Notes from Stockbox interview regarding EGM voting through Havieron Funding - 07 Oct 2022
Posted: Sun Oct 09, 2022 2:36 pm
Notes from Stockbox interview regarding EGM voting through Havieron Funding - 07 Oct 2022
Interview:
https://youtu.be/6mg1mKYh7J0
RNS regarding EGM outcome:
https://polaris.brighterir.com/public/g ... ry/rm347nx
Created from a messy YouTube transcript export
* Joining us today is Shaun Day the CEO of Greatland Gold, thank you very much for joining me Shaun how are you?
- really well thanks Mark thanks for having me on the program.
* It's good to be talking to you. I believe you are back in Australia after a recent week-long trip in the UK? How was the trip in the UK in general? Did you achieve what you wanted to?
- yeah look it was a really good trip on the ride
- just over two weeks ago we announced the new board the debt funding plus the equity so it was important to get out to shareholders
- I was actually in the USA at Denver gold the week before catching up with a lot of the US market then went through London to you know catch up with our shareholders both institutional plus a town hall or yeah I think it was really well received but important to do it.
* Okay excellent well of course you have had the results of the EGM today that was of course the resolution there to allot shares to enable the funding of that 35 million to complete with Wyloo Metals, so everything was passed successfully… you're very happy with the outcome?
- yeah look a really big turnout which was you know overwhelmingly exceedingly supportive of the resolutions which didn't surprise me because it was really essential to have that funding in the yeah in Greatland and be confident we were fully or well-funded for the Havieron development
- so you know a good outcome, I think it was a good transaction for shareholders and great to have that level of support and understanding in the shareholder base which dovetails back to your question Mark… why did I spend two weeks on the road?
- just to make sure I caught up with everyone.
* Excellent okay well that's good to hear that was approved so you can get that financing all sorted now I have a question that came in someone sent to me just regarding that actually assuming the approvals are received at the EGM which they have been and the funding goes ahead can you confirm that it is sufficient to reach the FCF (free cash flow) and avoid any further dilution? They say they have seen a number of miners lately who have secured debt financing months ago but come back to the market with additional raises citing buffer for inflationary pressures, so are the banks happy with GGP's cash position and are we genuinely fully funded?
- so it look it's a good question, I'll answer it in two parts so the second part first
- so in terms of other Banks happy… yes that's why we went out and raised the amount of equity we did that was part of the hurdle we had to jump over to make sure we could fully access that debt so I think an important milestone and perhaps it puts in the quantum of equity we raised in context
- in terms of are we fully funded, look super important question yeah I'm pleased it's been raised
- look I use the phrase well-funded, look you look at the amount of capex we needed in the pre-feasibility study it's 98 million, we've raised more than double that amount
- I think what we've done is positioned ourselves so I can say with absolute confidence that we're very well-funded, we're certainly fully funded for the pre-feasibility study
- I think we have a feasibility study which Newcrest continues to tell the market is coming out in the December quarter, so this quarter that we're presently in, I think in the back half of this quarter
- of course we'd like to see that feasibility study before we put in print we are fully funded but having a buffer having been aware of inflation being aware of the project development I think made us conservative in how we funded to give us confidence that we will be able to come out and say that is sufficient that is enough we are in a great position.
* Okay… well we can await that feasibility today, thank you for giving us a bit of a loose timeline on that, so that's December quarter towards the end of this year hopefully that will come out from Newcrest, just on Newcrest then and of course the new investor Wyloo.. I think that perhaps the assumption was that Newcrest would take this project all the way or indeed maybe take over Greatland Gold but does the.. do Wyloo throw a bit of a spanner in the works here? Is it a potential bidding war perhaps that might happen?
- Another great question and thanks
- look I think it's always good to have competitive tension in the case of competing bids
- we think we have a world-class asset in Havieron next to infrastructure in a tier one jurisdiction so we think.. you know it would appeal to a huge range of investors and strategic investors
- I think orthodoxy has always been that Newcrest would have a great interest in consolidating you know ownership and I think for that reason we've always felt there's asymmetrical risk in our share price
- if we're not successful at promoting the company, at moving up our market value with the evolution of Havieron as we continue to de-risk and grow it at some point you know a takeover hammer could fall
- conversely we like to think of that if we’re successful at articulating the opportunity at Havieron at least theoretically there's virtually unlimited upside
- so I yeah that's what I think is one of the attractions of our stock, there is this asymmetrical risk and I think you can now see a situation where the window to buy us opportunistically is perhaps closed because there are multiple well-financed parties that have an interest in the project
- so and I think that's good for shareholders.
