Kazatomprom Sends Uranium Stock Flying

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Righto muddy miners, welcome to
a a bloody good start to the

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week from you.
It's a bit of a fan of uranium.

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We're up muddy.
Oh, we're up.

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Brought to you by Axis Modern
Technology, the bloody trusted

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advisor and drill.
I'll serve a instrumentation.

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Axis are alive and well and so
is trap.

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For all those people that have
been concerned about his well

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being, he does exist in the
flesh.

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I'm still here.
He's we, we didn't want to

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clarify that you were alive or
anything.

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It was more interesting watching
all the YouTube comment

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commentators wig out.
Just speculate.

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Yeah, yeah, yeah, there was,
there was a yeah big YouTube

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group and like one of one of
them just went missing and they

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never addressed why.
Yeah, I remember he was telling

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me about that.
Yeah.

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Did they ever come back?
Yeah, no, they, they, well,

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that, that member didn't know,
but they, they just thought the

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audience wouldn't like notice.
Yeah, Notice.

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Yeah.
Anyway, that's not us, hey?

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Right, JBD, welcome from across
the ditch.

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He's gonna be back in the flesh
this week.

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We get to touch him.
That's it mate.

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Right we're gone bloody.
She's all she's actually a bit

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of uranium at the start.
There's two bloody uranium

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stories.
Oh, 'cause Adam prom

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announcement on Friday and there
is a bit more going on in the

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world of energy resources
Australia.

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ERI, there is a great Jabaluka.
It is interesting.

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Trav's going bloody deep.
I don't, I don't even know how

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to surmise it, but it's just out
there what's going on and.

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On the other side of the
spectrum, Pilgrim Minerals

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reported there a half year
results for RJD.

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Yeah, Yeah.
I mean get the get the annual

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results actually today and
amongst, you know, a raft of

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other annual numbers coming out.
So I don't know why, but I

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touched on that one again.
It seems to be one people kind

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of interested in, but we'll see.
And then also I thought we'd

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have a quick shout if we if we
have time about the the

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dividends and the company's not
paying dividends as well just to

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tie on at the back.
It's right up.

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Let's get into it.
So it feels like this is my

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calling when like there's any
Cos out of prom stuff, it's like

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and good to say you just
logically put it at this the

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first storage ID like there's
good back in order there, mate.

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Mate, we save ourselves a bit of
work to slot it in nicely at the

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top.
He is all green on the screen

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for the Aussie U stocks.
Most stocks up 10% today.

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Painful first day for the short
as I'd assume so if you looked

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at the last numbers of the short
positions which T + 4.

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So this is probably last
Tuesday.

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Paladin, Boss and Deep Yellow
were all around 9% shorted so we

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don't know yet if any of them
were unwound slightly by the end

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of last week because of the four
day lag.

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So check short man on about
Thursday and you'll figure about

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what what it was before this
announcement.

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So let's let's bloody let's set
the same.

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So because pretty much just
after the ISX closed on Fridays

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when because Adam problem coming
out with their first half 2024

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results, which was sort of
already disclosed at the start

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of August, but whatever one was
waiting for the 2025 production

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garden guidance.
So I'll start with the results

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first then we'll get into 2025
and beyond first half physicals

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which as I said coming out on
1st of August along with their

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updated 2024 guidance.
So they said they got 10,857

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tonnes AU for the first half
with updated 2024 guidance of

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midpoint of 23,000 tonnes AU
which was up from their previous

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guidance that they slash back
down of 21 to 22 1/2.

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So this at that time when they
released that.

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So the pre, pre announcement
that actually sent the bloody

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equities down 'cause they
actually lifted beyond what they

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were thinking for the year.
But you look at those numbers,

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they're actually they're
anticipating or guiding for a

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much stronger second half than
the 1st to reach that 2024

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guidance of 23,000 tonnes.
So they're going to have to hit

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a bit over 12,000 tonnes of U
for the midpoint.

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So, and when, when we say U,
that's tonnes of uranium times

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that by 2600 and that'll give
you 1,000,000 lbs of U3O8

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equivalent.
So JD, you're squinting at that.

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It's a, you're right, Uranium's
you're right, tonnes of U to

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U3O8.
It's not 2200 like kilo to

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pound, it's actually 2600.
Must be, must be a bloody

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density thing.
So now and also the, the new

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info that come out on Friday
that wasn't released prior was

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the inventory levels.
So you can see that they've

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dropped a further 20% year on
year on 100% basis for the Cos

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Adam Prom operations and then
they've dropped 31 percent on

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Cos Adam Prom's attributable
basis.

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So for you can see that they've
only got a bet on the Cazadam

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Prom attributable production.
They've only got a now about

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four months of production in
inventory.

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So look Benny Feingold and the
Ocean Wall team did a great note

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on this Cazadam Prom news.
And you can see in the table

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below from their note that
inventories of well over halved

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since 2019.
And so by the end of this year

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they'll be possibly at 9 year
lows.

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So, and that's, that's based on
them hitting the midpoint of

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their result revised 2024
guidance, so FY22 guidance.

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So I guess what does this mean
is if because Adam prompt don't

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hit their midpoint, so they
achieve 1000 tonne of UU less,

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which is £2.6 million.
And if they want to maintain

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inventories because they are so
low, that means there's

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potential they'll have to start
going into the spot market to

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purchase those pounds.
So maybe like for every thousand

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tonne of U they have to get,
that's £2.6 million in the very

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thinly traded spot market, so.
In simple terms, is that

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inventory depleting because, you
know, they they're contracted to

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supply an amount that they're
not quite, you know, not

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producing?
Yeah, not, not hitting, not

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hitting the physicals, contracts
or contracts.

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And like they, they've
notoriously said, there was a

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comment here saying that they've
notoriously kept some uranium

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uncontracted to leverage off the
benefits of potentially selling

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at a high spot price.
But then the wording is that has

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resulted in them, you know,
depleting because depleting

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inventories because they haven't
been hitting the targets.

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So they've been having to use
that.

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It's actually more fragile
situation.

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Very much so.
So four months of production on

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a big scale, It's yes, very
interesting.

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Now, 2025 and beyond, this was
the, you'd say the big, the big

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news that came out, whatever
everyone was waiting for.

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So from a combination of
construction delays for their

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sites, potential for limited
access to sulfuric acid supply

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to continue, which they're
pretty much saying is inevitable

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until they get this sulfuric
acid plant properly plant

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something properly built on
site, they've slashed their 2025

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production guidance from 31,000
tonne a year to 25750.

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So yeah, that that equates to a
cut of £17.3 million.

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So that that's the output of
Cigar Lake.

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Wow, wiped, wiped like that.
So that's been the big kick.

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I know everyone was sort of
thinking that that was what was

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going to happen, but there was
the feeling that like, oh,

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'cause that problem they just
always over over promising.

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They'll just keep over
promising.

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But they actually went bang.
They're like, look out.

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Yeah, they might.
Who knows, They might be over

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promising on this too.
Who knows?

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The 25750 is still higher than
what they're going to produce.

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So it's still it's it's still
higher than what they have

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guided for this year.
I think it was 14% higher.

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And because as the and the
whole, the whole thing is around

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the the delay in ramp up to boot
an off score, which is like

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that's the big humdinger that is
coming online, but there's been

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delays.
So I'll I'll get into that.

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So because when they initially
guided this whole 2025 onwards,

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they when they said they were
going to get 31,000, which is

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like frigging £80 million, they
said they were going to be

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increasing to 100% of their sub
soil use agreements across all

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their tenements.
So those sub soil agreements

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means they can only they got AI
think it's like a competent

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person report to say you can.
This is the production volume to

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come out of there, and they have
to produce between 80 and 100%

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of that.
They can't go above 100%.

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They can't go below 80% either.
They have to produce in that

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range.
So what this is the they've

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actually mentioned that they're
renegotiating some of these sub

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soil agreements to so because
they're at risk of actually

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falling below the 80% threshold.
So they've gone from saying

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they've going to produce at 100%
as much as they can get out of

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it to now at risk of not even
producing at 80%.

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So they've had to, they're going
to have to renegotiate those

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subsoil agreements so that
they're not at risk of going

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below.
What's the why?

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Why would you produce less than
80?

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You just constrained physically.
Yeah, like will the acid supply

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like I haven't got enough acid
to bloody maintain the

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production.
Like whether there's been

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operational challenges or lot of
what they've the competent

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person report hasn't truly
reflected what's coming out of

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there.
And because I think the as well

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the the lack of stability around
that sulfuric acid supply means

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that like if you start putting
less in, I think it can be like

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detrimental to the like in terms
of the geology of it to maintain

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that sort of steady state.
So it's like, it's like a I

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would compare it to how Stoitus
talks about a pox plant.

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He says it just needs to it
needs to keep going and then the

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temperature needs to be high.
It just needs a steady state.

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Yeah.
And my understanding of this

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based on fuck all is that that
it's probably the same here.

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So yeah, they're the the ones
they're renegotiating that

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they've mentioned are like
booting off score.

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That's the 51% Saturn from 49%
Russia's result on and APAC,

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which is it's Apac's a lot
smaller.

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That's 64% because Adam prom
that this is a Japan one.

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So with 24% Summatomo, 10% kept
car.

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So that's where they're going to
introduce changes to the subsoil

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use agreement.
They're the two of the ones.

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And I guess before we get into
the numbers, I'll show you the

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chart to give a bit of context
around how big burden off score

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is.
So you can say the what this is

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circle that is what that is the
amount of uranium that burden

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off score it was going to
contribute and that has been

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signal significantly pushed back
because I was saying they were

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going to get 2 1/2 thousand
tonne in 2024.

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That's been slashed to 520.
Twenty five was supposed to be

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4000 tonne now guiding 1300 and
2026 was supposed to be 9 play

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00:11:09,240 --> 00:11:16,640
6000 tonne or what's that £15.6
million now 3750 tonne.

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00:11:16,640 --> 00:11:20,720
So 99 play capacity not expected
before 2027.

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00:11:20,720 --> 00:11:25,440
So like 1-2 years light and the
first three years of production

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out of that mine is committed,
all committed to Russia.

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So it both delays that uranium
getting to Russia, but then also

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delays beyond that the potential
of any of that uranium coming to

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the West.
So it's a bit of a question.

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Without notice is like.
Plenty of them.

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Because there's a delay.
Are they, are they still going

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to have some contractual like
obligation to provide, you know,

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Russia X amount in the, you
know, this, this, this 2025 when

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they're supposed to be ramping
up and they have to buy it on

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the spot?
Market, yeah, I'm not I maybe

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00:12:03,680 --> 00:12:07,160
because it's such an outpiped
market you would assume that the

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contracts are a volume basis.
So I think when they said first

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00:12:10,960 --> 00:12:14,280
three years of production was
based on that previous ramp up,

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right.
So whether they whether they

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have to either use inventory or
use their the spot market, as

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you said to fulfil that, not
sure that'd be so Uranium

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contracts things obviously very
opaque, especially the Russian

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contracts.
Well, you couldn't, that'd be

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the hardest one.
If anyone's got info on the

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bloody booted off score
contract, let us know.

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But yeah, it's exactly what you
say they'd be between between

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the inventories and the spot.
I I would assume Russia would be

223
00:12:43,840 --> 00:12:46,400
like, you still have to feel
that you've said you were going

224
00:12:46,400 --> 00:12:48,400
to get this.
You still have to view.

225
00:12:48,400 --> 00:12:53,120
Love, love it, love it.
So now another interesting part

226
00:12:53,120 --> 00:12:57,160
was the sensitivity table they
put in for that revised mineral

227
00:12:57,160 --> 00:13:00,800
extraction text that we talked
about start of July.

