Member Info for HarChris

Yeah although I guess until they reach stable production at a much higher level the figures will be all over the place and difficult to interpret on a monthly basis. Once (if) they achieve that I imagine they'll switch to weightier quarterly updates. For now we get two main sets of results to work with and that's June and September.

A reminder that they have fallen foul of the minimium nasdaq price requierment for some time now and are racing towards the deadline for which action needs to be taken:

'In accordance with Listing Rule 5810(c)(3)(A), the Company has until 15 July 2025, to regain compliance with the minimum bid price requirement, during which time the ADSs are expected to continue to trade on the Nasdaq Global Select Market.'

Hard to say exactly but at June 30th GRL had $788k cash and at that point GRL were taking any money they could get. First £600k from an II in August then £175k and also $300k (to cover a debt) a couple of months after that. By mid November GRL had only produced 1920 (troy) ounces so that means 587 ounces between July 1st and mid Nov, a rate (~170 pm dore) that would have almost certainly tore through the cash and left finances on the edge even after the subscriptions, especially given the large current trade payment deficit.

And yet here we are today with no further money raised and still operating and building up production. That points to cash being generated likely around 375 dore ounces a month, something like that. That shows just how low cost the operations and just how much cash would be generated at 1000 ounces, possibly as much as $1.7m a month! If around 375 dore ounces keeps head above water then as long as production remains above that month on month during ramp up I see the risk as starkly minimised.

I also remind myself that the last two conversions took place at 3.25p and then more recently 49m shares were issued for a pre-agreed amount of the gold loan, 279 ounces. Today that 279 ounces equals £650k which at 1p would be 65m shares so again a good deal that's worked out in GRLs favour vis a vis today's price.

‘ But try flipping the argument on its head: If summer came & went & we still weren’t in production, how would HEX's SP react?

If the answer is "badly", surely the conclusion is that production this summer is at least partially priced in already.’

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Actually it’s tough to say. I think if summer came and went and production really did look imminent (despite slight delay) and all other aspects remained positive and on track and all was managed within the current budget then the share price would actually be much higher than 15p as key milestones would have been ticked off and time to production would be far shorter than it is today.

These days the herd all come at once on AIM. If all goes well here and there are no delays to initial production by say mid June I imagine position taking will begin in earnest.

Whatever the reason (management, comms etc) the fact remains that GRL absolutely have to stand on their own two feet and make progress without the need to tap the market whilst at this level if we are ever to see the likes of 4p. Looking at the production and past numbers it would seem that GRL were almost out of cash by the end of 24 and yet here they are in May without the need to raise so we must conclude they have been generating some cash these past few months at least.

So far so good, as long as this continues and around the 1000 mark is hit this year this will be a successful recovery play - but for this reason it’s binary, it will either be many multiples around q3 time or SP will have cratered.

If HEX delivers over the next six months in terms of hitting production and showing early signals of the $4m cash flows to be seen per each of the three wells then the potential rerate is enormous - tier 1 jurisdiction, relatively low cost high margin operation, 'Mr Helium' Bo at the helm - I don't see why a PE of 15 wouldn't be commanded, especially if there's confidence that Rudyard will end up with 8 producing wells and Ingomar has just as much to offer.

And at any point we might well witness another supply shock (is it four in last twenty years?) which would bring in supernormal profit for a period of time and see the share price spike and overshoot NPV.

There's a lot that can happen with limited downside unless execution ends up a complete failure.

Exactly that re 'pricing in production' - it's the opposite, what's being priced in is potential teething issues that could test the cash position. It's common and a possibility of course but if everything is delivered as currently being promised this will quickly rerate and reflect the (up to) $20m year net profit that can be seen for a decade. That's a share price at least 4 or 5 times where it is now with much further upside if the cash is put to Ingomar / new assets with just as positive ROE.

Absolutely. AIM is so short term focused, those that will have bought hoping for a gold price sentiment bounce will have now sold out as it didn’t come and now it looks like the catalyst won’t be here just yet either. Maybe a month away.

