Member Info for iWantThatOne

HUM need to produce 155k ozs at $500 margin to cover $77m debt in 2024. Alternatively, 140k ozs at $550 margin. Those do not seem overly stretching to me.

I don’t think it was all lies. I’m prepared to bet DB is as frustrated as everyone else. For whatever reason, Kor is not delivering the goods yet and causing all sorts of problems. You *could* say the company has done well to develop the relationship with CIG, because otherwise it’d struggle to find the funds to get Kor up and running, especially at short notice. The debt pile has probably topped out. I just wish they’d been honest in the RNS though, saying “look we’re having some issues at Kor, we’ll get there but we need some more cash and this time it’ll have to be equity”. The more I think about the BS of creating c50m shares to do exploration and Dugbe, the more my blood boils.

A bitter pill to swallow, this. Some random thoughts:

- There is no justification for raising $7m equity to accelerate exploration and Dugbe by just several months - these could have been financed from cash flow later in 2024.

- However the fact that they’re doing the above does lead me to think this really is just a misguided attempt to accelerate and nothing more, possibly driven by CIG. DB looked like he was in a hostage video.

- I struggle to believe that any issues with Kor or Yan are anything other than minor and temporary. DB has reiterated *again* that they’ll produce c200k ozs next year. At this late stage, if that is downgraded significantly then it’s over for him.

- I have no issue with improving the Dugbe NPV (and indeed advocate further exploration) but stop quoting it based on 5% - that bears no relation to project risks or cost of capital.

- The hedging on just 30% of expected production is prudent given the debt repayment schedule and will be welcomed by institutions.

What's brilliant about the video? How about the fact that AFC's ammonia cracker uses 5% of the electricity that an equivalently-sized electrolyser would? The cost of ammonia needs to be added in but it seems quite likely to me that it is far cheaper to produce hydrogen the AFC way. The electrolyser companies should be quite concerned about this......

Well this is huge. I get the concerns about potentially changing track to also be a hydrogen producer (though I don’t think that’s the main aim), but what a spin-off this could be. The question is, how does the cost of AFC’s cracker+electricity+ammonia compare to electrolysers+electricity to produce 1kg of hydrogen?

It’s not running out of cash, numpty. Have you even read the RNS or watched the prezzer?

Agree on Dugbe - DB has talked of it being a $1bn deposit so he’ll be loathe to let it go without further exploration to boost the resources. More exploration for 18m, sell and invest in a third mine the size of Yan/Kor.

Eh, where did you get this from? The company will grow as soon as more NHS trusts start offering contracts again - too many are currently sitting on their hands whilst they prioritise other areas of spend. Meanwhile waiting lists get longer, which can’t go on.

I’m looking at it this way. EV is c$240m currently of which c$150m is debt. In one year’s time c$75m of debt will be repaid and - if EV doesn’t change - that will see the equity value increase by about 10p, and a bit less again the following year. So 12p goes to 22p then 30p+. But that assumes the current EV is at the right level. If EBITDA is $120m (200k ozs x $600), to make the maths easy, then EV/EBITDA is only 2. That’s very low. Arguably that should be 50-100% higher. That leads to a price of 45-60p in two years time if execution is good and the POG doesn’t change materially.

So, on the positive front they were EBITDA positive and expect to be cash positive in H2. They have additional savings that will feed through in H2. The loss before tax is due to non- cash items. Those claiming a cash call is imminent are talking rubbish. And H2 is normally a bit better than H1. If they can achieve more or less break-even in current conditions then that’s pretty creditable. Doctors and nurses pay settlements being reached and a stabilised workforce should lead to more contracts being offered out over time. So this seems to me a perfect recovery stock right now. Let’s see what Wendy has to say on Thursday.

Bonker, yeah I get the disappointment when AiM companies promise the earth and fail to deliver. But HUM is a mining company. It’s not building a nuclear reactor, or developing innovative technology. It’s digging metal out of the ground - which it’s done before. There’s a limited number of things that can go wrong - especially now that Kor has been largely de-risked. Some people are acting as though it might still fail completely - which is crazy.

The presentation this afternoon made things very clear. Some people here just want certainty (and now!) but don’t realise the practicalities of developing a new mine. Betts admitted Kor has gone a little slower than expected but actually the timelines have been pretty normal for any new mine. Overburden stripping takes time. Dealing with local communities takes time and tact. The plant is fully working. Even were full production of 10k ozs/month to be hit only in January or February rather than year-end (and I’m not saying this will be the case) - so what? Er hello, big picture, people! It’ll still be a 120k ozs mine pa soon enough. From where I’m sitting, HUM has a number of things to work through, all pretty straightforward, with no real barriers to reaching full production at Kor. And those who are wetting the bed, you carry on. I’ll have your shares when you offload them thanks very much.

