Stephan Bernstein, CEO of GreenRoc, details the PFS results for the new graphite processing plant. Watch the video here.
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You do go on and on...
And neither of those posts says a bid will come...
Even Nick countenanced what he would do if a bid comes in...it would have to be a very high price and closer to NAV...
Redknight on 18 Feb 2021 14:42
Part of text pasted in below, but please feel free to read whole text.
Finally in the February 2020 MD&A we get the detailed outline plans for a PFS, including this...the first mention of production...
"Process flowsheet, process plant design, equipment requirements and cost estimating will be prepared and signed- off by Wood."
And of course no decision is made to move towards production until the completion of the Definitive Feasibility Study...which is now scheduled for Q1 2022...
So the certainty that Alpala will be taken to production exists only in your mind Quady...
18 Feb 2021 13:51
Question is...does he sell when a bid comes in...or even if the SP spikes on a JV announcement if there is one...
18 Feb 2021 11:36
I repeat...Solgold will NOT bring Alpala to production on its own...and indeed it risks making itself highly vulnerable to a takeover by seeking to do so...
I could go on and on.
"I can see their position slowly changing.
Already it has gone from no way can we pay a dividend to technically we can."
Also show me any post which shows my position is changing.
Also I have been crystal clear on my opinion that the company will not have enough accumulated profits to pay a dividend before 2030.
THAT is my opinion , but iI am NOT saying they won't pay a dividend.
I'm afraid I agree mate...you really do need help...
How me one post where I have PROMISED we would be bid for...
One Post...
Here or on ADVFN
I am fed up with your blatant lies and misleading statements.
that's not what FN say about 12%.
Jerry you have been promising people that we will get a bid, addicknt is trying to say I am promising people a dividend, to try to deflect from himself saying constantly we will get a bid.
I have maintained given what we know up to now, that Solgold going to production is the most likely outcome.
Some of the discussion on here is ridiculous.
I can see their position slowly changing.
Already it has gone from no way can we pay a dividend to technically we can.
Just a quick message .....£1:32 you can have my shares but not anytime sooner gla DYOR.
Top stuff red. Everything you said was quality. A couple of days ago I called the q man out for being a bully. Sadly I have been proven right by the antics since, and obviously before too.
He doesn’t even have the self awareness to realise when he has lost the argument. He just changes the subject and claims that proves his point! He needs some serious help.
But it does have a bit of comedic value I suppose.
hi red some sterling posting from you mate but take a rest is my advice and post a little less ? When nearly every-other post is your own, one knows it's time to ease down ? ;D
Redknight I have mislead no one, it is the likes of you and addicknt that have promised people that we will be bid for.
I believe debt carry is now called debt capacity, same thing.
That is an excellent and succinct summary rcgl!
And as you realise, debt has a cost, whether you pay it now or roll it up to the future and it has to b e accounted for annually, thereby reducing profits or increasing losses ...
The current estimated annual debt cost of $3 Billion is c £160 million at achievebal borrowing rates on the North American market for a project like this.
So that would require 132,000 ounces of gold EVERY year (before costs) or 56 million pounds of copper ore, or.. 8.3 million ounces of silver just to cover that
Oh and bTW for those who want to throw in Royalty streams as alternative funding, the current interest cost equivalent, stated clearly in the Franco Nevada agreement is 12%, so that would require 200,000 ounces of gold every year GROSS equivalent.
In fact if we have an AISC of $1200 a year for Gold, you would need to mine 448,000 ounces of gold a year just to cover the interest costs.
And finally, for those thinking equity is an alternative, there is always an opportunity cost to equity and guess who pays...US.
What would be the Solgold share price if $3 BILLION equity was issued to fund Alpala...?
All the best and signing off...
RK I think "Debt is a capital item...profits and losses are a revenue item..." is the key point here.
The distinction needs to be made between the balance sheet and the income statement (or profit and loss account).
If I understand correctly, when the company borrows money this debt will be entered as a liability on the balance sheet with a corresponding entry of the principal amount as cash on the asset side. The principal amount borrowed is not shown as income on the income statement.
When Solg is constructing the mine at Alpala I assume it will just show a loss on the income statement for some time as it will be spending a lot of money on construction and not generating any revenue. Regardless of this being funded by debt, that debt principal will not be shown as income and therefore Solg will only be generating losses to start with.
If the income statement is only showing a loss, there will be no profits to pay a dividend out of. And also no profits will have been transferred onto the balance sheet as retained earnings (which I assume is what a company can pay a dividend out of even if it makes a loss for the current period in the income statement). Solg will have no profits and no retained profits to pay any dividend for some time, I am guessing.
Debt is a capital item...profits and losses are a revenue item...
Please explain what you mean by 'debt carry'?
If you mean not paying the interest and carrying it with the principle...'rolling it up'...you cannot escape the debt consequences.
