Member Info for wasarunner

Hi leathatl I think lots going on. I know we are on a mission to be building a mine after the rainy season (I don't know exactly when that is but spring) so working back from that date a lot to get into place. My guesstimate is we will get some newsflow starting in December. Not worried. I think a lot is being sorted behind the scenes and we find out in due course.

TotalTrader - it's a really good question and one I think the company will answer in due course. My strategy is not to read anything (literally) into the size of the first pour. It was done to meet a requirement while the plant was being commissioned. Other than that it's guesswork but we have been told (I can't remember if this was publicly stated but definitely a conversation with Emma) that they are still very much looking at the nearby facility as an additional resource so the licence to use that is still being pursued.

I'm happy because AIMS are happy and they know more than us, that's for sure.

forgot the most important one
- FCF! The clue is in the first word 'free'. Because the company has virtually 0 debt. Very rare IMO. That means as soon as we're producing, the cash is technically ours (shareholders). This alone makes it a compelling investment.

sirspread 73 posts in a share you are not invested in? Interesting. Thanks also for educating us on being better investors it is advice very gratefully received. My portfolio hasn't done that well this year (that's actually a fact) so I can do with learning, as can we all. So just a brief reminder why this is a stock to be invested in:
- $88m ebitda at full production
- gold prices likely to be rising (anyone looked at germany interest rate vs inflation or UK interest rate vs inflation graphs lately?)
- producer not explorer
Will the sp be 8p or 18p next week? Who cares really. This is 5x on a 2-3 year view and that's where the jam is. If it drops to 8p I'll add. I added 1m shares on the pour RNS day, not because I thought it was the bottom, but because I felt the share was substantially derisked. Yet I know the sp will probably only appreciate on steady state news. All good here - this is going north next year. In the meantime patience is all that's required (something dj needs more of IMHO).

you calling Kabunga an idiot :)

all_shook_up that's true - the market likes certainty and that's why I too think we won't be valued at steady state figures just yet for a while. For example, if you're an institutional investor right now, you're sitting ont he sidelines going 'I need to see a big pour' and then you will invest. But you accept you will pay more for investing at that point. Us PI's, we're nimble, we buy ahead of certainty, some people here year(s) ago, some people before the first pour, and that's where the real jam is, buying an explorer and seeing it becoming a producer. I got in late but very happy with my investment. On both this and a couple of others buying just at the turning point of production (or financing) is the sweet spot for maximum reward vs minimum risk.

This is now minimum risk. The reward, the upside, is what we will find out in the months to come.

It's 10% of steady state production (if you were to assume that's a months production). Roughly 10% of 1/12 of 50k/oz a year. I know it almost certainly isn't, because it's a dummy run during commissioning.
I expect the market to wake up when we have ramped to steady state. The market should forward price news but it doesn't and that's what creates our buying opportunity! We also don't have a firm indication yet of when steady state can be achieved given the mining restart just now etc. But it's all noise in the long run, just a few months more patience will be very well rewarded.

Actually if there was a 10% total cap that kind of works. We had ~1.5bn shares in issue prior to Feb raise so a 10% cap would be 150m options prior. We will have ~3.8bn shares in issue post finance so a 10% cap would be 380m total options a delta of around 230-280m options depending on what is actually outstanding. That's under the 8% in the RNS but it works. I always wondered if 28m share options would be incentive enough for JM to do his thing but I guess he can take say another 50m or so now then that's a different ballpark entirely. It will be very interesting how this gets distributed and at what price. I'm with Bwana it is good to incentivise management teams but they should be goals driven. Less of a reward for achieving financing more of a reward for getting the mine to production. The option should be for what's to come not for what's already happened.

