I have been monitoring the forum since the beginning of the year, but haven't posted much as to be honest, there really hasn't been much happening. I know we had the "world class" results and whilst they are great, what matters now is what can be translated to the bottom line. The MMP approval and the updated DFS are the next things that I am watching for.....but what do I know, I thought the environmental approvals might have provided a kick, but nope, it didn't. Before that I thought the PFS might have made a difference...nope, and then I thought the DFS might have made a difference...nope, so take my comments for what they are.
There has been a fair amount of negative sentiment finding its way into this forum over the course of this year so far, but I am not sure that I understand it. We are in the exploration game looking to become a producer - this is no small thing, and it will not happen overnight. Look at any producer, their share price has oscillated at low levels for a long period of time.....until it doesn't. When a project can conclusively demonstrate that profits are achievable, then the SP goes up. We have a DFS that says that we can produce concentrate at $300 per tonne, but we are yet to prove it. The DFS also says a lot of other things that we are yet to prove, and whilst I am confident that we have a great venture here, the big money is significantly more experienced than I, and will wait.
This waiting will ensure that government approvals are received and that the resource can be proved up to something that is quantifiable to more than 3.5 yrs mine life. Once it is documented that we have more than 10+ years mine life, at a great grade with all approvals in place - watch what happens. To me, it makes sense, and because it makes sense, I am happy to wait. I have a significant holding in this company and I am not worried, it all just takes time. I have been holding for a few years now (I know that others have been holding longer), so I figure that another 6 months is no big issue.
We saw in the quarterly that we have enough cash to get through the end of this quarter, and considering the wet season, we may have enough to get us through the next as well....thus, we have some time before we need a CR and therefore have some time before we see a hard ceiling in the SP. SB keeps saying that we will aim to be construction ready by the middle of the year, my feeling is that a construction ready mine will be worth more than an approx 30mil market cap.
There has been a heap of talk on here suggesting that "construction ready" means potential takeover - I get that the recent takeover provisions passed at the AGM may fuel this, but I am starting to wonder if the "construction ready" comment is based on the company having a few issues with achieving finance. I am eagerly watching AJM to see what kind of finance deal they can achieve to give me a sense of what the current market conditions are.....I suspect that given the length of suspension and the trouble they were in prior might suggest that they are having some trouble finding appropriate terms - given the poor situation they were in, I would suspect their deal to be worse than anything we can achieve as theirs is effectively a bail out. I also wondered why the recent post shared by @sabine was an interview with Simon, the core finance manager. I haven't seen many interviews from him and that might suggest that they are looking to encourage some kind of interest from the finance angle. If finance is the issue, I have no doubt that an improvement in the lithium price will bring a lot more focus to the industry, and perhaps SB knows this and this could be why he is pushing the "construction ready" concept. I really hate how short sighted our finance markets are and there is a constant trend towards chasing the quick money, but it effects our ability to evolve. The one true fact though is that it cannot be denied for forever.
I was speaking recently with a contact of mine that is involved in the automotive industry in Denmark, when asked about how the EV penetration is going, their response was "we are seeing many more EVs every day, but that is nothing compared to the amount of hybrids that we are seeing". News flash...hybrids still use batteries!
We are early adopters of a technology that the rest of the world is only just waking up to, hold tight, CXO's time will come. If a take over offer does come, and it isn't a genuine offer, I will put all my shares to vote to say 'no'. Honestly though, a take over offer does make something simple....I wouldn't need to work out what price I want to sell at, I just need to evaluate the offer. Where I am at right now though is that I won't be voting yes to any offer that is less than 20c.
CXO Price at posting:
3.5¢ Sentiment: Hold Disclosure: Held
