1 00:00:00,040 --> 00:00:03,560 No, this is a huge movement in the share price, like 50% like 2 00:00:03,560 --> 00:00:05,000 you said. You want to try and answer the 3 00:00:05,000 --> 00:00:08,200 question, were there any indications or could you as 4 00:00:08,400 --> 00:00:11,600 average punter on the street have had any foresight or 5 00:00:11,680 --> 00:00:14,240 suspicions that something like this would have happened? 6 00:00:23,520 --> 00:00:27,520 Mate, what a quarterly season. Stocks that are responding to 7 00:00:27,720 --> 00:00:30,040 results mate all. Those pawn shops mate. 8 00:00:30,280 --> 00:00:33,800 Boss has been beaten up, line line town kind of got out a 9 00:00:33,800 --> 00:00:36,640 little bit unscathed. Well, relatively speaking. 10 00:00:36,680 --> 00:00:39,920 Huge movement, so emerald they were down over 10 plus percent. 11 00:00:40,080 --> 00:00:44,360 Greatland 2424% on the day. Greatland smashed and. 12 00:00:44,360 --> 00:00:46,160 Unfortunately, not too many big jumps. 13 00:00:46,160 --> 00:00:48,960 On the upside, I think it's a bit of a result of the the short 14 00:00:48,960 --> 00:00:51,560 interest that build up and dwindled over time. 15 00:00:51,560 --> 00:00:52,800 But lots to chat about. Right. 16 00:00:52,800 --> 00:00:55,320 There's been big stock movements this reporting season, mate. 17 00:00:55,320 --> 00:00:57,960 And in addition to some of the quarterly results that have come 18 00:00:57,960 --> 00:01:01,680 out, I want to talk about some some some grassroots shareholder 19 00:01:01,680 --> 00:01:04,840 activism that is emerging. None of them word art resources, 20 00:01:04,840 --> 00:01:08,920 which have, you know, the board there has accepted a deal from 21 00:01:08,920 --> 00:01:12,120 Capricorn shareholders. Unsurprisingly, they're not 22 00:01:12,120 --> 00:01:14,000 happy, mate. We've been hounded to talk about 23 00:01:14,000 --> 00:01:16,000 this one. They're mate, it's amazing the 24 00:01:16,000 --> 00:01:20,200 organic interest in in, in Word I've been, I've been truly like 25 00:01:20,920 --> 00:01:24,040 surprised at the level of level of interest in the, the 26 00:01:24,080 --> 00:01:26,520 shareholder base there, but I've been compelled to talk about it. 27 00:01:26,520 --> 00:01:28,240 So I'm I'm gonna get to that later on too. 28 00:01:28,920 --> 00:01:30,360 Alrighty mate, let's let's start with boss. 29 00:01:30,360 --> 00:01:32,560 I think that's the the natural place to start because that was 30 00:01:32,600 --> 00:01:35,120 the the biggest share movement. So the. 31 00:01:35,240 --> 00:01:38,120 How far down is that since they put out the quarterly like it's 32 00:01:38,120 --> 00:01:39,880 like? So it notched off again the the 33 00:01:39,880 --> 00:01:41,920 following days. So obviously we're. 50 odd 34 00:01:42,000 --> 00:01:44,440 percent down like yeah, it's been that since the quarterly 35 00:01:44,440 --> 00:01:47,280 come out it's. Been a bit of a haircut for the 36 00:01:47,480 --> 00:01:49,960 companies that were that were long, the investors that were 37 00:01:49,960 --> 00:01:52,720 long. But yeah, so in in quotation 38 00:01:52,720 --> 00:01:55,280 marks, the highly successful ramp up is having a few question 39 00:01:55,280 --> 00:01:58,680 marks thrown around specifically that that the outlook has 40 00:01:58,680 --> 00:02:01,400 disappointed. And obviously for context, mate, 41 00:02:01,400 --> 00:02:03,840 the week prior had seen a management change. 42 00:02:03,840 --> 00:02:08,400 So Duncan Crabb, MD is going to step down through September, 43 00:02:09,400 --> 00:02:12,840 reported to come back early next year as an Ed, but a change in 44 00:02:12,840 --> 00:02:14,520 leadership at an interesting point of time. 45 00:02:14,680 --> 00:02:18,560 So we'll, we'll lead into the outlook by talking about the 46 00:02:19,320 --> 00:02:22,800 quarterly cash flow. So the looking at the waterfall 47 00:02:22,800 --> 00:02:26,160 chart here, you can get a bit of a flavor for how they did. 48 00:02:26,160 --> 00:02:30,360 And it's an it's an interesting one because they sold way less 49 00:02:30,480 --> 00:02:33,320 pounds compared to what they produced. 50 00:02:33,320 --> 00:02:37,760 So it, it looks a bit funny, But if if you back it out, you know, 51 00:02:37,920 --> 00:02:40,520 bearing in mind this was a, a good quarter where they're 52 00:02:40,800 --> 00:02:44,040 digging into to honeymoon, which they know a bit more about as a, 53 00:02:44,040 --> 00:02:47,320 as a resource. They would have earned $4 54 00:02:47,320 --> 00:02:51,000 million if you assumed that they had earned 31 and a half, 55 00:02:51,000 --> 00:02:53,640 $1,000,000 in extra revenue, assuming they would have sold 56 00:02:53,960 --> 00:02:56,680 everything so. But all in cash has actually 57 00:02:56,800 --> 00:02:58,560 gone gone down. It's gone down. 58 00:02:58,560 --> 00:03:02,480 So it's a bit over what is it like 36 million odd dollars as 59 00:03:02,480 --> 00:03:04,840 it stands with a bunch of inventories that they kind of 60 00:03:04,840 --> 00:03:09,400 market $85 on the assumption that they can assume it via this 61 00:03:09,400 --> 00:03:12,640 sort of carry trade that they've performed for a little while. 62 00:03:12,840 --> 00:03:15,880 But the the market probably well OK, they'll acknowledge the the 63 00:03:16,160 --> 00:03:18,160 operational performance of that quarter, but the stock doesn't 64 00:03:18,160 --> 00:03:22,440 fall like 40 plus percent in a single day on the back of 1 bad 65 00:03:22,440 --> 00:03:24,320 quarter. It's the guidance update that 66 00:03:24,320 --> 00:03:28,640 came contemporaneously with the quarterly which has spooked the 67 00:03:28,640 --> 00:03:30,880 market big time here. Yeah, yeah, absolutely. 68 00:03:30,880 --> 00:03:34,200 So rounding out on the on the quarter, because there's, 69 00:03:34,200 --> 00:03:36,640 there's hints of it and then they come out with a separate 70 00:03:36,640 --> 00:03:39,920 announcement like you say, which is guidance FY20 6, but they 71 00:03:39,920 --> 00:03:42,120 talk about increase reagent cost. 72 00:03:42,360 --> 00:03:46,360 Hence your, your cost profile for FY20 6 is heightened. 73 00:03:46,800 --> 00:03:49,040 And essentially what we're getting at is there there's a 74 00:03:49,040 --> 00:03:54,080 lower uranium concentration in the the PLS that comes out means 75 00:03:54,080 --> 00:03:56,600 you got to pump more and process more to kind of get to the same 76 00:03:56,600 --> 00:04:00,040 amount. So that PLS to IX 10 are that 77 00:04:00,040 --> 00:04:03,920 they speak about is going from a number in the high 80s to to the 78 00:04:03,920 --> 00:04:05,840 50s. And they speak about a long term 79 00:04:05,840 --> 00:04:10,280 life and mind average of a number around 50, which meaning, 80 00:04:10,360 --> 00:04:12,120 you know, when you think about the fact that they were in the 81 00:04:12,120 --> 00:04:14,920 80s and to average that out, they're going to in due course 82 00:04:14,920 --> 00:04:18,519 fall below that, which is a bit of a concern. 83 00:04:19,040 --> 00:04:24,560 So that number of £2.45 million per annum is what they'd guided 84 00:04:24,560 --> 00:04:25,920 to. And if you go back to the, the 85 00:04:25,960 --> 00:04:29,440 AFS, the, the feasibility study they'd done, I think that came 86 00:04:29,440 --> 00:04:34,440 out in 2021, they were meant to hit that number in year 3 of 87 00:04:34,440 --> 00:04:36,120 production. And that's all been thrown into 88 00:04:36,120 --> 00:04:39,400 doubt now. So guidance is £1.6 million per 89 00:04:39,400 --> 00:04:42,240 annum for the coming year. And then they indicated on the 90 00:04:42,240 --> 00:04:45,920 call that they expect to have a similar number the following 91 00:04:45,920 --> 00:04:47,560 year. And then it's a bit up in the 92 00:04:47,560 --> 00:04:50,680 air because there was a lot of talk about, you know, the 93 00:04:50,680 --> 00:04:53,160 continuity isn't great and we just need to assess it. 94 00:04:53,160 --> 00:04:55,840 We need to do work. We're meeting our continuous 95 00:04:55,840 --> 00:04:57,840 disclosure obligations by talking about it now. 96 00:04:57,840 --> 00:05:01,520 But we don't have enough answers was the kind of rhetoric on the 97 00:05:01,520 --> 00:05:04,120 call. So I think it's worth playing 98 00:05:04,120 --> 00:05:08,000 One question from Glenn Lowcock, he asked this one try not really 99 00:05:08,000 --> 00:05:09,680 hammer it home at at the three factors. 100 00:05:09,680 --> 00:05:11,600 I'll play it now so you can get a flavour for it. 101 00:05:11,960 --> 00:05:13,360 Hey, I'm still a little bit confused. 102 00:05:13,360 --> 00:05:16,600 So you say you've identified challenges that would may arise 103 00:05:16,760 --> 00:05:20,040 in achieving nameplate capacity which is the 2.45 and you talk 104 00:05:20,040 --> 00:05:21,440 about continuity of the resource. 105 00:05:21,440 --> 00:05:25,400 So is that leading to less volume coming out or less grade 106 00:05:25,400 --> 00:05:26,880 or less recovery? Like what do you? 107 00:05:26,920 --> 00:05:29,160 What is the one of those three that must be causing you to make 108 00:05:29,160 --> 00:05:33,200 that statement? Volume it's it's made the volume 109 00:05:33,280 --> 00:05:37,400 aspect like pounds on deluge. So you know we have to look at 110 00:05:37,400 --> 00:05:40,080 the well field design and the pounds under leach and what you 111 00:05:40,080 --> 00:05:42,320 want is continuity and results to give you that that sort of 112 00:05:42,320 --> 00:05:44,000 confidence in your well field design. 