228
00:13:01,120 --> 00:13:04,560
Now I'm not 100% confident on
the interpretation of this, so

229
00:13:04,600 --> 00:13:08,840
feel free to message good old
jc@moneyinmind.com with any

230
00:13:08,840 --> 00:13:12,960
different interpretations.
But this is what came out 1st of

231
00:13:12,960 --> 00:13:19,200
July that we, we saw this, this
tearing tax rate based on the

232
00:13:19,200 --> 00:13:24,360
annual production volume for
each subsoil, subsoil agreement

233
00:13:24,640 --> 00:13:28,080
plus the, an additional tax
based on the spot price.

234
00:13:29,080 --> 00:13:35,160
I, I interpreted this as you're
booted off score your Catco,

235
00:13:36,120 --> 00:13:39,840
your which is the, that's the
Urano JV, your Inkai, which is

236
00:13:39,840 --> 00:13:42,080
the chemical JV.
That was the three biggest

237
00:13:42,400 --> 00:13:46,800
producers going forward and on
we interpreted as lot, they're

238
00:13:46,800 --> 00:13:49,280
the ones going to get hit with
the highest tax because they

239
00:13:49,280 --> 00:13:52,040
produce the largest amounts of
volume.

240
00:13:52,360 --> 00:13:59,280
But the sensitivity table they
put in it sort of now now says

241
00:13:59,600 --> 00:14:06,000
that those like tax like between
the spot price and like the tax

242
00:14:06,000 --> 00:14:10,120
rate applied to percentages of
CPR production volume.

243
00:14:10,120 --> 00:14:13,520
Now CPR is the competent
personal support which I assume

244
00:14:13,520 --> 00:14:17,720
is the subsoil volume
requirement for each subsoil

245
00:14:17,720 --> 00:14:20,440
agreement.
It looks like that the those tax

246
00:14:20,440 --> 00:14:22,920
rates are based on the
percentage they take out of

247
00:14:22,920 --> 00:14:25,480
those subsoil agreements.
So even even if they're a

248
00:14:25,480 --> 00:14:29,440
smaller producer, if they're
producing 100% of their subsoil

249
00:14:29,440 --> 00:14:32,160
agreement, even if they're
smaller, they're going to get

250
00:14:32,160 --> 00:14:35,920
taxed at that higher price.
That's how I interpret.

251
00:14:35,920 --> 00:14:38,440
It's not didn't appear to be a
volume thing.

252
00:14:38,440 --> 00:14:41,440
Now appears like a percentage of
the subsoil use agreement.

253
00:14:41,800 --> 00:14:48,880
So, yeah, looking so that's even
more, even less of an incentive

254
00:14:48,880 --> 00:14:52,080
to increase production across
all the thing.

255
00:14:52,080 --> 00:14:55,040
That's how I want to so happy to
happy to get bloody clarified on

256
00:14:55,040 --> 00:15:00,120
that one perfectly.
And it also shows how much more

257
00:15:01,520 --> 00:15:04,200
sensitive an increase in
production is compared to an

258
00:15:04,200 --> 00:15:08,520
increase in spot price.
Because if you look at at

259
00:15:08,520 --> 00:15:11,880
today's spot price, a 10% lift
in production increases the tax

260
00:15:11,920 --> 00:15:16,840
by 2%, but a 10%, $10 lift in
the spot price only increases

261
00:15:16,840 --> 00:15:21,320
the tax by a .4%.
So perfectly articulated by I'd

262
00:15:21,320 --> 00:15:24,800
say Mike Olkin 2 point O art
hard on Twitter.

263
00:15:24,800 --> 00:15:27,000
He's fucking all over at this
blog.

264
00:15:27,440 --> 00:15:30,440
So he says that this is just
future proof that 'cause Adam

265
00:15:30,440 --> 00:15:34,720
problem are incentivized to
produce less and not incentivize

266
00:15:34,720 --> 00:15:37,680
to cap uranium prices cause of
that sensitivity.

267
00:15:38,160 --> 00:15:41,680
So good on yard he was he was
all over soon as it come out.

268
00:15:41,680 --> 00:15:45,200
I think he even have the half
predicted this is what was going

269
00:15:45,200 --> 00:15:48,000
to happen in a tweet the day.
Oh mate, he's a friggin oh.

270
00:15:48,480 --> 00:15:52,560
Love the bloke, love him.
So what is brewing here?

271
00:15:52,640 --> 00:15:57,480
Let's sum it up.
Continued sulphuric acid supply

272
00:15:57,480 --> 00:16:02,480
issues seem to be the thing
still for the inevitable future

273
00:16:02,480 --> 00:16:07,000
and they cause and they're not
even releasing 2026 guidance

274
00:16:07,280 --> 00:16:09,960
until at least this time next
year.

275
00:16:09,960 --> 00:16:13,120
So can you?
Can you think of like for I

276
00:16:13,120 --> 00:16:17,120
guess any, any commodity like
where you've got the biggest

277
00:16:17,120 --> 00:16:21,400
supplier of something in the
world and you don't know what

278
00:16:21,400 --> 00:16:26,120
they're going to be sort of
producing in a year's time like?

279
00:16:26,400 --> 00:16:30,040
Wow, that's a great question.
Does anyone like, is there that?

280
00:16:30,040 --> 00:16:33,160
Is there a something that you
can think of where there is that

281
00:16:33,160 --> 00:16:36,120
much uncertainty about the
biggest supply of something?

282
00:16:36,960 --> 00:16:39,400
I can't think of.
Yeah, JD, you'd be all over

283
00:16:39,400 --> 00:16:40,440
this.
You're a macro.

284
00:16:41,400 --> 00:16:44,880
I think the, the margin of error
around here is way bigger than

285
00:16:44,880 --> 00:16:47,840
any other commodity that that
kind of comes to mind.

286
00:16:48,240 --> 00:16:51,480
I mean that that number, I'm not
sure if you quoted it above, I

287
00:16:51,480 --> 00:16:55,640
didn't hear it, but that is like
a super substantial amount of

288
00:16:55,640 --> 00:16:58,480
world supply that's just been
chalked off.

289
00:16:58,480 --> 00:17:00,680
Like I I'm not sure what the
well it was. 12 I think it was

290
00:17:00,680 --> 00:17:03,960
12%.
Yeah, yeah, I had sort of 11% in

291
00:17:03,960 --> 00:17:06,480
my mind, but I wasn't sure if I
was speaking out of school there

292
00:17:06,880 --> 00:17:10,079
that that's a huge amount.
Like we, we talk about it often

293
00:17:10,079 --> 00:17:15,400
in the context of copper and
Cadelco and them missing by you

294
00:17:15,400 --> 00:17:20,520
know 50,000 tonnes, 100,000
tonnes and they make up maybe

295
00:17:21,040 --> 00:17:25,599
sort of five or 6% of the the
world supply of copper.

296
00:17:25,599 --> 00:17:27,880
So this is just a a whole nother
league of what we're talking

297
00:17:27,880 --> 00:17:30,040
about in terms of scale.
There you go.

298
00:17:30,080 --> 00:17:32,400
Chop that up into a Twitter
short for me.

299
00:17:32,400 --> 00:17:34,560
Someone bloody.
Everyone's been chopping me up

300
00:17:34,560 --> 00:17:37,000
and fucking loving it.
Keep it Gavin Alley.

301
00:17:37,080 --> 00:17:39,360
It takes the light off Alley to
do it bloody.

302
00:17:40,200 --> 00:17:44,880
So look and potentially if they
miss this 2024 guidance that as

303
00:17:44,880 --> 00:17:47,560
we said they'll have to for
every thousand tonne they miss

304
00:17:47,560 --> 00:17:50,920
it by that's £2.6 million of
either got to draw down the

305
00:17:50,920 --> 00:17:54,400
inventory or frigging go into
the spot market.

306
00:17:54,400 --> 00:17:57,240
Remember they've only got 4000
tonne in inventory right now.

307
00:17:57,640 --> 00:18:02,520
So let, let's, and as I've said,
less chance of good chunks of

308
00:18:02,560 --> 00:18:05,960
like going for good chunks of
this Kazakh uranium getting into

309
00:18:05,960 --> 00:18:08,640
the West for the next few years
because of there's so much of it

310
00:18:08,640 --> 00:18:10,760
weighted towards going to
frigging Russia.

311
00:18:11,040 --> 00:18:14,000
So, and how's Russia going to
fill the void?

312
00:18:14,280 --> 00:18:16,960
Spot inventories?
Who knows?

313
00:18:16,960 --> 00:18:21,040
And look, China also approving
bloody at last Monday approved

314
00:18:21,040 --> 00:18:24,040
another 11 nuclear reactors
across 5 sites.

315
00:18:24,360 --> 00:18:27,200
Word on the decline.
They're chatting to a lot of

316
00:18:27,200 --> 00:18:32,520
parties about contracting
purchase agreements JV, which

317
00:18:32,600 --> 00:18:37,800
you know ain't easy because it's
China no doubt, but WNI next

318
00:18:38,040 --> 00:18:41,120
conference start of next month.
That's the historical catalyst

319
00:18:41,120 --> 00:18:44,800
when all the big talks are
talking uranium contracting or

320
00:18:44,800 --> 00:18:47,840
and conveniently timed at the
conclusion of the northern

321
00:18:47,840 --> 00:18:53,240
hemisphere winter, which is
historically the low period in

322
00:18:53,240 --> 00:18:56,520
the in prices and everything.
So now that another random one I

323
00:18:56,520 --> 00:18:58,360
got tipped at the bar and me
shop at lunch.

324
00:18:58,960 --> 00:19:02,000
This come from you'd say
Subiaco's biggest U ball

325
00:19:02,520 --> 00:19:07,440
conveniently ran into him before
the story you got NVIDIA report

326
00:19:07,440 --> 00:19:11,520
in their second quarter FY25
financial results this Wednesday

327
00:19:11,520 --> 00:19:16,080
night Aussie time.
So the whole data centre AI

328
00:19:16,080 --> 00:19:19,200
thing is it's just that another
piece of information that always

329
00:19:19,200 --> 00:19:23,600
has, it seems to have a bit of
an effect on uranium these days

330
00:19:23,600 --> 00:19:25,360
as well.
So it's another one to watch out

331
00:19:25,360 --> 00:19:28,400
for coming this week to see what
effect that will have.

332
00:19:28,400 --> 00:19:30,800
So.
Super interesting mate.

333
00:19:30,800 --> 00:19:32,760
Fuck, what a day job.
Love it.

334
00:19:32,920 --> 00:19:35,720
It's been a like a like a
challenging sort of six month

335
00:19:35,720 --> 00:19:38,840
period for uranium equities, but
you kind of sensed it that

336
00:19:39,480 --> 00:19:42,960
contracting cycle, you know,
now, now the production guidance

337
00:19:42,960 --> 00:19:45,200
you kind of, you kind of sensed
that the, the thesis is doing a

338
00:19:45,200 --> 00:19:46,320
little bit of a tilt again,
isn't it?

339
00:19:46,800 --> 00:19:48,880
Yeah, I'll be and it'll be
interesting to see if there's

340
00:19:48,880 --> 00:19:53,280
any short squeezes going on.
If it does get a bit of bloody

341
00:19:53,280 --> 00:19:58,600
momentum, who who knows?
Oh, it's a bit down on anyway,

342
00:19:58,640 --> 00:20:00,680
the fucking you just, you just
never know.

