IntelliAM aiming for significant growth with £5 million Aquis IPO. Watch the video here.
hi FK - these days it is all algorithms that move the SP and it is based on more than just the number of buys and sells - and in truth ive seen dekel fall 10% + on the back of a few £00 worth of sells.
results, price of CPO, macro factors such as some of the outlined below by PV - will all be factored in and on top of that there is generally something factored in around momentum of a stock.
the day to day movemets never make a great deal of sense - think we are though seeing a solid biull case forming on a number of fronts now so long may it continue - I know we have all been here before but the longer DKL keep producing the results the more people will by into the story we bought into 5 years ago!
that's an interesting read - the suggestion seems to be that going into next year IOI's financial performance will hold up due to the CPO price - production though will be restricted due to ongoing operational challenges from Covid, gov't policy on foreign workers an fact that production out to middle of Q1 next year will be low (due to it being low season obv).
For DKL this is a bit of a perfect storm - DKL operations have not been impacted too badly, demand is coming back strongly and above scenarios should all keep the CPO price high well into next year!
if that all happens and we execute on Cashew business we could be smiling!
I don't think high season is that rigidly defined tbh - seems to be it starts roughly around middle of Q1, ends at back end of Q2 and peaks somewhere in the middle - April, May.
In fairness to DKL at moment I have to say I think they are doing what we'd hope they would do - for past couple of qtrs now results seem solid, there are regular updates as promised and progress on cashew project has kept to plan (other than a perfectly reasonable delay on back of Covid) - alongside the much improved CPO price can't ask for much more IMO.
For any new DKL buyers or those new to the board - if you notice there are some of us on here than can occasionally be viewed as glass half empty / always skeptical it is simply because we have been here a long time with high expectations and ambitions that have never quite come through (often with some frustration around the DKL leadership!)
on the plus side you get an honest assessment on this board from individuals who I think seem to really know their stuff!
DKL looking good (and very cheap!) at the moment so ill try and stay positive - a nice Q4 would help! - maybe the dividend will return! - (ok I should calm down again!!)
hi Picklingvinegar
I picked it up from Rivaldo's post below which outlined - in 12 months' time, with the cashew plant up to speed, annualised group revenues should be up to €50m, with high single-digit EBITDA margins, i.e say €4m-€4.5m.
I was assuming this was a reference to high single digits margin % - this would be 9% at best and 9% of E50M would be E4.5m as per Rivaldo's post
however you may be correct and the high single digit margin references the absolute margin as opposed to margin % - this would make a lot more sense if we are expecting circa E9m in EBITDA - and would make sense with addition of Cashew business!
I think you may of solved it Picklingvinegar - I must learn not to overcomplicate things! I think that must be it so do feel more confident now - thanks PV
Thanks Cat - ill maybe look in some more detail also if get time.
It doesn't stack up though does it? - Palm oil operation is relatively straight forward - bunch of fixed costs with the key drivers of margin being
- sale price of palm oil and other products
- cost price we need to give to smallholders
- EBITDA will then also be influenced by Interest, tax and depreciation charges
based on what we are told for next year the top 2 should improve to support margin (ill ignore fact that cashew business should help even further) - so it can only be a significant uplift in the interest, tax and depreciation that causes a huge drop in margin/EBITDA - which I do not buy!
unless some other costs have significantly increased to reduce margin- Director salaries etc!!
anyhow - ill leave it there - it doesn't add up though (ill perhaps message DKL and see if get a response) - we should be doing way better than E4.5m EBITDA.
hi FK - increased production should improve margin really, fixed costs would be a lower % of revenue and I would expect the margin on FFBs to be fairly standard i.e. whatever the spot price is we pay local smallholders less a premium (if anything increased volumes may also help margin here too if DKL has any sort of volume discount tiering in place)
if my analysis is right then it should be put to Lincoln for an explanation if anyone has a good relationship and can elicit a response.
Thanks Rugs - that does though mean issue remains with the numbers, CPO prices for next year I think are forecast to be higher than both of those numbers (currently are above/or around E680)
I do not get how the EBITDA remains at E4.5m (same as 2017) even after significant improvement to palm oil operations and onboard of Cashew business.