113 00:05:44,240 --> 00:05:47,640 And you know what we're saying now is the resources there 114 00:05:47,800 --> 00:05:50,520 additional wells are required that's leading to an increase in 115 00:05:50,520 --> 00:05:53,240 sustained capital that we're seeing in our all in sustaining 116 00:05:53,240 --> 00:05:56,760 cost for FY20 6. But yeah, the challenge there 117 00:05:56,760 --> 00:05:59,240 could lead to volume under Leach, so. 118 00:05:59,840 --> 00:06:02,520 Is that, is that because you have you Max out what you can 119 00:06:02,520 --> 00:06:04,560 put down the pipe back to the plant? 120 00:06:04,560 --> 00:06:07,040 I just, I mean if you just if it's more CapEx for more well 121 00:06:07,040 --> 00:06:10,080 fields and you didn't have you need more well fields to get the 122 00:06:10,080 --> 00:06:11,920 volume ultimately wants it. Doesn't that still get you the 123 00:06:11,920 --> 00:06:13,080 nameplate? What else is missing? 124 00:06:13,720 --> 00:06:15,400 You need to make the statement that you can't get there. 125 00:06:15,800 --> 00:06:18,360 You're right, it can and that's where that can still get you to 126 00:06:18,360 --> 00:06:20,360 nameplate, but that's where we want to do this assessment and 127 00:06:20,360 --> 00:06:22,920 just say, you know what that economic cost outlay is and the 128 00:06:22,920 --> 00:06:24,960 capital costs around oilfield infrastructure. 129 00:06:25,280 --> 00:06:27,400 So the resource is there. It's just a question of of as 130 00:06:27,400 --> 00:06:31,000 you say, the cost to do so. You know, at the moment there's 131 00:06:31,000 --> 00:06:34,560 the margins are still healthy for 1.6 going to FY20 7. 132 00:06:34,560 --> 00:06:37,040 We're confident that we'll get at least £1.6 million. 133 00:06:37,520 --> 00:06:40,000 It's just a question now of how we how we go about that. 134 00:06:40,000 --> 00:06:42,800 So, yeah, it's just I guess, yeah, we just wanted to flag 135 00:06:42,800 --> 00:06:45,840 that, that we need to do a review and and assess against 136 00:06:45,880 --> 00:06:47,920 our enhanced feasibility study assumptions. 137 00:06:49,000 --> 00:06:51,520 But this is an assessment of the economics then more or less you 138 00:06:51,520 --> 00:06:54,200 know like a more well fields, more CapEx, more OpEx. 139 00:06:54,520 --> 00:06:56,080 Can you still then make an economic model? 140 00:06:56,080 --> 00:06:58,800 But I would have thought with an $80 a pound uranium price and 141 00:06:59,120 --> 00:07:01,920 even with the cost and CapEx you're now incurring for £1.6 142 00:07:01,920 --> 00:07:04,280 million, surely it would be economic or you think there's 143 00:07:04,280 --> 00:07:05,560 going to be even more costs to come? 144 00:07:05,560 --> 00:07:07,160 No, Glenn, certainly that can be the case. 145 00:07:07,440 --> 00:07:08,840 Yeah, absolutely. That was a. 146 00:07:08,840 --> 00:07:11,320 Fascinating bit of a bit of audio mate. 147 00:07:12,320 --> 00:07:15,760 I love to follow up kind of line of questioning that Glenn takes. 148 00:07:16,280 --> 00:07:21,680 It's it's it's sort of simple as a grade continuity, like, yeah, 149 00:07:21,680 --> 00:07:23,920 you know, number of. We might be fumbling him a bit 150 00:07:23,920 --> 00:07:26,000 because I'm going to play another snippet from him, yeah, 151 00:07:26,040 --> 00:07:28,200 later on. But the the clarity and thinking 152 00:07:28,280 --> 00:07:32,160 and the breaking it down is, is super, super simple, right? 153 00:07:32,560 --> 00:07:36,080 And yeah, I love that sort of breaking it down to to what 154 00:07:36,080 --> 00:07:40,800 really matters. And the question to ask as an 155 00:07:40,800 --> 00:07:44,280 investor, what you want to kind of know is, no, this is a huge 156 00:07:44,280 --> 00:07:47,280 movement in the share price, like 50%, like you said, like 157 00:07:48,280 --> 00:07:50,840 you want to try and answer the question, what were there any 158 00:07:50,840 --> 00:07:54,720 indications or could you as average punter on the street 159 00:07:55,280 --> 00:07:58,960 have had any foresight or, you know, suspicions that something 160 00:07:58,960 --> 00:08:02,680 like this would have happened? Like that's what in any case, 161 00:08:02,680 --> 00:08:05,680 just to, to learn for going forward in, in your, your future 162 00:08:05,680 --> 00:08:08,240 investments. And I think it's worth going 163 00:08:08,240 --> 00:08:12,280 back a year and listening to the, the, the geological whiz, 164 00:08:12,280 --> 00:08:18,160 Mike Bevan and what he said on, on the show in June of 2024. 165 00:08:18,160 --> 00:08:22,320 So a bit over a year ago now. Uranium, when it occurs in your 166 00:08:22,320 --> 00:08:25,120 payday channels and, and sandstone hosted, you really 167 00:08:25,120 --> 00:08:29,720 want to have a, a good interval of, of sandstone or with high 168 00:08:29,720 --> 00:08:31,480 porosity, right? But you get good flows and you 169 00:08:31,480 --> 00:08:34,200 really want the uranium to be mostly within that sandstone 170 00:08:34,200 --> 00:08:35,440 layer. Now, sometimes what you do get 171 00:08:35,440 --> 00:08:38,240 is you'll get uranium, but it's either in clays or it's in a 172 00:08:38,240 --> 00:08:40,720 very narrow band of, of sandstone which is in contact 173 00:08:40,720 --> 00:08:43,240 with the clays. And if it is at that contact as 174 00:08:43,240 --> 00:08:46,040 well, what you'll often find is the uranium is actually stuck to 175 00:08:46,040 --> 00:08:48,160 the clays right or bound in the clays at the surface of those 176 00:08:48,160 --> 00:08:49,200 contact between those two layers. 177 00:08:49,320 --> 00:08:52,240 Now clays is not porous, right? You can't push uranium, you 178 00:08:52,240 --> 00:08:54,160 can't push a solution through it and and extract it. 179 00:08:54,400 --> 00:08:56,200 And also when you're when you're putting down your well right, 180 00:08:56,280 --> 00:08:58,080 you're pumping your solution down, which is then going to 181 00:08:58,080 --> 00:09:00,160 travel through a a little logical layer and get pumped up. 182 00:09:00,160 --> 00:09:02,360 You know, the amount of actual interaction with that uranium 183 00:09:02,360 --> 00:09:04,880 that's stuck to a roof of that sandstone is quite limited. 184 00:09:04,880 --> 00:09:08,960 So when that company went from well that was us that did that, 185 00:09:09,080 --> 00:09:10,240 right. So when they went from when they 186 00:09:10,240 --> 00:09:13,280 first took over the project, when they cut the when they cut 187 00:09:13,320 --> 00:09:16,480 the resource rate from 500 PPM to 250 PPM, it increased the 188 00:09:16,480 --> 00:09:18,400 resource as well. But a lot of that resource was 189 00:09:18,400 --> 00:09:21,280 within really quite confined pathologies. 190 00:09:21,280 --> 00:09:23,640 Now The thing is as well though, is that in the process of doing 191 00:09:23,640 --> 00:09:24,160 that. Review. 192 00:09:24,600 --> 00:09:26,840 There are very little cross sections available of their 193 00:09:26,840 --> 00:09:28,480 resource, right? So I can only make that 194 00:09:28,480 --> 00:09:30,480 inference from the information that's available. 195 00:09:31,000 --> 00:09:33,360 I wish his I wish his YouTube channel was still up Mike, but 196 00:09:33,360 --> 00:09:35,760 he's now that he's now that he's endeavoured on a new life. 197 00:09:35,760 --> 00:09:38,160 I think he I think he's his YouTube channel's unfortunately 198 00:09:38,160 --> 00:09:39,680 gone, but we've still got that little nugget so. 199 00:09:40,280 --> 00:09:43,080 So if we try and refresh listeners or people that didn't 200 00:09:43,120 --> 00:09:47,720 listen to to the segment right breakdown the the sort of thesis 201 00:09:47,720 --> 00:09:50,280 that he had looking at their work from the time. 202 00:09:50,880 --> 00:09:53,800 Yeah, I remember him kind of saying like the, the the horizon 203 00:09:53,800 --> 00:09:56,520 within the paleo channel that has the the best grades and is 204 00:09:56,520 --> 00:10:00,640 the most amenable to leaching is the lower, the lower one. 205 00:10:00,640 --> 00:10:03,960 Right now, Uranium One, they originally set that that cut off 206 00:10:03,960 --> 00:10:08,720 grade to 500 PPM and that's what they mined the horizon above it, 207 00:10:08,720 --> 00:10:13,320 which you know, you can see in that that cross section, that's 208 00:10:13,320 --> 00:10:15,440 a, a thinner interval of, of sandstone. 209 00:10:15,760 --> 00:10:19,400 The grade is lower and the grade often occurs at contacts between 210 00:10:19,400 --> 00:10:22,360 the sandstone and the upper layer, which is like sort of a 211 00:10:22,360 --> 00:10:25,800 clay material. When you've got the uranium 212 00:10:25,800 --> 00:10:29,600 concentrated at that horizon, it can be difficult to extract 213 00:10:29,600 --> 00:10:31,760 because it's more stuck to the clays than it is the sandstone. 214 00:10:31,760 --> 00:10:34,720 Or at least that's how I remember kind of MM retelling 215 00:10:34,720 --> 00:10:37,680 it. So so the sandstone is more 216 00:10:37,680 --> 00:10:40,320 coarse. You can get the lex Evian to to 217 00:10:40,320 --> 00:10:44,840 flow through it versus the clay, which is you know, it's not not 218 00:10:44,840 --> 00:10:47,800 permeable and you can't flush that lexivium that can't collect 219 00:10:47,800 --> 00:10:49,320 the uranium and be pumped back out. 220 00:10:50,040 --> 00:10:52,200 It's, it is also interesting, like I know you've, you've 221 00:10:52,200 --> 00:10:54,840 dropped into our show notes here, JD, like you can see the 222 00:10:56,320 --> 00:10:59,520 the Paleo Channel resource honeymoon to the left is Brooks 223 00:10:59,520 --> 00:11:01,840 Dam to the, to the right is East Calgaroo. 