Comment on the Chairman’s Letter to Shareholders.
OPEN
1. “AN INVESTMENT IN THE SECURITIES OFFERED BY THIS PROSPECTUS SHOULD BE CONSIDERED HIGHLY SPECULATIVE IN NATURE”. Ill say, that is a gross understatement.
LETTER TO SHAREHOLDERS
2. ‘’This design is intended to be a first step of the Company’saim to become competitive with offshore wind power generation in large (or similar scale) deployments following a period of industry growth and cumulative deployments’’. The language and focus has completely changed. To compete with offshore wind at scale you are talking two decades. MINIMUM
3. ‘’A number of key technologies have emerged in recent years which make the low-cost digital development pathway more attractive than the iterative physical prototyping that has historically been the focus of Carnegie’’ No shit, when did you cotton onto this, more importantly, when were you going to tell shareholders? I wonder if that was suggested to WA Government to save the Albany Wave Farm. Or was this just a nice sound bite to create a new story so that the can can be kicked down the road a little longer?
4. ‘’Additionally, research and development in electric vehicle and drive technology have been expanding exponentially and the subsequent rapid commercialization of these new technologies also offers potential benefits for Carnegie. The same improved electrical subsystems used in electric vehicles for the powertrain are applicable to the electrical generator components of our wave power generation units and Carnegie will seek to incorporate these new low-cost electrical generator systems into the CETO unit design with the aim of optimising and improving the CETO technology’’. This actually makes sense, however this has been happening for some time, why is this thought bubble only being talked about now? Again another nice story to rope gullible shareholders in with more tales of big whales!!!
5. ‘’ The management team of Carnegie have defined targets for the digital development pathway and the Company will provide regular updates on its progress’’. I will believe that when I see it. The issue off course is that there is now nothing tangible to test or view. The modelling is only as good as the input and information provided and there are so many ways you can manipulate and twist data to suit your agenda. I foresee A LOT more wool over people eyes as to how the system is ‘’working’’. Where is the glide path to commercialization? All I see is a nice flow chart that is supposed to represent activities and deliverables. What about a genuine financial forecast on LCoE????
6. ‘’Carnegie has now addressed the previous problems in the Company, which stemmed from the failed EMC business. The Companies’ difficulties in completing the Albany Wave Energy Project arose primarily from the significant cash losses incurred by that EMC business and proposed R&D tax changes’’. At least they are finally being honest and admitting that EMC was the catalyst for CCE’s demise. However this bullshit that it had anything to do with R&D tax breaks is just fantasy. As I have maintained previously, you need to spend money in order to get tax breaks, CCE had none because of the drain from EMC. I am off the belief that EMC had been trading insolvent for years, I suspect that will come to light soon.
7. ‘’With its new streamlined structure, Carnegie is confident that it can reduce the funding burden on Shareholders and continue with its mission of delivering Shareholder value from renewable energy technologies’’. This seems peculiar. Not sure what is meant by technologies, there is only ONE that they are supposedly focused on. Seems deliberately suggestive and leading. More diversification on the horizon?
If you believe a word CCE are saying, you are optimistic at best. My personal view is as stated before is that it is a sham to save the company going into administration so that creditors can recoup cash and Directors don’t get disqualified under the CORPORATIONS ACT - Section 206.
The real litmus test would be if Mr Ottaviano and Mr Davidson bought more. I think not, Buckley’s and none!!!!
However, do not be surprised when Mr Davidsons shares come out of escrow that they are all sold off. POOF, gone!!!
Just goes to show little boys and girls, it does pay to be really, really naughty!!!
I will review the Prospectus over the weekend and give my two bobs worth then for anyone that cares to listen.
BUYER BEWARE!!!
Expand
