Member Info for wasarunner

SJ and others of course it isn't a straight line by any means. I thought we would get 10p post financing, at a stretch 15p. Extra dilution I didn't expect meant we didn't in fact we fell to 6p. But you do have to evaluate and re-evaluate your holdings in the context of new information - for me - that new information is the number of shares available. I took it as a given Horizonte would raise enough money to build A1 (I didn't realise they needed $630m though). It does look like they are a portion into funding A2 picking up some expensive parts on the cheap which is a huge bonus and probably under appreciated in the context that the main finance package was center stage.

You have to have a goal, at least, I do. I am trying to work out what this stock will be worth with realistic assumptions based on time I have available. I have a lot of time available, others have less. We have to make assumptions - I don't know the nickel price in 2028 but Woodmac and the current climate suggests it will be good (underinvestment in nickel development and Russia situation help as does demand drivers).

It is fundamental to me what this stock will be worth. I'm not really here for 'if it goes up a bit in a number of years'. I am trying to work out how much it can go up and by what time. I am reasonably comfortable that if Horizonte can deliver A1+A2 online without any (and it may be possible to do this with some, but minimal) dilution at A2 stage, we will be worth 30p at least. That's $1.5bn mcap ish but the NPV at that stage should be very well north of $2bn maybe $3bn we don't know because we don't know the nicekl price. Then it becomes interesting to see if we hit 50p because that is a significant upside from 30p. Can we hit it? I think we can particularly if something happens with Vermelho. Another route for Horizonte is to sell Vermelho after DFS and plough the proceeds into further developing Araguaia South, Araguaia North, Serra Tapa and any other 'ferro' resources they have. Become a pureplay ferronickel producer. Sale of Vermelho might yield enough to build a whole new mine. Lots of permutations. Of course Glencore might buy us how much will they pay at least 30p hopefully.

If you invest on multi year view you have to have a goal I don't believe any investor just puts their money on the table and waits for something to happen. My goal is A2 producing and 30p/50p. Timeframe? Anytime 2026-2032 suits and I don't think it necessarily even needs to take that long. GLA

Low p/e usually means high yield is possible. That is attractive to investors too. I am not counting we get far enough for divis here but if we do....

Don't know about other peoples averages but my ringfenced 10m average must be around 2.5p. 50p is a 20 bagger. Worth waiting even 10 years from when I bought them I reckon ie 2028-2030. £5m a good return on £250k invested. Gla

$30k/t gives us 4.6x p/e which apparently may be more realistic. Somewhere in the middle ($25k/t for 7x p/e) might also work in a strong nickel market. So several ways we can get to 50p. 50p remains my stretch target happy with 30p at A2 producing. GLA

Not really big volume and market sentiment is generally weak at the moment but I don't have funds to take advantage. Yes CEO said gold pours monthly but she also did say they might not announce every month - however - I hope they announce first decent pour as it should stabilise sentiment here. They kind of owe us that I feel after a few false dawns and missed targets - if there is good news - update the market with it.

I make the average monthly pour to hit the 18.5k min guidance target (factoring the 1717 ounces already poured) 1864oz/mth if monthly pours. Would we expect that in April - probably not as they have suggested recoveries are expected to improve during the year. However, you would be hoping for a decent % of that number to steady nerves that we are on track. Say somewhere in the region of 1-1.5koz min pour in April would be nice.

OK I've been informed by another on another forum maybe 10x p/e is ambitious and also based on the effective CT rate of 29%. I've reversed my calculation and figured what p/e would we get to if we had 21kt production from Vermelho (either a scaled down mine that Horizonte builds - effectively 1.5x RKEF lines like Araguaia) or as part of a 35% JV with a partner who can build a 60kt mine.

50k/t gets us $500m EBITDA so we call that £357m GBP or £218m GBP earnings after tax. You get 9.2x p/e but you need 21kt from Vermelho.

Of course still lots of upside from higher nickel prices et al but it is still a good illustration that 50p is not pie in the sky though it does need time to develop these resources to this level and other external factors (ability to finance without dilution, solid nickel price) to play ball. But if you've got time and if these things play out nicely 50p is 6.4x of todays shareprice so not quite '10 bagger' territory but not a long way off for a few years wait. All IMHO.