343
00:20:00,680 --> 00:20:04,480
Oh fucking bloody.
Good stuff man, what a die.

344
00:20:04,480 --> 00:20:06,120
That's impressive.
What a die.

345
00:20:07,000 --> 00:20:11,080
Yeah, thanks Ben Feingold and
art hard and shit for all pretty

346
00:20:11,080 --> 00:20:12,400
much copied everything they
said.

347
00:20:15,720 --> 00:20:17,960
To to a company that wishes they
were in the predicament that

348
00:20:17,960 --> 00:20:25,080
gets out of promise era.
Yeah, they're guiding 0 lbs.

349
00:20:25,080 --> 00:20:28,200
And at least their guidance is
unchanged.

350
00:20:28,360 --> 00:20:29,800
Yeah, very true.
Yeah.

351
00:20:29,800 --> 00:20:32,200
Be a luxury to be able to
provide guidance for these guys,

352
00:20:32,200 --> 00:20:34,440
but pretty interesting thing has
happened to them today.

353
00:20:35,080 --> 00:20:39,080
And for context to anyone that's
like new to the story, they got

354
00:20:39,640 --> 00:20:43,760
effectively 2 uranium assets,
Ranger and Jabaluka both in the

355
00:20:43,840 --> 00:20:47,960
NT pretty close to each other.
Ranger is a rehab project and

356
00:20:47,960 --> 00:20:51,240
there was some hope of one day
developing Jabaluka, which is

357
00:20:51,760 --> 00:20:53,920
are being subject to push back
from The Mirage traditional

358
00:20:53,920 --> 00:20:57,120
owners for for you know, for a
long time a month ago, the rug

359
00:20:57,120 --> 00:21:01,480
kind of got pulled from those
potential plans one day when the

360
00:21:01,480 --> 00:21:04,240
federal government effectively
stepped in to prevent the

361
00:21:04,240 --> 00:21:06,800
Jabaluka mineral lease from
being renewed.

362
00:21:07,200 --> 00:21:10,000
Should be noted that the that
Jabaluka, you know, mineral

363
00:21:10,120 --> 00:21:13,760
lease gave the mirror people a
veto right of any future

364
00:21:13,760 --> 00:21:16,040
development.
So the, the federal intervention

365
00:21:16,280 --> 00:21:18,400
can, you know, fairly be
characterised as actually

366
00:21:18,400 --> 00:21:20,280
removing power away from The
Mirage people.

367
00:21:20,880 --> 00:21:25,280
And now because ERA is spending
a lot of money rehabilitating

368
00:21:25,600 --> 00:21:28,920
Ranger and because this company
is, is controlled by Rio Tinto,

369
00:21:29,360 --> 00:21:31,400
the rehab is expensive as oh
hell.

370
00:21:31,760 --> 00:21:34,680
In fact, they estimate there's
another $2.4 billion that needs

371
00:21:34,680 --> 00:21:37,560
to be spent on on rehab here
and, and.

372
00:21:37,840 --> 00:21:40,840
That's on top of nearly a
billion already.

373
00:21:40,920 --> 00:21:43,040
Was it?
Yeah, fuck mate.

374
00:21:43,240 --> 00:21:46,800
And The funny thing too is that
2.4 is it's kind of in

375
00:21:47,000 --> 00:21:50,160
discounted real terms.
So if you if you look at the

376
00:21:50,160 --> 00:21:53,280
actual dollars that will need to
be ultimately spend, it's close

377
00:21:53,280 --> 00:21:56,200
to 3 billion.
And and when you when you talk

378
00:21:56,200 --> 00:21:59,120
about Jabaluka getting
developed, like for people that

379
00:21:59,120 --> 00:22:02,560
don't know, there is a fucking
decline that has been excavated

380
00:22:02,560 --> 00:22:05,680
down to the ore body already.
It's been backfilled, but it's

381
00:22:05,680 --> 00:22:09,480
not it.
It was starting to be developed

382
00:22:09,600 --> 00:22:12,600
back in the day, which is very
interesting.

383
00:22:13,120 --> 00:22:15,880
And so ERA they're, they're
running out of money fast doing

384
00:22:15,960 --> 00:22:18,680
this, this rehab in today's
announcement, they say they're

385
00:22:18,680 --> 00:22:22,240
likely to breach their minimum
cash reserve of $50 million in

386
00:22:22,240 --> 00:22:26,160
Q4 this year and then and then
deplete, you know, basically

387
00:22:26,160 --> 00:22:30,000
deplete the cash near the end of
of this year or the start of

388
00:22:30,160 --> 00:22:34,720
next.
So this, this rise was, I guess

389
00:22:34,720 --> 00:22:37,640
it was flagged and everyone knew
it was coming up in whatever

390
00:22:37,640 --> 00:22:41,080
shape or form.
But it's it it, it's a bit

391
00:22:41,080 --> 00:22:44,280
different because everyone just
assumed it it had to be an

392
00:22:44,280 --> 00:22:46,520
entitlement offer as per the
previous ones.

393
00:22:46,880 --> 00:22:50,680
But the trading halt today is
very interesting.

394
00:22:50,680 --> 00:22:52,280
It is right.
It's normally you see a trading

395
00:22:52,280 --> 00:22:54,920
halt and a company's in trading
halt because they've launched a

396
00:22:54,920 --> 00:22:56,920
capital raising.
But today they're in a trading

397
00:22:56,920 --> 00:22:58,480
halt not because they've
launched a capital raising, but

398
00:22:58,480 --> 00:23:01,440
because they're they're
launching a wide base market

399
00:23:01,440 --> 00:23:04,480
sounding to seek interest in
participating at a capital

400
00:23:04,600 --> 00:23:06,160
raising.
They say they're they're going

401
00:23:06,160 --> 00:23:09,160
to need to raise a minimum of
$210 million, but of course they

402
00:23:09,160 --> 00:23:10,640
want more than that.
They've got to spend a lot more

403
00:23:10,640 --> 00:23:12,760
than that over time.
And in reality, like that's

404
00:23:12,760 --> 00:23:15,480
going to be a small drop in the
in the ocean when you think

405
00:23:15,480 --> 00:23:18,240
about the remaining kind of
rehab that's required to be

406
00:23:18,240 --> 00:23:21,000
spent here.
The other really important

407
00:23:21,000 --> 00:23:23,400
dynamic at play here is, is that
of the shareholders.

408
00:23:23,400 --> 00:23:27,480
Rio Tinto has above 86% voting
power in ERA.

409
00:23:27,760 --> 00:23:30,840
The balance is dominated by two
other shareholders being Packer

410
00:23:30,840 --> 00:23:35,120
and Co and Zentry.
And now as as ERA aims to to

411
00:23:35,120 --> 00:23:37,680
raise money.
If, if, if they can't get enough

412
00:23:37,680 --> 00:23:41,160
inbound interest from the the
minorities or new shareholders,

413
00:23:41,440 --> 00:23:45,960
then that that would in effect
see Rio Tinto kind of ending up

414
00:23:45,960 --> 00:23:49,480
with a potentially greater than
90% ownership of ERA.

415
00:23:50,120 --> 00:23:54,160
And if that happens, Rio Tinto
can actually compulsory rarely

416
00:23:54,160 --> 00:23:58,640
acquire ERA at a, you know, at a
price which I'll I'll kind of

417
00:23:58,720 --> 00:24:02,000
discuss a little bit later.
And here's the challenge at play

418
00:24:03,040 --> 00:24:05,200
for for the minority
shareholders, think of Packer

419
00:24:05,200 --> 00:24:07,880
and Cohen's entry.
They either need to stump up a

420
00:24:07,880 --> 00:24:11,520
lot more cash to participate
sort of, you know, pro rata and

421
00:24:11,520 --> 00:24:15,080
prevent Rio Tinto from from
getting to that 90% threshold,

422
00:24:15,320 --> 00:24:19,120
or they need a, you know,
attract others into the mix to

423
00:24:19,120 --> 00:24:22,200
become sort of minority
shareholders alongside them to

424
00:24:22,280 --> 00:24:25,520
to, to ensure that there's some
sort of minority shareholder

425
00:24:25,560 --> 00:24:27,800
hold out preventing the agenda
from getting that 90%.

426
00:24:27,960 --> 00:24:30,200
But attracting others is going
to be difficult because with

427
00:24:30,200 --> 00:24:32,720
Jabber Lucas, you know, mining
lease not renewed.

428
00:24:32,720 --> 00:24:35,400
What's the what's the investment
case here?

429
00:24:35,400 --> 00:24:37,640
It becomes a lot more challenged
and ERA they're they're

430
00:24:37,640 --> 00:24:41,600
embarking on legal proceedings
to contest, you know, this non

431
00:24:41,600 --> 00:24:43,520
renewal.
But but at a minimum, it seems

432
00:24:43,520 --> 00:24:45,120
like a a futile kind of
endeavour.

433
00:24:45,800 --> 00:24:48,440
And there's, there's one more
thing that I think is important

434
00:24:48,440 --> 00:24:50,960
to mention.
Even though the, the assets

435
00:24:51,480 --> 00:24:55,120
might never be developed, Rio
Tinto, they probably have a, a

436
00:24:55,120 --> 00:24:58,720
strong incentive to acquire 100%
of ERA because it lets them kind

437
00:24:58,720 --> 00:25:01,720
of consolidate potential
deferred tax assets or tax

438
00:25:01,720 --> 00:25:05,480
losses, which you know, can can
sort of be useful to the, to the

439
00:25:05,480 --> 00:25:07,880
Headco Rio Tinto.
So, you know, there's an

440
00:25:07,880 --> 00:25:11,280
incentive for Rio to to acquire
100% because of some sort of tax

441
00:25:11,280 --> 00:25:12,200
efficiencies.
Yeah.

442
00:25:12,480 --> 00:25:15,840
And before you get into what
would happen if Rio do get above

443
00:25:15,840 --> 00:25:22,160
90%, how interesting would be
this book build going on at the

444
00:25:22,160 --> 00:25:27,440
moment in terms of if someone
wants to tip in Ari are nearly

445
00:25:27,880 --> 00:25:32,040
the the independent ERI board
are nearly incentivized to make

446
00:25:32,040 --> 00:25:37,160
this as dilutionary as possible
to take as much off Rio Tinto in

447
00:25:37,160 --> 00:25:41,240
in a way, are they like like
because if someone's willing to

448
00:25:41,240 --> 00:25:43,680
tip into this, like the, you
know, the person that wants to

449
00:25:43,680 --> 00:25:45,520
tip in the most usually sets the
price.

450
00:25:45,680 --> 00:25:47,400
Yeah.
Well, like Rio, will will

451
00:25:47,400 --> 00:25:50,040
effectively, yeah, participate
pro rata.

452
00:25:50,040 --> 00:25:52,800
That's kind of a given.
So it's really up to, you know,

453
00:25:52,800 --> 00:25:58,320
non Rio Tinto shareholders to to
come into the mix or participate

454
00:25:58,320 --> 00:26:00,280
pro rata as well.
But you're getting into big, big

455
00:26:00,280 --> 00:26:04,280
dollars for, you know, funds
that aren't as big as Rio Tinto.

456
00:26:04,320 --> 00:26:08,600
So just getting enough money.
If Rio Tinto participates pro

457
00:26:08,600 --> 00:26:11,200
rata and you can't get enough
existing or new money, then in

458
00:26:11,200 --> 00:26:13,480
effect Rio's ownership grows,
doesn't it?

