I was once a shareholder a little while back, and sold for a small profit only.
I have to say that I've been surprised by the lack of commentary here on this announcement, because after reading it again, it clearly means a great deal to the directors, and one can certainly sense their frustration in the tone, particularly with an American advisory firm that they accuse of basing their advice on director compensation on an Australian interpretation.
this announcement came out 9 days before the notice of adjournment of the AGM, so it would appear they had been counting the voting that had taken place so far and at this stage were probably thinking their compensation plan was not going to get over the line.
So what did they do then, well ..... 9 days later they announced an adjournment of the AGM, partially using COVID as an excuse for turning the future AGM into a virtual event, but I'm a bit skeptical, because if you look at the votes against many of the resolutions, there is around 33% against. I'm presuming here that they would have all passed though, by requiring 50.1% to pass, but they didn't get a quorum, so only a few shareholders turned up to the AGM, which is not a great look.
In the announcement, they make very definitive statements that they are an American company, and they drove the message home, and I just got the sense that because of this issue with the advisory firm and it's interpretation, the company would like to de-list from the ASX and be only listed on the NASDAQ. I think they will be exploring this in the coming year, and probably already have people working on it. A couple of companies I have owned in the past have done this, which has been no problem to me, because I've just had my entitlement transferred to my Canadian broker, but for some Australian shareholders it is a real pain in the neck and can present problems.
The share price has been taking a real hit, while other lithium stocks have been booming, so something seems out-of-sync with the normal market sentiment here, Piedmont seem to be on the nose for some reason, and approaching yearly lows, when nearly all other lithium stocks are at yearly high, so the contrast is very stark, and it leads people to start investigating why, and not searching for excuses, but just to come to some objective truth and understanding, and facing that, whether you like what it is, or not.
Personally, I think their market cap is still inflated, and I'm not a fan of non-producing companies having market caps over $1 billion, but that's just my particular bent. Chart wise, they are also looking poor, the 10 day EMA is still down on the 35, so the downward trend doesn't look like changing just yet.
All of this will probably make the local landholders happy, at least the ones who are protesting in Gaston county and lobbying the local council and state government against PLL.
The other thing I don't like about the tone of the announcement is my sense that has some subtle hyper in there, about establishing a leading position in the EV revolution and returning those benefits to shareholders etc. And them building an exceptional leadership team that need to be paid accordingly (i.e. exceptionally, with free shares and entitlements). And then there is the pleading, aka " ... we ask that shareholders take a discerning look at our compensation proposals ... " etc.
And I have to be honest and say that some of the language really annoys me, especially when they use the words "war", and "revolution", for goodness sake, can someone please tell them that they are a lithium company, not a damn American military force invading Iraq.
And then the finale, oh yes .... there is nothing like ending a frustrating aggressive pleading letter to shareholders with a bit of boot-licking and ingratiation, " ... no matter how you vote, we thank you for your support ...". Yeah right!
The bottom line is this.
I think the board now realise that they need to make a couple of very clear and decisive decisions going forward.
First amongst them is, by sprouting all their American and USA credentials, which is quite fair enough and perfectly valid, that they need to remove themselves from the ASX - pure and simple.
And that is the simple thing it would seem, when compared to fighting the locals and their councils in Gaston country, but at least they can do that without the added ASX distraction.
I think this will be one of their clear goals for 2022.
And they are going to have to make a decision on Gaston county at some point, if the delays look like running into years (and years) then they are going to need to implement plan B, and in a timely manner.
Good luck to them, and as always, it will interesting to keep an eye on their developments.
And as for this announcement, well .... to be fair, at least they had the honesty and guts to present their arguments to shareholders via an open letter, and you have to respect them for that.
I might even become a shareholder again one day, when a few of these issues are sorted out, and when the chart is looking better, but they should hurry up if they want to catch the current lithium wave. And I can only with them the best in their endeavours, and hope they succeed, because it hasn't been easy for them. And you never know, because those with big ambitions who keep plugging away, often win in the end.
Gw
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