17 Sept 2020debt financing● Neutral
Skye Capital, KPMG's Global Mining Team and Gleneagle Securities are named as sub-advisers to the refinance. Investor roadshows start the following week, when key terms are to be disclosed.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
11 Sept 2020debt financing▲ GoodMajor
TerraCom starts a debt refinance targeted to complete by 30 November 2020, led by adviser Christian Baylis. OCP Asia has indicated up to A$80m towards it. This addresses the Euroclear bond due June 2021 flagged in the going-concern warning (inference).
7 Sept 2020director officer appointment● Neutral
Shane Kyriakou, a lawyer and former Ashurst Global Head of Power, joins as non-executive director. He fills a board seat after the June-August departures; the text does not say he is the Bonython nominee Klepec's replacement.
3 Sept 2020production update▲ Good
Sales to end August 2020 were 1.636Mt managed, an annualised 9.81Mt, with Blair Athol at 389kt (2.33Mt annualised). The CEO says the company is well positioned to exceed FY20's 9.98Mt, helped by Eskom domestic contracts.
1 Sept 2020annual report▼ Bad
Results summary: underlying EBITDA A$79.6m, net loss after tax A$146.1m, record sales 9.98Mt (up 11%) and ROM production 14.55Mt. Statutory EBITDA was A$4.5m versus A$96.9m in FY19; a A$115.2m Mongolia disposal loss is adjusted out of the underlying profit.
1 Sept 2020investor presentation● Neutral
FY20 results presentation repeats the figures already released: record 9.98Mt sales, A$79.6m underlying EBITDA, Universal acquired, Mongolia sold. Market cap A$97.0m at 28 Aug 2020; debt US$163.6m, cash US$41.6m, net debt US$122.0m.
1 Sept 2020annual report▼ BadMajor
Preliminary FY20 results: revenue A$351.6m including discontinued operations, and a loss attributable to owners of A$141.3m versus A$11.2m a year earlier. Audit is not finished; an emphasis of matter on going-concern risk is expected over refinancing of the Euroclear bond due 30 June 2021.
25 Aug 2020asset acquisition disposition▲ Good
TerraCom buys the mobile mining fleet at Blair Athol for A$3.2m, completing the switch to owner-operator at the end of July. With the dragline and coal plant, it says it can deliver 2Mt of sales in FY21 and beyond.
24 Aug 2020director officer appointment● Neutral
Non-executive director Craig Wallace, a director since 2013 and audit and remuneration committee member, resigns. No reason is given; this is the latest of several board departures since June.
3 Aug 2020director officer appointment● Neutral
Non-executive director Paul Anderson resigns at the request of substantial shareholder Bonython, whose nominee he was. Bonython has nominated John Klepec as replacement, subject to board processes.
31 July 2020investor presentation● Neutral
Presentation repositions TerraCom as an Australia and South Africa thermal coal miner, listing market cap A$105.5m, 753.6m shares, US$162.8m debt and US$36.9m cash. Growth options named are the Eloff coal project in South Africa and Guinea bauxite.
14 July 2020other● Neutral
Distribution schedule as at 10 July 2020 shows 753,607,630 shares held by 3,366 holders. This is the first share count after the Universal share issue; the 288 largest holders hold 94.98%.
14 July 2020director officer appointment● Neutral
Craig Lyons, a South Africa-based investment banker with 27 years' experience, joins as non-executive director to help the board with the newly acquired South African operations.
13 July 2020director officer appointment● Neutral
Non-executive director Jim Soorley, a director since 2017 and a member of the audit and remuneration committees, resigns. No reason is given.
13 July 2020other● Neutral
Top 20 shareholder list as at 10 July 2020, a required disclosure. The top 20 hold 76.82%; the largest is CS Third Nominees at 17.21%, followed by Bonython Coal No 1 at 10.46%.
1 July 2020business combination▲ GoodMajor
The UK squeeze-out of Universal Coal is complete, so TerraCom now owns all of it. Remaining holders get 10c cash plus 0.6026 new TerraCom shares per UNV share, and UNV is delisted from the ASX after close on 3 July.
