Nanalyze

What’s happening with Obducat?

Obducat_Logo

One company that attracted a great deal of attention from nanotechnology investors during the nanotechnology hype of 2004 was Obducat (OTCMKTS:OBDCF), a Swedish company supplying nanoimprint lithography solutions. The interest was so great that it prompted Obducat to list their shares on the OTC market as an ADR. While there are plenty of other companies in this space that show promise, many Nanlyze readers continue to express interest in this company.

The first thing to look at when sizing up a company’s current health should be the financials. Unfortunately Obducat stopped publishing their financials in English around 2009. This means that unless you can read Swedish you won’t be able to assess what’s going on under the hood. However, using Google Translate it’s possible to get a glimpse into what’s been going on at Obducat by looking at their latest 2012 annual report.

Obducat_Financials

 

The first line above represents revenue. Assuming this is represented in 1000’s SEK then this translates to about 5 million USD. It is troubling to see a trend of decreasing revenue since 2008 with 2012 revenues less than half of 2008 revenues. The second line represents cost of goods sold (COGS). While it is good to see this trend decreasing, we would expect to see COGS fall alongside revenues. We do see COGS decrease as a percentage of revenues from 42% in 2008 to 27% in 2012. The fourth line is operating expenses which are seen to be fluctuating dramatically over the past five years. The last line shows profit for the year. After four years of heavy losses Obducat shows a profit in 2012.

For American investors Obducat is difficult to invest in given the lack of liquiduity as an ADR and the fact most of the company’s content is in Swedish. The trend of descreasing revenues is not promising. Looking closer to home, ASML is the world’s leading provider of lithography systems for the semiconductor industry.

ASML_Chart

If you invested your money in ASML five years ago you would have realized an almost 200% return on your investment. In a future post we will look at another promising private company, Molecular Imprints, that is backed by Harris and Harris Group that currently selling nanoimprint lithography systems.

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  • ObducatHolder

    Obducat expects to deliver a NIL pilot manufacturing line to Kimberly-Clark during the fourth quarter this year which is an order valued at about 2 million US dollars. Does anyone know if the company has a quarterly earnings report out for 2013?

    • Nanalyze Editors

      Yes, they have an interm report for the first 6 months of 2013 available in Swedish. Translating from Swedish using Google Translate, the report stated that order intake for the first half of 2013 was 3.43 million USD which is lower than the company expected. Net sales for the period were around 1 million USD.

  • Rangoon

    Looking at the finances in Obducat it tells me that the company won´t survive for much longer. What happened to the other pilot-lines they delivered? That was yaers ago and as far as I know they haven´t got any follow-up-order on these. They also have reduced their staff by almost 80 percent the last years and without technicians and money it is hard to see how Obducat is going to be able to deliever any kind of tools specialized for industrial production. The reserach macines is a completely different issue and have not much to do with massproduction. If there was someting big going on with Obducat involved we for sure should have seen some more action in the stock at pink sheets. Instead the stock is completey dead.

  • Astroid

    I´m from Sweden and I can tell all of you that this company is a fake created by some criminals. Just look at the history of the chairman Henri Bergstrand!!! A well known scammer here in Sweden. Another fake is that theit CTO Babak Heidari calls himself Dr of nanteechnology when he havent even graduated from the basics degree. Big big warning for this very shameless company. Some people here are now working on a prosecution against the company and its boardmembers.

  • Mr Zebra

    I´m sorry but Obducat is no more. The Company seems to be bancrupt and today they sent their liquidation papers to the authorities. The boardmembers will also probably be prosecuted. Some of them have been spreading false rumours about the company at different swedish and german stockrelated websites, probably here to some years ago.
    Here is a link to a Swedish newspaper that are demanding that Obducat should be thrown out of the stock market because of suspicious fraud.
    http://blogg.sydsvenskan.se/frostberg/2011/01/08/bolag-som-obducat-har-inte-pa-borsen-att-gora/

    • Krof

      Mr Zebra, why do you lie?

    • Nanalyze

      The English translation of the blog post Mr. Zebra is referring to is seen below. It seems there are significantly differing opinions as to whether or not Obducat is involved in any fraudulent activities. All of the below was taken from the above blog link using Google translate.

      ****************************************************************************
      Week two extraordinary general meetings of Obducat showed up a company where management seems to devote as much energy to financial acrobatics that the development of the company’s technology and products.

