AGY Shorts, page-546

AGY's expenditure for the June quarter was $6.46m. I can't see a great deal of change with the scope of operations for the September quarter, therefore I believe costs will be roughly in line with the last, probably in a range of $5.5-$7.5m. For reference, expenditure in the March quarter was $5.16m, and the December quarter was $4.71m. Expenditure has been rising steadily throughout the commissioning period, despite 98% of development works and 90% of commissioning already having been completed by 30 Jan 23.

Remember that in the September quarter, AGY were still drilling for the MRE, they've been testing, adjusting and replacing equipment in the 2 ktpa plant, and they've been conducting pre-works for the 10 ktpa expansion. With expected cash burn at the upper end of my assumed range, I expect to see a cash position of ~$16m as at 01 Oct 23.

If my assumption eventuates, AGY likely only has two quarters left of cash reserves (note that they're not going to run cash holdings down to almost nothing before raising). Without imminent meaningful production, external funding will be required by April next year, whether that's through debt, a strategic partner, or a cap raise. As @Sdaji has pointed out, it's quite clear that the shorts are assuming that a cap raise will occur. Why else would they be piling in near 52-week lows? Given AGY's history of underperformance/missed targets, it's hard to argue with their logic.

If JZ can pull a rabbit out of a hat in the next few months, a CR might be avoided. But IMO it's looking like a strong possibility either late this year or very early next year. On a separate note, today will probably painful, the US was a bloodbath overnight. We might be re-testing 52-week lows today.