Member Info for DiamondGeazer

I can't build a valuation model for Cheyeza East without a resource statement, and I know Remy once talked about having done a desktop model for it, but Remy was a commodities salesman, not a mining engineer and I doubt a reliable model was ever put together.

It's obviously worth something, but I think potential is now irrelevant because sentiment is so negative with Arc's BoD, that potential will not be valued until things actually happen. I don't think Botswana will be given a value in the SP until they actually have drill results, not news that they may drill - after all they were meant to present a drilling plan for Botswana last year. all the best.

My second concern is dilution.

The company currently has approximately 2.46 billion shares in issue. In addition:

• Around 1.01 billion warrants are exercisable at 0.8p

• further 229 million warrants are exercisable at 3p

• Up to 50 million shares may be issued under the LTIP at 2.5p

If all of these convert, the potential share count rises by roughly 1.29 billion shares, representing dilution of around 50% from current levels.

Yes, warrant exercises would bring cash into the company, but the dilution is punitive.

For me personally, this is the key issue.

To return to my original average purchase price of 4.1p, Arc would require a market capitalisation of approximately £150 million, depending on the number of shares ultimately in issue. Given the current capital structure and the level of potential dilution, I do not see the risk/reward as attractive for my own portfolio.

Others may disagree, and I genuinely hope long-term holders do well. However, after reviewing the numbers, I have decided that I will likely sell into any meaningful share price strength following the results. For anyone thinks I am hurting the SP by such negative thoughts, I have never thought this BB has any impact on the SP, but from conversations had with other shareholders, an increasing number of investors think the same about Arc.

As always, this is not investment advice. It is simply my interpretation of the published figures and the reason for my own investment decision. GLA. DYOR.

I bought into Arc Minerals in late 2020 at an average price of around 4.1p. Looking back, I now believe I should have paid far more attention to management incentives and capital allocation rather than focusing solely on the quality of the assets.

The first major red flag, in my view, was the surrender of management share options in March 2021.

The company has consistently referred to a Black-Scholes valuation using a 10-day VWAP of 6.94p. Recently, I rebuilt the calculation in Excel and realised that 6.94p was only one input into the model, not the option exercise price itself. The exercise price was approximately 7.96p per share. Had 6.94p been the exercise price, the value of the surrendered options would have been materially lower than the £3.47 million ultimately awarded. Shareholders can make of that what they will.

What concerns me more is the overall picture.

Based on the published annual accounts from end 2020 to end 2024 (the last available), my understanding is:

• Total raised from investors since the end of 2020: approximately £11.29 million

• Total received from Anglo American: just under £2 million

• Total salaries paid or awarded to Nick von Schirnding and Remy Welschinger (2021–2024): approximately £2.37 million

• Bonuses awarded: approximately £792,000

• Value of surrendered options attributed to them: approximately £2.075 million

Total remuneration and option-related awards to just these two senior executives therefore amount to approximately £5.24 million.

Over the same period, capitalised exploration expenditure was approximately £1.77 million.

Every investor can decide for themselves whether that represents an appropriate balance between management compensation and investment in the ground. GLA. DYOR.

Pleaase could someone post the link to this so-called video?

I have 4.45 million shares and you also have my support.

Assuming that each Anglo JV meeting was held every three months, Arc and Anglo must have just held the 8th JV meeting. Given that we have had absolutely no drilling activity this year, I do not believe that this meeting was the first time that NvS was alerted to the possibility that Anglo weren't interested in continuing - they will have had to have given an explanation as to why they weren't doing the drilling, information which was never shared with us. All we've had in statements from NvS over the last 12 months about how much he was looking forward to sharing the drilling plans. It seems very likely that the Board intentionally did not keep shareholders advised of what has been happening over the last few months.

Just to re-iterate the numbers.

Between 2021 and 2024, Nick von Shirndig and Rémy Welschinger arranged for £8.4 million to be paid out to directors and senior management via surrendered share options, salaries and bonuses.

Of this Nick von Shirndig and Rémy Welschinger's share for their part-time jobs was £6.2 million - versus only £1.78 million spent on exploration! If anyone wants to sue the Board, please count me in.

Apologies Guzzler,

I omitted to say that of the £8.5 million totals £6.2 million+ were for Nick von Shirndig and Rémy Welschinger. If their contribution to Arc isn't the definition of 'part-time', I'd like to know what is. Hope you feel you got value for your money.

Or put that another way. Since Jan 2021 (to end Dec 2024), through rights issues and warrants Arc has raised about £11.3 million. Anglo have so far paid an additional almost £2.4 million. Total = £13.6 million. Of which £8.5 million+ has gone on directors and senior management in the UK.

Nick von Shirndig and Rémy Welschinger's share of that? £6.2 million.

And what have we spent on looking for copper over that same period? Capitalised exploration totals just £1.78 million. The figures are the wrong way round. This is a two man gravy train. Two snouts in the trough.

