http://www.afcenergy.com/

Dawnay, Day Corporate Broking Research Note

Aim Admission Document

As I have been out of contact for the last 8 days, I can put the pure weirdness of the markets especially AFC into even deeper realms of 'not making sense'.
Even allowing for the bad news from around the world filtering down, I fail to see why AFC's sp is down albeit just a tad, from when I last was in contact with the world of the Stock Market.
Having today read of the 'signed binding Heads of Terms with N2telligence GmbH relating to the use of alkaline fuel cells for fire protection, I expected to see the current sp at least a couple of pence higher than the 51p it closed at prior to the new opening up of yet another avenue for AFC Energy's fuel cells.
Apart from the above 'new avenue', surely it must make a case from just how many other applications are out there for the world of the AFC fuel cell.

Perhaps I will disappear back into the wilderness, only reappearing when the world of investing in shares starts to make sense.

You have to have faith in a share in order to buy it.

The above statement may be pleadingly obvious, but that faith/belief is that it will make you money.

That is not always the same as faith/belief that the product is a world beater or even a seller of moderate proportions.

Many AIM type shares have made their shareholders money without selling a single item, whilst others have lost their shareholders money, even having multiple sales.

Timing as they say, is everything.

So where are AFC in this conundrum.

If like many who have held shares since the days of single digits, I sold now, I would have made a decent profit. So the first part IE I have made a profit (albeit a paper one) whilst the company has not yet attained profitability.

The only question is
A Do I sell now, taking a decent profit, or
B Do I still have faith/belief that the company will prosper and go from being on the fringe of a world beating concept, onto a world leader in the field of 'The Fuel Cell'.

The choice as far as I am concerned is simple.

As I truly believe that the world beater comment will come to fruition, for me it has to be choice B.

Many will have chosen A and best of luck to them.
I feel strongly that holding on will bring me far greater riches that taking my present profit on the run.

Of course those who have sold now are out of the risk game as far as AFC are concerned. For us holders the risk is still there. Is that risk worth it.
We all have to decide, no one can do that for us, no matter how pro or anti posts are.

Simples really!

With all the present worlds financial problems, I have no faith whatsoever in the Stock Market 'in general'.
Several months ago, I sold all my holding in all those so called 'safe haven stocks' due to having a very uneasy feeling of where the markets are heading.
Also, although not much of a chartist, I could see where most stocks were heading.
So what stocks do I still hold.
Well one of them is obviously AFC, as an RNS (or several) suddenly being release can suddenly re-boost the sp by at least double digits, contrary to whatever is effecting general market confidence.
As for charting when it comes to companies such as AFC, yes indications can be found, but again if/when these expected RNS's come along, any directions given by said charts will be blown completely out of the water.
What's needed, as many have said, is patience, but it is difficult watching the sp being dragged forever downward.

And the reasons for this annoying downward spiral!

It's obviously no news, but mainly it's lack of confidence in a market that has little relationship with both AFC's technology and fundamentals.

Grrrrrrrrrrrrr!

blast, drat, drat & double drat - missed this today - was considering early then concentrated elsewhere!

gl to anyone who caught the rise today

Very satisfied with the statement, although obviously it could have been better.

OK so there looks to be some delay, which they have openly admitted to slightly under-estimated the time required.
Note the word 'slightly'.
As to the 'Hazop', this should as posters have already mentioned, be a formality.
These things happen, the problem is that when they do, most companies do or try to keep it quiet, AFC looks to be a company that is as open as possible.
As to the open day, I live many miles away, but I am sure a few on here will attend, and will look forward to reading their views.

As to the SP. Not sure if todays RNS will steady the SP or will frighten more into selling, specially with the market mentality at the moment.

So I am still a tad nervous as to the future of AFC, but as I said at the start of this post, I am very satisfied with the update.

Greek

GM i don't quite follow you with regards to the HAZOP,my understanding is it's a
safety clearence cert? Which if you consider the dangerous enviroment at Bittenberg,perfetcly correct and would expect nothing less.

From an earlier RNS.
The Company remains on track to deliver its commercial, Beta System, to AkzoNobel once the hazard and operability study (HAZOP) to permit its operation at the AkzoNobel site is complete.

Gm,by the way an excellent uodate and now considering buying back in?

Niceonecyril,

Sorry but don't follow you re you not following me (am I missing something).
I agree that the safety certificate is perfectly correct and I do not expect nothing less.
All I said, was that it "should be a formality".

GM thanks for clarifing that ,clearly crossed wires.

Niceonecyril,

No Prob. I often think I know what I mean't to say.

On a serious note, I don't, know if this will help, but on an alternative sight many have been asking questions re the importance of Hazop.
So I posted the following.