The medium term risk/reward has improved since you bought in seeing as there’s not been any bad news recently, the gold price is well above $3000/oz and the share price is sub 1p.

Without a sentiment rally though it becomes a play on the fundamentals, which traders aren’t so interested in.

CLSK it is a binary bet but the net assets are already roughly the market cap after CLN conversion (and with no goodwill inflation) and if merely this first target of 1000 ounces is met they immediately generate (forward) net profit that eclipses the mcap on top.

It’s a binary bet on these grades coming through but if the coin flip goes our way it’s at least 3 or 4X from here. And there’s every reason to assume the grade is there.

Well someone's dumping at whatever price they can get and I've bought a good chunk of them, for my sins. GLA, we'll know by mid year whether this is going to be a turnaround play or not.

I understand why you're so defeatist and I can see the frustration but there 'has' been operational improvements recently, they have achieved their stacking targets and there has been an increase, albeit modest, in production. Despite all their issues over the past three years since first pour they have survived and they aren't exactly in over their heads in debt, debt is still lower than mcap so the insolvency risk remains low and they have also flipped from hugely cash burning to most likely cash generative now.

Yes we need more but all is still to play for here.

Last week the main reason for such a fall was panic, understandable panic as questions were asked being asked such as 'is this an insider job?', 'could Mobico be about to be taken private?' etc etc - that led many to think it was better to get out at any price instead of losing the lot.

This week with Garat resigning, the results and now this £90k director buy puts the 'wipeout' concerns to bed, at least, and will give many more the confidence to buy in and walk this back up to at least 45p.

'As much as insider buying is a good think don’t get to excited as it wont move the price to much and to be honest a 90k pounds is on the peanuts side for someone like him.'

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Well earlier we had some on here saying 'if this is so cheap why aren't the director's buying?' and then it turns out one of them bought £90k's worth yesterday @ 34p. Who knows perhaps others bought today or even Cosmen?

Sure this won't get back to where it was a week ago but I could certainly see 10%, maybe even 20% rise tomorrow after this / especially if anymore purchases get announced.

If I was them I wouldn't declare it immediately as it will spike the share price at least 20%. Only once finished accumulating.

Only if there was no way out for Mobico but administration might Cosmen dump nefariously but that's not the case. Far more likely they end up buying the whole company for peanuts compared to what it was looking like a year ago (maybe 50p vs well over £1)

Agree with all that ID but the laziness in which Emma throws out targets doesn't build trust or confidence, so much so that we would now see a 50%+ move simply from delivering on what they were targeting in January.

I see it as an opportunity given this gold backdrop, the time they've been afforded to get past the 'teething issues' and the share price still being only at 1p but it's understandable why others don't and are continuing to avoid/sell out.

Everything rests on the next couple of months. See those grades come through and the target hit consistently and it not only puts the debt risk to bed it also opens up near term growth through the low cost second dry plant and beyond that further cash build and new debt optionality would bring those 6g+ grades into focus.

But the first step is essential to unlock the rest.

That's true that it's valuation gives some hope... and has been true for the past few years now with no obvious investment case yet a stubbornly high share price that allowed Argo to raise plenty of times to stay in business. One year ago the share price was still over 10p for example.

It has to come to an end at some point though. Maybe there's one more raise in them, who knows, but Argo has been on life support for at least two years now.

There's a lot of assumptions in there though, most notably that gold price stays around this $3300/oz level and that break even is $1m revs p/m. The latter seems a reasonable estimate, the former harder to predict.

'HarChris - did you suggest they need 750oz to repay the loan and remain profitable?'

Do you mean repay the loan by the Dec 31st deadline? Well at current gold price I estimate around 375 dore ounces as being break even so 750 a month could build up enough ounces to repay the gold loan in full just about, yeah.

Realistically though at 750 ounces a month here on out I imagine some of the loan would need to be rolled over once again or, if AIMS demanded it by end of year, a small raise to meet the shortfall in H2. The former hopefully.

Of course if they pull off close to 1000 ounce average from May onwards then it's all dandy, but who is expecting that?!