CSS - Clean Seas Seafood

[Ruincity]

Re: CSS - Clean Seas Tuna

I have been a part of this stock for a reaonably time frame now (especially for my trading style).
Is there any reasoning that I am unaware of that would explain the relentless selling/dumping that has been evident over the past 3 days??

Has been some decent volumes going through (For CSS) and the sell queue is simply being eaten away by on market sells with very little buying support (other than queued orders)..

Starts to make one wonder - is there something we/I don't know?
or
Is this just a normal ebb and flow....

 

[tge oracle]

Re: CSS - Clean Seas Tuna

I have been a part of this stock for a reaonably time frame now (especially for my trading style).
Is there any reasoning that I am unaware of that would explain the relentless selling/dumping that has been evident over the past 3 days??

Has been some decent volumes going through (For CSS) and the sell queue is simply being eaten away by on market sells with very little buying support (other than queued orders)..

Starts to make one wonder - is there something we/I don't know?
or
Is this just a normal ebb and flow....

Ruincity,

I don't think there is anything sinister going on with CSS. There are large volumes changing hands but that does mean there is buying support, unlike 2007 when there were only sellers. My guess it is larger investors re-balancing their portfolios. Additionally, the rapidly rising AUD is not helping. Most of CSS's YTK is exported so this must be impacting margins.
There won't be any significant change in the value of CSS until SBT is produced in commercial quantities.

 

[truevalue]

Re: CSS - Clean Seas Tuna

There is a keen seller in the market who has been around for a couple of weeks now. Buyers know he is there and so are hanging back forcing him to sell at lower prices. In thinly traded stocks this sort of trading is just a fact of life that in no way affects the fundamentals of the business.

Why is the seller selling? Who knows but it could be something as simple as a new portfolio manager who doesn't know the stock just getting it out of the portfolio.

 

[keskinu]

Re: CSS - Clean Seas Tuna

Informative story on the Port Lincoln SBT industry featured on Landline today. Video available on the ABC website...
(sorry - it won't let me post a link as i have less than 5 posts)...

 

[nizora]

Re: CSS - Clean Seas Tuna

Informative story on the Port Lincoln SBT industry featured on Landline today. Video available on the ABC website...
(sorry - it won't let me post a link as i have less than 5 posts)...

Catch 22 Landline -ABC 23 AUG 2009

"The tuna season in South Australia is winding down after the most tumultuous year in more than two decades. Prices have plummeted, as Japanese consumers tighten their purse strings and Tuna producers are also under pressure from conservationists as campaigns against tuna fishing gather pace."

http://www.abc.net.au/landline/content/2008/s2663962.htm

 

[keskinu]

Re: CSS - Clean Seas Tuna

Thanks for posting the link Nizora.

Looks like interesting times lay ahead for the SBT industry in the mid-term. I still happily hold CSS with a 5 year outlook.

In my opinion, I think if CSS are successful with a 'sustainable' SBT product (this importantly includes the use of alternate pellet feeds), and if CSS is able to 'market' it's product with this sustainability as a differentiator - then I would like to hope that there is enough demand in that niche market to make up for a more general price drop in wild catch SBT... not sure that this is a great analogy (it's getting late and I might be rambling a little); but if you look at something like "cage farmed eggs" versus "free range eggs", I think that armed with the right information, consumers can choose to make a difference and spend more for a product based on ethical grounds. The fact that CSS could provide a 'sustainable' alternative to wild catch SBT is one of the main reasons I personally hold this stock...

definitely still a way to go on this journey though....

... looking forward to seeing how the first batch of juveniles handle the transition to 'at sea growout' later this year...

As always - do your own research, and invest based on your own reasoning...

 

[copashark]

Re: CSS - Clean Seas Tuna

In terms of the spawning of SBT later this year, im anticipating numbers of fingerlings to be significantly higher than the last spawn. CSS were not ready for the numbers of fertilised eggs at the last spawn.

The SP has rallied in advance of the last spawning, i expect this again and better outcomes

DYOR, i hold and Im accumilating.

 

[truevalue]

Re: CSS - Clean Seas Tuna

Catch 22 Landline -ABC 23 AUG 2009

"The tuna season in South Australia is winding down after the most tumultuous year in more than two decades. Prices have plummeted, as Japanese consumers tighten their purse strings and Tuna producers are also under pressure from conservationists as campaigns against tuna fishing gather pace."

http://www.abc.net.au/landline/content/2008/s2663962.htm

Prices have plummeted from crazy unsustainable levels where we saw many stories of record prices being paid for single fish. There were stories of farmgate wholesale prices of over $50/kg

When CSS talks about $10 gross margin/kg my information says they are not assuming the prices that have been achieved in the last few years but rather a more realistic price of around $20/kg at the farmgate.

A moratorium on NBT and SBT wildcatch would be shocking for Port Lincoln tuna industry (but great for CSS) something that noone wants (and CSS doesn't need).

Asking the head of the Tuna Fishing Association his view on the future of CSS is akin to asking Kevin Rudd if Malcolm Turnbull will be the next Prime Minister. Having CSS succeed is almost the last thing he and his members would like to see.