I also now little of Hazop, but have some knowledge of the enforcement (not the application) of Hazchem which is a similar system, IE a Hazop is completed prior to a Hazchem issue. What I do know is that 'all' such systems before the Bhopal incident in India 1984, were fairly lax. Since that incident, procedures have been greatly tightened up in all Hazchem and Hazop areas.
Believe it or not, a tanker carrying the same chemical as the Bhopal incident was stopped in Hull in 1985 where the driver had no safety instructions, no relative vehicle markers re emergency procedures, not the equipment required re dealing with any incident.
The driver did not even know what he was carrying.
The driver and vehicle operators received 'a caution'.
If you look at the Bhopal incident you will see how catastrophic it was.

If the same occurred now, the driver would have lost his Hazchem Authority and the company would have lost it's operators license. Both would have received fines, with a huge fine to the company.
The above may be a bit irrelevant to this thread, but it does go to show how strict things in the Hazardous Chemical business are in todays more risky world.

Greek.

GM cheers,one can only try to imagine what would be the result of an incident in the hydrogen rich enviroment?

On a more positive note,approval of and delivery of thenew bigger Beta system
would be a massive boost for the company and it's tech.

Finally some good news on a day that is heading for generally bad.
Will be interesting to see what the sp opens at and more importantly its closing price.
The big question is will investors see his as a time to buy, or keep selling due to the general market turmoil.
I can't see this being anything but a buying opportunity, although many may watch and wait just that bit longer, remembering that most expected the HAZOP to be received.

GM yes excellent news and very temptung at this SP,due to present market sentimen i've decided to hold onto cash at present,but good luck.

Hi Niceonecyril,

Same here re the cash, although if the sp stays the same or drops might just add to my holdings. The 10% plus spread will have to narrow though.
Amazing how the FTSE100 has moved this morning, from well down to up. Some will have made a killing.

Although i think cercunstances are different this time,a banking manager friend makes the point,that markets are run up and down to suit some.At least twice a year a crisis happens only to disappear once they've filled rheir boots?

It was the same following the last agreement to the Greek bailout which was supposed to steady the markets, but mot sensible people saw that it was just delaying the inevitable. same will occur this time after the agreement to buy Spanish and Portuguese bonds.
Its all papering over the cracks.

As to AFC, looks like I missed a buying opportunity, as the shares are now up. So still watching/waiting.

That makes a refreshing change.

Must be a first....Nice to see an RNS for Arsenal that refers to AFC Energy instead of the other way round.

Fear can knock the best shares.

This does in a roundabout way refer to AFC.

This morning one of the shares in my portfolio received awaited, expected news that resulted in an sp increase of around 39%.
This share as of late has been gradually reducing even though todays news was expected.
Due to the catastrophic financial and market crash, this share has been taking knocks following on from almost every achieved milestone. In fact the sp of this share was untill today lower than before they had achieved any of the last dozen or so good news bulletins.

Sounds like AFC doesn't it!

Even with the latest good news RNS, it has still not reached anywhere near to it's highs.
This company is well run and also has sufficient funding to see it through to profitability.

Sounds even more like AFC!

Many holders of this share, allowed the panic of the markets to influence them to sell, usually at a very low value price.

Sounds identical to AFC!

As this company's future, although in an entirely different field to AFC, is almost assured, I can see nothing but parallels with AFC.

So when the markets settle down to at last a smidgen of normality, and the awaited full field test result and first orders come in, AFC will be back to at 'least' the 75p mark where it belongs.

Like the example of my other share, it is nothing to do with the company that has resulted in the sp downgrade of AFC, but purely the general market sentiment, and like that other share it's day will come, and that day is not too far away.

So keep your nerve, and hold on in there!

Greek.

Holding so tightly it hurts! :o)

AFC Energy plc
Tim Yeo, Chairman

Ian Balchin, Deputy Chairman
David Marson, Finance Director

+44 (0)1483 276726

Allenby Capital Limited
Brian Stockbridge
Dan Robinson


+44 (0)20 3328 5656



Threadneedle Communications

John Coles

Fiona Conroy

+44 (0)20 7653 9850

About AFC Energy

AFC Energy is a world leading developer of low-cost alkaline fuel cell systems that use hydrogen to produce clean electricity, heat and water. AFC Energy's technology is focused on large-scale industrial applications and the objective of producing the lowest possible unit cost electricity. Please visit our website at www.afcenergy.com.



High efficiency levels: using readily available hydrogen and air as the source of oxygen, electrical efficiency is up to 60%, which compares to around 30% for conventional electricity generating technology.

Low cost production: fabricating with low cost materials combined with industrially proven production processes.

Low temperature and pressure: operating at less than 100 degrees Celsius enables us to use polymer mouldings for many parts.

Hydrogen sealing: operating at low pressure, hydrogen is readily sealed within the system.

Thermal management: a circulating liquid electrolyte simplifies the thermal management of the system.

Balance of plant: the majority of components are off-the-shelf and mass manufactured for other uses enabling us to benefit from these economies of scale.

Value engineered for assembly: the component count has significantly reduced and commercial units are designed for easy assembly.

AFC Energy has significantly reduced the cost of its technology to make its fuel cell system a commercially compelling proposition.