Many valid arguments and valid concerns.
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In terms of SP and MC, we are not the only ones at 52 week lows.
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Nickel, lithium, RE's and minerals in general, in small mid and even large cap companies are all getting hit hard.
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Small caps decimated....
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BHP, FMG, PLS...all at or close to 52 week lows....we are not alone....
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Certainly a time for strict fiscal management, constraint and consolidation.
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So what is best for IXR and its shareholders?
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We have debated many options and scenarios going forward.
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Our cash on hand is not enough to see us through.
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We are actively looking for finance and funding, partnerships and grants to sustain us and help us grow.
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IXR also has assets at its disposal to liquidate and add to the coffers, to progress and play out the strategy.
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As mentioned on the last quarterly, the VMM equity stake is probably the first point of call.
This is a decision which needs to be made asap.
They too are close to 52 week lows and it may be worth hedging some equity, and selling some in case it tanks further.
The percentage you retain can be kept for the possible uptick in price and I am sure smarter minds then mine can be consulted to work at a balance to sell or retain..
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The other is the divestment of Makuutu.
Many here have previously argued that the highest value the company has ever seen, was when Makuutu was in the headlines and progressing toward one of the biggest most advanced RE resources in the world.
But, there has been a major shift in economics, RE pricing, inflation, money markets, financing and liquidity in small caps since then.
The environment has changed....the world has changed......
And in this climate, with Belfast making big strides of late, with all its positives, pluses and engagement with key stakeholders...in my opinion, the future direction could change, and Makuutu may not be in it.
I am not writing it off, and if they crunch a defence deal for heavies from Makuutu, it could work...never say never....but for now I am happy its on the back-burner.
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The strategy going forward has become quite clear, and unless you have been living under a rock, the company is
heavily leaning toward Ionic Tech and the expansion of Belfast.
All efforts and focus are in this direction, and for good reason may I add.
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I asked Tim at the GM whether that in loose terms, the strategy emerging,was Belfast, then Makuutu, and finally Brazil?
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He more or less agreed, and it seems to be playing out this way.
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So are we any closer to answering the question, what is best for IXR and its shareholders?
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We are getting there...the strategy is unfolding.
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Strict Fiscal management?
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We have touched on equity injections from the sale of VMM shares or Makuutu, or both.
Costs have come down, capex has been minimised.
Finance, funding, partnerships, grants and offtakes are actively being pursued.
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Now many have mentioned the remuneration of our executives, and what in roads we can make here to preserve capital and give us a longer runway to execute our strategy.
And I agree, it must be looked at and must be part of the equation.
Something needs to be done, and there are many levers that can be pulled and alternate arrangements that can be made to reduce the cash burn.
Pay cuts, pay freezes, deferred payments, bonuses tied to performance....etc...etc....
In my book, these are just as valuable as a director buying on market.
It is as much the optics of the messaging, as it is the validation of the directors belief in the project.
Belief to the extent that they are prepared to sacrifice short term remuneration for the long term vision, and the pot of gold that awaits them if they execute the strategy.
I mean that is the belief we as investors have, right?
We believe in the idea and the vision, then we believe in the strategy, and we pay for the privilege to share in the dream.
Since i have been invested, I too have payed for the privilege, and i will analyse, post and attend meetings as much as possible. But there has been one notable individuals on the BOD , who has 2 million reasons to make this succeed.
Lynch's investment is heavily underwater, and in terms of outlay to remuneration, he has tipped in 5 times his annual salary into the company...and this contribution has gone a long way to currently keep us afloat.
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But for me, its the optics which are the validation of his sincere belief in the future of this company.
Whatever he is privy to and has seen, has made him a believer.
I see it in Tim's eyes too, the belief. But it is mixed with frustration and a faltering patience.
Come the agm and rem report, a big validation of his belief, may come in the form of some sort of personal financial lever being pulled. And by extension, have the board follow his lead.
So, strategy, strict fiscal management, and capital to execute.
Even after my rant, i see them working, I see the strategy playing out and i still see them getting the funding....it is possible.
There may be little appetite for the more risk averse investor, in which one might consider exiting most small caps and critical minerals investments for the moment.
These are precarious times, and it is ugly across the board.
As they say, it is darkest before the dawn.
The macro may see a turn for the better, with rate cuts widely tipped to begin in the US in September.
CPI, PPI well down, and the jobs data showing rising unemployment, may be able to scare the fed into cutting rates......and we will eventually follow. The money printers are working overtime, with a corresponding increase in the M2 money supply, which usually floats all boats. So although the overall outlook is not great, trying to prevent recession the small cap sector may see more liquidity headed its way soon and we may see see capital that's been sitting on the side-lines gaining 5-6% safely, being pivoted to riskier assets and the small caps. May take a few cuts but it should eventually happen.
So it may jus time out well, with the macro being more favourable for the small caps, and with an announcement for Belfast.
Will this happen??? lets hope so, we surely deserve a break....
(20min delay)