 

[Ruincity]

Re: CSS - Clean Seas Tuna

I have been a part of this stock for a reaonably time frame now (especially for my trading style).
Is there any reasoning that I am unaware of that would explain the relentless selling/dumping that has been evident over the past 3 days??

Has been some decent volumes going through (For CSS) and the sell queue is simply being eaten away by on market sells with very little buying support (other than queued orders)..

Starts to make one wonder - is there something we/I don't know?
or
Is this just a normal ebb and flow....

Well the relentless selling has not eased in weeks.
Makes you wonder what has fundamentally changed and why the rush for the exits?
35cm fish are now swimming around?
Should have followed my gut instinct and sold out when early signs indicated that things were heading south...

We need some really good news to restore some faith..

 

[tge oracle]

Re: CSS - Clean Seas Tuna

Well the relentless selling has not eased in weeks.
Makes you wonder what has fundamentally changed and why the rush for the exits?
35cm fish are now swimming around?
Should have followed my gut instinct and sold out when early signs indicated that things were heading south...

We need some really good news to restore some faith..

Ruincity,

As explained in my earlier post I think that some of the early selling was re-balancing portfolios around the cap-raising where there is traditionally higher volume trading.

Since the cap-raising the AUD has appreciated approx 20%.
CSS is essentailly being valued on the YTK business at present.
In addition to the rapidly rising AUD they have cut production of YTK from 1.25M from 1M. So they have the double whammy of reduced product sales and decreasing margins which will lead to lower revenue / profits.

 

[truevalue]

Re: CSS - Clean Seas Tuna

Well the relentless selling has not eased in weeks.
Makes you wonder what has fundamentally changed and why the rush for the exits?
35cm fish are now swimming around?
Should have followed my gut instinct and sold out when early signs indicated that things were heading south...

We need some really good news to restore some faith..

I thought the results announcement was very poor. You had to read it in conjuction with the prior announcement re the write-offs and downgrades to try and work out what one-off's had been included. There was no decent commentry that went with the result which made it very difficult to interpret.

Important details such as king fish sales volumes were excluded, the farmgate price they are getting is impossible to establish as is the margin they are achieving in YTK. I at least would like to see some evidence they are improving YTK production efficiency.

Hopefully there will be some decent disclosure in the annual report and at the AGM.

 

[Ruincity]

Re: CSS - Clean Seas Tuna

Yeh well I'm not exactly a fundamentalist in my trading and this stock is one that I own based on some basic fundamentals and the fact that I really like and believe in the business concept moving forward.

I understand that Lonsec had re-rated their advice on this stock to "under review". So maybe this is where all the recent wholesale dumping has come from... 545355 shares traded so far today another whopping volume number in CSS terms..

Yes, some of the details were sketchy on the recent report but this has long been the case with CSS reporting anyway.. I think it is time for me to make a call to the company and see "whats up".. Ask a couple of questions and see if all is still well on the SBT front. I'm just surprised because as long as the current R+D SBT are still alive and growing I would assume that long term prospects for this would support the SP in the short term..
This why I wonder....

TGE they are some valid points you raise regarding the YTK business and it's ties with the $AUD. This alone could surely support the re-rating of price that is currently occuring.

 

[truevalue]

Re: CSS - Clean Seas Tuna

Yeh well I'm not exactly a fundamentalist in my trading and this stock is one that I own based on some basic fundamentals and the fact that I really like and believe in the business concept moving forward.

I understand that Lonsec had re-rated their advice on this stock to "under review". So maybe this is where all the recent wholesale dumping has come from... 545355 shares traded so far today another whopping volume number in CSS terms..

Yes, some of the details were sketchy on the recent report but this has long been the case with CSS reporting anyway.. I think it is time for me to make a call to the company and see "whats up".. Ask a couple of questions and see if all is still well on the SBT front. I'm just surprised because as long as the current R+D SBT are still alive and growing I would assume that long term prospects for this would support the SP in the short term..
This why I wonder....

TGE they are some valid points you raise regarding the YTK business and it's ties with the $AUD. This alone could surely support the re-rating of price that is currently occuring.

I think you just have to keep your eyes on the big picture mate. The SBT program is on track and the original SBT are still alive (and are likely to remain so).

590,000 shares is a big number for CSS but in $ terms for your average company as a % of market cap it is not exceptional or even unusual. If an institutional investor lost a mandate and had to liquidate 5,000,000 shares it would take 3 months assuming normal trading. if he wanted to do it in a hurry then in a thinly traded stock like this he is going to have a big impact on the price. While this makes you and I feel like crap, it also makes us question our research and reiterates why we hold the stock in the first place.

Remember in the short run the stock market is a voting machine but in the long run it is a weighing machine. When CSS delivers so will the share price.

 

[Ruincity]

Re: CSS - Clean Seas Tuna

http://www.theaustralian.news.com.au/business/story/0,28124,26055351-20142,00.html

http://www.news.com.au/adelaidenow/story/0,27574,26055109-2682,00.html

http://www.theaustralian.news.com.au/story/0,24897,26054032-643,00.html

There is reference to this in a recent release here: http://www.asx.com.au/asxpdf/20090910/pdf/31kn6qd8tn5p7n.pdf but as the articles above will show the media has gotten all over this..

