Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Doesn't matter how many reserves or what potential you have, if you run out of cash then you're toast! I think ATM bought the rights to Uis for some paltry sum from some toasted seller from back when tin was much lower.... and I just feel risk adverse about a 12% loan.
On a brighter Tin rebounded to $27k today after a scary drop to $24k yesterday.
The share price was at 5.3p when the AISC was at $33k, lithium and tantalum were but a wet dream, and no financing had been agreed. Think we are all agreed that the current price is too low.
Hopefully we'll see a rebound tomorrow.
Okay. Let's put this into perspective we are mining Tin already and are sat on some of the potential largest reserves of Lithium, Tantulum, which will at some point in the future also be moned for extraction.
Today, we stand at nearly half the market cap of Cornish Metals who are unlikely to be mining Tin for at least another three years.....let that sink in on what a gem we are sat on.
Agree with you fully Agricore. Hope you get a response to your letter/email - I have tried to contact them in the past via the website link but not had a reply.
Next six months should bring phase 1 expansion, productivity improvements, resource drilling results, and hopefully the Li pilot circuit - all of which I expect to be beneficial to revenues and sentiment, which is clearly pretty depressed at present.
I am in Illovo in August, might drop into the office..
Good point, but some choppy waters through out 2022, but I do think in time the tin prices will rebound.
We not vogue currently, as the newsflow will be throughout 2022 into 2023 and won't attract the instant brigade, but a lot too look forward to, if people prepared to wait.
I think you're all too optimistic thinking that the current climate would generate an offer of fair value. Today's tin price is a further drop of 5% to $24k . For now it's a case of batten down the hatches keep seeking to drive down production costs because reaching the AISC $20,500 could become increasingly critical.
I worry about the wisdom of further borrowing at high rates and have written to the company to express my concern. If their analysis is such that the pay back is worth it then fair enough but taking risks with precious cash, and wasting bandwidth on speculative takeover talks would be a massive mistake right now. In my opinion.
I am perfectly comfortable that things will rebound and there's a bright future ahead, but safety first.
I wouldn't like to say as it depends on what stage things are at etc. Though, I would hope a reasonable and realistic price and the pi's don't get shafted.
Though, this is a certain buy and hold share at these prices!
I have been seeing the buyout talk for some time now since we were at 2p. Just wondered what everyone thinks would be realistic offer?
Whatever happens. All i know is that this SP is going to be well North of where we are currently when that time comes. Good luck all.
I do think it will get bought out before Phase 2, buy that time the Lithium be on the board then and well publicised.
This is incredibly cheap at the moment!
Short term loan due to facilitate continuous improvement and lower AISC ... wasnt needed before , but due to falling tin prices needed now ... not an issue, when tin prices climb again loan will be repaid... Afritin will be bought out long before phase 2 .. buy on weakness to multibag in future .. no brainer
Afternoon all,was looking at the loan comments,going back to the PEA rns results a few weeks ago AV states once phase 2 is complete and the lithium on stream ,there will be a rapid payback of finance of just 1.5 years.The loan we are securing is set at 10 years,but doesn’t mean we have to take it to full term.I’m well pleased with how things are going at Afritin.Better to have a working loan facility,than doing a cash call diluting shares .just my opinion guys
Not sure i agree with you UJ. Call it what you like, but effectively it's a long term loan to bridge a shortfall in funds to complete the expansion stage of phase 1. ATM have dressed this up by calling it the 'continuous improvement project'..(where did that come from, first mention of it today..) - in reality they borrowed NAD90m in November last year to complete this and it wasn't enough. Another NAD100m for improvements..? Let's just call it what it is.
On the borrowing, the equivalent rate in USD would have been ~400bps lower, which over a 10 year term mounts up to almost $3m of EXTRA interest, so not chicken feed. And whilst there's no interest to pay in year one, it will accrue, and most likely be added to the facility, making it larger. Don't forget, this is a direct hit to profits, which as a shareholder, i'm quite keen to avoid.
The $ has been appreciating vs the NAD for at least two decades, and will most likely continue to do so. Our revenues are $ based, borrowing in the same currency, paying less interest and fx'ing into NAD at improving rates makes more sense to me. If the NAD starts to appreciate vs the $, then the facility does get more expensive - not likely in the long term but quite possible when US rates start to peak.. And this loan has no cap to how high Namibian interest rates may go, their prime rate could be >10% by next year.
Look, it may be that NAD borrowing was the only option available, although as we're going to need to borrow $400m to finance phase 2, i hope not! NAD 6bn at 12% interest really doesn't sound too attractive..
peking duck, this isn't a bridging loan, it is a 10 year facility. Additionally whilst reference to the interest rate being high on the face of it is correct, you have to remember that the inflation rate there is high. the margin at 2.5% over namibian base is not high AND there are no capital or interest payments for a year, i.e. until after all the expansion works have been done and cash flow has improved significantly. There was also comment by others that borrowing in dollars would have been cheaper, again one needs to bear in mind that if you borrow in dollars, you pay in dollars and with inflation and an adverse exchange rate that soon gets very expensive.
I think they have done the right thing, and in twelve months time the sp will be very considerably higher. This is not investment advice, just my own personal view. DYOR.
Not wild about a buyout yet....every one I have been involved in has ended with PIs being stuffed, whilst CEO, Directors and Board get large "golden handcuff" salaries for "advisory roles"...
Glen P has form here with MARL some years ago.
I agree with pekingduck the rates are high, then again I suppose banks do nothing for nothing!
Hopefully tin prices will creep up in the next 2 quarters, then things really will take shape.
It's good they secured the financing, good comms going forward to what to expect, the pieces fitting together to form the bigger picture.
Though a part of me wonders how long before someone buys us out!
This company is going to get snapped up!!!....Sooner rather than later,
just on the forecast of 350K tonnes of lithium concentrate annually.....
imo gla
AfriTin is managed by an experienced board of directors and management team with a
current strategy to ramp-up annual production at the Uis Tin Mine in Namibia to more
than 10,000 tonnes of tin concentrate and 350,000 tonnes of lithium concentrate
Interesting. Looks like a bridging facility to make sure the phase 1 expansion completes on time and to iron out some wrinkles that seem to have cropped up. Expensive terms, and why are they borrowing in NAD when the base rate there is so much higher than for USD..?
I guess the prospect of lower tin prices in the near term is impacting expected cash flows in coming quarters, as this project was meant to be covered by existing cash and free cash flow.
Glad to see they have arranged the finance to complete expansion on time and also further reduce costs and improve efficiencies. And better than the alternative, an equity raise at already deflated prices.
A pick up in the tin price would be great from here, perhaps that's what they're expecting. Going to need it with those interest rates..
It's always nice to see when you have the countries national bank in support of your business goals. They realise just how important the UIS mine is to their future.
Recently invested here - enjoying the good comms and steady progress towards clear goals