Hi all,
FYI spoke to an FFX company spokesperson after today's recapitalisation update (still relevant to the market's perception of LLL given past ties & the recent demerger).
My recollection of the conversation has resulted in the below points, which in turn summarise my understanding of the current state of play (please note that this opinion piece should not be considered as financial advice of any kind, so make your own enquiries and DYOR).
1. FFX has ~$40m in cash as of today, could even be a little more - hence
'Firefinch remains in a strong financial position' wording in today's ann.
2. FFX the company, INDIRECTLY owns 80% Morilla SA. Therefore, Morilla SA insolvency process (expected by FFX) does not require any further funding or large payments from FFX.
3. FFX as a trade creditor, may be able to claim a portion of Morilla's debt and transfer the loss to its balance sheet for potential offset of future gains. Note: this would not affect FFX's current cash balance nor current LLL holding in any way.
4. I complained about the Chairman's consultancy fees of $3K per day, labelling it as extremely excessive. Whilst I did not receive a YES or NO response as to whether this would continue, it was explained that Fraser's consultancy services were due to the transition / attempts to recapitalise Morilla etc. However, given today's update, those services are unlikely to be required ongoing.
5. Personal opinion only, I am happy with today's announcement given the circumstances and the short-term outlook (at least) for POG. IMO today's update provides surety in terms of preserving remaining shareholder value, at least for the foreseeable future.
If the current BOD decide that they would like to continue in their roles and no EGM is called to remove them, dissolve the company & return remaining wealth to shareholders (my preference btw as this mob have lost my trust), then they should be LAZER FOCUSED on LITHIUM, rare earth or Battery Metal opportunities ONLY.
To the FFX BOD I say this. If you really want to keep your noses out of trouble and instead would like to make a name for yourself (in a positive sense
) in the mining business and create a lasting LEGACY of which you and your families can be PROUD, then please stay away from Gold, stay away from copper, and stay away from all the other mature & marginal crap that is presented to you as a company making 'opportunity'.
IMO Lithium is one of only a few commodities businesses (and BY FAR the highest margin) that will continue to create enormous wealth for years if not decades IMHO. Why not be part of something grand.
6. LLL, finally freed from the shackles of AC, incompetent MA & months of FFX uncertainty & mismanagement of Morilla IMO, should absolutely ROAR from here (pun intended).
Today's drill results were absolutely spectacular, just look at the grades & width of those pegmatite zones.
IMO this will contribute to a higher overall grade for Goulamina (already well above average by global standards) and therefore even bigger efficiencies / profits over the journey / LOM i.e. once the geological interpretation has been incorporated into an updated MRE (expected next month).
Finally, LLL's management team looks so much more capable & credible with the appointments of Simon Hay and Rick Crabb IMO. Every shareholder (both FFX & LLL) should be very happy about this IMO.
GLTA
Cheers
Elpha
(20min delay)