Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
I've been incredibly bearish since the last results and saw good reason for the slump to 1.5p but there's no doubt that sub 1p is pretty good punt money for a lowball TO in the 2s later this year.
This isn't just about whether or not BMN can survive but in what form that comes...The last time a cash call was signalled the share price was about 3p, this time around it's 0.6p so it's obviously going to come at a heavy price.
We don't know what the future holds for the vanadium price but we can definitely say that it's not going to come to our rescue in the very short term, which is what is most needed at the moment.
Yeah. To the outsider who doesn't follow Argo too closely monthly revenues will look something like this, unless BTC rallies in the immediate term:
Jan - $5.3m
Feb - $4.5m
March - $7m
April - ~$5.6m?
May - $3.8m?
That March figure is what was needed month on month here.
Zero. It's not in the interest of the new directors to redistribute cash to shareholders as they don't own shares until December 2026.
They might distribute a small 10p dividend as a gesture but much above that isn't happening.
Exactly. The question is will Chippas signal a new direction and if so will the market buy it? Only a SP spike and a massive raise off the back of it keeps Argo alive into 2025
As I’ve said before if Argo was valued at £15m now they’d be a punt to be had on survival but at £70m the potential upside isn’t worth the more likely outcome of failure.
The question is what's the cash burn now from May onwards, with BTC at $65k and hash rate at all time highs - $2m? That would mean runway only until Q4.
Hopefully Thomas answers that and a few other testing questions I've put forward for the Investor Meet
I agree on the whole about going overboard on the acquisition front but boy will there be opportunities out there.
Remember we were talking GDR a few weeks, impressive progressive made but signalling their need to refinance in the very near term - share price continues to struggle, fighting to hold 5p now/£7m mcap. If you can buy a potential like that for sub £10m then let's say ~£70m post dispute is going to be quite the war chest for LR.
That can't be right, surely? A $28.1m placing and a highly supportive gold environment and yet net debt (inc gold inventory) has increased from $119.3m to $135.1m in 9 months? And cash back at $5.4m / $9.1m if inventory can be sold?
Another fundraise due to all the operational issues it would seem.
Cash position solid at $12.4m as of end of March and pre halving, buys them time one would think.
Something that stood out for me was the sky high direct bitcoin costs in Q1, $31k direct mining costs in Q1, that's a huge jump and would suggest that cash break even is actually more like $100k post halving right, Hexam? Or do the non mining cost reductions counteract that enough?
What we also have seen recently is meaningful director purchases from both Lincoln and Aristide well in advance of the improved cashew operation in which they've signalled for June.
And notable is also the fact that none of the directors, who own significant stakes, have been selling shares for any reason.
This is the updated rns Ben from 15th Dec: https://www.lse.co.uk/rns/BMN/definitive-sales-and-marketing-agreement-with-spr-h1q274x741r4o80.html
'SPRF marketing and sales arrangement will replace existing marketing and sales arrangements as and when they expire between June 2024 and June 2026.' - is that also when the credit facility is meant to kick in?
'How can we say company does not need immediately they need to pay 7 millions to Orion shortly '
Actually that appears to be true, read the bit below in the middle:
60% of the CLN Balance (US$28.3 million) will be converted into a secured term loan ("Term Loan") on the following terms:
Interest: 6.0% ("Margin") plus the greater of (I) 3-month Secured Overnight Financing Rate ("SOFR") and (ii) 3.0% per annum.
Interest payable quarterly in arrears in cash starting from the last business day of the quarter in which the closing of the transaction occurs and on the last business day of each quarter thereafter. In the event that the Company has insufficient cash available to pay interest on its due date, the interest due on that date shall continue to accrue. While there is a continuing default, the Margin will be increased by 3%.
O Principal repayments structured to:
a. 25% of the Term Loan (US$7.1 million) to be repaid by 30 June 2024.
b. 30% of the Term Loan (US$8.5 million) to be repaid by 30 June 2025.
c. 45% of the Term Loan (US$12.7 million) to be repaid by 30 June 2026.'
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Obviously it means racking up even more debt and interest though but in terms of short term survival there does appear to be wiggle room.
Thanks, I think we can all agree like you say that this management have done an excellent job of surviving up until this point and in buying themselves time - I imagine they'll attempt one more placing in 2024 and that will guarantee survival until at least the hosting agreement comes to an end.
The cost cutting that can be made pales in comparison to the lost revenue from the fall in vanadium prices - year on year (Q1 on Q1) average sales price will have reduced by about $13.5/kgV, that's $13.5m per 1000mtV produced / $54m if extrapolated out for an entire year. Craig might be able to get direct costs down further from here but spending is necessary to really reduce costs, like with the barren dam, and BMN don't have the cash to do that now. You then have significant financing costs and interest on the debt that can't simply be reduced. Of course that was Craig's plan from day one, to deleverage the balance sheet by selling off some of the assets, but so far all the financing has been eaten up by cash burn and legacy debts.
And what do you mean 'stopping production is not going to work, or even happen'? The losses per month now will be more than the $2.2m cash BMN has remaining, they won't have the funds to pay staff, suppliers etc without further funding forthcoming. It's not a tactical halting operations if it happens, it's a necessity.
Are you clued up on when their debt matures? Is any of the remaining $55.2m due within the next couple of quarters? If so that'll be the next big hurdle before the end of the year when the hosting agreement ends. I know the senior notes aren't due til 2026 but I wasn't sure about the other $15.2m.
I'm sure a while ago you said Argo's cash break even was around $35k so i'm surprised you still think $60k-$70k post halving with how much difficulty has adjusted upwards since (ignoring temporary inflated fees), I'd have thought new break even would be more more like $80k-$90k but like you say, there's no room for growth and realistically any modest cash that is generated will need to pay off what's left of the Galaxy loan.
I agree with all that, I just don't think Argo will be one of those miners that does 3X to 5X i.e £210m to £350m even with BTC over $100k. Argo won't benefit from the higher price in terms of BTC held and will lose out on the difficulty front as it increases and they fail to grow to keep up with it. Argo probably won't even be generating cash at that BTC price if fees have come back down.
There's big moves to be had with some of the heavyweight miners though, that's for sure.