Stephan Bernstein, CEO of GreenRoc, details the PFS results for the new graphite processing plant. Watch the video here.
A few rambling thoughts:
MKA's problem has always been volume related. The daily volume is always very low. The price of low liquidity assets are always at odds with reality and often volatile.
This stock isn't going to reach its potential any time soon, it's under the radar and doesn't really have any tangible assets other than a serious wedge of cash. Knowing where some resources are buried isn't enough on its own; a solid, independently verified plan to extract the resources, and the cash to realise that plan, are the first step in moving MKA from treasure hunters with an X marks the spot to a genuine outfit. Fortunately MKA realised this years ago and set the ball rolling. The mining plan/feasibility study and the free carry from Noble will combine to elevate the value of MKA above cash and more in line with a discounted NPV. Any prediction of what that would be is futile, but I'd like it to be in the 15p region.
What could possibly work against this is the pricing in of a dilution risk to facilitate further exploration studies of Thambini or others. Personally I would prefer MKA to farm this out, but they will do what is best for them. If they want to turn this company into prodigious resource explorer/developer, then there may be a conveyor belt of projects which keep the share price depressed relative the value of the main asset of Songwe.
Same. The warrants and their conversion/expiry have been long known about and only represent a portion of total warrants and shares in issue. Twitter is, as ever, going mad - one chap shouting from the rafters of "30p easy" when the warrants are done.
If we're above 12p on Monday I'd be surprised. Every valuation, calculation, postulation and premonition about this stock has always been wrong. We all know it's worth more, but the volume is low so that won't happen. We'll open Monday on a bit of a run, but I think the real news will be that we sustainable sit above the 9.5/10p mark for weeks to come. The big gains will come when BFS and mining plan are released.
On twitter, the buzz appears to be about someone called "Wesfarmers" looking into a bid after failing to by Lynas (one of the few REM processors ex-china). How true these rumours are remains to be seen. I expect the day trading lot to put the SP through some cycles. Their BB and twitter comments make me chuckle.
Side Note:
Seems to be an awful lot of blind rampering on this board suddenly.
Everyone here already knows what REMs are used for, believe it or not, we all have Google too. So telling us about EVs and Wind farms just induces eyerolling. We know the true value here, hence why we've been here for years. Let nature take its course.
I think the real winners here are the warrant holders. Once the meteoric rise tapers off, the warrants will be converted at 6.6p and the Jonny-Come-latelys will scarper. Sending the price back down to +10-15% IMO. Once the warrants are done with, we may see some correlation with reality and actual value of the company...
I've been here since 4p, I'll treat myself to an extra custard cream today ;)
Forgive my ignorance, but are we sure this is warrant related? The volume on which the SP is moving is pitiful (30,000 shares to move 0.25p). If there are 1.3M warrants outstanding, would they realistically be being exercised in 30/50k chunks?
Mcap below cash level now. There must be a reason for this, but I'm too new to AIM to figure what it could be (legitimate or gamesmanship).
Even fully diluted, with all warrants in play, with a very conservative valuation we should be at 11p. More sensibly around 14p+.
Tiny volumes are moving the share price around.
The only thing I can think of is MM trying to trigger some stop losses? I'm scratching my head here. My average is 4.36p so it'll have to fall a long way before I get nervous.
Still learning the ropes, so by all means correct me. I'm just trying to apply some semblance of logic to this situation, despite the clear futility.
According to the Feb '19 presentation, fully diluted MKA will stand at 163.7M Shares in issue, + the 1.8M options granted the other day, so 165.5M shares. The dates for the options are in the future, but for the most pessimistic case, I'll include them anyway.
A market cap of £16M (Now + £7M) would put the share price in the 14p region.
A cap of £16M using the above figure for shares in issue puts it at 6.5p for a £9.5M mcap and 11p for post-funding mcap.
Is everything I've just said bollocks? Or is 11p a sensible target?
Thanks for the insight, PennyPusher.
I can't really fault your logic. But sadly, AIM has a habit of dropping trou' on logic. I'd agree at the 80% discount, call it 90% when you factor in those pesky warrants. I guess time will tell. I'm as much interested in this as an experiment as I am my own financial gain...
Thanks Cristalball,
I'm also in the 4p club. I hold a measly few shares, but the plan is to learn the game while I have youth on my side.
The TREO is the important part, but I imagine an Institution looking to make a sizeable buy would like/be required to interrogate the CPR before getting invested, even if it means doing so at a slight premium. Maybe I'm naive, but I imagine funds have rules about burden of proof before making a substantial investment. Either way, as a PI, it looks like we're quids in.
