Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
It’s not the H1 update I was expecting and hoping for granted, but it can be seen that the company is repositioning itself to facilitate the rapid growth that is coming. Jam tomorrow maybe, but I do believe it’s coming and in large quantities. Getting the equity subscription closed is obviously the reason for the delay announcing and at just 5% discount and to a supportive long term and major shareholder is actually pretty good. They clearly have confidence in the company.
I think we have two things to ‘thank’ for the ridiculous SP:
1) general market conditions, especially in AIM where lots of good companies are way down as investors have pulled money out for cash or safe havens; and
2) Goldman Sachs with their discredited scaremongering re lithium prices.
Ant. In my opinion only (not advice obviously): A) any sale of Geomet shares otherwise than in accordance with a Funding Plan (part of the Construction decision, itself a reserved matter requiring a unanimous decision of both Geomet shareholders) would require a unanimous decision of both shareholders (see reserved matter viii);and B)sale of EMH’s shares in Geomet would, I believe, require approval of EMH shareholders in a general meeting. Approval of the construction decision is the only reserved matter subject to a deadlock provision whereby if EMH and CEZ (via its subsidiary) can’t agree on that CEZ has the option of acquiring EMH’s Geomet shares but, crucially, at fair market value, which by that stage would be informed by the dfs and offtakes. Hope that helps but DYOR and all that jazz.
Anyone with the slightest worry that we are vulnerable, as the minority shareholder in Geomet, to being “screwed” by CEZ, should refer back to the AGM papers RNS of 5th December 2019 where the terms of the shareholder’s agreement are set out, including a comprehensive list of ‘reserved matters’ which require a unanimous decision between EMH and CEZ and also deadlock provisions. No likelihood of us being screwed in my opinion but take a look for yourselves.
Hunky
Not sure who challenged the fact that the $16m contract is additional to the framework agreement with the consortium, but it wasn’t me, and my post was at pains to confirm that. I think we are furiously agreeing mostly and to the extent we differ at all, that is explained in my post. Best.
Hunky
With respect, I think you may have things a little muddled in your post. There is no order of $40m ‘only’ a framework agreement which could deliver in excess of $40m by end of 2024, if the numbers indicated by the consortium are in fact ordered. The first (and only) reported under under that agreement was the 500 units rns’d on 15th June. It is clear, in my opinion, that the contract reported on 13th July is an entirely separate and additional contract with another distributor (not the consortium) this time with a firmer value of $16m over 4 years. So, I don’t think we can deduce a specific number of further orders under the consortium’s framework, but we have been given an estimated value over time. What I think we can deduce, given the exclusivity conditions referred to in the 17th Dec rns, is that the consortium deal probably didn’t cover Argentina. The latest does. The other interesting point is that there was some disappointment that it took 6months to get an order for 500 units under the framework contract with the consortium and I notice that in the 13th July rns, that they are more careful to manage expectations by making it clear that revenues won’t start to flow until early 2023 and will ramp up more strongly in 2024. In other words, this deals take some time to ramp up, and we should not be concerned about the apparently slow start to orders under the 17th Dec rns. Totally agree with your comment about our market cap, except I think it’s looking silly already!
We have an Investor Meet Company presentation on 20th July at 12.00 BST. I reckon we will get a general trading update before then.
They are going for scale with free kits freely available to new users as you know, so £1m in sales in 6ths seems pretty good to me. I think a fair chunk will be ‘commission’ on product sales which as you say is basically pure profit. From a standing start not at all poor imo.
Not sure, but I would imagine it’s a combination of the two.
Wouldn’t be surprIsed to see a general trading update prior to the investor meet company event on the 20th. Dribbling out a few titbits beforehand to warm up the market is a good strategy imo.
Correction - 10.42p
Great RNS and a decent top up for me at 10.45p