Guzzler,

Arc’s market cap has risen to just over £18m, yet still no RNS or update from the Board. No drilling or explanation has been provided about the Anglo JV, and in Botswana and Chingola nothing operational has happened, probably due to cash constraints, even with the Anglo payment. Without the Avanti payment and the sale off Botswana, (which has apparently been selectively briefed to certain shareholders) we are up against the wall.

So here's a thought. Between 2021–2024, directors and senior management have taken £8.5m in pay, bonuses, and surrendered options - despite these being largely part-time roles. Earlier this year, they awarded themselves options on another 5%+ of the company.

Selective briefing, poor transparency, and a complete mismatch between the rewards for the Board and rewards for shareholders. If Arc succeeds, it will be in spite of this board—not because of it.

I bought into Bluejay at a price that you couldn't even see with a telescope, and had given up, but reading some of the commentary, maybe things are looking interesting again. I have just bought some more shares (at an over 99% discount to my first purchases!). are you able to give any more detail on exactly when the GLND IPO is meant to take place? Is it pretty much certain that it will happen this year? Many thanks.

Travelcard,

They say 'cut' in the press release, but with this lot, who knows what they really intend? Its slightly odd because whether or not Anglo were drilling, there wouldn't be any extra money coming in beyond Avanti and Anglo, unless the warrants are triggered, so one minute they pay themselves what most of us think are unjustified salaries, and award themselves huge bonuses for the JV deal. Yet they know there is no extra money coming in and then they 'cut' their salaries and even then we haven't even got enough to fund Botswana or Chingola. I don't think they plan at all.

I would appreciate help on understanding one line of the accounts.

In the accounts for H1 2025 just released, Arc lists under Trade and Other Receivables:-

Receivable – Anglo JV (USD 1M). £730,000.

Since we are only entitled to 66% of the USD1 million, how are Arc allowed to report this number which as far as I can see is a case of overstating assets?

Also HarChris if we at last get some (big) drilling news we need to SP to get to 3p, then the warrants get exercised and cash comes in. But in the meantime what are you assuming about Botswana and Chingola if for the rest of the year we don't have enough cash to do anything with these?

I see that someone also took down Piscator1's post about a court case re Mushy happening tomorrow? If true that's certainly news to me. Anyway the SP rise, might suggest that something has leaked.

Thanks HarChris, if I understood you correctly, please note that the final large payment happens at the end of phase 1 which is 180m days after November 2026, i.e. May 2027.

If there is a lesson in all of this, I think (completely with the benefit of hindsight of course), that when a small company signs a contract with the likes of Anglo, you need to try and get annual spending commitments, not a commitment over 3 and half years! If we don't get news soon, I won't envy the person trying to think what highlights to include in the press release for the Arc interims in Sept. A blank sheet of paper would probably tell the most accurate story!

Harchris, I have to admit that I had thought the Casa sale was such a write off that I had forgotten we were owed any money at all, and certainly didn't expect to get any, so this is at least a bit of good news! I am pleased management fees have been cut, and I assume that means 'cut', not 'deferred'?

Between this and the Anglo Nov payment that's about £900,000 coming in, but it will be needed because I suspect that with the negative sentiment about the company's BoD, the lack of delivery and the SP, that shareholders would have refused to fund another capital raise at these levels and I imagine the likes of Shard told them that.

I, like everyone I would guess, remain concerned that we still have no news about drilling in Zambia, and the BoD still won't say anything. The fact that management now says it has been cutting back expenditure for some time leads me to suspect that they have known for a long time that there would be no drilling, at least until now. I am guessing that the quarterly JV meeting is happening at this very moment, so I remain hopeful that good news, even if its just in the form of a drilling plan could be arriving soonest, but no news on Zambia in the next few of weeks is really pretty catastrophic for us. If we are as strapped for cash as I suspect we are (we'll find out the cash figure for end June in late Sept), you have to wonder what that means for Botswana and Chingola, and if we can't afford to do anything with them, why do we have them, let alone why did we this year buy into Chingola?

My only agenda CuriousCat9 is to try to stop the BoD spending so much money on themselves for doing nothing by calling them out, and for Anglo to do what they are meant to do - drill, so the SP can retrieve some of its (my) losses. I have to confess I was slightly worried by your earlier comment about whether Anglo has put the drilling on hold until the court issue is resolved end Q3 as per the Jan RNS, but if that is so, we surely would have been told that?

AiM rules require that companies report their interim results within three months of the period end, but they allow a company to report its annual results up to six months after the year end.

