All really strong points Zenzmen.
I agree across the board with all the points you make. One main take I want to make is that across the materials sector it is considerably down at the present and this can change and be strong for some time. At the moment materials and BSM is down in the trough- and I feel near the bottom. But this can change almost overnight and the world is always going to need the metals market- and I feel the trade war has huge implications here.
Sent an email to Peter Wright just asking how the company was progressing with offtakes and also in general and have his response below...
Morning ____,
Obviously it has been a very tough month for equities, the worst since Oct 2008, which was the GFC.
Bass is not BHP/ANZ or Rio Tinto so when the markets behave like this you get volumes in riskier asset classes like our emerging miners moderate congruently selling increases, clearly this has happened with Bass and to be fair most of peers.
We have made a series of what we thought material announcements over the last period which have been met with little to no reaction from the market. In particular the 30m channel sample at 3.7% Li2o.
Whilst I do not enjoy the current share price weakness, and I am a material holder of the stock under two Macquarie River Holdings capacities, practically speaking it is only an issue if we need to raise cash via equity issue, which we don’t. We deliberately retain a prudential level of cash of hand and have an ever growing list of receivables as sales ramps up over the coming weeks / months. More importantly we have zero debt to service and 100% of our project.
This for me is a 5 to 7 year and perhaps beyond investment horizon , so for me its expected over this time we will have these periods of weakness its part of being listed. Notwithstanding this has been a particularly strong retraction and I do sympathize with those that have far shorter time frames, as do I with several other investments.
Referring to your questions specifically:
Sales are increasing strongly, it has only been the last few months we have hit nameplate capacity, and hence been able to accurately table inventory for customers both existing and forecast . For me the foundation stone on which all will follow is hitting that nameplate production which we have done , we have an incredible team at site lead by our CEO whom have delivered this outcome, crucially the retained I.P will be absolutely crucial for stage 2 & 3. We look forward to reporting materially increased sales over the coming quarter, and again the quarter after that and are making very strong progress on this front .
Regarding sales and offtake we have done a lot of work in broadening our sales channels and think this will be successful.
Regarding the lithium we will table results over the course of this quarter.
I hope this helps, operationally we are fine , financially we are fine , we have zero debt, and own 100% of project which is producing at nameplate, we have significant IP for stage 2-3 and advancing and well-articulated plans to do so .The last piece of the puzzle is to materially grow sales which we will do.
I cant answer when the market will settle if not begin to recover. Thanks for your support to date I hope this is useful.
Sincerely
Peter Wright
Executive Director
MY TAKE...
I am a happy holder of BSM and are looking long term. Metals shares will turn around, and BSM will soon announce offtakes, etc. Yep the market is getting hammered presently- but this is across the sector- and BSM is primed to kick goals when the turn around comes... debt free, great quality product, company fundamentals terrific and clear leadership and team.
How many other companies can brag they've their deadlines and achievements like BSM in the last 12 months?
