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So why are vanadium prices down on last year?
Pdub -"significant rise in V price driven by a growing global VRFB market" - gut feeling tells me we are probably a couple of years away from that.
A chance they're going to run out of cash:
The Directors are in the process of evaluating potential additional funding options from potential strategic investors but no such funding is committed as at the date of approval of these financial statements. The Group has been, and continues in, active discussions with a number of potential strategic investors and is confident that it will be able to conclude an equity investment from one or more of such parties within the period up to 31 December 2024 assessed for going concern purposes. The Directors also note that the Company concluded an initial strategic investment from Everbrite Technology Co., Ltd. for £2.5 million in March 2023 which gives them confidence that the Company is capable of attracting further strategic investment.
Due to the uncertainty in relation to obtaining additional funding this indicates the existence of a material uncertainty that may cast significant doubt about the Group's ability to continue as a going concern.
The financial statements do not include the adjustments that would result if the Group were unable to continue as a going concern.
Harchris, much like most of your posts, factually incorrect as usual. You are aware I sold the majority of my holding in mid 20's. It has been stated here several times; you are clearly not capable of research, much like your claims of production costs that you can't substantiate.
Coffeecups
My thoughts for the future:
I believe that production costs are still in excess of selling price (remember that prices have fallen by approx 14% over the last 6 months). Whilst they gained a cash benefit of around $8m due to selling down inventory, this will be eaten up in the current financial year by excess production costs. Where is the cash coming from after then? Another cash raise/dilution? Or sold to the Chinese on the cheap? Personally I think a sale is unlikely, there are too many PIs holding shares that will be unwilling to crystallise losses (after all they tell you only lose money when you sell).
Clearly you can only carry on loss-making for so long, although they do seem to have made a bit of an art of it over the last few years. This will only cease on significant price increases in vanadium. Despite all the claims that demand is/will exceeding supply in the market place, this is not feeding through to pricing. Is this due to a slower uptake of VFRB than anticipated? My take on it is that rise will come at some point, but this may be several years away and be too late for Bushveld. To my mind this is the biggest single factor in the future of Bushveld, and for now the pricing is going the wrong way.
Electrolyte - I see that as a white elephant at present, you would have thought that given it is about to go into live production that some sort of selling contracts would have been announced, we have heard nothing to date.
Mokopane; this has been mothballed having been bought at a cost of $68m. Part of this cost was provided against last year, I suspect the auditors will insist on further provisions going forwards. Although this won't have a cash impact, it will significantly weaken the balance sheet and therefore the ability to raise any required funding.
Just for transparency, I did buy back in a small amount last week hoping for a dead cat bounce. I suspect there may be a rise to 4 or 5p over the next few weeks with the excitement of a new CEO before reality sets in and it drifts down again, a small trading opportunity. (By the way, if operating progress has been so good, why did FM step down? Seems strange!)
Anyway, I'll leave it there. For all those with filter blinkers on (Pdub, Harchris etc), they won't see it anyway and quite frankly I don't care. They only see what they want to see and what makes them feel good. That policy has already cost them a lot of money, I hope it doesn't cost them all of it.
Just giving the lemmings some advice, you know, like facts from financial statements, RNSs etc as they don't seem to understand them, call it a public service.
No problem Knutsford, you keep listening to Harchris & Pdub and see where that gets you (not much further to go now mind you!)
Posts like the below didn't help, (just one example of many)
Pdub
Posted in: BMN
Posts: 13,211
Price: 41.50
No Opinion
RE: IH7 Jan 2019 16:10
IH that's where you got it wrong .... by omission.
The share may go a LONG WAY north. Way way north.
Just like 2017 and 2018. Had the same sceptics in 2017 and 2018, even though the business plan and the numbers suggested strong sp performance. In my opinion we have a similar situation and the business plan and numbers suggest another very strong year. My target is 75p to £1.50. I would not be at all surprised to find that is achieved in 2019 and new target set if company delivers on its promises.
And BMN have a track record of delivering.
Harchris, your version of accounting is not accounting, only this morning you claimed they would recognise $9.25m profit on the 200mt inventory sold!
I have provided production cost calculations, I strongly suggest you provide your own to substantiate your claim, otherwise its just hot air
Harchris, it would be really useful if you could provide your calculation of how you get to your production cost so we can verify it, a bit like I did
No problem, cheers
Faramog, I was merely pointing our Harchris's error in stating that the P&L would benefit by $9.25m, quite a material error you would think.
In fact Harchris, you posted only yesterday that you thought AISC was $35.5, and this specifically excludes finance costs!
Would be good if you could back that assertion up with numbers Harchris, a couple of days ago I posted a higher number that was based on actual numbers pulled from the accounts, not just a figure plucked from the air.
Harchris, while there will be additional cash, there most certainly won't be an additional $9.25m of profit added, this stock would have been carried in the balance sheet at cost so only the profit element will be included; we don't know the exact numbers of course but say it was in the December balance sheet at $36 and sold for $40 then the recognised profit from selling this is sub $1m.
I really wish you would stop trying to mislead the board
Stop trying to mislead people Pdub, selling price has fallen by more than any savings gained from cost reductions, FX etc. Try telling both sides of the story for a change instead of just the bits you want people to hear.
If you're going to tell a story Harchris, tell the whole story, prices are still 13% down on 6 months ago, this is straight from the link you posted. They weren't making money then so what do you think is happening now?
Harchris, do you realise that AISC excludes finance costs, so you can add another $3.5 to that figure of $35.5? Do you think profits are being made at a cost of $39?
Q2 figures will be interesting, given that vanadium prices have been falling
No, the write down provision is excluded from these numbers, please refer to the financials in the RNS for verification. The problem with EBITDA as presented in the accounts is that it ignores finance costs, these are very real!