Empire Metals Share Discussion Threads

[gta5] 01/10/2024 10:02

Hi Manlord1, you are of course correct, and there is a chance the board expected the share price to be a little higher by now. It's possible. But on the flipside they're all old and experienced enough to know that an AIM company's valuation is "cash in the bank minus the rate of cashburn, or expected cashburn".
And if they want an MCAP above that they need to show some results (in this case output/quality from tests)
-Hence AIM is notoriously tricky.
So, in light of "they really should know better", I do stand by my dislike for raising at a meagre 7p as it only extends the runway another 6months or so, and does not add anything except for a little more time.
(It does not open the doors to plant purchase, additional acreage or machinery etc)
So for that reason I'm disappointed.
Now, I'm also open to the fact that I can be wrong in more ways than one. They might well be needing the cash for an ASX listing, or possibly for Grants/loans/investment collateral from AUS Gov.. but Its not what's stated yet ovbviously)
You are totally correct on one thing that most of us fail most of the time;
Patience.

I'll be mustering up some of that and leave the share price to find itself.....
GL, GTA.

[geko5trade] 01/10/2024 09:50

Manlord1, I agree with most of the substance of your post but not entirely. The fact is SB and the team knew the strong likelihood of very positive news flow but I think the findings exceeded the top end of expectations. For example the weathered cap is clearly considered game changing by EEE but the market jury is still out.

[klosters65] 01/10/2024 09:44

I find the dilution difficult to stomach. Why necessary for additional funds at this point in time ? I wonder if the Company has to have a certain amount of funds in the Bank to either apply for ASX listing or to qualify for grants / favourable loan from the Australian Government.

[manlord1] 01/10/2024 09:25

Hi GTA,If I was running the company and knew what they knew at the time I would have also pushed back the oversubscribed 11p placing to reduce dilution. The reason being that If I had knowledge of all the RNS's that came after, I would have 100% expected the share price to be well above the 11p and potentially placed at 20p for example keeping dilution as low as possible.Have I been surprised that the share price hadn't moved north, very! I think SB has too but alas, hindsight is a wonderful thing.ML

[manlord1] 01/10/2024 09:20

Juju, the only people being massacred are the sellers here! Patience will be rewarded. ML

[gta5] 01/10/2024 08:22

when they present tangible results.
I was hoping it'd be imminent, but judging by the recent placing I'm not so sure.
I'd expect a few weeks at the very least?
GL, GTA.

[juju44] 01/10/2024 07:48

When does this massacre end

[catch007] 30/9/2024 16:57

Much as I dislike the raise and dilution at this price level the company has taken the opportunity to provide funding certainty to the market and meet its medium term liabilities. A cash positive balance sheet position will underpin what should be a constant stream of positive news ahead as the resource magnitude becomes known and a true value can start to be applied as the company moves into construction mode. In due course I would like to see a move away from AIM for the company.

[geko5trade] 30/9/2024 15:42

gin_rummy99, Two good reasons I can think of.
Raise well in advance long before there's any suggestion company is running low. This in my mind trumps the exact price of the raising.
Secondly don't be short of cash when predators are sniffing around which could happen as processing route is proven. Negotiate from strength.
And another. To him that hath shall be given...Strange as it may seem, just like that line from the bible, government institutions prefer giving money to companies that are well run and have healthy finances and financial controls.
All imo.

[gin_rummy99] 30/9/2024 15:18

My guess is that they did the placing at this level because if there is good news and the share price does rise, then new investors will be happy and will likely buy more. Better than doing it at 14p and seeing it drop then they walk away empty-handed. Other than that I can't see any rationale for not waiting until after they can say theyve got the chemistry sorted.

[geko5trade] 30/9/2024 14:47

Agree to differ on this GTA5 but in your scenario suppose they hit the market with excellent news but for whatever reason there was selling into the strength (as there has been) then they would have been forced to raise as cash was getting low. Management can only look after the running of the company they can't 'know' or predict how the market behaves. Years ago I bought shares in a company in the mid 30p region that had fallen from £3.30. Cash generation EBITDA was stunningly good and the bottom line was almost unaffected by market turmoil. They were so cash rich all they were doing was buying their own shares, it's true they didn't need to raise, but they absolutely didn't see it coming. If this raising allows EEE to prove up resource and processing I'll be happy.

[tialouise] 30/9/2024 13:36

I think you need to look at dilution, if they had placed at 16 p we would still have dilution. The share price is irrelevant it's the increase in shares now against before that dictates the percentage.......

[gta5] 30/9/2024 13:36

35Million shares have been added to the ca. 600M shares in issue. Total new shares ca 635M = 5.8% dilution to existing shareholders, or thereabouts.
Agree Geko, Not a big issue in its own right, but I still think very badly handled.
The problem I have with this placing is that it's not come as a surprise or result of unforseen expenses or costs, but it's part of the day-to-day cost and could have been properly planned as they've seen this miles and miles coming.
A simple example could have been to NOT push back that extra 1M @11p that they did with Al Tamini last placing. OR, get the good results and once the share price is rising do a placing into a high SP, anything, but not at bloody 7p.
I remain heavily invested here, but I will keep calling them out when I see this behaviour. each and every one of the board should have known better than this.

GL GTA

[geko5trade] 30/9/2024 13:13

cielos, no I was replying to GTA5 who stated 5% dilution.
But I like your term 'perfect placing'! Reminds me of my search for the perfect pizza...doesn't exist.
The main point is there is no perfect set of decisions except with hindsight. However this company's trajectory has been stella. Sometimes reflected in SP, sometimes not. But this placing allows that trajectory to continue. Also I don't accept the stock overhang GTA refers to as it depends how firm the hands are that have taken the stock.

[cielos] 30/9/2024 13:09

I am watching a - watcher - posting after 9 months and now more than 1 funny post today.

[cielos] 30/9/2024 12:55

Geko

Are you sure your figures of 5% dilution is right?

7.75p - 7p placing = 0.75p : 7p placing = 10.71% dilution

The perfect placing should have been don the same day of the RNS or the day after. Now if the directors also participated on the placing, the lower the better for them and their friends.

[geko5trade] 30/9/2024 11:56

GTA5, they did show amazing results to the market! They’re doing much better than most AIM co’s trying to raise. You don’t know the overhang because you don’t know strategy of holders. 5% dilution hardly a reason to cry. Imo each to their own.

[juju44] 30/9/2024 11:42

Agree not well done

[onedayrodders] 30/9/2024 10:59

Never turn down funds on AIM when available ... it was not a million miles away from the current share price

Plenty of AIM companies holding their caps out to finance companies and accepting the dreaded CLN's ... we are not one of them

[suffolkjim] 30/9/2024 10:50

Bad news: Obvious dilution
Good news:
Worries removed about funding
Environmental plan in place
What this might mean: Could they be getting their ducks in a row before investment / loan from WA or Aus government? Full funding and an environmental plan might be the sort of things that a goverment would insist on before funding of any kind

[geko5trade] 30/9/2024 10:18

cielos, it’s not a perfect world and certainly not on AIM! The company had every reason to believe the share price would have been driven up by the excellent news flow that by any measure has exceeded expectations. But there was sustained profit taking and they can’t control that nor broader market factors and sentiment for small caps and debt generally. Master RSI has correctly called the recent very short term trend, a trend possibly underpinned by some recent forward selling, but the medium term has been sideways and the very long term up. I’d like it to have been higher and so would they but they’ve dealt with the elephant and are very well set up to progress.

[cielos] 30/9/2024 10:14

Latest Level 2
Peel on 7.4 Murex 7.5 then wins on 7.8.