Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
OSG i dont think anyone here can question the facilities potential for growing or the volume of which we can grow and just how much we are already growing. the issue arises when we come to sell it. This for me is the biggest problem as i do not believe we will shift it all, and will end up with a stockpiling of the stuff as our future sales will be almost non existant for what we need. If you start stockpiling or cutting production, those are alarm bells you cant sell it in the quantities you need. We are already starting to see this under the pretense of 'making sure we have enough stock' as i quote from a recent RNS Sept 4th strategy update
" The Company has also increased inventories at Zoetic ahead of several significant presentations to potential customers. Should these meetings be successful, it is imperative that Zoetic is in a position to fulfil orders quickly." the less you sell the more your 'inventories' increase but by doing it under the guise of making sure you have enough stock to meet demand just puts a positive spin on it. Nevertheless, its been for sale in the UK since 9th August so im looking forward to seeing the sales figures from the UK for the past 2 months, im sure it will be an entertaining read. This is my current take as things stand with the information we have avaialble but happy to be proven wrong and the company to have incredible sales but i just cannot see how its possible with so little visibility in the cinsumer market.
It doesn't matter if you are a LTH, ramper/deramper, we are all here to make money from this company be it long term or short term. For that to happen we need revenue and profitability beyond just paying salaries so shareholders can see some value. With the restructuring of the company for solely CBD now it will be interesting to see in the next week or so just how our overheads are looking to give us an idea of exactly what sort of revenue we need to be bringing in for this to be profitable and represent shareholder value.
BH the team they brought with them are simply based at the site and are not part of the BOD nor are they directors, they are making their money anyway from the leased site and presumably a decent salary to boot, the incentive is great but they are getting the warrants anyway. As for NT, whilst a CEO needs time to turn things around this share has done nothing but fall since its inception along with a lot of dilution since then. in real terms from 40p+ this is probably 1-2p now with dilution taken into consideration. So understandably patience is wearing thin and shareholders need to see results. When this was launched they informed the market by years end this would be profitable ergo self sustaining, so these october numbers need to look good. any sense of loss along with a jam tomorrow statements would just reaffirm current suspicions that its more of the same.
sorry for the terrible formatting wall of text!
I think the reason some people, myself included do not look at this as just a new venture is because its essentially HNR but in a new wrapper, a lot of the same faces are within the company that have been there a while the BOD doesn't look much different either, they simply swapped names to shake the past off and look for new investors to rinse and repeat. Sure you could argue RP was steering the ship but its the BODs jobs to hold him accountable and if they were worth a damn and the sort you'd see at a well managed listed company they would have got rid of him a long time ago, quite what his bonuses were based on (clearly not share performance) that he was still due some and chose to forgo it says all you need to know about how the company is run. The resident rampers on here were singing RPs praises and quickly changed tune the moment he was out the door. The only real information we have to go off from this company is the facts we have in front of us and not jam tomorrow statements and a pocket full of dreams, and right now the facts are the shares at all time lows, we have nothing to show for all the money the company has received over the past couple of years since the ED deal and are currently in the dark for this new venture with the only information we have so far is that they have needed to draw down a bank loan of half a million and take a money from a few new investors they apparently alsostate they didn't need. The facts paint a picture of a company running on fumes making 1 last roll of the dice. I am fully expecting there to be some sales figure numbers in October if only for the stocking of shelves, id be more interested in seeing sales beyond this though of which i do not expect there to be many at all. I also still stand by my statement that we are unknown, do you have any idea just how many brands are selling CBD in the UK and US? why not try googling to buy CBD oil as though you are a customer and unaware of zoetic and its brands and you'll find you never come across it unless your looking for zoetic specifically or leafyquick which arn't exactly a a big seller and even they list lots of other products. The reviews alone for ours are probably from investors.
