SeaDragon

[Apathy]

27 August 2014

SeaDragon signs new working capital facilities; new factory progresses

New Zealand’s largest refiner and blender of high-quality fish oils, SeaDragon, has
agreed on a new $3 million working capital facility.

The facility is to be used to fund raw materials secured under the supply agreement for
its existing plant announced in March. Under that agreement, SeaDragon has contracted to
buy raw material more than sufficient to cover squalene production budgeted for the 2015
financial year and beyond.

SeaDragon Chief Executive Ross Keeley said: “This facility highlights SeaDragon’s strong
position. It recognises the strong demand for our products. It also recognises the
security provided by the two squalene sales contracts announced in May and June.

.

Anyone think it strange that there is a price sensitive press release to announce that they have the working capital facility to fund the purchases they committed to 5 months ago (another price sensitive press release)? Does this release mean they didn't have the facility to purchase at the time they committed? Now that would have been a genuine price sensitive press release!

[NT001]

This announcement of major strengthening of the management would certainly seem to signify high hopes of big increases in revenue - the question is how soon. The salaries have got to come from somewhere, and it will take a little while obviously for everyone to slot in to these jobs.

https://www.nzx.com/companies/SEA/announcements/255953

[NT001]

Looking reasonably good, I'd say

https://www.nzx.com/companies/SEA/announcements/256192

[Dentie]

Looking reasonably good, I'd say

https://www.nzx.com/companies/SEA/announcements/256192

I'd agree with you NT. Barring unexpected headwinds, I would expect this firm is going to do well - especially after June next year.

[Harvey Specter]

Furthermore, sales for the month of September were $1.055m, a record for any one month for the company and an indication of the existing plant’s potential when sufficient raw material can be sourced

I assume from this quote that they dont have enough raw material to earn $12m next year?

THat is nearly 50% of 1/2 a years revenue in one month.

[Dentie]

I assume from this quote that they dont have enough raw material to earn $12m next year?

THat is nearly 50% of 1/2 a years revenue in one month.

And a bit further down ...

“Our squalene operation is now delivering on its strong potential. New raw material supply agreements secured earlier this year enhance the likelihood of this performance continuing into the second half of the year and into the future".

Let's hope the suppliers can deliver on their agreements ...

[Apathy]

Let's hope the suppliers can deliver on their agreements ...

Supply was due in August and October so am sure that we would have had a price sensitive press release notifying us if there were any issues!?

Its a rubbish release - putting top line out with no bottomline information. Will be interested to see if they have been able to improve on last years $600k loss for half year (excluding Snakk)

[Dentie]

Supply was due in August and October so am sure that we would have had a price sensitive press release notifying us if there were any issues!?

Its a rubbish release - putting top line out with no bottomline information. Will be interested to see if they have been able to improve on last years $600k loss for half year (excluding Snakk)

I am happy to see the revenue up 17% on last year but you're right Apathy - let's just hope the outgoings didn't rise more than 16%. Based on the info provided though ...this firm is going forward - which is more than some others are doing!

[blah]

Supply was due in August and October so am sure that we would have had a price sensitive press release notifying us if there were any issues!?

Its a rubbish release - putting top line out with no bottomline information. Will be interested to see if they have been able to improve on last years $600k loss for half year (excluding Snakk)

Not disagreeing with you, but you seem quite fixated at announcements being 'price sensitive'. Most people agree that NZX's classification of price sensitivity of an announcement typically carries no practical meaning.

[Apathy]

I am happy to see the revenue up 17% on last year but you're right Apathy - let's just hope the outgoings didn't rise more than 16%. Based on the info provided though ...this firm is going forward - which is more than some others are doing!

I pretty sure you won't be happy if what you wish for comes to fruition.... if costs go up by 16% the loss will go from $582k to $650k as you need to remember now more Snakk shares and last years result was propped up by $801k of margin on the disposal of shares. They will lose $200k if costs don't move at all... clearly forward comes with a - sign for you?