459
00:26:13,680 --> 00:26:16,200
Yeah.
So if they because is there any

460
00:26:16,200 --> 00:26:18,640
like when they're saying the
capital raising like it did it,

461
00:26:18,720 --> 00:26:21,560
it doesn't detail that it is
going to be an entitlement

462
00:26:21,920 --> 00:26:25,320
offer.
No, but I would expect it to be

463
00:26:25,360 --> 00:26:28,400
an entitlement offer.
I think it's yeah, the the most

464
00:26:28,680 --> 00:26:31,840
like, you know, when you're
talking about yeah like a, it's

465
00:26:31,840 --> 00:26:35,120
a $350 million market cap and
they're raising 210 like an

466
00:26:35,120 --> 00:26:38,280
entitlement offer sort of makes
sense because you've got

467
00:26:38,280 --> 00:26:41,000
placement capacity issues and
all the rest, but.

468
00:26:41,080 --> 00:26:43,880
But it'd have to be.
They'd have to be a separate a

469
00:26:43,880 --> 00:26:46,320
separate thing to the
entitlement offer to get the new

470
00:26:46,320 --> 00:26:47,080
people in.
Yeah.

471
00:26:47,240 --> 00:26:50,120
Oh, now it was the last one they
did was a renounceable

472
00:26:50,120 --> 00:26:52,840
entitlement offer, which meant
that, you know, your Packer and

473
00:26:52,840 --> 00:26:57,120
co's could offer some of their
entitlement to other people.

474
00:26:57,120 --> 00:26:59,320
Yeah, but it'll be interested to
see if this one's going to have

475
00:26:59,320 --> 00:27:01,840
an entitlement offer component.
If they're sounding the market,

476
00:27:01,840 --> 00:27:04,800
I assume there's an actual just.
Yeah, a new one.

477
00:27:04,880 --> 00:27:08,800
There's there's a few mechanisms
you can, you can use to, I mean,

478
00:27:08,840 --> 00:27:11,360
you can bolt on a placement with
an entitlement offer to bring in

479
00:27:11,360 --> 00:27:13,840
your institutional money or if
it's renounceable, then you

480
00:27:13,840 --> 00:27:17,120
know, existing shareholders who,
who aren't going to take up

481
00:27:17,120 --> 00:27:20,840
their full entitlement have the
ability to, you know, then yeah,

482
00:27:21,200 --> 00:27:22,680
pass them on to, to new
shareholders.

483
00:27:22,840 --> 00:27:25,520
But like.
And I can go out placement

484
00:27:25,520 --> 00:27:27,560
because then Rio could just say
we'll take the lot.

485
00:27:29,840 --> 00:27:31,520
Yeah.
I mean the yeah, I think a

486
00:27:31,520 --> 00:27:33,280
placement's challenged for a
couple of reasons, placement

487
00:27:33,280 --> 00:27:37,480
capacity, etcetera.
It's it's kind of interesting

488
00:27:37,480 --> 00:27:40,520
though because there's there,
there is a precedent to to talk

489
00:27:40,520 --> 00:27:43,880
about here and I want to talk
about what would happen if, if

490
00:27:43,880 --> 00:27:45,480
Rio emerges with greater than
90%.

491
00:27:45,480 --> 00:27:49,080
If that happens, all Rio Tinto
has to do is logic compulsory

492
00:27:49,080 --> 00:27:53,480
acquisition documents with ASX,
Rio Tinto sets the price right

493
00:27:53,600 --> 00:27:56,560
of that acquisition.
And all like all they have to do

494
00:27:56,560 --> 00:27:58,720
is attach this independent
expert report supporting the

495
00:27:58,720 --> 00:28:01,760
fairness and reasonableness of
the price that they chose.

496
00:28:02,680 --> 00:28:05,440
Earlier this year, there was a a
strikingly similar precedent on

497
00:28:05,440 --> 00:28:07,120
the ASX.
The major shareholder of

498
00:28:07,360 --> 00:28:11,520
Carawine Resources was Q Gold
and that and they found their

499
00:28:11,520 --> 00:28:15,440
way to owning just to slid the
road the 90% of Carawine the way

500
00:28:15,440 --> 00:28:19,080
it happened.
In late 2023, Q Gold owned 88.2%

501
00:28:19,440 --> 00:28:22,600
of Carawine.
In October, Carawine launched a

502
00:28:22,600 --> 00:28:25,840
renounceable entitlements offer.
It wasn't, it wasn't

503
00:28:26,000 --> 00:28:27,960
underwritten, but it was just a
renounced full entitlements

504
00:28:27,960 --> 00:28:30,480
offer.
Q Gold's subscription to that

505
00:28:31,480 --> 00:28:35,760
offer was, was 4.28 million of
the 4.81 million that the

506
00:28:35,760 --> 00:28:38,400
company was raising the
entitlement offer.

507
00:28:38,920 --> 00:28:43,320
And the company like that they
only raised $40,000 from any

508
00:28:43,320 --> 00:28:44,840
other shareholders other than Q
Gold.

509
00:28:44,840 --> 00:28:47,640
So, you know, pretty much people
kind of read the tea leaves and

510
00:28:47,760 --> 00:28:50,200
figured there wasn't much of an
investment case to, to, to tip

511
00:28:50,200 --> 00:28:52,560
in here knowing that there's a
compulsory acquisition on the

512
00:28:52,560 --> 00:28:55,400
way.
And so in effect, on completion

513
00:28:55,400 --> 00:29:00,240
of the entitlement offer, Q Gold
emerged with effectively 90.6%

514
00:29:00,440 --> 00:29:03,400
of Carawine.
And just just over four months

515
00:29:03,520 --> 00:29:06,720
after the completion of that
entitlement offer, so in March

516
00:29:06,720 --> 00:29:10,240
of this year, Hugh Gold, they
lodged its forms to compulsorily

517
00:29:10,240 --> 00:29:13,280
acquire the remainder of
Carawine and they simply set the

518
00:29:13,280 --> 00:29:16,360
exact same price has the rights
issue four months before that

519
00:29:16,400 --> 00:29:18,680
eleven cents a share just.
Backed up by the.

520
00:29:18,800 --> 00:29:22,040
Independent expert report You
know fair, fair and reasonable.

521
00:29:22,240 --> 00:29:26,000
Now when you compulsorily
acquire like this, there's an

522
00:29:26,000 --> 00:29:29,120
objection period where those
minority shareholders they can

523
00:29:29,120 --> 00:29:32,160
object if the if the squeeze out
is is deemed to be unfair.

524
00:29:32,400 --> 00:29:34,760
This happened in the case of of
Q Gold 38.

525
00:29:34,760 --> 00:29:38,280
Shareholders of Caroline have
have objected and but the

526
00:29:38,280 --> 00:29:43,360
Corporations Act Section 664F,
it allows for the acquirer to,

527
00:29:43,360 --> 00:29:46,240
you know, just apply the federal
court for approval of the

528
00:29:46,240 --> 00:29:48,920
compulsory acquisition which
which has happened in the case

529
00:29:48,920 --> 00:29:50,920
of of Caroline too.
That's still playing out.

530
00:29:50,920 --> 00:29:53,280
But you know, there's mechanisms
to still still get it at the

531
00:29:53,280 --> 00:29:54,960
price that you said, even if
there are objections.

532
00:29:55,720 --> 00:29:57,600
So it's still even like they
can.

533
00:29:57,680 --> 00:30:00,320
You're saying the minority
shareholders can object that

534
00:30:00,320 --> 00:30:02,440
they're pretty much got fuck all
chance?

535
00:30:02,440 --> 00:30:05,920
Yeah, maybe if they've got legs
to to to stand on, if if you

536
00:30:05,920 --> 00:30:08,480
know, if it's not fair and not
reasonable that that I think

537
00:30:08,480 --> 00:30:11,480
that's where they they might
have, you know, a leg to stand

538
00:30:11,480 --> 00:30:14,120
on.
But if you think of the dynamic

539
00:30:14,120 --> 00:30:17,120
with with Rio Tinto and ERAI
think a similar thing will

540
00:30:17,280 --> 00:30:20,840
probably happen here.
And the, the price that this,

541
00:30:21,560 --> 00:30:23,640
this, this capital raise that
they're embarking on at the

542
00:30:23,640 --> 00:30:26,880
moment gets done out is pretty
important because I would see

543
00:30:26,880 --> 00:30:31,280
that as the, the base case price
that the minority shareholders

544
00:30:31,360 --> 00:30:35,320
kind of get mopped up for it.
And given this, I imagine it's

545
00:30:35,320 --> 00:30:37,960
going to be like a, a
particularly challenging to

546
00:30:37,960 --> 00:30:40,440
incentivize any new shareholders
to, to participate in the

547
00:30:40,440 --> 00:30:43,720
capital raise too, Because what
you participate, you know, a 40%

548
00:30:43,720 --> 00:30:47,440
discount and then what Rio just
mops up the rest sort of like

549
00:30:47,440 --> 00:30:49,440
six months later at the exact
same price or whatever.

550
00:30:50,240 --> 00:30:53,560
It's a certainty, right?
It's, it's, well, it's, it's, I

551
00:30:53,560 --> 00:30:55,280
think it's downside, but it's
the upside.

552
00:30:55,560 --> 00:30:59,480
You know you're.
Yeah, Sentry, they already

553
00:30:59,720 --> 00:31:02,960
applied to the takeovers panel
before this had even happened.

554
00:31:02,960 --> 00:31:05,760
And the, and the takeovers panel
were like, hang on the the

555
00:31:05,760 --> 00:31:07,880
entitlement.
And yeah, you're like, you know,

556
00:31:07,920 --> 00:31:10,960
you're jumping before the gun.
So yeah, I mean, they've,

557
00:31:10,960 --> 00:31:13,640
they've kind of showed their
hand and they're they're kind of

558
00:31:13,640 --> 00:31:16,480
horrified thinking or knowing
what's going to come, right.

559
00:31:16,520 --> 00:31:19,240
And and when you think of like,
OK, what's the independent

560
00:31:19,240 --> 00:31:24,120
expert actually going to value
ERA at like there's not much you

561
00:31:24,120 --> 00:31:28,680
can build a valuation around
like whatever Rio kind of says

562
00:31:28,680 --> 00:31:32,560
is the price might just be for
the price so.

563
00:31:32,920 --> 00:31:37,800
And look at the spark chart the
like that was up frigging it's

564
00:31:38,000 --> 00:31:40,400
in the ones now.
It was up to bloody like 7 and

565
00:31:40,400 --> 00:31:42,160
stuff.
So like if you're just going off

566
00:31:42,160 --> 00:31:47,120
the last traded price, like far
out should be very, very low

567
00:31:47,120 --> 00:31:48,680
price that this could get done
at.

568
00:31:48,760 --> 00:31:51,560
I don't know if it's going to
work like that, but it's.

569
00:31:52,400 --> 00:31:54,800
Yeah, an independent expert
could make a a pretty good

570
00:31:54,800 --> 00:31:57,080
argument that this is worth
negative money, right?

571
00:31:57,400 --> 00:32:00,960
Like, you've got no leg to stand
on to, right Jabaluka?

572
00:32:00,960 --> 00:32:02,400
And you've got a huge rehab
cost.

573
00:32:02,520 --> 00:32:04,360
Yeah, I think so.
I think the, I think the they'll

574
00:32:04,360 --> 00:32:07,880
be anchoring to the the rights
issue price and like I honestly

575
00:32:07,880 --> 00:32:11,920
just imagine, I'd just imagine
that'll end up being like the

576
00:32:11,920 --> 00:32:15,000
price the minorities get up out.
There's the liquidity event, and

577
00:32:15,000 --> 00:32:17,800
it's not the liquidity event
that anyone wanted, but that'll

578
00:32:18,000 --> 00:32:20,680
that'll just be the way it is.
I think, I think there's a lot,

579
00:32:23,040 --> 00:32:26,080
yeah, bloody politics taking me
by the balls these days.

