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TNG 15.5¢

multi-pronged strategy

  1. Key Points
    • Strategic expenditure reductions implemented covering both remuneration, corporate and administrative overheads and project reviews, including:
    • 10-20% reduction in fees and salaries for Directors, management and staff;
    • Corporate and administrative cost savings including a reduction in head count in WA and Northern Territory; and
    • Reductions in supplier contracts.
    • Further cost savings implemented following transfer of management of the Mount Peake Definitive Feasibility Study in- house and decision to defer completion until Q1 2014.
    • Alternative exploration and development scenarios under consideration for all projects.
    • Changes designed to streamline TNG’s operations in the current difficult market and ensure that it can cost effectively progress its key assets to create shareholder value.

    more details in the announcement


    About time !!

  2. Great news - this is exactly what we need to get the focus in the right area

  3. I agree, this is the correct thing to do, better late than never.

    UM

  4. ToH

    173 posts.

    This might be "too little, too late".
    I sincerely hope not but short on cash, SP too low to attact capital and significant cash burn to get any revenue from production, doesn't bode well.
    I'm down too far to sell out now, so I'll ride it to the end.
    Good luck to all.

  5. Pokerface

    3,612 posts.

    I completely disagree ToH. The Update is extremely positive. I do not think you could expect more from management at this stage. The share price is very disappointing, of course, but, I maintain we would only need a serious deal to be done on the Mt Peake finance front, and this would rocket.

    All the measures they have put in place make sense, and this buys the company a lot of time to get an appropriate deal done.

  6. "this buys the company a lot of time to get an appropriate deal done."

    When did they start working on Mt Peake ?

    When did the Chinese come on board ?


    How much more time do they need ?

  7. Anyone criticizing management for not doing this sooner is using the luxury of hindsight.

    Mt Hardy was worth the gamble, it hasn't paid off (yet). It has not returned strong enough results early on, therefore management have made the right call to essentially put the company on ice other than Mt Peake.

    If Mt Hardy returned some astounding drill results we would be raising at 15-20cents right now (or higher).

    The lights only need to be kept on around the office for the sake of Mt Peake.

    Management are clearly aware of their situation, and have raised the cash as early as possible with whatever bargaining power they have left in an appalling market.

    We all bought a ticket on this rollercoaster for Mt Peake, and you must all know that the hopes of this company starts and ends with this one project. Therefore, the situation now is no different to when you originally hit 'buy'. Mt Peake will be a sink or swim scenario. I rest easy knowing I bought TNG at 9.7cents 2 years ago with the intention to see this through long term.

    End of Q1 2014 is not very far away now!

    The only things I would query would be:

    A) They obviously intend on raising more capital from somewhere. This announcement certainly improves TNG's bargaining power for an institutional placement, but this would still be disastrous for the SP. Perhaps the sell off of tenements is being considered in lieu of another placement?

    A joint venture in Mt Hardy would be interested, perhaps they could offer a large slice of the tenement in return for an up front payment (to act as payment for the work TNG has put into the tenement to date).

    B) Staff have been reduced by 5, does this result in redundancies that take a chunk out of the company coffers? Or were they merely casual staff that were politely shown the door?

    Still a hold for me until I finally get some closure on Mt Peake.

  8. Sasha39

    292 posts.

    “Anyone criticizing management for not doing this sooner is using the luxury of hindsight.”
    Sorry but NO!
    Anyone who dared to criticize or to air their concerns about some of the decisions made by management were labelled negative and windgers, but that’s’ what makes a forum, varying view points.
    Sadly it looks like the windgers might have been correct with some of their concerns and unfortunately I am saddened by today events, you see it as a positive move and I see it as a move of desperation which has now been flagged to all and sundry, so a takeover will be on the cards.
    I know you may not like my view point but sometimes you have to listen to another’s view point, we all can’t wear rose coloured glasses, on the 4th July I wrote “but there are other alternatives like selling some of the other projects or farm-in partners for these projects to top up the bank balance and keep Mount Peake alive” is this what management is doing now? On the 19th July I wrote and I admit that I was a few weeks out but, ”The way things are going the buyers sitting @.037 might be able to pick up by mid next week” did that not happen this week? So hindsight no, fortune teller maybe.
    The main thing is that we all have lost money and some of us many not recover the full amount of our investment in TNG, I sincerely hope that I am wrong and I would glad to be wrong, still holding, what else can I do? and praying much harder.