Don’t understand the grumbling today…..on track for top end of guidance at Yan, and on track for full production at Kor by the year end. 200k ozs next year. What were people expecting? Some genuine issues at Kor have clearly had to be handled, even ignoring the weather. The future looks extremely bright.

Harsh, Guvvi. This year HUM has had to develop a brand new mine plus develop a new underground operation after its open pit has been mined out. Hardly business as usual!

I’m expecting a mostly positive report tomorrow, some slight disappointments (time taken longer than we’d ideally like at both Kor and KEUG) but will be all OK by year-end and Yan Q3 production to be c20k. No issues with cash.

A commitment of sorts to $80m - positive.

The term sheet being with a single investor - positive.

The fact that the $80m would be part debt - positive.

The fact that the investor involved in the bridging loan (? unclear) has loaned a little bit immediately - positive.

But dear God AVO, get it done. These discussions are not new, they’ve been going on for many many months.

And it’s clear other radiotherapy companies are still in discussions only to pick clean the carcass if it goes into administration.

I hope the lack of news at the moment isn’t related to the Israeli-Palestine conflict. I can imagine that might give a lender reason to pause for a moment in case there are significant impacts on financial markets. That’d be typical AVO - ready to go and then the rug is pulled at the last moment. I hope not.

“Seamus Mulligan’s Nerano Pharma is poised to take a sizeable stake in AIM-listed Advanced Oncotherapy as part of a complex financial restructuring plan.

Trading in Advanced Oncotherapy shares has been suspended since July.

Nerano is a long-term backer of the company, which is developing a proton-based therapy for cancer cells. The Irish company has advanced loans of £23.8 million (€27.5 million) to Advanced. With rolled-up interest, the total sum due to Nerano is £27.8 million (€32.1 million), most of which is overdue.

Under the restructuring plan, Mulligan’s company and other lenders will agree to a debt for equity swap. Mulligan, through Nerano and Barrymore Investments, already controls 5.6 per cent of the equity in Advanced.

According to a company statement, the debt conversion may result in Mulligan’s company controlling over 30 per cent of Advanced, a level that would trigger a mandatory offer for the company under the takeover code. In such a scenario, Advanced is likely to seek a waiver from the takeover panel from the mandatory bid requirement.

Mulligan, a former Elan executive, is one of the country’s most successful entrepreneurs. He made over $500 million when he sold Adapt Pharma, a maker of opioid overdose treatment Narcan to Emergent BioSolutions in 2018.

Advanced Oncotherapy use protons rather than x-rays to maximise the destructive effect of radiation on tumours while minimising damage to the patient’s healthy tissues. Its technologies are based on research conducted at the Cern laboratory in Switzerland. The company was targeting in-patient treatments this year.

However, the company said in July that it urgently required funds. Aside from the debt to equity swap, the company plans to raise £61 million in fresh equity.

It is negotiating bridging loan finance with a number of investors, which it hopes to conclude shortly.

Separately, Nerano recently led a $5.3 million for Avectas, a Maynooth-based cell therapy company.”

Ac, your maths looks fine. However it implicitly assumes that Seamus Mulligan is being given 25p shares (as now) and that there are no changes to the nominal share price that would see existing shares split (i.e, “x for 1”).

It seems that what’s happening at the moment is a first stage in the recap plan - that all the debt due to have been repaid already is being converted into shares - which removes the immediate pressure but doesn’t provide working capital. The bridging loan will help pay back-salaries and outstanding invoices but may or may not provide a meaningful amount of working capital. And then the proposed full equity raise - which we’ve been led to believe *won’t* be for 25p nominal price shares - will raise £60m+ but at the cost of way more dilution. At that point, Mulligan’s share would reduce significantly from the 30%. As would our holdings.

Ok, so the Recap Plan RNS refers to the CS loan as “Nerano/CS”, so I guess we can consider that to be included in Nerano’s total. The June RNS stated that Nerano’s loans totalled £27.8m including accrued interest, so converting to Euro and bringing up to date can get to 32.1m. The debt-to-equity swap is on, then. Positive if it keeps the company afloat. Does the Times article mean we’ll hear about the Recap Plan tomorrow (“early October”)?

Thanks for the info but I can’t find it even though I have Times Online? Also I’m confused - Nerano Pharma doesn’t have €32.1m of loans. From memory they had about 10m plus interest (CS had c10m, the CLN was about 8m, and the interest in all those brought the total to c40m). I suppose it’s possible Nerano have lent more to repay the CLN or CS loan. But then that ignores Nerano’s equity stake of c30m shares. And they were always very keen not to go beyond the 30% stake overall beyond which a takeover bid would need to be put forward (tbh I’m hazy on that rule so I’ve prob got the detail wrong). Can you quote more from the article to clarify?