Originally posted by Wary 1
It's not quite the Quarterly that I was expecting, but it is also not bad either. There is a lot of detail which explains the reasons for the increase in mining volume and lower recovery and cash margins. This will be addressed once mining progresses across to the east side of Floater Road and as a result of the Yield Optimisation Project. I am disappointed though that there is no real news about SdV other than that several offers are still under consideration and negotiations are ongoing. And I wish there was some more news about James Bay, but it is what it is. What I did find interesting is the Industry and Market Update commentary which points to a more buoyant market in 2019 and a stabilisation in Chinese domestic prices for lithium. The information about NEV growth in China and favourable policy positions in other countries highlights the ever increasing Li demand that the supply side will be struggling to meet. I was also interested about the statement that the current state of the Li market presents a firm foundation for price recovery and potential industry consolidation, and wonder if GXY might be one of the companies that could potentially be consolidated either though it taking over some smaller fish or being taken over itself by one of the bigger fish.
My biggest disappointment with Galaxy is their poor communications. Before the Q3 report, no-one knew about the permitting delays associated with Floaters Road and the implications this had in terms of recoveries, grade and sales. And in the Q3 conference call Anthony Tse gave us all a firm impression that there would be lots of good announcements before the end of 2018 about SdV, as well as lifting our hopes about possible rewards by way of special dividends and the like. There has been a bit of debate on this forum about whether this amounted to a promise. My view is that maybe it was not a promise in a legal sense, but it was pretty close to what a layman would regard as a promise. There are many shareholders like me who were disinclined to sell any of their holding over the last quarter despite the falling share price out of fear of missing out when those announcements were finally made (which never eventuated). So from my point of view, Anthony lied to us. Now that "lie" could so easily have been put to rest had the company made a few announcements. I would have appreciated an announcement during the quarter (and not on 31 December) telling us that the expected good news about SdV partnerships would be delayed. And likewise it would have been good to have had an announcement telling us that the actual receipt of the POSCO funds would be delayed until the Salta tenements transfer could be completed and that this could not happen until February 2019 due to the Salta Mining Court being closed for holidays for the whole of January.
Anthony has indicated previously that the company is aware of our posts on HC (that's how AC got his lunch invite) so he would be well aware of the angst that all these uncertainties are causing retail holders. So Anthony, if you are reading this, could you please do something soon to improve Galaxy's abysmal PR.
I am looking forward to hearing more during the conference call.
You can see it as a glass half full or a glass half empty announcement. Things have taken longer than expected and there have been unexpected problems. But no big problem. Ever tried to build a standard suburban house. Unaccountable delays beforehand with local government. Suppliers and tradies let you down and then the client is unhappy with the delays and the end product and holds back money. I suspect a mine is slightly more complicated and expectations are not going to always be met. There are more positives than negatives from this report. It was common knowledge beforehand that the price had taken a battering but Mt Cattlin is still profitable and there are firm plans to move SDV and James Bay to production. In time Mt Cattlin will be a minor asset for GXY with the other 2 dominating. There is no JV with SDV yet because the offers have been too low. GXY can and will go it alone if they can't get what they consider a fair offer. Nothing wrong with that strategy
