Hi guys and gals Yep - Still here and still talking to lots of...

Hi guys and gals
Yep - Still here and still talking to lots of people in the background. I like my chats with Iceman and Lex, wazza and Eire and many many others. Just haven’t really had opportunity to do much on Hotcopper as still have no PC or wi-fi as still no house so hard to write a decent post.
The last couple of months haven’t been great, perhaps a comedy of significant and compounding errors – actually that's an understatement. However, IMO this is just a blip. So, I'm going to give you my honest thoughts and assessment of the situation and where to from here.
Firstly, I'm still holding and haven't sold a share to qualify my position. Not saying I'm smarter or wiser in fact I'm very disappointed in our ex-NED "mate" who said he was doing tax loss selling prior to June 30. Private discussions between myself and Lex – lets just say I now agree with Lex that we are better off without Ratty on the board or register anymore. I believe he has now completely sold out and kept selling through July. You can look at the volumes and brokers and work it out. Maybe he’s been doing tax loss selling for next year? Lol. I know I have previously vouched for Ratty – but I assumed what he said was sincere. At the Nov 2017 AGM – he even said he was committed to 2025 and had a very long-term vision and fully committed to doing the best thing for shareholders ALL the time etc etc. He recently said he was only doing Tax Loss selling but that ended June 30. So, map to ground doesn’t add up anymore and I’ll no longer be seeking counsel or advice from that source. I believe there are other motives, but I’ll keep those as guesses and to myself. I'm not saying he isn't smart - i'm just saying i won't be listening to his motives or dialog anymore - or ever again as now useless anyway. However, its one less Xmas card I will be buying and I’m guessing there will be a few others inside the AHZ organisation and other shareholders with similar thoughts around xmas cards and Ratty!

I believe this singular act by Ratty has caught WP off guard too. I'll try to explain but its only supposition and IMO.
Regarding the April 4C - I personally predicted about $2.6m for adapt revenue - we actually hit nearly $2.2m. It wasn’t disappointing as such as there was no guidance, but it wasn’t spectacular either. I wanted to see one full quarter of 3D sales as proof we could ramp.
Regarding the July 4C - I predicted about $3.6m (and not 4.4m) but thought anything under $3m would be really bad - and would need very comprehensive dialog to substantiate. I didn't contemplate $2.7m as feasible at the time.
So - like any scary horror story, I woke up on July 31 up about 1:30am in the morning in the UK (opening time for ASX is 1am my time) and was instantly having heart palpitations when I saw the massive drop in share price. Yep - there was immediate panic and emotion - what the phuck had happened. I saw the $2.7m adapt revenue and panicked. Then I read the 4C dialog – only probably 76 or 77 times from 1:30am to 6am trying to make heads or tails and understand. I realised we are 3 to 5 months behind schedule for approvals in Europe and that hurts. Its not that we won’t get approvals – its just bureaucracy
We still got 25% quarter on quarter step jump in Adapt Revenue. Actually, not a bad jump considering we are missing the approvals we thought we would have. That’s the silver lining!
3D and Vascucel are helping to create that $500k extra in one qtr since release. IMO, that’s actually really good and paints a rosier future!
This of course is still not pretty - and it hurts the immediate bottom line because costs are still higher than revenue - but, it doesn't change the 2020 premise for which I invested - as long as AHZ can stay solvent which it can and will. If you invest in AHZ for the short term – this is an unloved, fickle retail shareholder base, with misunderstood and under-appreciated technology type of stock. I’m not going to buy into short term investor arguments – I’m only looking at my long-term plan. In fact, I wouldn’t invest in AHZ for any short-term hypothesis unless it was shorting both positive and negative announcements.
My guess is WP probably knew after the AGM into June we weren't and couldn’t track to the revenue target based on European approvals and had started the process of garnering interest for a second Cap Raise - in effect likely trying to find a large US based fund to make up for the smaller than expected recent Cap Raise which raised only $8.5mil and in hindsight was not enough given the changing circumstances. But the preference would be to do at a higher price. This of course is only in my opinion, but I think smart. I think Ratty also new and decided to start selling out – much against his rhetoric of only doing the best for shareholders. You can talk the talk – but after a while if you don’t walk it, then goodbye and good luck and get lost.
In hindsight, WP should have just been extra cautious initially and raised say $20m. My gut feel is that at the time - WP likely thought we would have had European approvals by mid to late May and didn't need that much of a dilution or cap raise and hence he raised the bare minimum for the best-case outcome which didn’t actually eventuate - that was a mistake in hindsight only but we all make mistakes. I know WP has said (and very seriously meant) that he didn't want to dilute shareholders unless really really necessary. But here we are, and I think he will be kicking himself for not just doing something like $20m straight up. IMO trying to do the right thing has burnt him a little bit and this man hates failing. He is true to his word and I don’t buy into all the talk of class actions etc but even so I’m not jumping for joy at the missed guidance and the situation in general! Of course, it hurts when you see the share price so low – and I’ve had my weeks of anxiety and stress but have collected my data and am moving forward.
I believe this cap raise process would have been started with the share price a little higher - where we could have raised at higher prices with less dilution if only the ex-NED who recently sold out hadn’t created a situation whereby the price we will raise at is slightly lower than desirable and hence why I think it’s taken WP by surprise and why the delay in getting the CR to market – because the recent and unexpected fall in the price has meant likely tougher negotiations which are no longer likely in our favour (bend over is an expression I don’t like to use but it’s coming). This is all just hypothesis as I've spent huge amounts of time thinking and talking and reviewing previous old emails etc.
I even stated in an email to WP that the last CR was the last CR that retail holders will likely support.
So here is the conclusion and kicker which I have come to terms with. I realise that my capital is going to get diluted in one way or another, but I sort of always guessed that there was one more big raise coming during code red. I was happy that the previous one was supposed to be the last one but alas. I've said before in posts that costs are high but they need to be with this business model and until revenue jumps we are walking a fine line. Unfortunately, the delay in timing of the approvals for 3D and Vascucel into Europe have been delayed from May and still not approved – my guess is another couple of months which will have a follow-on effect on the next 4C and hence the revenue downgrade from 34m to 25-27m range. Also, TGA approval is dragging on when it shouldn’t be – that’s Aussie Bureaucracy for you. Both of these approvals have delayed revenue and will slow the ramp up next quarter. However, we still jumped 25% quarter on quarter thanks to 3D and Vascucel and that is what I wanted to see when we launched 3D.
2020 is still on IMO. One thing WP has said is that the extra 3D products coming (Vascucel 3D as example) and the TAVR, SAVR, etc will continue to expand to contribute revenue that wasn't budgeted in the 2020 equation. I’m still in as are others I talk to although I know a long termer and mate decided to cut his losses – names withheld but he was a valued poster here. Of course there are others who are questioning their investment which is always a wise thing to do if it causes you stress or you aren't convinced of management. Thats always your choice. I haven't lost my faith in the long term business although got a temporary kick in the guys like everyone else.
Again, this is not investment advice or statements of fact – this is my opinion only based on a likely sequence of events and comedy of errors - to understand my position and the likely future, as I can piece together by sensible guesses, dialogs with many parties and historical emails.
DYOR and GLTAH.
Cheers
David