Yeah although it's all been complicated by the lack of cash in the business and the precariousness it leaves it in with bills to pay and debt maturity looming - talk might come from a genuine place but how do you attract a reputable CFO to a business that can't pay you and can only offer shares for the time being, shares that be heavily diluted in time? Do independent NEDs want to come in and be stuck in the middle of a battle to gain control of the company between an incumbent and a rival party?
It's why I've sold out for now. On the one hand there are lots of reasons to be sceptical of this newly formed group and I thought the written responses by TGR management yesterday were actually quite solid and convincing but on the other the performance from the company has been so staggeringly poor this past year that it's highly unlikely that there's going to be any chance of a meaningful turnaround with the status quo - after all access to capital is essential now and it seems so unlikely that a TGR run by Shishir, Puruvi and Alastair is going to convince lenders to part with their cash now without significant on the ground improvement being seen first (and that needs cash, so a catch 22).
This really is an impasse at this point.
I've not seen him making many right calls of late however with over 20k followers dedicated to investing and trading it's a positive to have him getting excited over ARCM and has made it only one of his two long term investments:
https://twitter.com/MylesMcNulty/status/1790273048924332068
Not necessarily true at all. More likely ONDO management misjudged it that's all. Share price had briefly touched 40p a few months before and 30p in the run up to the placing so 20.5p probably seemed dilutive at the time.
At the very least if that was the case they'd have certainly been able to raise considerably more at some price between the 20.5p placing price and today's 14p.
Anyway as predicted the SP is holding up well, I don't think 14p will become available on the open market.
As things stand it looks like V in US is still at/around the 12 month lows but in Europe and China it's off the bottom and showing signs of potentially heading towards $30/kgV.
'On V prices. We are getting close to the 360 day 0%, which is where we want to be. When, if, this turns green, hopefully within the next couple of months, Vametco can start making us money again.'
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All the 360 day chart is doing is comparing against the same point exactly one year bfeore. In 2023 V peaked in late March then fell sharply to a new lower level through May to August and then fell again to a new lower level in September and then again in December. So as the year goes on that 360 day chart will highly likely show some up as green but it will eventually this year be comparing not against a time when V was $40/kgV (March), not $32/kgV (May through August) but when it was $25/kgV.
So
It seemed plainly obvious that £1.08m wasn't going to go very far, a bit of a wasted opportunity to really make the most of the elevated share price in late 2023.
However despite the fact that dilution this time around is much greater 14p really isn't a bad result in this market - as someone on the sidelines I'm not sure there will be an entry as low as that on the open market.
Https://www.youtube.com/watch?v=4_pgfaOqsLQ
Similar to previous interviews but always good to get a reiteration of guidance (95k-100k Oz) as another month passes.
Segun makes the point that with projection of $300m FCF to be generated over the next three years with all debt being paid down this year then as long as POG remains at this sort of level THX is trading at a significant discount currently even if none of the forthcoming projects - extension of mine life at Segilola, development of Douta and Lithium - came to fruition, something that is highly unlikely to occur.
This year will be the first time THX is fully deleveraged so the optionality that such cash generation will bring is yet to be fully understood.
The point I'm making is a company like STX would not want to be raising debt until profitability was in sight but the recent poor performance and subsequent share price erosion has given them little choice... and not just once but a second lot of debt on top.
This now makes the risk of failure sky high.
As recently as July 2023 STX forecast becoming cash flow positive without a penny of debt to their name in 2024.
The likes of myself and others on here who understand just how poor recent results are know this is unlikely but now, at best (at least hpyothetically), they're looking at reaching a cash flow positive position in late 2025 with $30m of debt on the books.
Anything but absolutely perfect execution from here and they'll be needing to raise and since they've taken on so much debt in the past eight months that option will be off the table so a highly dilutive raise will be what comes.
This share is not cheap, its highly risky and speculative from here.
No not in a nutshell, Vametco isn't being sold. I assume you mean Vanchem the few times you wrote Vametco in your post?
But yeah agree otherwise. It was the same in December, a credible plan for the next twelve months to turn around the company but backed into such a tight spot that anything not going their way would cause major distress - the cost of SPR delaying payment, Acacia withholding funds and vanadium price sinking lower shrunk that cash runway to just four months.
This deal seems the only option but medium term survival is far from guaranteed.
Good point re efficient machines but this only really applies to entities with cash that have been able to renew their fleet in recent years with the most high tech rigs despite the downturn and now halving.
For the likes of Argo and I suspect the majority of artisanal miners? this won’t apply.
TGR will likely need to raise a good few times what they did in the Jan placing at a share price a third of what it was just to cover the July coupon, pay all the long overdue remuneration owed to staff, recruit a CFO and to get back into fully operation. That could be very heavy dilution to get back operating on an even keel.
I don't particularly trust this new group either but to act like they're largely to blame for the current mess is ludicrous, the mismanagement from Shishir is on another level.
It's an exaggeration as BTC didn't come close to averaging $60k in March 2021 but it still shows just how much mining power is now needed to generate the same revenue as the highs of 2021 - I'm surprised hash isn't falling considerably already but I guess give it another month or too and it'll probably gather pace, bitcoin being equal.
What's the assumption here? That difficulty is going to retrace considerably unless BTC starts rising?
It's amazing to think that the first time BTC broke $60k in March 2021 global hash was barely a quarter of what it is today, with double the rewards for minting one bitcoin so in other words, at $60k today vs $60k n March 2021 revenue being generated for miners is about 1/7th of what it was (adding a bit more back in for fees).
That's really bad and shows that you need seven times the hash to be generating the same revenues as $60k in March 2021.