224 00:11:02,440 --> 00:11:07,160 And what you can see is there's like they've actually colour 225 00:11:07,160 --> 00:11:10,000 coded certain well fields and from like, I think it was the 226 00:11:10,080 --> 00:11:11,280 Macquarie presentation they put up. 227 00:11:11,280 --> 00:11:14,240 They basically say there's, there's three well fields in 228 00:11:14,240 --> 00:11:18,080 honeymoon there, which are set to kind of come on online in, in 229 00:11:18,080 --> 00:11:22,560 the first kind of 3/4 of if financial year 2026. 230 00:11:22,560 --> 00:11:24,200 The next three kind of quarters to report. 231 00:11:24,360 --> 00:11:27,200 We'll still see production from from honeymoon like well fields 232 00:11:27,200 --> 00:11:29,440 kind of coming online and, and that that delivering the 233 00:11:29,440 --> 00:11:31,560 production. Then it's East Kilcaroo well 234 00:11:31,560 --> 00:11:34,360 fields per this sort of schedule, which are you know 235 00:11:34,360 --> 00:11:37,480 marching or or accounting for a huge proportion of the the 236 00:11:37,480 --> 00:11:40,680 production here. Yeah, that's B6 through to B9, 237 00:11:40,680 --> 00:11:43,480 those Far East Kaikaru ones that will come online. 238 00:11:44,400 --> 00:11:48,760 I've, I have personally been surprised at how few people I've 239 00:11:48,760 --> 00:11:53,400 kind of talked to about, about, about boss, how few people knew 240 00:11:53,400 --> 00:11:56,240 about the great differential between East Kilkeroo and and 241 00:11:56,240 --> 00:11:57,040 honeymoon. So it's. 242 00:11:57,200 --> 00:11:58,560 A pretty substantial difference as well. 243 00:11:58,560 --> 00:12:01,360 Again, if if you go back to the 2016 mineral resource and I'll 244 00:12:01,360 --> 00:12:03,840 keep referring to that one because it's been scantly 245 00:12:04,480 --> 00:12:07,840 updated. And yeah, anyway this, this one 246 00:12:08,560 --> 00:12:13,760 you can see E kilkeroo is 640 PPM versus like honeymoon there, 247 00:12:13,760 --> 00:12:17,000 they've got nearly 1300 PPM. So it's a pretty substantial 248 00:12:17,000 --> 00:12:18,880 difference. A bit over double, yeah. 249 00:12:19,280 --> 00:12:23,120 It's fascinating to, to, to flick back to the market 250 00:12:23,120 --> 00:12:26,480 reaction, you can see that there was a sort of flash through of 251 00:12:26,720 --> 00:12:28,960 changes in substantial ownership and a lot of them were sort of 252 00:12:28,960 --> 00:12:31,200 prime brokers. You can't get a, a big tail, but 253 00:12:31,200 --> 00:12:34,040 there was one from a, a shareholder who rents $51 254 00:12:34,040 --> 00:12:38,000 million of stock on the day at an average share price of a bit 255 00:12:38,000 --> 00:12:40,360 over 2 bucks. So I don't think they'll be 256 00:12:40,360 --> 00:12:44,280 sending a BOSS a Christmas card anytime soon, but I'm sure 257 00:12:44,280 --> 00:12:47,160 there'll also be plenty of hedge funds on the short side that'll 258 00:12:47,160 --> 00:12:51,080 be kicking themselves too. Because we've spoken a lot about 259 00:12:51,080 --> 00:12:54,200 this sort of short factor squeeze over the the past 260 00:12:54,200 --> 00:12:56,840 quarter roughly. And what that's sort of 261 00:12:56,840 --> 00:13:00,600 reflected in with regards to Boss is the short interest 262 00:13:00,600 --> 00:13:04,480 falling pretty substantially. So it fell from about 25% all 263 00:13:04,480 --> 00:13:09,480 the way down to 12 or 13% as these equities across the 264 00:13:09,480 --> 00:13:12,640 market, uranium, lithium, some of the names that sort of come 265 00:13:12,640 --> 00:13:16,680 to mind, they those share prices rise and people had to sort of 266 00:13:16,680 --> 00:13:18,000 bail out of their positions, right. 267 00:13:18,000 --> 00:13:21,720 So I'm sure a few of them won't be as pleased as they might 268 00:13:21,720 --> 00:13:24,360 otherwise have been. And I would expect in due 269 00:13:24,360 --> 00:13:27,280 course, you know, once the the changes that we've seen in the 270 00:13:27,280 --> 00:13:29,600 past couple of days flush through another sort of change 271 00:13:29,600 --> 00:13:31,360 in that short interest, but an interesting one. 272 00:13:31,360 --> 00:13:34,840 No one ever feels sorry for a short seller, but but but I do 273 00:13:34,840 --> 00:13:37,040 feel sorry for shareholders. And I think like your to circle 274 00:13:37,040 --> 00:13:38,960 back to your, your question, which is like, could you have 275 00:13:38,960 --> 00:13:40,560 predicted this? Could you have seen it coming? 276 00:13:41,920 --> 00:13:44,840 Yeah, like I think like what are the other questions you can ask 277 00:13:44,840 --> 00:13:48,360 as a shareholder is like, you know, why, why? 278 00:13:48,560 --> 00:13:53,360 Why are they, why are there no cross sections of of East Kakuru 279 00:13:53,400 --> 00:13:55,160 in any of the mineral resource statements? 280 00:13:55,160 --> 00:13:59,360 Why is the mineral resource of, of honeymoon kind of through to 281 00:13:59,600 --> 00:14:03,120 East Kakuru not actually been updated to the market since 2019 282 00:14:03,120 --> 00:14:04,320 despite a bunch of drilling on it? 283 00:14:04,800 --> 00:14:07,560 You know why, You know, why is, why is there such scant kind of 284 00:14:07,560 --> 00:14:09,720 information about about some of this stuff? 285 00:14:09,840 --> 00:14:12,720 And you know, if you're if you're asking those kinds of 286 00:14:12,720 --> 00:14:14,760 questions, maybe get closer to being able to predict this. 287 00:14:15,080 --> 00:14:18,960 Yeah, yeah, well said. OK mate, tell us about Line 288 00:14:18,960 --> 00:14:21,200 Town. Line town, another interesting 289 00:14:21,200 --> 00:14:23,360 one mate. So first thoughts on line town, 290 00:14:23,560 --> 00:14:25,920 I'm not sure if you had the chance to listen to the, to the 291 00:14:25,920 --> 00:14:29,760 quarterly here, mate, but they spoke for 40 minutes and left 292 00:14:29,800 --> 00:14:31,520 less than 20 minutes for the Q&A. 293 00:14:31,640 --> 00:14:35,040 And I, I, I think that's kind of interesting framing, right? 294 00:14:35,040 --> 00:14:38,240 Because I think you can just chuckle that in a sort of 295 00:14:38,240 --> 00:14:40,480 written form of commentary from management. 296 00:14:41,080 --> 00:14:43,600 No problems with speaking 10 or 15 minutes, but you want to hear 297 00:14:43,600 --> 00:14:46,280 as many questions from the analysts as possible. 298 00:14:46,440 --> 00:14:49,040 Yeah, yeah. If your scripted component is is 299 00:14:49,520 --> 00:14:54,560 2/3 of the analysts call, then what do you, Yeah, come on, come 300 00:14:54,560 --> 00:14:55,720 on. You've got, you've got the, 301 00:14:55,720 --> 00:14:57,360 you've got the announcement, you've got the presentation and 302 00:14:57,360 --> 00:14:58,840 put all your your script and stuff in there. 303 00:14:58,840 --> 00:15:00,360 That is what it's for. Yeah. 304 00:15:00,440 --> 00:15:01,640 Anyway can? Count on you to say anyway. 305 00:15:01,640 --> 00:15:03,200 Punch your way, I'll forgive. Them this time off. 306 00:15:03,520 --> 00:15:07,360 So what what really matters in the the quarterly call and 307 00:15:07,480 --> 00:15:09,400 report, I think there's a few things to circle around. 308 00:15:09,400 --> 00:15:12,640 So obviously a lot of eyes on what's happening on the ROM pad 309 00:15:12,920 --> 00:15:14,840 there. So ROM stocks are are dwindling 310 00:15:14,840 --> 00:15:17,040 and they did flag this right. So they are going from that 311 00:15:17,040 --> 00:15:19,720 transition from open pit mining to underground. 312 00:15:19,720 --> 00:15:23,000 By Q3 of this financial year, they're going to be fully 313 00:15:23,000 --> 00:15:26,160 operating from the underground. So they built up the stockpiles 314 00:15:26,160 --> 00:15:28,680 there. And one of the the 315 00:15:28,680 --> 00:15:32,760 repercussions, again not a surprise is that there has been 316 00:15:32,760 --> 00:15:36,560 elevated gabro content going through the plant, meaning 317 00:15:36,560 --> 00:15:38,120 recoveries have dropped down substantially. 318 00:15:38,120 --> 00:15:41,800 So we saw them take up to that sort of 70% level and then they 319 00:15:41,800 --> 00:15:46,480 dropped down this quarter to 57% and we're expecting in the 320 00:15:46,480 --> 00:15:51,080 coming half year a a number between 60 and 65%. 321 00:15:51,080 --> 00:15:55,240 And then beyond that, expecting them to get to that 70 and 322 00:15:55,240 --> 00:15:58,600 really beyond that 70% as they, as Tony put it, can be a bit 323 00:15:58,600 --> 00:16:01,560 more surgical about the all that they pluck out from underground 324 00:16:01,560 --> 00:16:04,080 and they're going to need to do that to make the unit economics 325 00:16:04,360 --> 00:16:06,800 stack up. They talk about 222 types of 326 00:16:06,800 --> 00:16:09,960 all. OSP is all sorting product which 327 00:16:09,960 --> 00:16:13,480 is unsorted like or effectively it's it's got. 328 00:16:13,480 --> 00:16:15,080 Dilution and stuff you don't want. 329 00:16:15,120 --> 00:16:18,640 And then there's clean ore, which is, you know, post post 330 00:16:18,640 --> 00:16:21,320 sorting. Yeah, yeah, which, but it's 331 00:16:21,320 --> 00:16:23,600 just, it is, it's striking when you just look at the impact of 332 00:16:23,600 --> 00:16:28,240 recoveries as a result of putting more of the, the OSP 333 00:16:28,480 --> 00:16:31,080 through the mill. But the big question is, is 334 00:16:31,080 --> 00:16:33,640 like, well, well, like, like what? 335 00:16:33,640 --> 00:16:34,280 What? What? 336 00:16:34,480 --> 00:16:37,680 Why did you have to put through so much, you know, OSP through 337 00:16:37,680 --> 00:16:38,280 the middle? Yeah. 338 00:16:38,280 --> 00:16:41,120 And and it ties in with the broader question of where are 339 00:16:41,280 --> 00:16:44,240 unit costs heading. There is an expectation out 340 00:16:44,240 --> 00:16:48,040 there that these unit costs peel down and you can see in almost 341 00:16:48,040 --> 00:16:51,080 every analyst's model that they they're going to fall 342 00:16:51,080 --> 00:16:54,360 substantially between now and say FY 30. 