* Yeah well, a very good position to be in for sure, I think it's enviable for a lot of other mining companies out there who aspire to achieve a similar situation. I wonder if I could just talk to you a little bit about the recent new board appointments at director's appointments, what can you tell me about that is that part of the sort of longer-term plan here with GGP?
- yeah very much you've got… I’m a huge believer in having quality teams and I think the board we have would be the equal of any in the country
- it is an exceptional board we have Jimmy Wilson joining in an executive role part-time executive role but he ran a number of divisions in the world's largest minor BHP including well nickel but also BHP there you know which is a huge you know a huge value division
- I think widely seen as to 2IC (second in command) and really an amazing operator within BHP to have him on the team in that leadership role as outstanding
- Deputy chair joining on all before first of January Elizabeth Gaines just stepped down as managing director and CEO of top 10 Australian minor Fortescue, ASX top 10, a 50 billion dollar company… you know presided over an amazing period of growth and strengthening of Fortescue both operationally and from a balance sheet perspective, her credentials including her kind of broader private equity and strategic background you know are a huge bonus to the company
- and then come joining as chairman from the 1st of January you know in a very orderly kind of transition is Mark Barnaba ex-global head of Macquarie resources investment Bank, together with Deputy chair of Fortescue again, ASX top 10 company and then also sits on the board of The Reserve Bank of Australia, our bank of England
- so yeah again an extraordinary you know individual and strategic Insight I've you know been speaking to Mark and really that whole team over the past 12 months and you know to have that kind of horsepower and capability and strategic view and access to capital on our board I think really distinguishes ourselves from our peers
- and perhaps in a market where access to capital is tighter that creates another competitive advantage for Greatland in addition just to having that level of strategic input into how we conduct ourselves to make the most of what we have both in terms of opportunities and to make the most of the asset platform including Havieron.
* Excellent well significant board appointments there as you say and I followed the Greatland story for many years, it's fantastic to see the company in this position with the funding behind it there and of course the project that you've got.. you know the resource that is there. I wonder if I can perhaps just finish off by maybe getting your vision if you can, it might have to be very loose but maybe you have some more specific objectives over the next two to three years, we've said there doing this interview that you're well-funded, the feasibility studies coming out this December quarter so what are the main things you're looking out for over the next two to three years? Is it possible at this stage at all as well to put a.. to give an idea of valuation or is that really dependent on that feasibility study?
- well look let me talk to it around our strategic and growth framework which has three pillars
- one is to deliver an expanded Havieron and when I think about Havieron in a three-year time frame and this talks to value Mark…it is I think in 18 months times we will be in production, I think that's a significant.. the derisking and value creation event, say 18 months after that will be… have ramped up to that 3 to 4,000 ounce per annum including copper production profile
- now that is also… you're going to see really strong free cash flows coming through, again a huge de-risking event, I think we walk up the value curve through that process
- in addition to that in that same three year window you'd expect us to come out with say a pre-feasibility study on the next stage of Havieron development and advancement into that bulk mine so I think there's a huge organic growth window with Havieron over the next three years
- pillar two of our strategic strategy is to continue to invest in the drill bit, there is no better place to look for gold and copper than where it's already been found
- we hold tenements for long strike from Havieron, we really want to unlock the option value in that by continuing to undertake exploration drilling and again this funding allows us potentially to accelerate that, so that's very exciting and again you know striking another Havieron would be simply stunning
- but next to infrastructure that hurdle for economic value was decreased so if it's a half Havieron or even a quarter Havieron you still created a huge amount of shareholder value, so I think that's another really important pillar to our strategy
- and then thirdly the inorganic growth opportunities
- we have this amazing group of team.. both at the board level plus I'm really proud of what we've put together at a management level at and the capacity that we've put together, which is how we were successful you know in terms of executing the funding, navigating the option process with Newcrest and having what I think was a hugely successful last 12 months
- but I think having that team, having that access in terms of the Rolodex of the directors in the team here, having the access to capital both with Wyloo & Tribeca that cornerstone the equity raising
- but also just the.. I think the attraction that Greatland now you know has with funds and again we've seen that increasing institutionalisation of our share registry supporting the strength of the existing retail base
- so I think all of that in what could be a difficult market or what is presently a difficult market having that advantage in terms of access to capital I think puts us in a fantastic position to be a counterparty of choice with other opportunities in the in the sector.
* Excellent well that's a nice summation there, you've made it quite clear… 18 months into production and then another 18 months, so that's your three years there getting to that 3-4000 ounces of production per year, so yeah that's pretty short really in mining terms for investors anyway in that space, that's a pretty quick timeline. Further resource discovery and building out on the team and of course the operations into a significant company, so very good to hear that Shaun, thank you very much for giving me your time today, just getting a catch up there Shaun Day the CEO of Greatland Gold, thank you very much for your time.
- Mark, thanks again for the opportunity, I enjoyed the discussion.
