By Nigel Somerville, the Deputy Sheriff of AIM | Friday 16 December 2016
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Wow! I’d love to have been a fly on the wall over at Cairn Financial as the wording of last night’s no-one-is-watching-o’clock RNS from AIM-listed CloudTag (CTAG) was being, ahem, “discussed.” I wonder how long that lot took to put together….since last Friday? It was a real shocker.
The exclusive definite, guaranteed in-the-bag-for-2016 sales order for $5.2 million? Oops, sorry, a definitely maybe £800,000 perhaps order. Oops, indicative but nothing this side of January 2017. Oh, and we’ve got another possibly maybe sometime perhaps potential customer which may or may not bring in some sales, so it wasn’t very exclusive either.
The manufacturing line which only last week was expected to deliver product in December 2016? Ah, well, now the thing is that well….er….we have to be prudent (so where has all the cash gone?) so we’ve only had a handful of demonstration units made and won’t be commissioning the production of large numbers until we’ve got some orders. So there are no orders, no commitments to orders, and still no devices to sell. Just where has all the money gone?
The countdown clock on the company website which the loons thought was a timer to the Big Day when the golden tickets exploded in value? Ah, well, we’ve got a new name for the device which you still can’t buy and nobody has put any orders in for and we’ll tell you it soon. Gosh, that’s exciting then. The new name, like Mr Godot, comes “tomorrow”. The product does not. By the way, where has all the money gone?
Has the “small number of units” even arrived at the company yet? Or is it a case of the cheque’s in the post?
The corporate structure? Ah, well, it's really exciting – we’ve started up a new subsidiary to do…er…exactly the same thing as the other subsidiary we had, and from which all our directors have now stepped down and been replaced by a chappie who’s really good at dealing with one-way trips to the corporate knackers yard. So that’s alright then. Where has all the money gone?
The conversion notice received from L1 last week? Well, you see the thing is that it sent the conversion notice via telemessage. It’s almost as good as a telegram – you phone up the nice people and they type it up for you and then pop it in the post. Round at CloudTag Towers the postie was running a bit late that day so only dropped it in at the end of his shift. Right.
The shares announced last week to be heading for admission to trading yesterday morning? Ah, well, now you see the thing is that we just didn’t quite get around to issuing the shares. I guess we weren’t sure whether they were conversion shares or warrant exercise shares, so it was a bit tricky to get it all signed off by the powers that be.
But the good news is that L1 hasn’t called a default on the loan deal and so long as Cairn and the oxymorons deliver on getting the suspension lifted as promised we can now draw down the next £0.9 million and L1 can carry on selling the crap out of the stock. So they’re happy.
Oh, by the way, we (cough) forgot to mention a related party transaction under which a director of one of our subsidiaries got warrants as payment for services rendered by another company. We’re not quite sure why they went to him and not that company (as we had previously announced), but frankly the meeting with Cairn has gone on for so long now that we all want to get off for a bit of Christmas coke and hookers. You do understand, don’t you?
As for the suspension, well that’s being lifted. Phew! That really did put a spanner in the works for our main product.
But the production line for that is now fully up-and-running again – indeed, the plant is running at full capacity and with the most incredible efficiency.
And so it is back over to our sales team today. Armed with the launch of the new branding of the device which nobody can buy at the moment, we can get back to producing, marketing and selling the main product of the company by the lorry-load.
Oh, what product is that, you ask? Is it the wearable device? Is it some clever bit of medical grade technology?
Don’t be silly – we’ve got nothing like that available to sell! No, we are only interested in selling the one thing that we’ve proved ourselves to be expert in both selling and producing:
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