the business launched right after full year results, maximising the amount of time they can keep people in the dark with sales figures/revenue for this new venture. When the numbers do come out for this i fully expect them to be dismal, the writing is already on the wall that we will need funding and at current share price the dilution will be massive. outside of the inner circle of shareholders and vendors/distributors who even knows the products exist?
whilst this was inevitable with all our eggs in one basket and the shifting of the core business. You can’t help but laugh at how they plan on disposing of those assets. As some rightly said, what’s going to happen here is the assets will be sold dirt cheap and to massive loss after investment from Hnr as the guy negotiating it is also the one buying it. After the purchases he will walk away and then sell the nitrogen mix back to us at an inflated rate. Later down the line the BOD from here will all probably end up leaving or closing the dead duck if a company and joining the board of his ‘newly’ established company. All this company has now is an a cbd business that cost less than £1.5m to set up, with the sale of all other assets including ED and with no figures on sales, the company as far as I’m concerned is esssentially worth sweet FA at this moment.
gallini - "Nice to hear RP has bought a round of drinks at the AGM"
that is the first return on investment those attending have seen, maybe if he inebriates them they will buy some tinctures from the boot of his company car. The only positive thing about today has been the retorts from BS on this BB.
The RNS spells out where we are as does the share price and other information released, now some are suggesting OTC could make us sky rocket, it might be a billionaire investor thats the HNWI and RP is a man of integrity. you couldn't make it up.
The RNS finally puts in black and white what a few people including myself have said over recent weeks, all our eggs are in one basket in a market that is saturated.
I refer people to this quote from RP in an RNS on the 19th march 2019 "Highlands expects first revenues by mid-2019 and profitability by year end" yet here we are, taking money of people who had money they wanted to invest that RP despite not needing funding near term, apparently took at this low share price and has used the funds immediately. It would be my guess that the sales are pretty much trivial compared to the outgoings this company has, id be surprised if its even taken $10,000 to date.
If you need any further reason to believe this is a dead duck despite claims of stores we are in and distributors we have and websites ask yourselves this one question. If you were not invested in HNR or dealt with the company at all previously, would you even know of their CBD brands existence? I have said several times the question that always goes unanswered is why did the District 8 team sell up to HNR rather than buy gas and take this on themselves if it is so lucrative? they are experienced people which tells us the one blindly obvious fact of it all, this is simply not commercially viable on the levels HNR thinks it will be in such a saturated market for such a small company. As someone rightly posted earlier today, this is a fundamental shift of a company from an O & G producer into a grower and seller of CBD products and this share price and its decline reflects that.
In march 2017 when we were looking to drill ED our share price was 25p and we had 67M shares in issue, we are now at almost 150M shares in issue and under 7p with just enough income to keep the lights on and even this is soon to run out with only our CBD aspirations to replace it. I will let others figure out how much dilution that is without any meaningful progress.
RP alludes to sales with the number of stores we are in and websites with online and offline sales with no numbers of sales mentioned anywhere, only "expressions of interest" it is simply guff and means nothing tangible. such as buzz words he likes to use such as "vertically integrated".
To still blindly believe we are turning a corner and will be this huge success and the share price will recover at this point is beyond optimism and venturing into the territory of delusion.
OSG must be neck deep with these shares to be so blindly positive. He mentioned ‘facts’ in a previous post but none of the facts put money in the bank. Sure we have 2 websites and with leafyquick and ox distribution and stores but that means nothing if the sales are mediocre. seeds? How many have we sold exactly?
Here’s a fact for you, most LTH came
Here when it was an O&G company primarily. Now it’s more of an agricultural company growing hemp. In the past 3 years not only has the share price dropped massively but we have diluted in shares as well compounding that fact. With little revenue coming in and only jam
Tomorrow statement once again you’ve have to ask yourself, if they promised and failed with all the their projects, why should we expect things to change?
Massive market, tipping point, lots of interest I could go on with positive things RP has said about previous projects.
