No @Viperman02 - I don't think PAM faces insolvency in the near future (i.e within 12 months).
I suppose I'd better back that statement up .... apart from the obvious that insolvency is not being able to pay your debs WHEN THEY FALL DUE... so its all about timing for starters.
But you are right to be concerned. When you look at the Balance Sheet as of proforma relisting date. All $$$ are US$ Current Assets (CA) = $1,676,671 Current Liabilities (CL) = $1,011,698
Simplistically Working Capital (WC) = CA - CL = $664,973 ... at least its a positive number
And we're also looking at project costs of $890K before corp costs .... so since we do not have cash flow all that simply means additonal (equity) capital will be needed ... but arguably that's what the ATM is for and you see that PAM's intention is of course to apply for the 15% placement capacity (as all juniors do).
As you look closer the first thing to look at is the Convertible Note issue. It very clearly shows: CN to cash is $365,876 CN to Payable is $199,332 ... so some vendors accepted a CN as payment CN maturity is Feb 2025 where they are either repaid (US$565,208) or converted to equity at AUD$0.15 ... and obviously at the current price I can't see anyone convert their CNs to Equity ... but that's the risk that PAM's taking ... issue the CN and hopefully the achievements in the 12 months post issuance raises the stock price above the convert price so cash is not repaid.
The section on Working Capital goes through it with some estimates based off the March Qtrly.
Net Net ... very little of PAM shareholder capital will be spent on RKLP. The document suggest PAM's expectation of an "outcome" to be reached in the Sep Qtr (given the glacial speed of movement in Thailand ... I push it out to end CY'24) and it is likely a threesome (some innuendo fits but I'll let it slide). This has got to be a "project finance" structure ... I've put my thoughts on this out before ... they haven't changed ... its still Mine-2-CAM ... PAM's "ace" remains the feedstock (i.e. the Lepidolite) and the partners have the expertise in getting that to carbonate and then to CAM. Valuation and structure have many and varied possibilities - but I can't see any that has PAM tapping shareholders for equity capital.
Either there is value in processing Lepidolite Ore in Thailand into CAM for battery cell manufacturer (in Thailand) for installation into EVs (manufactured in Thailand) or there isn't. One way or another the talk will have to end, with either Thai Gov't walking back their narrative the whole EV/LiB strategy, or them putting up the cash (via IRPC/PTT) to get this going. PAM can't do much more here IMO.
PAM Price at posting:
10.0¢ Sentiment: Hold Disclosure: Held
