I am reluctant to come here too much, and post too much...

I am reluctant to come here too much, and post too much negativity. There is little worse on Hot Copper than non-holders running down your stock. I feel a little emotionally invested in the projects though, even if I am not currently financially invested in DEL the stock. I'll try to be as objective as possible rather than negative for the sake of it.

I must admit, I really don't understand these LGCs, how they work, the benefit of them, or what they do. Presumably, neither does DEL. But if you need to actually be generating renewable energy to redeem them, it's a problem because DEL does not produce any such energy, and is at least 12-15 months away from doing so, even if it started tomorrow. Do you buy them first, or apply for them, then they are cancelled as energy is produced? I can't get my head around it. Why not just produce the energy and sell it? What advantage are they? It's created a world of trouble for DEL anyway.

Even in this announcement, in which it is difficult to find any positives, DEL manages to spin and use LinkedIn-type puffery. Whilst trying to distance itself from responsibility for the amount owing:



Meanwhile, in the "About" section of the announcement:



Here, DEL is simultaneously promoting the fact it "comprises of a group of four vertically-integrated companies".

So, which one is it? Is "Retail" a key part of an integrated business, or an unimportant legacy project? The whole distancing itself from the $2.1m owing part sounds a bit like a guy who gets a speeding ticket and writes a reply to the fines unit "Yeah, but mate, that car is on blocks in the back yard with a tarp over it. I don't even drive it any more. The engine's buggered. I drive another car now. This 'having to pay a fine thing' is really confusing".

The fact they say they knew about it ages ago (but made no plans to address it), then ask for a trading halt (which implied the letter was a surprise) to presumably spend the day strategising how to deal with it, before asking for a suspension (even though the debt is only owed by an old energy retail division, not really to DEL and the core BOOM projects -- seriously!!!!) to raise money is staggering, just as LongCleanEnergy says. They could have tried to raise funds weeks/months ago. Why leave it until the letter (which apparently DEL knew was coming) is received? I remember Joe being a finalist for MD of the year last year. Incredible. Aside from the flurry of information and humble bragging in October, seven months ago, nobody has seen nor heard from the owners for probably 18 months. The first year's AGM was online, but I don't recall last year's even being recorded/released. It has not helped goodwill or transparency. There is a sneakiness to a lot of what has happened which displeased me.

As LongCleanEnergy says, how on earth can you mess up a business in the green gas & electricity / recycling space, in the midst of a national gas supply crisis, with, as Hamish liked to say, "hungry gas users in hard-to-abate sectors". It's unfathomable.

I know of small cap companies where Hot Copper posters say they've e-mailed the MD to ask questions about the project and received a thorough, helpful response from the MD personally, a few hours later. There are virtual site tours, ask me anything sessions, newsletters, YouTube videos, etc. Investors know exactly what is happening. Meanwhile the share price is tanking due to sentiment, low commodity prices, and market pressures, but there is a lot of forgiveness and understanding to go around. Investors feel in safe hands and can see a path forward. Cap raises are well subscribed. It feels like Delorean directors, as I've written previously, have given up. In reality, this is probably not the case. However, the lack of accurate and truthful information has destroyed retail investors' trust. Would it really be that much of in imposition to update investors on why the NZ site still hasn't been signed off, despite a supposed 3 month commissioning process? Or to explain exactly what Palisade Impact is looking for before it makes its FID decision? Or to produce a joint statement with Brickworks about the Horsley Park project? They haven't even bothered to make a ten minute video to reaffirm that everything is on track. Now there is talk of a capital raise. Not likely. All investors have received since the Planum Partners 'finding finance process' is "trust me, bro."

Suggestions of raising capital at X cents per share are simply academic arguments. The raising last time only brought in $1.5m at 17 cents per share. It was undersubscribed, at a time when the business/financial situation was orders of magnitude better, and interest rates were lower. I question how much could be raised at any price, dilution aside. Christlechat questions 'who would buy in'. I agree. Something substantial, structural with DEL, would need to change/be offered, aside from a bargain basement raising price. The resignation of Joe and Hamish. A joint declaration with Palisade with detailed time lines. A start-of-construction date measured in weeks, not months. Detailed costings, IRR figures for the BOOM projects, and various financial workings out (like a mining project feasibility study). That type of thing. Investors know that money invested at 3.2c which goes to zero is a 100% loss. Money invested at 0.01 cps which goes to zero is also a 100% loss. I doubt there would be any institutional interest either at the moment.