Download link:
https://www.mediafire.com/file/3qm7x2bg ... 2.pdf/file
Interview:
https://youtu.be/6mg1mKYh7J0
RNS regarding EGM outcome:
https://polaris.brighterir.com/public/g ... ry/rm347nx
Created from a messy YouTube transcript export
* Joining us today is Shaun Day the CEO of Greatland Gold, thank you very much for joining me Shaun how are you?
- really well thanks Mark thanks for having me on the program.
* It's good to be talking to you. I believe you are back in Australia after a recent week-long trip in the UK? How was the trip in the UK in general? Did you achieve what you wanted to?
- yeah look it was a really good trip on the ride
- just over two weeks ago we announced the new board the debt funding plus the equity so it was important to get out to shareholders
- I was actually in the USA at Denver gold the week before catching up with a lot of the US market then went through London to you know catch up with our shareholders both institutional plus a town hall or yeah I think it was really well received but important to do it.
* Okay excellent well of course you have had the results of the EGM today that was of course the resolution there to allot shares to enable the funding of that 35 million to complete with Wyloo Metals, so everything was passed successfully… you're very happy with the outcome?
- yeah look a really big turnout which was you know overwhelmingly exceedingly supportive of the resolutions which didn't surprise me because it was really essential to have that funding in the yeah in Greatland and be confident we were fully or well-funded for the Havieron development
- so you know a good outcome, I think it was a good transaction for shareholders and great to have that level of support and understanding in the shareholder base which dovetails back to your question Mark… why did I spend two weeks on the road?
- just to make sure I caught up with everyone.
* Excellent okay well that's good to hear that was approved so you can get that financing all sorted now I have a question that came in someone sent to me just regarding that actually assuming the approvals are received at the EGM which they have been and the funding goes ahead can you confirm that it is sufficient to reach the FCF (free cash flow) and avoid any further dilution? They say they have seen a number of miners lately who have secured debt financing months ago but come back to the market with additional raises citing buffer for inflationary pressures, so are the banks happy with GGP's cash position and are we genuinely fully funded?
- so it look it's a good question, I'll answer it in two parts so the second part first
- so in terms of other Banks happy… yes that's why we went out and raised the amount of equity we did that was part of the hurdle we had to jump over to make sure we could fully access that debt so I think an important milestone and perhaps it puts in the quantum of equity we raised in context
- in terms of are we fully funded, look super important question yeah I'm pleased it's been raised
- look I use the phrase well-funded, look you look at the amount of capex we needed in the pre-feasibility study it's 98 million, we've raised more than double that amount
- I think what we've done is positioned ourselves so I can say with absolute confidence that we're very well-funded, we're certainly fully funded for the pre-feasibility study
- I think we have a feasibility study which Newcrest continues to tell the market is coming out in the December quarter, so this quarter that we're presently in, I think in the back half of this quarter
- of course we'd like to see that feasibility study before we put in print we are fully funded but having a buffer having been aware of inflation being aware of the project development I think made us conservative in how we funded to give us confidence that we will be able to come out and say that is sufficient that is enough we are in a great position.
* Okay… well we can await that feasibility today, thank you for giving us a bit of a loose timeline on that, so that's December quarter towards the end of this year hopefully that will come out from Newcrest, just on Newcrest then and of course the new investor Wyloo.. I think that perhaps the assumption was that Newcrest would take this project all the way or indeed maybe take over Greatland Gold but does the.. do Wyloo throw a bit of a spanner in the works here? Is it a potential bidding war perhaps that might happen?
- Another great question and thanks
- look I think it's always good to have competitive tension in the case of competing bids
- we think we have a world-class asset in Havieron next to infrastructure in a tier one jurisdiction so we think.. you know it would appeal to a huge range of investors and strategic investors
- I think orthodoxy has always been that Newcrest would have a great interest in consolidating you know ownership and I think for that reason we've always felt there's asymmetrical risk in our share price
- if we're not successful at promoting the company, at moving up our market value with the evolution of Havieron as we continue to de-risk and grow it at some point you know a takeover hammer could fall
- conversely we like to think of that if we’re successful at articulating the opportunity at Havieron at least theoretically there's virtually unlimited upside
- so I yeah that's what I think is one of the attractions of our stock, there is this asymmetrical risk and I think you can now see a situation where the window to buy us opportunistically is perhaps closed because there are multiple well-financed parties that have an interest in the project
- so and I think that's good for shareholders.
* Yeah well, a very good position to be in for sure, I think it's enviable for a lot of other mining companies out there who aspire to achieve a similar situation. I wonder if I could just talk to you a little bit about the recent new board appointments at director's appointments, what can you tell me about that is that part of the sort of longer-term plan here with GGP?
