We are still in the 300, even though our official position on the ASX is 655.
In terms of shorts and manipulation, the same crap will continue....
Sub 2c looms.
CXO is out, so it will be interesting to see how their short interest of around 6% is affected.
ASX300 Removals
As for where to from here, its a tough one...really tough.
A merger with PLL....no bloody way.....Keith is a dead man walking...
I am not sure how well people understand PLL's offtakes to Tesla and LG are structured.
They are making a big loss on every tonne sold.
The less they sell the better....
Tesla is notoriously ruthless to deal with and always attract a deep discount to spot.
LG even stated that for their US$75million injection, they would receive priority allocation and a discount to market....
- The pricing for each shipment will be determined by a market-based formula linked to the published Fastmarkets Index Prices for spodumene concentrate on a trailing basis.
- In consideration of LG Chem’s substantial investment, the price is subject to a discount based on the prevailing market price at a given time.
Merging with them would be a complete disaster.
Not only are they losing big on each tonne, but via offtake, they are on the hook for that material with entities who are willing to sue.
Tesla tried it on with CXO, when they bailed out of their agreement and will do the same with PLL.
That nearly happened when their original supply to Tesla was not realised, then negotiated to come from NAL.
Then there's the management team.
We already have too much dead wood on our BOD.
Who will leave?
Brindle, on AU$2.5m, or Keith on AU$6m?....their exec team is costing around 15-20m/year in salaries.
Or will it be Buckler, Brown or Crawf.....yep, good luck Whisky on working that one out.
Dow and Dougy will want to stay....
Sylvain may even go, if Brindle learns enough about running NAL, and is forced out by keith. He does seem to get his way...
What a mess that would be.
And PLL with basically no ops experience, particularly none in lithium...no thanks.
You are way better off letting them crash to their own demise, weighed down by heavy salaries, loss making offtakes, and essentially no assets, and
use that as leverage to take NAL from them.
At least their offtake is minimising our loss from NAL, and the sales to PLL could be close to breaking even if they can get the opex to US$600, which is still a BIG ask.
So maybe the answer for now could be to supply PLL, but no JV shipments?
Not sure..
There's guys being payed cumulative millions to work that out, but I have yet to see anything innovative, imaginative or remotely effective in slowing or stemming the bleed.
For us, supplying to the spot market has become non sensical.
With spot at 741, and our haircuts for grade, shipping and trader commission, our realised price would be in the US$400's.
Our last quarters opex was US$1000 (AU$1506)
Opex was coming down, and the BOD were trying new mechanisms to increase realised price....but the gap is too wide, the bridge too far.
I am not interested if they can drop it 20%or30%....it need to drop 60% if we are going to get anywhere, which is completely unrealistic and dam impossible.....yet they have basically ruled out production cuts, and C&M, although discussed, will be a last resort....when its too late and they go to the market for funds, which will be a disaster in itself.
We know JB's plan was a consolidation, and we have seen how well that worked at Morella.
Will Dow follow through with that mandate?
So as our MC and SP drop day after day, we may indeed find ourselves as a target, but it wont be a favourable deal for the shareholders.
The risk adjustment for NAL would just be too high, for someone without deep pockets and a master plan to take this on.
The possible 4th failure of NAL looms, and although I know the bricks and mortar value, I feel the market ascribes zero value to NAL.....the loss making cashcow who has seen many pour in hundreds of millions, and walk away with nothing.
Even CATL....
So, i eagerly await the next quarters figures, and pray there is a substantial change in the trajectory of our costs and our realised price.
Because without that...or .without some brilliant change in strategy from the board, we are finished.
(20min delay)