343 00:16:55,080 --> 00:16:58,920 And the company hasn't really updated on these costs in in 344 00:16:58,920 --> 00:17:01,520 quite some time. So you're working off a steer 345 00:17:01,520 --> 00:17:04,240 from the company and you're making assumptions as an 346 00:17:04,240 --> 00:17:06,760 analyst. But as you'd suspect, there were 347 00:17:06,760 --> 00:17:08,680 a lot of questions around this. So we'll play one from Kate 348 00:17:08,680 --> 00:17:12,040 McCutcheon, which I think covers this quite well as they look to 349 00:17:12,040 --> 00:17:13,400 get a bit more clarity on this point. 350 00:17:14,160 --> 00:17:17,200 And then in Slide 16, you've told us that you expect FOB cost 351 00:17:17,200 --> 00:17:21,000 to come down 20 to 25% in 27. So that implies a little over 352 00:17:21,000 --> 00:17:24,560 800 a ton Aussie, which is kind of similar to Linda's question, 353 00:17:24,560 --> 00:17:27,560 is that level of cost out also how we should think about all in 354 00:17:27,560 --> 00:17:30,640 sustaining costs? And would it be unfair to assume 355 00:17:30,640 --> 00:17:35,520 that's a A level going forward? So a lot of the drop. 356 00:17:35,560 --> 00:17:39,400 In FY20 7 is because we start getting efficiencies, a lot of 357 00:17:39,400 --> 00:17:42,920 the mining costs underground are fixed and as we ramp up volumes, 358 00:17:42,920 --> 00:17:46,960 we we wash the fixed costs more cleanly over over more tons. 359 00:17:46,960 --> 00:17:49,560 From a sort of go forward perspective. 360 00:17:50,440 --> 00:17:54,280 You know, I think I mean as you can see in the the meal chart 361 00:17:54,280 --> 00:17:58,400 there, we do have high capital development costs at the moment 362 00:17:58,400 --> 00:18:00,760 and we expect those to to moderate over time. 363 00:18:01,640 --> 00:18:04,600 So as we've previously, just to build on what Graham said Kate, 364 00:18:04,640 --> 00:18:08,000 as we move into the thicker bulk zones of the ore body, which we 365 00:18:08,000 --> 00:18:11,280 anticipate doing in the back end of FY20 6 and inch 27, we will 366 00:18:11,280 --> 00:18:12,920 definitely get economies of scale. 367 00:18:13,120 --> 00:18:15,600 We will be able to wash over the fixed costs of the contract 368 00:18:15,600 --> 00:18:18,680 mining over more tons as we get into those larger Stopes. 369 00:18:19,920 --> 00:18:22,600 I find this so interesting. I'll I'll let, I'll let you, 370 00:18:22,600 --> 00:18:25,440 I'll let you continue point here, JDI. 371 00:18:25,440 --> 00:18:27,520 Trust Tony to, to hammer home the point. 372 00:18:27,600 --> 00:18:30,160 I, I think it's really interesting. 373 00:18:30,160 --> 00:18:34,200 The the obvious thing to say is that how could underground 374 00:18:34,200 --> 00:18:38,440 mining costs be lower than open pit mining costs? 375 00:18:38,800 --> 00:18:42,240 And when you look at those models, I, I hear what they're 376 00:18:42,240 --> 00:18:47,440 saying because the tons coming out accelerate and they, and the 377 00:18:47,440 --> 00:18:51,600 tons ultimately produced a significantly higher in 2728 378 00:18:52,000 --> 00:18:54,400 than what they are and, and have been going back. 379 00:18:54,400 --> 00:18:57,920 But really I think it's, it's a thumb suck. 380 00:18:57,920 --> 00:19:01,640 We, we, we don't really know. And it's a, it's a relatively 381 00:19:01,640 --> 00:19:03,760 big assumption to make that they're going to peel off. 382 00:19:03,760 --> 00:19:05,800 But what? What do you think on this one 383 00:19:05,800 --> 00:19:07,760 mate? Who who's who's mining 384 00:19:07,760 --> 00:19:09,640 underground cheaper than our computer mining? 385 00:19:09,640 --> 00:19:11,960 Just unit economics don't quite work that way. 386 00:19:12,320 --> 00:19:15,560 Yeah, it it, it's a tough one to to touch on a positive point. 387 00:19:15,800 --> 00:19:18,800 The lithium market has ticked up over the last month. 388 00:19:18,840 --> 00:19:21,680 And I think that that provides a bit of context to what really 389 00:19:21,680 --> 00:19:25,280 matters at the end of the day. And that is what is cash and 390 00:19:25,280 --> 00:19:28,160 what is cash going to look like in in a year, in two years? 391 00:19:28,160 --> 00:19:31,800 And can they see themselves through this, this pretty tough 392 00:19:31,800 --> 00:19:35,240 period in, in lithium pricing. So straight away you can forget 393 00:19:35,360 --> 00:19:37,400 positive operating cash flow that kind of goes out the door a 394 00:19:37,400 --> 00:19:40,240 lot of costs being capitalized. But we'll play another question 395 00:19:40,240 --> 00:19:45,000 from from the Q&A, which I think breaks this down in in in really 396 00:19:45,040 --> 00:19:46,960 simple to understand terms. Skid math. 397 00:19:47,240 --> 00:19:50,720 Skid Math. Just trying to if I run a very, 398 00:19:51,200 --> 00:19:54,200 if I run a very simple model of the midpoints of all your 399 00:19:54,200 --> 00:19:57,320 guidance including CapEx etcetera plus all the interest 400 00:19:57,320 --> 00:20:01,720 payments, principal payments, you're going to spend over 660 401 00:20:01,720 --> 00:20:04,760 million Australian this year before inventory adjustment. 402 00:20:05,360 --> 00:20:10,360 You know that means you know your break even is about 1050 403 00:20:10,360 --> 00:20:14,320 USA ton. On an SC six equivalent basis 404 00:20:17,360 --> 00:20:19,480 just based on your guidance, just running the skid math. 405 00:20:19,960 --> 00:20:21,520 So maybe you? Haven't had chance to do. 406 00:20:21,520 --> 00:20:24,160 That so assume you're right. So we're yeah. 407 00:20:24,240 --> 00:20:28,240 So what's the question? So I guess, you know that would 408 00:20:28,400 --> 00:20:34,440 today's price of $800 a ton cash burn of 100 got 156. 409 00:20:34,440 --> 00:20:38,320 So that's fine because I guess just you know, like what are you 410 00:20:38,320 --> 00:20:39,880 doing? You've got your extra 100 411 00:20:39,880 --> 00:20:43,480 million of debt you can you're allowed to get maybe you can get 412 00:20:43,480 --> 00:20:45,920 forward to defer. I just just curious, what are 413 00:20:45,920 --> 00:20:47,200 you doing? OK. 414 00:20:47,560 --> 00:20:49,480 To make sure you additional liquidity. 415 00:20:50,040 --> 00:20:52,240 OK. So that's the the question. 416 00:20:53,000 --> 00:20:56,160 OK, well look there's a couple of things we're going to focus 417 00:20:56,160 --> 00:20:57,920 on. Well, clearly we're going to 418 00:20:57,920 --> 00:21:01,640 focus more on cost optimization and we're going to pull that 419 00:21:01,640 --> 00:21:04,600 lever. The second thing is, you know, 420 00:21:04,600 --> 00:21:07,840 we've got a strong balance to start with 156,000,000. 421 00:21:08,960 --> 00:21:11,600 Thirdly, you know, we've got a track record. 422 00:21:11,600 --> 00:21:14,600 Well, there's a bit of a price improvement, but we've also got 423 00:21:14,600 --> 00:21:17,960 a track record of finding funding solutions with our 424 00:21:17,960 --> 00:21:23,040 customers and other parties. So we will continue to look at 425 00:21:23,040 --> 00:21:27,800 those funding options as we progress forward, as simple as 426 00:21:27,800 --> 00:21:30,360 that. But it depends really on where 427 00:21:30,360 --> 00:21:33,920 the market goes. Yeah. 428 00:21:33,960 --> 00:21:36,240 And and Glenn just to add to that, I mean we, we haven't 429 00:21:36,240 --> 00:21:40,040 pulled the lever on prepayments like a lot of our peers have 430 00:21:40,040 --> 00:21:41,880 done. We you know as we've just 431 00:21:41,880 --> 00:21:44,640 demonstrated in 27 and beyond, we have a significant amount of 432 00:21:44,640 --> 00:21:47,400 more volume to place. You know that could be spot, 433 00:21:47,400 --> 00:21:50,200 could be long term offtake. So, you know, we still have 434 00:21:50,200 --> 00:21:52,440 quite a lot of options ahead of us. 435 00:21:53,040 --> 00:21:55,800 Everyone's got levers. Always levers, mate. 436 00:21:56,480 --> 00:21:58,880 Prepaid. That's a, that's a, That's a 437 00:21:58,880 --> 00:22:01,600 lever, yeah. I think the broader question of 438 00:22:01,960 --> 00:22:05,960 going more down the debt route, which is all they seem to be 439 00:22:05,960 --> 00:22:09,760 interested in doing as opposed to raising equity is an 440 00:22:09,760 --> 00:22:12,800 interesting thing to think through because they've still 441 00:22:12,800 --> 00:22:16,280 got a huge market cap, right? Like it wouldn't be the most 442 00:22:16,440 --> 00:22:19,920 dilutive raise for a company in their, in their situation to, to 443 00:22:19,920 --> 00:22:23,640 perform. So of course you're always going 444 00:22:23,800 --> 00:22:26,480 to talk about the debt route, even if you're thinking in the 445 00:22:26,480 --> 00:22:27,960 back of your mind, you're going to raise equity because you 446 00:22:27,960 --> 00:22:30,520 don't want to scare the market off and make that a higher sort 447 00:22:30,520 --> 00:22:32,160 of cost of capital than it needs to be. 448 00:22:32,800 --> 00:22:35,760 But I don't know what are what are your thoughts on the the 449 00:22:35,760 --> 00:22:38,240 levers or the types of capital they could pull in? 450 00:22:38,840 --> 00:22:41,200 I feel like there's a bit of a Mexican stand off amongst a 451 00:22:41,440 --> 00:22:44,760 bunch of a bunch of like, yeah, lithium producers. 