  9. S

    good post. some people don't like alternative views and must be personal in reply.
    In reality that is a waste of time and effort.

    I personally like todays announcement, but I have heard rumours of this for a few weeks, so it is interesting that it is announced today, AFTER the SPP>

    anyhow, PF and others are correct, financing Mt Peake is the key issue. I personally hope PB can do that, but very much doubt he can.

    I have dozens of questions on TNG, hopefully in the fullness of time Management will see their way clear to keep the market FULLY informed.

    UM

  10. Sasha39

    292 posts.

    UM
    I agree fully, we all need Mt Peake to be a success, but I fear that the low SP is making us a Takeover target and the terms may not be to our liking.
    Good luck to us all.

  11. Sasha39

    292 posts.

    UM
    I agree fully, we all need Mt Peake to be a success, but I fear that the low SP is making us a Takeover target and the terms may not be to our liking.
    Good luck to us all.

  12. igilug

    1,533 posts.

    May time be the best judge!
    We who have invested; some more some less, have a duty within, to address concerns, some see it one way others other ways, each to their own investment.

  13. Desperation is not the right word, necessity yes.

    TNG is an explorer. Crucify them for spending cash and EXPLORING *gasp* all you like. But if you want a stable 10-20% profit then have a look at BHP, RIO.

    The nature of the beast is it is a very hard market to raise in. You are picking a very easy argument to criticize management and call this an act of desperation.

    What else would you have them do? Rewind to 12-24months ago. Should Management have shut up shop and made an announcement they were stripping down to a skeleton crew in order to use minimal funds for 2-3years while they focused on Mt Peake?

    Good luck keeping share holders interested in a company of that nature. Exploreres explore. Now TNG are trying to move into the next stage into a mid tier producer.

    Small companies have to take risks to engage market interest and get people investing.

    I am not looking through Rose tinted glasses. I am very aware I am down 50% on my original investment, I remain emotionless on that fact. My remaining investment could very likely be worth 0 some day if Mt Peake cannot be financed. Vanadium is not the 'flavour of the month' resource that will boom like Sirius and Tin. And that's the challenge that has always faced TNG's Management. But that's small caps.

    No sense at all to be shaken out every time a small cap hits its low just before you find out if it'll make it or not.

    The way I see it, this car has enough fuel in the tank to at least get it to the next station (or at the very least, they can start throwing luggage out the back to conserve fuel to make sure we get there). Takeover is of no concern until it is confirmed that financing cannot be achieved (which would mean the swift demise of TNG anyway).

    DFS and Mt Peake financing are now the sole order of business, and near enough in the future that we need not concern ourselves with the rest of the portfolio until we sink or swim.

    Worth the hold for me, but if you are concerned for the companies future might I suggest selling and minimizing your losses?



  14. jvest13

    125 posts.

    Nice post $c....good to see some commonsense prevailing in respect to the management actions to secure cashflow for the critical months ahead for Peake.

    Strongly agree with you that this is an extremely difficult market for the majority of junior miners trying to continue exploration within challenging cashflow conditions.

    Hindsight would allow us to argue that TNG Management should have focused on Peake first and run the multi exploration strategy second. Isn't it curious that we always have perfect vision after the fact?

    Have those HC contributors who knock the actions of TNG management ever actually been in a tough management scenario themselves (or ever been in a key decision making role in a challenging financial environment for that matter)? This is a tough gig.

    Ironically, when Peake comes out the other side, we will probably only hear applause from the same detractors, if they are still around!

    Like you, I am significantly down on my investment but try to remain unemotional about that.

    IMO, we now have the cashflow needed to take us through to the completion of the DFS and hopefully the completion of the peer review.