      Malmo company Obducat has been under fire many times before, partly because of a record order that suddenly disappeared and lies around a mandate from a major shareholder at a general meeting a few years ago. But the question is whether or not this week’s decision to allow a foreign finance company investing in Obducat through 75 mini emissions – and then sell the shares as fast again – is the strangest decisions taken at any of the company’s meetings .
      Management with Chairman Henri Bergstrand and CEO Patrik Lundström have often felt unfairly treated by the critical shareholders and intrusive media. They believe that everything they try to do is to build a world leading company in the field of nanotechnology with Malmo as a base .
      If the company’s technology really is a world leader is impossible for outsiders to determine, but it really does not matter in that situation. Success requires more than the best technology and it can ultimately be very different factors that determine who wins the match. Financing is one of those factors. Here Obducat has a remarkable history of getting along with a wide range of issues aimed at private small investors .
      While I have always favored the idea that small shareholders will have the opportunity to be involved early and invest in new development , but in Obducat cases , operations have long and largely focused on pure research, where funding should have been resolved in other ways until development progressed further .
      The small shareholders can never guarantee the long-term financing needed to bring new and revolutionary technology all the way from the research lab to the market. It creates unnecessary stress for both the shareholders when they realize that their investments must be followed by more and for management who has to devote time and resources to keep the 15 000 shareholders informed , arranging large meetings and handle other financial administration.
      Nevertheless, it’s now time for Obducat to gather more money from small proprietors . On Monday pulls next issue started , this time a convertible loan of 77 million , which expire in 2014.
      In the shadow of this issue , management has finalized a second solution where a finance company * goes into the SEK 30 million , divided into 75 mini issuance of a maximum of SEK 400 000 each. This implies that management receive on average engage in a new teeny issue was the twentieth day over the next four years.
      What is not revealed in the basis of Extraordinary General Meeting on Monday is that the agreement with the finance company based on one of Obducat principal owner lends a portion of its shares in order to finance the sharks * can implement so-called short sales where they sell borrowed shares and then buying them back cheaper via the 75 mini emissions.
      How this will affect the share price , nobody knows , but it will likely be a bumpy journey for the small proprietors in the future.
      Who is the principal owner who lends shares are – or if he gets paid – we do not know either, because no information was provided on this.
      The combination of technological development in the very early phase , many small shareholders , lack of long term funding , and finally a dose secretive financial acrobatics allows a company Obducat should not exist on the exchange.
      Things to Consider
      When you invest in small caps , you must have a very different risk appetite and stamina for several reasons:
      1. Technology always takes longer than the corporate managements states. Delays and negative surprises among the game’s rules. They say two or three years , you should expect seven to ten years .
      2nd The transparency of the small development is significantly worse than in large companies. Are traded small companies on lists with lower standards, and are rarely independent analysts who follow companies.
      3rd Many small caps are still dominated by the founders. Although the Board shall ensure all shareholders get that small investors can expect to sit in the back seat while the founders control .
      [* Footnote: Given a description of the finance company as ” Jersey based ” might be misunderstood , this formulation struktis following remark from a reader. As stated in other articles about Obducat in today Sydsvenskan , where this column included , is the finance company Yorkville Advisors U.S. and Jersey City, NJ as the base. ]

      • Krof

        “Publicerad den 8 januari 2011” = A 3 years old article.

  • Nanalyze

    Thank you for that heads up Mr. Zebra. It is as important to caution investors against what companies not to invest in as it is to expose them to companies that may have great potential. If in fact the company was defrauding investors then it is great to see prosecution being pursued.

  • Krof

    “January 22 2014 11:00
    Obducat: Obducat confirms installation of the NIL pilot manufacturing line at Kimberly-Clark
    OBDUCAT, leading manufacturer of lithography solutions based on nanoimprint lithography has completed the installation of the “first-of-its-kind” NIL pilot line at Kimberly-Clark facilities in the US.
    Obducat and Kimberly-Clark entered into a Joint Development Agreement in June 2011. In May 2013 Kimberly-Clark placed a purchase order for a Sindre NIL pilot manufacturing line with Obducat.
    In November 2013 a Factory Acceptance Test was concluded at Obducat facilities and now the Site Acceptance Test, performed at Kimberly-Clark facilities in the US, has been approved.
    The pilot line will be used for production of medical devices being developed by Kimberly-Clark. The FDA approval process is ongoing and provided that the approval can be obtained a ramp into high volume production is targeted.”

  • Krof

    “8 november 2013
    OBDUCAT, leading manufacturer of lithography solutions based on nanoimprint lithography and electron beam lithography, coordinates a transnational project, named ANILP, initiated through eurostarsTM. The project was given ranking no. 10 out of 510 eligible applications by the independent evaluation panel. The project is focused on developing a new manufacturing platform for advanced nano patterning on large area surfaces based on Nano Imprint Lithography (NIL).”

  • Krof

    “January 28 2014 08:45
    Obducat: Obducat secures a Sindre® 400 NIL-system order to be used in mass production of LEDs
    (OBDU B)
    OBDUCAT, leading manufacturer of lithography solutions based on nanoimprint lithography (NIL), has signed a contract concerning supply of a Sindre® 400 NIL system to be used in mass production of µPSS LEDs. The expected revenue value from the contract, which includes the NIL system, consumables as well as service and support during the next two years, is estimated to total 22 MSEK (EUR 2.5 million). “

  • Krof

    “February 13 2014 13:04
    OBDUCAT PARTICIPATES IN EU FUNDED PROJECT GREENANOFILM
    OBDUCAT, — has been invited to participate in an EU funded project, named GREENANOFILM. The project is focused on development and application of ultra-high resolution nano-organized films for next generation opto- and bio-electronics. —
    The project is coordinated by CNRS (CENTRE NATIONAL DE LA RECHERCHE SCIENTIFIQUE) from France. The consortium consists, in addition to CNRS of eight distinguished partners —
    The project will start in February 2014 and is scheduled to run over three years with a total budget of 5.2 MEUR.”

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