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3/3
Vanchem kiln fail after refurb - not sure what this means .. re-lining every year is needed. Was a bit overdue in June this year and had to take the calculated risk of pushing it out a bit. Just run out of its use and now needs re-lining (limping along he said), but bringing works forward, but 2nd wk of Jan going to shut down for 10 days to bring works forward from the plan of Q2
Plans for dual-listing .. not even on the radar ... not got the level of credibility yet .. not out of the woods yet
Tanya - she didn't leave .. I suspended her . Failure to disclose ... lives in London and cannot get to SA so there is a process for a disciplinary in Jan (so she might be back !!! - lets hope not !!)
Cellcude and Lemur funds go to debt reduction .. More than enough cash to pay for Orion in 2024 & 2025 .. so no burning need .... looking for value back
... WOW ... the package means 24 months Capex & Debt funding .. a really really big deal !
When does vanadium pricing have to increase .. model . mid point Oct & Nov (so probably around $32 I guess) .. Even at that price has noticeable positive EBITDA ... so long as pricing does not really drop too much further is OK... not enough to fund all Operations next year but can make payments in 2024, 2025 and some in 2026 .. anything north of $35 will be absolutely fine
Cellcude and Lemur funds go to debt reduction .. More than enought cash to pay for Orion in 2024 & 2025 .. so no burning need ....
... WOW ... the package means 24 months
When does vanadium pricing have to increase .. model . mid point Oct & Nov (so probably around $32 I guess) .. Even at that price has noticeable positive EBITDA ... so long as pricing does not really drop too much further is OK... not enough to fund all capital next year but can make payments in 2024, 2025 and some in 2026 .. anything north of $35 will be absolutely fine
2/3
One of the significant investment choices (discussed in earlier IM's) was the need to build a new Barren Dam. How long (assuming all packages are approved) will this take and when could the bottleneck of it be visible in increased throughput ? - phased approach over 2 years .. unconstrained output in 2025 after phase 1
Do you have a figure and timeframe in mind for the sales of Cellcube and Lemur given the long term high level of sunk cost ? - would like to dispose of cellcube asap but looking for max value ....
Is any relationship with MUST now over ? - 15% of MUST ... will not sign a revised share agreement.. 'I think that says it all'
The proposed dilution (in Dec) is without knowing if the Orion Deal is final and done ... why should we vote for it without knowing the final picture ? - No expected changes from 29 Nov .... conditional on BEE aand Bank approval .. basically, gotta vote dec to allow completion process
Benefits of group structure simplificantion - a bit tricky to unwind but efficiency is key. Moving from a centralisied model to a decentrelised allowed more local accountability, reward and faster decision making .. reduce the decision making inertia. Does not yet know the size of the savings possible in operations - that is sometime in 2024 to review and simplify - got 10x suppliers than should have and half are not on contract ..
(has spoken before about outsourcing 'Projects Management' giving a 50%+ saving)
What is happening to BE ? ... a bit vague but we are going to cut the umbilicle ... so aside from Electrolyte BE is gone ! Energy will not be part of the business going forward .... That is a big statement (bye bye MN ..)
Mini-Grid - could run 'tomorrow' at full capacity - waiting for a (legal) compliance cert from Eskom - just a process ... its ready to roack 'n roll
Belco - (update earlier). Just waiting now. If nothing is forthcoming by the end of Q1 will have to start looking at options (to dispose). Not going to fund Working Capital forever .. again .. real focus !
