Member Info for HarChris

Apologies, wrong link there!

Yes this is much closer to the truth for why people like PI100 are still here, they aren't seeing a better place to put their money in right now vs Novacyt at today's price. Even if you have no faith in the management, you believe that between the dispute and just general news flow (new products hitting market q4, m&a in the future) the price will be considerably higher than today at some point in the future and that can't be said for other shares in such uncertain times.

So whilst you shout for 75p or 50p or whatever when you're in a particularly destructive mood the truth is that you don't really believe that all is lost here, you just feel better about any fall if you've at least 'called it'.

In my opinion the question we need to ask isn't how low might bitcoin go but how long might it be there for?

A big flush in the coming months to <$15k followed by a strong recovery is a far more preferable outcome than a simple drip drip down followed by the odd deadcat bounce and then more of the same through 2023.

If we do see BTC go lower in the coming weeks will Argo be forced to continue to sell to keep the lights on or is their balance sheet strong enough to hold off for at least $20k+ ?

I did okay with Corz, bought a couple of times on the way down to that low with an average of 1.75 but got a bit nervy and sold earlier than I prob should have, at an average of just 2.3.

Yes following closely but don't think I'd touch Corz now... if we see capitulation I'll be looking to buy the miners that have shored up their balance sheet and are near certain to make it through a long drawn our bear market.

Today feels like capitulation and the realisation of the threats ahead once again. Quite amazing that we've seen the likes of Corz go from 1.4 to 3.4 and back to 1.65 in the space of six weeks, Hut8 from 1.65 to 4.6 and back to 2.49, with nothing but a deadcat BTC bounce to $24k causing it.

Interesting times ahead.

Worth pointing out that we are looking at $31/kg breakeven in 2023 due to the increased scale from Vanchem and minimal capex spend. From what we can gather US prices are currently ~$46/kg, China $36.5 (and so rest of Asia and Rest of World?) and Europe $31/kg. Prices staying exactly where they are with just a little adjusting for geographic sales and we're looking at something close to $50m profit in 2023 (before tax).

If we get through the impending recession with a tidy profit to show for it then we really are going to be smelling of roses on the other side.

At 62% of their net cash figure one could argue that most infectious diseases of the world being eradicated is priced in!

Whilst it's certainly true that European prices are more relevant than Chinese prices on the face of it, it's a little more complicated than that. Fortune has stated numerous times that BMN are able to pivot to regions and markets depending on demand and price. Sales to China have only dried up because it wasn't in our interest to sell there but if demand from Europe is falling and vice versa in China then I'm sure we will start seeing sales pick up again to China... and as long as they keep rising it will still be profitable even with that import duty. (Sales to China in 2020 were ~20%)

China is also widely regarded as the bellwether for the vanadium market, as they are the world's largest consumer and producer by some margin. For that reason it can only be positive that prices are rising so significantly as any tightening supply will, without doubt, have a knock on effect globally in time.

As for Europe let's keep a keen eye on what happens with Evraz. By my calculations Evraz produces about 13000mtV equivalent which is about 11% of global production, any threat of that supply leaving the market or even being curtailed and the picture will look very different once again.

No, absolutely no evidence of Lind pre-selling, was just a made-up rumour that one or two individuals have decided to run with.

40p is just the UT, actual buy price just before close was 38.5p for any meaningful amount.

Still, can't deny how well the share price had held up for whatever reason . Hut8 down 9%, Corz 10%, Riot 10%, Arbk 1%?

... there's no chance*

So there's a few ways this could play out. Ideally the price of vanadium holds up enough and sales increase over the next fourteen months to allow Bushveld to pay back Orion next November in full. This to me is fairly likely but obviously not certain. So the second option is that Orion, having already proved their long term commitment to supporting Bushveld, renegotiates the CLN and allows for it to be paid off over a longer time horizon.

And even if both of these fail all we will likely be talking is a shortfall around $10m. With $296m assets and net assets of $149m it is not going to be hard to find a new lender to cover whatever Bushveld requires.

Yes you are misunderstanding the situation but I'm happy to break it down as simply as possible:

The debt that is constantly being talked about and is the biggest drag on the share price is the CLN with Orion Finance agreed in Nov 2020 - this was a $35m loan with 10% yearly interest over three years coming in at $46m due November 2023. Of this ~$4m has been paid off so let's call it $42m.

At first glance this appears to be a problem, as of June 30th BMN have $7m in cash so that would suggest a looming debt with a $35m shortfall is fast approaching - bad! Panic! But let's dig a little deeper.