Thanks OilyRags. I knew 15% seemed too low!

Sorry $330m USD that should be obviously exchange rates will vary quite a lot over time. That would mean 33kt production Araguaia nameplate for the two lines is 29kt. So it nearly works and obviously with the approximations and the fact that sale price can be higher, p/e can overshoot it seems to bring 50p within reach certainly not a pipedream number. Funding options for A2 are critical in that calculation and also recognising that this will take a good while to achieve (but I got time with my ringfenced holding so no rush for me I can't touch sipp till 2032 earliest). GLA

Been trying to figure out what needs to happen for 50p based on my 'ringfenced' holding call that 10m shares I like the ring of 50p. The shares in issue it's a big ask potentially but here goes my calculation. I have kept some numbers approximate to simplify it.

I want 10x p/e and I think LOM on A and V supports that in steady state. I assume 4bn shares. I therefore need mcap £2bn gbp net earnings £200m GBP. CT is 15% (seems low?) I need PBT £235m. I call that $340m USD assuming exchange rate of 1.4x.

I assume $10k/t gross profit (i.e. $20k/t sale price $10k/t cost of production) and I ignore royalties etc. Then the above can be managed almost from A1 & A2 we actually don't need Vermelho. I thought we needed Vermelho when I started the calc. I also ignore debt payback interest etc.

So steady state Araguaia alone may be able to lend a 50p valuation. I assume no more shares are issued so funding of A2 has to be from free cash and debt.

What did I get wrong? Because if nothing then there is actually quite a lot more upside to come. Is p/e 10x too optimistic - wouldn't have thought so in a mature market for stainless steel and a 28 year mine life for Araguaia? I still think we get sold earlier but 50p is a nice target if Araguaia2 can get to production and we do something with Vermelho.

China is affecting overall market sentiment. That and threat of US interest rate rises. I'm not sure how coupled Horizonte is yet to global macro events but certainly the closer we get to production the more it will be.

Could be - but more significantly ii's can buy more shares than people are selling which pushes the price up. I know this 131m position is a synthetic one (I don't really understand CFDs) but if someone wants 131m shares they are going to buy up a lot of sells and eventually move the price up.

If even a small % of Glencore's institutional investors take a position directly in Horizonte we could be on for good gains because they simply buy more shares than people want to sell. That moves the price one way. Then when the nature of the buyer is disclosed it can have an even bigger effect. Imagine a TR1 where Anglo American have taken 131m shares :)

Amtech not disagreeing with you at all everything you say makes sense. But directors especially good ones (I have worked with some) also know that timing is everything and to unlock real value sometimes just takes time. Is MB one of those guys, I don't know him personally but while the macro picture improves and the company makes progress (albeit visibly slower than people like) we are moving in the right direction. Warrants are being cashed, mine director is appointed, negotiation with govt for tax is underway, and, probably a whole list of things we suspect are gping on but are under nda.

Across my other investments I sense a lot of frustration from people who didn't see covid coming (nobody did) but ot actually caused a leadership change in Tanzania. It pushed my main holding back 3 years. I get people have imvested here for many years and indeed the sp has been in this 4p area a long time, my first buy may have been above this price.

News will come and it is worth waiting for. In the meantime I keep buying with ehat money comes. Two buys today are mine. Gla

Partner announcement on V (lets face it it will be a big partner who can fund a $650-$1.2bn+ capex project going) would be really good and almost certainly an immediate rerate. Is it likely soon? Probably not but because you can never rule it out it is risky to assume nothing happens here till Araguaia gets built. An offer for the whole company can also land anytime. My sp expectations to commissioning Araguaia1 are modest, probably more modest than a lot here but because anything can happen anytime it is best to be in and not out. Who saw the rise from 6-8.5p coming when it did. Maybe another big ii takes an interest and moves us up another leg. I have said for a while now ii's will control the price here and it will be interesting on the 6 monthly holdings update just to see the migration of change of ownership as that happens. For me Horizonte rmains a 'big jam when A2 is producing and Vermelho has a partner' typebof investment for 3-4yr+ timeframe but anything can happen and the Glencore stake building and Helikon tr1 were very positive signs.

