Member Info for richam

Devon,

currently shipments to GTP during Q3 account for 368 tonnes including the last one arriving 17/09/2018 (38.875,5kg). At least this is what I gathered from public sources.

I'd love to learn how you arrived at 440t? And why would it be 500+ for the first time? Q2 was 584 tonnes and Q4 was 583 tonnes (GTP deliveries data as collected by US customs and published by Panjiva as well as others).

All shipments during the last 6 weeks were for 2 containers only. No matter how hard I "keep watching", shipments keep lagging. I expect a further 4 shipments before the end of the quarter. Should these continue to be 2 container shipments, we would end up at around 524t for the quarter.

Gents, life's not a picnic. As I understand it, this is an investor forum, not a cheerleader forum. I report numbers as they are being published. I certainly won't make up better numbers to please the feel-good gang. I expect revenues to decline vs. the preceding quarter due to roughly similar tonnage but lower prices and that doesn't bode well for the October deadline IMO.

Ophidian,

some postings make me believe their respective posters look at this operation from an industry perspective rather than an investment perspective. "Keep watching" is what shareholders are doing for years already. It's always the next few months that are supposted to bring a breakthrough but it never happened. The consequence is we're losing money all the time. Almost 3 years after handover the plant's output is barely 50% of what it is supposed to be and Wolf keep amassing losses. The debt load is TWICE of what it is supposed to be already. Not much of a breakthrough from my point of view! From Wolf's latest press release it is very clear: TIME IS RUNNING OUT! There won't be a 4th year to mess around with the plant. Once the debt is being "restructured" shareholders are likely to be ousted and their losses to be made permanent. I think it is time to come to an agreement with regard to what we define as a "success".

Assuming the operation could become operational cash flow positive and continue as a going concern after existing shareholders have been given the boot, would you deem this a success?

No doubt, all this has contributed to the misery. However, it has been ironed out and corrected and still the plant doesn't perform. The pivotal problem IMO is the fundamental misconception of the plant. 3 years after handover and with additional investments of around GBP 70M since production start, it barely produces half of what it was inteded to produce 6-12 months after commissioning.

If planned output was achieved Wolf would be making money. Due to the devaluation of the British Pound Wolf should even be making LOTS of money right now. That, however, is just theory. The reality is shareholders (other than RCF) will most likely be ousted and incur hefty losses. Hindsight is 20/20 but from an investor's point of view it is clear: The first new metal mine in the UK for half a century is a full-blown debacle and should not have been built in the first place.

Devon, I'm afraid the rate is declining again. The latest shipment is a single container carrying 19,4 tonnes only. What's it this time? Lack of processing water, drought? http://www.bearsbythesea.co.uk/wxraindetail.php

Thanks, Gentlemen, what a fruitful discussion! These are the best postings I have seen here, ever. Thanks again!

Blitz, what is your assessment on mine life based on current reserves in case ore sorting is added to the processing on a permanent basis?

Devon, tonnes shipped during July sum up to 116,3kt and tonnes received in Newark sum up to 209,5kt. The trailing 4 weeks average weekly shipment is for 58.545 tonnes.

"Its remarkable how Wolf reduced their Senior Debt from £75 mil to £63 mil within 4 years with all the problems they've had."

Yeah. They spent cash to reduce debt at an interest rate of LIBOR +4,75% and now increase debt at an interest rate of 15% to have cash. A truly brilliant achievement!

"The bridgling loan etc is not senior debt or don't you know the difference?" Yeah, the difference is the interest is now 15%, genious. LMAO

"So, total debt is senior debt of £63m, plus bridging loan of £65m, plus unpaid arrangement fees and unpaid interest."

In fact it's GBP 63M, plus Bond Facility of GBP 5M, plus "bridging" loan of now GBP 69M, plus fees and interest.

Interest rates are LIBOR +4,25% for the senior debt, LIBOR +2,75% for the Bond Facility, and 15,0% for the bridging loan.

"£65 million [recently extended to 69 million] subordinated loan facility with Resource Capital Fund VI L.P. (“RCF VI”) as announced on 30 June 2018. The applicable interest rate is 15%."

If you want to get an idea of what CAN happen to a project like Drakelands where a majority shareholder continues to pour tens of millions into a money-bleeding operation, have a look at Atlantic Ltd. who once operated Windimurra. Atlantic's last stock exchange notation was ca. 20c before it was halted forever. The majority shareholder ousted all others by paying 0,3c for each share they owned.

At the end of the day it doesn't matter what the money will be used for. What's important is if it happens as anticipated, the company will run out of funds sooner rather than later, yet again. Even if RCF was to continue to throw good money after bad, at some point there will be a debt to equity swap and that's what shareholders other than RCF should be really concerned about.

