Member Info for Agricore

McFc, I'd say any sorting would need to come through immediately as an RNS. But I was encouraged by the talk of "further updates in this area soon" (which might refer to Burwell or Tring)

Meanwhile I was pondering about negative comments about nickel demand. While there are different views the 2 views I find most persuasive are Rystad and Goldmans. Both are bullish on nickel. e.g.
https://www.rystadenergy.com/newsevents/news/press-releases/nickel-demand-to-outstrip-supply-by-2024-causing-headaches-for-ev-manufacturers/

I've topped up again today at 42.7p. Looking at my trading history here's an encouraging thought. I originally bought in April 2020 (which by the way is inaccurate as I owned REDT before this) but anyway bought (more) at 45p in April 2020. I sold 50% of that in May 2020 at £1.01.

So that illustrates how the winds can change dramatically. And they will. My advice would be keep the faith there are numerous pending news updates that could drop in 2022 that reinforce my conviction with IES:

> LODES - long duration energy storage phase 2 opportunity - potential upside not in the price. The "if" IES can demonstrate capability isn't in doubt in my mind. The 2021 endorsement from Siemens dispels any doubt in my mind.
> Siemens - next generation co-development - potential upside not in the price
> US regulation change - Federal Energy Regulatory Commission (FERC) Order 841 (2018) removed barriers preventing storage from fully participating in load shifting markets. - there a growing number of US reference sites coming online in 2022. I think the potential to drive further sales on the back of those is significant.

I'd also point out that energy storage ITs are trading at 12 month highs (e.g. Gore St). IES is a picks and shovels play on that buoyant area. Why has IES dropped? In my opinion the market is lumping "growth" into a big bathtub and shorting the heck out of it. Peering into the bathwater you need to ask yourself 2 simple questions: Is there a baby? Do I have patience (and conviction) to wait?

GLA

Really appreciate the link to Scott's presentation and explanation.

Confirms Tring Road is a 6th shot on goal - a potential peaker and battery storage hybrid. Looks like Gas is back on the menu boys!

New presentation - worth a look:
https://www.corcelplc.com/wp-content/uploads/2022/06/202206-2_CRCL_PPT_FINAL.pdf

I noticed at the end of the 22nd June RNS the following phrase: "We expect to have further news on our battery storage portfolio shortly." It is annoying that Mark the interviewer doesn't quiz Scott on this. But it can only be progress on either Tring or Burwell...... can't it?

GLA

Lithium vs Vanadium per MWH.

Another little nugget I worked out this evening listening to the CEO from Corcel is that the relative cost of a lithium battery is around £130,000 per MWH.
The VRFB economics are approximately $32,000/1.25*26.7 = £683k per MWH
So just over 5x more expensive. However we know the Lithium can work over 2k-3k cycles (with reducing levels of efficiency and generally can't be recycled) while VRFB are 12k-14k cycles but can then be recycled (the vanadium is re-used for addition to steel).

So in other words at current prices IES' product is actually cost competitive (arguably about 20-30% cheaper) than Lithium and of course has other advantages (safety, duration, longevity, better ESG credentials) which tip the balance towards vanadium.

Another reason to feel pretty bullish about IES and to look past today's move downwards.

So running some more estimates over today's numbers - if IES could win every one of the 686MW bid pipeline tomorrow, that would translate to around 18,179 units and each unit sells for around $32,000 so would be revenue of $581m! Using the 2022 figures below the cost of production would be $26,700 so would total $485m = so would drive a gross profit of some $96m.

I'm not suggesting for a minute that this can/will happen - and that every sale will convert and that IES have infinite manufacturing capacity but even at today's economics it certainly gives you an idea, and given the estimated drops in production costs year on year, today's results give the most concrete evidence yet that this isn't just a neat idea - the numbers actually stack up too - and importantly in today's "growth is bad" market cash flows aren't too far away.

In fact IES are talking with Baojia to do contract manufacturing. So even if the above is an extreme example fantasy, perhaps we can see a faster ramp up than currently anticipated.