I don't think its fair to say there is lots of de-rampers. We are simply discussing the facts and looking at the companies past track record. Nobody is denying what the potential income could be if they grow all those crops and retail them all and then sell them all. The issue is, for me at least, is that i don't believe there will be enough demand to sell even close to the numbers needed for this to be profitable as the market is saturated now and in this market HNR are nobody. OSG you are hanging on to every word of RP who always tells us of jam tomorrow but there are no sales figures for this new venture and from what information we have there is only 36 stores half of which are essentially off-licenses/convenience stores and a twitter account with hardly anything noteworthy and finally a company called leafyquick who has maybe 1-3 product reviews for a couple of products each which read like paid for reviews, and look at all the other brands they stock. This is the equivalent of me having a couple of market stalls at the weekend in a couple of cities and telling everyone 'we are now launching pop up shops in several large cities across the county'.
the glaring question for me as previously mentioned, if this is such a sure thing and such a money maker, why did district 8 sell it to us and work for us?
Apologies, Nitrogen, its been a long day.
I know there is a lot of bashing going on but the RNS is there for all to see, all other projects are producing nothing and have gone nowhere. the only one that has is ED which we are not in charge of. Ive felt the wheels have been coming off for a while ever since we bought out District 8 as it left that nagging question that cant be answered. Why did a team that we have took on because of all their knowhow and experience in this field for which HNR BOD and management have none, not take on this amazingly profitable venture themselves after we offered to sell them our hydrogen? the only logical answer is because its simply not financially viable on this scale.
sure we can post napkin math of the crop and seeds and acerages but unless we sell it, its just as valuable as weeds. realistically hemp and seeds wont go anywhere to large wholesalers because anyone needing quantities large enough for us to shift ours, are probably in a position to grow their own. but rather than guess how much we actually grow and sell which could be withfull thinking. lets just assume we grow all that crop, our only source of revenue from it relies on us retailing it and we have a total of 36 stores, 18 of which are convenience stores so it will most likely be a small little section behind the counter. and we are supposed to believe doing this is going to bring in a fantastical revenue stream? how much do you think each store will have to sell for us to not only cover our overheads, but provide capital for progressing one of our other projects or starting a new venture or god forbid, actually returning some shareholder value?
DTU is dead in the water. Hydrogen, apart from the $8000 dollars worth we sold to a company we ended up buying how much more have we sold? water treatment, do we have anything to show for that? Our only source of revenue is ED and thats not going to cover costs for this financial year so all our eggs are in 1 basket, and this one has a hole in it in the form of overheads. Quite why a company that has a need for so few staff has overheads so high is beyond me. As for the BOD, what do they bring to the table now all prior projects are either done with or on hold? we brought on board District 8 management to cover that knowledge gap and at a high cost.
reading between the lines from this RNS, things are going well with CBD but we've all heard that before. There is no actual information relating to sales of CBD products only a website online which a teenager could do and a few shops will stock it. Hoping to pull the wool over peoples eyes with buzz words like vertical integration, but with no numbers to talk about and listing on OTC for new investors it already screams that they know they will need more money so opening it up for more potential investors.
value* sorry it cut off there. I should also point out that i disagree with the incentive packagae as it stands, giving them over 12M shares 12 months from now isnt an incentive, to me, thats just whatever the share price is then you get more free shares to offload. I would have prefered to have seen it linked to performance so at least it shows both a regard for shareholders wanting value as well as a real performance insentive and reasurance that this is workable to the figures they themselves provided in the RNS. i.e 12M shares to them 12 months from now on the condition of certain revenue targets for example. that would at least give us something. but 12M as incentive without any conditions is simply a blank cheque and allowing them a free ride from the success of our other projects as well for nothing.
hi HD, that does make sense and as you righly say we are essentially getting free gas almost to produce 30% free yeild so even if we sold the typical amount at cost thats still 30% net profit over competitors. I did already know about the hemp issue but have read conflicting reports about transporting it over state lines but i believe thats more to do with THC levels. whats the additional merits to organic over non organic or is it more a price point and profitability?
