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Equity funding could be a possibility, especially if it meant a seat on the board. However I got the impression, from my questions that this was not on the table. The share price is so low, why should they give part of the company away at such low levels if they don’t have to. I would like to believe that with so much potential for the expansion of the resource, the 76% want it all for themselves! I wouldn’t and am just happy to buy at these levels. These along term multi year agreements, as has been stated, takes a lot of time to put together. Especially if there are a number of companies.
My opinion is that the off takers will buy the equipment, with a lease agreement with the company. They will then be entitled to a discount from world prices, which are in USD. The deal will involve a certain amount of upfront cash, to keep the company going until first cash is realised. This will avoid any more dilutions, which is in nobody’s interest. They will tweak the discounts to generate the interest in funding and upfront cash.
Time frames are certainly been extended, but so have the assets that we hold and the selling prices, valued in USD! There is 20% extra just in that, blows away our market cap. We have not had a tail wind within the country, which will have caused delays. We just have to wait, as I am sure our assets are doing the talking, the board appeared Uber confident, for what it is worth.
Shareholder Analysis
Total Number Of Shares in Issue
189,103,432
Key Information
Country of incorporation: UK
Country of operation: Sri Lanka
Total issued share capital: 189,103,432
Percentage issued share capital not in public hands: 76.8%
Significant Shareholders
As of 23 September 2022, the following were registered as being interested in 3% or more of the Company’s ordinary share capital:
Name Number of Ordinary Shares % of Issued Capital
Brent Holdings Limited 24,793,095 13.11%
Roman Resource Management Pty Ltd 14,423,869 7.63%
Stanton Investments Ltd 12,678,820 6.70%
KL Kepong International Limited 11,197,984 5.92%
Chulu Holding Pty Ltd 8,093,048 4.27%
Bart Properties Pty Ltd ATF
The Scott *****
Family Trust 5,496,409 2.91%
My reading of him is that he wants it signed sealed and delivered. He is not going to be pushed to titillate the market with its desire for information, when he has 76% of loyal shareholders who are prepared to wait for as long as it takes. In the meantime the share price suffers, but it is a buying opportunity for the perverse! Relax it will come, was the impression I got at the AGM.
I don’t remember that being mentioned. The concentration was on the off take agreements. These might determine what gets drilled next, depending on the type of deal. I was just glad to hear that the financial size of the off takers were of sufficient size not to preclude any type of deal.
The focus Is not shifting, there is just some worthy news to report that is worth reporting. The time frame for getting a value on the Hazen project has now got shorter. Both projects are firmly in play, ready for some associated valuations. We wait patiently.
It is good to go onto the website and remind ourselves of the projects we have. It is not hard to think of the type of deals for CS and Hazen that will create significant value to SRES, way above our current 5m market cap. Then we have all the other projects on top.
What a great RNS, every project is firmly in play. Exciting times, the build up to the big RNS putting commercial values in what we possess.
We are all right to be cynical with what an MD says, however having seen the body language and confidence, I am a believer. I don’t think it is too far away. They found it hard to believe the share price after the mining licence, and expected a rerate. The market is however never wrong! I think this is a great opportunity. I would prefer to invest in this company, with limited down risk and huge upside than invest in the general market. Very happy with the risk reward ratio.
Off take agreements can come in many shapes and sizes. According to the words at the AGM and the podcasts, MF says the market for our products are strong, there is concern over long term supply, and the companies we are talking to have big balance sheets. Now for me it does not require a great deal of imagination to think that these off takers and there are multiple, may want a small stake in us? Especially if they are providing the cash for the machinery. If we are dangling discounts from the world prices for our products, I can understand the interest. I was just pleased to hear that the companies are big that we are talking to.
Mine are as well, these are all going in SIPPS, long term dividends for the family. If all things come together, with the added potential on grades, depth and of course we have only drilled 10%, with new licences we have not touched yet. I can see the off takers wanting to expand the volume, as the demand is there. So we could easily see dividends being thrown off well above the current share price. The margins with our percentage are fantastic, so even if the prices fall we will always make profit. Just need some patience, I just can’t resist at these levels.
Not long now Safe, nearly there.
The new presentation is clear about the economics, and the added potential that is not in the figures. I think MF is embarrassed about the timeline he originally gave, as is now being cautious. The off takers have been on site taken samples, and I think negotiations are well underway and could be near completion. They have been going on for months and months. The negotiations include funding and they have a number of interested parties. The deal will be done with one or two parties MF said, and will depend on what minerals each off taker is interested in. We just have to be patient and let the assets speak for themselves, we have a fantastic resource, the value of which is compelling IMHO. Sit back and enjoy, as I think it will be a lot less risky at this level, than government gilts or any share in the ftse 100.
Director buys at this level, they are permanently in a rolling 30 day exclusion period. They could not say anything about a raise, all precluded information. It will all depend on the off take agreements, if the off takers are hot to get our stuff, any deal might include some cash, so no raise is necessary. It would be easy to give an off taker an extra discount for an upfront payment. I would also think the off takers will have a charge over the machinery. The demand for our product is there, they know that working with us guarantee’s supply for their long term security of supply. This is a big concern to the industry world wide.
I asked what their policy is going to be once the money starts flowing. Returning to shareholders, unless they are given a compelling investment case for putting it back into the mineral sands sector. I felt they meant it as well, not just lip service.
They chose to go down this route for the capital structure, but I bet they never thought the share price would be at this level! There is going to plenty to go around, and I got the impression that they had morals, so feel it is a very low risk. They have a track record and don’t want to finish there careers by doing the dirty. Character is far more important than money.