At it again I see. Down ramping viabullet point-like accusations scant on any justification. You wouldn’t happento be from an investment banking background would you? Or possibly a speech writerfor one of the Republican Freedom Caucus members?
I agree that NMT management appearto have limited to no experience in developing and running an operational plantof this technological magnitude, in particular in Europe. At a guess, I suspectthat is why they established Primobius in JV with the SMS Group, one of Europe’smost renown plant construction and mechanical engineering services groups. Are you suggesting that SMS (and thus Primobius) don’t have the experience to develop these types of plants? If you mean they don’t have a history in developing battery recycling plants then sure, you’re correct. The problem though is that neither did anyone else until a few years ago, and guess what? At one stage no one had experience in constructing electricity grids, or nuclear power stations, or even waste water treatment plants either. But there were innovators who pooled together the necessary skillsets, worked together, and made it happen.I think Primobius’ extraction ratesto date from the pilot plant speak for themselves and validate the decision toJV with SMS Group – combined skills / tech are achieving results. That said, NMT’sinhouse team has grown over time and I view it as a positive that they increasinglyhave extensive experience in such areas as metallurgy, chemical engineering,energy transition and plant construction and operation. Staffing levels have grownbut that’s to be expected as the 4 distinct divisions develop. It has been agradual build-up which in my view is prudent..
Now what’s all this talk about fancyWest Perth offices? These days “fancy” and “West Perth” shouldn’t be used inthe same sentence. Have you graced the hallowed floors of NMT? It’s a niceset-up but can’t imagine it’s expensive by Perth standards (the quantum of thedeposit paid certainly doesn’t suggest so). Do you have ideas on alternativevenues??
I concur that eyes have to beclosely fixed on cashflow and I take a great deal of comfort that they have aCFO who cut his teeth in the restructuring space in Asia in his earlier life. Giveme a turnaround guy over the typical auditor cum CFO any day of the week whenit comes to monitoring and strategic foresight regarding future cashflow.
I can’t disagree more with yoursuggestion that Primobius pursue a one-size-fits-all single tiered businessmodel via “secured throughput and ownership of materials” and thus become atypical scrap metal merchant. I don’t disagree that there will be situations /projects where such a model makes sense. But why would you want to commit andlock yourself into a single business model, in a new high tech industry, that(a) is capex intensive, (b) has significantly greater working cap requirements,and (c) isn’t necessarily what the car manufacturers want (ie Primobius’initial customer base). Redwood has just completed a $1b capital raise (ie doublingpre-CR equity). They adopt your suggested model but really have no choice otherwisegiven their customer / raw material provider type. They’ll do very well if therearen’t any hiccups with plant development and commissioning (a common problemin new tech industries), and if US regulations never change (keeping in mindthat a long term government policy there is essentially 4 years). In my view, flexibilityis what is needed in the short term especially given the nature of the industryand the type of customer base that Primobius is focussing on.
To assume that only one business modelexists is disingenuous and certainly isn’t what NMT have advised the market. It’slike saying that a farmer is a wheat farmer purely because he (or she) solely sowedwheat this year. Cents on the $ understates the potential return (I’ve heardroyalties of as much as 10%) and ignores the de-risked nature of what would essentiallybe a free-carried revenue stream devoid of the need for huge capex expenditureand tie-up of wc (and I’ve ignored the marketing and validation of the techaspect that is invaluable via partnering).
I’ve got no doubt that it’s becomingan increasingly competitive industry which is why Primobius can’t afford tostand still. They need to continuously innovate if only to ensure that the restof their “competitors” don’t catch up with respect to their extraction rates.It’s tough being an industry leader – everyone is gunning for you and trying toimprove on your product.
I don’t understand why you considerthe London listing a joke which “screened (sic) of desperation”. Europe iswhere the initial focus of the Primobius battery recycling business is. Londongives NMT increased investor visibility, in a larger Greentech market, andpotentially a wider investor base. You’re not going to get the same degree ofinterest from Green Tech investors purely from the ASX. I also don’t think youcan measure the success of the London listing off it’s first 18 months. It’s along term proposition that will at least require the first plant to becompleted.
I’m certainly disappointed withwhere the share price is at. But it’s certainly not a reflection of “poormanagement skills” or risk. Quite frankly I think NMT are way ahead of thecurve of their peers on those scorecards. We could hypothesise till the cowscame home as to why we are where we are. But in new industries such as this, ifyou can master the tech (already exceptionally high extraction rates already),can achieve validation from a reputable consumer of your tech (Mercedes ain’t ashabby start), and constantly keep your eye on risk mitigation (which has beena key trait of NMT since at least the Mt Marrion discovery), your chances ofsuccess are heightened exponentially. This will be a marathon rather than asprint – a length of time not generally appreciated by equity markets in today’sage which in itself creates opportunities for those with belief and patience.
Whilst I don’t seem to agree with much of what you post, Istill harbour no ill feelings towards you. In fact you remind me a lot of thefemales I’ve been in relationships for any significant degree of time. Muchlike you, they tended to have negative sentiments regarding where things wereheading, yet they continued to hold.
