SeaDragon

[Baa_Baa]

Despite continual dissappointing announcements, what I dont get is why a smart company like Comvita would get involved if they dont smell an opportunity? Surely after all is said and done perhaps we are seeing the birthing pains of a future flier and at these prices it could be the bargain buy of the decade. Shoot that one down Apathy, I enjoy your insights and will take into consideration any reasoning why this company is doomed before making it bigtime.

[Apathy]

Despite continual dissappointing announcements, what I dont get is why a smart company like Comvita would get involved if they dont smell an opportunity? Surely after all is said and done perhaps we are seeing the birthing pains of a future flier and at these prices it could be the bargain buy of the decade. Shoot that one down Apathy, I enjoy your insights and will take into consideration any reasoning why this company is doomed before making it bigtime.

It is hard to fathom but my guess is that they were prepared to accept an element of risk and struck a pretty good deal. Of course all depends on the quality of due diligence and information provided.

On the face of it - SEA are the only NZ producer of fish oil and it is obviously capital intensive so they should end up owning the market (in theory) in a country which has a very good reputation internationally.

But..... clearly they aren't efficient enough to pay the price to local producers to supply and/or there isn't enough supply and/or it is too low a quality so they are dependent on imported material - Sardine, Shark, Tuna etc. That model won't stand up - no possible way you can import to NZ refine and ship back north and be competitive.

Comvita are hungry for NZ material they can take to China - repackaged imported product isn't going to tick the box.

Comvita isn't being mentioned much at present and without going back through the releases I am pretty sure they were committed to putting more money in if targets were met. Based on today's release it is hard to believe they will have been which means should they want to put more money in they will do so at more favourable terms than last time (that weren't bad at the time)

So for the shareholders - there is probably good money to be made if you want to have a flutter. Price has held up well so I would be looking to dump and wait till actual release and the terms around next Capital raising - when it is hit next bottom grab some and get ready to dump them on the back of the next bullish press release announcing more money from Comvita.

Therein lies the next issue - the more Comvita end up owning the less attractive they become as a supplier as who wants to buy of a company largely owned by a competitor......

Its not doomed - someone will make a dollar out of it some day but it isn't going to be current shareholders.

IMHO

[Dentie]

So for the shareholders - there is probably good money to be made if you want to have a flutter. Price has held up well so I would be looking to dump and wait till actual release and the terms around next Capital raising - when it is hit next bottom grab some and get ready to dump them on the back of the next bullish press release announcing more money from Comvita.

Its not doomed - someone will make a dollar out of it some day but it isn't going to be current shareholders.

ha ha ha....thanks for your sage advice Apathy. I'll be sure to dump my holding on the opening bell. I'll watch out for your next edition so I know when to buy back in.

[Balance]

I am guessing that was tongue in cheek!? I just checked NZTE site - no mention of them even on a short list for an award. More fiction... https://www.nzte.govt.nz/en/how-nzte...015-finalists/

The joke continues - high stock, low cash, can't find a CEO and still planning expansion. Seriously the people that were supposed to know what they were doing and worked there couldn't get it right so who is making the decisions now on capital expansion??

Its just a smokescreen to do another capital raising for operating expenses under the guise of capital investment.

And how about this comment from the Chair to inspire shareholder confidence "Once achieved, we anticipate that additional orders will follow" seriously - 'we anticipate' !?

Doesn't go nearly far enough in terms of a market update to mitigate ongoing notice failures.

Directors selling in the last few months (which we are now advised were very soft) - dangerous territory.

Bang on as usual, Apathy.

Capital raising definitely on the cards soon as the net cash position of $4.3m after the Oct successful $10m capital raising must be now down to bare minimums with capex, stock and losses all in the wrong direction.

No self respecting capable CEO is going to take on the job without the company being properly funded - it is already a hospital pass with all the missed targets, deadlines and costs overruns.

[Apathy]

ha ha ha....thanks for your sage advice Apathy. I'll be sure to dump my holding on the opening bell. I'll watch out for your next edition so I know when to buy back in.

You seriously have shares??? I assumed it was some sort of family involvement and you were looking to protect their reputation... but nope - just good old fashioned ramping - hilarious!

[Apathy]

17 million shares traded in the last two days - those in the know getting out before the year end release this week....

[Scooter]

SeaDragon raises $3.0 m from Comvita; confirms exit from Omega-2 market
Comvita convertible loan to provide liquidity as SeaDragon to focus on significant Omega-3
opportunities.
SeaDragon (NZX.SEA), New Zealand’s largest refiner and blender of high quality fish oils and
fractions, announces its cornerstone investor Comvita has agreed to advance $3 million via a
convertible loan to assist the company through its staged exit of a currently difficult Omega-2
market and gradual build-up of the Omega-3 business.
SeaDragon Chairman Colin Groves said: “Over the last 12 months SeaDragon has transformed
its business. With the completion of our new Omega-3 refinery, we have lifted the company’s
processing capacity from just over 200 tonnes to 5,000 tonnes per year.
“We now have the production capability in Omega-3 to look to firm up both supplier and
customer agreements to deliver on our strategic objectives. The new refinery is performing well,
we are steadily building Omega-3 raw material supply relationships and we are encouraged by
the response we have received from potential customers.
“As we signalled in late April, volatility in Omega-2 markets has overshadowed these
achievements, with SeaDragon experiencing an extension in the Omega-2 sales cycle, and a
build-up in inventory. This has resulted in a slower transition from that market and a run-down
of cash reserves.
“Comvita’s agreement to advance $3 million via a convertible loan allows this transition from
Omega-2 to Omega-3 to occur in a smoother way. “SeaDragon’s Board is delighted with today’s
agreement, it represents an extension of last-year’s strategic partnership, which saw Comvita
subscribe for $3 million of new shares and agree to partner with SeaDragon to add value to the
New Zealand fishing and aquaculture industries. Comvita’s continuing support is very valuable”
Mr Groves concluded.
Comvita CEO Scott Coulter said: “Omega-3 fish oils are a core ingredient platform for Comvita.
We are committed to an on-going investment to establish a unique New Zealand sourced range
of high quality fish oils and are happy to continue to partner SeaDragon to realise this
opportunity”
The convertible loan will be subject to SeaDragon shareholder approval at the annual meeting
scheduled for in August 2016. SeaDragon will update the market as soon as a date for this
meeting has been set and additional information will be provided to shareholders in advance of
that meeting.
SeaDragon expects to release its preliminary unaudited results for the year to 31st March 2016
on 30th May 2016.
For further information:
Investors:

[Apathy]

Typically poor reporting which attempts to put more lipstick on the pig before Mondays dance..

CVT had options @.08 for $3million - had SEA hit targets they would have been compelled to exercise. The fact they haven't indicates 1) SEA missed targets (no surprise there) and 2) the terms of the convertible note must be even more favorable to CVT than the .08 !

Obviously cash burn has been horrific and it should now be of great concern they are exiting the traditional business for the pipe dream.

Motivation for 'exit' will be the ability to remodel the accounts to something more palatable.

[Harvey Specter]

How does CVT have to exercise its options. The fact it hasn't could be seen as a material event.

[kura]

I exited today (only had 300K, so no big deal ) my thinking being
- Were supposed to announce results today (my theory being if news was good, they would be in a hurry to announce it )
- To me it was a bad signal that terms of issue of proposed notes to CVT were not disclosed (my guess is that will need to be a heavy discount factor )