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Good points Dasut I can't understand why Pardey did such a turnaround and decided to give a 3 year forecast, seems rather foolish especially when considering all the unexpected problems that have hit production since 2018, although to be fair they were aware of the grade problems in 2015, but I understand they were able to hide them by high grading.
He appears to have been be well out of his depth in his present role and should have been moved on before now, his continued failure to deliver on his promises have really damaged Centamins creditability with the markets
I am sick and tired of hearing the same old excuses of why they can't deliver on guidance, these guys are employed as experts in their field to solve problems and deliver!
Alexandra Carse IR stated in 2018 that the production crews were ahead of schedule in getting through the transitional grades and that the higher grades they were soon to hit were looking to be better than expected ,so what happened?
Pardey seems to have been giving share holders plenty of baloney but not as much gold as he promised!
Rebess yes I agree forecasting is extremely important for internal financial planning and such forecasts have to be realistic and achievable. No business owner wants to hear promises from their senior managers because that is what they believe he/she wants to hear.
This is where we are with Centamin and we as any business owner wants is factual forecasts not what would appear to be guess work.
Bob Dudley @BP_plc
Dave Lewis @Tesco
Martin Gilbert @SLA_plc
Alison Cooper @ImperialBrands
Vernon Hill @MetroBank
Forecasting is a central part of financial planning. In mining, production forecasting is an essential guide going forward and perhaps the most important indicator for would be investors and why professional people, skilled in the knowledge of such matters, are employed. You can't just say, when it suits, that we weren't expecting this or we weren't expecting that, markets won't accept that. - Even companies just issuing profit metrics as a way of reporting, usually offer earnings-growth as a guide/forecast to would be investors.
goldgnome yes I totally agree just trying to keep the post as straight forward as possible. Could also go into selective mining, waste to ROM, compacted leach pads that don't leach, ROM to waste, cyanide leaching into potable water supply. The list goes on and on without venturing into plant in an area that is later designated as part of the ore body.
As I say the list goes on and on as to why it is extremely difficult to predict annual production and to be quite honest I don't understand why the mines do it why not do what most businesses do and report profit and loss in money terms.
I don't see Heinz saying backed beans down but salad cream up at the end of every qtr etc OK maybe not a good example but trust you get my point.
Not a bad description. But it is a lot worse than that. So they are mining something they cannot see, and they are using drill holes, lets say 80 mm diameter, to try in the first instance estimate the reserve or resource, sampling something which has an uneven distribution (generally) ... good luck
Prof as I say I would love 560k to be achievable but problem is straight lining doesn't work because the gold ore is not consistent.
When I first got into mining I had difficulty getting my head around so many grams per tonne and when you see 0.75 g per tonne you can see how difficult it is to make predictions on production. Now multiply by 5 or 6 because of waste you can see again how much material needs to be moved to get to that 0.75 g.
Also my first visit to a mine and looking at excavators digging a face and loading a truck thinking it was waste material when in fact it was free dig (no need to blast) ore, it was as it looked no different to a road project I had visited earlier in the day where they were cutting through the bush to build a new road to access another mine.
The ore was actually close to 2 g per t and no way visible to the naked eye so respect to the geologists. Now to really confuse on exactly the same level as the ore being mined there was another excavator loading trucks with waste and geologists explaining to the pit boss where to dig.
OK since those days mapping has improved and machines/excavators/loaders have also improved with software systems incorporated so the machine operators can see when they are digging ore or waste. However input is crucial and needs updating regularly inline with drilling results.
So hopefully this helps explain how straight lining and making forecasts for production is difficult and we are seeing how difficult the ore body is to predict at Sukari.
Interestingly when I saw my first detailed presentation made by Sami it was at an Australia meets Africa Conference at an hotel in Perth Australia in 2000 and we were all impressed by the 3D software that was being used to explain the early days of the ore body, so they were using modern technology.