The result of this was that we only found out last June (2024) with the publication of the 2023 Annual report, that on December 31st 2023, one month after receiving £1.87 million from Anglo for the JV deal, the company had a mere £281,000 in cash. Had we known that, it would have been blindingly obvious that we were going to be hit with a rights issue to pay our greedy BoD's pay-packets. If you remember, the Rights Issue in Feb 2024 was framed around helping the Swedish institution Sveriges Lärare exit their position (how sensible were they!), and anything left over would be used for general corporate purposes. Yeah right - they raised £4.04 million (net of expenses), but only 10% of it was used to buy out the Swedes, and only 4 months later, by 30th June 2024, there was only £2.4 million left. I suppose the management had to find the funds somewhere to fund the £1.33 million bonuses management awarded themselves for 2023 (on top of their £907,000 packages)!

By the end of December 2024, we now know (with the publication of the 2024 AR) that even after we received an additional (approx) £530,000 (our share of the USD1 million last November), the cash position had fallen to £1.635 million on December 31st 2024, so the BoD had gone through another £1.3 million in just six months, for a handful of drill holes in Botswana.

So where are we today? At their current rate of spend, only a tiny percentage of which is on actual exploration, it seems almost certain that we are going to hit by another highly dilutive Rights Issue in the next couple of months, if not weeks, (most likely before we find out how dire our June 30th cash position already is in the interim results to be released before end September). Some of you have suggested they are selling the Botswana licences, and maybe that would stave off another capital raise for a few more months, but if that is the case, I'm not sure why some people seem to know about this but most don't.

Which probably explains Chingola. Just as they used the Swedish selling out of Arc as the reason for the Rights Issue last February to fund their expenses, it seems highly likely the BoD will use new exploration at either Chingola or Botswana as the reason for the next Rights Issue, with the remaining proceeds to be used for "general Corporate Purposes", but in reality its to fund their lifestyles.

So likely timeline? Anglo eventually announce some form of drilling programme after the JV meeting this month, as soon as the SP moves up, Rights Issue announced. I'd rather be wrong, but if you think this is a rather cynical view, this BoD has rather a lot of 'form'.

Travelcard, I haven't filtered him. you aren't missing anything important.

Re your comment about the JV, I think its important to note that whatever legal clauses stop Arc from sharing info about the JV with its shareholders, Arc have a very clear legal duty to keep shareholder informed about material information that could impact the SP. We all know that from the JV meetings they will know exactly what is happening, even if it's nothing that is happening, whether they can share it or not. Having been party to these JV meetings, they granted themselves 5% of the company.

What do we know about Botswana? Nothing. What do we know about the new purchase? Nothing. What do we know about drilling plans in Zambia. Exactly nothing. What do we know about the JV meetings. Nothing.

So I hope for their sake, it is simply a case that they are in the dark about Anglo's intentions, because I for one have had enough sh*t from this BoD that if it transpires that the reason no drilling has happened, is because of an issue with a licence , or a court case that they haven't told us about, I am now most definitely going to go for them through their Nomad (and I have no issue with reporting their Nomad to the FCA). I hope for the BoD's sake they are not sitting on information.

Assuming that the quarterly JV meeting is this month, does anyone know the exact date?

I think its reasonable to conclude that we definitely aren't going to hear anything about a drill plan before the JV meeting, but hopefully there is a chance (although I'm not holding my breath) that we might have news after this meeting, even if the actual drilling itself doesn't start for a couple more months.

Anyone else got any thoughts on this?

Thanks for the reply. I posted before I saw it. I don't disagree but for two comments. 1. the BoD have four JV meetings a year and Vass sits on the technical committee. If we have not been told anything at these meetings (which I find very odd), then the BoD should stop saying how excited they are about keeping us informed about drilling plans that don't yet exist and say they havent yet been given a date and will publish them when they receive them. It may not be what we want but at least a BoD who keeps us informed means we know we will always get the truth, and the market usually always values honesty. Underpromise and overdeliver. this company is the opposite. 2. The reason that this share has become a 1p stock is not just because Anglo aren't drilling yet, but because the BoD have turned this into a lifestyle company for themselves; The way they dealt with the Swedish company selling, their salaries for what is one day a week of work, but above all, the knowledge for every shareholder that if something goes wrong, we won't hear about it, is why this SP has been destroyed.

The question that also needs asking is how many drill rigs have been hired. Normally these have to be booked up months in advance of the end of the wet season, and it would be unusual if they have been sitting idle just waiting for Anglo to make a decision over when to bother to start drilling. we are all being intentionally left in the dark by the BoD until they can find some good news. No wonder the stock trades so low.

You will also have noted that our cash position in the last six months of 2024 fell from £2,413,000 to £1,635,000. Once you add in the USD666,000 we got from Anglo in November, our BoD went through about £1.3 million in just six months. Doing what? Looking after the BoD and Drilling a couple of holes in Botswana. That rate of cash burn shows how appallingly our company is run.

I thought I'd copy and paste NvS's sentence from the Annual report for last year. "We remain committed to maintaining open and transparent communication, keeping you informed every step of the way". What a liar.