    It's obviously an individual decision, but agree with you that those who conclude they can't stand the heat, or don't like the forward strategy etc. etc. should minimize their losses.

    I know this will be boring for some, but the bottom line is that we have a measured resource. It has a significant LOM value & strong NPV with upside. Known global Vanadium resources are limited versus potential demand. The global Vanadium price is predicted to move up from 2015 and beyond as a consequence. Drivers identified include sophisticated battery technology to match efficiency & tougher environmental standards & re-bar steel standards in China to meet legal earthquake requirements in construction.

    IMO, many of the other junior Aussie miners currently exploring and struggling with cashflow are not in a similar position to TNG. They are many moons from completing a DFS within a couple of quarters.

    Remain positive fellow shareholders.

    Cheers to all.

    Jvest

    BTW, wouldn't it be a bonus if we have a new economic zone with advantageous economic incentives for NT based explorers...under the white paper of course!

  15. Pokerface

    3,612 posts.

    Dollarsandsense, in actual fact TNG is a bit more than just an "explorer". We (I feel part of this) are a very successful explorer with a defined deposit and with a developed patented process which means that we have an extremely marketable set of end products. Moreover our Mt Peake project has an exceptional NPV which must surely be over $3b since the depreciation of the A$.

    I take on board all that you say, and perhaps because I have been a serious shareholder for almost 10 years I am wearing those rose tinted glasses you speak of, but,I remain extremely hopeful that the Board can bring this project forward such that real value is achieved for the shareholders.

    They have battened down the hatches and are focussing the energies on the project which has fabulous projected cash flows. at full tilt, in excess of $300m per year for goodness sake!

    I feel a breakthrough is not that far away.

    A change of Government could be extremely timely. We are but a few weeks away from that assuming the betting agencies are on-song. I think Centrebet has the Coalition at $1.16 and the incumbents at $5...forget the polls...the punters know best! This change will surely assist any offshore discussions. I am sure that the current government has scared the living dalylights out of the International Investing community. As soon as they are dispatched, sensible negotiations may ensue!

    Long live TNG !!

  16. nicholls5

    595 posts.

    Yes PF the fundamentals have not changed one bit. I think what brings out the naysers is that they see that $1000 trade that can drop the SP to 3.7c and out they come with all that is wrong with TNG. They look at the SP - we look to the future with our rose coloured glasses firmly focused on the future and not on the current SP.

  17. "A change of Government could be extremely timely. We are but a few weeks away from that assuming the betting agencies are on-song. I think Centrebet has the Coalition at $1.16 and the incumbents at $5...forget the polls...the punters know best! This change will surely assist any offshore discussions. I am sure that the current government has scared the living dalylights out of the International Investing community. As soon as they are dispatched, sensible negotiations may ensue!"

    Almost wetting my pants laughing - you made my day - thank you


    "TNG RAISES $2.8M AND COMMISSIONS KEY PILOT PLANT TESTWORK PROGRAM FOR MOUNT PEAKE IRON-VANADIUM PROJECT"
    "$2.8M share placement to accelerate development of Mount Peake Project (Northern Territory)
    • TNG commissions next phase of metallurgical test work and pilot plant studies on newly developed hydrometallurgical process
    • Results to be fed into expanded Scoping Study currently underway
    • New phase of test work follows signing of non-binding MOU with leading Chinese State-owned engineering, development and construction group"

    March 2011

  18. Agreed PF, TNG deserve more than the label of 'explorer'. I guess my argument is that if you have a huge project that is years in the future you do not sit on your hands, you spend money and develope your portfolio while progressing with the main task.

    Mt Peake is now on the horizon, so priorities have changed. Perhaps earlier than I would have liked, but the current market has forced management into this decision early.

    No sense crucifying management over this, it is what it is.

    I remain confident as ever that management will see this through. It's up to the individual to decide whether they believe financing can be delivered to generate shareholder value.

    This will float at 38-40c range for some time now, potentially all the way to DFS and beyond. Plenty of time to top up, which is why we currently see no resistance to the sell side.

