Prime Energy share
Prime Energy
0%
Base:250.9
opening:250.9
High:250.9
low:250.9
change:251
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Has lost 90% since the record it recorded shortly after the IPO. The renewable energy company does not impress with its activity, neither with the results nor with the investors, who abandon it after losing quite a bit of money on it (it continues to fall by 22% this year as well). In the meantime, its bond yields were able to jump to double digits: the short bond (bond A – shekel, convertible into shares) at 2.2 is trading at a gross yield of 26%, after it fell another 5% today and completed a fall of 25 % during the last year. The longer series (B-bonds) with an MFA of 3.12 is trading at a yield of 22%, after falling 1.7% today and completing a 33% fall in the past year.
The one who decided to abandon ship is Yitzhak Cohen, the company’s CFO, who came to it in early 2021 from Lapidot Capital, shortly before the IPO. When a CFO leaves, it’s not good for the company, and when he leaves at a time like this – when the company needs recruitment, it Much more problematic and indicative of the state of society.
In the last year, Cohen earned a salary of NIS 35,000 per month or an annual salary of NIS 420,000. By the way, he asked to receive all the salary in cash, not in shares and options – and he also knew why. The decision was of course correct for him, if he had received options they would not have been worth anything. Cohen has a bachelor’s degree in business administration and accounting and a master’s degree in management and finance from the College of Management. And another interesting point, quite amazingly – the company committed to Cohen that it would continue to insure him with directors and officers insurance, for 7 years from the day he left the company.
The money is about to run out. Will she survive? It burns cash at a high rate
Prime Energy barely registers income, and on the other hand it burns a lot of cash and registers losses. In the first nine months of 2022, the company brought in only 5 million shekels (down from 5.5 million in the corresponding period in 2021), it recorded both in 2021 and in the first nine months of the year a gross loss of more than one hundred thousand shekels (and when you lose gross you obviously cannot make a profit ). In 2021, it recorded an annual loss of 18.4 million shekels and in the first nine months of 2022, it recorded a loss of 17.3 million shekels, compared to 15.3 million in the corresponding period – that is, the losses are increasing in the last year.
Say, no big deal, it’s a growing company, it’s not supposed to make a profit yet. This is true, but the rest of the company’s figures are also not good, and the question is how long will it be able to survive like this? Not sure much. 37.5 million shekels remained in her cash coffers as of the end of the third quarter of 2022, since then it is likely that she had time to burn more cash, and this is compared to the fact that in the corresponding period she had 111 million shekels in her coffers.
Since the beginning of the year, the company has burned NIS 31 million on current activities and investment activities (and it is likely that since then it has had time to burn more), when it raised the available cash mainly in 2021 – when the euphoria in the markets was still at its peak, and when the interest rate in the economy was zero. No one can guarantee that it will be able to mobilize even in the current macroeconomic reality. During 2022 it raised NIS 54 million in B bonds and in 2021 it issued shares to the public for NIS 58 million (in the issuance) and then another NIS 76 million through A bonds – which can be converted into shares. But the money is running out quickly and there is only NIS 33 million in working capital, compared to NIS 107 million at the end of September 2021.
The salaries of the company’s managers are responsible for 34% of its total annual loss
The five highest paid employees in the company received an annual compensation of NIS 5.2 million last year (most of them in cash, by the way, with the exception of the previous CEO Lior Aharon), which equates to 34% of the company’s annual loss (NIS 15.3 million). This explains quite simply the The problems in society.
By the way, Prime wanted to enter the stock market at a value of up to NIS 600 million, but had to settle for only NIS 310 million, almost half of the value the company had dreamed of.
The controlling owner owns 66.5% of the shares, Phoenix another 7.5%
The controlling owner of the company (66.5%) is Yaron Kikoz, who is also the chairman of the board and CEO of the company, after it failed to find a company for six months, since the departure of Lior Aharon at the beginning of 2022 (this departure was also of course due to reasons that do not require reporting to investors ). The company decided to appoint Kikoz as temporary CEO in March a year ago, but the temporary now becomes permanent when after a year in which it failed to find a CEO – it appointed Kikoz as CEO of the company this week.
The one who is still invested in the company is the Phoenix (7.5%) which is certainly not happy about this investment. A Prime Energy share is now trading at a price of 251 agorat and a market value of only NIS 74 million.
The company has yet to respond to the article. The response will be attached when received.
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