25 June 2020director officer appointment● Neutral
Non-executive director Tsogt Togoo, on the board over 7 years and tied to Mongolian operations, resigns after the Mongolian assets were sold.
23 June 2020asset acquisition disposition● Neutral
TerraCom confirms transfer of all legal entities in the Mongolian sale to Bridge Resources is complete, finishing the exit announced on 12 June. No new terms are given.
12 June 2020asset acquisition disposition▲ GoodMajor
TerraCom completes the sale of both Mongolian mines, BNU and Enkhtunkh Orchon, to Bridge Resources for US$3, with Bridge taking on net liabilities up to US$28m. This resolves the Mongolia exit, with the second mine now included, unlike the earlier BNU-only term sheet.
1 June 2020other▲ Good
Hong Kong vehicle Rainbow Max, in which Ransley, Lewis, McCarthy, Boom and Etcell have interests, bought 67,359,578 TerraCom shares (about 9.42%) at an effective 17 cents each. Management says this shows support for the company.
18 May 2020business combination● Neutral
TerraCom will start UK compulsory acquisition of the remaining Universal shares, with statutory notices posted from 19 May beginning a six-week period. UNV quotation will be suspended five business days later and delisted at the end; sell-out rights remain open to 30 June.
5 May 2020production update▼ BadMajor
Blair Athol FY20 sales guidance is cut again to 2.5-2.6Mt, with about 2.0Mt targeted for FY21, as the mine plan is scaled back for COVID-19. Combined TerraCom and Universal FY20 guidance is 10.2-10.6Mt sales and A$86-90m EBITDA; squeeze-out notices due by 29 May.
4 May 2020asset acquisition disposition▲ GoodMajor
TerraCom signs a binding term sheet to sell its BNU coal mine in Mongolia to Singapore coal buyer Bridge Resources for US$2, with Bridge taking on a net US$15m of liabilities. Completion is targeted for 5 June 2020; it continues the planned Mongolia exit.
23 Apr 2020business combination▲ GoodMajor
With sell-out acceptances TerraCom now holds just over 92% of Universal's votes, enough to start UK compulsory acquisition of the rest. Squeeze-out notices will go out soon; the process takes at least six weeks and ASX quotation of Universal will be suspended.
7 Apr 2020production update▼ Bad
Blair Athol sold 630,000t in the March quarter (up 7%), with a 79,000t shipment delayed by weather; FY20 forecast is cut to 2.9Mt from the earlier 3Mt target. Mongolia's BNU sold only 48,000t as COVID-19 closed the China border.
6 Apr 2020director officer appointment● Neutral
Deputy Chairman Craig Ransley, TerraCom's founder, moves to an executive director role to oversee Universal's integration and overseas diversification, on S$450,000 a year with 12 months' notice. He is also now Universal's chairman.
3 Apr 2020regulatory community update● Neutral
The court removed six TerraCom directors from Justin Williams' coal-sample claim and ordered him to pay their costs, but allowed him to pursue TerraCom itself and CEO Danny McCarthy. TerraCom says an independent investigation found the allegations unfounded and will keep defending.
1 Apr 2020director officer appointment● NeutralMajor
Following TerraCom's 90%+ control, Universal's chair Mark Eames, Tony Weber and Henri Bonsma step down from the board on 3 April. TerraCom's Craig Ransley becomes chairman and Glen Lewis joins. Weber (CEO) and the CFO stay for an initial six months.
31 Mar 2020business combination● Neutral
TerraCom releases the explanatory letter and statutory notice telling remaining Universal holders how to exercise sell-out rights. It confirms Universal has formally withdrawn its legal action over Article 18.1, closing off that thread.
27 Mar 2020business combination▲ GoodMajor
TerraCom finishes with just over 90% of Universal's voting rights, up from about 87%. It will start the UK mandatory sell-out process (same terms: 10c cash plus 0.6026 TerraCom shares) and have Universal apply for ASX delisting within weeks.