Member Info for aprogerson

@tom Extra £2m+ CASA transaction cash to ARCM on top of NvS stated 2 years plus cash position can only be a good thing
ATB APR

Looks like POG is under pressure now @1724p which is 38.2% retracement from 2072p high ... should be really strong support here. Let's hope that holds or next stop 1680p

POG getting hammered again not do much for by gold stocks :-(

@rich As they say the US$ is the least worst fiat currency and over 50% of the worlds transactions are denominated in US$ so you need them to buy and sell stuff. Also as bond yields rise investors are moving into cash to increase their 'optionality' in case stocks crash driving up demand for dollars.
Meanwhile real interest rates rise and commodities priced in dollars weaken ... diabolically and truly Bonkers as the fiat currency printing presses continue in overdrive !
GLA APR

@roley I did wonder why they quoted A$ as part of fund raising but then said they were a UK company. Nothing listed on ASX upcoming IPO list so we'll just have to wait and see. Personally I prefer ASX listing as the IPO Prospectus disclosures are far more thorough.

@wareing Interesting I can't find anything either. Low6 website is just about its products and no investor info as Low6 is private so does not have to publish anything.

Low6 has had 2x pre-IPO funding rounds on 14-Dec-20 (£1.5m raised) and 26-Feb-21 (£3.3m raised) for which GUN has subscribed for £265k shares via a CLN. I understand Low6 is planning to IPO in Q2 2021.

I also know Pires has subscribed for £225k in CLNs over the 2x funding rounds. PIres also stated that "Since its founding in 2017, Low6 has raised over £8 million to date and plans to raise more funds through a pre-IPO funding round with a view to completing an IPO in H1 2021." So with the additional £3.3m just raised it brings pre-IPO funding to to over £11m doubtless used to fund building its app and rolling out its business model.

I would expect that at IPO Low6 would also do another fund raise as it would need to offer additional shares for new shareholder to be able to participate. It will be interesting to see how it structure this, at what price and what uplift it gives to pre-IPO shareholders to reward them for taking the risk as an early investor.
ATB APR

@akhtar, no idea which is why I think it will be within the next 3 months as they've had 7 months already from last July.
Anything more is frankly getting ridiculous and becoming an opportunity cost for ARCM as we could be talking to another suitor.
APR

@Tom I like to think of it as dating game ... ARCM is the young desirable professional straight out of college with everything to look forward so a solid 7/10 that has been dating a very eligible 10/10 supermodel for the last 8 months and clearly hoping to 'close the deal' .... (almost) everyone would be happy with a 'deal' but you just never know for sure. and you don't want to seem too desperate and you have to prepare yourself for a no deal.

@SeisNav I think you are right, it is the downside risk of AAL walking away that keeps the SP in check as NvS has covered off (almost) everything else. If the AAL deal shape, scope and value were known then we would not be having these discussions and the MCap would be comfortably £120m+.

IMHO my Transaction risk analysis between ARCM & AAL can be summarised as:
> Proximity = Announcement likely in next 0 to 3 months

> Probability =Upto 5% chance that AAL might walkaway or 20% chance they offer an initial deal that NvS will not find acceptable (cue start of haggling!) as AAL want to drive a hard bargain !

> Impact = If 'No Deal' then SP will be hard hit & may retrace upto 50%

> Mitigations ... NvS has been VERY busy with these to minimise chance/impact of above to ARCM !
1) Sticky Money = bring on HH to boost shareholder list, reduce free float so boost SP
2) Revenue = Upgrade Kalaba plant capacity & confirm routemap to 'production ready'
3) Cash = Placing completed and confirmed fully funded for 2 years
4) Licences = controlling 70% interest confirmed
5) BoD = boost membership including financing & country specialists
6) PR = advertise we require any offer to provide decent shareholder value (minimum 10x stated repeatedly by NvS)
7) Debt Facility = Kalaba plant debt funding being explored to avoid dilution
8) Scoping Study = layout independent analysis of production capability, revenue and cash generation (FCF) capability

Obviously AIMHO & DYOR APR

@F29 I usually do stick with facts, read pretty thoroughly and try to be as balanced as I can with my commentary and have been invested in ARC and its predecessors since Sturec days with over 30% of my PF here. I know we did not 'build' the original Kalaba plant, but certainly built it out to extend its capacity so your point is mainly semantics in my view.

I thought I explained my thinking on the 18-24 months as related not to production start itself as an 'event' but when the full FCF stated by the Scoping Study would come onstream as I mentioned tweaking flowsheets ... I may be wrong and they do it quicker but that is my more cautious view and is my interpretation given what I think I know. In my view having 2 years cash vs. my 18-24m cautious view of ramping upto full FCF is a good thing and to be celebrated as it protects us against downside shocks if something does not go as planned.

Happy to be called out if anyone disagrees with any of my analysis and I try to give credit where that is due and repost when I think more information is available or I've got it wrong. If you think I don't understand or don't/can't read then you are most welcome to your view and I will courteously beg to differ.
ATB APR

@bushytailed The other big driver of inflation will be Joe Public coming out of lockdowns having saved lots of money and wanting to buy and do stuff. Overlay that with massive disruptions to supply chains and businesses with minimal stocks due to shutdowns and/or just conserving cash and that will also drive CPI inflation not the asset inflation we have been seeing for years in tech stocks and houses driven by central bank money printing.

