Electra Battery Materials Corp V.ELBM

FCC Working Capital

[Capitalista]

Around 15:30 in the Crux Investor interviiew (FCC website), Trent Mell mentions FCC will need a working capital pool of about $50 million to undertake production.  This is on top of current raised capital and they are working on putting it in place at the moment.  While this will likely be a line of credit, there are other ways of doing it.  Any opinions or intel?

[dothemathpeople]

Sure;  FCC is now over 650,000,000 shares I&O on a FD basis.  You just mentioned they will probably need another $50,000,000 in WC, potentially as a LOC (even as an equity raise, it would be stifling).  So that would be 650M shares, and close to $50-$60M in debt drawn down, with the possibility of another $30M - $40M in debt taken on.  The possible "conversion"

[WernerD]

This is nonsense and lacks any substance. Don't you read any FCC publications, financial reports etc. and suck all this junk up your sleeve? Have you not understood that the refinery commissioning has now been financed and that no further equity capital measures are required for this? If this happens, it is for other reasons. Where do you get the information from that equity measures will

[WernerD]

I would like to add that in a serious discussion it is customary to name the source (s). Since 2020 I have been listening to statements that are partly devoid of substance. A highlight was surely September 2020, when Elon the mask said "that Tesla is already very far ahead in the development of batteries that do without cobalt. And that will certainly be the end of 2021 or the beginning of

[dothemathpeople]

I was replying to capitalista.  The refinery is financed with debt, and equity at $0.25, no.  The remaining hard dollars (which will be minimal) will go to overhead, and Idaho, and any other non CDN asset development.  The equity comment was from capitalistas post, take it out of your calculations then ;). Feel better?  Close to 100% of the money, both equity raised and debt

[Silverad0]

Ok, $50 million for working capital.  Really?  B.S.!  Maybe you are off by a factor of 10.  Even then that would be a lot and an amount that could, should, possibly would be part and parcel of normal banking facilities. I do think we will see $0.25 before the SP starts to climb.  This one is hard on the nerves. As for the cobalt content, it changes every day.  Every

[Capitalista]

[Silverad0]

Capitalists, I beg your pardon.  I listened to the interview and yes indeed Trent did say $50 million in operating capital would have to be raised.  So we are looking at another 150 million share dilution.  At best we might have a billion dollar company with a billion shares outstanding two years out.  Painful to say the least!

[dothemathpeople]

You might well have that billion shares out soon, but this will never be a billion dollar company; ever.  Someone please news flash Werner that he might want to open his ears, before he loses his mind.

[WernerD]

Yes, if FCC never produces a kilogram of cobalt sulfate, you are right. Then they have to "somehow" finance the running costs. The commercial job of a company, such as a refinery, is to manufacture a product. So far is everything understandable? Therefore, one tries to generate the operating resources through a positive cash flow. It would be nice if there was some money left. Something

[stockdoc73]

Everyone needs to take a deep breath, again. Anyone should know that there are substantial capital requirements involved in manufacturing operations. Of course FCC will need working capital. When the refinery comes online they will need capital for raw material acquisition, labor, operating overhead, ect. and there will be a signifcant time between material conversion and receipt of accounts

[Goldfather]

Thanks Doc  ! .... good advice and insight. Would be nice to get a time-line on when the- REFINERY CONSTRUCTION START DATE IS ............  hello, hello,  FC ? 

[Capitalista]

Thanks, Silverad0. I listened three times myself to that part of the interview to ensure that it wasn't $15 million he was saying, but I kept hearing $50 million.   As Stockdoc73 points out, it will likely not be an equity raise to provide the working capital fund - these are normally LOCs with financial institutions.  I'm hoping, though, that it can be collateralized (at

[Pinoche]

operating lines are not secured generally, with the real assets of the company . They are secured by general security agreement and rely primarily on things like receivables and cash and inventory. Generally real estate only gets involved if they are pushing the comfort zone of the bank. In this case there is likely to be significant foreign receivables which probably puts them into a position

[Capitalista]

Thanks, Pinoche.  I had forgotten about the EDC and their programs - they are a definite possibility (if a bit expensive).  FCC may be able to avoid that route in the long term as they will be adding value to the raw materials rather quickly.  As they build cash (notwithstanding the debenture programme requirements) they will have less need for a bank-sourced LOC; however, they may

[dothemathpeople]

"Building cash" is easier said than done, ALOT has to happen, and happen positively...whats the deficit for FCC, cumulative, to date? When do you think they will have ANY cash flow? How far into their debt facilities would they be, at that point? "Choosing" is a luxury word FCC cannot rely on at this point, it seemed VERY difficult to secure that debt facility from Cantor

