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WPG wpg resources ltd

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But on the other hand...... there is reality.

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worzel1

1,364 Posts.

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07/10/17

00:58

Post #: 27728517
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Originally posted by dannytwo ↑

Totally Agree.

Good to clear the air - good move.

Nothing has changed with guidance, albeit this should kick in more from the Dec qtr onwards, due to issues already announced. Don't expect fantastic Sep qtly, they have forecast that. There is always the possibility with not meeting guidance as Challenger is complicated as previously stated, but they weren't far out last time.

Pybar apparently doing an ordinary job. Got the ass, not happy about it. Chasing things down the litigation side of things is madness - destroys their reputation and likelihood of getting money. There is enough evidence in previous announcements of the issues happening - if it does go down the litigation path that would take a couple of years and WPG would have good grounds for offset claim as they have mentioned. If it did take a couple of years, current cashflow not effected in a meaningful way anyway and if this goes the way we think it will production wise and lowering of AISC, plenty of cash being generated anyway. If they come to an agreement in the short term will be less than the full amount - so that would not be a company killer either.

Regarding the weird trading. Managed fund sellout before the cap raising making the retail offer impossible - remember the institutional raising was OVER subscribed. Good to not go ahead with the retail raising as the money was not essential at any price. At that point they did not see the Pybar spit coming. Pybar dump their shares, which appear to be bought back by the same broking firm - this DOES NOT MEAN the same people. Can be the holding account for retail holders - I DO this for a living and that is how it works. The conspiracy theory is great - but not necessarily accurate. Morgans were looking after Pybars (diversified) account - obviously told to dump which they did and then they picked up for various clients (my opinion).

So we find ourselves in the situation where there is a bit of a cash squeeze due to poor/unfortunate dumping from fund in the middle of a raising and then a spit dumping of more shares.

Now by cash squeeze, I don't mean squeeze in terms of a company engulfed in debt at risk of breaching covenants. I am talking a producer that wishes to continue to with their development plans in the best way to make full use of the resource / mill. The money they were after in the retail raise was 5.4 - in the scene of things, not that big a deal. If you had a combination of debt and a smaller raise, that would execute their planned development. I don't doubt they could cost cut to produce their way out of this - but that is not the plan and they want to stick to the plan as that gets the best results.

Now - obviously there are risks - but the fact that Wayne has been approachable and is doing the webinar - I take it as a good sign. IMO this is a company that wishes they never hired Pybar and are shocked at the share price reaction to what has happened since (and Pybars actions) and have been caught underprepared for the dive. They are interested in executing their plans but are caught up in public relations exercise.

I have been in this position as a holder before - and if I thought this was hopeless I would not be posting, I would have sold at a loss and moved on by now.

This is when the money is made people.

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But on the other hand...... there is reality.

WPG Price at posting: 2.3¢ Sentiment: Sell Disclosure: Not Held
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