I started writing a short post but it ended up being many hundreds of words so I'll save it for another day and try to make this short! I don't know where
@drinking's optimism comes from about calling the bottom, but I'd like some it, please
We're a $14 million market cap stock. I am putting aside the Yarra Valley distraction, which may or may not add to our cash-at hand position, if we can make a profit off the build. I share a previous commentor's opinion that making money from contracting margins is perilous. At best, it will give DEL experience and prove our ability to potential future clients in the eastern states.
The real money is in owning 50% of the $50 million SA1 and VIC1 ($25m?) and collecting yearly income from energy sold and related site revenue. With both sites built, we'd be trading well below NTA (14m vs 25m) and with X million per year in recurring revenue giving us a positive EPS figure and low PE ratio.
Long term, our success relies upon getting those plants built. Short term share price success is on announcements (such as FID and progress reports). If one is confident both plants can be built reasonably trouble-free and within a reasonable timeframe, the current share price is a bargain for the very, very patient investor. I'm not expecting any share price re-rate until we get an update showing SA1 and VIC1 construction is well underway.
For the optimistic, we can imagine DEL is more experienced at building sites after BLM and NZ. Supply chain issues and Covid are behind us. And these sites have been (hopefully) planned to a meticulous level given the delays. Obviously the more often a company does something the better it is at doing it.
I agree -- nothing much new in the report. The main game is us awaiting Palisade FID. Hamish says construction is scheduled for Q4 (1st March -- 30th June), although who knows with these people!
Interesting news regarding Steve and ToxFree. Australia is a big place and apparently there is 30m tonnes of organic waste per year. I'd like to think there is plenty of waste available and that gate fees to accept it are rising but would also be keen to know more about their venture. Thank you to the contributor for posting that link. I will check it out.