The CSS article was not even listed as "Market Sensitive".

Anyway back to .525 and momentum has shifted, largest volume spike since the 12th June yesterday and the 12th signalled the start of a bearish trend.
I hope and believe the volume spike signals the start of a much more bullish bias this time.

And this article was also posted on the 9th http://www.portlincolntimes.com.au/...al/tuna-getting-bigger-every-day/1619909.aspx which talks about the current size and prospects of the existing R&D SBT. Starting to look like real fish now and nearing 1kg is quite impressive.

Anyway a heap of news and a much better week for all CSS holders.
Wish I had known about this news a little earlier too as I might have more agressively sought another little parcel - my buy price didn't get hit..

 

[kenny]

Re: CSS - Clean Seas Tuna

Thanks for the links Ruincity. Goos weekend reading.

Hopefully, the SBT project will be considered less a "blue sky" deal in the sp in the coming months.

Cheers,

Kenny

 

[truevalue]

Re: CSS - Clean Seas Tuna

Investor presentation to the BBY conference today. Not much new news but looks like things are still well on track. There is a nice chart breaking down the FY09 result which would have been helpful when they released the result.
Heavy selling seems to have abated.
Looking forward to the annual report and AGM

 

[Ruincity]

Re: CSS - Clean Seas Tuna

There has been a whole load of institutional level selling and still no release regarding which entity has left the register or is partially leaving the register.

Nevertheless shortly after the release this morning I notice a change in the "vibe" no more dumping into buying strength anymore. We are even on target for a blue/buy candle by the days end - it has been 16 trading days since we last saw one of these! Fingers crossed.....

I note this in the key risks section of the presentation:

"Water temperatures too cool for transfer of SBT fingerlings to sea cages"

Would someone care to elaborate a little further regarding this?
I understand that they haven't taken the existing R&D SBT stock into sea cages because it is too cold. Is there only a small window of suitable water temperatures for SBT to survive in S.A waters? I would have thought that the local fisheries currently keep wild SBT fished stock in offshore cages all year round?

 

[tge oracle]

Re: CSS - Clean Seas Tuna

What they are saying is that the juvenile SBT have to be mature enough to withstand cooler water temperatures.
For the best possible outcome they will need to produce SBT eggs/larvae by Nov/Dec. This will allow the fish to grow to juvenile stage prior to transfer to sea pens.
As they grow, space in the incubation tanks becomes a premium so they will be looking to transfer them at the earliest opportunity.
A late summer spawning may create problems as the fingerlings will have to be kept in incubation tanks throughout winter. This could be a challenging if they produce a significant quantity eggs/larvae like last year.

 

[tge oracle]

Re: CSS - Clean Seas Tuna

This unexpected Cap Raising has me concerned. There was no mention of the need for further funds so soon in the annual report released a few days ago.
The raising is to cover the costs of commercial scale production of SBT fingerlings. That's all very well but they haven't spawned yet!
I think my earlier prediction of a dramatic loss of revenue from the YTK business is the major culprit here.
We'll have to wait for more details but I am very wary of un-planned Cap Raisings.

What's your take on this Truevalue?

 

[truevalue]

Re: CSS - Clean Seas Tuna

This unexpected Cap Raising has me concerned. There was no mention of the need for further funds so soon in the annual report released a few days ago.
The raising is to cover the costs of commercial scale production of SBT fingerlings. That's all very well but they haven't spawned yet!
I think my earlier prediction of a dramatic loss of revenue from the YTK business is the major culprit here.
We'll have to wait for more details but I am very wary of un-planned Cap Raisings.

What's your take on this Truevalue?

I had heard a few weeks ago that they were about to announce a strategic investor, which had me worried because the share price is too low to be giving value away to strategic investors regardless of their pedigree.

After reading the auditors report and checking the expiry of the Rabobank facility, I suspect the raising is being done to pay out Rabobank who have been asking for their money back from many of their Australian customers recently (blaming the GFC), and now I suspect CSS.

I have no problem with CSS raising capital to pay back Rabobank so long as existing shareholders get to participate equally in the raising and don't get diluted. We all knew as shareholders that CSS would be raising capital in the future, this has just come along much sooner that previously expected (I would say 12 months early). Whether CSS raises at 0.40 or $1.00 should not make any difference to us as shareholders as long as we get to participate equally - if you dont believe me just do a simple calculation assuming both scenarios, your total investment return is the same. Unfortunately the maths doesn't work if you dont have the cash to follow your rights.

The time has come for shareholders to make a choice - thumbs up and the company lives, thumbs down and it dies. The problem is, we are being asked to make a leap of faith that CSS will have a commercial quantity of SBT in the water in early 2010, whereas before this announcement we would have been dipping into our pockets in 12 months time knowing fully that there were 25,000+ 9 month old fish swimming happily in a sea cage.

This has the potential to be a great company, I have no doubt, but the anti may have gone up too high too early. We shall see.........