We would love to hear your thoughts about our site and services, please take our survey here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Aside from screwing over investors with positive news while actually being in the doo-doo, this announcement only really prolongs the share freeze.
Newgen will run the mine to get they loan and interest repaid. Other debtors will have to wait until they have finished, presumably this is not securitied on any assets?
(Assets which RMM no longer control)
El Professor, comments in line. Yours in quotation, my comments after the >
' If NewGen are the the primary creditor they will take precedence over all else. '
>True
' If Elemental under their deal are classified as a creditor too then they would presumably be behind NewGen for payment. '
>True
' If that is the case why would NewGen let money go out the door to Elemental? '
> Agreed however the timings don't stack entirely. While NewGen would request or insist that other creditors aren't repaid as they are first secured lender over the asset; RMM have said today (first time this is mentioned) that no sale and delivery of refined gold has occurred for the financial quarters ended September 30, 2022 and December 31, 2022.
Payments to the company's principal secured creditor (NewGen) wasn't due to commence until 31 October 2022.
RMM made their update on the financial position 27th October, ahead of the default against NewGen.l as they would have had to.
I'm not convinced RMM would have had to issue an RNS against the gold streaming deal in q3 or even q4 as it was a commitment to fulfil gold supply on an annualised basis. So on a technicality they likely didn't 'have' to issue this until a point they knew that the supply deficit couldn't be met by production for the remainder of the annual term. It's still not an excuse and they've had ample time to inform the market of these constraints.
So in short RMM weren't in default until 1st Nov, after not paying 31/10 and only notified the market on 27/10.
So not supplying anything under the gold stream for q4 starting Oct overlaps fine in terms of NewGen having powers after the default, but not for the Q3 period ending 30th Sept.
In terms of so what's changed. IMO it suggests that the presumption Rambler didn't have a hold on its finances when they were suggesting all is okay was wrong.
It's possible it's something else but the most likely reason they didn't supply anything to elemental on the stream agreement in Q3 (before NewGen default) was because they either a) needed the gold revenues for their balance sheet to run the mine (opex/capex), or NewGen requested it didn't supply the gold.
In which case RMM would have been engaged with NewGen about the risk of default way before they announced the balance sheet risk to the market.
Either scenario, after today's RNS, doesn't promote a very good view of RMM.
Anyway that's my two pence
Atb
The wording a default "has" happened suggests that instalment deliveries were necessary to fulfil the contract and that for example the contract wouldn't have allowed a delivery of 1,200 ounces on day 364 of the first year to be met.
I'd be staggered if we hadn't already defaulted on 1st October 2022
Maybe that's a pure interpretation Prof. Not seen the nitty gritty agreements.
But I think we all agree. This is an egregious way of dealing with your investors, or in the case of those that bought in or added in Q3, future investors.
I can't see how he can defend letting this info be held on to.
Mind you. The whole way the overall financial issue was 3 months latter communicated makes me half think now that there has been a deliberate method to crash this down for someone's benefit, and it's not ours clearly :-(
Hi Strummer,
Thanks for your thoughts.
I think the deal with Elemental was that CEY would provide a minimum of 1200 oz of gold a year in each of the first three years of the agreement. The deal was RNSed in Apr 22 so presumably the first year end is around Apr 23, arguably therefore there is no default until CEY are not able to deliver that in year, hence why the RNS now with 2 or 3 months to go.
I am not saying this is good comms to the shareholders at all and I agree that the apparent pumping of the share over the summer period seems strange however I wonder whether they are legally OK with regards to the Elemental deal in not saying anything until now.
Best wishes,
Prof
Newgen might be the secured creditor but that doesn't mean they have control over the company's finances. Defaulting on their obligations to Elemental is a decision made by the company, not by Newgen. The company may well have been pressured by Newgen to divert the proceeds of gold sales to Newgen, but doing so has just led to two creditors after our blood rather than one. Elemental will be absolutely fuming. If the mine remains in operation there will not be a cent in it for shareholders.
In any case I think the main issue here is lack of transparency - the company is telling us in Feb 23 about a default that took place in Q3 22. There's No excuse for that.
Surely Prof, and as said.
The issue is that TB didn't RNS the lack of payments July onwards of the Au. At the time as guys have said, pumping the "goodness" of the share, and letting people invest without disclosure of this key fact during Q3...
If, if that's the correct reading, and this RNS seems to prove it.... Then isn't that dishonest, nevermind the incompetent financial management demonstrated over the piece?