Lack of comms: poor, agreed. Lack of comms is not the same as no progress though so the two shouldn't get conflated - there can (and frankly should!) have been lots of progress since ML. Apart from NDA I can think of couple of reasons we may not have had as much news as we wanted which is MB wanted KB out before significant progress and also potentially to improve the deal as he knows with time the deal would improve against the improved macro backdrop for graphite. Speaking only for my position (and 100% understand others have different timelines/goals) I am a. grateful for the opportunity to build a substantial position during orphan period and b. very much hope the finance packages is literally as good as MB can make it, as over many years timeframe that is what generates the best multiples of returns. Pants finance packages are easy, we hope for a good one.

But 100% agree comms has been poor and needs to improve.

In case this isn't obvious - Helikon position is 2/3 of Teck's position prior to kine finance - at the time Teck had 14.5% of Horizonte. This company have put up cash equivalent of 10% of the co in 'old money' which is what Glencore now hold in 'new money'.

So you have to ask yourself why a fund would buy a position in cash terms which is worth 2/3 of what the largest shareholder held then. It could be one of a number of reasons, all of them good:
- Horizonte successfully raised $630m
- Glencore toom a 10% stake
- nickel went to $30k/t
All of these are good reasons to be invested here and the more institutions think so the higher we will go.

Whilst I agree with what SJ says to an extent all rapid rises will be sold by some BUT we are in new territory with respect to funds taking an interest it appears the Glencore transfer and sealing of finance could be the catalyst. I dont know how they do it but this lates tr1 - 131m shareholding. Anyone believing it is anyone but ii's setting price from here on in is mistaken I think. The fortunes wrt sp of this share will mow be driven by newsflow from the co coupled with institutional interest garnered directly through marketing and indirectly through industry players taking positions. 'Pull backs' may nt always happens as news starts flowing.

In all the analysis of course nickel price is going to be crucial. Even the equity price horizonte may do future raise at will be driven, once producing, by the nickel price.

I find it mighty encouraging that we are at around $30k/t now and the real beginning of deficit is mooted for 2025-26 (woodmac). Russian situation and esg will have further ramifications of where buyers will source supply from.

Surely on the first mine you have to over raise - dont have enough cash you hand the whole company over to debt holders - its curtains. On the second mine (or first mine extension) you can run much closer to the wire. Didnt raise enough cash? Wait for your producing mine to produce 6 more months of fcf and complete build 6 months later.

yes that's the thing, someone wants out (my guess still from the £40m misc equity raised) but the selling is quite well matched to buying so someone who presumably sees Glencore's investment here as a signal to buy is buying - and a few PIs aside the volumes suggest there is institutional buying here. Notwisthstanding the fact that it could be Glencore buying as someone pointed out they might not RNS until the next threshold crosses.

Strategically Glen could take another chunk when Vermelho needs to be financed. They can get there in small steps or, given the sheer size of the co, they can take it in one bite if they so wish at some point. Big fish indeed..... have a good Easter everyone certainly interesting developments here in the last few days.

SJ - nice holding and good luck.

I ISA'd ACP (could have done HZM or GRL) mainly because I think the multiples upside on a 24 month view is probably the greatest of the 3 and cap gain is a thing. Plus I will eventually have to sell some at production as I need some cash in a couple of years time and have earmarked a producing ACP as being a worthwhile target (but would hope to run the majority till the expansions, graphite deficit and real jam in years to come).

Think graphite will do a lithium. Here an opaque market is our friend, people just aren't yet seeing the price rises that are going to take place. We just have to remind ourselves too that BKT are 6x of our valuation but that both companies delivering - that gap will close.

Next milestone here - Apr/May warrants cleared. Rainy season ending in Tanzania (next month?) Hopefully we start to see news start to come through from the co. I still have circa £30k funds landing in May I want to put in here then that'll probably have to do. GLA