The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Gold rallying looking v interesting here
This board does go from one haunting to the next!
Evidently there’s a working capital gap as mentioned in the last one or two RNS: VAT refund likely a solution in near term /+ a working capital facility, give the recent RNS a read. If they get some money from any of these avenues clearly this is primed for a very strong move, just look what it did on tiny volume the other day +30%!
Interesting the Australian connection is highlighted they value graphite companies much differently over there perhaps the valuation disconnect will become more apparent through the new broker.
Plaza is bang on here, sensitivity around certain info in such specialist and competitive industries can’t be underestimated. Though I’m sure professionals reading this will enjoy reading Fairdealer’s post.
Very reassuring update. Tempted to buy in.
My read is that the visit to Madagascar in early Feb has got the wheels in motion for these which is why the timing indications are sounding more confident. If they do start to receive repayments of parts or all of the outstanding amount then things could change here very quickly to the upside based on the outlines in the recent RNS’s
Not one to comment too often but bizarre reaction to today’s Reach RNS - evidently the company is making an effort to demonstrate to a wide audience where it sits in the global graphite supply chain - this will probably be seen by new investors and even customers so likely a net positive. How many of us on here saw this map before the announcement?
The opportunity is very apparent - TG appears under-capitalised to exploit the advanced position it has got to within a growing market with huge potential, but as some others said, yesterday’s RNS laid out quite nicely some very close items that will go a long way to solving its operational issues I thought.
To address a couple of points from what I see:
The board has a makeup to drive things forward so I’d expect grievances at “stagnation” around certain matters will probably now end as things can be delivered further by an extended executive team.
Also good to see there is an active search for a CFO and new NEDs.
Importantly, the working capital facility as Saluc points out is being enabled by the Chairman’s personal guarantee. Now we don’t know how much the facility is worth but it’s a personal risk for the chairman - how many other execs would do this? If the amount is decent it could go a long way and shows the intent of the management to push forward while the markets are dire for tapping support. A credit to them for this imo.
Also the VAT news is very encouraging. We saw recent visits to Madagascar and looks like the momentum has been maintained in pursuing the VAT refunds - $2m back to the company changes its fortunes very quickly imo.
I agree Saluc, a major item raised of concern has now been addressed and now derisks this to a fair extent - the idea of TGR going private no longer holds water. Would have been good to be addressed sooner but this is a very positive development from my perspective.
Quite an interesting couple of RNS’s
Fantastic
Think we are nearing a rally point for Raw materials
Management have done seriously well here - oil pricing raging once again. if it looked strong at $75/bbl how does AET fare now with improved and larger deals at an oil price around $95/bbl!?
Suspension - said it was very unfortunate. He said that he is looking at building the TGR team to boost abilities on the finance and reporting ends.
Mozambique - currently still optimising the BAT studies per July RNS, enhancements to be had because of the ability to source things from India and better processing techniques.
Future potential expansion of Madagascar by extra 6,000tpa as also referred to in RNS, this was suggested as possibly to be done with own resources or by leveraging those resources following completion of the ramp up given the earlier discussion on maths at 2000MTs a month. If they achieve the ramp up, based on sales and cost numbers established so far in their previous results, it would potentially provide them more options for natural growth, so I guess it's wait and see.
Graphite market - sees a big deficit in 2025 and thinks TGR will be very well placed. The current situation will allow TGR to stand out while the others have struggled.
VAT receivables - election year in Madagascar means it’s harder to get much out of the government but that the money will eventually come, and they are working closely with the government to that end.
The next Sustainability report would be quite comprehensive and is on the agenda. Also noted comments on the pr and ir strategy and agreed it was due an overhaul quite soon.
Sees London as a good market but that it respects money making businesses and understood more institutions are attracted to those companies that turn a profit. He said he’s here to mine graphite and NOT mine the capital markets - I liked that. He wants people to understand there’s a business being built, just takes time. He made a comparison and he pointed to NextSource which is taking nearly a whole year to ramp up only a 17,000tpa module.
Overall my experience was positive and I felt enthusiastic about the future for TGR.
Been watching this for a while and it was suggested to me and I thought it would be a good chance to work out for myself what this is all about by meeting with Mr P this week. Surprised some have been so negative tbh about these meetings. I was reassured this 1 to 1 format wasn't a replacement of the online group meetings, but I agree with other posters that the opportunity for a face to face was a great idea for those interested in the investment thesis here, and of course is a great way to address concerns directly - much better than behind a keyboard or screen.
Couple points below and in next post:
Ramp up - this was said to be the priority per recent RNS for the stated guidance with the Q2 50% run rate and sounds confident for Q3 - hopefully the next results will back this up. At that Q3 target of 75% run rate, simple maths says at near 2,000MT a month of production and sales this would equal quite significant cashflow given the sort of expenses established so far in previous results. Nothing guaranteed but sounded confident and keen to demonstrate they can deliver. The prepayments sounded like they were useful for sorting some inputs needed to further boost the rate of production as well as of course winning new business and customers for the company.
Upgraded infrastructure and PCU flow sheet innovation provides more resilience to future poor weather.
The India connection is very useful as there is a larger spot market there which means consumers prefer to buy locally and is actually a way for TGR to break into that growing market - adds all sales are reviewed by their auditors.
Asked if he needs to raise given speculation online - given he wouldn’t raise in the mid 30s and the price is lower, plus the prepayments in August, was surprised this was even a question. He’s a major shareholder so has no interest in diluting his own or current shareholders’ stakes, especially if not necessary - he thinks the current value is crazy low vs peers, although acknowledges the guidance miss was big and suspension caused some concerns (which he emphasised were to do with processes for submitting the accounts not anything else), and that the prepayments are a prime example of how solid relationships allow the company to find innovative solutions.
