Whilst I agree u/w is a big positive and the fundamentals of the resource quality only continue to improve; but management needs a shake-up.
Imo, time is a fundamental. There is nothing in to PFS which warrants the 6 month delay in its release.
In May, AVL made a song and dance about cobalt.
https://www.asx.com.au/asxpdf/20180522/pdf/43v6bxn9x938cq.pdf
I was thinking the 6 month delay may be due to ensuring cobalt was added to the PFS. Base metals inc cobalt are only 1% of revenues. So if management delayed the PFS for something which contributes less than 1% of revenues, then they have erred.
Secondly, I put the delay down to ensuring the PFS would include a phased approached. 98% for steel market in Phase 1 and 99.5% for VRB market in phase 2. A phased approach would, imo, reduce initial CapEx requirements. The PFS lacks this information.
Ironically, Vince now says on Twitter the SP fall has been caused by investors being "spooked" by the high CapEx number.
Previously, Vince was quoted in HC as saying the sell-off was due to oppies conversion. Imo, this is untrue. I have tracked the T20 throughout the year. Many T20 holders have bailed/reduce holdings. More of this will be posted on Twitter in the New Year.
So Vince has had 2 cracks at excuses for the SP fall; neither, imo are plausible. The SP is down, imo, due to poor decision making and a snail like pace. The PFS has a production target date which is out of step with the requirements of Win-win. Imo, the market does not trust AVL with dates. Have a look at the last timeline published in January 2018. One word: vague.
In the mining life cycle, I usually equate peak speculation with the release of the PFS. The SP around the original PFS release date was about 0.04. Often the SP will reduce by 50% after PFS. So if the PFS was released mid-year and the SP retraced to 0.02, then the oppies would struggle to get converted. The knock-on effect being cash constrained leading up to DFS and beyond. Surely management did not delay the PFS on account of the oppie expiry date...
I still cannot understand what it is Les Ingraham contributes as an Executive Director on about $200k. AVL paid 20m shares to hire a consultant to open doors in China which should have already been opened via AVL's association with Vanitec.
I would be quite happy for Todd Richardson to be promoted to the BoD and both of Les and/or Vince to be punted.
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