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Hi Cowichan,
Very interesting and informative posts, especially so considering your knowledge as a geologist and indeed long term holder helps people to understand and come to realise that things are not a simple or straight forward as some forums would have them believe!
Tibbs
Hi MrGnome,
You had some questions you wanted put before Martin Horgan, I wonder if you would care to submit them to Alexandra Carse.
Head of Corporate Communications
E: investor@centaminplc.com
Please provide your full name, address and contact details,
You may have seen that Centamin intend on running some private investors webinars .with Q& A
Best
https://www.bbc.com/news/business-54230737.amp
Please read this link . This isn't my link. It is a BBC news article from September 2020
I will comment on it again when I get the chance.
Please read it with an open mind
One would think that if US markets go into sharp correction then this should be good for POG and CEY.
With the US markets looking at sharp correction, 80p is looking the likely place to aim for.
80p would be a dream - from that level, 100 percent upside possible!
Yep Cowichan, as I keep on trying to remind people too- sector unloved.
Hi Seible - having second thoughts is prudent while investing in any company. The only thing I can say is remember all the gold miners have been hit.
Barrick started the year $31.49 now $24.53
Yamana started the year at $7.79 now $5.23
IAMGOLD started the year at $5.02 now $2.75
Newmont started the year at $81.02 now $72.25
Agnico Eagle started the year at $96.21 now $69.95
There are a few exceptions (like Endeavour and Kirkland) but overall the gold miners are down significantly - however of those that do pay a dividend through these ups and downs Centamin pays the most - and in my opinion offers some compelling opportunities for growth - as stated in my last post about West Africa & Egypt - Cheers
An excellent post Goldgnome - seems you always have something relevant and informed to share. Thank you - I know it's very helpful and encouraging to many on this forum - myself chief among them. Enjoy your footy time and have a great weekend.
Cowichan,
I think the death of South African Gold production was predictable to a fair degree. Deep mines, thin vein underground, hot mines, expensive mines, dangerous mines, use of cheap desperate labour to finance the mines, the end of apartheid, questionable management practices and competencies...etc. Hours in travel time to get from the surface to the mine face....
What is going to be interesting is the gold mines of the future, My bet ... large (easier to find, block cave), deep (all the shallow stuff has been found and taken) and these will be lower grade. BUT its not the grade that mnatters its the margins...you can have high grade and low margin, and the reverse is true...
best
the gnome
Cowichan
"This isn't a growth share. It's midway through its life cycle"
As I commented on before I knew a very profitable gold mine in west australia (or 3!), that only ever had about 2-3 years if mine life....
and so it was always in the back end of its life, but it went on like this for more than 50 years.
I know some old gold mines which were shuttered down, at the end of their life, and some bright young thing came along, drilled some more holes int he right place, and added another 20 years onto the life of the dead mine!?
Companies have been built on old gold mines all at the end of their life..LOL Have a look at Northern Star's History...built on old dead Mines at the end of their lives!
https://www.nsrltd.com/investor-and-media/asx-announcements/2005/october/2005-annual-report
Did they find a new mine? No they were a lot smarter than that they bought old Gold MInes, and got them to work, did smart exploration...company now has 20 years of mine life, 2 m ozs pa of gold production from mines "past their mine life"
Mine life, is function of dicovery, and this can be a function of the cost and time to get cost effective drill access to best get enough pierce points into a orebody, to get that orebody rated as JORC compliant reserve. It can be a function of the board, the management , the exploration technology,... the exploration manager.
In fact one of the mines I worked in did not have time to get the ore interestections into reserve, they just went for it.
There are some very naieve comments on this board, which does suggest that quite a few, have never worked in a mine, and if this is true, then it is very easy to not know how they work. Conclusions based on no knowledge can be misleading.
Can I suggest (again), the Extraordinary Popular Delusions and The Madness of Crowds (written in 1841, and nothing much has changed from a behaviourial sense):...all I can say is make sure you are not one of the crowd, get some real knowledge, and don't follow messiahs with no clothes on...or idle chatter on chat boards
Footy game tonight! Must limber up, ....
best
the gnome
IN 1997, when Randgold Resources listed on the London Stock Exchange, about 2.5% of world gold production was being dug in West Africa, of which most was from Ghana. In contrast, South Africa produced more than 15% of total world production.
