Many are feeling pain today with this unfavourable CR.
'Lucky' I was in hospital this morning visiting a family member in palliative care, giving me a little time to get composed, as well as take a longer term view.
For those that are turning on each other or saying I told you so, take a breath and try to be your better self.
Most who read the QPM threads will know I post 100% positive on the company and wider macro/industry developments that support the TECH project. That's because it has been one of my strongest conviction plays from both the industry transformative nature of the DNi process and a matching team that appeared trustworthy and genuine.
On the latter, the Crux interview earlier this year where Duane acknowledged the company's loyal shareholders as one of their three strong pillars sticks in my mind now, with significant goodwill lost with today's raise. Management will have to work hard to repair their reputation with shareholders, which just adds to their workload.
On the former, I still maintain a large part of my conviction, and sense there are some silver linings in the presentation:
- The Sources and Use of Funding page indicates around 65M will be put towards working capital and operating costs for both TECH and MGP.
- Re-looking at the June quarterly, cash burn has been around $20M/Q this year
- IMO the 1H 24 realignment of credit approved term sheets from banks is the company being conservative, and they are aiming for 1Q 24, given the amount of funding sought today and the runway left, so a delay of around three months from recent guidance.
Like a star footballer missing a penalty or tackle, QPM management appeared to have miscued with this CR, no arguement from me there.
Remember though, this project is a team effort. As Sam Kerr said last week, it's never down to one player when a goal is scored against you.
Our team of partners needs to raise their game, and SG and team also need to push them harder over the next few months.
- AGL stop farting around finalising MGP terms
- Lava Blue and the dedicated lab team get the HPA sorted and to customers for qualification
- KBR and others sort out their engineering and provide the performance guarantee, and live up to their moniker 'We Deliver'
- K-SURE stump up and support LGES and POSCO. Perhaps waiting on the next round of flowsheet pilot testing at CSIRO focussed on cobalt recoveries?
- Local financiers having a crack and looking outside the residential home loan market
- Technical Expert RPM Global get their on-site trips done and dusted
- SMT (and others) to provide further investment at a level that supports the QPM project, not kicks it in the nuts
That QPM chose to pick their starting lineup some time ago with little or no bench players will shorten the build timeframe, but has maybe resulted in some complacency in the development phase.
Now is the time these engineering players must earn the tens of millions QPM has been shelling out during their studies, and coach SG gets to ultimately prove his worth.
As Matt Damon's character said in The Martian, he's going to have to science the sh!t out of this. I still think he can.
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