This is growing into a good company. However, I have sold, not for fear of losing but common-sense and take profit . The rule applies (or should) to all investors but is often lacking and not just in investing. By my estimation, they have to raise a further £55-62m depending on which rules/estimates are used. Its my view it's higher than the companies estimates of £50m in addition to other finance if I was off the fence it would be £56.5M albeit not difficult for a company of this calibre. I suspect the terminology used will be 'due to an over subscribed placing/rights issue.'
For me, its unusual not hold any equity in Wolf Minerals (the company) and certainly wont until the placing/rights issue is out the way. There will be a material drop in the price either prior or after the placing. Will I be short? Only if the indicators present itself which they don't currently, so I suspect I'll miss it. However, I don't believe there's any material upside that warrants continuing to hold. Perhaps I'll be wrong...but that'll be hindsight and its cost me nothing only missed profit which you should never worry about.
The company has all the benefits and advantages of a decent company, unlike many I could list and for those that know me, the one I'm attempting to make them change their management ethos of "it'll improve some day and when it does we'll all be laughing" Yes, there's actually a company out there whose strategy is to do absolutely nothing bar award themselves 'shares' and significantly high fees whilst the company barely breaks even at Group Level. Sounds like many doesn't it! They are gradually giving in, with one falling by the wayside already, just 3 more to go and reduce their salary and jobs a good'un. Of course, their view is their salary is consistent with all the other companies. So let me get this right, they have not achieved their targets, issued options, have not achieved financially, pay rises and salaries in excess of 1/2$M a year ($5M collectively), but best of all, they believe they can do absolutely nothing to improve the share price 'until the market turns.' So if anyone is on such a retainer/salary and has that ethos, can you explain how you actually get motivated?! (bar a stonking salary). I personally would be unfulfilled!!
Its my view, and rightly pointed out by the what appears to only be Tom Winnifrith & Co, that companies treat PI's once they've got their monies (i.e. bought shares) as immaterial, with expressions of "if I could buy I would be filling my boots." I don't agree with some of the companies that Tom picks and discusses but that's investing. I dare say he wouldn't agree with some of the stocks I short that are crap but that's the market. What Companies don't realise is, after various promises and failed attempts to ignore the situation that company(ies) are in, they now face shareholders asking serious questions ad being better informed. I 'doff my cap' to Tom, I don't know him, have not met him, but do read some of his articles. A normal chap with a passion, whose ability to withdraw from controversy is nil, I suspect he loves the kill!
So have a good weekend!
Atb Fraser
Fraser
ReplyDeleteRe WLFE- yes, the bridge needs to be refinanced pre June and there is a bit of a gap re their revised projections so £55m or so seems about right. Im curious re WLFE as the bridge is with Resource Capital, their major shareholder with 36.4%, who are private equity so they need an exit strategy at some time there. They got their £75m debt via a syndicate of three banks over 7.5 years (2 years without repayments then repayable over 5.5 years) so I could see them looking at a further debt solution rather than new equity here. The numbers for this project are v supportive and payback could be within 4 years, when they get prod running in earnest in 2015. Looking at their 6/11 presentation they have had approx. 1 years slippage re the timescales here, which is v good all things considered. Im long :-)) (I bet you guessed that) and can see some price weakness in the run up to June but there are no real obstacles to this happening now and tungsten is moving in their favour. I understand your point re holding now/later but I will stay in for my part.
Re RUR- what can I say, an interesting day and night ahead.
Re FTML- they have mentioned Bluecora (BCOR- Nasdaq) as being the next West Coast target- Im looking now.
Cheers and have a great weekend. The Leggie
Fraser
ReplyDeleteRussell Clark of WLFE is quoted in the Sat Times (after crossword done!) as saying that they need to raise £50m (but Im with you in the mid 50s here) but that RFC and Todd Corp (56% holders between them) "are willing to provide the funding through a rights issue". So you could be right (as usual :-))) or this could be a fallback if my debt solution preference is less attractive.
Cheers. The Leggie.
Ps Keeping an eye on the RUR website but nothing yet- Peter Earl did say they would have a summary on there over the weekend- Im sure you are aware.