The notional or deemed interest still has to be charged to the Revenue Account, thereby adding to accumulated losses or reducing profits.
Also if it was debt in the form of a Bond, you cannot escape either amortisation or fair value adjustments, either or both of which would add to or detract from Losses/Profits...
Try and come up with an other wriggle that demonstrates you don't have the first idea about Company Accounting and/or Company Law
Hi Redknight and addicknt, nowhere have you mentioned how debt carry is accounted for, you keep mentioning accumulated losses, can you confirm that debt carry only has the interest included in that calculation, and so you could pay a dividend in year one, assuming with debt carry, you showed a profit.
Hi addickt...this was the point that you wanted me to address:
"I believe dividends can be made in certain circumstances where an accumulated loss has been incurred and is done so by an application to the High Court. " and...
"The audited balance sheet is presented in a different way to that of UK companies and I'm assuming it's drawn up in accordance with Aussie regulations? Specifically, they don't seem to 'balance' it in the way we do.
However, and this is where it relates to yesterday's discussion: The company has accumulated losses of several hundred million dollars, but the 'Equity Value', as they describe it, is positive to the tune of $395m, much of which is accounted for by the Share Premium entry.
In my understanding, the fact it's positive would, technically, allow a dividend. Of course, any such dividend is unlikely for years, unless a partial disposal is made, but is my thinking correct?"
I shall answer the first here but may need to run on into a second post for the second.
My primary source will be ICAEW of which I am a Fellow, having practised both Audit and Accounting and Finance.
I assume we can rule out 'distributable profits' until 2032 at the earliest...
"Directors should consider whether there are losses arising since the date of the accounts that have depleted the distributable profits available at the date of the accounts. If there are, then the directors should not pay or propose a dividend out of distributable profits that no longer exist, as this would breach capital maintenance law."
'Distributable profits' are:
"The profits of a company that are legally available for distribution as dividends. They consist of a company's accumulated realized profits after deducting all realized losses."
So even if Solgold were to make a net profit from 2026, this must first be set against all the accumulated losses, which have arisen out of annual administration, operating, exploration and other ancillary costs in the years since SOLG inception in 2005 . These are shown in the Half Yearly Report released on Feb 12 as $141.392 million (and remember its Solgold we are talking about, NOT Alpala, because the parent is paying the dividend. Q may have overlooked this.)
By the way, Solgold is London listed so the Accounting has to be in line with British and International Accounting Standards.
I'm not sure what you mean by "they don't seem to 'balance' it in the way we do". You may be used to 'side and side' Balance Sheets but the 'vertical' approach used in the RNSs has been common for many years. You will see that 'Total Assets' and 'Total Equity and Liabilities" are exactly equal in the Quarterly Financial Report in Canada and similarly in the RNS Half Yearly Report.
TBC
I agree with everything you say Lunch Money and sadly, having reviewed every presentation and webinar on Youtube and Twitter, every PEA, MRE, NI 43-101 and corrections, I have come to the conclusion that the RNS on 15 September not only clarified things finally, but gave a clear direction to management as follows:
"SolGold acknowledges the defaults raised by staff of the OSC as a result of its review. At the request of staff of the OSC, SolGold will address these through the removal of references to the superseded PEA and filing an amended MRE#3 on SEDAR. It is expected the amended report will be filed by the end of September 2020. As the 2019 PEA results have not been carried forward in the new technical report, SolGold will not refer to the 2019 PEA results in ongoing public disclosures and reiterates:"
The sad thing is that this action was almost certainly triggered by a complaint by CGP to the OSC, severely embarrassing the Board and all of us shareholders.
This note was restating an instruction given in April 2020 and yet presentations were still being prepared and given up to July 2020 and beyond, either with the incorrect information (3.6 years) or, more euphemistically ("very fast payback")
Unfortunately our friend on here who worships at the shrine of the senior individual concerned, took every word as gospel rather than you or I, spotting the anomaly some time ago and then checking it out in the PEA itself.
This was the original correction in April 2020
""As a result of the completion of MRE#3 and the impending release of the NI 43-101 technical report, the PEA will be effectively superseded by the MRE#3 technical report as the current technical report on the Alpala Project and should no longer be considered current." (SolGold news release 7 April 2020)"
I believe the intent was to get the SP up towards the NAV, but ultimately the persistent disappointments, the 'demotion' and the Board taking the reins have ultimately had the opposite effect...
Thanks Andy...made my day.
I can assure you and everybody else that I mean no malice, but...
Its just like Trump...I won't accept the posting of complete rubbish that could adversely affect the judgement of decent posters on here.
Also I won't accept blatant insults when the insulter is blatantly in the wrong and systematically either fails to acknowledge that, but especially to not apologies.
That is ungracious in the extreme.
