AGY Shorts, page-576

I emailed JZ about the possibility of a CR (it took him a while to get back to me, I emailed some time before the discussion here, he just got back to me tonight). Obviously he couldn't legally commit to me that there is no chance of a CR, but he indicated optimism that we'd have income in time to avoid it. That in itself means nothing to me (obviously he'd never tell me a CR was coming even if he knew it was going to be announced the next day), but I asked quite a few questions trying to give myself dots to join, I'm always cynical and sceptical of anything any company director says, and my best assessment of the tea leaves has me optimistic.

By my back of the envelope calculations we'll be out of cash to keep the lights on by early Q2 2024, which would mean we'd need a CR announced by January or so to keep the lights on if we don't start generating income before then (or have enough production for sales of at least around 50 tonnes per month starting around February).

Obviously there are no guarantees and AGY has no shortage of cases of missed targets, so I don't see it as anything like a sure thing, but the JZ's words and my interpretation of how they were said make me a little more optimistic than I was before reading it, and I was already choosing to hold before reading it. I won't at all deny that I do expect to be a little anxious until we have production ramping up, I don't expect a big jump in share price before then, but permits + production will be a powerful combination, especially with lithium spot prices looking like they're back on the way up. Bonus points for resource upgrade.

I have a clear deadline and production target (quantity and date) in mind according to my own analysis, so at least I have a plan, but I am expecting to be able to just sit and watch without any need for selling before money is coming in and the share price is on the way up.

Incidentally, while playing around with the above I did some quick back of the envelope numbers and I expect we'll retest if not exceed our ATH once we have expansion permits and strong production, assuming we avoid a CR. If the spot price significantly improves (it wouldn't have to get as high as it was in the last peak) and/or there is a strong improvement in the outlook for lithium prices, we should easily exceed our ATH next year (assuming we avoid a CR and tick the two most important boxes). I'm still not too fussed about offtake deals - they're important but with production they're inevitable, so production and permits are what I most care about.

Another one of my questions was being discussed in another thread, I'll go mention that one there.