452 00:22:45,320 --> 00:22:48,680 Everyone else kind of gets a bit of a bump if someone else, you 453 00:22:48,680 --> 00:22:51,200 know, curtails their supply and it doesn't make a substantial 454 00:22:51,200 --> 00:22:54,920 difference to to the market. And I do feel a bit for Lontown 455 00:22:54,920 --> 00:22:57,840 because they, it's a single asset developer. 456 00:22:57,840 --> 00:23:00,040 It's not, they're not in the same situation as a lot of the 457 00:23:00,040 --> 00:23:03,040 other players where they've got other operations, a bigger 458 00:23:03,040 --> 00:23:06,680 balance sheet, a larger company. It's I don't need to be a 459 00:23:06,680 --> 00:23:09,000 position like I think it's a tricky situation to be in. 460 00:23:09,080 --> 00:23:10,920 There's no doubt. What would I do? 461 00:23:13,720 --> 00:23:14,840 Yeah. I would explore some of those 462 00:23:14,840 --> 00:23:17,080 like unique kind of funding options, but I wouldn't be 463 00:23:17,080 --> 00:23:19,160 averse to dilutive funding options as well. 464 00:23:19,280 --> 00:23:21,040 Yeah, I'm with you. Like we all want to see them 465 00:23:21,160 --> 00:23:23,800 kind of get through this and get at the the end of it. 466 00:23:23,800 --> 00:23:26,640 And there are certainly a number of ways in which they can do 467 00:23:26,640 --> 00:23:29,360 that. And yeah, I don't think hoping 468 00:23:29,360 --> 00:23:32,240 for the lithium price to tick up is it's necessarily the best 469 00:23:32,240 --> 00:23:33,800 strategy as much as you want that to happen. 470 00:23:33,800 --> 00:23:36,360 But let's sort of wait and see. I think that the last bit we 471 00:23:36,360 --> 00:23:38,680 have to play is probably the best bit of the call. 472 00:23:38,680 --> 00:23:43,000 And this was a little comment that Tony O made to to Linden on 473 00:23:43,000 --> 00:23:44,280 the way out. Let's give it a play now. 474 00:23:44,280 --> 00:23:46,640 Yes. Volume goes up, so volume goes 475 00:23:46,680 --> 00:23:47,080 up. Yep, Yep. 476 00:23:49,480 --> 00:23:50,120 Got it. OK. 477 00:23:50,120 --> 00:23:51,240 That's helpful. Thanks. 478 00:23:52,840 --> 00:23:54,240 Yeah, look, that's pretty much all I had. 479 00:23:54,320 --> 00:23:56,680 Thanks guys. You're going to change your 480 00:23:56,680 --> 00:24:02,440 rating on us, Linden? It's cricket. 481 00:24:02,440 --> 00:24:03,360 Next question. Thanks. 482 00:24:04,680 --> 00:24:08,560 But mate, Linden Fagan, he answered the question when JP 483 00:24:08,560 --> 00:24:11,520 Morgan brought out an updated research report later that 484 00:24:11,520 --> 00:24:14,200 evening. Retain underweight 30 cent price 485 00:24:14,200 --> 00:24:15,280 target. So he didn't change that. 486 00:24:15,480 --> 00:24:16,840 He did not change the rating on Lyntown. 487 00:24:17,320 --> 00:24:20,240 Next time, next time. But you know what gives me 488 00:24:20,240 --> 00:24:22,120 confidence in in Lyntown? Tell me. 489 00:24:22,520 --> 00:24:25,640 Knowing just how close they are to the Sandvik Ground Support 490 00:24:25,720 --> 00:24:28,640 Kewdale manufacturing facility. That makes sense mate. 491 00:24:28,640 --> 00:24:31,200 Kewdale, It is just just out of Perth. 492 00:24:31,200 --> 00:24:33,920 Well, it's in Perth, but that is close proximity. 493 00:24:34,320 --> 00:24:38,160 You can have your bespoke ground support needs manufactured right 494 00:24:38,160 --> 00:24:41,240 here and delivered in no time. A. 100% and how good is the 495 00:24:41,240 --> 00:24:43,120 strategy? Like this isn't just the Kewdale 496 00:24:43,120 --> 00:24:45,560 facility, Sandvik ground support, They do this all around 497 00:24:45,560 --> 00:24:46,680 the world. They're in every corner. 498 00:24:46,680 --> 00:24:50,120 They can get that order to your stat and I know you're a you're 499 00:24:50,120 --> 00:24:52,000 a big fan of the the apps out there mate. 500 00:24:52,000 --> 00:24:53,680 Are you on the ground support app from Sandy? 501 00:24:54,280 --> 00:24:56,960 Duh, mate. How good is that out right? 502 00:24:56,960 --> 00:24:59,600 If you want to Chuck in an order you want to sort of size up what 503 00:24:59,600 --> 00:25:01,680 you might need for your bolts and your mesh, you can just 504 00:25:01,680 --> 00:25:03,400 Chuck it in right there and then on the app. 505 00:25:03,440 --> 00:25:06,560 Elite, elite, elite. And it's not just the app 506 00:25:06,840 --> 00:25:09,920 either, mate, R&D, these guys are at the the bleeding edge of 507 00:25:09,920 --> 00:25:13,000 making underground operations as cheap as they can possibly be. 508 00:25:13,040 --> 00:25:15,480 Personally, I think the app is part of the R&D vision, but it's 509 00:25:15,480 --> 00:25:16,640 all part of the same puzzle mate. 510 00:25:16,640 --> 00:25:19,400 That is, but the innovation comes to the ground support the 511 00:25:19,400 --> 00:25:22,400 dynamic resin bolts mate. Far out that is, that is taking 512 00:25:22,400 --> 00:25:24,800 off. All born out of Derek Hurd's own 513 00:25:24,800 --> 00:25:27,480 creativity, right? Boy, and he's and he's wonderful 514 00:25:27,480 --> 00:25:28,440 team. That's it. 515 00:25:28,480 --> 00:25:31,320 It's the whole team takes all the whole team's responsible. 516 00:25:31,560 --> 00:25:34,040 All this is to say mate, that Sandvik Ground Support can help 517 00:25:34,040 --> 00:25:37,600 you drive down your costs and drive up your profitability. 518 00:25:37,600 --> 00:25:39,320 So get in touch with Sandvik Ground Support. 519 00:25:39,320 --> 00:25:41,560 While keeping people safe. Thank you, Derek Hurd, and thank 520 00:25:41,560 --> 00:25:42,960 you Sandvik Ground Support. Go Sandvik. 521 00:25:43,640 --> 00:25:47,640 To boss tank long town kind of scared to buy from just like 522 00:25:47,640 --> 00:25:50,080 share price perspective. It wasn't it wasn't like a super 523 00:25:50,080 --> 00:25:51,760 mover. Great land on the other hand, 524 00:25:51,760 --> 00:25:55,560 smashed, absolutely smashed. They tried to close to $7.00 a 525 00:25:55,560 --> 00:25:58,040 share 2 days ago. Now they're in the low fives, 526 00:25:58,040 --> 00:26:01,560 peeling back 24% on the day of the quarterly. 527 00:26:01,680 --> 00:26:03,240 Yeah, mate, tough, tough day in the office. 528 00:26:03,280 --> 00:26:07,160 I think the the the consolation is that they've been on a hell 529 00:26:07,160 --> 00:26:08,440 of a tear. Big tear. 530 00:26:08,600 --> 00:26:10,920 Yeah, big tear. So it's not all that bad to dive 531 00:26:10,920 --> 00:26:13,480 in. What's going on part of it is 532 00:26:13,480 --> 00:26:15,880 backward looking while the market reacted this way and sort 533 00:26:15,880 --> 00:26:19,320 of reflecting on the underperformance or the perhaps 534 00:26:19,320 --> 00:26:22,040 disappointment regarding grade and and reconciliation, 535 00:26:22,800 --> 00:26:27,040 especially when you're talking about the the stockpiled or but 536 00:26:27,040 --> 00:26:29,680 then of course, you've got the the outlook again, similar to 537 00:26:29,680 --> 00:26:34,880 boss the the outlook was not quite what it had been expected 538 00:26:34,880 --> 00:26:37,920 to be in the market. So those who purchase stock in 539 00:26:37,920 --> 00:26:41,960 the IPO, not a heap of people, although a bunch bought off the 540 00:26:41,960 --> 00:26:45,000 the Newmont sell down, they're underwater by 20%. 541 00:26:45,000 --> 00:26:47,240 But I'm sure, like we said, there's plenty of shareholders 542 00:26:47,680 --> 00:26:49,600 that'll be sitting quite pretty still. 543 00:26:50,400 --> 00:26:52,760 So what's actually happened from a garden's perspective? 544 00:26:52,920 --> 00:26:56,400 So breaking it down in in simple terms to try not to run through 545 00:26:56,400 --> 00:27:01,200 so many numbers, but looking at the midpoint of what gardens had 546 00:27:01,200 --> 00:27:05,840 previously been indicated to be you had 320,000 oz at 2500 547 00:27:05,840 --> 00:27:09,760 Aussie all in sustaining cost. Now what we're looking at is 548 00:27:10,560 --> 00:27:16,760 285,000 oz at 2600. So you know, call it 40 ish 1000 549 00:27:16,760 --> 00:27:19,680 less answers and A and a marginally higher cost profile 550 00:27:19,680 --> 00:27:22,480 there. If you reflect on the all and 551 00:27:22,480 --> 00:27:25,680 sustaining cost of the quarter just gone, that's coming out at 552 00:27:25,680 --> 00:27:28,480 about 1000 bucks higher. Now, granted, they they've 553 00:27:28,480 --> 00:27:31,680 benefited from purchasing these stockpiles and a bit of 554 00:27:31,680 --> 00:27:35,440 accounting and them not having to speak for the the mining 555 00:27:35,440 --> 00:27:38,960 costs in the in the stockpile product there, but it it's a big 556 00:27:39,040 --> 00:27:40,920 tick upwards. And what? 557 00:27:41,080 --> 00:27:42,160 Why? Like I said, why the 558 00:27:42,160 --> 00:27:45,160 readjustment? So firstly, you've got this 559 00:27:45,160 --> 00:27:48,560 grade reconciliation issues. So the the gold grade 560 00:27:48,560 --> 00:27:51,280 expectations in the stockpiles have been lowered down. 561 00:27:51,280 --> 00:27:54,760 In super simple terms, they talked a lot about risk 562 00:27:54,760 --> 00:28:01,280 adjustment, but it's gone from 0.64 down to 0.5 seven in the 563 00:28:02,000 --> 00:28:03,880 the higher grade stockpile that they have because they have 564 00:28:03,880 --> 00:28:09,360 these low grade stock page that run at about .3 also reflected 565 00:28:09,360 --> 00:28:13,240 in a bit of the open pit or as well. 566 00:28:13,240 --> 00:28:17,200 So they've been feeding a decent portion of this stockpile 567 00:28:17,200 --> 00:28:20,440 product through the plant, 2.2 million tons in in the past 568 00:28:21,160 --> 00:28:24,640 quarter alone. And then you've got another big 569 00:28:24,640 --> 00:28:27,960 adjustment in the growth capital that they're going to spend over 570 00:28:27,960 --> 00:28:29,800 Fr 26. So this has previously been 571 00:28:29,800 --> 00:28:33,000 guided at 80 million that's jumped up to about 250 million. 