Southwesterner, there were 4 shipments to GTP that arrived in New York during July with a 5th shipment expected to arrive today. The average shipment size was for 52.380t or roughly 3405 MTU. Assuming Wolf was able to increase this to 60.000t per week, it would result in deliveries of ca. 50.600 MTU per quarter to GTP. The recent distribution between GTP and WBH was roughly 9/1 so adding another 10% results in quarterly shipments of 56.200 MTU. That's 53% of our agreed 24/7 nameplate capacity of 425.000MTUpa. As we knew all along, 53% of nameplate output 3 years after hand-over can by no means be self-sustainable. Hemerdon must be labeled "commercial failure".

It would take at least 4 rather large shipments to explain the gap! Sn grade mined during Q4 was 0,03 whereas it was 0,04 during Q2.

Excellent point re improving quality! With regard to stockpiling... why on earth should they do that?
1. Prices are in striking distance to their 4 year high.
2. The company desperately needs cash
3. GTP deliveries increased significantly

The only conclusion one can draw is the companys does not stockpile any product.

BTW, Q2 deliveries to GTP alone amount to AUD13,7M. Even with zero revenues from WBH and zero revenues for tin, there is money missing!

Devon, I think it has become perfectly clear who has all reasonable arguments on his side. And there is a perfect explanation as to why Wolf was (and still is) unable to lift output (and therefor "recognized" numbers, LOL!) as one would expect when crushers, screens, etc. run 27% longer. As I had explained time and time again, the backend of the plant (the part that actually produces W concentrate) was running on a 24/7 basis already. It just sourced its input from the frontend for 5,5 days per week and from stockpiles during the other 1,5 days. So basically W production was "on" 24/7 way before year end thus output did not make a leap forward as one would expect when all machinery runs 27% longer than before..

Let's compare Q4-2017 vs. Q2-2018 and you'll see what I mean.

Q4-2017: Production 43.498 MTU in concentrate, average APT price USD288, -> W revenues ca. USD10,0M. (20% discount concentrate vs. APT)
Q4-2017: Production 125t tin in concentrate, average tin price USD19.900, -> Sn revenues ca. USD2,0M (20% discount concentrate vs. metal)
-> overall revenues = ca. USD12,0M. Average AUD/USD rate = 0,77. -> overall revenues = ca. AUD15,6M.

Actual receipts from customers as reported in the quarterly: AUD15,8M. Perfect!

Q2-2018: Production 42.314 MTU in concentrate, average APT price USD337, -> W revenues ca. USD11,4M (20% discount concentrate vs. APT)
A2-2018: Production 70t tin in concentrate, average tin price USD21.000, -> Sn revenues ca. USD1,2M (20% sicount concentrate vs. metal)
-> overall revenues = ca. USD12,6M. Average AUD/USD rate = 0,76. -> overall revenues = ca. AUD16,6M.

Actual receipts from customers as reported in the quarterly: AUD 12,7M. WHAT???

Are you kidding me? Almost A$4M are missing! This discrepancy is mind-boggling but left completely unexplained. I am perfectly sure shareholders deserve an explanation for A$4M missing! Did customers stop paying Wolf? Did Wolf deliver terrible quality that triggered mega-hefty penalties?

Why is tin production down 44% when throughput is up 14% and Sn grade is up, too?

There are more questions like these because the numbers just don't add up. I'll leave it there for now though.

Two other things became absolutely clear:
1. Deliveries to WBH DECLINED FURTHER as opposed to what the persistent board liar said.
2. The same liar told us Wolf didn't need further financing. In the quarterly report you'll find

"The Company is aiming to conclude the first stage of these [further funding] discussions and reach agreement shortly, in order that the first tranche of further funding (circa £2 million) IS RECEIVED BY THE END OF JULY, which is NECESSARY TO ensure that the Company has sufficient working capital to meet its short-term requirements to CONTINUE AS A GOING CONERN."

You are the one who's making things up, i.e. pretend the expansion to 24/7 had not taken place. Devon has all the facts in his favor.

That's EXACTLY what I do anyway, my Dear!

Goldhanger, could you clarify of what nature your relattion to Wolf is?

Well, I have a hunch this explains the stock's recent under performance. If you run machines like crusher, screens, a kiln, etc. 24/7 instead of 5,5/7 and don't increase output targets, that's quite telling, isn't it? "Official" numbers can never override common sense.

I don't think so. Goldhanger's posts are way too intelligent for anyone of the Stooges.