ShareProphets

The one stop source for breaking news, expert analysis, and podcasts on fast-moving AIM and LSE listed shares


Join ShareProphets at less than 2p per article

> All the big AIM fraud exposés

> 300 articles and podcasts a month

> Hot share tips

> Original investigations by our experienced team

> No ads, no click-bait, no auto-play videos

Find out more

Sabien Technology – looking back over a (correctly called) Steve Moore dog

By Nigel Somerville, the Deputy Sheriff of AIM | Wednesday 7 March 2018


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.


Thumbing through the top list of losers today I can’t help but notice that AIM-listed Sabien Technology (SNT) is top dog, so to speak, having dropped 36% today on no news. I wonder what is behind this drop! Does somebody know something?

I see that the chairman, Mr Bruce Gordon, has been lending the company money - £50,000 since the back end of February on top of £100,000 in December– which suggests than plans to arrange a placing have hit snag.

So just how bad are the finances? Let’s look at the interims to December, which were released on 31 January. Here we see the following Red Fags:

Net Current Assets – MINUS £101,000. Oops

Loss - £233,000. Ouch

Cashflow: increased trade and other payable of £226,000 whilst at the same time receivables and inventory decreased. In other words, the company is surviving by not paying its bills and leaning on debtors to pay up. So while the cashflow statement shows a net cash inflow of £107,000 it is a highly illusory figure – take the increase in payables into account and it would be an outflow of £119,000. One would imagine that game can’t be played much more.

Still, I suppose so long at Nomad Roland Fatty Cornish is paid then all’s well.

Out of revenues totalling £462,000, £259,000 came from just one customer and £413,000 came from three.

Now a cash outflow of £119,000 (after paying off the payables) might not seem too much of a disaster, but it is still about £20,000 a month. But for a company with a market capitalisation of only £0.2 million, that’s a big old bill.

Now it has a market capitalisation of £0.2 million and owes its chairman £150,000. Who’s going to pony up for a placing!

But then there is the small issue of the company’s Broker – none other than Roland “Fatty” Cornish, who is also the Nomad. The problem is that Beaumont Cornish is only a broker of note – it doesn’t actually do the fundraisings itself.

I fancy today’s share price drop is well justified! Anyone for a sale of the business for, say, £1 and a cash shell?

Meanwhile, with the stock closing at 0.225p (as against Steve Moore’s sell tip a little over a year ago at 3p – well done Steve!) it is hard to see anything other than further collapse ahead.


Filed under:


Never miss a story.




This area of the ShareProphets.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ShareProphets.com. ShareProphets.com does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ShareProphets.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ShareProphets.com and is not intended to be relied upon by users in making (or refraining from making) any investment decisions.


More on SNT


Comments

Comments are turned off for this article.




Site by Everywhen