572 00:28:33,000 --> 00:28:36,360 So they're going to be doing a heap more drilling 240,000 573 00:28:36,360 --> 00:28:40,760 meters over the coming year. And this all sort of ties in 574 00:28:40,760 --> 00:28:43,720 with really wanting to extend that that mine life because if 575 00:28:43,720 --> 00:28:45,640 you remember when they purchased thing, there was only a couple 576 00:28:45,640 --> 00:28:46,920 years of mine life in it. So they want to. 577 00:28:47,400 --> 00:28:50,640 I'm going to push that out whilst they approach FID on. 578 00:28:50,640 --> 00:28:52,400 Have your own. Yeah, yeah. 579 00:28:52,400 --> 00:28:54,640 And they've got, they probably argue with the fact there's only 580 00:28:54,640 --> 00:28:56,680 a couple of years in my life and they'll talk about the future 581 00:28:56,680 --> 00:29:00,840 cutbacks to Telford etcetera. But the the reconciliation issue 582 00:29:00,840 --> 00:29:03,760 is interesting. You do this is just, you get, 583 00:29:03,840 --> 00:29:05,920 you get punished by the market when you, you're, you're 584 00:29:05,920 --> 00:29:08,280 disappointed on guidance or expectations and you get, you 585 00:29:08,280 --> 00:29:10,680 get punished in a disproportionate way then might 586 00:29:10,680 --> 00:29:14,560 be warranted. But at the moment you have one 587 00:29:14,560 --> 00:29:18,160 reconciliation issue in, in, you know, in one area, everyone 588 00:29:18,160 --> 00:29:21,120 starts wondering and extrapolating, are the lower 589 00:29:21,120 --> 00:29:23,120 grade stockpiles maybe going to have reconciliation issue as 590 00:29:23,120 --> 00:29:25,960 well? It's the those high grade ones 591 00:29:26,160 --> 00:29:28,080 that were recently mined. So was it an all body 592 00:29:28,080 --> 00:29:29,240 reconciliation issue and the model? 593 00:29:29,240 --> 00:29:31,920 Has been used and there's flashbacks as well to to Newmont 594 00:29:31,920 --> 00:29:34,800 because they had problems with this asset back in the day with 595 00:29:35,000 --> 00:29:38,000 certain reconciliation problems. So shareholders do not want to 596 00:29:38,000 --> 00:29:41,640 say that again, if we try and peel into like how much cash are 597 00:29:41,640 --> 00:29:44,160 they actually going to make over the foreseeable because they've 598 00:29:44,160 --> 00:29:47,160 come in at the back of six months where they've harvested a 599 00:29:47,160 --> 00:29:49,640 fair chunk of cash. But if you look forward and this 600 00:29:49,640 --> 00:29:52,560 is, you know, really back of the envelope type numbers, But if 601 00:29:52,560 --> 00:29:54,760 you assume the midpoints of their guidance over the next 602 00:29:54,760 --> 00:29:58,920 year and assume the current gold price, 5100 Aussie bucks, 603 00:29:59,720 --> 00:30:03,080 multiply the all in sustaining cost by 1.3 to give you a 604 00:30:03,080 --> 00:30:05,680 relatively friendly assumption for cake. 605 00:30:07,000 --> 00:30:10,520 That gives you $490 million. Now you minus the midpoints of 606 00:30:10,520 --> 00:30:14,800 CapEx, that's 370 million. You get 120 in, in free cash 607 00:30:14,800 --> 00:30:17,280 flow there. Now you also have to bear in 608 00:30:17,280 --> 00:30:20,280 mind that at the end of this year, they're going to reach FRD 609 00:30:20,280 --> 00:30:24,200 on heavier on. And I, I don't think it's out of 610 00:30:24,200 --> 00:30:27,560 the realm of possibility to, to see them spend 500 million plus 611 00:30:28,000 --> 00:30:33,600 over FY20 7 on CapEx, including, you know, the, the asset build 612 00:30:33,600 --> 00:30:36,520 and everything else they're going to spend on over that 613 00:30:36,520 --> 00:30:38,760 year. But all that's to kind of say 614 00:30:38,760 --> 00:30:42,480 that there might not be an awful lot of cash flow over the next 615 00:30:42,480 --> 00:30:47,880 few years as they sort of bring on have Iran and increase the, 616 00:30:47,960 --> 00:30:51,040 the sort of profile and extend the mine life and these sorts of 617 00:30:51,040 --> 00:30:52,480 things. It could be way off base, but 618 00:30:52,480 --> 00:30:54,680 they're just sort of rough numbers on that one. 619 00:30:55,400 --> 00:30:57,400 They're they're, they're going to, they're probably going to 620 00:30:57,400 --> 00:31:00,000 argue their case that you've double punished them on, on 621 00:31:00,000 --> 00:31:03,400 CapEx for applying cake and then mining CapEx again. 622 00:31:03,640 --> 00:31:06,240 But. I I would argue back. 623 00:31:06,280 --> 00:31:08,600 Yeah. You would argue back the the, 624 00:31:09,560 --> 00:31:14,080 the, the 370 CapEx that you subtracted there is that 625 00:31:14,280 --> 00:31:18,360 including like you know the bunch of kind of work going on 626 00:31:18,400 --> 00:31:21,200 in the the decline for Haveron? 70 million bucks. 627 00:31:21,200 --> 00:31:21,600 OK. OK. 628 00:31:21,680 --> 00:31:23,760 So there's partial, partial work into Haveron as well through 629 00:31:23,760 --> 00:31:25,240 that, OK. Yeah, Yeah, that's right. 630 00:31:25,240 --> 00:31:28,760 So I think like overall the the asset is clearly in the hands of 631 00:31:29,440 --> 00:31:31,240 a company that cares more about it. 632 00:31:31,240 --> 00:31:33,920 And I think the asset's improving and I think all the 633 00:31:33,920 --> 00:31:37,400 drilling they're going to do here is it's a good sign, right? 634 00:31:37,400 --> 00:31:39,280 Because it's going to extend the mine life and it's going to help 635 00:31:39,280 --> 00:31:41,560 them understand. So you don't have these shocks 636 00:31:41,560 --> 00:31:44,240 with like the, the drill spacing is coming down quite 637 00:31:44,240 --> 00:31:46,800 dramatically. So you've got other positives 638 00:31:46,800 --> 00:31:48,400 like recoveries being at 15 year highs. 639 00:31:48,400 --> 00:31:51,600 If you look at the, the full financial year and they're 640 00:31:51,600 --> 00:31:53,520 sitting on a relatively healthy pile of cash. 641 00:31:53,520 --> 00:31:58,040 So the the readjustment has been pretty harsh and it's a bit of 642 00:31:58,680 --> 00:32:02,160 pill to kind of swallow. Is the business like 24% worse 643 00:32:02,160 --> 00:32:04,680 than it was the day before? I don't really think, I don't 644 00:32:04,760 --> 00:32:08,040 think you're going to mark down NAV 24% on the back of these 645 00:32:08,040 --> 00:32:10,160 results. So I think it's more of a factor 646 00:32:10,160 --> 00:32:12,400 of people getting a bit carried away with how good things could 647 00:32:12,400 --> 00:32:15,760 have been previously and extending those sort of 648 00:32:15,760 --> 00:32:18,520 expectations going forward. I think things are still, you 649 00:32:18,520 --> 00:32:20,960 know, like it's, it's there for them to deliver, right? 650 00:32:21,360 --> 00:32:24,120 Let's let's get into a bit of activism, a bit of M&A with 651 00:32:24,120 --> 00:32:27,040 Capricorn and Warda. I've been compelled to do this 652 00:32:27,040 --> 00:32:31,120 segment, JD, from the flurry of of emails and DMS and everything 653 00:32:31,120 --> 00:32:33,680 that I've had from Warda shareholders. 654 00:32:33,680 --> 00:32:35,400 I didn't know there were so many of them out there, did you? 655 00:32:36,840 --> 00:32:40,400 Antimony yeah, retail connecting a few dots I didn't know 656 00:32:40,400 --> 00:32:42,440 beforehand, but looking backwards. 657 00:32:42,920 --> 00:32:45,320 Yeah. Well, anyway, I'm now very well 658 00:32:45,320 --> 00:32:48,520 aware. So Capricorn, they've agreed a 659 00:32:48,640 --> 00:32:52,320 script deal to buy Word and it's triggered a wave of kind of 660 00:32:52,320 --> 00:32:54,800 grassroots pushed back mostly from the the retail shareholders 661 00:32:54,800 --> 00:32:58,560 of of Word who feel that the deal undervalues them. 662 00:32:58,560 --> 00:33:02,200 Those shareholders, they're voicing their dissatisfaction 663 00:33:02,200 --> 00:33:05,080 and they're organising on stock forums to try and force a 664 00:33:05,080 --> 00:33:07,680 different outcome compared to the deal on hand right now. 665 00:33:07,800 --> 00:33:09,880 OK. If we step back, what? 666 00:33:09,880 --> 00:33:12,680 What is the deal? The terms are kind of simple. 667 00:33:12,760 --> 00:33:16,960 You know, what are our shareholders for every 62 shares 668 00:33:16,960 --> 00:33:18,880 they own, they're going to get one Capricorn shares. 