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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Pensana Plc | LSE:PRE | London | Ordinary Share | GB00BKM0ZJ18 | ORD �0.001 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-1.55 | -6.21% | 23.40 | 23.00 | 23.80 | 25.00 | 23.10 | 25.00 | 188,990 | 16:35:08 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Miscellaneous Metal Ores,nec | 0 | -4.3M | - | N/A | 0 |
Date | Subject | Author | Discuss |
---|---|---|---|
01/12/2022 20:25 | The key point from the AGM was the likely need for additional funding at the AGM. Whether that will be at a discount is a different matter. The fund raisings from M&G and the Angolan Sovereign Fund I believe were done pretty close to market. No-one raised any Qs re salaries. | mwj1959 | |
01/12/2022 19:26 | Did anyone raise the question of executive salaries? | cyberbub | |
01/12/2022 19:26 | Thanks very much Mjw! Very useful. I suppose the question now is whether any new fundraising is likely to be heavily discounted or not. The comparators with the other REM companies at a similar stage suggest that we are still severely undervalued. Of course the UK market is always harsher and more subject to short term spivs trading and manipulating the SP, than the US market. However the fact that the statements at the AGM are out in the open now, and the share price hasn't been badly walloped today, seems hopeful?The interest rates demanded by bond lenders at 15%-odd seem extortionate and I would hope they will come down. Regrettably, like with mortgage holders etc, Pensana are 9-12 months too late to capture the historic lows in interest rates. I agree that the company may have to settle for 10-12%, but even after that the business case will still be very strong.I'd always assumed that Pensana was a company of two independent parts, although it's worth making that point, that they are independent. One could argue that the company is undervalued today even only for Longonjo, where the financing seems to be much easier and potentially could be closed in Q1 (on time as per the Crux interview)? | cyberbub | |
01/12/2022 17:26 | cyberbub - not seen anything re PA and shares related to funding and I've had a quick butchers at the annual report. He vested nearly 4m Performance shares in FY 21, but has none outstanding now. His bonus for 2022 is partly linked to delivering finance...so he's got until the end of Q2. Here's the extract from the Annual Report... The committee reviewed the annual bonus targets for FY2022 to ensure that they are aligned to our strategic priorities subject to finalisation of the FEED study and completion of main financing. The bonus scorecard for FY2022 was linked to: • completion of main financing; • completion of the FEED study; • initiation of construction at Longonjo and Saltend; • health and safety objectives; and • ESG objectives. | mwj1959 | |
01/12/2022 17:15 | Some more detailed comments A key point that I took away from the Q&A session was that we need to look at Pensana as a two project company - Longonjo is the downstream company and Saltend a midstream company. Both can operate completely independently of the other, are not dependent on each other and are broadly speaking being financed as such. Longonjo can sell into the worldwide REM market, while Saltend can buy REM from elsewhere. But the value to Pensana, according to PA, is primarily in Saltend being developed as margins are likely to be far higher there (60 - 70% EBITDA margin) versus Longonjo at a 10 - 15% EBITDA margin. So the company could exist just with Longonjo, but the icing on the cake comes from Saltend. On financing: Saltend - As posted earlier the bond part of the $250m fund raising is not progressing at present and won't do so until the board feels market conditions are more favourable (i.e. the cost of funding are more reasonable - what that exactly means is hard to interpret, but PA was saying that if they had raised the money in the past couple of months it would have cost mid teens % with conditions attached, such as the interest payable being put into an escrow account. Clearly we're not going to get back to the sort of mid to high single digit levels seen 6m+ ago, so I would presume something in the low double digits, 10 - 12%? would be acceptable). So, nothing before Q2 in my opinion. As far as the other $75m goes there continues to be discussions with a whole range of strategic investors (PE, hedge funds, closed end funds, royalty companies etc.) with a broad range of instruments being considered, such as convertibles, royalty payments etc. I didn't ask whether all the moving parts of the financing needed to be completed at the same time. Overall, it is clear that PA was far too optimistic in the Crux interview, which he freely admitted. Longonjo - A very different project financing challenge, but also likely an easier one. Raising the bond / loan package, which will be guaranteed by UK Export Finance, is being co-ordinated by ABSA, who are speaking to three bilateral government agencies, two South African and one American. The level of interest rate is not subject to the vagaries of the bond market and as such a much more competitive rate should be achievable here. Discussions are progressing faster than thought and are in their final stages. So, takeaway here is more positive than for Saltend. Putting the two together and the obvious conclusion is that we're not nearly as advanced in the process are some thought and those who voiced concerns were right to do so. Given this far from ideal situation someone (definitely of the disgruntled investor type)asked when the company would run out of money. A valid question to ask. PA said that it wouldn't run out of money because there were supportive shareholders, who would continue to fund the company. But there would need to be a fund