As for getting it out the ground, yes, it's not rocket surgery. 160m of overburden to chuck somewhere and we're away. But until someone figures out the details of where the equipment comes from, where the skilled folk to man to kit come from, accommodation for the people, how to get the trucks in, house the drivers, where they need to go to for processing the ore, how much the local mafia need to be bribed, etc etc it's not set in stone that this project is a go-er. At the same time, these blokes aren't idiots. They've had an idea about what this stuff will cost for years. But until it's all made official, it's just an opinion, a back of the fag packet thought. When MKA write this down on a fancy letterhead and show their working, I think we'll be in for a treat.
I'm an AIM newbie, but as I see it, the project from MKA's perspective is not derisked until ore starts leaving the site. A 25 or 50% share of the ore in the ground is still worth fractions of it's true value. The numbers being bandied around with regards to NPV and value at various stages are far from concrete and between this and the warrants I suspect that investors are remaining skeptical. Given the long term drag on the share price, there seems to be no incentive to get in early as the price will likely stay low until certain derisking hurdles are cleared.
Those hurdles as I see them are the 43-101 report, a certainty at this stage, but until published the resource upgrade isn't binding. With regards to value, this increases the value of the project, but still at a major discount due to very little detail (AFAIK) published publicly on how to get it out of the ground.
The feasibility study is the next hurdle. This should contain details of the mining plan, production route, an auditable assessment of NPV, an Opex estimate etc. Once published, things will start to get serious. Talaxis will then either give MKA a free ride to production in exchange for an additional 25%, or they will do something else. I don't expect them to walk away from a $14M punt, so perhaps someone smarter than I could review Talaxis' options here.
At this point the remaining risk is that of any construction project. Cost and schedule overruns blah blah blah. If Talaxis are footing the bill, I expect MKA not to dip, but the 25% share of the mine will only start paying when ore starts moving.
So all in all, I think that until the feasibility study is published, the price will remain in the 9-13p range. Please feel free to criticise my logic, every day is a school day.
DYOR
How are people defining FOIL?
The first drop to splash the pipes of the AM?
The first fill of the plumbing and the first drop into the tanks?
The first time design pressure is achieved?
The first time design flow rate is maintained for X hours?
Something else?
I've tried searching but not found anything substantial as to how this milestone is defined. Ambiguity here makes for a very wide range of predictions.
So the AM has the Grampian Dynamic sat next to her...
According to the blurb, this is an emergency response and rescue vessel. Is this standard procedure? For example, the AM crew receiving some safety training, or some kind of safety audit? Or has someone got the raging shits and needs evacuating?
source: Marinetraffic
Back from work trip to asia to a lovely RNS. A few thoughts:
Crunching the numbers shows that in the 8 weeks between updates, MKA are progressing with around 800m/week drill rate. With the total estimated to be 10,000m drilled, this puts us on a drilling end date of roughly week commencing 10th Sept. An RNS will likely follow.
The first batch of samples, with results due at the end of the month, show that the analysis will not keep pace with the drilling. The first batch is roughly a weeks worth. The second batch, also a week's worth, will "be despatched in the coming weeks" implying that we could be in for a wait for some tangible results from the field. It's a weak assumption that this lead time will be the same after drilling is finished, putting the completion date around July 2020. So I expect the next RNS to give us an indication of how quickly they are getting the samples through the lab(s) for testing.
Publication of these results before Xmas is possible, should they decide it's worth committing the extra resources.
Looks like another 4 weeks of SP consolidation on low volume while we wait for another RNS at the beginning of September, but positive news on the horizon.
DYOR
Opinion, not fact
Don't listen to a word I say.
In my (inexperienced) opinion, the Songwe portion of this company isn't going to influence the share price very much until something gets drilled. Between now and Q2, I imagine that warrant churn, Licence renewals, minor RNSs, ramping, deramping, transramping, glamping and tramping will dictate the minor swings in share price. After the drilling results, there will be a huge spike/drop in share price as the day traders pile in. Then it'll settle out closer to a sensible value - at a discount to actual value because it's all in the ground still. More than happy to be proven wrong, of course.
we got a mention on Bloomberg Europe front page https://www.bloomberg.com/news/articles/2018-02-02/electric-cars-and-niche-metals-lure-cash-back-to-african-mines
So after putting the SP at ~14.5p for 105M share in issue at the current valuation, adding ~27M shares would rerate that valuation to 11.5p (not including assets outside Songwe). This is still above the current share price, so I'd say that the incoming dilution from warrants isn't really worth fretting over. Nice to have those figures, MickR, cheers.
...Carillion's contracts? So Carillion's 40 odd thousand employees weren't sat on their hands - they were performing tasks that still need doing. So who will be profiting from CLLN's demise? Civils majors? Thoughts?