Appropriate level of Gearing following the re-structure .. 'a lot lower than now' .. really want less than 50% as it is cylclic ... can live with 80% at the top of the cycle but not the bottom (where we are now)
(Looking at the next 2+ years of debt repayments covered by the deal, would bring the gearing down to below 50% .. the bigger operational picture looks rather clearer now)
What does BMN look like in 5 years time ... currently at around $30/kg, should be closer to $40. For every 10% in price $20m EBITDA .. so at $40 will be making $50M+ ebitda .... 'would like to see volumes significantly higher'. Irrisponsible to speculate on numbers but Kiln-1 but in its heyday was doing 100-150mtv/ pcm ... 'I see a Bushveld focusing on mining, but has significantly higher revenue, significantly more capacity'. The challenge is to make the base in 23/24 is much leaner and efficiencies in place as the 'new norm'.... doing excepti
As requested @HS ... 1/2
$18.5M Raised
SPR - $12.5m, + Acadia & Orange Trust
$4.7m for orion re-structured at 3p (around 123-124m shares)
$42m proceeds
$1.5m further right by end feb amounts to 39m shares
4,300-4,500mtv at production cash cost $26.0-$27.0 cost per kg
Clearly more cost/personnel savings will start next year in operations
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Are you planning more fund raises or a share buyback - no new words.. buy backs not being considered at this point
Update on lemur - a non core asset and looking at exciting
Electrolyte - 9 international customers qualified .... no update yet, but of the 9 batches, 3 have so far approved as preferred supplier and 2 wanted additional vols (5k litres) .... very positive
Vanadium price projections based on VRFB ... just using industry data
Lowest All-Sustaining cost that can be achieved .. expect costs to decrease over time
Working with FM ? - didnt work closely for very long. No longer working with him now Cellcube going .. no payments
Sustaining capex 24m now .. v 7 lst .. is this a failure of previous management ? (Slide 4 is a 2 yr window, so 12m pa) ... this says all sustaining capex for 2 years will be there and not dependent on sales. Looking at projected capex over 5 years and the initial bow wave is through, the steady state is aroun $8m ... so higher than historic, but far more realistic .. very necessary to play catch-up
Why expecting cash costs to remain flat when production costs change ... still struggling with some assumptions but there is 9-10% inflation and additional maintenance costs. (Vametco is 30% more than 2023, in real terms 20% more) but very necessary to get the bow wave done so not forever, but initial
2025 production estimate - expect production to be 'significantly' higher than 2024 ... the Barren dam is a large bottleneck .. looking to have unconstrained production in 2025 ... no figures,
(so what does 'significant mean .. 20%, 25%, 30% ??)
On the Investor Meet (29th Sept) Craig said "would love to buy shares ASAP and is very frustrated he cannot due to inside info. He said he would use entire salary to buy if he could". This was widely seen as a strong vote of confidence, and whilst a purchase is a personal decision, does Craig have a comment on why his allowed purchase into the placing was so small and what message does that send given earlier comment ? - 60% of commitment made .. a bit vague .. said 60% of first 4 months salary mmhhh !!
When these various deals and placing are done, what assurances do investors have that this level of dilution is it and there will be no more placings in the next 12-18 months (at least) ? - not looking for anything for at least 24 months
$1.5m in savings (at 4,000 mtv) works out at around $2.6 cost saving per KG ... so 7-8% cost reduction ... that is real focus.
CC said in August that the company had to focus on its core and get smaller to get bigger .... I suspect he knew in his first week what needed to be done
Clearly FM ran a fat sloppy ship (please, no more FM was a great man of vision guff) and Watson & the non-execs need to go as they were clearly asleep at the wheel allowing it all
Maybe @PD101 had a whisper yesterday about this !!
As I said .. that is not.. what the company told me ...
Fun as though this is, you clearly have a problem reading .. I have not said your 'accounting stuff is wrong'.. I have said that is not what the company told me it did !
I don't give a stuff if you agree or not .... end of this
And no .. I did not misunderstand the wording .. and no .. I am not posting private correspondence with the company
I don't give a stuff if you think differently or not, but what has been clear is that stock (cash) pile was used to prop up the business until Orion funding .. presumably in the hope they would not notice.
The response and words of CC in his first couple of months rather pointed to finding a right horlicks and if Tanya had not helpfully compromised herself I doubt she would have been around much longer
He Trev .. 'woukd have been' is your guess
The company confirmed to me what they actually did... Costs were applied in last year's loss making accounts
Ergo.. most of the sale price would be pre tax bottom line
But you carry on making it up