Two decades later, just as Barrick Gold absorbed Randgold Resources in a merger that left a gaping hole in London’s gold investment market, the picture could hardly be more different. West Africa comprised 12.5% of world gold output, largely owing to major new mineral discoveries in the francophone regions of Mali, Côte d’Ivoire and Burkina Faso. South Africa had become a relative minnow in the gold mining stakes, worth only 3.2% of world production, according to data from the Minerals Council South Africa.
The prognosis of those invested there is that the West African region will grow its production base further. “West Africa will overtake China in the near future,” says Sébastien de Montessus, CEO of Endeavour Mining, a company whose ambition is to become London’s go-to gold share, filling the vacancy left by Randgold in 2019. Six of the world’s largest gold producers by market capitalisation have a presence in the West African region. “I expect it to grow faster than other regions of the world.”
West Africa attracts the most gold exploration spend after North America and Australia, and consequently has been host to an estimated 79 million ounces in new discoveries in the past decade, the most globally, according to S&P Market Intelligence. But it’s risky operating there.
In the end, De Montessus believes it boils down to a risk-reward equation investors will have to assess. “We feel that this is the place to be,” he says. “Some investors will be looking for, I would say, moderate risk, which are probably [areas in] North America or in Australia. But they have less reward.”
“When I started in the early Nineties it was risky; much more risky than it is today,” says Mark Bristow. “Mali is the very foundation from which we built Randgold, but it has always been a country of risk. It worried me most,” he says. “But it’s the country that has delivered the most as far as our exploration success goes.”
De Montessus has high hopes for the listing. “We will be the largest pure gold player on the premium segment and I think alternatives in London have been mainly Russian assets – companies exposed to Russia – so we have an attractive proposition.”
https://www.miningmx.com/top-story/47434-west-africas-political-whirligig-wont-keep-investment-dollars-from-its-gold/
---------------------------------->>>>
My Thoughts:
Few in the retail investment community predicted the fall of South Africa and the rise of West Africa in terms of gold output. Therefore those of us interested in growth for Centamin would be unwise to write off Burkina Faso just yet. Similarly, Egypt could easily repeat the feat - becoming the next great source of world production in ten or twenty years - with Centamin at the f
Cowichan - we are all frustrated at the moment (my average is about £1.20) but I must admit I am also having second thoughts about how prudent it is to hold these shares relying on "consistently generous dividends". I agree with Rebess that "for every pint of dividend received, a gallon of share-price has been sacrificed to pay for it". It fell 5% on the last ex div date breaking all the TA support lines on the way and allowing further heavy selling this week! I am really better off without the divis if that's the price I have to pay.
My buy order is in at 90p should it get there…..
You should have words with the ex EU Brexit negotiator Michel Barnier, mrtibbles currently demanding French sovereignty from European courts. Didn't think you could pick and choose parts of the treaties!
Brexit is certainly not muted as far as the rest of the world goes, since dropping out of the EU the UK is all the more isolated and no longer has the same bargaining power with the rest of the world, it's been given the sh(it end of the stick in every trade deal it has supposedly negotiated post Brexit and is now regarded as "The english patient" by the main players in world events which will affect with the overall UK economy.
In turn the survival of many UK companies profits and their ability to carry on paying dividend, people may lose their jobs affecting their standards of living , the price of basic's, rising energy and utility prices, withdrawal of universal credit, so less to spend, less to invest, rising national taxation and increasing debt making it almost impossible to consider raising interest rates for the near future.
The so called government training schemes have been a smoke and mirrors exercise to disguise fact that their really has'nt been any the commitment to proper apprenticeships in UK industries for many years!
In the main many of our own UK people aren't willing to do he jobs that the former EU immigrant workforce used to do and despite what some choose to believe employers won't want to increase wages by very much, they have done the numbers and in the long term there far cheaper options that never ask for a rise, holiday, pension or go sick are on the cards, even better the cost of can be written off against tax!
