LYC - Lynas Rare Earths

[Coppertop]

HI there,

My first post here.

Still trying to get my head around the forum, format etc, as I am used to posting on a different forum.

Yes I agree with a previous poster (not sure who...as mentioned just trying to get used to this forum) in regard to the announcement. For my mind, Lynas has historically, whether by accident or otherwise, had a history of convoluted, difficult to understand or just plain vague announcements.

THe CEO has previously advised of the ramp up timetable as he sees it. Given we are at the maiden point in this (effectively) one needs to make an allowance for the fact that in any given quarter, there is always (as in any business) going to be stock held over for sale into the next quarter.

For instance, production numbers aside, it would be reasonable to think that your output or tonnage produced and to spec on say December 31, isn't to be sold and banked in October-December Quarter. Therefore on a rolling basis, quarterly output > sales is going to cross your traditional quarterly timelines (Jan-March, April-June, July Sept, Oct-Dec).

Thus, any sales arising from the December output tonnage will effectively reflect in Q1. Any tonnage output in say March will reflect in Q2 etc etc.

Not sure if/where the "stock Held" button is, but as far as disclosure goes, I hold stock in Lynas Corporation Limited.

 

[budfox26]

What is happening with LYC?

Been holding stock in this company for more than 2 years now. Bought at $1.20ish. Went up 20% the day after I bought it and I wish I sold it.

It's just been sitting around the 29 cent mark for ages. I have no idea whats happening with this company either because I can't understand the announcements.

I guess this is punishment for buying into a stock in an industry I know nothing about.

Will stick to tech.

 

[BeeEater]

To Coppertop,
Did you get banned from HC, LOL ?

To All,
I think there was a recent bad article in Motley Fool.
LYC has been a real dog of a stock.
I feel like a flea on the back of a real dog.

PS - can't find the STOCK HELD button either.

 

[pixel]

In case you missed it: http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01549530
LYC finally got their license ... at least for two years.

Market reacts with approval, and I thought it may be worth a punt.



Started buying at average 17c; target could go as high as 23; initial stop 15c

 

[burglar]

To Coppertop,
Did you get banned from HC, LOL ?

To All,
I think there was a recent bad article in Motley Fool.
LYC has been a real dog of a stock.
I feel like a flea on the back of a real dog.

PS - can't find the STOCK HELD button either.

Most of us here, back a dog from thyme to thyme.
We aren't always proud to admit it!

But if you feel the need!!



Disclosure: I don't hold!

 

[pixel]

Most of us here, back a dog from thyme to thyme.
We aren't always proud to admit it!

But if you feel the need!!

Disclosure: I don't hold!

When LYC dropped back a cent after I had bought in early, I used some language that Rosemary would have disapproved of. Luckily, after some Thyme the sp recovered, and I even added in the end.



Now, 17c has been resistance 2 weeks ago; it is therefore still possible that today turns out a false break (which is actually a misnomer. "deceptive" or "unsustained" would describe the action much better.)
Should LYC fail to get on with it, I'd stop out quickly: definitely if sellers pushed the Close Below 16c.

 

[shanepu]

LYC - HotCopper Down

With HotCopper down, where have the feuding bloggers gone?
There shareprice is on a well controlled slow downward trajectory, but with plenty of support at 11.5 and 11 cents.
The bots are being patient and everyone is playing a waiting game.

 

[shanepu]

Re: LYC - HotCopper Down

With HotCopper down, where have the feuding bloggers gone?
There shareprice is on a well controlled slow downward trajectory, but with plenty of support at 11.5 and 11 cents.
The bots are being patient and everyone is playing a waiting game.

HotCopper was soon up again. For next time, HotCopper NZ runs like a mirror.

 

[pixel]

What a lead balloon that turned out to be



If it plays out as a Head'n'Shoulders pattern, the target will be exactly zero
On the other hand, if support holds at 11c, it could turn out one of the Buys of the Year.
watching ...

PS: Welcome aboard, ShanePU
We're a very civilised and friendly bunch; no feuding here. ... well - not much anyway.

 

[skc]

What a lead balloon that turned out to be

If it plays out as a Head'n'Shoulders pattern, the target will be exactly zero
On the other hand, if support holds at 11c, it could turn out one of the Buys of the Year.
watching ...

PS: Welcome aboard, ShanePU
We're a very civilised and friendly bunch; no feuding here. ... well - not much anyway.

LYC is having some major debt issues that threatens its existence. So a price target of zero may not be that silly.

Having said that, it is a somewhat stratregic asset so I think there will be punters coming to its rescue. Existing equity holders might not get much joy out of it however.

