We spoke to new Sterling Energy CEO Tony Hawkins about the latest changes happening at the company. Watch the full 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 and have access to Premium Chat. 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.
Thanks for getting back to me. I agree with your point ref what is the alternative for dividends. If you take my most optimistic case below and say investors would be OK with 3%, which is still superb relative to banks or even most other companies, then you get a share price of 300p. I was, up until the past fortnight, confident we would see this beautiful number next year, now I would be grateful to claw our way back to 200p.
There is also the key question of confidence. Investor don't like surprises (well not the bad ones) so companies get punished through their SP for this. Now in CEY's case we have a new CEO at the helm so he will get some grace for that. There is also almost inevitably the usual going on here of a new CEO kitchen sinking it up front when we can blame it on his predecessor. Get all the skeletons out and then there is no danger of them coming out to get you later. Like you I would really like to see Horgan buying a very significant chunk at this price.
Hi Mr Bond,
No I don't expect CEY to make a loss but they will make less than they would have before. I expect that there will be a dividend but worry that even with the increased POG it will be less than the year just gone. Take next year with AISC at 1250 and say gold at 1900 that means profits will be 650 per ounce. Take the mid-point of forecast of 415k and we get $270M of revenue. That means c$135M left for shareholders after EMRA's share. There are 1.15bn shares in circulation so 11.7c per share. As CEY dividend policy is to pay out a minimum of 30% as dividend that would be 3.5c for the year. They can pay more and last year paid around 68% which would see 8c. Last year with the 68% they paid out 10c. It is therefore not impossible that they maintain the dividend at last year's level but that use nearly all free cash-flow. Hence my question.
I would also point out that the cable is currently at $1.3 to £1 so the 11.7c equates to 9p. With the pay out at 30% that would give 3p and at 68% that would give 6.1p. With the share at the current price of 133p we are therefore getting a yield of between 2.25% and 5.11% so not bad. I would also add that CEY has in the past paid out all the free cash flow as dividend so if they did that we could be seeing 9p per share so 6.77%. This of course is where you get the key question of what will they do with the money if they don't give it to shareholders. Theoretically they should only be using it for other purposes if it will give a higher return to us later. Unfortunately therein lies one of the key worries that all this investment in prospecting over the past years has little to show for it. If you want the positive case then if all free cash flow was paid out i.e 9p and a yield of 4.5% was considered acceptable and sustainable then you get a share price of 200p. If you want the negative case then set average POG a lot lower than at present, after all it was just over $1500 at the turn of the year and went below that back in March. At $1500 POG and AISC of $1250 we get 250 per ounce so with 415k used above we get $104M profit so $52M after EMRA share which is 4.5c per share. If the minimum, as per CEY dividend policy was paid out we would get just under 1.35c per share so just over 1p. If investor felt they needed a 5% yield for the level of risk then that would mean they would pay just 20p per share. Again I am not for a minute suggesting that is a reasonable share price, not least because I have ignored in all of the above CEY's significant cash in the bank.
Please be aware I have not double checked my calculations and am going by memory for some of the figures. This is therefore only for illustrating my thought process and should not be taken as accurate. I am also just trying to illustrate, having come up with a price per share of between 20p and 200p, the extent to which how you value CEY depends on what you assume.
Hope this helps.
Hi Elprof, as Mr Bond says the company will be making huge profits on gold. The last dividend was based on gold around 1600/1700. It really is a cash cow. Also I can only see gold going one way in current climate. Now look at the alternatives for dividends. Not much really. This is still a world class asset. But I would also hope and expect the management to start buying at this ridiculous price!!!!
Well at least you had the good grace to clear that up, as it was not at all apparent, from your original post.
My point of quoting Berenbergs analyst Laurent Kimmals $1500 and $1350 gold price prediction was two fold.
1 To show how wrong Berenberg were in Jan 2020
2 If Berenbergs gold price assumption is still $1500 or lower they just priced CEY at 142 !
Elprof, are you under the impression the company will make a loss this year, the divi will come out of a still substantial profits, and the cash pile will still increase .
Or something else?
What is giving you the confidence the dividend will be maintained? Is that based on gold price rise off setting production dealing or CEY using their cash pile?
The last person I would give data too is you, as you and your acquaintance's would simply twist the figures and facts to suit your agenda of demoralising holders , and pushing the shares lower for selfish means.
For you to say continuous De- Ramping cannot sink a share price is ridiculous and untrue , as has clearly been seen here in the last few days.
Dividend will be maintained and the price of gold is only going up. Just look at the financial ####storm brewing. We haven't seen the worst yet.
I am just telling you what management of Cey has already told you. My thinking and comments can not sink or bring higher company like Cey. They have already done it without me several times in last couple of years. If you believe that this price of shares is excellent and it will go only up from this point than buy it. You do not have to read reports from Cey, or comments and opinions here, but it would be very nice to share your
information and data why you believe in that. However if you have some insider information please shear with us.
I am waiting for an answer on my questions. Why the price of stock has fallen last year to 88GBx? Why company does not buy back shares on this price?
However conversation here should help us to find out if the company is in good shape and is the current price good enough to buy more shares. So any good data about that issue are more than welcome.
I wonder is Gep75 and his buddies are on Sawiris ,END ,payroll, to put the boot into Centamin in order to drive the price lower for another attempt at piracy.
Sawiris drooling over the thought of all that cash and juicy assets ,for a bargain price.
Thanks Siko, I got the same feeling at the last attempted T/O.
Naguib Sawiris does not seem to be popular with either the banking sector or mining sector, having been rejected by CEY, by Shaloween and an attempt with breaking into Banking, (Not quite literally breaking) ,but others may see him that way, lol.
