Nothing is being "hidden" imo.
An interesting topic though.
AFAICT:
The ownership nature of the JV simply means that all of the relevant information is not presented in the ASX reporting templates/reports.
There are other entities involved besides AGY.
Afaik the revenue from product sales is paid to Puna Mining SA, as the owner of the Rincon project. That is just how it works with the structure of the companies, and therefore that revenue (so far) is not reflected on AGY's financial reports; since that money is not flowing TO AGY, it is flowing to Puna Mining SA.
Similarly, Alurralde and Menendez aren't reporting that revenue on their tax paperwork, as the other entities that have ownership in the Puna Mining SA joint venture.
All this means for us if we want to stay on top of the financials as much as possible, is that we need to understand this structure, and note the revenue to Puna Mining SA, when it occurs; which is not "hidden", since it is reported by AGY, albeit not in the "normal" way that a simpler structure would be able to include it.
For example, last quarter saw the shipment and delivery of 20t at US$13,400/t.
We were told in the Q3 report that this was contracted and to be paid upon receipt of shipping documents, which were yet to be finalised/supplied.
It was reported shipped and finalised in Q4. Great. Revenue to Puna Mining SA noted.
What does this actuallymean though, for AGY..?
Afaict:
That revenue supports the development of the Rincon project. Simple.
Some of us are here because we expect that some day, as the project is developed further and generates profits, money will start to flow to the JV partners, of which AGY will have 90% ownership of Puna Mining SA.
At THAT point, AGY will see revenue from Rincon on its books i.e. we will see that (our portion) in AGY's financial statements.
All this means imo is that we just need to understand the structure and look a bit deeper to keep track of how the JV is performing as it grows and the revenue starts to flow more consistently.
The key information is all there; I don't buy this idea of them "hiding" a "crucial part of the balance sheet".
It would be blatantly incorrect for AGY to be showing Puna Mining SA's revenue on AGY's balance sheet. It doesn't work like that.
Revenue to AGY will only flow when it receives it's portion of profit distributions from Puna Mining SA, afaik. At that point, the other JV partners will receive their share also.
Some might see this as "misleading" or similar, as it appears you do, however also note that Puna Mining SA is spending that money on the development of the project, and that specific expenditure is also not listed in AGY's financials (which is exactly how it should be).
AGY's finances are separate to Puna Mining's, and we simply need to juggle a few pieces of information if we want to see the overall picture more clearly.
The bottom line imo is simply this:
- Puna Mining SA owns the Rincon project
- AGY is in a JV partnership with Alurralde and Menendez; combined, we 100% own Puna Mining SA.
- AGY is supplying Puna Mining SA with funding for development as per the JV agreement, for which AGY's ownership is currently 77.5%, and will increase to 90% upon key milestones.
- Revenue from any product sales will flow to Puna Mining SA; it is currently (and will be for some time, afaict) being put back into the development of the project.
- It would be improper to include that revenue on AGY's books.
- Eventually, when profits are generated from Rincon, money will flow to the JV partners, and we will see this reflected in AGY financial statements
- Until this time (and even afterwards), astute investors/observers need to understand the structure, and understand the context surrounding how and where revenue etc is (or is not) reported.
Afaict, AGY cannot report revenue on its financial statements that it does not actually receive. More than happy for anyone to add to or correct any points/thoughts above.
Cheers
(20min delay)