Yes and no debt. Or rather, an amount of debt that 50% of one month production figures would cover. That's pretty rare IMO.
Looking forward to steady state production. Selling now is madness but the market is mad so sellers we will have. No debt and production will catalyse growth because all that FCF can be put to good use expanding the mining. And there should be plenty of FCF particularly if gold rises next year as I expect. GLA

Up to 8% of enlarged capital is 300m shares (give or take). That's a lot of options. I wonder what the price will be set at? It should incentivise growth - i.e. it should not (IMHO) be set at 7p or below. Are there any restrictions on how many options in total can be in existence at any time - like a 10% total cap? I forget the historic numbers but I think 100-150m ballpark options outstanding going into financing.

yeah so far I've resisted selling one share in loss to buy another as undervalued but it is a relative value game at the end of the day. Personally happy with the risk/reward profile of my portfolio but there comes a point where a share like Armadale drops to a number where many more multiples are likely than other shares what do you do? Buy it of course. That's how I got to 9m anyway. GLA

Yes agree, that is my favoured outcome too because I think we get a good return without having to wait more years years years with however Horizonte would finance Vermelho. I think the sweet spot for selling is having a clear pathway to A2 construction because a major will buy that lock stock. Therefore I was very encouraged that A2 will be progressed during build of A1 (I imagine to a detailed feasibility level at least). So they can sell the mine with 1 working mine and 2 completed studies for Vermelho and A2. Hoping 30p+ but if we get less so be it.

Yes leathal around 9m shares and hoping to hold all (or worst case, most) to 2023 and beyond. I may need some cash off the table 2022/23 and hoping not to have to sell any Armadale but in any case would run the majority of my position past production. The problem is the classic one - when you need to access cash (I expect to need to in next 1-2 years) you really need all your stocks not to be on their knees. I can't say my portfolio is finishing strongly in 2021, it probably had a higher closing balance in 2020 and I've put a shedload fresh funds in this year! I'm sure I'm not alone, last few months have been a bit of a s***show to be fair on the old AIM. GLA

picked - interestingly I think with the expanded equity a cheap(ish) T/O becomes less likely. I actually don't think Orion and La Mancha would take 15p, perhaps 20p+ they would take. That probably makes a near term T/O unlikely, as someone would have to stump up close on £800m and not sure they would do that at this stage of the mine build.

For me, the structure of the equity meant T/O just got kicked down the road firmly into the 'mine is built' timeline. At that point someone may come in with £800m because we'd be worth that, plus something for Vermelho. I think the 20p is intact here as a result - I think Orion et al will want treble their money back....so us PIs can hang on for the same, albeit on elongated timescales vs what I was thinking.

Strummer I think there are a few long term investors (I see a few on twitter) who buy when the price drops so it has support in that sense. I don't know what size etc. and to date Kabunga always managed to out-sell the buyers. News before Christmas (surely) hopefully the catalyst for better things to come. We're now at or below last placing price (which was at market) which was before the licence award! Madness... if only had funds to capitalise.

Yes sorry. Always get confused as we approach year boundary!

I would set your first review for finance complete. We should be building a mine after the wet season so finance should be agreed. I dont know exact timeframes but next 3-6 months should be transformational here. Then consider best case we are mining early 2022 that could be 13+ months away. As an investment timeframe it is pretty rapid really and we will not be £25m mcap at production.

Sj anything under 5p us bargain basement anything under 7-8p is still excellent value. £25m mcap v blackrock £100m+ mcap similar projects.

Sj, it has bee n a bonus to be able to buy size, sometimes I managed £100k. You normally wouldn't be able to get that much on a share like this so Kabunga has helped people who want to build a position. My other holding I struggle to buy any size. Be aware though liquidity is limited at the moment on the other side too don't be trying to sell £100k here in a hurry. This is a hold to production or at least to the fantastic financing terms Matt will get for us!

Like Bwana I consider this a faster more near term opportunity and started shifting funds around feb/march. Happy with my position but if I come into fresh cash this is the one I would add now. It is the most undervalued on relative basis of the stocks I am interested in, anyway.

pickedp you're not excellance on the other board? They posted added 500k a few minutes after you did...