 

[pixel]

LYC is having some major debt issues that threatens its existence. So a price target of zero may not be that silly.

Having said that, it is a somewhat stratregic asset so I think there will be punters coming to its rescue. Existing equity holders might not get much joy out of it however.

Trading Halt.
"integrated funding package"

here's hope for survival

 

[skc]

Trading Halt.
"integrated funding package"

here's hope for survival

Yes. Announcement out. They will survive for a bit longer.

The question is... will it open higher or low? For a company teetering on survival, it still has a market cap over $250m. On the bright side, it survived this time and the new schedule gives LYC a chance to turn operations in the cash flow positive. The negative is that, there will be a capital raising to come, and the quarterly reports will now be scrutinised more than ever.

At end of last quarter LYC had $38m ($33.3m unrestricted) in cash, and loss -$23m in operating cash flow. So by the end of the Sept quarter, if they lose another $20m in op cashflow, and repay $10m loan, they'd have nothing left. So you'd expect them to raise at least enough money for 6-9 months of operations and interests and loan repayments. That'd be ~$70-100m. To get that sort of deal away in an underwritten cap raising, I am going to guess a 1-for-3 rights issue @ 8.5c plus a $25m placement (raising $90m).

Here's a good article about the plight of LYC.

http://www.forbes.com/sites/timwors...-the-great-rare-earth-shortage-is-truly-over/

 

[herzy]

At end of last quarter LYC had $38m ($33.3m unrestricted) in cash, and loss -$23m in operating cash flow. So by the end of the Sept quarter, if they lose another $20m in op cashflow, and repay $10m loan, they'd have nothing left. So you'd expect them to raise at least enough money for 6-9 months of operations and interests and loan repayments. That'd be ~$70-100m. To get that sort of deal away in an underwritten cap raising, I am going to guess a 1-for-3 rights issue @ 8.5c plus a $25m placement (raising $90m).

Here's a good article about the plight of LYC.

How does a short position get affected when a rights issue and placement occurs? I could probably think it through but don't have the mental acuity at the moment ...

 

[skc]

How does a short position get affected when a rights issue and placement occurs? I could probably think it through but don't have the mental acuity at the moment ...

Placement... usually nothing.

Rights... the shorter basically has to give the holder the "rights". Say if they do rights issue at 8c and the stock holder decided to take up those rights, it'd be the shorter who must honour that. So the short need to deliver additional shares to the owner @ 8c.

Do you have a short on LYC? Where can you still source that?

P.S. LYC up 23% in the US OTC. But volume is pretty small there.

 

[herzy]

Do you have a short on LYC? Where can you still source that?

P.S. LYC up 23% in the US OTC. But volume is pretty small there.

No I don't, I'm just trying to learn/absorb as much as possible organically and hopefully leverage that knowledge base in future based on the assumption that scenarios/circumstances and history tend to repeat themselves. Thanks for the response!

 

[pixel]

Trading Halt.
"integrated funding package"

here's hope for survival

Suspension.
As expected, the debt package will be complemented by a fund raising effort.
Let's then start with a clean sheet on Monday.

 

[skc]

Suspension.
As expected, the debt package will be complemented by a fund raising effort.
Let's then start with a clean sheet on Monday.

Good to see they will get equity raising sorted before re-open again. It would be the blind leading the blind if they trade prior to the equity raising is firmed up. (Not to mention HC will explode...)

 

[pixel]

5-for-14 renounceable issue at 8cps plus 1 option per 2 subscribed shares, strike 9c by September 2015.

Could turn out attractive enough, especially as it's fully underwritten. Wait & See.

 

[skc]

5-for-14 renounceable issue at 8cps plus 1 option per 2 subscribed shares, strike 9c by September 2015.

Could turn out attractive enough, especially as it's fully underwritten. Wait & See.

My random guess of 1-for-5 @ 8.5c + $20m placement was pretty close .

With the head trading at 8.7/8.8, the buffer is only 0.7c now and it is simply not enough imo for the retail holder to stump up the money, especially considering that every one of them are at a loss. It might however be a good opportunity for some players with big short positions to cover some of the shorts via the capital raising.

 

[pixel]

My random guess of 1-for-5 @ 8.5c + $20m placement was pretty close .

With the head trading at 8.7/8.8, the buffer is only 0.7c now and it is simply not enough imo for the retail holder to stump up the money, especially considering that every one of them are at a loss. It might however be a good opportunity for some players with big short positions to cover some of the shorts via the capital raising.

smart thinking, skc
ASIC reports 133M short LYC. Is it worth guessing who might be behind all that, wishing the pox on LYC?