Member Info for hxulcolrdoh

It is now just over two years since THS shareholders expecting to reap the rewards of a bouyant commodity market had their hopes dashed and Phoevos with the quote "Capital will need to be more patient, or willing to explore new regions" announced the Karo Mine Holdings project.

THS was then 145.5p. It will be a long time before that price is revisited.

Since then the role of the two joint partners in KMH has been that Tharisa has supplied a lot of CAPITAL while Medway Developments has supplied NO CAPITAL but is supplying PATIENCE and looking forward to a 25% stake in the enterprise if and when it is completed.

No hindsight was required to see that Karo with a price tag of $391m to First Ore In Mine was a massive (and reckless) gamble on future commodity prices for a company the size of Tharisa. The outcome was always going to be somewhere between spectacularly bad to spectacularly good.

On the PGM operations I believe Karo would be slightly less profitable than at Tharisa. However frankly it doesn't look like PGMs at Tharisa are making money at present (in theory PGMs had a gross profit of $11.4m and chrome $66.1m - however this was after an expenses re jig, chrome expenses jumped from $70.1m -> $115.8m while PGM expenses were chopped $88.3m -> $66.3m ????).

Maybe commodity prices will recover quickly enough to deliver a 'get out of jail free' card to management re Karo. If so this will still not vindicate an originally ill advised decision.

Just an opinion but I'd suspect what was best/prudent for Tharisa shareholders in March 2022 took second place in the KMH investment decision to the potential outcome for Medway Developments.

Certainly without the Karo decision the '$100m in dividends over 9 years' record at Tharisa could have been substantially improved upon.

Maybe it it was this person who made the offer ?

https://youtu.be/TfMt3HN8tuY?t=13

According to Jensen H. it is boom time (and then some) in the world of AI and data centres.

https://www.theguardian.com/technology/article/2024/may/22/nvidia-quarterly-earnings

At Nvidia demand exceeds supply and even working flat out the company can't ship enough product.

Furthermore AI/AI accelerators has begat accelerated hardware / infrastructure redesign. Nvidia themselves say they are on a 'one year rhythm' where in a relatively short timescale an existing generation of products is blown out of the water by it's successor (must make timing a purchase / accounting for depreciation difficult).

AWE are definitely in the right place at the right time with the right toolbox and focus. The big question is can they muscle in on some of the action / claim some of the pickings? TBD. The CMD on June 4th will be interesting.

Re proposed deal and "why does Mr Sattar feel that the responsible action is to vote for it?"

Does he? The following implies he does not.

https://www.portillioncapital.co.uk/Portillionletter-BMN-06-05-24.pdf

See last paragraph

"Portillion is disappointed with the transaction as announced today and the way management have communicated with shareholders and is inclined not to support it when presented

to shareholders at the general meeting."

Curiously the implied date of the document pre dates the announced date of the relevant RNS.

Shorter video

https://www.youtube.com/watch?v=b5A8w_IgBE0

Re my point that the calibre of modern politicians has imploded, I note that the same trend is observed on the far side of the pond.

https://www.youtube.com/watch?v=ZfgJl81p0nM

It would be funny if it was not so tragic. How did we move from the authors of the constitution to this.

I take you have your hands on your tool in your hands.

I will have to look into AI.

Clearly past penalties were no deterrent.

Presumably potential receipts are judged to exceed potential penalties and the penalties are just a business cost.

See pb940's link

Vanchem to be sold to SPR for $35.6m (min) -> $40.6m (max).

Having already received $11.4m a further $9.5m would be delivered over the coming months. If a Vametco sale agreed then over the following 3 years a further $15m -> $20m would be disbursed.

Based on unaudited management accounts for 2023 Vanchem's loss for 2023 was $32.2m (VametCo not diclosed).

Following a Vametco sale (and provided Orion agreed an expected ADDITIONAL $10m of loans) BMN would have $8m of cash reserves and $90m of debt.

The company have told the insolvency people that if all the above came to pass and "assuming unconstrained production and an average selling price of US$30/kgV the Company would have sufficient working capital to sustain operations" they can limp on.