NB I would also point out the Gamesa JV has potential to drive revenue too.

Canacord genuity put the 2021 figures at 4 MWH and SP $33,800 CP $77,200 - so a loss per MWH.
However the forward estimated economics through to 2025 improve dramatically and they foresee breakeven in 2024 with a (lowered) target price of £1.75

You may need to transfer this raw data to Excel for it to make sense:
$ m, except per share
2020, 2021, 2022E, 2023E, 2024E, 2025E (E is estimate)
Operating measures
Modules sold, 21, 112, 450, 700, 1850, 4,250
Capacity sold, MWh 1, 4, 17, 26, 68, 157
ASP, $ 000 / module (ex ancillaries) 27.0, 33.8, 31.7, 32.0, 30.4, 28.9
Mfg cost, $ 000 / module 73.3, 77.2, 26.7, 23.8, 21.3, 19.2

Steph, I don't think it's that simple to publish commercially sensitive information about GROW's portfolio (if indeed they are allowed to - there is usually a confidentiality agreement in place between a VC and investee in my experience).

The resolution in my view to tighten the belt, manage cash, and let the most publicised recession (ever) work its way through. Commence buy backs if the discount persists. I am fairly relaxed on both inflation and interest rates. Inflation has been substantially resolved through innovation for decades and the pace of change is increasing. AI, genomics and quantum computing will drive major productivity improvement. Supply side snags are subsiding and there's plenty of evidence that inventories are at high levels in many businesses. I'm relaxed on interest rates because I don't believe governments can afford to increase rates beyond about 3% because of deficits. So we will probably see QT instead.

Grow has a track record to .... grow. So no doubt we shall see this continuing. Possibly at a slower pace for a time. The main challenge could be slower realisations, but it's not as though GROW doesn't have a war chest to see it through and would be a forced seller.

The discount to NAV is tremendous so today's reversion is hardly a surprise.

1. £40m valuation for Mambare. Some talk of an invitation to visit Korea to agree a MOU and commence offtakes of Direct Shipping Ore. Align discount it by 90% to arrive at a £4m valuation.
2. Align say the WoWo Gap valuation is £3.2m however 890 thousand tonnes of nickel @ $24k/tonne and 66 thousand tonnes of cobalt @ $82k/tonne is $26.8bn worth of resources.
3. Altana partnership will fund energy storage projects; if Corcel pull its finger out and can arrange some then there's project/arrangement fees which it can earn in 2022.
4. Burwell is a "shovel ready" 100MW project (solar and storage) which Corcel own - on the books at £90k. Align reckon it's worth £1m-£2m even at this stage and would be worth circa £40m in 2025 once operational.
5. Demspter - Vanadium 50% owned - on the books at £250k. Worth £1m according to Align.

The 2021 accounts show net assets of £4.5m including the above. If there was a fire sale tomorrow you have to ask yourself would those assets only sell for £4.5m? Or one third less than £4.5m?

I ask this because today's market cap puts the entire business at £3m which seems to be incredibly cheap.

You can't deny the communication has been poor and "suddeness" of Avonmouth Peaker's demise is a disappointment but you have to stop and wonder..... is there a baby in that bath water?

My bad, yes I meant $8.4m

I’ve been reading about what’s driving the demand and supply and I found this article is very interesting and supports a higher tin price from August:
https://www.reuters.com/markets/commodities/high-flying-tin-takes-tumble-tightness-eases-2022-06-17/

FK, there are strict rules about buying shares in "closed periods" i.e. where they are privy to information that could be construed as "insider knowledge". The fact that there are numerous reports and assay results pending is a great illustration of this.

So when you say we can't know the reasons for BOD not purchasing more shares I have to disagree.

GLA

Boohoo, What has changed here is the price of tin: Currently $26,825. This in turn is partly down to increased supply e.g. from Malaysian Smelters have increased tin production 20% and also Tin has followed Copper downwards in the negative sentiment.

