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Sand, why are you here with such a terrible outlook? SXX is down, but certainly not out as you're putting it.
Yes, we will likely see a strategic investor come in... We still have off-take agreements... It's also better for a strategic investor to come in with less shares in circulation too, think some people are very quick to forget that. I think it'll likely be a mix of cash to us - shares/warrants/future profit to them - they'll still be greatly rewarded.
This company will not be the same if it ever manages to obtain further funding to complete the construction project and get into production, so hoping on divi payments sometime in the future to negate your losses is at best naive and at worst just plain bonkers, the strategic partner if found will in all likelihood want total control of SXX and not for a few billion shares either, it will be at the cost of current investors who will get diluted to death, that's if they can even manage to find a partner, to all intents and purposes this company is now in fire sale mode, the clock is ticking and the cash is running out, sadly SXX is now between a rock and a hard place
Hi all
I have only been invested here for 6 months but with 700k shares at an average cost of 15p, like many others I have taken quite a hit on this investment.
There have been numerous postings on this board by investors either giving up, and crystallising their losses, or sticking with the company in the expectation of “it’ll be alright on the night”, and I have been giving serious thought about whether to hold on or bail out.
Having just come back from a long walk by myself, giving me time and peace to think about this some more, I have decided to hold for the moment for the following reasons.
From what I have read the sale of 13mt, at a profit of £85 per ton, would equate to an annual profit of £1.1b and if £700m of this was allocated as distributive profits to shareholders, which currently stands at 7b, the dividend per share would be 10p. However, if there is a strategic partner involved who purchases 5b shares @ 5p (£250m), the total shares would be 12b and the dividend reduced to 6p per share, which is still a yield of 40% on my average cost.
With 700k shares my dividend income, at 6p, would be £42k and would repay 90% of my original capital outlay in 2 years irrespective of any increase in share price during that period.
So for me, the significant potential for dividend income out-ways the current paper capital losses and strongly suggests I should hold, even taking into account that this is still a risky share.
I fully accept that my average is lower than many on here and if your average is 20p, the 6p dividend is still a 30% yield and the dividend income would cover 90% of your capital cost in 3 years.
Also, once this company starts making a profit and paying a 6p dividend, surely the Equity Income fund managers will be buying into this share and taking the price to £1 with a yield of 6%
All the above are my thoughts and opinions and are not to be construed as advice.