For that to be case (assuming I am correct) something must have materially impacted margin.
ok ignore that last one - calculation errors, its not that extreme
however - base on the same metrics as 2016/17 we should have EBITDA of circa £7.5m - which is still significantly above the predicted £4.5 and not allowing for the fact that Cashews have better margin?
it could be the CPO price was so much better in 2016/17 - not sure if that correct or not.
PS - also based on metrics of 2016/17 profit would be £2.5m - so a low PE of 10 would mean over a doubling of current price! (not quite a nice as the error calculation - I liked that version!)
if the metrics were anything like that achieved in 2016 and 2017 then on £50m of revenue we'd have around £30m EBITDA and net profit of £20m (double current market cap) - seriously happy days!
I'm sure I am missing something very obvious.
i still do not really understand the numbers if i'm honest - if you check the financial statements from our better years in 2016 and 2017 we had revenues of 26.6m and 30.2m with EBITDA of 4.1M and £4.5m - the prediction seems to be a similar level of EBITDA for the group once we have the Cashew's up a running.
this is basically because it seems a group margin prediction of high single digits is way below what we were achieving back in 2016 and 2017 on Palm oil only?
doesn't make sense that palm oil prices are going up and cashews are higher margin - yet our group margin has significantly declined from 2016/17 and the absolute margin numbers seem no better than 2016/17.
I am likely missing something - if anyone is able to shed any light would be appreciated (is it because our interest payment on loans are so much higher? - again though I thought we renegotiated these on better terms)
yes well at some point I suppose you have to put it down to the good old 'we are where we are' and be a little wiser going forward and look at the positives.
I love that phrase - 'we are where we are' - generally it really means 'we are (still) where we were'!
maybe a question for the investor presentation
can you please explain how the current price forecast is circa 70% plus below the price forecasts of 4-5 years ago - given the multi year operation of the palm oil operation and the development of the cashew business (which wasn't even in existence then!) - how much confidence do you think this huge variation gives to shareholders in the current forecasts!
thanks JK - yes, I also found this one with talk of a full year of production in 2014 and a price target of 21p (or 34p unrisked - whatever that means)
https://www.proactiveinvestors.co.uk/companies/news/47862
I know that they need to sell this project etc but to get it so wrong over such a long period is a huge frustration! - there's a fine line between selling and blatant BS!
I hope this one turns out to be more realistic - definitely in the camp of ' ill believe it when I see it'
lots of positive news - however it was only a few years ago we had lots of price targets at 20p +
does anyone still have a link or access to any of those broker reports and price targets - id love to see how they were justifying 20p plus - whereas now we are looking at 7.5p - and that's after onboarding a second commodity?
doesn't seem to make sense to have such a wide valuation discrepancy - and the price evaluation must surely be independent of the current price! - or perhaps that's what im missing - paid research will get the broker to forecast a price the company paying the bills wants them to forecast!!!
agree with the positive sentiment here, progress and future opportunities do look promising! I particularly like the sound of the solar energy opportunity that was referenced in the Arden research. id quite like to get into renewable energy as think will be huge growth market!
Before getting too carried away thought I agree with the comments below - lets see some sustained positive progress in the quarterly, half year and annual updates - some sustained execution will certainly improved the confidence and sentiment to some of the posters on here (myself included)
GLA!!
this comment from the update also made me smile
'September 2020 is expected to see a continuation of the recent trend of improving year on year financial metrics.'
year on year would not be a recent trend - and also i'm not sure we have every yet seen a year on year improvement!
Dekel - if your listening - a year on year improvement in my book would be a bare minimum of 3 years consistent improvement across a range of metrics - not this year potentially looks a bit better than last year because CPO prices have risen significantly (its not like you can even claim any glory for that as CPO prices you have no control over!)
ahhh here we have it again - the periodic partially positive update from Dekel, heavily laced with plenty of 'jam tomorrow' promises!
i read the comments from the long term holders on here with a smile - what a cynical bunch we have become, and im right there too! - you did this to us Dekel!!! you did this!