Not sure you can quite categorize yourself as old Joel (as for the fool... hmm... aren't we all at times?).
Great post and I have waited and read, and waited and pondered.... and waited some more before commenting on the quarterly and ALK in general. Had to take stock after the major fall in the share price (well done to you on your exit timing, I think you got out around $0.67 which was very prescient of you).
For better or worse, I have been averaging down with a clear understanding that ALK is in for a bumpy ride, in the sense that in the near term, this should be the last Q which sees cash flowing out (my guess is if they can generate $15m FCF and full draw down the debt, their liquidity position should fall to $60m, hopefully the low point going forward). As Nic in the short video explains, FID for the open pit's won't occur until early 2025. This gives ALK breathing room to steady Roswell and implement the two major upgrades (Paste & recoveries) going on at Tommi, plus allow for all the extra decline and U/G dev needed to set up Roswell for 5+ (hopefully 10+) years.
The changing of the hedging profile, will undoubtably assist in the near term, though I am still wondering why ALK feel the need to 'rush' the highway move, when ALK, on paper, should be able to mine close to 100k p.a, without the open pits.
When I look at the reserves, versus the MRE, I struggle to understand why they are not more focused on converting more of Caloma 1/2 and Wyoming U/G to give the overall operation a clear option of further delaying, or.. even just slowing down the highway development, to put less pressure on the balance sheet?
As of June 2024, I am guessing they have perhaps mined 40-50k from the Tommi U/G mines, leaving perhaps 20k of reserves plus the stockpiles, which combined with Roswell basically gives them a full year of production for FY25. Roswell has almost 250k of reserves (5 years at 50k p.a). The base load is secure, it's just about the other small operations. ALK never really talk about Caloma/Wyoming.... almost no details in quarterlies, or in presentations. Yet for me, they seem incredibly valuable and offer ALK options for their LOM sequencing.
The quarter was a good one, as you point out, first stockpile build in a long time, plant was not even properly humming. Plus, this is still before the recoveries rates increase at the end of this year.
Guidance for FY25 is hopefully conservative (I would be just happy if they hit 70k at this stage).
Whilst this is not the best chart, it was released today an aspiring producer. At least it shows that just for ALK to get to 'average', it would more than double in market cap. A 100k p.a producer with low costs in Australia, right now.. can have an MC closer to $1.6B+.
I guess I would just like to have more commentary on what levers ALK could potentially pull at Tommi, to enhance the U/G option versus an all or nothing for the open pits. If I could ask for one other bit of info, I would love a whole presentation on just Roswell, it deserves it.... drilling.... current future... plans.... even some speculation......
It will be interesting to see what ALKs share price does in the near term, as.... even compared to CYL, ALK is very undervalued, but I can understand that some may not be patient enough to hold ALK, whilst it gets through the heavy capex period.
(20min delay)