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Trevali Mining Corporation (0VLM.L)

LSE - LSE Delayed price. Currency in CAD
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1.1100+0.9200 (+484.21%)
As of 04:54PM GMT. Market open.
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  • R
    RealityShift
    REVERSE SPLIT 1 FOR 10 SHARES COMING. This will bury old investors like amber did to dinosaurs. This is a short set up like HIVE...nice
  • e
    expert
    Trevali is also pleased to announce that its Board of Directors has approved a consolidation (the "Consolidation") of the common shares of the Company on a [ten-to-one] basis. The Company has 989 million common shares outstanding and if completed, the Consolidation would reduce the issued and outstanding common shares to approximately 98.9 million common shares. Subject to TSX Approval, the Company anticipates that the Consolidation will take effect on or around December 1, 2021, at which time the common shares will trade on a consolidated basis under the existing name and trading symbol.
  • K
    Kv
    wow,what made it jump ,was it r/s ?
  • T
    TurboJesus
    Just finished listening to the call. I didn't hear anything particularly negative. Missed sales will be delayed till q4 at an anticipated higher zinc price. And most importantly, RP2 project will be financed with debt, which by the sounds of it, they seem to have suitors. RS seems to be priced in at current SP and so is the missed q3 rev. What's the downside in the short term?
  • S
    SayWhat?
    TD Waterhouse update:
    We have updated our estimates to reflect Trevali's Q3/21 results.
    Impact: SLIGHTLY NEGATIVE
    ■ On balance, Q3/21 was a weaker-than-expected quarter for both production
    and costs. Mine-site costs should improve through year-end and into early-2022
    as the company mitigates the ground-control issues at Caribou and divests
    Santander. Trevali should also benefit from higher zinc sales and prices in Q4/21
    as it draws down inventory levels that were built-up due to port-congestion issues
    at Rosh Pinah and Perkoa during the quarter.
    ■ Santander sale makes strategic sense — We model the Santander sale closing
    later this month and have trimmed our Q4/21 production results accordingly.
    Overall, we believe the sale of Santander makes strategic sense as its sheds the
    company's highest-cost asset and allows it to focus on its growth initiatives at
    Caribou and Rosh Pinah (RP2.0).
    ■ RP2.0 expansion has potential to effectively double current production by
    2025 — The company released its RP2.0 feasibility study during the quarter,
    detailing an after-tax 8%NPV of $156mm using a zinc price of $1.17/lb, well below
    current levels. The expansion is expected to substantially increase throughput
    (+86%), while lowering onsite operating costs by an estimated 26% on a per-tonne
    basis. We model throughput ramping-up to ~1.3Mtpa with payable zinc production
    of ~140mmlbs by 2025, at average onsite operating costs of approximately $0.41/
    lb Zn across the mine life.
    ■ Balance-sheet refinancing — Trevali ended Q3/21 with a negative working
    capital position of $28mm. The company is currently in discussions to not only
    refinance its existing debt, but also secure additional financing to undertake the
    RP2.0 expansion. For now, we assume that its existing debt facility ($98mm) is
    pushed out past 2022 and that the company can secure additional debt financing
    to begin development on RP2.0 early next year.
    TD Investment Conclusion
    We are reducing our target price to C$0.25 and maintaining our HOLD rating.
    We view the sanctioning of the RP2.0 expansion project as the next catalyst/
    milestone for Trevali, although we would prefer to wait for greater visibility on the
    financing package required before getting more constructive on the name
  • g
    gursharan
    I guess this quarter zinc prices will be averaging around 1.50 so they will have enough cash as a margin for financing
  • j
    jef
    I really wish TurboJesus would comment, but let me know if I'm wrong in my summary. They sold a mine that has AISC $1.08 to $1.14/lbs of zinc, which had target production of about 50 million lbs of zinc. Say price of zinc is $1.35/lbs - this mine SHOULD have returned about $10 million per year. But they sold it for $3.4 million dollars to another company (based on 10 million shares that seem to be worth $0.34/share), with some clawback options depending on the price of zinc.

    Have I got this right? PLEASE tell me that I have some of the facts wrong. I'm completely bewildered by the management of this company. I'm dying to hear what they have to say for themselves on Friday.
  • S
    SayWhat?
    TD Waterhouse Summary of latest quarter. Looks to me like another 'messy' quarter. Missing estimates is a very bad thing.

