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News is already in the market.
Based upon a long term price of $1750 gold per ounce.
1. Sukari measured resources at 7.45M last year. $125 x 3.725M on 50% conversion to reserves = $465M.
2. Indicated and inferred Resources at Sukari $60 x 2.75M= $165M
3. West Africa assets value at least $100M.
4. The company has $313M in the bank as of 30 March 2021.
5. Sukari Reserves are 4.4M ounces and with a full mine fleet and plant in place x $200 = $880M (50% depreciation of all plant and property is $400M value).
$1923M = £1354M shares in issue = 1157M = 117p
Liberium assumed no additional ore bodies which I fundamentally disagree and the company March issue said there was from exploration work done in Q1. Say it is a reserve of 150,000 ounces found over two years. 117p+ 2p = 119p
All Liberium has actually done is take last year published net assets and took last year sterling dollar rate at 1.35 instead of 1.42 and guess what you get 82p.
If he does there is talk of another USD6 Billion then it will be interesting to see if this has a positive effect on Gold prices -should do.
Perhaps then we will return to full value rather than a discounted one from what one analyst has said!
Thanks for the reply.Your comments make very good sense.Technically, a bounce around 110p is seeable.But with the negative broker comments and the steepness of the fall,one wonders if if it can build a base from here,from which to continue upwards.
It could well be a bumpy ride,at least in the short term.
I rebought some too and will add more if the price drops.
Thought you’d all like to know I’ve just bought in again
Pipe dreamer you asked for tips on working out what Cey is worth
I they to work out the profit for this year, next year and 2023 at this gold price, multiply by say 12 to get a reasonable price now and in next couple of years
then work it out for gold at 1600
and gold at 2200
I make this year profit at current price around £60k profit meaning our share price is too high
But £120k in 2023 which makes our shares cheap and too low
Conclusion, Cey is still a bit above what it should be now but way below what it should be in 2023 at current gold price, which helps explain current sellers who just don't believe we will double in 2023 given Centamin's history of setbacks.. I though our price was beginning to look forward to 2023 so picking up Of course if gold price rises or falls that changes things, and makes it better or worse. So I hold even if the price is a bit high, for higher gold and higher 2023 profits all imho
could also argue also that the uptrend has failed despite and the downtrend continues despite the PM rallies. I feel more comfortable adding at £1.
As I said no science, fair value is based on estimates and assumptions which are at a point in time and subject to change. Not to be relied upon solely as recoverable.
Fair value represents the estimated worth of various assets and liabilities that must be listed on a company's books.
Key Takeaways
In investing, fair value is a reference to the asset's price, as determined by a willing seller and buyer, and often established in the marketplace.
Fair value is a broad measure of an asset's worth and is not the same as market value, which refers to the price of an asset in the marketplace.
In accounting, fair value is a reference to the estimated worth of a company's assets and liabilities that are listed on a company's financial statement
HTH
As an FCA for almost 40 years, I have seen that fair value is based on so many assumptions that when these are tested can come up with different fair value valuations as such.
Amazingly with shares fair value can also change, in an instant systemically, eg Trainline where the fair value changed on news.
Well CEY is half price again from the highs last year
Auscon yes agreedthere is that to it as well. So clearly market price is not linked to Fair Value.
I am hoping Adrian77 will "put his money where his mouth is" and explain / substantiate his Fair Value SP calculation.
That way we can have a reasoned discussion
So far the silence is deafening.
Somnamna,
Market price is really only the value of the marginal shares traded ( short term ) so is in effect somewhat meaningless. If, and I strongly think we will see POG at well over $2500 £1.10 per share will seem like a bargain !
Gap filled on the chart @ 110.35 should move up now
Expecting this to bounce by close ...when everyone thinks this will go down a few pence more ..that is the time to buy ...market never follows what you think
Can agree on Market Price MaryBr190 but not Fair Value.
Market Price is a fact of life decided / manipulated between buyer and seller so there can be many drivers some visible some hidden from view.
Whereas Fair Value is a calculation, admittedly some of the constituent parts may be subjective, but a claculation nonetheless.
this will be 135p+ before November. no brainer
The is no science on SP movements and fair value. The SP is sentiment driven. invest at a comfortable price for you and trat movements as an opportunity to add or reduce exposure / risk.
Impossible to time precisely.
FWIW I think the SP it will go lower short term, but I am starting to rack back into my holding at these levels even should the price to lower will keep adding.
Lets not jump to disparaging comments.
See my post Fair Value SP.
Adrian77 has opportunity to explain / justify his figures.
In Life certain things are very strange.All on here seem very sensible,knowledgeable, and know what they are talking about,especially the Fundamentals of this company.
Why then is the truth of the worth of this company,is at opposite ends of the scale.The truth about anything must waver,at worst, in the middle range,when nobody is sure,(e.g. Brexit ).