If NewGen are the the primary creditor they will take precedence over all else. If Elemental under their deal are classified as a creditor too then they would presumably be behind NewGen for payment. If that is the case why would NewGen let money go out the door to Elemental? Presumably it is in NewGen's interest to either have the monies going to them to minimise what is owed to them or have it go to the suppliers who are key for the day to day running of the mine to ensure continued revenue. I would be grateful for any thoughts as to whether that logic is correct of flawed. Best wishes, Prof
>taking a sledgehammer and wrecking the **** out of it
It's a banger m8 trust me bro
Clearly there will be no value to shareholders now whatever the outcome e.g. asset sale, massive dilution, loan with onerous conditions, bankruptcy. It is very disappointing as I invested a sizable amount in good faith based on the data being shared by the company.
Definitely sanctions required against the BOD, but probably they will walk away having pocketed a decent salary for the last few years.
It's like planning to sell your car, first taking a loan taking it to the garage getting everything sorted then parking taking a sledgehammer and wrecking the **** out of it, before taking pictures and posting it on autrader.
If they are they shouldn't be allowed to sell anything not even on Facebook marketplace.
They finally hedged in the 3s. But when it hit 4.2.... nothing.
Has to be something going on in the background strikes me... Even before this latest p*as poor RNS.
Can they be selling it ?
According to the rns in January the company had produced 513 ounces and 401 ounces of gold in the 3rd and 4th quarters and we’re awaiting the assay results. So could this be the reason for today’s rns?
The Hancon situation is far from clear either, why did they need them, what did they do?
There is also Hancon & the non exec directors who took payment in shares, maybe it is going to be sold...
>(as well as purchasing stock himself)
His purchases were pitiful on the grand scheme of things. Could have also been a deliberate pre-meditated act to show 'well golly gee, I didn't know, your Honour, I genuinely thought the company was doing well, see, I even bought stock!'
Thanks buddy, will take a look later when I get home.
>Please link to the discord
Try this
https://discord.gg/dDnzmJCF
This is the main one. There is a further one for those who are happy to verify their holding called Rambler Investor Group. Believe last update from Know0 was that they are looking to speak to a legal representative as a collective (of verified shareholders) to formally engage BoD.
I have defended both TB and RMM for its perilous financial position previously as I felt they had been quite unlucky in some respects, for example the timing of an inflation/falling copper price at a time of a rapidly expanding mining operation.
However, today's announcement has finally confirmed the true position we are in. Even ignoring the fact that RMM for the past 8 months have almost certainly been failing to comply with disclosure requirements (this cannot possibly be argued as being immaterial to the share price), it has shown that the way the company has been managing cashflow has been nothing short of mind-blowing.
He has continued to invest in exploration/increasing the resource base even as the balance sheet was approaching a cliff edge. He has closed off the option of raising part of the required finance by drip-feeding bad information into the market to hammer the share price prior to suggesting a raise may be required. He has entered into offtake agreements when at the time of being entered it should have been abundantly clear to him that unless copper prices remained at an all time high a default on the new offtake would be inevitable due to the large existing debt with the secured lender.
I previously gave him a pass as I truly believed he couldn't be as bad as to sleep-walk this company into the abyss given his continuing positive sentiments and belief the share price was materially undervalued (as well as purchasing stock himself). Given the information we have now, it is exactly what he has done. It has to be time to go
Please link to the discord
>Law experts. Your take?
Stop fumbling around and join the shareholder discord group. Your holding is significant. They are coordinating on a response.
Exactly.
As I said below. If they stopped shipping Au to the agreed party in July. They have to have RNSd it.
They let people invest right up to the much later financial screw up RNS.
I know AIM is wild west..... But that has to be BOD accountable.
Investors will have invested in Q3 with no knowledge of the above.
Law experts. Your take?
They need to be held to account to be honest. They have shafted a lot of people. Not just those with investments trapped in this but also those of us who took substantial losses exiting when it became apparent that the company were misleading investors.
Whilst they were busy defaulting on Elemental TB was busy ramping the company in interviews with information like 8000 annualised production which was clearly a one off monthly total and not sustainable.
Smart punter,
Whe you say 'How could they deliver gold when they do not own a mine?
All production goes towards repaying the bridge lender, who are secured.'
I understand what you mean and you're probably quite right there. That said, the statement about Ramblers financial position wasn't issued until 27/10 well after the end of Q3 which apparently was also defaulted with Elemental.
So for them to default Q3 on the basis of NewGen owning the asset, as first secured lender, doesn't stand for the the entire default period with Elemental as they hadn't defaulted with NewGen by then, it also wasn't mentioned in the financial statement RNS in October.
What it does suggest is Rambler were more aware of their financial issues during Q3 than previously thought, weren't fully transparent and decided to pay either creditor, elemental or NewGen, even before they defaulted with NewGen.
It's possible in Q3 they needed the gold for opex/capex and then after default NewGen said they can't pay other lenders from Q4. That's most likely IMO.
Atb