raising in Q1, unless some sort of miracle happened on the financing front. How much would that be? The Q wasn't asked, but $10m was raised last time around in August. How the burn rate has changed since then I don't know. The state of the share price was also raised, which PA addressed by showing side 26 in the AGM presentation (hxxps://pensana.co. My overall conclusion is that while the market fundamentals underpinning the company continue to be extremely attractive and the potential upside for equity investors remain substantial over the LT, but only if financing is achieved. Ultimately I think it will be (even if ultimately they have to accept higher rates on the bonds than is optimal), but there is likely to continue to be significant uncertainty around this for the foreseeable future (quarters rather than years clearly), which is likely to weigh on sentiment towards the share price in ST, even after the declines we've already seen. For those LT investors, hoping that the Lassonde Curve will out, this will likely provide a good entry point. All my opinions of course!! | mwj1959 | |
01/12/2022 16:26 | A friend of mine who attended said that they did have an offer of funding but that the servicing of the debt was prohibitive (or at least that was my understanding). | mhssh | |
01/12/2022 15:54 | The Angolan Sov Wealth Fund will be less than impressed, having bought a big tranche at 66p a few months ago.... And they can't invest much more as they're not far off 29%... | cyberbub | |
01/12/2022 15:45 | Thanks Mjw! Will look forward to your full report later. In the meantime what's the Longonjo position in a nutshell?Disappointi | cyberbub | |
01/12/2022 15:42 | So the video interview was just baseless pumping to spike the share price and allow the rise to be sold into before the AGM. Jam tomorrow | oapknob1 | |
01/12/2022 13:56 | ski - PA confirmed that most of his shareholding is classified under Selection Capital, so that resolves the mismatch that I highlighted previously. He's going to get it made clearer in the presentation. | mwj1959 | |
01/12/2022 13:54 | I'll put a fuller report up later, but the headline is that there is likely to be a capital raise in Q1 to provide further development capital to keep the project on the road. This is largely due to the poor market conditions still present in the HY bond market after October's market dislocation (although they have been improving recently). Higher costs of doing a bond issue at current levels (they talked about an additional $50m plus all sorts of other conditions) meant that the board was not prepared to go to market and wanted to wait for conditions to improve before considering doing so (Longonjo is a different matter, more on that later). PA did admit that he was too optimistic around timelines in his Crux interview! So, Saltend funding probably looks a Q2 story at best. Patience very much required with this one and there may well be more pain before the gain. | mwj1959 | |
01/12/2022 13:23 | In a word, would you say it's more jam tomorrow? | mhssh | |
01/12/2022 12:39 | Funding not sorted. Still up in the air. | oapknob1 | |
01/12/2022 11:17 | MMs may be trying to hit stop losses by taking it below 50p? | cyberbub | |
30/11/2022 22:04 | Mwj, I doubt you will be given the opportunity to ask more than 1 question, or 2 max. Make sure they count, and ask the 'friendliest' question first :-) | cyberbub | |
30/11/2022 21:09 | Selection Capital is PA. | skijapan1 | |
30/11/2022 18:39 | Afraid not able to comment (have not studied) but certainly no harm asking (shows people paying attention). On financing, not only dilution to consider but interst rate on any bond. Could be eye-watering. From a wholly unreliable source, there was again mention of ATF funding (besides the £4.0m already pledged). Would be interesting to know if there was any mention of the anticipated source of the funding, such as it is. | mhssh | |
30/11/2022 17:58 | Anyone have any thoughts about PA's shareholding discrepancy between the Annual Report and the latest presentation. I'm going to raise the Q tomorrow at the AGM. Hopefully a straightforward explanation and that I've missed something. And I would say that nothing surrounding this has any inference that there has been anything untoward. There just appears to be a discrepancy that I would like to be cleared up / clarified. | mwj1959 | |
30/11/2022 15:08 | It's not like giving an interview, spiking the share price and the rise being sold | oapknob1 | |
30/11/2022 14:01 | It's one thing to say that broker rumours might have been leaking, that's always possible, but alleging that the Chairman has been leaking or insider trading is something else entirely. | cyberbub | |
30/11/2022 12:28 | Well Liberum will having done a lot of client marketing around their initiation piece and they must be involved in any equity raise. | mwj1959 | |
30/11/2022 12:27 | I suggest being careful about allegations about directors committing crimes, on a public BB. Posters have been sued in the past. | cyberbub | |
30/11/2022 11:57 | Yup, perfectly possible. | mhssh | |
30/11/2022 11:20 | Leak or PA giving insiders advance warning? | oapknob1 | |
30/11/2022 10:16 | In context the share price is just back to where it was a couple of months ago, but agree that the signal from it is hardly optimistic / signals confidence in the project given that was close to the lowest level for a couple of years. Let's see what PA comes up with tomorrow. As we all know it is ultimately about funding. But I'm concerned from a regulatory perspective as to whether he'll be able to provide the sort of detail we all want. So it may well be that we just get a holding statement. At least by attending I'll get the feel for the body language. Anyone else intending to go to the AGM? | mwj1959 |
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