Companies like Ocado ,Amazon, Boo Hoo, major retailers, NHS, various service providers and others have appointed robotic experts to their boards and are now committed to replacing many manual, store , customer service, and distribution staff with computer program's and robotics, these are produced in countries like Japan
Many companies and businesses want to claim any grants going, but don't really want to commit to employing people long term, especially when they can rely more and more on robotics, also forget working in the "just Eat, Domino Pizza, Burger" kitchens that produce the fast convenience food people order on their apps, the kitchens are being moved to industrial estates and robotics will be taking the orders and putting the food togethe , then it will be delivered by GPS guided pavement trucks and drones!
https://www.bbc.co.uk/programmes/b0150m8m
https://www.businessinsider.com/companies-that-use-robots-instead-of-humans-2016-2?op=1&r=US&IR=T
https://www.dailymail.co.uk/sciencetech/article-5808319/Amazon-100-000-warehouse-robots-company-insists-replace-humans.h
https://www.bbc.co.uk/news/technology-36376966 from 2016
So what do fortunate to be in employment reasonably paid people invest in, Centamin may well be a good option at a bargain price considering that AISC will start to fall off next year and continue to decrease as Sukari output rises to some expected normality , a safe divided and a readily rising share price especially if POG rises as many predict.
Here's some of your comments: "This isn't a growth share. It's midway through its life cycle"
How so? Every miner has depleting assets. Barrick, Newmont, Agnico Eagle, Kirkland Lake. If you are going to label Centamin as such you have to label all miners as such. And that doesn't begin to take into account exploration or development as exploration. All miners depend on the same formula. Drill. Drill. Drill. Randomly placing Centamin as midway through its lifecycle is nonsense and ill informed by any measure.
Another comment: "we are trying to extend the life of the mine for as long as possible until the reserves run out and hope that we can find another Sukari in the meantime. Unlikely given Barrack golds entry along with their huge financial armoury"
Do you understand how orebodies form? The reserves will grow as long as the source of the orebody continues along strike and at depth. It doesn't fall from the sky like manna then you gather it up in baskets until nightfall.
Last comment: "Buy and hold strategy for this share is unwise."
For whom do you offer this sage advice? Those who despise consistently generous dividends and fantastic growth opportunities in Egypt and Cote D'Ivoire? I suppose if that is your target audience then yes, by all means encourage them to sell.
Hoping up from here , could do with easing my loss on this
I can't disagree with anything you say in your post Franky . A healthy dose of pessimism tempers all losses. I like reading posts like this . They help me to calibrate positive comments within a wider context
Even though this has little to do with CEY I would say check out Octopus Energy ...they act as the supplier of last resort in the wider energy community ..i.e. when other energy companies go bust
Thanks Mr Tibbles for your views. When you look at the bigger picture though , gold is an international commodity or precious metal and Brexit is a UK only (and poss an EU) matter only. In short it has a muted effect on world gold prices and Egyptian costs of mining. . I am more concerned in WORLD global events happening in particular in US, China and Russia . Brexit in the UK is like a zit on the nose of world gold prices .
I don't think the pay is the whole story. at £32K avg there should be a queue for young people to take their test.
The problem is this govt never has supported the training adequately.. Grants are hard to secure and loans are a bit of a gamble. I spoke to a driver who took his test 4 times before passing. Even if you pass 1st time you probably have shelled out £2K.
To be honest I would say it is the lifestyle that puts people off.
no we cannot having worked in the food industry most my life. Long unsociable hours do not suit most people - particularly when benefits are available to supplement more palatable part time jobs. Not sure what its got to do with Centamin.
Last,6 months went from 120p down to 91.5p well so far anyway, what will the next 6 months be like?
The lack of lorry drivers is not only caused by Brexit and I am increasingly frustrated to hear Brexit used as an excuse for everything. Someone from Iceland (shop not country) management was bemoaning the lorry driver issues and casually blamed brexit. He stated that he needed six months to train a lorry driver, we have known that Brexit was going to happen for years not months, why did he not take action and prepare for it, either getting drivers into training or making sure that the UK based drivers they had were keen to stay. Most interviews with drivers have given the same impression, younger people are not looking to join the profession due to the appalling pay and conditions. Perhaps sorting that out earlier would have prevented the shortage of drivers rather than just waiting and using Brexit as a scapegoat. The same applies to the lack of other 'seasonal workers'. Why should we expect EU workers to do jobs for pay and conditions that UK people wouldn't accept?
I voted to remain but Brexit happened, that's life.