the staff incentivisation part though which gives them shares in effect across all our areas though i dont like which is why i felt they were essentially getting something for nothing if they were already sat on a duck and offloading it to us.
despite past history i think im just a bit more cautious this time around as im hesitant to say this is a good move and a good direction for the company purely on the fact of what we specialise in. if you look on our board its full of experts and experienced people around the oil and gas sector even to RP himself. so we are moving into something we have no experience of and are asking a company which for whatever reason we can only speculate is no longer in business as a grower themselves even if your point has a good chance of being true. so you have to ask if this just the blind leading the blind?
one thing i can not argue with however is that this move regardless of the area its in which is agricultural. it does fit our core company strategy if the figures add up, which it to create a steady continual revenue source and when you look at land purchase costs and permits for drilling and the start up costs the up front costs for this are relatively minimal. however, make no mistake , as righlty pointed out and emphasised by noodle, with the warrants and shares they will be getting from this the cost to shareholders in dilution makes this more than just a $1.5M cost to us. the only question to that end, is whether or not the income this provides over the next year and following years to us represents more than the cost and dilution to us.
i normally do not engage with people and am more of a backseat lurker to here but after the deal with true and the money received from that now gone and so are reliant on that asset to cover costs rather than provide financing to explore other revenue sources such as this, i am more critical of what the money is going on when they come asking for more. i can honestly say i want this to be as good as it looks though and the figures to work out great for us. but if theres 1 thing i want more from this, and its not the possibility of a dividend. its simply to see us start not just covering our overheads but also generating real income beyond this to push other potential revenue streams and ultimately funding for a few riskier plays without tapping up the shareholders. As its only when we start getting more cash than to cover overheads that we can actually start getting shareholder va
apologies for the nagitivity im just hoping i can have some different perspectives on what we have here, i can see the numbers in the RNS and it looks good i just cant wrap my head around why another company would simply sell us a golden goose and not keep it for theselves.
HD i agree with you its all there to see with the yields and figures so we arnt prospecting or relying on geology or permits.
my main concern just down to the amount of players in the game (just look at licenses awarded in colorado compared to most other states in the U.S) with regards to market share for selling our products. lets assume we can produce it in these quantites it only becomes revenue if we can actually sell all of it, be that to wholesalers or retail to consumers ourselves. Is that realistic? and if this is so profitable, why has a company all but stopped producing anything and allowed us to essensially take over and take all the profit and only provide them with a salary on land which has enough room to produce 6 figure sums of plants down the road. something just doesnt add up to me.
a possible scenario is that the company (District8) got this land, built this facility and set it all up and used all their knowlege to grow the product and take advantage of the boom of relaxed cultivation laws. only to find with other competitors jumping into the market making margins even tighter they found they were either not able to shift all their harvest each time (which would be why they didnt expand their own project) or in a race to the bottom with competitors their margins became increasingly small. then along we come with a solution that we want to trial to test it that can increase their yeild (essentially free crop) which proved successful but rather than be willing to purchase the gas in any form of deal as there experience so far leads them to believe the writtings on the wall they convince our board into taking over the whole operstion themselves and are willing to come on board with their experience to develop the brand and simply put, blow smoke up our a ss to offload this now huge building and all its liabilities onto us and for a nice payday to boot in management fees and incentive package.
simply put, if this is so good and the numbers stack up to such easy money, why the hell hasnt disctict8 already expanded with the profit it should have been itself generating to more acrage to grown and why are they willing to give up the profits for a salary instead?
for arguments sake lets assume this is profitable and the numbers add up to us being profitable this year, when the deminishing returns kick in on our ED project (new wells depending) is this just going to be another revenue source to keep the lights on and pay their wages rather than provide any semblance of income to shareholders?
