Surface Transforms Share Discussion Threads

[amanitaangelicus] 15/2/2024 17:52

What I dont understand, is why so many allegedly intelligent investors, some with OEM linked experience, held onto their shares during the stellar fall. Too much love. Bias confirmed. Couldnt take a loss. Many here are submerged no doubt.

[damayhill] 15/2/2024 15:07

rivaldo, you're absolutely right (though £32m rather than £22m) and as you know the market cap was previously almost three times that on a substantially lower order book. The decline since has been all about ability to ramp up production and some sub-optimal handling of the most recent raise.

But if they can continue to demonstrate ramp-up and achieve the £20m+ this year, I see little reason why we couldn't get back to the same levels, even within the next 12 months. That would equate to a share price of around 24-26p, which I currently have as my best case scenario for YE24.

[pinkfoot2] 15/2/2024 10:36

My recent experience with OEMs is that they like local supply-covid exposed global supply chains.But that is for the medium term.Just now, I’m sure the contracted volume is from Liverpool

As for the constant berating of the team, I think they have addressed the weaknesses so let’s get behind them

[fevertreeman] 15/2/2024 09:50

Bones,

Not a grudge against Holly Johnson, just anger/disbelief at the way he/Bundred misled investors in Sept at interims. Plus the grant of share options which explains why he has yet to put up any serious cash of his own....that's for another day.

Yes you are totally right about the US OEM market - the idea SCE can export long-term from Knowsley, with the shipping costs/exchange rate issues is not credible. The trouble is that management's operational performance to date has been so inept, that the idea of John sitting in Juarez pouring over blueprints etc doesnt fill me with anything but horror.

Ultimately, if they can more orders on board, and prove they can handle the ramp up then I do not see Johnson & Maddocks wanting to do anything but get the hell out of Dodge by cashing in their chips, unless they end up with a big strategic investor like a Tesla/Ford. Otherwise suitors aplenty: carbon specialists like SGL or Morgan; auto players like Bosch(privately owned); engineering conglomerates ;or dearol private equity.

[amanitaangelicus] 15/2/2024 08:50

Mad order book to mkt cap / share price Looks like the bargain of the century.

[bones] 15/2/2024 08:36

Lol, fevertree.

It could only happen once Knowsley has proved itself. The Johnson issue (grudge?) will be distant history by then should it all come to pass.

It’s a serious point though. It sounds like the future customer base will be mainly US based, so a Mexican factory is decent odds in any long term strategy planning. That’s if some US predator hasn’t already seen the value and bought SCE out for a bargain from the value-blind Brits.

[rivaldo] 15/2/2024 08:31

Hopefully yesterday's move up and the early tick up this morning is indicative that any large sellers are now out.

The £22m m/cap here is truly ludicrous when compared to a zillion other companies on the market - there are companies with virtually zero or little revenues who are valued at far more!

[amt] 14/2/2024 22:47

Well Bones you are off to a flyer vs my Bango. However I think tomorrow will be a good day for Bango not sure about SCE but it's a competition I would quite happily loose if SCE shoots up a lot. I need 28p to break even after the latest fiasco.

[fevertreeman] 14/2/2024 22:31

Jeez be careful what you wish for! Given Johnson has shown a complete inability to manage the assets on the ground in Knowsley, I'd lay seriously long odds he would be capable of managing a bunch of Mexicans!

[fevertreeman] 14/2/2024 22:28

Jeez be careful what you wish for! Given Johnson has shown a complete inability to manage the assets on the ground in Knowsley, I'd lay seriously long odds he would be capable of managing a bunch of Mexicans!

[bones] 14/2/2024 20:41

Moving on……R30;…

Here’s a little snippet from a Bloomberg email I subscribe to:

“Chinese auto-parts makers are joining the wave of companies setting up shop in Mexico, aiming to help Tesla and others manufacture vehicles headed for the US market.”

fft (post 9132) earlier talked about Tesla and GM deciding where they would like their parts made so maybe a subsidiary in Mexico will be the next stage after Knowsley is fully up and running. It will spread risk to have separate locations serving the main markets (especially the US).

[supernumerary] 14/2/2024 20:37

It's bizarre - in the days when I had to correct that sort of stuff I'd have just red-penned the whole thing with my usual kindly 'rewrite more clearly' comment. You obviously had a more forgiving editor; or maybe you were no more capable of learning then than now?

'Really just not fair'??? I don't know what you're on about, which means you don't either. See previous para.

As I said, grow up and get over it. In the meanwhile, remember that clarity of thought, clarity of expression, and hard facts are key to an effective argument. If you need help, Orwell is good on the subject:

You started the 'conversation' with an incorrect and ill-mannered post. Good to hear you're backing away from it.

[damayhill] 14/2/2024 20:19

Umm, yes, that's pretty straightforward English, although you've chosen to omit the really key part of the sentence, naturally! The fact that you understand neither the sentence nor the concept behind it makes things an awful lot clearer to me, thank you.

Perhaps stick to comments about how it's really just not fair for the little guys, right, that the industry chooses not to publicise suppliers, right. But if we all club together and close our eyes tight and wish really hard, maybe we can change that, right?

Done with this conversation.