I remember that EmptyTrolley questioned who would give DEL money. They currently have no way to repay any debt. There is no income and the only asset which could be used as collateral against a loan is their SA1 land -- which coincidentally is worth about the same amount as the debt. They'd need at least three million, I suppose, for the debt plus working capital. We suspected a cap raise could be afoot from last quarter's statement even without this new $2.1m issue. At ten per cent interest, that's $300,000 interest per year. It's a bit much for the CBA credit card, unfortunately.

This company's financial situation has been perilous from the beginning due to EPC projects which, I suspect, were in a much worse state than described in April 2021. They've been playing catch-up, distorting the situation and spinning plates with NZ and BLM and robbing Peter to pay Paul with IPO and cap raise funds since listing. I think the IPO was over-subscribed 5 times and shares doubled on the first day of trade to 40 cents. I always wonder what if.... What if they'd listed at 50 cents instead of 20 cents. And there'd been enough money to finish the NZ & BLM messes and build SA1 -- and it SA1 was operational today to borrow against to fund QLD1. If only....

I think the only hope is a convertible note, with management themselves fronting a large sum. We see now why they haven't been buying shares on market. They knew this was coming. SourLemon doubts Palisade would invest more. So do I. They're not the Smith Family. They are/were looking for a partner to invest in bio energy plants with to benefit their investors. Bailing out their financially insecure, $6m market cap partner is presumably not in their charter. It would protect their $5m convertible notes arranged late last year, but risks throwing good money away after bad.

BigCityTrader questions whether the projects are really as advanced as DEL says. Good question. Who would know? In the IPO, SA1 and VIC1 were supposedly "shovel ready" and would proceed with funds from the IPO. However, later announcements suggested they weren't ready. Either LongCleanEnergy or Axed personally visited the site and spoke with the VIC1 farmer (maybe late last year...?) who owns the land at Stanhope. The farmer himself raised concerns about the project being ready. There have been so many vague and contradictory announcements. Self-serving announcements, in which the narrative changes according to the situation.

Ziggy124 said the FID situation needs to be addressed before anyone puts fresh money into the company. I partially agree, and part disagree. The problem is FID is totally beyond DEL's control. It all depends on the investment committee at Palisade Impact. It's like starting a modular nuclear energy company, coming up with brilliant business plan and design, but needing the federal government to change legislation before you can actually begin construction. Who knows if/when that will come?! It's a chicken and egg thing. And why would Palisade agree to $100m of funding to a company which appears to be on the verge of administration / insolvency? Why would Brickworks partner with a company and begin a 12 month construction period to co-own a site in these circumstances when it might not be completed if the co-owner/construction company becomes insolvent? If you knew your home builder was in serious financial trouble, and you were on the verge of signing a contract for a new home, you wouldn't be keen on paying a $30,000 deposit. Without confidence the business you're dealing with is rock solid, suppliers, financiers, etc. -- all of whom are providing credit -- don't want to deal with you. So, FID would provide certainty and stability for investors, but without certainty and stability to begin with, Palisade won't provide FID. It's a problem which I do not know a way around.

Bottom line is, I suspect they wouldn't get anywhere near enough from retail investors to make a raising worthwhile after fees are paid. The owners would be diluted to buggery, for very little return and they'd still be well short on the $2.1m owed. Perhaps they will try anyway, along with a blitz of YouTube presentations and hopium as a last ditch Hail Mary approach to stay afloat.

If the projects are as advanced and lucrative as described, the directors/majority owners will need to be heavily involved themselves in a convertible note purchase; possibly with some private equity funding. They've got two weeks to arrange the type of large sum -- to save the company -- that has eluded them for the past 19 months with Planum/Palisade stringing them along. I wish them luck.

As StockyBonbon says, a video from DEL is the absolute least this company can provide. I would be interested if a response was received to this enquiry.

Good luck to all holders. I honestly mean that.