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Teal Valley T.TV


Primary Symbol: P.TEAL

Teal is a Canadian, pharmaceutical & NHP manufacturer selling to Canada’s national, chain drug stores, presently expanding its portfolio to include cannabinoid-based products utilizing proprietary formulations & extractions for both the global Rx & recreational markets.


P.TEAL - Post by User

Comment by kramaswamyon Feb 28, 2022 11:42am
139 Views
Post# 34467888

RE:RE:Perkoa 2022 production and TV profits

RE:RE:Perkoa 2022 production and TV profitsAnd this is the crux of it. Yes, if "everything" goes right, then Trevali will be swimming in money and we'll all be rich.

But that's a big "if", and one which I see no reason to assume will be true. Has Trevali demonstrated, at any point in the previous seven years, that they are trustworthy and reliable? They have not.

Look at the flipside - if Perkoa and Caribou are essentially mined dry by the end of 2022, what happens in 2023? Suppose they do nothing this year except mine and pay down debt. At the end of 2022, they'll have one active mine and no debt. If zinc spot remains at a point where Rosh Pina is profitable, then in 2023 they'll start accumulating cash.

This is all great, except that a mining company can't just rest on their laurels. Rosh Pina will eventually be mined dry as well, and they need to start looking for new mines. And therein lies the problem.

To finance a new mine, they'll either have to take on debt or use equity. At the moment equity is basically worthless - Trevali's market cap is $120M, so to raise the $200M they expect to need for RP2.0, they'd need to dilute by over 50%. And if they finance with debt, they'll be looking at having to repay a $200M loan from one mine. It might work, but if spot prices drop at that point, they're essentially bankrupt.
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