580
00:32:26,080 --> 00:32:29,800
But it's interesting that this
is on the back of NT out of

581
00:32:29,800 --> 00:32:34,120
freaking huge swing and the
country Liberals just got back

582
00:32:34,120 --> 00:32:36,720
into power.
There's 16 1/2 percent swing

583
00:32:36,720 --> 00:32:39,680
against Labour.
So the government's actually

584
00:32:39,680 --> 00:32:42,800
just changed in NT.
And then the fact that this got

585
00:32:42,800 --> 00:32:46,800
put to the the was it a High
Court appeal or a court appeal

586
00:32:46,800 --> 00:32:52,360
for the Labour's plans to
actually put Jabaluka within the

587
00:32:52,360 --> 00:32:55,400
capital, Kakadu National Park
and lock it away forever?

588
00:32:56,480 --> 00:32:59,560
The fact that this court could
actually delay that from

589
00:32:59,600 --> 00:33:03,320
happening now and with the
upcoming election, I think

590
00:33:03,320 --> 00:33:07,480
there's a lot of this is I say
this is very political about

591
00:33:07,480 --> 00:33:10,640
what is actually going to happen
here because the political

592
00:33:11,240 --> 00:33:13,320
influence over.
Yeah.

593
00:33:13,760 --> 00:33:16,680
How this gets dealt with is very
substantial.

594
00:33:16,680 --> 00:33:18,240
The royalties from the.
Clocks.

595
00:33:18,440 --> 00:33:20,960
Clocks ticking.
Totally, and the royalties from

596
00:33:20,960 --> 00:33:24,080
it if if it ever got developed
would like make a huge

597
00:33:24,080 --> 00:33:26,440
difference to you know, NT's
budget.

598
00:33:26,440 --> 00:33:30,480
Oh shit, shit, yeah, that was
and the you know, the options

599
00:33:30,480 --> 00:33:35,280
that were touted when they, as
you said at the start, when the

600
00:33:35,280 --> 00:33:38,520
pet the power was effectively
taken away from the mirror

601
00:33:38,520 --> 00:33:42,240
people too.
And we saw the the announcement

602
00:33:42,240 --> 00:33:45,920
come out that, you know, boss
were offering a lot looking to

603
00:33:45,920 --> 00:33:49,280
give a free carried interest to
the mirror people for that

604
00:33:49,280 --> 00:33:52,320
project and the royalties
attached to that.

605
00:33:52,320 --> 00:33:55,400
So there's a lot of there's a
lot of play.

606
00:33:55,400 --> 00:33:57,360
This is this is definitely not
over.

607
00:33:58,320 --> 00:34:02,600
Oh, mate, unbelievable.
It's just, it's, I'll have to

608
00:34:02,600 --> 00:34:04,720
look at the actual figures, but
I'll just, you know, everyone's

609
00:34:04,720 --> 00:34:07,560
like Australia's got the biggest
uranium resource in the world,

610
00:34:07,600 --> 00:34:10,760
the percentage of what Jabaluka
and Olympic dam contribute to

611
00:34:10,760 --> 00:34:13,600
that.
Of of saying we've got the.

612
00:34:13,600 --> 00:34:16,880
Biggest uranium resource in the
world because Olympic Dam can

613
00:34:16,960 --> 00:34:23,159
only get out as much as they can
get out and this one is a long

614
00:34:23,159 --> 00:34:25,159
long time away if it would ever
would happen.

615
00:34:25,760 --> 00:34:28,639
So send me through the figures
anyone, if you got them.

616
00:34:29,120 --> 00:34:33,159
I don't think you can call it a.
Resource like in because there's

617
00:34:33,159 --> 00:34:36,679
got to be reasonable grounds for
if it comes part of a National

618
00:34:36,679 --> 00:34:37,840
Park, I think you can't call it
a resource.

619
00:34:37,840 --> 00:34:40,480
No, no, exactly.
Yeah, yeah, exactly.

620
00:34:40,480 --> 00:34:42,719
But I think they're just using
using that as a figure.

621
00:34:42,920 --> 00:34:46,080
Yeah, yeah, good stuff.
Bloody what?

622
00:34:46,560 --> 00:34:49,199
Here's a so for the book build
I've actually got.

623
00:34:49,360 --> 00:34:53,880
I've got an out there idea.
Yeah, this could be so bloody.

624
00:34:53,880 --> 00:34:56,520
Any of the any of the deaths are
listening.

625
00:34:57,040 --> 00:34:59,480
I'd probably this is the phone
call I'll be making.

626
00:35:00,240 --> 00:35:03,000
Cause imagine like considering
all the rehab liability that has

627
00:35:03,000 --> 00:35:06,120
to be done like shit, shit load
of dirt to get moved, moved to

628
00:35:06,120 --> 00:35:08,160
fill the pits in and pit one.
There's two.

629
00:35:08,320 --> 00:35:11,240
Pits to worry about, Pit one is
kind of being backfilled, Pit

630
00:35:11,240 --> 00:35:13,600
three hasn't requires a lot more
backfilling.

631
00:35:13,640 --> 00:35:15,240
Yeah.
So a lot of dirt to me move.

632
00:35:15,240 --> 00:35:20,360
A lot of yellow gear Imagine if
now we know MMS like a good JV

633
00:35:20,640 --> 00:35:23,200
yeah.
So imagine if they did AJV to do

634
00:35:23,200 --> 00:35:29,640
the rehab but then in exchange
for tipping in as a new investor

635
00:35:29,720 --> 00:35:31,760
in ARA as part of the book
build.

636
00:35:32,040 --> 00:35:36,240
So a bit of a move rock for
equity arrangement.

637
00:35:37,720 --> 00:35:40,160
Similar to a drill.
For equity, but now we're moving

638
00:35:40,160 --> 00:35:44,480
rock for equity, mate.
MMS based on what we've seen so

639
00:35:44,480 --> 00:35:47,120
far, I don't think this is out
of the question to get them up

640
00:35:47,120 --> 00:35:50,040
to bloody Jabberoo didn't set up
a bit of an office.

641
00:35:50,040 --> 00:35:53,040
That's a win, win, win because.
They quote what $2.4 billion

642
00:35:53,040 --> 00:35:57,640
rehab remaining if if it was MMS
running the process not reach

643
00:35:57,640 --> 00:36:00,760
into that'll be .4 billion.
Yeah, well, because you think

644
00:36:00,760 --> 00:36:02,760
you're you're.
Doing the equity for rock

645
00:36:02,760 --> 00:36:04,360
moving.
So that's that's slashed a

646
00:36:04,360 --> 00:36:09,520
billion off already effectively
and that's probably not the

647
00:36:09,520 --> 00:36:13,840
dumbest idea.
I think I would not be surprised

648
00:36:13,840 --> 00:36:18,000
if we see MMS pop up on the
register for Ari.

649
00:36:18,480 --> 00:36:23,600
So they're going big J VS for
moving dirt in open to get

650
00:36:23,600 --> 00:36:26,960
people mining or rehabbing is
what MMS do.

651
00:36:27,640 --> 00:36:30,560
Bloody the desk.
Give MMS a call.

652
00:36:32,840 --> 00:36:36,680
I'm a connector JD mate.
You're doing God's work, mate.

653
00:36:37,240 --> 00:36:39,960
Right on, JD.
Get into the bloody all the

654
00:36:39,960 --> 00:36:43,720
dollar signs, mate for the we've
got we've got financial results

655
00:36:43,720 --> 00:36:45,640
all across the board.
We're going to start with you

656
00:36:45,640 --> 00:36:47,640
bloody mates of Pilgrim
Minerals.

657
00:36:47,640 --> 00:36:50,080
They're not your mate.
They're just a company, but just

658
00:36:50,080 --> 00:36:51,480
just a company.
Just just.

659
00:36:51,480 --> 00:36:53,800
A company full year.
Results today, Cobba.

660
00:36:53,800 --> 00:36:55,800
What took you?
What caught your eye?

661
00:36:56,440 --> 00:36:59,320
Yeah, you're dead right, Maddie.
There are some big numbers being

662
00:36:59,320 --> 00:37:02,080
thrown around so that the first
thing that that stood out is the

663
00:37:02,080 --> 00:37:06,760
year on year cash change.
So it was down $1.7 billion to

664
00:37:06,800 --> 00:37:10,360
1.6 billion dollars.
So there's three big players in

665
00:37:10,360 --> 00:37:12,200
that.
You've got a huge tax bill from

666
00:37:12,200 --> 00:37:13,560
the bumper profit the year
before.

667
00:37:14,080 --> 00:37:17,320
You've got a massive amount
spent on CapEx and a little bit

668
00:37:17,320 --> 00:37:20,480
on exploration there as well.
That's a plus $800 million

669
00:37:20,480 --> 00:37:22,800
number.
And then over 400 million in a

670
00:37:22,800 --> 00:37:26,400
dividend that was for the the
period before that came out in

671
00:37:27,160 --> 00:37:30,480
earlier this year.
So the net cash position a

672
00:37:30,480 --> 00:37:34,560
couple ways of looking at it
$1.07 billion if you take in the

673
00:37:34,560 --> 00:37:36,640
the convertible bonds or lease
liabilities, but what they

674
00:37:36,640 --> 00:37:42,240
report is a 1.26 billion net
cash position, geez that the

675
00:37:42,240 --> 00:37:43,760
taxes are.
Rude, isn't it, JD?

676
00:37:44,440 --> 00:37:45,680
Oh, it's horrible.
It just.

677
00:37:45,760 --> 00:37:47,760
Kills business, doesn't it?
They want their.

678
00:37:47,760 --> 00:37:50,640
Pound to flesh this government
far out they do.

679
00:37:50,640 --> 00:37:51,800
They'll do a task.
Too.

680
00:37:52,680 --> 00:37:53,880
Oh.
We best.

681
00:37:53,880 --> 00:37:55,560
Not get started on this mate,
we'll just get you.

682
00:37:55,600 --> 00:37:58,320
I just get angry.
So the.

683
00:37:58,720 --> 00:38:01,120
The next thing that really stood
out is what happened to

684
00:38:01,120 --> 00:38:06,120
underlying impacts.
That was a 86% fall to a $318

685
00:38:06,120 --> 00:38:08,600
million profit.
Now obviously no surprises.

686
00:38:08,600 --> 00:38:11,320
We've gone from a period where,
you know, prices were just

687
00:38:11,320 --> 00:38:14,040
insanely great to pretty grim.
That all happened pretty

688
00:38:14,040 --> 00:38:16,280
quickly.
And for those wondering, you

689
00:38:16,280 --> 00:38:18,720
know, if you're not from a sort
of financial bent, maybe from a

690
00:38:18,960 --> 00:38:22,360
operational time per background,
the net profit we're talking

691
00:38:22,360 --> 00:38:25,160
about here, that's a, an
accounting construct.

692
00:38:25,160 --> 00:38:28,640
So it doesn't reflect the actual
cash change in the business.

693
00:38:29,160 --> 00:38:32,520
Only a portion of the CapEx is
captured in that, you know, in

694
00:38:32,520 --> 00:38:35,080
the income statement through
depreciation, amortisation

695
00:38:35,080 --> 00:38:37,160
there.
Hence you can have a a $300

696
00:38:37,160 --> 00:38:42,040
million profit, but the actual
cash change goes from 3 billion

697
00:38:42,040 --> 00:38:45,800
to 1.3 billion net cash.
Very, very good ex.

