Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
I think there will need to be an update tomorrow or after hours today. Let's hope someone is signing the OD agreement right now.....
In fairness this is what it says in the Placing, Subscription and Open Offer dated 6 May.
“The net cash balance at 5 May 2022 was £1.4 million and whilst an overdraft facility of £2.0 million remains in place and unutilised, the facility is subject to renewal in June 2022. At this time, there is no certainty that the overdraft will be renewed or that it will be renewed at the same level”.
There should really be an RNS to clarify the position by now whether the OD is needed or not.
It seems to me that there are two big “delivery” issues at the moment. As we know container costs are about five times what they were a year ago – no one expects that to improve for months yet, but by and large costs seem to be getting passed on. Then there is port congestion in the US with ships stacked up so getting goods out is still a problem. CNY approaches and that should help with this. But we also have inflation getting worse in the US – that could impact on sales and be a more serious issue longer term. What we need is some serious Director buys. I don’t think we are in a close period so the TU clears the path ….maybe.
By my reckoning from the October update t/o is £10m less than expected and EBITDA c £9m less than expected in the Autumn. Which suggests the extra costs are c £6m more. Not surprising given fuel and shipping costs. Not much management can do in the short term other than ride it out and push the costs on as far as quickly as possible. Tricky to pass on costs in the short term that were not expected. But if they can get back on track by my rough jottings the various updates imply EBITDA (and positive cash flow) of £20m plus next year.
What is more interesting is the “strategic review”. That can cover all sorts of things. Does the RNS imply more detail next week? In my experience these things take months….unless there is some unknown pressure than means the unscheduled update was required. So yes, why, is a good question. But maybe next week will just be more detail on trading. Must remember to get up early next Tuesday.
Maybe we will see some research next week that will give a few more clues.
Looking at the AGM resolutions maximum new SC is £32,750 – 1,637M shares. Do I have that right – happy to be corrected? If so and the issue is at a 15% discount to today (.31p issue price) the max cash raise is £5.2M. Less issue cost (must be at least 5%?) leaves c £4.9M. After consideration of £4M, £900k max will be left for legal costs etc of deal and working capital to plug into Going Concern calculations to cover cash burn (if any) over next 12 months. If more is required, they do not have time before 30 June to get the authorities they will need.
This is my first post….and maybe the last!
The Investor Presentation is interesting. Key take homes for me:
• Now profitable – with a stable, predictable, and growing income stream so profit is forecast for 2021 year.
• Paul explained there is little or no NRE meaning a higher % of increased revenue falls direct to the bottom line.
• A significant account will be between £300k to £1m revenue – two significant accounts expected in 2021 – Paul (of course) hopes for more.
• Most interesting - eMusic live expected to contribute “significant millions to Company Revenues”.
• Further cash raises will only be for commercial opportunities.
• Worry might be the new marketing costs mentioned. But these can be controlled.
• I may have this wrong, but as I understood it a suggestion that there may be a research note early next year that might start to give some forward looking transparency.
Not sure that the Nomad would allow these statements unless they had seen some evidence? IMO.
Overall, a transforming year and a now different business compared to that a couple of years ago. And I think I picked up that certain Directors guaranteed borrowings. In my book that deserves respect and shareholders should be applauding.