OK the above relates to open pit mining which differs from underground where once exposed the ore body maybe known as "seams" can be followed and more reliable forecasts but according to recent reports the open pit is primarily the source of ounces.
The tune/song that I am reminded of: - 'Why, why, why, Delilah!
The mystery for me is why have they chosen to communicate sensitive information regarding production using 'Hints'. - They've kept to the new arrangement of 'Quarterly reporting' all year until now. Suddenly, that philosophy is scrapped, resulting in the devastating effect we have seen unfold, with more to come. Moreover, they would be aware that this would happen. - So what's going on? - Why have they done this? - They didn't have to. - They could have waited for Q3 reporting day and whilst the bad news would have had it's affect, at least it would be only the one-hit instead of the three and the resultant pummeling we are having to take. - Why? - Why? - Why? - There must be a reason.
I think the board gave a firm indication to the departing CEO that his result/s have not been acceptable. To see him "retire", is a very good sign of a properly functioing board. I do not think he was up to the job(One could ask why he was chosen but I think Josef has answered that, but Josef, being there for 12 years does not make him a good manager of an expanded mining operation). But a company must perform, and they must recruit a top line Manager/CEO. If they do this, this could be the tipping point. If Pardy would have stayed it would have been a bad look, in my opinion.
I was listening to Bright Eyes having just posted the link and this one followed on.
Worth listening to if you want to put our problems from yesterday's announcement into context.
Best wishes to all,
Those of you who know the song will be able to piece this together. For those of you who don't it is worth listening to anyway:
For some reason I have got a line from this tune in my head this morning :
'How can a light that burnt so brightly, suddenly burn so pale'
but with the word 'share' replacing the word 'light'.
Wonder why that is?
The 560 number for next year was based on 140 in Q4 and therefore a full year of 471-472 not actually meeting the 490 which like you I think is now out of reach. I was then extrapolating the 140 through 2020 to get the 560. I would guess however that if they have got some higher grades they can go after they might prioritise that in Q4 to try and salvage as much of full year production as possible. That could see a good Q4 that would not then be sustainable into the following year as we have previously seen.
The battered shareholder in me agrees that if they could just get 500k over the line next year with no nasty surprises that would be good. The optimist in me says surely more is possible and one day soon they have got to start delivering without the endless disappointment. As was pointed out by someone yesterday, a few months ago they were taking about 490-520 for this year with a number of factors that could generate upside. Was that a pipe dream or is it all still there and just delayed?
Very best wishes,
I take great comfort from the fact that you are holding yours. You have read the movements far better than me of late. My view is aligned with yours that this will recover however I have taken some money off the table because of the softness I expect in the share price in the short term. I agree that the high gold price will off-set much/all of the fall in production and so there is unlikely to be a profit warning. However logic would say that the market knew this and the new news is the reduced production therefore a lower profit than was priced in. Then again when has the market behaved logically?
Am wryly amused that you are so positive when a year or so ago, when you were quite rightly being cautious ,you had to deal with the accusations of being a de-ramper and a shorter. When will people get that different opinions are good and that a few posts on a bulletin board are not going to move a SP in any case?
Very best wishes,
HI Mr Tibbs!
My take is that there will never be a better moment than now to launch a takeover bid. The share price is down even though the gold price is up, the CEO is leaving (presumably after encouragement from unhappy major shareholders), the Chairman has sold his shares and is due to leave as well, and investor relations in general are a horrible mess (e.g. what HAS happened to Burkino Faso?)
So , IMO, it's now or never. If a takeover hasn't happened by Christmas, I'll assume that either the court case or the complexities of the production sharing agreement mean that one will never happen. And I'll shut up about it for good.
But for the next few weeks I'll be wondering...