Recapping the fundamentals at this new price:
> AISC for 2022 predicted to be: $20,500
> Based on a 800T production year and assuming 6 month average $36,000 and 6 month average $26,000 (so $31k overall) places us on a $10.5k per tonne profit is still $84m EBITDA and growing
> Zero value being attributed to Lithium. Lithium has not dropped in price as of today.
> Zero value being attributed to Tantalum. Ditto on tantalum price.

So in my view ATM price fall is part of the recession despondency and capitulation. Great chance to top up and I've taken that opportunity.

GLA

There were 2bn tonnes of waste generated in 2021
Eqtec reckon they can generate 930KWH per tonne using gasification
If all waste were converted, that's 1860 Terrawatt Hours of electricity
IF every single tonne could be gasified, and IF Eqtec could build an infinite number of plants could it power the world?

Answer: No. But it could generate 7.8% of world demand (2021 demand was just under 24,000 TWH) worth about £360 billion (assuming 20p per Kwh)

Landfill: The cost per tonne in the UK is £98. So assuming the UK government price this to reflect the externality cost, then that's a further £196bn saved, and further assuming that the up to 2 tonnes biochar is a useful commodity worth £75/tonne that's a further up to £150bn generated.
(https://www.parliament.uk/globalassets/documents/post/postpn358-biochar.pdf)

All in all, while my musing is a bit academic and no of course the above won't happen, and the answer is no Eqtec can't power the world, nevertheless I think I've just illustrated how valuable the Eqtec technology actually is. 20p Kwh assumes just electricity whereas liquid fuels of syngas and hydrogen offer enhanced economics. Today's market cap of less than £50m is insane:
Price/Sales 2022: >2, 2023: 1.1, 2024: 0.8, 2025: 0.4
Price/PBT 2022: 100, 2023: 9, 2024: 5, 2025: 2
(Using Longspear's forecast numbers 2022 to 2025)
Today's market is capitulation and despondency - when was the last positive thing you read anywhere? What happens after capitulation? Exactly.

GLA and keep your chins up

Hi Troy,

You were right when you anticipated today's news about Shale drilling. I think it reflects the extreme despondency in the market that there's virtually no reaction or trades in the market to today's news. It's actually a positive sign (the only way is up, as Yazz sang).

Finalisation of the pipeline H2 2023 is later that either of us would like and I had hoped Q4 2022 would be achievable. Nevertheless it is welcome progress. I looked up the pipeline map and there's a much bigger picture than just connecting to Kolkota. The pipeline network stretches right across India and is a national pipeline network.

GLA

You only need to go back a short way to see how the BOD are generating shareholder value. Qbot generated 6p/share last week on the upround for example. Did you miss that?! Generally there's been a severe derating of Biotech which has hit PDS for example. However this has now bottomed and the outlook from PDS phase 2 trials are strong. Biotech is fairly recession proof too!

You can moan about "brazenness" (sic) and "bloated salaries" but I'm pleased with how the BOD are leading the business and the commercial decisions they are making. Just sell up if you don't share that belief.

What I'm disappointed with is that this discounted offering was made to ii's - and private investors were excluded from the raise. I have written to the company to express my disappointment. Assuming you are a PI like me, I suggest you do the same.

Interesting move by IP Group to create an autonomous early stage fund. The idea being this incubator feeds later stage companies into the IP Group main engine once they've reached sufficient maturity. It's a good idea, and I can foresee a renewed emphasis on greentech in the coming months/year. IEA announced this morning we are off target; extreme weather events and food shortages will drive a renewed emphasis for example. On which cheerful note here's an article about Kiko!

https://tech.eu/2022/06/22/ftse-listed-ip-group-spins-out-kiko-ventures-a-new-450-million-climate-tech-fund

GLA

Having talked up the potential of the gas peakers to walk away seems deeply disappointing - and to not monetise it in any way as a "spade ready" project too. They don't mention Tring Road Gas Peaker either - so is that still in play? Not clear.