    Event
    Trevali reported its Q3/21 financial and operating results. Management will host a
    conference call today at 1:00 pm ET (dial: 877-291-4570).
    Impact: NEGATIVE
    ■ Trevali reported Q3/21 adjusted EBITDA of $20.5mm, below both our
    estimate of $30.6mm and consensus of $36.0mm. The miss on EBITDA versus
    our estimate was largely revenue related, as port congestion at Perkoa and Rosh
    Pinah delayed the timing of sales. With the exception of Rosh Pinah, cash costs
    were also higher than expected.
    ■ Trevali reported consolidated production of 82.4mmlbs zinc, below our
    estimate of 87.8mmlbs. Production was lower than expected at Caribou due
    to poor ground conditions, while Santander experienced challenges due to the
    reported slow mobilization of a new mining contractor. As a reminder, the company
    plans to divest Santander in Q4/21 (note). Production was in line with our estimate
    at Rosh Pinah, while the lower results at Perkoa were mill throughput related.
    ■ Total consolidated C1 cash costs for the quarter were $0.85/lb Zn (net) (TD:
    $0.83/lb), while AISC were $0.99/lb Zn in line with our estimate. We calculate
    that Trevali generated positive FCF of $3mm in the quarter before working capital
    changes and $29mm after working capital changes.
    ■ Net debt reduced during quarter - The company ended the quarter with cash of
    $40mm, while net debt declined by $27mm to $82mm. Trevali now has a negative
    working capital position of $28mm as the result of the reclassification of a portion
    of its long term debt. Management is currently in the process of renegotiating its
    debt facilities with current and new prospective lenders.
    ■ 2021 production expected to fall towards the low end of guidance -
    The company now expects production to fall towards the lower end of the
    330-355mmlbs zinc guidance range. At the same time, costs are expected to rise
    towards the upper ends of its C1 guidance of $0.80-$0.84/lb and AISC guidance
    of $0.94-$0.98/lb. We model 2021 payable zinc production of 342mmlbs at C1
    cash costs of $0.83/lb and AISC of $0.96/lb.
  • T
    TurboJesus
    I'm not out. Not yet. Generally a stock consolidation is a bad thing. Management could be purposefully consolidating stock in order to issue more later. Not good. Judging by the management's track record, and their focus on expanding RP2, I would bet they dilute in the future to finance. I was hopeful they'd find less dilutive methods of financing RP2, but with this consolidation, I'm thinking there might be dilution. However, I'm curious by the timing of this release. At this point, so much of the bad news has already been built into the SP. I'm tempted to hold till ER to see what numbers they release.
  • S
    SayWhat?
    Typical reaction following a stock consolidation, the stock falls to pre split levels.
    The good news (from the Board's perspective) is that they can now do more private placements to pay for RP2
  • T
    TurboJesus
    My early impression of the report is quite positive. Huge reduction in debt (28m), free cashflow of 18m....this looks quite good to me
  • J
    Jon
    Peru is going to nationalize mines and the oil sector. Ricus was right to sell Santander.
  • j
    jef
    Wow, looks like the “unexpected event” list previously posted wasn’t aa match for the management team at Trevali. Or perhaps they took it as a challenge to find something even more diabolical to hasten the evaporation of shareholder value. Nothing says confidence in your own ability like selling your assets to ANOTHER company and owning their shares. The massively overpriced management at Trevali should just quit and manage a hedge fund. There’s no evidence that they know how to run mining operations at a profit.
  • S
    SPARS2025
    The only person getting rich off this trash is the ceo. Why is he paying himself over 2 million a year? There are companies with multi billion dollar market caps that don't pay there ceo as much.
  • g
    gursharan
    Rosh Pinah Expansion will give them free cash flow of 471 million at 1.40/lb. Right now zinc price is 1.57. If inflation persisted for another 6-8 months than zinc can touch 1.90-2.50. With this, in my opinion, valuation should touch 1.5B-2.0 B
  • g
    gursharan
    Earnings coming. Post your guess. My guess is +0.02 and a positive cash flow of $75 million
  • J
    Jim
    Capitulation is done, the rs just finished off the stragglers, now TV can now run up to a more appropriate value that better reflects what has been invested and the growing revenues
  • S
    SDL
    10 to 1 consolidation
  • T
    TurboJesus
    This might be the breakout we're look for. I think Glencore has nearly exercised all its options if you consider the volume the last 5 trading days. Price action should be unlocked at this point. Way under priced.
  • C
    Corey
    Stock is just being ignored by the market. The leverage this has to higher zinc prices is very badly understood. Potential to be a 10 bagger if zinc prices are anywhere near this going forward.
    When a mid-high cost producer $1.00 per lb, sees the price rise from $1.10 to $1.60, their profit per lb goes from 10 cents to 60 cents, a factor of 6.
    Trevali is expanding production, and produced strong EBITDA last quarter at much lower zinc prices.
    A lot of long term holders are throwing in the towel (capitulation) right at the point of maximum upside.