It CAN'T be at opposite ends.The consensus should be that it is either bullish,or it's bearish or it's a "don't know", (as in election polls,Brexit etc ).Truth about something should not be, and cannot be at opposite ends of the scale.
Yet here we are,and if we include brokers,we have an opinion of 82p and 150 p.
The problem,is how we get around this and get to the truth ,as to the true value of this company.Any suggestions as to how we get around this ?.It's an important question that the answer could well help us all,in the future,not only in Finance ,but in all matters in life that we come across in the future. If we can work out the answer,success will follow.Any tips and advice on this ?.
Whenever the price dips, I try to look at it this way :-) , more shares with the dividend. Did they mention what the predicted dividend will be later in the the year? I thought it was supposed to be quiet a high one? I'll reinvest that one as well then maybe think off taking the cash in futre. Ive been in Centamin since 2012---------------kicked myself plenty of times. I sold some RMG last year when they were about the same price as Centamin! (That one is still hurting!) . I think I am actually down on paper with Centamin now, without the divis, but hoping that things will work out with the new bloke and the licensing round Sukari. THE COURT CASE! --------------will we still be alive when that gets sorted ?:-)
If we get the land round Sukari, maybe the safest option is selling off the African projects and focusing on Egypt?
Of course it wasn't coincidence that Liberium came out with their lowball SP on the day CEY should have been basking in the glow of a 200 oz future development, with the result the SP was knocked.
I am not saying CEY Management were complicit but there were a lot of others involved in the WA reviiew and studies and the timing of the RNS could easily have leaked.
There are a lot of crooks out there including so callled professional investors and market makers. Also as I have explained before CEY being cash rich, literally a gold mine and low cost to buy and sell (no stamp duty) is a traders dream.
So my take on the Liberium SP announcement = skulduggery.
Sad because of good work by Martin Horgan CEY had a good story of a 200 oz development in the pipeline plus possible disposal of Beattie West.
From my post 2014
The profit share will be what the profit share will be – the joint venture partner, ie the government, sits in the 50% owned subsidiary Sukari Gold Mines. The management board of this subsidiary has representatives of the government and an equal number from Centamin. All of the investment into the Sukari mine is audited, with Sukari Gold Mines very much being a part of this process. Similarly, all gold sales go through Sukari Gold Mines, where the operating surplus will be divided 50/50 between the government and Centamin, once the original capital has been repaid back to Centamin and its shareholders. The 3% royalty has been paid to the Egyptian Treasury ever since production started (this also goes through SGM).
With the above in mind, there is no issue with regards to the money that has been ploughed into Sukari, particularly the costs of Stage 4 (c.$350m) – this needs to be recouped before any of this operating surplus can be shared. This is not due to kick in until later this year, or possibly in Q1/Q2 next year. It is all a function of the ramp up in production and the gold price.
There is no dispute between Centamin, the Egyptian government and/or EMRA, nor the 50/50 Sukari Gold Mines subsidiary. What you are getting is probably a series of people mouthing off that they want profit share now. This is a political game more than anything, as the deal is the deal (in fact Centamin have advanced the country a few million dollars as a demonstration of their faith in this deal – this will also be recouped out of future operating surpluses due to the government).
What is wonderful is that very few people seem to understand what this 50/50 deal is – it is effectively a 50% tax on free cash flow. In fact the 50% will not kick in until 2016, as in 2015 this will be 45%. To counter this there is no VAT, no corporation tax, no other taxes to pay all beyond the above and the royalty, which on a blended rate compares reasonably well with other 1st world mining jurisdictions (like the US, Australia, Northern Europe etc).
See page 51: after the deduction of royalty payments and the recovery of costs and expenditure as provided in paragraphs b,c,d and e, any remainder of sales revenue shall constitute net proceeds and shall be shared between EMRA and Centamin.
(See the details in the pdf file. Alternate pages in Arabic & English).
http://gate.ahram.org.eg/Media/News/2017/2/26/2017-636237441861789391-178.pdf
Some figures from Mr-Yousef El-Raghy in case some of you find it useful:
-$12.2m advance profit share paid to EMRA in October 2017.
-$136m total advance profit share have been paid to EMRA since October 2016
21/11/2017
https://www.arabfinance.com/2015/pages/news/newsdetails.aspx?Id=416470&lang=ar
2018
https://www.egypttoday.com/Article/3/58671/EMRA-proceeds-4-5M-on-profit-account-from-Sukari-mine
Auson and Adrian work together but we don’t know,who they work for.What a coincidence,he is registering today to give us very useful advice????
Market detached from reality where Liberum note concerned.
Peel Hunt issued their own just yesterday with 150p target. All other brokers consider CEY a buy, with targets 120p upwards. Liberum the anomaly.
Conditions perfect for increase in price of gold. CEY has generated an enormous amount of cash past 12 mos. and will likely continue to do so.
Market missed the mark, in my view.