RE: RNS - Ouch 21% Discount on placing16 Dec 2025 08:50
Another day, another AIM dilution special. £1.25m raised sounds fine until you look at the detail – nearly 700 million new shares dumped at 0.18p, a chunky 22% discount to the previous close. That’s a massive slap to existing holders and tells you all you need to know about the leverage the company had going into this.
Talk of “strong demand” is standard RNS fluff. If demand was that strong, they wouldn’t need to print stock at a deep discount and balloon the share count like this. Nearly three-quarters of a billion new shares for just £1.25m is pretty brutal dilution for very early-stage assets that still don’t generate a penny.
Use of funds is also vague and spread thinly – a bit for Gorge, a bit for Juno drilling sometime in 2026, a bit for Namibia farm-out “opportunities” and the usual working capital line. In reality, this looks like another raise just to keep the lights on and kick the can down the road.
They keep talking up rock chips, nuggets and “encouraging signals”, but we’ve heard that story plenty of times on AIM. Until there’s something concrete from drilling and cash flow, it’s all hope and headlines funded by shareholders.
End result: heavily diluted holders, more paper in issue, and still no guarantee this won’t be back at the market again in 6–9 months. Feels like a trader’s stock at best, not one for long-term investors unless you’re happy being diluted repeatedly while management talks up the next “exciting phase”.