2022 was a year of big expansion, taking Vanchem from the a 990mtV producer to around the 2650mtV mark by the end of this year, almost tripling its output. Now, however most of the heavy capex has been sunk and will reduce to near zero through 2023. This means that BMN are well placed to start making considerable profit over the next fourteen months, with $35m cash generation easily possible in that time frame.

Added to that is the build up of inventory which stands at 826mtV. This is product that has been fully costed and is ready to go... if we had simply seen less logistics/supply chain issues and managed to sell all that we produced we would have a further $30m in the kitty at a conservative $36/kg sales price. This means increasing our sales alone through the next fourteen months so that sales exceed production will more or less make up the debt shortfall alone.

Finally let's assume BMN do end up short of that $42m they need between now and Nov 2023. Well as I've already said the funder that we need to payback next November is Orion Finance. This is not our only obligation to Orion, they are in fact a long term partner of Bushveld's having signed a long term PFA ($35m) at the same time as the shorter term convertible loan note. So any difficulty Orion puts Bushveld under threatens the longer term agreement they have and potentially costs Orion the rest of the money they will eventually be owed. Let's also look at the commentary that came with these financing deals:

Philip Clegg, Portfolio Manager at Orion commented: "Orion is delighted to become a cornerstone investor in Bushveld. We have been attracted to the quality and growth profile of Bushveld's portfolio of mining and processing assets for some time, and we also recognise the leading role that the Company has assumed in the supply of crucial raw materials to the vanadium redox flow battery industry. We are looking forward to partnering with Bushveld as it continues on its growth trajectory and supporting the Company as it realises its full potential."

... a cornerstone investor. Do we think a cornerstone investor with a long term production finance agreement is going to attempt to force BMN into liquidation at the first mispayment? Do you think as a major partner with other small cap miners they will damage their reputation by showing zero flexibility to BMN? No, there's no cha

Being a bot Simply Wall Street doesn't know that Bushveld also has a Production finance agreement (PFA) with Orion - they are long term investors who are supporting BMN on their growth journey.

it is absolutely not in their interest to suddenly strong arm BMN into coughing up the $42m in November 2023 if BMN do fall short, it's absolutely in Orion's interest to renegotiate on reasonable terms.

There's certainly too many moving parts to know for sure but there is a limit to how long miners can sustain such heavy loss making. Then you have to add into the mix the number of mining giants raising money and continuing to increase hash rate which pushes up difficulty and means even greater loss making across the board, especially for those unable to expand in this time and benefit from increased mining output.

Like the discussion I've had with AB recently, PW's apparent unease around a placing will benefit Argo if bitcoin rebounds in the coming months but the longer BTC stays depressed the bigger the risk compounded on Argo. And like Hexam said, perhaps around Christmas we might start seeing some visible pain from a major miner or too.

I'm rather surprised how well the Argo share price is holding up - a good 25-30 percent higher than what it was in mid to late June when BTC was ~$20k.

To me three months of depressed prices makes Argo today a riskier investment than it was in mid-late June, yet the share price is a fair bit higher. We are now likely just three or so months away from real pain being inflicted.

Come off it CS, if he right totally effs up this job at novacyt he is not going to walk into another CEO role. I’m sure he’ll get away with mediocrity here but not total failure.

Novacyt are quite visible now publicly, there will be no shortage of anger and criticism for a recruitment team to uncover when he goes looking for a new job in those circumstances (utter failure here).

Exactly Ben. All BMN needs to do is make it through any downturn, any worldwide recession, any period of depressed V pricing until the time that V reverses, because once it does in an instant we are looking at a company capable of making near on $100m profit a year even before that next expansion to 8000mtV.

So you see no conceivable possibility that things change going forward? That M&A activity heats up in 2023, that new products will start delivering in Q4 (like the management themselves have stated)?

Nope for you it's black and white, this company is finished, no bones about it. 100% dead in the water, £99m squandered like that.

Why is everyone constantly fighting over whether covid is alive and kicking or over? This isn't 2020, this is 2022 and the profits have already been crystallised and sitting in the bank.

Novacyt is now valued 6 times what it was before covid but has 64 times the cash it did whilst wiping out the not insubstantial debt.

So fundamentally transformed due to covid, whether there's revenue to be made from it going forward or not.

You may be right but I'm an ever evolving human being that no longer makes such claims - in fact I've pushed back hard (on telegram at least) anyone suggesting 6p, 5.5p, 5p, is the bottom.

Let's hope you're ever evolving too.