One of the most interesting dynamics will be when inflation comes back the large tech stocks with their Jam Tomorrow business models and Jam sometime next century valuations will correct as the price of money starts to rise.

All that money will be looking for somewhere to go. Real asset prices will rise and a fully fledged commodity super-cycle will really kick off.
ATB APR

@max19 Yes agreed I think it will realistically be 12-18m before any 'real' production got underway as flow sheet would doubtless need tweaking et al so target FCF would be 18-24m which to be honest would be a good result. The point I was really trying to make is that NvS has the 'gap' covered by cash for 24m exploration so ARCM would not need to stop anything or compromise what it is doing or what options it may wish to entertain.

Meanwhile roll on the main event ... a transaction
ATB APR

@rustydog sinai lad process ???

@max19 If we were 'just' an explorer then why did NvS build the Kalaba plant, commission a scoping study and then want to expand it so that ARCM had the ability to produce more copper concentrate?

I think the answer is NvS views ARCM as PRIMARILY an explorer BUT realises that to fund exploration we need a secure, regular revenue stream that is 100% owned rather than going back to shareholders for funds and avoiding associated dilution which no one likes or wants.

Oh and having our own revenue means we also are financially strong so if we need to raise debt it is cheaper and if we enter into any deals we have a much stronger negotiating position ... sound familiar?

Simples ... all options now available, controlling 70% interest in licences, exclusive discussions with major (AAL) well advanced & technical study & DD completed, institutional investors and family offices onboard, directors heavily invested, extensive soil sampling completed, 3km drilling completed and ARCM position reserved, others majors interested and approached ARCM; did I mention we ALSO have lots of cash in the bank to fund our exploration for 2 years if any of the above goes to hell in a handcart?

Looks like all systems now primed and ready to go! Are we there yet ?
ATB APR

@peggy You know we all love you really ...
> Rising copper price = as per my prior Scoping Study and ARCM Valuation posts already +50% FCF on Kalaba initial scoping study due to $9k/t copper vs $6.5k modelled = HUGE difference !
> ARCM tweets = (1) get the SP up by promoting ARCM & (2) get more II interest to support SP ... reason why is that any JV 'share' would be based on AAL 'investment spend' made vs. valuation of assets & MCap plays a part
> Asset value = Without revenue ARCM assets will be based on resources declared (non-JORC) or comparables for which we have Sentinel that matches geography, country, geology, minerals & at least matches grade

Ref 1: Scoping Study calculation of £22.8m/annum FCF @$8k copper @14-Feb-2021 "Scoping Study & Goldilocks Scenario"

Ref 2: my 14-Jan-2021 full post @Comparable valuation: US$260m/£205m (FQM buys Kiwara/Sentinel 2009) x 30% better ARCM grades (lower costs) at 55% better Copper price (more profit/ton) = £410m. https://www.reuters.com/article/us-kiwara-first-quantum/first-quantum-buys-kiwara-for-260-million-idINTRE5AM3Y220091123

If Sentinel is a good comparison (it is and is only 40km from ARCM licence area) then a ARCM Tier 1 asset should be worth $550m / £410m at todays copper price so I would expect a figure in excess of $600m / £430m (or £300m to ARCM) to close a deal on ONE Asset.

If AAL transaction falls through because they don't want to pay enough I am 100% sure that there will be other players that will want to do a decent deal. ARCM have lots of options and at least 2x big assets they can flog or JV and still retain tehir own production facility to generate FCF to fund further exploration.
I'm sure we are all wrong and you are right.
ATB APR

@San 100% agree and your price targets concur with mine. If you have a bit of patience and lack the constitution to trade (so some do) then a 2x to 3x MCap increase over 6-9 months as exploration programme unfolds is a damn fine outcome.

Confident & very happy to sit and wait wait 20% of my PF invested here. At £7m MCap there is potentially a lot of upside to be had with a possible positive copper surprise back on the agenda.
ATB APR

@marco sorry link does not work for those without telegram like me

Hopefully I don't get trolled

@CHRI55 I had my buy-back-in price set at 19.5p just above Mar-20 low of 19.3p when POG was around $1,470 or $300 less than today. However we also know HUMs forecast AISC has gone from $950 to $1,250/1,350 as rise of $300/400 more than cancelling out the current positive POG differential since Mar-2020 lows. As per RNS 4-Feb-2021, " 2021 production guidance of 100,000 - 110,000oz of gold, with AISC of US$1,250 - 1,350/oz on gold sold"

We also know that the macro environment is currently rising bond yields so interest rates are currently rising & not good for POG hence current weakness. However we also know that central banks won't allow this so yields will be repressed decreasing real interest rates which is good for POG. So IMHO likely more POG weakness before it goes ballistic as higher inflation expectations take off !

Like it or not this implies that a retest of 19.3p low is a possibility unless POG firms up, HUM look to cut costs or if it wishes to continue its investment in exploration et al to increase production and/or grades. My chart shows major support at 19.3p and below that at 12.5p which seems absurd to be even mentioning given the very strong growth outlook over the next 18-24 months for HUM unless exploration investment is cut which I cannot imagine they will want to do unless their hand is forced if POG drops significantly.
ATB APR

PIRIS also invested but not as much as GUN.
Low6 IPO still targeted for Q2 2021