Latest Moelis report

I’ve just read the latest Moelis update and couldn’t help myself. They comment:

It is our understanding that the US$1.7m in revenue from new contracts is already included in AJX’s revenue guidance of US$18.5m for CY16, therefore, there is no change to our estimates.

I couldn’t remember any discussion from either Alexium or Moelis about Alexicool when the Moelis report came out in March 2016 so I went back to review that report.  There is NO mention of Alexicool in that earlier report.  Moreover they indicated that the revenue projections were conservative and:

“Whilst we have factored in market share growth in each of the divisions outlined above, we have not explicitly estimated new sectors for AJX.”

Hard to imagine that they would not include a new market and new customer in the figures but include a new product that wasn’t even sold yet and not specifically mention that.

So I have to assume they forgot what they wrote earlier this year or they have used their words loosely and mean instead that this sale further underpins the projected $18.5million.

I note also that their report makes no additional comment about what is stated in respect of the sale in to the adhesives market.  While the product name is not used the Moelis description of Alexiflam SYN-FILL in their earlier report says it:

“ is targeted for the plastics market including films, adhesives, fibers, masterbatch and composites. This chemistry is durable, halogen free and cost effective.”

As in the case of the Alexicool sale this “large sale” into the adhesives market cannot have been included in the projections for calendar year 2016, if they have been consistent and accurate in the comments they made in that March report.

Rather than assume that this means they will exceed the $18.5 million prediction, I am happy to work on the basis that there is an additional reason to be confident that they will get that figure – or close enough to it – to feel as happy with their performance then as I am now.

And just to repeat.  This is ONLY my assessment of the public documents
Do your own research and make up your own minds.

Parsifal