying that. The forecast year end cash position is therefore £1m worse than I expected from the trading update.

[bones] 07/11/2023 13:00

It’s for the company to be more specific about things. They have created a vacuum for negative comments to flourish and that helps nobody. I suspect the new brooms have swept through the building and worked out what is realistic and what was hubris in past announcements and guidance given to brokers. At the point of deciding what is likely the the worst case, the new team have had no choice but to update the market, this time hopefully with targets that have a hope of being surpassed with a fair wind.

At the moment, that means there is uncertainty about how short term working capital is to be funded. A good business with prospects should be able to find a way to do that but shareholders may be unwilling to be the fall guys this time. I am sure there will be heated discussions with the big holders this week.

As pinkfoot has suggested, the company should actively seek a well-heeled industrial partner to take things forward with them. Better for everyone to share in a slice of a big pie than risk dropping a complete small pie on the floor before taking a bite of it!

[mr macgregor] 07/11/2023 11:55

Shareholders are in the front line as their hard earned cash is at risk. Their lack of confidence in the ability of Bundred and Johnson to deliver vital production ramps, quantified by the share price performance, will be heeded and acted upon by customers without change at the top. New management comes with risk but I see no alternative here. Signed up OEMs must be wondering if they backed the wrong horse.

[amanitaangelicus] 07/11/2023 11:46

Market just doesnt trust Surface ...gonna take time and maybe a mega ,say quarterly update, to prove they.ve sorted their amateurish shipshow out. It.s doable, bit proof of the pudding is reqd. I hope too they.ve got some sane safety clauses in their new business deals. Gonna be some frustrated companies ( chumps) out there who.ll feel like they were taken for a ride. New business will probably drop off. We re a recovery play now. Big buy order waiting. Load em up cowboys. I.m on it.