698
00:38:46,120 --> 00:38:48,640
Explanation there, JD.
Thank you, Matt.

699
00:38:48,880 --> 00:38:49,800
One more.
On.

700
00:38:51,880 --> 00:38:55,080
One more to.
Round out on the earnings side

701
00:38:55,080 --> 00:38:57,720
of thing and I think it's all
like one we can kind of chat

702
00:38:57,720 --> 00:39:00,480
about and think about.
So their average selling price

703
00:39:00,480 --> 00:39:05,640
was US 1176 bucks a tonne.
They're putting out five point

704
00:39:05,640 --> 00:39:10,280
2% product into the market.
So obviously that's pretty much

705
00:39:10,280 --> 00:39:14,760
gone on a line straight down
from June 30 last year to June

706
00:39:14,760 --> 00:39:17,200
30 this year.
And the thoughts of what that

707
00:39:17,200 --> 00:39:20,040
kind of looks like at US 700
bucks a tonne, which is, you

708
00:39:20,040 --> 00:39:23,200
know, close to what they're
probably earning is it's a bit

709
00:39:23,200 --> 00:39:26,680
concerning, right.
I think the, the, the writing's

710
00:39:26,680 --> 00:39:27,880
a bit on the wall and it'll be
interesting.

711
00:39:27,880 --> 00:39:30,320
I'll get into it a bit later on,
what the kind of consensus

712
00:39:30,320 --> 00:39:33,880
expectations are around your,
your operational earnings for

713
00:39:33,880 --> 00:39:36,120
the year going forward and
beyond that, because there's

714
00:39:36,120 --> 00:39:39,600
still a heap of CapEx to go out
over the the coming period

715
00:39:39,880 --> 00:39:44,320
extremely first half.
Wided that number, yeah, I mean

716
00:39:44,320 --> 00:39:46,880
well.
The, the, the operations are

717
00:39:46,880 --> 00:39:47,880
getting bigger and bigger,
right?

718
00:39:47,880 --> 00:39:50,680
They had, they had a bumper Q4
so that the tonnes are getting

719
00:39:50,680 --> 00:39:52,280
bigger.
You haven't actually seen the

720
00:39:52,280 --> 00:39:54,920
operating costs kind of come
down enough.

721
00:39:54,920 --> 00:39:56,800
But yeah, I mean, we'll, we'll
get into it.

722
00:39:56,800 --> 00:40:00,000
I want to touch on the, the, the
kind of big news that we saw on

723
00:40:00,000 --> 00:40:03,200
the, the financial front is the
new debt facility, so $1 billion

724
00:40:03,200 --> 00:40:06,040
debt facility, which they don't
totally need.

725
00:40:06,040 --> 00:40:08,320
You know, they've got 360
million in debt that's from a

726
00:40:08,440 --> 00:40:12,720
government and a syndicated.
Debt facility, but they're a bit

727
00:40:12,720 --> 00:40:14,840
more restrictive.
So what they're essentially

728
00:40:14,840 --> 00:40:16,200
going to do is just pay them
down.

729
00:40:16,400 --> 00:40:19,200
They'll have this 1 billion, it
might save them.

730
00:40:19,280 --> 00:40:22,800
I'm, I'm sort of estimating here
$15 million a year going off

731
00:40:22,800 --> 00:40:24,440
numbers they threw around on the
call.

732
00:40:24,680 --> 00:40:26,880
But the, the key takeaways that
they've got much more

733
00:40:26,880 --> 00:40:29,320
flexibility here.
So this is going to take into

734
00:40:29,320 --> 00:40:32,720
account their net debt and the
previous debt was taking into

735
00:40:32,720 --> 00:40:35,480
account their gross debt.
So you're at an advantage when

736
00:40:35,480 --> 00:40:38,000
you're in a $1.6 billion cash
position.

737
00:40:38,480 --> 00:40:41,000
You're not going to be, you
know, crimped as hard on, on the

738
00:40:41,000 --> 00:40:43,520
sides when your earnings might
not be what they were.

739
00:40:43,520 --> 00:40:46,120
And then, yeah, leverage ratios
go all out of whack.

740
00:40:46,480 --> 00:40:49,160
And interestingly, they, they
got asked the question on growth

741
00:40:49,240 --> 00:40:52,680
again and they're, they're not
denying it like I would have

742
00:40:52,680 --> 00:40:54,760
thought after the Latin
acquisition, they say, hey,

743
00:40:54,840 --> 00:40:59,040
we're, we're not going to use
this to do any more MNA in, in

744
00:40:59,040 --> 00:41:01,440
the shorter medium term.
But this is now the kind of

745
00:41:01,440 --> 00:41:04,000
second opportunity they've had
to say that And they didn't

746
00:41:04,000 --> 00:41:06,040
actually say it.
They're like, yeah, we, we

747
00:41:06,040 --> 00:41:08,360
could, it's not our priority,
but it's an option.

748
00:41:08,360 --> 00:41:10,480
So I think just the, the
language and how they're

749
00:41:10,480 --> 00:41:13,080
speaking about that is it's
pretty interesting.

750
00:41:13,160 --> 00:41:15,600
Well, the the fact they're.
Getting a $1 billion debt

751
00:41:15,600 --> 00:41:21,000
facility on after doing an all
script proposal to Latin is

752
00:41:21,400 --> 00:41:24,560
pretty fucking be pretty
confident they're keeping

753
00:41:24,600 --> 00:41:28,080
options open to potentially
deploy it if something arises.

754
00:41:29,240 --> 00:41:31,720
Yeah, I think so.
And I, I think it's, it's the

755
00:41:31,720 --> 00:41:34,640
right thing to do in the in the
kind of evolution of the

756
00:41:34,640 --> 00:41:37,960
business as they go away from
the the debt facilities that got

757
00:41:37,960 --> 00:41:40,480
them online and got them to a
company that that's producing to

758
00:41:40,480 --> 00:41:43,400
a more corporate type debt
facility that you can see with a

759
00:41:43,720 --> 00:41:45,080
company that has a bit more
options.

760
00:41:45,080 --> 00:41:48,000
And then they progress to earn a
company with a couple

761
00:41:48,000 --> 00:41:50,240
operations.
It's kind of that that natural

762
00:41:50,240 --> 00:41:53,240
progression of a company as it
grows, I think looking at like.

763
00:41:53,480 --> 00:41:57,120
You know, I know we talked about
Sigma in the last one and you

764
00:41:57,120 --> 00:42:00,800
draw parallels to to Lyontown in
a way.

765
00:42:00,800 --> 00:42:03,720
I think Sigma's about 15 bucks
at the moment.

766
00:42:03,720 --> 00:42:09,120
Share price was up near 50.
And you know, when they were

767
00:42:09,120 --> 00:42:12,320
trying to sell, like, I don't
know if they were getting offers

768
00:42:12,320 --> 00:42:16,720
around that 50 bucks worth.
But now back at 15, Lyontown

769
00:42:16,840 --> 00:42:20,800
were getting offers from
Albemarle in the low twos that

770
00:42:20,800 --> 00:42:23,480
they were knocking back,
obviously went up to three.

771
00:42:23,480 --> 00:42:26,160
And then it all nothing happened
because Gina got involved.

772
00:42:26,520 --> 00:42:31,160
But Lontown sitting at the
$0.80, I reckon they'd take an

773
00:42:31,160 --> 00:42:35,400
offer at 2 bucks right now.
And you would imagine Sigma

774
00:42:35,400 --> 00:42:40,840
sitting at 15, they'd probably
take an offer at 30 that it'd

775
00:42:40,840 --> 00:42:42,680
be, It's just, I think things
have changed.

776
00:42:42,680 --> 00:42:46,240
It'd be, I don't know, Yeah,
interesting to see how the

777
00:42:46,240 --> 00:42:48,400
mindsets have changed by the
deal makers.

778
00:42:48,680 --> 00:42:50,920
But would would.
Lontown.

779
00:42:50,920 --> 00:42:56,120
Even if everyone other than Gina
would accept $2.00 with Gina,

780
00:42:56,160 --> 00:42:57,680
she paid 3, remember?
Yeah.

781
00:42:57,680 --> 00:42:58,920
So you can't get a deal done
with that.

782
00:42:58,960 --> 00:43:02,560
Yeah, exactly.
Yeah, I think you spot on.

783
00:43:02,560 --> 00:43:04,280
It's also.
Interesting to to reflect back

784
00:43:04,280 --> 00:43:07,240
to that time.
I'm just going off memory here,

785
00:43:07,240 --> 00:43:11,000
but I feel like Albemarle when
we sort of back solved it was US

786
00:43:11,000 --> 00:43:17,760
1900 long term SE6 spot price.
And now I mean I saw a number

787
00:43:17,760 --> 00:43:20,840
being thrown around early today
and backing out the valuation on

788
00:43:20,840 --> 00:43:22,440
Pilbara, we're talking about
1200.

789
00:43:22,680 --> 00:43:24,800
So it's interesting you have
these people as close to the

790
00:43:24,800 --> 00:43:29,880
market as anyone and in in less
than a year the the forecast and

791
00:43:29,880 --> 00:43:31,640
the commodity.
I think it just underlines how

792
00:43:31,640 --> 00:43:34,120
hard predicting commodity prices
is.

793
00:43:34,360 --> 00:43:37,960
You get the people as close to
it as anyone in the world and

794
00:43:37,960 --> 00:43:40,120
you can have a variance that big
in less than a year.

795
00:43:40,120 --> 00:43:41,920
It's it's just something
interesting to observe,

796
00:43:41,920 --> 00:43:45,040
especially in.
Commodities or chemicals there,

797
00:43:45,040 --> 00:43:47,240
if you want to call it.
They're very early in their life

798
00:43:47,240 --> 00:43:50,520
cycle.
Yeah, friggin possible to

799
00:43:50,520 --> 00:43:52,240
predict the thing I'm.
I'm like.

800
00:43:52,240 --> 00:43:55,000
When you talk about Lion Town
too, Maddie like the one.

801
00:43:55,240 --> 00:43:58,240
The one change of control
scenario, I wouldn't kind of put

802
00:43:58,240 --> 00:44:02,000
a line through is, is simply
like, yeah, a, a, a JV

803
00:44:02,000 --> 00:44:04,080
acquisition with Gina kind of
similar to you so with, with

804
00:44:04,160 --> 00:44:06,240
Azure.
But you know, yeah, if, if, if

805
00:44:06,240 --> 00:44:09,840
Pilgrim and Gina did AJV and
collectively loved a bid, you

806
00:44:09,840 --> 00:44:12,560
know, you know that, then you
could understand why they've got

807
00:44:12,560 --> 00:44:14,880
a debt facility as well.
Because and, but wouldn't.

808
00:44:14,880 --> 00:44:17,880
You wouldn't you think that that
is what's going to happen with

809
00:44:18,000 --> 00:44:21,240
Gina anyway because Hancock
would not want to be the

810
00:44:21,240 --> 00:44:23,440
operator?
Yeah, I.

811
00:44:24,040 --> 00:44:26,200
I would have thought so you're
basically pegging your ground

812
00:44:26,200 --> 00:44:29,360
and saying, look, if you want to
do AJV with me, like happy to

813
00:44:29,640 --> 00:44:31,280
like you're going to have to,
you're going to have to.

814
00:44:31,280 --> 00:44:33,080
So yeah, yeah, yeah, that
that's.