Otherwise it's of course positive around battery storage and around the offtakes - although to be fair doesn't really reflect any progress does it?

Overall feeling quite disappointed.

My estimate of KZG is:

1. HMS:
a/ Predicted to generate a GP of $300K per month of Zirconium and $225k Coastal Diamonds (@$750/carat)
b/ Walviskop 3.1MT of 62% minerals
c/ Neighbouring Beach 5x the potential i.e. 15.5MT
d/ Building a separation plant would mean 6x Revenue i.e. $1.8m/month gross profit.

2. Inland Diamond Mining
a/ 1000 carats a month @ $250/Carat should generate at least $1m GP/month

3. Tantalum Mining
a/ 3 Tonnes a month (volume is just a guess) at $160/Kg generates around $0.2m GP

4. Bringing it together:
Overheads 2021 were $1m. New appointments and new costs assume this doubles in 2022 ($2m). I've factored in costs of production to each of the above 3 areas.
Gross Profit should be $0.525m + $0.2m + $1m = $1.725m/month
Assume Jan - June we only achieve what revenue we know ($0.24m) plus 6 months ($10.35m) = $10.6m less the admin $2m = $8.6m PBT

This provides a decent run rate to pay for the scoping study and DFS at Great Lakes Graphite which I'd speculate is going to be around $4m. There are small creditors (circa $0.7m) plus notes to the accounts that reveal e.g. Directors deferred fees and a loan from Riverfort stacks up another $0.8m. There's negligible depreciation (maybe $0.2m?). There's bags of warrants too, so there is some dilution.

The good news is even if I'm 3x or 4x too optimistic in my assumptions and let's say it's not $8.6m PBT but just $2m... that will still be adequate to fund the 24-30 months Great Lakes Graphite and to clear creditors and plough back into operations.... And could you reasonably assume if it's $2m PBT in 2022 it grows from there towards $8m+ in 2023+ (e.g. 2nd beach and the separation plant)

I've used the data from the various Align analyses, plus data from the 2021 accounts to try to piece together whether this has legs. What I'd say it comes down to is whether you believe Dennis. What I mean is he would need to be a total idiot to commit to Great Lakes Graphite if the 3 sources of income weren't pretty certain. The lack of comms and updates *IS* disappointing - would've been nice to have had more of a heads up on progress before today. But listening to the interview with Dennis he sounds like.... a man with a plan.

I've topped up today at 0.95p which I think will prove to be a smart move and I can see how KZG could be valued at £15m-£20m based on a PE of 10-13 based on a $2m forecast profit. Which translates to a share price of 2.2p or 70%-120% upside from here - based on what I think are some conservative assumptions.

GLA

The "dawn" is technical validation firstly with Siemens Gamesa (in 2021) and Hyosung (in April 2022). The intense validation and now endorsement by these 2 large players I take as being what will translate over the next 2-3 years into commercial success.

Hi Zebbo, I'm pretty sure Bill said in the last investors call that they'd cashed in the swaptions (at 3X) but then taken out new ones with longer expiry dates.

Bill always talks his book up so recently when he said he expected 0.75% base hike or even 1% (and got 0.75%) strongly suggests that PSH has some swaptions out there benefitting from that hike. :)

Meanwhile we are now on a 35% discount to NAV - i.e. the discount has widened by 5% despite the hidden value of:
1. the swaption
2. the liquidation of PSTH and Netflix which provides liquidity in a market awash with opportunities (we can safely assume PSH are doing something interesting with these funds)
3. Fannie Mae and Freddy Mac are beneficiaries of rate rises.
4. The portfolio are all resilient quality stocks - happy to be holding some key US names that generate lots of cash.
5. Favourable $/£ translation for UK holders

GLA

Wassssss-sup? My fellow supremes!

Been reading about the acquisition and how this is a smart move for supreme.

So here we go. A chart that summarises perfectly why buying a closed system provider is smart:

https://www.bbc.co.uk/news/business-44295336

60% of the market is closed and growing.

Another clever move by our BoD