The insolvency advice is that any deviation from execution or expectations and it is probably curtains.

An excellent discussion on energy policy (USA) - worth downloading and listening to.

https://www.financialsense.com/podcast/20900/mark-mills-policy-vs-reality-and-coming-energy-storm

There is some relevance to AWE in that large demands on energy in the future will come from AI and data centres. Anything that can be done to mitigate such consumption will be in demand.

Needless to say anyone with wit/competence/ability has long since abandoned politics to those who can squabble on twitterface. I very much doubt if elected officials anywhere with degrees in maths/science/engineering number 1 or 2% of that population - if even that.

Or put it another way, the long term debt (which BMN hasn't a mission of paying back) is going to be twice as hard to pay back.

I would be surprised if Orion are agreeble. Why would they kiss goodbye to half the assets on the balance sheet at the same time as their chances of default doubled.

On the SPR front going forward BMN gets maybe (subject to a deal being agreed/approved) $9.5m for VanChem ( $11.1m having been recieved and which disappeared like a fart in a hurricane) - 'the initial consideration'

Plus 'Eventually' over 3 years after a deal is concluded BMN will get $15m -> $20m as a deferred consideration' in quarterly installments.

Which does raise the question - if the plug was pulled post a SPR deal close what entity would in receipt of the deferred consideration payments ?

BMN really does look like toast.

Re "Vanchem and Mokopane is around half the total combined company, so what we have left must be worth around the same at least that SPR will have paid at a fire-sale price, you'd think. "

Unless half the vast amount of debt that BMN that owes went with the Vanchem sale - I don't think.

I think you will see Michael Schumacher pottering about before you see BMN in good health.

I'd like to think that they had put all further processing from this claim outfit on hold until the matter was resolved.

Ditto on AJ Bell account

In the context of the evolving business

- I doubt if the out going NEDs were adding much value.

- I don't doubt that they could be replaced with better NEDs (ie directors with more relevant domain knowledge)

So, as long as they are indeed replaced by 'Directors with relevant Board experience in AI and data centres' the development seems like a good one.

With an outcome yet to be determined, AWE have ditched all products, product lines, markets etc that are a distraction from where they think they are uniquely placed to capitalise on the big growth opportunity of the age - AI and datac entres. It will be interesting to see how things unfold. I am already looking forward to the Capital Markets Day of June 4th.

Https://www.zdnet.com/article/generative-ai-spending-to-reach-143-billion-in-2027-according-to-idc/

"The forecasted growth of generative AI investments is more than twice the growth rate in overall AI spending and 13 times greater than the CAGR for worldwide IT spending over the same period, according to IDC."

It would be nice if it was accurate and AWE could capture a % of the market.

From a TSMC point of view, their main partners in various areas

https://www.tsmc.com/english/dedicatedFoundry/oip/3dfabric_alliance

Thanks rz105 for excellent insights!

Frustrating as it is to have a lack of FINANCIAL visibility on future product sales for Connectivity Silicon IP / Custom Silicon / Connectivity Products, on the ENGINEERING front AWE do march relentlessly on e.g.

https://www.thetecharena.net/content/memcon24/alphawavesemi

Fingers crossed the "build it and they will come" approach will bear fruit.

The company does throw out a few tantalising teasers e.g.

- They say they see "$500m potential lifetime silicon revenue based on 2023 design wins". Presumably as time goes the increasing number of design wins results in additional and increasing future revenues.

- At the time they acquired Banias they said "Alphawave has negotiated a non-binding, multi-year purchasing framework with a leading North American hyperscaler that proposes a multi-year roadmap for Alphawave to develop and sell a portfolio of optical products and DSPs, including coherent DSP technology from Banias Labs, with sales potentially ramping to over US$300 million". The production line for the Banias related content is expected to start rolling in H2 2024.

On the one hand the teasers do not lead themselves to any form of modeling ( over what timescales are products delivered ? are sales front end loaded ? back end loaded ? evenly spread ? ).

On the other it is clear that AWE are serious players in a burgeoning market.