Member Info for wasarunner

no worries - wasn't a dig by the way people change opinion on a change of circumstance / information. I'm relatively optimistic here but it was a disappointing year last year no doubt about it and I get people's frustration. As I said on another post it's a long game, good luck to all in their investments!

On whether I would buy GRL right now - I have enough so I won't (and no funds) but if the BOD can execute, from this level, there are clear multiples upside. The keyword of course is if. Should find out in the months/year ahead. I've got a few in the 3s, few in the 4s, few in the 5s then a lot of mine were bought 9-10p. Still looking for a return on all of them, happy to wait 1-3yrs+. GLA

I've got a sub 10p average :)

$5.1bn base distribution + $0.5bn top up distribution + $1.5bn buyback programme.

Frankly I'd rather they spent the $7.1bn buying us (I'd be happy with that figure / 330m shares), but our time will come :)

edzi - mid last summer you were downbeat about the management - see below. Interested in what changed for you as you seem more upbeat (despite the management team not really delivering, so far - by all accounts H2 last year was poor). Investors tend to be more downbeat when the company doesn't deliver and the shareprice halves - I'm not saying you're a trader because I don't know, and there might be genuine reasons why you are more upbeat now - which is absolutely fine and I'd love to know what they are - do you know how they plan to use the new money (apart from what's in the in the RNS I don't know any more detail?)

It can come across when someone is downbeat then upbeat that they are selling / buying the share - not saying that's you but it can happen. FWIW apart from a bit of buying and selling at the edges (normally when new money lands or I need some for something else) I hold this stock and have had a consistent holding over 5m shares for well over a year now.

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Waimea
I do fundamentally agree with everything you say, I am an investor here and still in profit but the management has been poor and they have had unlucky breaks. When I first invested I always asked myself why they stopped mining in the early 20th Century at Akroteri if they were finding 24gms a ton. The soil and rock is a problem but they should of researched into Ashantit find out if they were having the same problems as this would be to me the first area to look at. It seems amatuerish

Excuse typos I can't type on my phone.

Jack Hackett - a fair post. But as an engineer myself (IT but nevertheless the principle is similar) and I don't know the history of thr other company you speak of - steady state operation is much easier than going from explorer to producer. In softeare maintaining an operational piece of softeare can be hard, but writing it from scratch line 1 of code (which is what I am doing at the moment) is an order of magnitude harder. Goldstone have done this in a country which afaik doesn't have 'junior' gild miners to production - all the gold mining is done by bigger players (or artisanal probably) - but happy to be corrected.

As you rightly point out also, particularly i gold miners, the market prices for what if. The excitement of the high grade drills, what if at Akrokeri, ehat if at Homase pits 3 and 4. There is obviously an element of chance it is the nature of gold mining it was the same 100 years ago. I guess the point is when it works out you win big.

Could the mgt team have been more transparent/forthcoming with the oprational issues thet experienced earlier than they did? Probably, but as another postef pointed out they are working for the three or 4 institutions invested, us PI's are an afterthought. Probably the former are kept in the loop. It is the chance we take investing in these companies.

If the other company you speak of is transparent, has good metrics and steady stste production with further upsidd then it may well be the better investment. I saw a lot of potential with Goldstone and still do. Unlike others (wss it Buffet eho said this I am not sure) I do see low price as opportunity not always a problem. Two of my big investments are cheap at the moment and I added heavily one of them last week (not goldstone). Time will tell if I'm right.

With this kind of investment, if you are an investor (trader is different) long game is the only way to play it. Have 3 or 4 of these, each one that makes it will return a multiple, the ones that fail will return most likely 0 if you are lucky you get some money back. Picking all winners is hard of course. Lots of things appealed to me about Goldstone when I first invested and many/most are still valid so for me it remains a sound investment. Unfortunate we missed the targets in 2022 which ultimately resulted in the raise, but an opportunity in 2023 to fix that. Gold price is reasonable presently and hopefully also pushes north. We are highly geared to the gold price - any big jump in gold price will affect both top and bottom line here massively. You need to be bullish on gold to invest, obviously (I am). GLA

edzi - I'm in the long game (with all my investments). Year 1 and 2 of this investment haven't gone quite to plan but I like the fact we're producing, we've taken a bit more debt on but I fully expect it to convert (so I count it as dilution rather than a debt overhang - bit like the other debts which have already converted into equity here). But make no mistake this is a critical year for Goldstone. I'm less worried about total production numbers and much more important is the profitability/recovery rate. But the investment is designed to boost their capability of recovering while reducing the cost of recovering so in theory at least we should see improvement in profitability. If you can't get on a self sustaining cashflow basis there will always be dilution - the principals here know this which is why they want to make it profitable. Alongside that we want commercial quantities (not 5koz but 20koz+) so if they can hit both goals then great.

As I said long term investor and I couldn't sell my stake if I tried, I have 6m shares+. So my fortunes are tied up with the fortunes of Bill T et al. GLA

The entity provided a (convertable) loan so didn't buy shares per se. However, they risked £2.4m (which is fundamentally all risked investment) which is convertable at a shareprice which I fully expect them to convert. I am by no means a stock market guru but others tell me that when this kind of event happens, the stock gets marooned at the option price for a while while investors figure out what the value of the company is. It is kind of like a placing. That's normal - so I expect perhaps no progress from the current level until we have news that tell us that diluted mcap is worth rerating from the current level because the gold production figures warrant that.

So some PIs, realising the jam isn't today or in the next 2months or 6 months or whatever their time horizon for investing is, sell, because company X over on the other side of AIM has just announced fab news and is rocketing and they want to buy in high in the hope of seeing it go higher. That's been my experience of AIM in any case.

