AlphaValue Corporate Services Fundamental Analysis FR
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AlphaValue Corporate Services
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Blackstone Resources

CR
Bloomberg   BLS SW
Batteries-Battery Sys  /  Switzerland  Web Site   |   Investors Relation
Banking on big-bang battery technology initiatives
Target
Upside 1,491%
Price (CHF) 0.75
Market Cap (CHFM) 32.0
Perf. 1W: -6.83%
Perf. 1M: -39.5%
Perf. 3M: -63.6%
Perf Ytd: -73.8%
10 day relative perf. to stoxx600: -14.0%
20 day relative perf. to stoxx600: -29.7%
Latest11/05/2022

Update on preliminary 2021 results

Blackstone Resources has released better-than-expected 2021 preliminary ‘unaudited’ operating results. Also, after the untimely exit of its auditor, the firm is likely to file its 2021 annual report in July 2022 – which has been authorised by the Swiss regulator. However, a big bone of contention for now happens to be clarification with respect to the Finma allegations and, hence, our estimates and recommendation remain under review, pending clarification(s) from management.


Fact

Blackstone Resources has released preliminary 2021 results, with the following highlights:

1/ Net sales were CHF49.2m (vs. AV estimate of CHF1.6m); H1 21 sales were ‘NIL’;
2/ EBITDA was CHF42.9m (vs. CHF8.8m loss); H1 21 loss was CHF1.6m;
3/ EBIT was CHF41.6m (vs. CHF33.4m); H1 21 loss was CHF2.3m;
4/ Net profit was CHF15.4m (vs. CHF34.3m); H1 21 loss was CHF2.7m;
5/ 2021-end total assets were CHF164m (vs. CHF191m); and
6/ 2021-end shareholders equity was CHF56.4m (vs. CHF70.2m).


Analysis

The above-mentioned figures are ‘unaudited’ numbers and a detailed release from management, with respect to the rationale for major performance revival in H2 21, is still awaited. It won’t be a surprise if the gain on the disposal of a minority interest in a precious metal asset – claimed to be closed in late 2021 but cash guided to be realised in 2022 – was booked in sales and, hence, benefiting the respective profitability metrics. Although the correctness of such an accounting entry, if it happened at all, remains debatable.

It is worth noting that Moore Stephens Expert (Zurich) AG quit as Blackstone Resources’ auditor in March 2022. As a result, the firm placed a request with Swiss Exchange Regulation AG for an extended deadline for filing the 2021 Annual Report. This request was approved by the regulator in late-April 2022. Now the deadline for filing the Annual Report is 31 July 2022.

However, since the start of 2022, the negative sentiment for Blackstone’s shares has intensified, with the scrip being almost reduced to August 2020 lows, which was also the time when the firm reported various R&D breakthroughs in the battery technology venture – thereby triggering a massive rally in the following days. While the stock has been highly volatile since then, its extreme movements have been very similar to Quantumscape (another new-age battery tech firm).


Impact

Our estimates and recommendation are under review and we await clarity from management, especially with respect to recent allegations from Finma (Swiss market authority).


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