[fillspectre] 14/2/2024 19:53

@ quemaster - thanks for the friendly welcome back post. Like I said I have never been away - just sitting on my hands dismayed in the background. @ Pinkfoot2 - I resumed posting to keep you company :-)
On a discussive note. Anyone venture a Company valuation at 3.34p to 4p EBITDA? Remembering we have 352 million shares now. Yes I have been rereading the LTIP RNS announcement. Fils

[supernumerary] 14/2/2024 19:43

damay - you've been wrong every discussion. Making snide comments in your earlier post, and completely incomprehensible ones (eg 'I believe it would be preferential to shareholders if they were not in a position to announce a new meaningful contract' - is that even English?) in this one change nothing.

Grow up and get over it.

[bagpuss67] 14/2/2024 18:33

I believe they will announce Q1 sales in early April and the results in mid-April.

[damayhill] 14/2/2024 18:19

Oh please, supernumerary, let's not go down that cul-de-sac again. Of course they must announce a contract whenever it is agreed. Facile point.

I have been clear numerous times (and for some reason you choose to wilfully ignore it) that I believe it would be preferential to shareholders if they were not in a position to announce a new meaningful contract until after a positive April TU because beforehand it will have no impact on share price whilst concerns about manufacturing ramp-up continue, whereas afterwards it would have a potential amplification effect.

I'm not sure which part of that you continue to struggle to understand?

The fact is you embarrassed yourself horribly on here a few weeks ago and since then you have directed your embarrassment towards me, for reasons best known to yourself. Let's just remind ourselves of that absolute belter, which demonstrates your expert grasp on the automotive industry:

'If it's the industry standard not to name suppliers, that's understandable because they're all big companies who don't need the day-to-day support, but tiddlers like sce do, and it's up to them to negotiate contracts that allow reasonable publicity. Why does everybody seem to accept that the status quo cannot be changed? If managers can't do that, then they're not doing their jobs.'

[damayhill] 14/2/2024 16:45

Yes bones, could be the remainder of the R Gledhill change of arrangements previously RNS'd or did all of that already happen?

[bones] 14/2/2024 16:44

Pinkfoot, agreed! There’s only so many hundreds of ways of saying the management are unfit. Think that point has been forcefully made so I hope they can now execute the plan. The past cannot be changed, it’s the future that matters.

[bones] 14/2/2024 16:40

Looks like a bloc of 2.2M shares changed hands and/or got moved between accounts. Hence multiple appearances of one identical amount. With luck, the seller is out.

Damayhill, I agree with you on your scenarios. The quicker the company utilises its capital facility (not being a draw on working cash) to build out resilience and capacity, the better for all concerned. That is certainly what they have stated to be the intention following receipt of the loan.

[pinkfoot2] 14/2/2024 16:40

Anybody else bored with negativity on here?

Let’s focus on the positives-a £400m order book at 60pc margin.If all else fails, the value is underpinned by a trade sale

[amanitaangelicus] 14/2/2024 16:36

Seller cleared - you.d think- hindsight is a wonderful thing.

[damayhill] 14/2/2024 16:20

To which point - on the things that matter - here is a reminder of what I believe we need to be looking for in seven weeks or so in the April TU:

Ideal scenario - confirmed sales in a £3.9-£4.2M range, with positive but measured language around continued ramp up and no major technical problems or future capacity hold-ups. Possible bounce to 12-13p and slightly decreased chance of further raise, pending H1 TU. If the number begins with a 4, I'll be delighted. Not necessarily expecting it to, but that actually could be a bit of a psychological boost.

Acceptable scenario - £3.6m-£3.9m and as above. I wouldn't expect any share price action because further raise is still very much in the balance until H1 update. I would think this is the likeliest range.

Unacceptable scenario - under £3.6m and/or either of the above. This is the scenario in which I think a further raise becomes more likely on the basis that ramp-up is not happening quickly enough for the cash we have.

[damayhill] 14/2/2024 13:47

Just reading contributions over the past few days. bones, I'm very much in the same camp as you I think. There's a lot of gloom on here based on a further downward trajectory of share price which itself would appear to be based on a single seller (probably ii). We don't know who it is or why it is. For example, it could be a general distressed seller for all we know.

The most important thing has not changed at all. That is, what is the answer to the question of Q1 sales value and therefore the increased or decreased likelihood of any further raise? We don't know. And we won't know until April. IF (and I accept it's a decent-sized if) April's TU continues to demonstrate a rate of ramp-up that retains realism around forecast for the year and which itself would demonstrate significant further growth and if this is then followed by a further decent contract announcement, some people on here could begin to look a bit silly because at that point - and particularly at H1 point if the positive trajectory continued - we would again align quality of product, health of order book, manufacturing capability/capacity, and duopolistic market, a combination which could and should have people taking a serious look at this market cap.

I continue to hope (much as one poster struggles to comprehend this) that any new contract announcement comes after a positive April TU, because at present a contract announcement would have zero impact, whereas after the TU it would enhance.

I feel that quite a number of the posters on here have perfectly fair emotional sentiment, but have got the wrong end of the stick in terms of what actually matters. For those who have seen The Traitors, it's a bit like people basing their suspicions on whether they like somebody or not, which might be human nature but is entirely irrelevant.

I'm not saying everything will be alright. I'm saying focus on the things that will actually determine how this plays out.