The example I highlighted in my post earlier is a case where the placing was subsequently proved to be valuable for (eventually) rerating the share as it provided the finance to unlock 'the goods'. At least what the chairman/CEO are telling us here through the RNS is that the purpose of the finance is to expand production and unlock the goods. Assuming they can deliver the goods, therefore the placing is a good thing and the price should rise. Because nobody (currently) believes them - at least not the entities (PIs) who would buy open market, the shareprice stagnates.

Is it a good investment at the current price? Yes, if they deliver anything like 14koz or 20koz profitably. I would say even with the extra dilution 20koz is worth north of 10p if it can be done sustainbale. So that's 2bags from current price if they deliver on plan. Will they do it? Well that's the question and that's the risk you take with your investment. I hold, but not adding for now (that's not a negative I just don't have free funds. If I had, I would consider it). GLA

Why do you say that? Because of a few 100k sells yesterday? It is an illiquid share, always was, so if a PI or two throw in the towel the share price goes down. I prefer the view of the entity who just invested £2.4m at 3.25p, which is also a miner in Ghana. They've just bought, in effect, 70m+ shares worth so for me that carries greater weight than a few PI sells. PIs sell when bored or frustrated. Only worry when we have TR1s from any of the principals invested here showing they are selling....though it is very unlikely they would be able to shift their positions on open market anyway, not till the fortunes of the company have been revived.

I'm eyeing it as an opportunity but prefer to wait at present till we get an update on progress. GLA

Incidentally if both POSCO and Ubrix are involved in the BKT finance deal from the off (I am really hoping they pull this off), that will be two non-Chinese firms (SK, US respectively) who have a Tanzanian business interest in graphite with committed funding. That should be seen in a very positive light by financiers and end users for Armadale because these companies have to work in a very transparent way for their shareholders where for example a Chinese co may not. This should be a gateway deal for Tanzanian graphite and open it up to other customers (e.g. European buyers). GLA

The bits that are key, for me are these:

"Moreover, significantly improved market fundamentals and conditions for graphite has seen an increase in interest from stakeholders capable of providing long-term project finance."

" the Board has commenced re-engaging with prospective end-users which are located in Europe and China."

This echoes what we hear from De Vries at Blackrock - that there is significant building interest in the graphite space from prospective customers. Obviously converting those into actual confirmed finance is the key but the fact that market is open and willing to do business is what sets up the environment to do that and I think a year or two ago it wasn't the same situation.

Oh I see you mean the dilution from the convertables already issued. That's easy. 330m shares fully diluted. So Peel hunt valuation is £660m for now...which might be ok for now but doesn't allocate much to A2 or Vermelho.

Institutions buying now have the full picture of the fully dilutrd mcap vs nav.

Have you posted on the right board? Hzm is financed to production, so much so that the BOD believe line 2 of Araguaia will be built from fcf?

Used to be 14p risked 33p unrisked (so £6.60 in new money) but I guess Covid put paid to that at least in the short term with the financing deals as they landed. £6.60 feels kind of doable (mcap would be £2.2bn) but a way down thr line I feel - personally think we get sold before we get to such a valuation. I would be a very happy chappy if we do eventually see that price of course...

One final final point on the BKT presentation then I'll shut up. It is very professionally put together. Tells me, an investor, everything I would want to know to invest (apart from the $million question of how they will get it financed). I hope in time we can have a really slick presentation like this too for ACP - I know people will jump on this comment here so I'll shutup now :)

All the industry stats are relevant to us too so we could do a lot worse than just lift those pages straight from their presentations assuming we agree them....

One final point from the BKT presentation was they have 20 month mine build and expect to produce CY24. That's very tight now - it means their plan is to finance by end of April latest and be building from May.

Personally expect that could slip but interesting they are still saying that in the February presentation. Obviously think they are very advanced with Posco/Ubrix/Tanz govt. Whatever happens rest of Q1 and Q2 will be very interesting indeed.

Interestingly the blackrock presentation has pretty boring consensus forecast over the period they care about for their basket:

2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
Expert Consensus - 97% conc grade US$/t 1,203* 1,479 1,592 1,721 1,665 1,550 1,542 1,568 1,585 1,611 1,643 1,643

I always take these analyst forecasts with an enormous pinch of salt - we see how wrong the nickel forecast has been (in both directions) at times but in my mind - I can't equate an enormous deficit in 2030 (1.4mt deficit forecast slide 8) with a broadly flat graphite price ($1568/t 2029 v $1585/t 2030).

When you're 1.4 million tonnes short of a key supply chain material - it is my expectation that price will rise (which is why I am invested here, clearly). GLA

Just going through the presentation in detail and this caught my eye:

BKT sensitivity: 10% increase in basket price = 20% increase in unlevered NPV

Wow. That's a highly geared play - it will be the same for Armadale no doubt. And we have to assume with the deficit coming (page 9 of the presentation) that prices will push north in the years ahead - so current basket prices/NPV will be conservative relative to long term future average pricing.

I keep hoping for that glencore tr1 rns - the issue is I think that after the last funding round they were left at an odd threshold - 17.8%. I think this gives them quite abit of purchasing amount before they have to declare - would it be 20%? Prior to the funding round they were sitting at 9.8% so almost any serious buying would have triggered at 10%.

Unless I have it wrong and they have to declare every %. But I have seen institutions buy and sell quite a lot of shares over a protracted period of time and only declare when they deemed to have finished.

Glencore buying up other ii stakes would be a very clear signal of intent imo. Like when they bought Teck's stake.