669 00:33:18,880 --> 00:33:22,560 And what does that merger ratio kind of back out or the 15 1/2 670 00:33:22,560 --> 00:33:26,720 cent kind of per share price for, for your word, our 671 00:33:26,720 --> 00:33:28,600 shareholding. That's a, that's a 29% premium 672 00:33:28,600 --> 00:33:30,480 toward our last close before the deal was announced. 673 00:33:30,840 --> 00:33:34,080 And the whole company has $190 million equity value all in 674 00:33:34,080 --> 00:33:37,200 Capricorn script. Everyone knows Capricorn best in 675 00:33:37,200 --> 00:33:40,240 class kind of execution of building gold mines and 676 00:33:40,240 --> 00:33:42,760 shareholder value. Team team is elite. 677 00:33:42,840 --> 00:33:44,480 You know, they, they've got a premium for a reason. 678 00:33:44,480 --> 00:33:46,840 They execute their long term thinkers. 679 00:33:46,840 --> 00:33:49,920 They're now they're they're of course, you know, making money 680 00:33:49,920 --> 00:33:51,160 color window. They're expanding that. 681 00:33:51,440 --> 00:33:54,560 The development project for some time has been Mount Gibson gold 682 00:33:54,560 --> 00:33:59,120 project, which is in the vicinity of Wardas Golden Range 683 00:33:59,120 --> 00:34:03,040 project and and associated kind of deposits there Ward are still 684 00:34:03,040 --> 00:34:05,480 in pre development phase. They've got you know, they've 685 00:34:05,480 --> 00:34:08,040 got some promising Oz, particularly at our I'm going to 686 00:34:08,040 --> 00:34:10,320 call it Ricky Otto because it's spelled Ricky Otto, but they 687 00:34:10,320 --> 00:34:13,520 probably pronounce it Ricardo, but you'd know better namesake 688 00:34:13,520 --> 00:34:17,880 mate. Anyway, the Antimony adds some 689 00:34:17,880 --> 00:34:20,679 complexity, but it's also strategic value, and it's also 690 00:34:20,679 --> 00:34:24,239 probably the reason the stock has the retail following it 691 00:34:24,239 --> 00:34:26,639 does. Yeah, they're not in an awfully 692 00:34:26,639 --> 00:34:30,360 unfamiliar position for a company like like them, right? 693 00:34:30,400 --> 00:34:33,520 No, no, I don't think so. And like the, you know, the 694 00:34:33,520 --> 00:34:35,520 truth of the position that they're in is it's like, you 695 00:34:35,520 --> 00:34:37,880 know, the classic challenge of pre cash flow junior, I mean, 696 00:34:38,080 --> 00:34:39,760 gold mark has been great. So a lot of these companies have 697 00:34:39,760 --> 00:34:42,400 been ripping, but you know, they, they're trying to convert 698 00:34:42,400 --> 00:34:45,080 the exploration momentum into institutional interest. 699 00:34:45,400 --> 00:34:48,719 Like, you know, you're funding long enough to advance without 700 00:34:48,719 --> 00:34:51,840 dilution, getting the market to pay attention for more than 5 701 00:34:51,840 --> 00:34:52,960 minutes. All of that stuff's tough. 702 00:34:52,960 --> 00:34:55,320 And they'd started to build a strong following. 703 00:34:55,320 --> 00:34:58,160 That following now feels like the board sold the company too 704 00:34:58,160 --> 00:35:01,680 early and too cheaply so. What do you think mate? 705 00:35:02,200 --> 00:35:05,160 I have a bias to usually sympathize with the shareholders 706 00:35:05,160 --> 00:35:07,440 who feel aggrieved or done wrong by a board. 707 00:35:07,600 --> 00:35:09,720 I'm usually in their court like 90% of the time. 708 00:35:10,200 --> 00:35:13,520 This time I'm not, I'm not convinced it's a bad outcome for 709 00:35:13,520 --> 00:35:15,920 shareholders. But to explain that, I'm going 710 00:35:15,920 --> 00:35:17,280 to try and contextualize what I mean. 711 00:35:17,280 --> 00:35:21,440 Like I think the shareholders are they're comparing like I see 712 00:35:21,440 --> 00:35:24,600 a lot of them talk about this, you know, EV per Oz and they'll 713 00:35:24,600 --> 00:35:27,320 compare it to to Spartan and other recent deals. 714 00:35:27,360 --> 00:35:30,320 And you know, you know how I kind of think about some of 715 00:35:30,320 --> 00:35:32,440 that, like the value of announced in the ground is not 716 00:35:32,440 --> 00:35:33,840 the same as the value of announced in the ground 717 00:35:33,840 --> 00:35:36,440 somewhere else with higher grade and all that kind of stuff. 718 00:35:36,440 --> 00:35:40,640 What's what's more though is I think, I think where our 719 00:35:40,640 --> 00:35:42,920 shareholders they might not fully appreciate like 720 00:35:42,920 --> 00:35:45,800 Capricorn's motivations and their motivations aren't as 721 00:35:45,800 --> 00:35:47,720 straightforward as you know what you just read in the deal 722 00:35:47,720 --> 00:35:50,000 rationale that's come to market. Yeah, OK. 723 00:35:50,040 --> 00:35:51,920 So I mean, let's peel out What? Why? 724 00:35:51,920 --> 00:35:56,000 It's an OK deal then. So shareholders like, well, a 725 00:35:56,000 --> 00:35:58,920 big group of shareholders appear to think that the board has done 726 00:35:58,920 --> 00:36:02,280 a bad deal for them. And you remember, like you can 727 00:36:02,280 --> 00:36:06,760 actually read the the scheme, yeah, the Sid when it comes up 728 00:36:06,760 --> 00:36:08,560 and the deal's announced and you can figure out when the 729 00:36:08,560 --> 00:36:10,440 confidentiality agreement was signed. 730 00:36:10,840 --> 00:36:14,720 Now, in this case, ACA was signed between Capricorn and 731 00:36:14,800 --> 00:36:17,720 Warda on the 25th of March. So that's four months before the 732 00:36:17,720 --> 00:36:21,360 deal was actually announced. Warda stock was six cents then. 733 00:36:21,360 --> 00:36:24,480 And I don't think it's immediately apparent to everyone 734 00:36:24,480 --> 00:36:26,680 what is like happening when ACA gets signed. 735 00:36:26,680 --> 00:36:30,920 But the usual, the usual process, you know, for ACA to 736 00:36:30,920 --> 00:36:34,640 actually get signed is, you know, a, a, a bidder or someone 737 00:36:34,640 --> 00:36:37,400 who has interest in a target that will, that will, you know, 738 00:36:37,400 --> 00:36:40,800 give the chair of the, the target company and NBIO and the 739 00:36:40,800 --> 00:36:44,840 NBIO will say, you know, like, subject to mutual due diligence, 740 00:36:44,840 --> 00:36:46,600 be interested in pursuing a corporate transaction. 741 00:36:46,600 --> 00:36:49,400 Sometimes they'll often name a price, sometimes they don't name 742 00:36:49,400 --> 00:36:51,680 a price. And the, the receiver, like 743 00:36:51,760 --> 00:36:55,200 their defence strategy might, might initially debate to knock 744 00:36:55,200 --> 00:36:57,240 it back or to argue for an uplifting price. 745 00:36:57,240 --> 00:37:01,120 So by the time you actually get to the point where ACI is 746 00:37:01,120 --> 00:37:04,240 executed, like the, there's already been a bit of a 747 00:37:04,240 --> 00:37:07,360 negotiation on price, sort of subject to subject to further 748 00:37:07,360 --> 00:37:10,800 due diligence or maybe maybe you agreed to, to share some initial 749 00:37:10,800 --> 00:37:13,440 kind of material. But the full amount of, you 750 00:37:13,440 --> 00:37:15,800 know, DD required comes a little bit later. 751 00:37:15,800 --> 00:37:18,280 But you get close on price before you actually sign that 752 00:37:18,280 --> 00:37:20,600 CA. And, and for Capricorn to 753 00:37:20,600 --> 00:37:23,960 actually like sign that CA 6 of March, like they're going to, 754 00:37:23,960 --> 00:37:26,520 they're going to put a bunch of conditions in the NBIO that's 755 00:37:26,520 --> 00:37:29,040 actually sent to, to worry around in the 1st place. 756 00:37:29,040 --> 00:37:31,080 And one of the conditions you're kind of always going to put in 757 00:37:31,080 --> 00:37:33,960 these situations is something like, no, for like, you know, 758 00:37:33,960 --> 00:37:36,560 where this is conditional on the current share structure, which 759 00:37:36,560 --> 00:37:37,720 looks like this. And you're not going to raise 760 00:37:37,720 --> 00:37:39,160 any more equity. So it's all of these kind of 761 00:37:39,160 --> 00:37:41,720 pricing things are conditional on the capital structure at that 762 00:37:41,720 --> 00:37:43,640 point in time. And no, no material change. 763 00:37:44,040 --> 00:37:46,480 So they've, they've actually entered the CIA four months ago 764 00:37:46,680 --> 00:37:49,760 with a, with a date. And when I see that, I usually 765 00:37:49,760 --> 00:37:54,520 assume that a price is agreed four months ago and, and it's 766 00:37:54,520 --> 00:37:56,640 going to be conditional and no change to the capital structure. 767 00:37:57,200 --> 00:38:02,160 Now 4 months ago, word our stock was six cents and the capital 768 00:38:02,160 --> 00:38:04,720 structure looked different too, because word our raised 769 00:38:04,720 --> 00:38:08,560 $19,000,000 in May and they said they'd spend that drilling out 770 00:38:08,560 --> 00:38:12,040 50,000 meters. In one sense, you know, that's 771 00:38:12,040 --> 00:38:16,200 kind of a curious thing because like, you know, Capricorn is 772 00:38:16,200 --> 00:38:19,320 there, they've agreed, they've agreed enough to get the CIA 773 00:38:19,320 --> 00:38:22,360 signed and they wouldn't want the race to be that. 774 00:38:22,360 --> 00:38:24,680 No one wants to acquire cash with a print for a premium. 775 00:38:24,680 --> 00:38:26,640 Like, you know, you don't want that race to happen, right? 