A typical narcissist is often a bully...they can never be wrong...they will argue black is white...misconstrue or, misquote or manipulate somebody else's opinion to fit their own myopic view of the world...accuse others and otherwise attack an individual rather than their constructive arguments...etc.
I apologise that I have ever stated my qualifications or experience on here. It has only ever been done to validate the facts, opinions and research that I post. To be fair, the person in question has done the same, announcing that he was a trainee actuary and implying or stating that makes him excellent in numerical tasks...
`but he then goes on to expound on Accounting, Finance, Corporate Finance, Treasury, Legal and other topics on which he clearly actually knows little, sometimes supporting these opinions with something he's dragged from the internet that he then demonsttrates he still doesn't understand.
My charitable conclusion is that, because he's so desperate to be righty in his opinion that Solgold will take Alpala to production, he will collate any arguments, opinions, false data, misquotes, attacks and insults to defend his position.
Everybody knows mine:
Solgold will be unable or unwilling to take Alpala to production on its own.
Either they will need a joint venture, they will need to sell it, separately IPO it or ultimately be vulnerable to a bid for the company that very few of us would have contemplated even as recently as November.
But in the aftermath of NM's 'confetti' communications; 'shock and awe' presentations (delivered in a monotone and inability to meet almost any deadline, the Board and its Alpala Project Committee have taken control.
The upshot is better governance, more openness, a further delay but with an absolute determination to assess all options and attendant risks and then to deliver solutions that are in the interests of ALL shareholders rather than a narrow few.
How do I know this? Because I am in regular communication with informed persons.
Meanwhile, having read the entire PEA I am certain that the PFS exercise will clear up anomalies, thoroughly review everything, recalculate as appropriate and come up with a viable, attractive evaluation of Alpala as a basis for Financing.
The trouble is that the scale of it, for a company with a MCap of £470m inevitable means we will need help.
PS I haven't forgotten about you addict.
Hope this helps...AIMO as usual...E&OE
Hi RK.
I have much enjoyed your exchanges with Q.
It is so good that someone has taken the trouble to do some proper research into our company to show what rubbish he talks. When he replies to posts he seems to deliberately misunderstand the contents or perhaps possibly is not capable of proper comprehension of them (I wonder if English is not his first language?).
I loved the the definition you posted of a narcissist - I think the writer must have used Q for a case study.
Please keep posting.
Andy
First of all...thanks Lunch Money...you've actually read the PEA and confirmed that it takes 8.5 to 8.8 years from start of construction to break even...
So even assuming construction begins in 2022, that means it will be well into 2031 before breakeven...
However, if you look at the Graph on page 409, it actually shows the breakeven on cashflow in year 8 after PRODUCTION..., so that takes us to 2036...
Quady keeps quoting the PEA as his defence against the dividends argument that addict put forward but, despite being retired and having the time to post 4,807 times and rant at decent people, he still declines to do the decent thing and read the PEA or even scroll down to page 409 and then apologise to addict.
And then he compounds the felony by resorting to insults and untruths again by posting:
"As an ex CEO you seem to roll over at the first hurdle and say woah is me, we have competition , we better sell the company fast, as I don't know what to do."
There is no evidence anywhere on any of my posts to support that last statement.
Lunch money, I’m used to projects taking 2-3 years to build and commission so the cash flow is all outwards during construction. Then there is the commissioning phase, then some steady state, then shutdowns for minor and major outages and targeted debottlenecking. You use BPV and IRR techniques to rationalise cash Flo over the life of the investment, starting from when the first sod is turned, in year 0
OK Redknight this is my last post on the subject, as you are boring me.
The 3.6 year figure is the payback period on the PEA.
It doesn't mean we will pay it back over 3.6 years, it's just a financial measurement.
When the PFS arrives, we are told the resource will be greater over a wider area, with open cut, that is cheaper and quicker to build, and revenue will be on increased prices for gold, silver and copper.
We will debt carry, and taxes will be offset, we will be in profit by the end of the first full year.
So yes I believe we have options and do not need to go cap in hand to BHP or anyone else.
As an ex CEO you seem to roll over at the first hurdle and say woah is me, we have competition , we better sell the company fast, as I don't know what to do.
Quady
You keep quoting the PEA as validation for your argument that dividends could be paid as early as 2024...
READ THE PEA
Until you read the PEA you have zero credibility...
I've read all 438 pages AND the revised version...yesterday and today...
Its quite clear...NM was wrongly quoting 3.6 years. the PEA clearly shows 8 years...
I will keep saying read the PEA until you've confirmed that you've read the PEA.
You demanded substantiation for what addict and I said.
Its in the PEA in black and white...and you won't get a revision util the PFS comes out.
So READ THE PEA.
Interesting Redknight you believe the PEA and quote interest costs, but at the same time say we will have dilution if we go it alone.
Which one is it please.
I understand that Redknight, but we can debt carry.