    I made my original investment to see this through, I may top up closer to DFs, but at the moment I am at my upper limit for exposure in small caps. I would recommend this stock to anyone wanting to buy into a small cap though, fundamentals continue to improve, and the management's resolve and focus remains steadfast.

  19. ando1

    544 posts.

    May I asked what medication your on Dollarsandsence?

  20. coopers

    365 posts.

    Yeah. Think you're a decimal point out Dollarsandsence.

  21. echome

    7 posts.

    Dollarsandsense is hallucinating again. A company trumpet.
    MB milked it to the max and the cupboard's nearly empty.
    What a joke the general commentary is. It's the government's fault! The company had to explore other options to keep the punters interested! Don't crucify management! They're just explorers anyway!
    The way I see it, the company went off chasing rainbows instead of concentrating on it's prime asset Mt Peake and now it is slowly bleeding to death as a result. Greed? Stupidity? Or part of a ' Master Plan' ? I wonder....

  22. Sasha39

    292 posts.

    Come on guys lets’ hope he it right 38 – 40 sound better than .038 - .040 but sadly the last trade was at .036 The truly sad part is that he still thinks that management have done a great job.
    D+S stated Desperation is not the right word, necessity yes, regarding yesterdays’ announcement can I ask those of you that work for a boss when was it the last time that your boss cut his own pay packet? It happened to me and 2 weeks later the company that I worked for went bust! Are they cutting their own wages for the benefit of you and me or are they trying save their own skins.
    These are desperate times for TNG and management know it, they know that they should have focused on Mt Peake and forgotten about their multi exploration strategy so as to conserve the funds needed to get Mt Peake over the line, by their actions they have diluted the SP to where is it today and have nobody but themselves to blame, and please don’t talk to me about Hindsight, posts about managements decisions were posted at the time of the decisions being made and were labelled as negative, wingers and not understanding the strategy, so hindsight NO! maybe Foresight?

  23. hi Sasha, good to see you getting "smarter" ;)

  24. Pokerface

    3,612 posts.

    S39, I believe they will have in excess of $6m, without further raising from the shortfall. They have effectively stopped any further expenditure on exploration, and shaved corporate overheads. They are concentrating on getting a deal done on the very advanced Mt Peake project. I am not sure how long $6m would last, but I presume it is well over a year, perhaps 2 years. I understand they have been in discussion regarding project funding etc for many months with a number of parties, and I gained the distinct impression from the last face to face update that we are not a million miles away from something solid and which if delivered would put an absolute rocket under the shareprice.

    In many ways, it would probably do us all a favour for HC to shut down for a few months, we all take a holiday from looking at the share price, and come back to it when and if the project funding has been consummated. (Of course, for those who may wish to accumulate, potentially not a bad time) We can argue til the cows come home about what or what not ought to have been done. History is history, and in event, my understanding is that funds were expended on the copper exploration for very valid reasons with underlying expectations around other funding which did not eventuate (is that cryptic enough for everyone!)

    I am off to a well deserved lunch!

  25. echome

    7 posts.

    PF another hallucinatng company trumpet.

  26. Sasha39

    292 posts.

    echome
    PF would have my vote if he put up his hand, there’s nothing wrong with being passionate about something, but sometimes your passion blinds you to what’s going on.
    As UM says “that way they can see with their own eyes what is really going on”, and lets’ face it getting one of our own onto the board we might get the right information about what is going on.

  27. "getting one of our own onto the board we might get the right information about what is going on"

    how would that person be allowed to divulge anything ?

  28. I'll cop the punishment for a minor typo.

    I watch price screens in numbers, not decimals.

    Reading 0.038 BID 0.040 OFFER I'll just refer to it as 38/40.

    But you can all have that one if you like haha.

  29. Pokerface

    3,612 posts.

    S39, just because someone has a passion for a stock and its story and has some shares in it, does not make them necessarily well suited to be on the Board. Relationships take a long time to develop. I think we have to put our faith in the MD especially who has established relationships with the guys/companies with the deep pockets. He put his money where his mouth is and took up some stock in the SPP. I think that is a sign. I know it is not a huge amount of money, but it is the principle involved.