776 00:38:27,000 --> 00:38:29,280 But on the other hand, I actually think word I kind of 777 00:38:29,280 --> 00:38:32,200 needed to do that because their, their own cash balance was 778 00:38:32,200 --> 00:38:33,960 dwindling by that point. I think it was like it would 779 00:38:33,960 --> 00:38:36,240 have been less to less than 5,000,000 bucks at the time they 780 00:38:36,240 --> 00:38:39,200 did the race. Now, if they're negotiating with 781 00:38:39,200 --> 00:38:41,880 Capricorn, Capricorn kind of has a bit of leverage because word 782 00:38:41,880 --> 00:38:44,600 has come raise. So the so the word I bought 783 00:38:44,600 --> 00:38:48,680 raises money and doing so they're kind of playing hardball 784 00:38:48,680 --> 00:38:51,200 with Capricorn. It's risky, you know, Capricorn 785 00:38:51,360 --> 00:38:54,920 could walk, but they don't, and it's potentially let them get in 786 00:38:55,600 --> 00:38:59,840 an even higher eventual price. Explain that further mate. 787 00:39:00,000 --> 00:39:03,200 What do you mean there? So assuming the price is agreed 788 00:39:04,000 --> 00:39:08,520 when the NBI, like you know when the CIA was signed and when the 789 00:39:08,520 --> 00:39:13,560 stock was $0.06, right? No way was a price then agreed 790 00:39:13,560 --> 00:39:15,840 between the parties going to be 15.5 cents. 791 00:39:15,840 --> 00:39:18,800 I'd imagine like a $0.10, you know, a healthy premium was was 792 00:39:18,920 --> 00:39:20,040 maybe agreed between the parties. 793 00:39:20,040 --> 00:39:23,360 But Warda stock runs to $0.13 in short order. 794 00:39:23,720 --> 00:39:25,600 Capricorn needs to get comfortable with much higher 795 00:39:25,600 --> 00:39:27,720 price now or or walk away entirely. 796 00:39:28,040 --> 00:39:31,360 And if Warda has no money, it's harder to kind of negotiate from 797 00:39:31,360 --> 00:39:32,840 that position. They need options. 798 00:39:33,200 --> 00:39:35,040 And one option is to solicit, you know, others. 799 00:39:35,040 --> 00:39:37,120 Another option is to to go with a loan. 800 00:39:37,720 --> 00:39:39,920 It says only ACI was signed. So we don't know if there was 801 00:39:39,920 --> 00:39:42,080 exclusivity yet. Don't you know, I'm not not sure 802 00:39:42,080 --> 00:39:44,840 on that from, but at least the CIA was, was, was signed. 803 00:39:45,160 --> 00:39:48,880 To me it looks like the the race kind of forced Capricorn to lift 804 00:39:48,880 --> 00:39:51,600 their price, you know, forced them to, to to get their own 805 00:39:51,600 --> 00:39:53,960 value, even though from the point they signed the CIA like 806 00:39:53,960 --> 00:39:57,320 this, you know, this is this is a much healthier price stock. 807 00:39:57,680 --> 00:39:59,360 So it's a risque defence strategy. 808 00:39:59,360 --> 00:40:01,880 So I mean, what do you think the real value is and? 809 00:40:02,360 --> 00:40:05,640 To expand the conversation, you know, you can, you can sort of 810 00:40:05,640 --> 00:40:08,000 speak to that for Capricorn and potentially others out there. 811 00:40:10,360 --> 00:40:13,520 I, I think like when I think of Capricorn, like, you know, we, 812 00:40:13,520 --> 00:40:15,560 we, we spend a lot of time trying to understand the 813 00:40:15,600 --> 00:40:17,120 different Dnas of different companies. 814 00:40:17,800 --> 00:40:23,520 Capricorn like long term thinking from their side, like 815 00:40:23,880 --> 00:40:25,200 acquiring the project makes sense. 816 00:40:25,200 --> 00:40:28,520 Golden Range sits like 90 kilometres South of Mount 817 00:40:28,520 --> 00:40:30,920 Gibson. This obvious synergy, some 818 00:40:30,920 --> 00:40:35,160 people will point to a model that Capricorn might embark on 819 00:40:35,160 --> 00:40:37,640 like, like, like, you know, it's done with Dukeden. 820 00:40:37,640 --> 00:40:41,720 You got kind of 22 mills, you know, it's like 100 KS part. 821 00:40:41,720 --> 00:40:44,880 And you know, various feeds, you get optionality. 822 00:40:45,160 --> 00:40:46,920 You know, you can bring on different things at different 823 00:40:46,920 --> 00:40:49,800 times and, and avoid the, you know, when you're long or you 824 00:40:49,800 --> 00:40:52,320 can avoid some some of the lost value that comes from things 825 00:40:52,320 --> 00:40:54,080 being deferred till till later in the mine plan. 826 00:40:54,760 --> 00:40:59,240 And if you look at Mount Gibson specifically like Capricorn will 827 00:40:59,240 --> 00:41:02,520 be long or there that like they they did a first drill program 828 00:41:03,040 --> 00:41:06,000 which was outside the Mount Gibson resource recently on the 829 00:41:06,000 --> 00:41:10,280 highway prospect that hit 28 meters at 8.6g a ton, something 830 00:41:10,280 --> 00:41:14,880 like that. You know, is it like, you know, 831 00:41:14,880 --> 00:41:16,360 it's early stage, it's got to be proved up. 832 00:41:16,360 --> 00:41:19,400 Is it which part of the mine planet Mount Gibson is it going 833 00:41:19,400 --> 00:41:20,440 to go into? It's got to be trucked as 834 00:41:20,440 --> 00:41:22,640 opposed to being like right near the mill, but you get 835 00:41:22,640 --> 00:41:25,600 optionality by actually tracking that to a different location, be 836 00:41:25,600 --> 00:41:29,400 it be it where, you know, word as existing plant which requires 837 00:41:29,400 --> 00:41:33,160 refurbishment is or an alternative plant as well. 838 00:41:33,160 --> 00:41:35,440 Because if you look in that region, you've also got Golden 839 00:41:35,440 --> 00:41:38,560 Grove and that meal at Golden Grove is already set up to 840 00:41:38,560 --> 00:41:42,320 process complex ores. And that's what like, you know, 841 00:41:42,320 --> 00:41:46,680 word as and like met requirements may actually kind 842 00:41:46,680 --> 00:41:49,400 of require a plant without, you know, capacity. 843 00:41:51,000 --> 00:41:52,520 Yeah. So I mean, flicking that over, 844 00:41:53,080 --> 00:41:55,800 the Warrior shareholders say they want to hear a bit more. 845 00:41:56,120 --> 00:41:57,600 Where do you think it kind of leaves them? 846 00:42:00,720 --> 00:42:03,160 From my perspective, this is probably as good a scripted as 847 00:42:03,160 --> 00:42:07,320 warrior was likely to get right, and that will fiercely disagree 848 00:42:07,400 --> 00:42:10,320 with me on this, but that's OK. Many views makes a market. 849 00:42:11,360 --> 00:42:14,000 You have to you have to think through the alternatives for 850 00:42:14,000 --> 00:42:17,120 warrior like and it should be said nothing. 851 00:42:17,120 --> 00:42:20,400 Nothing here is precluding someone else from bidding a 852 00:42:20,400 --> 00:42:22,120 higher bid. Like a third party can come 853 00:42:22,120 --> 00:42:26,720 along and bid higher and happy days, but absent that, you know, 854 00:42:26,920 --> 00:42:30,040 like what, what a word ours options or why would 855 00:42:30,040 --> 00:42:32,120 shareholders be grave? Because the, the you know, the 856 00:42:32,120 --> 00:42:34,440 board is and the shareholders, they're choosing between two 857 00:42:34,440 --> 00:42:37,880 things. Go it alone or try and advocate 858 00:42:37,880 --> 00:42:40,600 for an uplift or accept the, the the you know, the the existing 859 00:42:40,600 --> 00:42:44,800 Capricorn offer. I think like just zoom out 860 00:42:45,520 --> 00:42:47,920 really, really long term. Keep it simple, kind of just 861 00:42:48,200 --> 00:42:50,800 getting on the Capricorn train has been a fruitful strategy 862 00:42:50,800 --> 00:42:54,200 historically speaking. So, you know, that said, the 863 00:42:54,200 --> 00:42:57,520 scheme still needs 75% shareholder approval and the 864 00:42:57,520 --> 00:43:00,120 forums allowed the retail sentiment. 865 00:43:00,360 --> 00:43:03,000 It does matter here. There's I've seen people allege 866 00:43:03,000 --> 00:43:07,400 numbers as much as a, a 30% block of retail shareholders are 867 00:43:07,400 --> 00:43:08,760 going to vote against this and that. 868 00:43:08,760 --> 00:43:13,400 And that clearly, you know, doesn't, doesn't, doesn't, 869 00:43:13,400 --> 00:43:15,720 doesn't, doesn't exactly work for a, for a scheme. 870 00:43:16,440 --> 00:43:18,960 So there might be a recap or there might be, maybe it's a 871 00:43:18,960 --> 00:43:22,600 bluff and maybe the bluff will be cold, or maybe, maybe, maybe 872 00:43:22,600 --> 00:43:23,680 it won't. Maybe there'll be an uplift. 873 00:43:23,680 --> 00:43:27,200 Like maybe, maybe the structural change all of that is to play 874 00:43:27,200 --> 00:43:29,120 out. I'm following it closely. 875 00:43:29,520 --> 00:43:33,000 I I usually, I do empathize with shareholders and everyone wants 876 00:43:33,000 --> 00:43:35,880 more, but, but I would just encourage word our shareholders 877 00:43:35,880 --> 00:43:39,840 to think of like, you know, the, the, yeah, sixth sense versus 15 878 00:43:39,840 --> 00:43:41,160 1/2. It's always hard to when you're 879 00:43:41,160 --> 00:43:43,880 anchoring based on, you know, the day before the deal was 880 00:43:43,880 --> 00:43:44,560 announced. But yeah. 881 00:43:45,440 --> 00:43:47,600 I'm with you mate. I think that's a a great spot to 882 00:43:47,720 --> 00:43:49,800 to leave it. Let's thank our fantastic 883 00:43:49,800 --> 00:43:52,280 partners that grounded sanded ground support and cross 884 00:43:52,280 --> 00:43:55,360 boundary energy. Who to read mate over the 885 00:43:55,360 --> 00:43:59,160 weekend. Now remember, I'm an idiot. 886 00:43:59,440 --> 00:44:01,880 JD is an idiot. If you thought any of this was 887 00:44:01,880 --> 00:44:04,400 anything other than entertainment, you're an idiot. 888 00:44:04,760 --> 00:44:05,920 Then you need to read out a disclaimer.