Wow, Gep75, clone child of Sotolo.
You really are learning de-ramping quickly, almost a month since your creation, and getting quite expert.
I have checked the tweets you mention and I don’t see anything to worry about - just two Egyptian billionaires with big egos .
Sorry to interrupt your discussions, but I think this is very important and something I have not come across before...
I think Centamin might need your help..
Mr. Naguib Sawiris posted a tweet on Wednesday criticizing Centamin after the RNS..
To my surprise, Mr. Sami El-Raghy replied to the tweet a few hours ago , and Sawiris replied back..
The tweets are not nice at all, a bit personal from Sawiris and it's like a war between Centamin and Endeaouver..
The clever ones here could give Mr. El-Raghy a hand..
Just search (Naguib Sawiris) and see today's tweets and the one from 2 days ago...
Personally I was afraid that the problem with open pit is not as small as some people wanted to present. After this post result call I must say that there is a real problem, because they will need 3 years to reach maximum production and that is only prediction. Personally I do not believe in promises especially in this case that after 10 years of production and promising they couldn’t reach 500k per year. In worst case, and that is possible, it is questionable if they are going to dig even those 400k in next year, because it is obvious that they are not going to make open pit ready for full production. But this is just my opinion.
This data is actually scary:
Q4 production guidance of circa 60,000-70,000 oz, at an estimated cash cost of US$950-1,050/oz produced and AISC of US$1,450-1,650/oz sold, which includes capital spend of US$30-40 million.
Consequently, free cash flow expectations for Q4 are expected to be largely neutral
If they have problems also with underground water as someone said, than that is one more concern. So we can see that it is not so easy to dig a gold even if we all now that it is somewhere there.
My question is why the price of stock have fall last year to 88GBx? That is so strange as well as this situation now.
As I have sad before if there is no huge insider buying than the share is not chip enough. With 350 millions on the bank account it would be better that they are buying Cey stocks. Why they are not doing that?
Q4 production guidance of circa 60,000-70,000 oz, at an estimated cash cost of US$950-1,050/oz produced and AISC of US$1,450-1,650/oz sold, which includes capital spend of US$30-40 million (a total of US$120-130 million for the year)
·Consequently, free cash flow expectations for Q4 are expected to be largely neutral
The Endeavour offer for Centamin was an all share offer. It was something like 1 Centamin share = 0.08 Endeavour shares (approx., from memory).
Back in December / January that was equivalent to a "no premium" cash offer. Not so attractive.
If Endeavour made the same offer today it would be worth about 172p cash equivalent, a 30% premium or so. That would be much more attractive.
Compared to most other gold miners (not just Endeavour), Centamin has simply become a whole lot cheaper over the last few months. Given that Centamin still controls a world class resource, has first mover advantage in Egypt, and has no debts and a huge cash pile, it must be a tempting takeover target to its rivals.
So I'm not sure that Centamin can keep its independence for long. I'm not even sure that it should.
Auson ,what was your point of quoting Laurent Kimmals prediction of January 2020 ,of gold $1500 by the end of the year, and $1350 next year,
Were you hoping too panic more poor souls into selling ,so you can get in a lot cheaper, I think you and your acquaintances did enough damage yesterday. Give it rest.
Can someone enlighten me as I always thought that when the Dow goes down,gold generally goes up,this does not to be happening now,we seem to follow the Dow up and down together. Just curious,is it because of these unusual times at the moment.
Sotolo, Sorry but I do not believe you too be invested emotionally in anything.
That is not your style . You are too hard nosed, after all this is business , not just games.
Good night to you and all, have a good weekend, we will see what the future has in store very shortly.
Good to hear from you. Sorry to hear about your double whammy of getting wacked on HOCS as well as CEY. Why do you think it was unfairly pulled down post results? Keen to understand as I may want to invest there rather than CEY with some of the money currently sat on the guidelines.
I share your fear ref price of gold. Imaging where Cey SP would be with gold back at the $1500 level it was earlier in the year. Having said that I expect gold to stay strong and even climb given the extent to which the Government printing presses have been in overdrive across the world. Basic economics says that more money being printed, which is basically what QE is just a posh name for, means that each unit of money is worth less.
It is only a few weeks that I was expecting 250 this year and 300 next. When will I ever learn?
Hope you find a way through with the house.
Totally agree Prof, and also would really appreciate the views of mining knowledgable among us, like Dasut etc, but you seem broadly, and somewhat scarily, right as ever like Tiger who mostly sold out around 220 and other friends. Prof, as you know the worries we share about Cey and POG are not willing the share down but, for both of us heavily invested here financially and emotionally, we want reasons why POG and Cey should rise. Given the limited ounces of next years and so higher costs we just hope rising gold will save the day but feels to me we are in a narrow range from which gold could equally turn up or down. Fingers crossed and willing it up as much as I can! About to sign with builder so worrying as not keen to cash Cey in now but... Not a good week as my sale of 20% at 137 ish and move of half of it to Hoc misjudged as Hoc has fallen since its results too, I think unfairly. And my Fres. Only OMI rosy as got sale of them right and gone in on fewer lower. You can always tell when things are bad as I start trading a bit trying to find a way out. I think you were probably wise not to reinvest in Cey today, I too am sitting on the half cash from my sale and was tempted back but not yet, first time I have sat on any cash in years. Have a great weekend lol and let us hope next week is better and that when gold breaks it is up not down, and thanks all for your collective wisdom!
They did indeed fail which would suggest an offer would have to be be higher. Conversely that was based on gold production forecast to be 510-525k for this year. We are now talking about 3 years before even getting to 500k.