Proposed Directors of Tirupati Graphite explain why they have requisitioned an GM. Watch the video here.
No arguments on the acquisitions but they’d be more profitable based on a 6% loan rather than issuing more shares at 15%.
Just issuing more shares to buy things looks and feels more like a Ponzi scheme than a business.
I’m my view the problems with a placing for a mature company are:
- existing shareholders are diluted. I accept the acquisition should eventually bring market capital and hence share price back up but the inevitable drop in SP to the issue price ties in a load of investors until a SP recovery
- it smacks of an inability to borrow at normal terms due to banks not likely to assess finances and approve.
- it’s expensive! Issuing more shares when dividend is 15% effectively means you’re paying that rate on the new capital.
- today’s debt rework is far better with the positives of several 3rd parties reviewing figures and confirming they’re content to lend.
Irrespective of my views look at SP moves immediately prior to and after placing.
Repeated placing and subsequent dilution are an AIM strategy, not one for a mature, well financed company.
Krusty,
The BoD are partly responsible for the Share Price fall from the 120 area. They allowed the news of placing to leak which led to a drop to the 105 area over a very short time.
The placing was in direct contrast to promises not to do more raises and issue more shares. It also made it look like a slightly desperate placing implying banks were no longer ready to lend or extend current arrangements. This spooked the general market and annoyed many private investors who only had 24 hours or so to identify the opportunity, sort funding and apply. I was away so missed the relevant emails until after the placing.
Hopefully lesson learnt this time and new funding looks good - but markets and investors have a long memory so it may take a few years to convince many that they won't do the same again.
I still think it's a great company and a great share - but recognise they shot themselves in the foot here.
No oil flowing yet. Although agreement in principal reached weeks ago, specific details such as location of bank for payments, setting up account etc still not agreed. Turkey also want to agree a second arbitration case in advance of opening pipeline. Turkish elections delaying negotiations.
Given Eastern negotiation tactics there could still be lots of hurdles and lots of weeks with no oil flow.
Wilco, I have been reading. His opinions don’t match yours, get over it.
I’ve looked at his last post. He makes two points. VLS do not have any operating waste to end product plants. Fact, they don’t!
Secondly he says offtake agreements aren’t usually binding. Again, correct, VLS have had and lost several without a penny in income.
His opinions might not be supported by facts (as ours aren’t -else they wouldn’t be opinions) but I haven’t seen any evidence of him actually making things up and claiming them as facts.
I don’t think he is the world expert but he has been right more times than not on factual issues - unlike many of the unrealistic dreamers on here.
I’ve been reading here for last 3 or 4 years. In that time XPB has had many exchanges of views with differing posters but has ultimately been correct.
Think he’s frustrated because he liked the VLS tech but they let big airline partnerships fall apart, didn’t deliver on promises and have struggled with finance, project management and delivery.
To imply he’s a paid de-ramper because he doesn’t agree with you is lunacy.
Personally, he saved me from buying in at 7p ish levels and waiting to sub 4p. Hope that VLS can now prove that they have overcome their previous shortfalls, worked on finance and partnerships and now deliver projects.
GLA
I think reducing the dividend would have been the end of Genel as an investment option.
In all dealings with KRG Genel have to be cautious what they say publicly.
Hopefully, the possibility of re-opening pipeline is closer / more certain than they can say so they think dividend is safe. Plus they’ve had a load of cash for an acquisition and haven’t made one - so perhaps nothing out there at fair price currently.
Not very cheery.
Can’t move the stuff we pump out of existing wells so slowing that down drastically.
Starting up new locations going very slowly.
Still no sign of a producing acquisition outside of KRG.
Not much for the market to like today.
It’s not just being left behind, VLS had strategic agreements with big partners who subsequently walked away.
We’ve been overtaken and then left well behind.
Perhaps Wizz were swayed by a cheap way to empty the plane toilets rather than the technology of financial prospects for the company?????
Not sure you can say they have an exit plan. Exploratory drills in other dubious areas - and their record on new wells being productive is pretty poor recently (before they start on write downs).
Huge lawsuit with a bankrupt defendant - doubt there's much chance of anything there.
Declared strategy is to peruse M and S exploratory operations whilst looking to buy a producing well - the latter is where the focus and immediate returns might be found.
Still holding for the dividend but SP movement in the next few years will only come from confidence in certainty of KRG / Iraq exports with regular payments or an acquisition with immediate impact on the bottom line.
From Annual Report dated Mar 23:
"Raised our weighted average hedge floor on natural gas production to $3.63 per Mcf at 31 December 2022 from $2.97 per Mcf at 31 December 2021 further emphasising our ability to take advantage of an elevated price environment. Subsequent to 31 December 2022, we continued to elevate our hedge floor on natural gas production and presently
maintain a 2023 hedge floor of $3.83 per Mcf."
Their quoted strategy is to continue to raise the hedge floor - so I guess they'll be hedging when they can get more than (or close to $3.8 per Mcf. So perhaps more hedging on pause. Update at AGM on 2 May perhaps.
Ace,
If you're going to quote numbers then get them correct.
A few weeks ago I pointed out that all the numbers you quoted re dividends were a factor of a thousand out (presumably because you didn't read the numbers correctly in the accounts) and now you're doing it again.
Don't quote a cash generated figure of 1.2Mn dollars when it is 1000 times more than that.
It's misleading and you lose credibility if you can't read the accounts / convey the numbers properly.
i thought shorting as well - but can't see any evidence anywhere yet. Lots of very small trades in both blue and red today. Is that an attempt to move price one way or t'other? Can't believe PIs are really buying or selling those amounts. Anyone know if volumes over last few weeks have been significant?
Hopefully they'll do some magic at the AGM to at least set a floor here Guess we're in the "the market can remain illogical for longer than we can remain solvent (or patient)" phase of investment. Might just go and cut the grass.
Think as only news is oil flow problems, payments not received, arbitration ongoing, no idea who is in charge in KRG / Baghdad, the fact we’re operating in contravention of recent Baghdad court rulings etc etc I think they’re better off just keeping quiet and working hard in the background to see what they can improve then report on.
If you want an example of what poor cash flow management, leaks prior to placing and dubious loan arrangements can do to AIM companies take a look at the WBI forum.
Down 60% in a day after lender pulled the loan and big holder dumped all their shares. Yet still holders averaging down!!!!
Pipelines of projects for vanity, cashflow for sanity.
Any relation to SpongeBob SquarePants?