815
00:44:33,760 --> 00:44:36,720
Sounds like a lot more realistic
than it would be that Yeah,

816
00:44:37,560 --> 00:44:38,960
yeah, I mean they'd.
They'd bring the.

817
00:44:38,960 --> 00:44:41,160
Cash they could.
That's definitely happening now.

818
00:44:43,560 --> 00:44:46,080
So I think it's.
It's interesting to look at

819
00:44:46,080 --> 00:44:48,080
these lithium companies because
you talk about how much they get

820
00:44:48,080 --> 00:44:51,640
beaten up, Maddie, about how
they might be open to a takeover

821
00:44:51,640 --> 00:44:55,320
at a way lower multiple or
whatever to what we were talking

822
00:44:55,320 --> 00:44:57,360
about last year.
And you, you look at the

823
00:44:57,360 --> 00:45:01,520
earnings for Pilbara and going
off visible outfit consensus,

824
00:45:01,920 --> 00:45:05,240
we're talking about operating
cash flow of 420 million.

825
00:45:05,560 --> 00:45:11,280
The Pilbara for the FY25 period
now use a a midpoint of 820,000

826
00:45:11,280 --> 00:45:13,360
tonnes, which is what they've
they've guided to.

827
00:45:14,280 --> 00:45:18,680
You're assuming a margin of US
350 bucks a tonne there.

828
00:45:18,960 --> 00:45:21,720
So back of the envelope to kind
of achieve this, you need

829
00:45:22,000 --> 00:45:27,320
lithium prices to jump 3540%
from where we are today and kind

830
00:45:27,320 --> 00:45:30,280
of hold, hold that for the, the
period which we're already a

831
00:45:30,280 --> 00:45:33,160
couple months into.
You know, and you know, you

832
00:45:33,160 --> 00:45:36,080
think about their, their cash
cost they've going off last year

833
00:45:36,080 --> 00:45:40,920
and what they've kind of guided
a bit over US500I mean, the

834
00:45:41,080 --> 00:45:45,680
where we are right now, what I
saw this morning was 770 for 6%

835
00:45:45,680 --> 00:45:48,440
grade.
So what is that kind of 700 ish

836
00:45:48,440 --> 00:45:53,280
for a 5.2% product?
It's yeah, it, it, it's not

837
00:45:53,280 --> 00:45:56,160
going to be a, a very cash
generative next year for the

838
00:45:56,160 --> 00:45:58,960
company because he's still got
roughly 700 million going out

839
00:45:58,960 --> 00:46:01,480
the door in CapEx.
That cash position is going to

840
00:46:01,480 --> 00:46:04,040
fall substantially again over
the next year.

841
00:46:04,520 --> 00:46:07,320
I'll be.
When you're talking about the

842
00:46:07,320 --> 00:46:12,520
the price jump and you know what
catalysts and I'm keen to say

843
00:46:12,520 --> 00:46:14,760
what me and Holland's doing
because their full year results

844
00:46:14,760 --> 00:46:18,240
will be out soon and a bit of
bit of colour on on them because

845
00:46:18,240 --> 00:46:20,480
they're you think of what's
going to change.

846
00:46:20,480 --> 00:46:24,520
It's like, you know, low, low
prices queue a low prices and

847
00:46:24,880 --> 00:46:27,440
whether one how that operations
going.

848
00:46:28,160 --> 00:46:32,000
We don't he had a bit of an
indication before Min Reza's

849
00:46:32,000 --> 00:46:36,520
operations like you know, is
Mount Marion's bloody 4% spot

850
00:46:36,520 --> 00:46:39,320
still going to be getting sold
Like we're just there's a lot of

851
00:46:39,320 --> 00:46:43,760
questions about, you know, pill
pill Gangora is still gone.

852
00:46:43,840 --> 00:46:46,280
Doesn't look like it's going to
ever get a bloody stop, but it's

853
00:46:46,280 --> 00:46:50,240
when other ones, what's going on
with all of them is going to

854
00:46:50,240 --> 00:46:52,600
give a good gauge.
I think so, yeah, definitely.

855
00:46:52,600 --> 00:46:54,320
I think, I think Wesley.
'S come out with their annual

856
00:46:54,320 --> 00:46:57,280
results on Thursday, I think so
hopefully we can get a bit of a

857
00:46:57,280 --> 00:46:59,200
read.
But we've said it, you know,

858
00:46:59,200 --> 00:47:01,400
we've said it once, twice, three
times, like a lot of these guys

859
00:47:01,400 --> 00:47:02,760
still aren't really cutting
back.

860
00:47:03,080 --> 00:47:06,640
So we're not really at that
point where the low prices are

861
00:47:07,080 --> 00:47:08,400
having the effect that they
should.

862
00:47:08,400 --> 00:47:11,200
I think that's going to take a a
little while longer to kind of

863
00:47:11,720 --> 00:47:13,480
run through.
And I'll just finish up with

864
00:47:13,480 --> 00:47:17,600
this one chart that I've saw in
AJP Morgan email This morning.

865
00:47:17,600 --> 00:47:19,760
They checked it out in their
research and they were running

866
00:47:19,760 --> 00:47:22,200
spot numbers through all the
major miners.

867
00:47:22,200 --> 00:47:25,360
So not just lithium players, but
you've got iron ore players,

868
00:47:25,360 --> 00:47:29,680
you've got kind of diversified
miners, gold miners and a few

869
00:47:29,680 --> 00:47:33,240
other in there.
And you can see the, the price

870
00:47:33,240 --> 00:47:39,840
to MPV at spot is 6.21 times it.
It, you know, flashing through

871
00:47:39,840 --> 00:47:43,680
spot has a bigger impact on
Pilbara than any other company

872
00:47:43,680 --> 00:47:46,600
that they threw up in this
analysis by quite some margins.

873
00:47:46,600 --> 00:47:49,720
I think it's, it's quite
interesting to put that into

874
00:47:49,720 --> 00:47:51,800
perspective and think about
this, you know, quote unquote

875
00:47:51,800 --> 00:47:58,000
premium valuation that that
Pilbara gets and you know, it's,

876
00:47:58,040 --> 00:47:59,280
it's still not been shipped
away.

877
00:47:59,280 --> 00:48:04,040
We talk about how grim it is for
lithium miners out there, but I

878
00:48:04,040 --> 00:48:06,640
don't think you've got a massive
margin of safety if you're if

879
00:48:06,640 --> 00:48:09,360
you're going in and buying these
sorts of names, given the the

880
00:48:09,360 --> 00:48:11,280
kind of multiples they're
trading on at the moment.

881
00:48:11,560 --> 00:48:12,720
Yeah, Yeah.
And.

882
00:48:12,760 --> 00:48:16,240
Look, we've talked the big thing
because of their expansion is,

883
00:48:16,240 --> 00:48:18,920
you know, getting unit costs
down trying to survive this

884
00:48:18,920 --> 00:48:23,040
period as you said, when low
prices supposedly going to cure

885
00:48:23,040 --> 00:48:26,360
low prices a lot.
The parallel analogy to that is,

886
00:48:26,880 --> 00:48:31,120
is if you've got Silverstone,
you get more Silverstone.

887
00:48:31,280 --> 00:48:34,160
Like that's, that's a, that's
another bloody thing that

888
00:48:34,160 --> 00:48:37,000
probably Pilbara have got.
They were pretty much got into

889
00:48:37,000 --> 00:48:37,560
the.
Call today.

890
00:48:37,920 --> 00:48:39,440
Yeah, they've got a bullet in
the chamber.

891
00:48:39,440 --> 00:48:42,080
There because Silverstone are
already up there so more

892
00:48:42,080 --> 00:48:46,040
Silverstone will cure our prices
as as well.

893
00:48:46,320 --> 00:48:47,920
So I think I think get the
whole.

894
00:48:47,920 --> 00:48:51,240
Team up there.
Just deploy all of Silverstone

895
00:48:51,480 --> 00:48:54,720
to Pilgangora and right, that's
a lot.

896
00:48:54,720 --> 00:48:57,520
Pretty much like 500 bucks a
tonne on the spot price.

897
00:48:58,800 --> 00:49:00,080
They'll be beating those
consensus.

898
00:49:00,080 --> 00:49:02,320
Numbers I was talking about just
before, get them to do

899
00:49:02,320 --> 00:49:03,680
everything.
I mean, there's a lot going up

900
00:49:03,760 --> 00:49:06,960
on up there right now.
They got P-1000, which should be

901
00:49:07,120 --> 00:49:09,640
humming in, you know, 3/4 of a
year.

902
00:49:09,800 --> 00:49:12,440
You want to get there smoothly,
Silverstone, get them on the

903
00:49:12,440 --> 00:49:14,080
job.
Oh mate, the bloody and.

904
00:49:14,120 --> 00:49:16,960
Mate, the emissions intensity as
well like you can, you can save

905
00:49:16,960 --> 00:49:18,720
money.
Tick the bloody green boxes.

906
00:49:18,960 --> 00:49:22,560
Bloody Silverstone solar farm,
Silverstone bloody hybrid power

907
00:49:22,560 --> 00:49:25,520
stations, bloody just
Silverstone survivors,

908
00:49:25,600 --> 00:49:28,480
Silverstone water supply.
Just fuck me.

909
00:49:28,600 --> 00:49:32,120
It's just Silverstone galore.
Up the buses, the EV.

910
00:49:32,200 --> 00:49:33,480
Buses mate.
All Silverstone.

911
00:49:33,480 --> 00:49:35,560
Yeah, Silverstone helps produce
White Rock.

912
00:49:36,320 --> 00:49:38,760
Exactly.
Chuck it on your logo cycles.

913
00:49:39,000 --> 00:49:40,240
Chuck it on.
Your logo More.

914
00:49:40,240 --> 00:49:43,560
Silverstone cures less
Silverstone, you'd say.

915
00:49:44,400 --> 00:49:45,200
You wanna?
You wanna?

916
00:49:45,200 --> 00:49:48,800
Last through this lithium rot
get Silverstone on Don't don't

917
00:49:48,800 --> 00:49:51,000
under don't.
Don't have not as much

918
00:49:51,000 --> 00:49:53,960
Silverstone as you need.
You can never have enough, right

919
00:49:53,960 --> 00:49:56,240
JD?
Who's on the divvies, mate?

920
00:49:57,600 --> 00:50:00,480
I'll try commiserations on your
Yankel Divvy, by the way.

921
00:50:00,480 --> 00:50:04,960
Yes, sorry about that.
So these ones are.

922
00:50:05,600 --> 00:50:08,680
Just from today, so a couple
divvies and a couple capital

923
00:50:08,680 --> 00:50:11,560
returns.
So Remelius one that stood out

924
00:50:11,560 --> 00:50:15,560
there paying a record $0.05
divvy, no kind of secret.

925
00:50:15,560 --> 00:50:17,240
You look at the earnings, they
were really strong.

926
00:50:17,240 --> 00:50:20,440
They're very cash generative
because of what's going on at at

927
00:50:20,440 --> 00:50:24,440
Edna May taking 2 1/2 percent.
Divvy, That's not bad for a

928
00:50:24,440 --> 00:50:27,040
bloody Yeah, I think they were
two.

929
00:50:27,040 --> 00:50:30,360
Bucks eight cents last time I
looked yeah spot on Hillbro

930
00:50:30,360 --> 00:50:33,120
notable that they're not paying
a dividend that's not

931
00:50:33,120 --> 00:50:35,360
surprising.
They did update their Capital

932
00:50:35,360 --> 00:50:38,120
Management framework and it's
you know, it's based on a free

933
00:50:38,120 --> 00:50:41,880
cash flow.
It's based on free cash flow so

934
00:50:41,880 --> 00:50:44,760
no surprises that they're not
paying out any dividends.

