announcement due, page-16

Pixie (and others)

As I read it, there is a range of opinions expressed here that generally matches the expected average. You have the starry-eyed optimists expecting riches to fall into their laps, those optimists a little more circumspect and the pessimists who range from the uncertain (too good to be true) to those who deny all good news and who should be looking elsewhere. There are still those who were frothing at the mouth over suggestions that the price would ever exceed $3 again.

Why do I think TZL is so good?

1. The basic technology is simply brilliant. Yet it is being criticised for being too high-end a market. Why would you want to address a low-yield low-end market when there is more than you can cope with at the high-end?

2. The range of applications is virtually unlimited. If you can’t personally think of ten applications that could benefit profitably from Intevia then sell your stock, or more likely, look elsewhere to buy other stock. It is not for you.

3. The range of customers lining up to buy are at the upper end of their individual industries.

4. Due diligence has been performed recently by an astute team of experts with conditions that I read as indicating extreme support.

5. The share registry is extremely tight. The top 10 now hold 60%. Of those, many have increased holdings over the time I have been invested. The top 20 would be over 80% and adding in investors like me with multiple substantial holdings, the figure is probably over 90%.

6. The only serious seller has been the hedge fund DKR Oasis. They have sold almost half their convertibles (always sold in advance of the announcement) with little effect on the market since investors like me have taken advantage of the opportunity to add to their holdings.

7. Security of supply to customers was stated by DF as being a critical issue in getting the ball rolling. This has been filled by the provision of recent fund raisings. There are now at least 5 production facilities in place. Remember that Karmann needs up to 400,000 units pa alone and they approached TZ, not the other way around. They did so because they see a technical and price advantage that will save them money. Other customers are replacing existing expensive technology with smaller, cheaper, more efficient products that will also mean TZ will gain market share due to the superiority of their products. The Intevia units will end up selling themselves as market penetration accelerates. There will be 20-20 hindsight all round and not just among some investors.

I could go on about why I believe the price will rise to a much higher level but all that has been said often enough. You either take note of it, accept it, reject it or ignore it as part of the spectrum of information or opinion forming your background knowledge of a particular investment and how others may be thinking and why.

I have invested heavily, although nowhere near as heavily as some. I am admittedly overweight in TZL given my philosophy of staying below 10% in any one stock outside my own two companies. I’ll admit I can easily afford to lose what must be $3.5M worth of investment and so I don’t have heart failure through riding every 10c shift in price. I know the investments of many holders are relatively much more important because they form a bigger part and some even a majority of their entire investments. They are naturally more likely to follow every twist and turn.

Are your holdings likely to fall in the medium term, say 6-12 months? I would say not the remotest chance. Are they likely to at least double? I would say, based on detailed examination of the Intevia markets, the unit numbers involved, the range of applications, again, not a chance. It will have to do better than that. But if it should only reach $10 in that time then who among you wants to whinge that they only doubled their money (in the case of even recent buyers) or quadrupled it (for people like me)? Is that such a catastrophe? Those of us with large holdings who bother to comment at all here such as Klaas Pool think the forward earnings projections will arrive soon. They will accompany receipt of the next couple of POs from among the group Karmann, Navistar and BAE that the company is expecting in the next days or weeks. When they actually arrive depends on the customer not TZ management.

From that point, I expect to happen very soon, there should be a transparent process of valuation. Feed in the growth estimates that fit your investment profile and react accordingly. Even if the bottom line shows a high potential valuation based on over $1/share profit based on say $80-100M sales there will be those who still think and predict it will all fall over. Those of us who believe otherwise will continue to hold as the price appreciates. I’m in for the long haul post IPO as much because of the excitement of the ride from a low start price as for being part of a company of brilliant engineers / designers / managers / financial backers (DR for President) who will make a big difference in how we do things. My view is that DR and other large investors will be multi-billionaires if what I expect to happen pans out and I intend to be one of them. Take it or leave it.