and my last few questions, if we can make this profitable by year end and we have the finances to cover overheads already into next year, why didnt we use those funds to pay for it and take the return back to cover overheads, therby negating the need for the placement? lastly, if things are so great with our projects as RP has lead us to believe many times, why have we not seen any BOD purchasing HNR shares themselves?
thanks for the feedback, as stated im in 2 minds at the moment as you really could make an argument for this both ways. this project for me will either be the feather in HNRs cap or the nail in its coffin. They do seem to have jumped from project to project since getting that money from true in the deal. waste water? we set up waste treatment, nitrogen to make DTU more financially viable (understandable) we get nitrogen. its commercial grade? we will sell it commercially then, oh its good on those crops? we will get into crops then. we have ventured quite far from our core of oil and gas projects into essentially cultivating canabis. and it shows. people who have been here a long time are all too aware of what the BOD can do with $1M when its in their area of expertise, but when its not it means more costly mistakes or more expense on getting that expertise before you have any semblance of revenue. With all this rainbow chasing this past year we have just bled money without any additional revenue stream which is only now becoming evident as they come cap in hand for more funds (and with the 17.5M shares to the new management team over the next 12 months, more diluition as well). I feel as though the tone of my message is quite negative but i do think if this is viable a placing at this price is a steal. but i also have to keep in mind not what the year going forward may bring, but also what they have brought us in the past year as well and they had far more money to progress projects than we do now. it is important to note also however we arnt prospecting for oil here, we know we can grow the crops, we know what they can sell for, we know what we can now produce during a trial phase and we also apparently have the team that can do it. its more a matter of infrastructure, experience and someone who will buy it at the price we can profit from.and if this fails, maybe next year we will try setting up a cotton farm in taszmania. /joke
I have been invested with the company for a few years myself and have overall been happy with the companies direction of creating a revenue stream and less boom or bust projects and was quite happy to have a free carry at 7.5% for ED to that end.
Along with some (especially at the placing price now shown) we are down on this investment so whilst it could be a good time to average down i am also hesitant, as ever since the deal with true oil a while back we havent seen any return of shareholder value, the lump sum from true after the deal was struck and now the income stream from the free 7.5% carry seems to have - and will only be going - so far as to keep the staff paid and the lights on and we have seen nothing in the way of extra revenue to show for that money which is why we are now essentially back at square one looking for a fund raise to be able to advance a project although granted at least now staff overheads are 1 less financial headache to worry about.
after reading the latest rns the numbers sounds promising as well as the financial side of this. 40,000 acres x 12g x $3 with 3 harvests p.a up to 250,000 x 30g at $3 outdoors makes for some mouth watering income but isnt that always the case when convincing shareholders of new prospects? after the true deal if this came along id be excited about it, but since then the BOD from my perspective at least been all talk and no substance, rainbow chasing with how big the market for something is only for nothing to materialise (proejects pending)
i will also quote this from the RNS "...Highlands will enter into an agreement to lease an extensive organic growing facility from a company which has now ceased its cannabis operations. The management team have previously operated that facility," why has the company ceased its operations if it is indeed so lucrative? as we are using the same facility and even the same management team. if it is lucrative does that mean it was a failure in management? if so, why are we a) hiring them again and b) incentivising them to do so?
i personally am on the fence at the moment. if the figures stack up and these numbers do come to fruition it is a no brainer and to steal a phrase from R.P a "game changer" with a 30% increased yeild essentially for free and low costs due to using our own commercialy viable nitrogen the revenue stream is incredible and the ROI of under 1 year makes it a project we can see results, and expand on in quite a short space of time.
in sumarry, im debating whether to average down considerably with this placing for a project which if successful, would make our market cap seem a complete joke. or let it pass by, see what the lay of the land is with this project 6 months from now and if we are any closer to seeing not just a revenue stream but a sustainable and viable project that can deliver the sort of numbers outlined in the rns or is it just another rainbow.
whats everyones take on the substance of the RNS?