European markets opened higher on Friday, recovering some losses from a day earlier when markets finished in the red following news that the United States plans to impose $7.5 billion in tariffs on products from the European Union. Meanwhile, sentiment around United Kingdom Prime Minister Boris Johnson's new Irish border proposal was mixed as Irish Foreign Minister Simon Coveney and European Council President Donald Tusk seemed unconvinced in the value to the arrangement, but gave Johnson another week to come up with a better offer.
The DAX was 0.58% in the green at 7:45 am CET and the FTSE 100 jumped 0.71% at 7:46 am CET. France's CAC 40 increased by 0.43% at 7:49 am CET.
The euro was flat against the dollar as it was 0,04% in the green, going for 1.09688 at 7:48 am CET. The pound rose 0.06% compared to the greenback and changed hands at 1.23412 at 7:49 am CET.
Breaking the News / VP
Gold back over USD1500oz and US job numbers very poor. Most now suspect a Fed cut very soon which will push Gold/Silver up towards Usd1600oz. True also that sometimes the CEO's retire or step aside for some action they do not agree with such as a takeover. I presume he has still kept his share options!!!? Time will tell but I am sure this is a blip in price.
Buy out/ tale over?
I have to agree that even if the court case is ever settled then it would be very difficult, if not impossible for any of the major mining companies to come in and work with the other partner EMRA whom I assume would have to be willing to go along with any new partnership arrangement.
If any major were even willing to try a take over it would be sure to be challenged in the Egyptian courts and what a case that could turn out to be!
Ref, Trucks & plant maintenance.
It is difficult to be on top form ,with plant running 24/7.
One seemingly small problem can lose a day.
eg. Conveyor belt to the feed.
I was involved with deep mines.
Changing the lift cables after inspection was a day of lost production.
That time is lost forever.
It only takes one seemingly small fault,for this.
Most will not understand.
But mining is unpredictable, the market is unforgiving.
As I have said before, the final years profit, is most important.
The driver of business, not like companies like Tesla.
G L A.
Hi Rebess, you're raising some excellent points. What's management' s motivation?
We'll, insiders own less than 1% of shares, si their interests are not really aligned with shareholders. Sure, the have some options but there could be other reasons as well. These guys in the City all drink their martinis together. I won't be surprised if one of the fund managers who is mates with a CEY boss said "I want to buy CEY, can you give me a lower price?!"
Last reason I could think of is that they perhaps have a buyout bonus like folks in Canada. So if someone wants to buy CEY then they will be getting a large bonus
Is it strange that this happens again same time year is it bad management or is it sus pect that the amount of gold in the third quarter drops again or poss that the ore is the same but mmm yea we’re did it go hey and now we can buy cheap share whoop whoop gold price is going up and shares are cheap I don’t know but seems a very large coincidence to me
Tibbs sorry hit the post before commenting on your observations relating to Pardey. I have never met him and can't therefore comment too much but from listening to his presentations and answers to questions I didn't have a great deal of confidence in his CEO responsibilities to shareholders.
Josef is however a good judge of people and Pardey has worked with him for quite a time but there is such a thing as over promotion and maybe this is the case. Being a hands on guy and involved at the face maybe is where some mining engineers blossom. Making presentations and appearing in front of large groups isn't easy.
Josef isn't a miner BUT he is an excellent face of the company.
I also think it isn't helped by retirement of the likes of Trevor Schultz who I am sure was a steadying influence with so much experience and someone who I hold in high regard having met him when he was with Ashanti Goldfields.
Was the UT trade at 16:35.
The after hours auction that clears the SETS order book and gives the official closing price
PLEASE play this London Stock Exchange 4 minute video that explains this in detail
Tibbs I would like to think that an increase in numbers of any production tools will provide an ability to increase production BUT it is all about efficiencies and fleet match as no good having loading tools if you don't have enough trucks and works the other way etc.
Again will be interesting to see the financials and the supporting production numbers and comments because they are still obviously having production issues.
Just got in from work. Wasn't ignoring you but believe another poster has kindly posted the figures now.
Time for food!!!