This is a make-or-break year for MNS in my view. As it is for...

This is a make-or-break year for MNS in my view. As it is for me to stay invested in MNS. I invested about 3 years ago and the price was higher than it is now. At the time I was considering putting money into another company that would have provided a significant return. Damn. Since then, the battery factory has come online and good progress has been made elsewhere. I still like business and strongly believe it has massive potential, but considerable risk still remains. It wouldn’t be the first company to fail that has many good things going for it.

In the last quarter, granted a few days to go...come on certification!

1. MNS failed certification. I believe most on here thought like I did and took it as a given that it would be an easy check box. Once completed, sales would then flow and the shareprice would appreciate. There are now three companies undertaking certification (not sure why?). This was originally discussed by management at the AGM with a completion target in late December. I wonder if management also had the view that this would be an easy milestone to achieve? I continue to wait, albeit more nervously.
2. The AAM offtake with Tesla. This was an excellent outcome as has been discussed on this forum. Well done to management for getting this over the line with the most influential OEM in the EV space.
3. $50M funding from SBC Global. I did not expect funding to come in this form. So, another good outcome? I am not sure. It does look like a vote of confidence in the AAM plant, MNS and Nachu.

However, there is still much that I believe we need clarity on. As has been my experience with MNS, I don’t find they communicate well with the market. Generally I read positive announcements and find myself with more questions. Consider certification and how vague that announcement was, hard to know if a major issue or a little one. Looking to the next quarter, to me its shaping up to be a big one, and could go either way if MNS miss some of these outcomes.

1. Certification. This must happen soon. I am not sure if it is or might have funding implications or cashflow implications? For example, we have been commercially producing batteries since 12 August 2022. As the operation slowly becomes more mature and labour is hired, production will be increasing. It would be good to see where we are in relation to the installed capacity. Are we now moderating production because we have not been certified? Have we delayed our ramp up? Do we have sufficient storage for the batteries we cannot ship yet? Or is there a fundamental issue in the design with all cells produced to this point? I certainly hope not, but also don’t actually know. IM3NY was the sole reason I invested in MNS several years ago.
2. Funding. I was hoping that the considerable funding enabling IM3NY and/or Nachu might have been announced this quarter. That was always only a hope, however looking forward I am expecting a funding outcome for Nachu this in the coming quarter (June 2023 as per Nachu BFS update). I have not seen any more recent information that would contradict this. I am also hoping IM3NY expansion funding either through HSBC, DOE or a combination will also be announced. Lots of positive commentary out of the USA re loans, EVs, Batteries and removing the dependence on Chinese supply chains. Like many, my view is that certification is holding this up.
3. Site for the AAM plant. As per offtake conditions this needs to happen this quarter, however confident that it will, especially with JLL having compiled a shortlist as per half-year report.
4. Nachu progress. A big quarter upcoming, I personally hope the focus is IM3NY, but don’t want to see further timelines slip as have a way with MNS. As per the Nachu BFS update several milestones come due this quarter.
   1. The equity arrangement with Tanzanian Government should be announced shortly. Hopeful that the recent US-Tanzania relations and AAM offtake will see good terms for MNS?
   2. FEED completed (April 2023).
   3. ESIA approval (May 2023).
   4. EPCM Contract (May 2023). Gannt states negotiations, however I take that to mean contract awarded?
   5. Final Investment Decision (June 2023).

Certification aside, I see Nachu as almost all risk, effectively because it is in Africa, but also because I find information is sparse coming. Aside from the BFS, what new information do we have? The relocation seems to be forever ongoing. Is there any update to the long-lead items? We are seeing cost escalation all over the mining industry at the moment, what is the impact to MNS and Nachu? I remember when PLS were developing their mine and issuing regular updates to the market, they were great. It would be good if MNS developed something similar with Nachu like they did with the IM3NY monthly updates.

So, all in all, I don’t think it has been a good or bad quarter for MNS, although the shareprice might disagree. Without the offtake and SBC Global funding, MNS would have a very poor quarter. I will be critical of the next. MNS management need to start demonstrating they can hit their milestones and advance their portfolio of projects. If they can, the potential of the business they are creating is impressive and a long-long hold for me.

All IMO. DYOR. Not financial advice. Etc etc.