[dothemathpeople]

As FCC really has no actual "real assets" that would count.  FCC has no receivables, and no inventory.  No one would loan on their mining properties, as they sold all the valuable ones, after writing them down to zero, so.  Cantor Fitz loaned them the money.  Another seemingly inside deal.  Once they disclose just how much cash they are burning throught trying to

[stockdoc73]

The real asset that will count is a commissioned refinery to use as collateral. Obviously inventory and receivables at startup are non-existent so cannot be used. Plant and equipment is the way that most manufacturing working capital lines of credit are collateralized because that is where most of the companies value lies. From your post it sounds like you have done the math. Can you share with us

[ARIMA11]

Right. Ultimately value will come from vertical integration of mining, refining and hopefully recycling. The refininery was the quickest path to cash generation after all. Leverage it for exploration and innovation is the goal. The last part is what they really need to get going on. If they are able to show that they can re-coup critical minerals AND refine them... Cantor loaned 37 millions

[dothemathpeople]

I see; once they finish building it, and it works, and they are operational for some time.  So thats how long from now, and at what CAPEX?  Uh huh.  Do the math, in order of operation, Doc.

[stockdoc73]

Math, glad to have enlightened you on the process. You indicated that you knew that there was excessive cash burn and I asked what that number was. If you know the number then we can extrapolate what the ultimate CAPEX might look like. Short of that, I will trust the numbers that management provides as I have no reason not to believe them. FYI, once the refinery is commissioned the bulk of

[dothemathpeople]

You said nothing.  Nor did you disprove anything, just self service really.  My point, since you glazed over it, was that ALOT of money, time, and effort, is required, before they have any asset, worth anything.  Typical of you, and other like you, to miss that boat cause it doesn;t serve your narrative.  theres plenty of that going on in here.  I said nothing of what you

[stockdoc73]

Silly me. When you stated, " Once they disclose just how much cash they are burning throught trying to get this refinery lit, lenders will have less confidence.  It's a money pit, period." I simply aksed you for a number. Perhaps my command of the English language needs to improve, but when a company estimates what their cash burn will be to reach their goal and a statement

[WernerD]

dothemathblablabla won't give you an answer, simply because he doesn't have it. What kind of cash burning is the guy talking about ? Here, at fcc, funds are used to put the refinery into operation. Where is there a cash burning at the moment ? I'm so sick of reading things like that. 2020 all the b.s. with "we don't need cobalt anymore"; now this talking about scenarios

[NatureBoy]

Sorry WernerD, but are you really such a simpleton? Your question with regard to Math's postings seems beyond the pale. Seriously, you present yourself as an informed investor here and yet don't understand the concept of "burn rate?" You ask, "What kind of cash burning is the guy talking about? Here at FCC, funds are used to put the refinery into operation." Duh

[WernerD]

I didn't ask what a cash burn rate means in general. But thanks for the clarification. I asked where the affected person sees a high cash burn rate at the FCC now or in the future. If so, I would be very grateful for his presentation. If possible, with reference to the source. Because, as he wrote on September 22nd, he apparently assumed a very high cash burning rate. Or how is his statement

[dothemathpeople]

BOTH;  Burned plenty of cash before; about to burn even more now.  Not to mention what they wrote off on value.  

[TennisStar]

Still the dumbest troll here dothemath. Keep spewing

[Goldfather]

The (long waited) Refinery is to open for business 12 months from now.  FC closed on the $45 M loan 25 days ago. To FC management : when is the refinery construction to start ? We deserve an answer . Thank you. 

[Goldfather]

I've had 134 reads on my post asking of refinery construction start. Obviously no one knows a thing. Typical FC !  Transparent my backside !  Opening day Q4.... ya sure ?!  Do we have to wait for Refinery Opening Day Q4 (aka 12/31/22) , as last day in Q4.... but with a retraction 1 week prior by TM saying it'll be a little longer w/ another mea culpa ..... waiting for sp to

[BelieverCo27]

Thank you for stating this shared opinion so well Nature Boy.

[dothemathpeople]

Neither of you knuckelheads are looking at the financials.  the financials that report on what has ALREADY occurred you putz.  Look at the "deficit".  Thats how much money they have burned to date.  They are about to burn twice that much, or do you disagree?  The Cobalt camp ALONE burned over $36,000,000.  Or do you disagree with that too? You and your half

[Budcomags4]

Mining operations cost money to develop.  Are you saying that the burning through money was not spent on legitimate expenditures?  

[WernerD]

Capitalista and Silverado Amigos: It is not enough to hear. You have to think too. And if you don't even have the business basics on it, then you finally sneak up on zeros.