935
00:50:45,000 --> 00:50:48,280
Gold Rd they've they've had a a
pretty torrid time of it lately.

936
00:50:48,280 --> 00:50:50,520
They're paying out a half a cent
dividend.

937
00:50:50,520 --> 00:50:53,120
They made under 5 million in
free cash flow.

938
00:50:53,120 --> 00:50:55,520
So disappe pointing kind of all
around.

939
00:50:55,520 --> 00:50:59,120
They've had weather and all
sorts of other disruptions

940
00:50:59,120 --> 00:51:02,040
there.
Standwell's another one US 4.4

941
00:51:02,040 --> 00:51:03,880
cents that they're paying out in
a divvy.

942
00:51:03,880 --> 00:51:06,720
I noticed they also restructured
their debt.

943
00:51:06,720 --> 00:51:08,760
So things are kind of moving in
the right direction.

944
00:51:09,240 --> 00:51:12,040
You got base resources.
They're still under takeover

945
00:51:12,040 --> 00:51:15,000
from energy fuels.
That's, you know, jiggling on in

946
00:51:15,000 --> 00:51:16,760
the in the background.
They're paying out six and a

947
00:51:16,760 --> 00:51:20,560
half cent special TV that was
spoken about a long time ago

948
00:51:20,560 --> 00:51:24,320
when the the takeover first came
forth and Meadows XI think we

949
00:51:24,320 --> 00:51:27,800
got a Ding, Ding, Ding here for
Mr Ricardino.

950
00:51:28,160 --> 00:51:31,400
They've actually got busy on the
on the buyback again, which is

951
00:51:31,440 --> 00:51:35,760
good to say 550, 1000 shares
roughly were bought back.

952
00:51:35,960 --> 00:51:38,360
And what stood out is that they
were doing this at a a higher

953
00:51:38,360 --> 00:51:41,080
price to what they'd previously
paid up to $0.40.

954
00:51:41,200 --> 00:51:42,840
Yeah.
Yeah, exactly.

955
00:51:42,840 --> 00:51:45,360
Up to 40.
Cents so I mean it's it's 220

956
00:51:45,360 --> 00:51:47,440
grand.
It's a a drop in the ocean of

957
00:51:47,440 --> 00:51:48,680
all the cash that they've still
got.

958
00:51:48,680 --> 00:51:50,560
But that was just one day's
work.

959
00:51:50,560 --> 00:51:53,520
So good to see.
And then lastly, you got

960
00:51:53,640 --> 00:51:55,760
Parenti.
They they keep churning away.

961
00:51:55,960 --> 00:52:00,240
They spent 650 grand buying back
680,000 shares.

962
00:52:00,240 --> 00:52:03,160
That's a a programme that's been
underway for a little while.

963
00:52:03,160 --> 00:52:06,360
So good to see some of the the
miners and mining services

964
00:52:06,360 --> 00:52:09,360
companies actually give a bit of
cash back to the investors out

965
00:52:09,360 --> 00:52:10,760
there.
Try it for you bloody.

966
00:52:11,160 --> 00:52:13,320
There was plenty of people that
were devastated.

967
00:52:13,320 --> 00:52:15,480
You weren't here for the for the
Yancarl thing.

968
00:52:15,480 --> 00:52:18,160
Did you want to give a bit of a
recap a week later 'cause people

969
00:52:18,160 --> 00:52:21,160
were wanting to hear your
opinion on what actually I

970
00:52:21,440 --> 00:52:24,800
thought Jay did?
A really fair, yeah, summary of

971
00:52:24,920 --> 00:52:25,880
of it all.
Yeah.

972
00:52:26,000 --> 00:52:29,680
I mean, yeah, I, I don't have
too much to add other then like

973
00:52:29,680 --> 00:52:31,920
it's pretty, it's just, it's
pretty interesting observation

974
00:52:31,920 --> 00:52:36,360
to just say when you kind of
have really, really wild kind of

975
00:52:36,360 --> 00:52:39,320
intraday movement and it's a
readjustment in, in shareholder

976
00:52:39,320 --> 00:52:41,280
expectations.
You kind of a lot of people

977
00:52:41,280 --> 00:52:43,320
owning it for the yield.
Now that yield looks

978
00:52:43,320 --> 00:52:45,760
jeopardised.
And so it's kind of like the

979
00:52:45,760 --> 00:52:48,040
yield investors rotate out and
you've got to sort of

980
00:52:48,360 --> 00:52:50,960
incentivize the the growth
investors to kind of come into

981
00:52:50,960 --> 00:52:52,880
it.
And and heck, you saw like a 20%

982
00:52:52,880 --> 00:52:55,760
intraday movement in a, in a
bloody $8 billion company.

983
00:52:55,760 --> 00:52:59,000
That's pretty, a pretty wild
thing, but you know, it's, it's

984
00:52:59,000 --> 00:53:01,680
not like the, the cash
evaporated, but the, the huge

985
00:53:01,680 --> 00:53:04,680
risk with them has always just
been that do you trust this

986
00:53:04,680 --> 00:53:07,000
management team that this
shareholder group dynamic to

987
00:53:07,000 --> 00:53:10,240
actually make make me as a
shareholder a beneficiary of,

988
00:53:10,320 --> 00:53:14,240
of, of that cash?
And like that, that, that

989
00:53:14,240 --> 00:53:16,120
question continues to be
uncertain.

990
00:53:16,120 --> 00:53:19,640
They've they've, they've paid
dividends at, you know, at

991
00:53:19,640 --> 00:53:22,000
points in their life and, you
know, they've definitely had

992
00:53:22,000 --> 00:53:24,720
periods where the dividends have
been lower than expectations.

993
00:53:24,720 --> 00:53:29,240
But yeah, it's also having said
that, like it's not a terrible

994
00:53:29,240 --> 00:53:33,560
time in the, in, in the, in the
scheme of things to actually be

995
00:53:33,560 --> 00:53:35,240
acquiring some of these these
assets.

996
00:53:35,240 --> 00:53:36,760
You can probably get them at a
pretty low multiple.

997
00:53:36,760 --> 00:53:40,000
And like, you know, I'm a
believer that these phenomenal

998
00:53:40,000 --> 00:53:42,880
assets will kind of command a
multiple rewrite, rewrite over

999
00:53:42,880 --> 00:53:43,760
time too.
Yeah.

1000
00:53:43,760 --> 00:53:47,040
No, because I think what?
We said about and it's

1001
00:53:47,040 --> 00:53:50,160
interesting you say that is like
when will the sign look they're

1002
00:53:50,160 --> 00:53:53,320
gonna there's gonna be obviously
a lot of competition for these

1003
00:53:53,320 --> 00:53:56,320
assets in the sales process, but
there's a lot of competition

1004
00:53:56,320 --> 00:53:58,680
Adelaide multiple MM hmm.
So it's all there's sort of the

1005
00:53:58,680 --> 00:54:01,080
trades each other off a bit in a
way.

1006
00:54:01,440 --> 00:54:02,720
Yeah, I don't, I don't think
the.

1007
00:54:02,720 --> 00:54:07,000
Competition will be as like,
yeah, I I don't think it'll be

1008
00:54:07,000 --> 00:54:09,400
as pronounced as sort of most
sales processes you see out

1009
00:54:09,400 --> 00:54:11,720
there.
It's like good assets 1 needs a

1010
00:54:11,720 --> 00:54:15,800
lot of money to kind of get back
producing, you know, White Haven

1011
00:54:15,800 --> 00:54:17,240
said we're not bidding for it
already.

1012
00:54:17,240 --> 00:54:19,760
So, you know, like they'll
they'll be competition like

1013
00:54:19,800 --> 00:54:22,480
Glencorp will will compete, but
they won't overpay.

1014
00:54:22,840 --> 00:54:26,080
So, you know, like who's the
most likely to overpay?

1015
00:54:26,080 --> 00:54:29,080
Probably ankle, to be honest.
But but even if they overpay

1016
00:54:29,080 --> 00:54:32,080
just enough to get the deal
done, it's probably still the

1017
00:54:32,080 --> 00:54:34,280
Anglo assets, yeah.
It'll probably still be.

1018
00:54:34,400 --> 00:54:37,200
Decent, kind of a decent
acquisition in the context of

1019
00:54:37,200 --> 00:54:39,360
things broadly, yeah.
Is there anything else up for

1020
00:54:39,360 --> 00:54:41,120
sale?
Potential.

1021
00:54:41,120 --> 00:54:42,640
Oh, probably.
Probably.

1022
00:54:42,760 --> 00:54:44,880
Yeah, I mean, we, we didn't
exactly.

1023
00:54:44,880 --> 00:54:48,160
Know it wasn't widely reported
that the Illawarra assets were

1024
00:54:48,160 --> 00:54:50,600
and then that just kind of
popped up right that wasn't

1025
00:54:51,200 --> 00:54:52,920
commonly held.
So there's there are other

1026
00:54:52,920 --> 00:54:55,480
assets around there that might
be a bit off our radar.

1027
00:54:55,480 --> 00:54:57,880
I'd say that could all of a
sudden pop out.

1028
00:54:58,240 --> 00:55:03,120
Where's hags when you know deep?
He'd be in the know, yeah.

1029
00:55:03,120 --> 00:55:05,440
Cheers for the.
Cheers for the support hags on

1030
00:55:05,440 --> 00:55:07,040
Twitter.
He's like a like a bit of biky

1031
00:55:07,040 --> 00:55:09,200
support behind me.
It's a bit of muscle.

1032
00:55:09,720 --> 00:55:11,520
Good on your hags looking after
me.

1033
00:55:12,080 --> 00:55:15,120
Oh fucking it's these aren't
access modern technology looking

1034
00:55:15,120 --> 00:55:17,080
after us.
Good on you and.

1035
00:55:17,080 --> 00:55:19,480
Everyone else.
How many, How much more of the

1036
00:55:19,480 --> 00:55:22,600
fucking world do they need to
look after the bloody gurus of

1037
00:55:22,600 --> 00:55:24,520
drill Isle survey
instrumentation?

1038
00:55:24,680 --> 00:55:28,320
Get them in your business as a
trusted advisor.

1039
00:55:30,080 --> 00:55:33,120
Who else looks after you JD
mate?

1040
00:55:33,360 --> 00:55:36,160
More than a couple of people
Silverstone as we said in the

1041
00:55:36,160 --> 00:55:39,000
show MMS if you want to pull
your your mining costs down,

1042
00:55:39,000 --> 00:55:41,960
you'd be crazy not to get them
in verify smack parent

1043
00:55:41,960 --> 00:55:46,720
technology DSI underground CRE
insurance Greenland's equipment

1044
00:55:46,760 --> 00:55:51,160
K drill and you would have seen
a spark chart or two in today's

1045
00:55:51,320 --> 00:55:54,400
work who drew you would.
Have done money miners.

1046
00:55:56,600 --> 00:55:59,160
Information contained in this
episode of Money of Mine is of

1047
00:55:59,160 --> 00:56:01,240
general nature only and does not
take into account the

1048
00:56:01,240 --> 00:56:04,840
objectives, financial situation
or needs of any particular

1049
00:56:04,840 --> 00:56:06,880
person.
Before making any investment

1050
00:56:06,880 --> 00:56:09,920
decision, you should consult
with your financial advisor and

1051
00:56:09,920 --> 00:56:13,080
consider how appropriate the
advice is to your objectives,

1052
00:56:13,280 --> 00:56:15,280
financial situation and needs.