Ann: Strategic Review Outcomes, page-60

Good morning, opel24v,

Were I new to this stock, as an investor I would read this announcement about the recent Strategic Review, with a sense of deja vu, as I would have read many such cheerful outlooks. However, as with many long-term holders such as you, I read it with some understanding of its background - and that makes all the difference!

There are reasons for the resignation of our previous Chair, of another director, then of the CEO, and now of a restructure which involves the departure of two of the previous senior management team. Further, there is more than meets the eye in this: "As part of the Strategic Review, an independent expert group conducted a company-wide culture survey. Several key recommendations have already been actioned, including enhancing communication across the business and improving transparency around strategic direction and planning, one of the key areas highlighted in the review. " A "culture survey", eh? Perhaps I am unduly influenced by my own observations of multiple organisations, but "improving transparency around strategic direction and planning", may be a euphemistic way of saying that staff and management were not clear about what they were meant to be doing, and why. If that was the case, I'm sure morale suffered.

In May of last year I mooted to the then Chairperson (as gently as possible), that he should look more closely at the reasoning behind various measures and forecasts offered by the CEO. In response, he stated that he had every confidence in the CEO, whom he said he had chosen (and implied that he was mentoring). In October, we had another friendly and long conversation during which we discussed the composition of the Board , and again the matter of his confidence in the CEO. Despite his reassurances, I was not left any more sanguine. Nevertheless, for the sake of stability and the prospect as we then were told, of progress with our EV prospects, at the AGM the next month I did vote in favour of the Chairperson's re-election as a Director.

Towards the end of last year, the Board had commissioned a search for an additional member with relevant expertise in the battery field. That is how we found Merrill Gray. And what was one of the first things she did? Spent a couple of days in depth at the labs! When I heard that, I thought how ill-fitting was that to the views of the Chair about the "hands-off" role of Board members! If I am right, Merrill was prepared to insist that she could not take on the role of Director without understanding the company better. I would have done the same thing. I have said often enough before that Board members have to know quite a bit of how things are going on the ground - else how can they do their job? Anyway, I thought - "here is one feisty person!" Then we saw the interview with Friederike - that's still on the web site; that convinced me more - "here is a no-nonsense person, prepared to roll up the sleeves, and knows what she is talking about".

It is with that context that I read the latest announcement.

We have suffered from inadequate leadership since before the DiaSource days. At last we have a trimmed-down Board of three very committed people with leadership skills; in addition, we have Glenda's expertise in finance, Geoff's in Life Sciences, and Merrill's in the chemistry and battery fields. And in Merrill as MD/CEO, we have vigour, clarity, expertise, and dare I say it, inspiration, that must be doing wonders for morale in the company, even before the Strategic Plan is published - and the management and staff would have been involved in its production, and thereby have a strong sense of ownership.

So it is with this history also, that I read the announcement.

I am very pleased that the Board will remain for the time being as a trio, and Merrill as CEO - runs on the scoreboard before we need to do anything differently there. Also interesting that there are now three versions of the Ultranode - standard offerings? As for the potential expansion in India - well, that does surprise me, despite the caveat "depending on sales".

As for the current share price, I am tempted to write a different version of Aesop's fable. In this, Peter believes he has found a cave in the mountains that contains gold. He rushes down to the village with the news. A crowd follows him back up the hill, full of excitement and hope, but alas, it is but quartz crystals reflected in the glow of their oil lamps. Days later, Peter finds another cave - this time, he is sure he finds flecks of gold! The villagers climb up again to see, but without the same excitement - just hope. It is not simply quartz crystals this time, but alas, it is fools' gold.

You know the rest of this story - weeks later, he finds a third cave, with the real deal, but no longer do they believe him. Well, not everyone disbelieves. And some of their descendants became long-term investors in AnteoTech.