    Wouldn't it be a great irony if a deal for seriously progressing this project were announced and this thing shot like an arrow to 50c. All the naysayers would be hard to find on this forum. You never know your luck, S39...it might just happen.

  30. PF

    yes that would make everyone happy, myself included.

    However the proof is in the pudding and I feel the MD has about a 10 to 20% chance of doing that.

    time will tell.

  31. jadsdes

    226 posts.

    S39 "...As UM says “that way they can see with their own eyes what is really going on”, and lets’ face it getting one of our own onto the board we might get the right information about what is going on"

    Who are you refering to as "one of our own..." and are you saying that "....right information about what is going on" meaning to be that TNG information is not correct.

  32. Well, IMO the main problem this year for TNG was a change in the strategy of our Chinese partners. BTW the Chinese directors did not participate in the CR. The main reason for the low SP is the fact that the Chinese did not participate in the first CR at 7 Cent. The question for me is which intentions and expectations they have for the future of Mt.Peake and TNG.

  33. bobadah

    2,065 posts.

    I have a fear (hope I am wrong) that it is in the Chinese interests for TNG to fold and allow them to get it very cheaply. They could actually finance the deal and make quite a reasonable profit, but only about one third as much as if they get full ownership.

    Another question - why do we have a Chairman that does NOT support the company.

  34. jadsdes

    226 posts.

    Prospektor. I think possibly a change in strategy may be a reason for the Chinese behaviour. However, I tend to think that the Chinese leadership issues and the 'freeze on investments' by the Chinese Govt during the period of leadership change flowing onto SOE's may be the reason for the apparent change in stategy but is not therefore a strategy rather a reaction. IMO suggest that TNG is not the only company that has been caught by the Chinese leadership issue and the lack of involvement in CR's.

    I read an article on this recently in the Australian and the suggestion was that the chinese leadership issue would be more settled in 3 -6 mths. That is China leadership has changed and that has a flow on into SOE's and takes time to sort itself out. ie: ongoing investments outside of China held up.

    On this assumption the TNG board and therefore the MD would seem to have done a pretty good job raising captial.

  35. Pokerface

    3,612 posts.

    Listen to Prospector!

  36. "the Chinese did not participate in the first CR at 7 Cent"

    well, the question is why not ?

    Unfortunately we don't have inside info and speculating is a waste of time.

    The Chinese have only the positions of Chairman and one Non-exec. Director.
    They are not running the show.
    what do you think how happy they are reporting the state of affairs back to China ?

    Looks to me like they are sort of trapped.

  37. igilug

    1,533 posts.

    KBJ,
    Isn't your conclusion a speculation?

  38. igilug
    yes , it is.

    what's your conclusion from the questions I have put?

  39. igilug

    1,533 posts.

    Look, your quite reasonable and with experience, I can not match that.
    Sometimes speculative arguments are ok, provided a valuable premise stands. The Chinese did not participate for the CR at 0.07 and frankly I don't have a clue KBJ, certainly, a reason has to exist. They spent 13 million for the sole purpose of getting a stake into mount peak, do you think they objected when the money was directed at or other works beside the mount peak? Have they lost interest? 13 million is a lot of dough and that kind of dough would not be spent without cause of matter. We are in the process of getting this project of the ground, many ticks have been added and the Chinese, out of principal, will see their money chucked away just like that? Doubt that very much, but they probably are not pleased since CR 's have been made. Reason says that the situation is not that bad and a solution for finance of the project is at hand. Why I speculate this is because the Chinese are not going to lose that money, this chunk of Vanadium is an asset to big for them to lose upon, their strategies are always in front of others and their tactics are ruled and governed by sound principals they always look ahead. The SP is scary, though only to shareholders that would have loved a higher and decent SP and the fall is speculative, I can see that miles ahead. this SP is irrelevant at the moment if the financing of this project is going to be processed otherwise intervention would have rolled in.
    There is not much else I can speculate upon as all the others have mentioned their thoughts and rightly their concerns.

  40. thank you for your open minded considered reply

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