- yeah very much you've got… I’m a huge believer in having quality teams and I think the board we have would be the equal of any in the country
- it is an exceptional board we have Jimmy Wilson joining in an executive role part-time executive role but he ran a number of divisions in the world's largest minor BHP including well nickel but also BHP there you know which is a huge you know a huge value division
- I think widely seen as to 2IC (second in command) and really an amazing operator within BHP to have him on the team in that leadership role as outstanding
- Deputy chair joining on all before first of January Elizabeth Gaines just stepped down as managing director and CEO of top 10 Australian minor Fortescue, ASX top 10, a 50 billion dollar company… you know presided over an amazing period of growth and strengthening of Fortescue both operationally and from a balance sheet perspective, her credentials including her kind of broader private equity and strategic background you know are a huge bonus to the company
- and then come joining as chairman from the 1st of January you know in a very orderly kind of transition is Mark Barnaba ex-global head of Macquarie resources investment Bank, together with Deputy chair of Fortescue again, ASX top 10 company and then also sits on the board of The Reserve Bank of Australia, our bank of England
- so yeah again an extraordinary you know individual and strategic Insight I've you know been speaking to Mark and really that whole team over the past 12 months and you know to have that kind of horsepower and capability and strategic view and access to capital on our board I think really distinguishes ourselves from our peers
- and perhaps in a market where access to capital is tighter that creates another competitive advantage for Greatland in addition just to having that level of strategic input into how we conduct ourselves to make the most of what we have both in terms of opportunities and to make the most of the asset platform including Havieron.
* Excellent well significant board appointments there as you say and I followed the Greatland story for many years, it's fantastic to see the company in this position with the funding behind it there and of course the project that you've got.. you know the resource that is there. I wonder if I can perhaps just finish off by maybe getting your vision if you can, it might have to be very loose but maybe you have some more specific objectives over the next two to three years, we've said there doing this interview that you're well-funded, the feasibility studies coming out this December quarter so what are the main things you're looking out for over the next two to three years? Is it possible at this stage at all as well to put a.. to give an idea of valuation or is that really dependent on that feasibility study?
- well look let me talk to it around our strategic and growth framework which has three pillars
- one is to deliver an expanded Havieron and when I think about Havieron in a three-year time frame and this talks to value Mark…it is I think in 18 months times we will be in production, I think that's a significant.. the derisking and value creation event, say 18 months after that will be… have ramped up to that 3 to 4,000 ounce per annum including copper production profile
- now that is also… you're going to see really strong free cash flows coming through, again a huge de-risking event, I think we walk up the value curve through that process
- in addition to that in that same three year window you'd expect us to come out with say a pre-feasibility study on the next stage of Havieron development and advancement into that bulk mine so I think there's a huge organic growth window with Havieron over the next three years
- pillar two of our strategic strategy is to continue to invest in the drill bit, there is no better place to look for gold and copper than where it's already been found
- we hold tenements for long strike from Havieron, we really want to unlock the option value in that by continuing to undertake exploration drilling and again this funding allows us potentially to accelerate that, so that's very exciting and again you know striking another Havieron would be simply stunning
- but next to infrastructure that hurdle for economic value was decreased so if it's a half Havieron or even a quarter Havieron you still created a huge amount of shareholder value, so I think that's another really important pillar to our strategy
- and then thirdly the inorganic growth opportunities
- we have this amazing group of team.. both at the board level plus I'm really proud of what we've put together at a management level at and the capacity that we've put together, which is how we were successful you know in terms of executing the funding, navigating the option process with Newcrest and having what I think was a hugely successful last 12 months
- but I think having that team, having that access in terms of the Rolodex of the directors in the team here, having the access to capital both with Wyloo & Tribeca that cornerstone the equity raising
- but also just the.. I think the attraction that Greatland now you know has with funds and again we've seen that increasing institutionalisation of our share registry supporting the strength of the existing retail base
- so I think all of that in what could be a difficult market or what is presently a difficult market having that advantage in terms of access to capital I think puts us in a fantastic position to be a counterparty of choice with other opportunities in the in the sector.
* Excellent well that's a nice summation there, you've made it quite clear… 18 months into production and then another 18 months, so that's your three years there getting to that 3-4000 ounces of production per year, so yeah that's pretty short really in mining terms for investors anyway in that space, that's a pretty quick timeline. Further resource discovery and building out on the team and of course the operations into a significant company, so very good to hear that Shaun, thank you very much for giving me your time today, just getting a catch up there Shaun Day the CEO of Greatland Gold, thank you very much for your time.
- Mark, thanks again for the opportunity, I enjoyed the discussion.
Download link:
https://www.mediafire.com/file/3qm7x2bg ... 2.pdf/file