Frmen, mate, all good. My comment was more for Orion given the...

Frmen, mate, all good. My comment was more for Orion given the oft repeated assertion that we are hugely undervalued. This has concerned me because I've been pointing out that sustained Net Profit is the key to growing our Share Price…. and the truth is we have a way to go yet. Naturally there is excitement as we achieve output & income growth, but the costs (expense) to achieve this now and going forward are high. We undertook a significant fund raising during the Quarter, business is not self sufficient yet.

If we put our Fund Raising (Investor Funding via Convertible Notes) to one side (as we should), at this point in time we are not yet a profitable company. We will record a net loss this year. We are still in a building phase.

The Company states that we made a profit this Quarter. I can see how this has been represented on the Statement, I'm delighted with this achievement, but the holistic view is we actually incurred a loss (see below).


Cashflow / Profitability - this Quarter

¬ Most recent Quarter shows profit for 1. Cash Flows From Operating Activities. But this is not the full picture.
¬ 1. & 2. should be combined to incorporate our costs for Property, Plant, Equipment & Non-Current Assets, at which point we incur an overall loss.
¬ The proceeds of another Convertible Notes issue brings it all into credit again, but fund raising is a limited means to an end, and is debt that needs to be repaid, it is not income.

Cashflow / Profitability - Full Year

¬ YTD for 9 months including this quarter, we aggregate to a Net Loss;
¬ Outgoings for next quarter are forecast to increase significantly, indicating we will record a Net Loss for the final Qtr & Year.

Convertible Notes

I'm not a fan of these, but as a Shareholder, I accept that our Company has chosen this avenue as a key source of funding. One positive aspect is less Shares on issue. These instruments may also act as a Takeover deterrent.

A downside is these Convertible Notes will rank ahead of you and me as Shareholders, they are a drag on earnings (we have to pay interest on these), a liability that will have to be repaid, impacting bottom line profit results. Not too many Companies have used this instrument for funds. Perhaps somewhat innovative, but I'm hoping we do not need to issue any more of these.


Summary

I've put this together quickly, apologies, as I'm out of action for the next few days. I consider fellow Shareholders on here as colleagues all in this together wanting our Company to do well. It is a shame that the tyranny of distance precludes us from getting together and discussing these matters over a beer or two !

My key point I want to make to Orion is it is too early for our Share price to really take off. I think our baseline should be a few cents higher simply on speculative potential, and the ground we hold, but overall I don't think the market has got this wrong. Our upside will be linked to sustained NET PROFIT going forward. Could take place at some stage next FY, or the one after that. All depends on costs v income.

NB. This is my largest Shareholding (by number of shares) and in a few years’ time, I hope by value as well. I'm already looking forward to a few months time reviewing and reporting on the more detailed EOFY accounts !

GLTH