$ does have an effect. Of course with a better rate against the £, our dividend payout (if we're getting another one) will be higher. This about it with the £ though. The earnings remains in $, so that would not be affected, unfortunately. The biggest gain for Centamin is cost because some of this actually occurs in Egyptian Pounds (such as labour) which is now lower due to the $ increase. While I'm talking about that, It would also be interesting to know how the reduction of oil price has affected cost here, but I do not, as of yet have an indication on this. Of a lesser factor, is depreciation costs. This is slightly more complicated to determine, because the cost on expenses this year will be in $ - but its not a real cost for this year as the cash has been spent when the assets were bought. However, Centamin recuperate the expenses from the government and that would be in $, (when some if not most of the local expenses could have been done in Egyptian Pounds). It would be difficult to assess this, but in the end the gain-factor is reduced because our earnings will ultimately be in $ anyway. that's why I say its a lesser factor.
RE: Siko & Mac - Thanks
Sinner am I right in thinking a strong US$ is better for us as it will take less to exchange into a GBP£. e.g. last summer it was 1.66, now its 1.52, so nearly a "hidden" 9-10% gain? or is that too simplistic a view?
Howsey, yes most stocks have risks, but that's exactly it - if this share had literally ZERO risk, it would be a lot more expensive than it currently is. In fact it would likely be overvalued by the market just like any rare asset is. However different people like to buy different risks. Some people would buy assets whose management has ran it down, but they may understand why more than others and believe of some sort of rescue. I, personally don't like those risks and stay away from bad (desperate) management. This share has had recent risks such as gold price, two court-cases and the country's stability etc. The market has weighed this up and it was undervalued at less than 30p at one point. I 'understand' these risks which Centamin faces plus I believe there are also more opportunities which Centamin will eventually take account of, in growth. Now two of those three main risks (the country's stability and the courtcase) has had progress, it might not feel like it, but in the details we are in a better position than we were a year ago, on both counts. The third risk (gold) does not cause Centamin as much trouble due to the low costs but it is still a risk because there is still a chance it could go lower. Now as far as terrorists go, I don't know if you're referring to MB or ISIS or both? I don't personally know if MB is a terrorist organisation (I'm not saying they aren't or they are) but they were not a threat to Centamin when they were in power and now they are also weakened and very much under 'control' via new laws in the country and the army. If they somehow come back in power, which I doubt they will, Al-Fakharany and a lot of judges will probably be in jail. As far as ISIS are concerned, I understand there has been incidents in Libya and there are increasing openness in people declaring support for ISIS over there. However, for now, the threat to Egypt remains very limited as it looks like, if there were fighting, it would be more against Egypt as opposed to infiltration and support from within. Also, I've heard of islamists in Egypt have declared opposition to ISIS. Of course, this should remain monitored as things change all the time.
On a side note.
What has happened to Hkinvestor21? I hope you lads haven't swamped the board & he can't get a word in edge ways? Lol.
Nice of you to point out what a high risk share this is! I'm just glad you didn't mention those pesky terrorists !!!
Siko & Mac - Thanks
Interesting responses from both of you. 10k likes on Al-Fakharany's FB, thought it would have been a lot more than that (then again perhaps that's only reflective from the newer generation only). So I suppose the next events will go a bit like that then: Feb: 1. Parliamentary Election SCC - Likely outcome is Unconstitutional. Mar: 1. Commissioners' report - Likely outcome, probably Unconstitutional 2. SCC Ruling - hopefully constitutional even if it is 'with-conditions'. Hopefully binding, which means that as soon as conditions are met, the law remains effective. 3. Investors' Conference 4. Annual Results - Likely outcome, productions as expected, revenue less than originally expected (last year) due to missing guidance and gold's price 5. Parliamentary Elections starts. April: May: 1. Parliamentary Elections concludes June: 1. Next .Hearing. I think we're going to remain busy here .. there's lots to come. I'm sure I've missed some more events up there. So perhaps we can add to it, copy and paste in new post ..
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