It's just a matter of balancing between ramp up costs before becoming an earning company in the near term in my opinion. I personally think a big and quick step up is very possible based on some quick maths based on the figures achieved to date extrapolated over the next several months if and when the ramp up is fully achieved according to their stated targets. As referenced in RNS, they feel avoiding dilution is preferred, especially given the Company is hopefully on the cusp of what is hoped to be a much higher operational rate and financial performance than previous FYs should they hit their targets this quarter and the next and going forward.
Finally, always enjoy the RIO divis
Absolutely marvellous - looks like the HGZ crescent zone is slightly bigger now?
Results outside all reported drilling so far, open in all directions and at depth still. BLIMEY, never ceases to cause my jaw to drop.
MH
Nice to see the broker note today, missed it earlier and the late pop at the close was what caught my attention - good to check in and see many faces, old and new. Still long and strong since the early days of 2018/2019....hard to beat the economics offered by Havieron; a fact not changing anytime soon.
Still very excited for the rest of the year and the major milestone PFS towards the end of it...these milestones will fall like dominos, each more important than the last as we approach full on preparation for mining this resource and SD establishes GGP as a producer with a hell of a lot of free cash flow coming our way.
GLA
Well said Bamps.
It takes courage to hold even when the siutation is as promising as GGP's. Think of the value being unlocked down under as we write on these BBs. Much much more of this story is yet to unfold and I look forward to welcoming SD and hope GH keeps in touch with the company.
GLA
MH
Within the South East Crescent and Breccia Zones, 23 infill drill holes have been completed for the reporting
period, including 18 holes which returned assay results since the 10 December 2020 update. These infill drill holes
(included within the Inferred Mineral Resource boundary) are in line with expectations and increase the confidence
in the continuity of higher grade mineralisation.
GLA
MH
As a result having thought about it more I don’t think i’ve ever been as bullish about GGP as I am today, despite Scally - I’m not even fussed about the Juri JV. It is Havieron that is the key to everything. I don’t see an active, corporate guy like Shaun sitting around waiting for potential results to come in from our greenfield exploration programmes at our various projects (more likely he will divest them tbh). Like at Northern Star I think he will leverage the company’s assets a step at a time, in this case using the fantastic economics offered by Havieron to take the first step of really moving GGP into the producer league and out of the explorer league. This will be done by supporting the financing of any new acquisition(s) of small-mid cap, well run mines, with our sizeable asset and look to achieve a high and quick level of return by drilling out already proven resources and getting them mined in quick fashion. Early on in his presentation Shaun talks about the work of Northern Star’s Business Development team in identifying possible suitable acquisitions - and this should be something to look out for. This style will probably require greater institutional involvement and will take time and is the exact reason why we see a movement from impatient to patient hands of the shares.
Think about it - Havieron is great but for GGP it doesn’t offer any real work to do - it’s in Newcrest’s control and GGP is a major beneficiary; but Shaun Day is not someone who just rests on his laurels, he is a man of corporate action, and as I said before I can’t see him hanging around waiting for speculative exploration results to come in while Havieron is shining. Therefore value creation and recognition for the shareholder is not likely to come about through potential hit and miss exploration programmes (though this would be great don’t get me wrong), or at least relied upon so heavily with Shaun in charge. I would posit that a lot of frustration on the chat over the past week stems from people thinking GGP was nearing its true current value when it was in the 30s, although un-risked increasing to upwards of 60p (we saw all the DCFs and subsequent discussions etc) and felt a general sense that future big increases in the share price were becoming harder to foresee and there was an air of an unsustainable situation being apparent. That is why i’m bullish on GGP and Shaun Day, because his appointment is an inflection point, a sign that GGP does not intend to stand still, but move things forward in a way that Shaun has experience in being a major part of.
So, I am putting it out there that I think GGP will be making at least one acquisition in the next 12-18 months and will look to replicate a sizeable rise in underlying gold reserves and asset values that was seen at Shaun’s previous Gold mining company. Corporate action is the way forward and Havieron is the fuel.
GLA
MH
Presentation link:
https://www.youtube.com/watch?v=pRlshVfcnh0&feature=youtu.be
Just to change the topic from the intra-day share price movement for a second, I wanted to see if anyone else had been thinking the same thing: The Scallywag results have reminded us all about the nature of true greenfield exploration and reasserted how incredible GGP’s position is with the Havieron discovery.
The events and upcoming year made me think about GGP’s path going forward and the role of Shaun Day, the new incoming CEO. I urge everyone to (re-)watch and listen closely to his Northern Star presentation, the link for which I will post. In it he emphasises the style of management at NS, as being about “business first and mining company second”. He goes on to detail how through organic growth involving the acquisition of the likes of the Pogo mine, and drilling out the resource there to uncover multiples of the Au Oz content in situ, as well as at other places like Jundee, the NS management massively increased the profile of the company, value and its market cap. This focussed on having discipline around the financial returns of assets acquired and ensuring that each year they walked up the company’s reserve life i.e. drilling their projects to such an extent they grew the number of oz in reserves faster than they could mine them out (listen to his comments on the Paulsens mine).
A major part of this strategy involved acquisitions. While he was CFO 10/2014 - 12/2019 there were as many as 6 acquisitions (Jundee was just before in May 2014, transaction settled July 2014, but he would have been immediately involved in seeing operations were financed properly upon taking his seat on the board is my thinking, so I have included it as we know executive recruitment takes a few months). This strategy enabled massive growth over several years and put NS into its strongest financial position it had ever been in - also if you haven’t checked the share price for Northern Star between SD’s start and end date as CFO it’s worth it.