Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Rivaldo I am a firm believer in eitehr making your own luck or if this is not possible at least not relying on luck itself to carry you through. They had one definite piece of luck and that was not acquiring Norpalm but not for a want of trying. They have in fact had luck in the spike in CPO prices but no real capitalising on it except to produce what they produce best which is excuses. It is six years at least of the Mill in operation and not any traction towards full production. I pointed out the production profit warning contained in Q4 at the time. Nice of Lincoln to save time with 3 months advance warning of a rinse and repeat. There was a time when DKL reminded me of the England football team as they couldn;t string two good results together. Now they cannot produce one good result. Lincoln has peddled this strong start to "......" nonsense before. Yes strong start to all six or seven days of April so far.
This really is a dog ate my homework share. Excuses after excuses are wheeled out for poor performance for a board that give me the impression at being asleep at the wheel for core services while chasing dreams in non core areas. Now they have dreamed up a new project when none of the current ones are satisfactory for one reason or another.
Like many others here I am holding on more in hope than expectation. I have asked the BOD many times at the AGM's to get a grip. They have shown no evidence to date that they have any grasp of this. I say every year at the AGM that the challenge is to improve the SP between one AGM and the next. Abject failure there even at these low levels.
I keep hoping one quarter the company can show they can reverse this death spiral in the SP all the way down from 20p. Let us see what Q2 brings apart from the usual litany of excuses. Some emphasis on production of you know like CPO would be useful instead of "Look! Over there! There is a squirrel."
Latest puff piece.
https://www.youtube.com/watch?v=VqMzQMfAcZs
The audio cuts out after 2:10 until 5:06
Palm oil
"January like a low season month."
Picked up "significantly in March, record production".
"Strong start to April"
Rest of Palm oil and all of Cashews bit missing.
Energy
Seems to be repeat of RNS, sounds positive.
Additional projects
Have been assessing 4 or 5 commodities and has become clear best way to go. They are just "finalising the sign off of that internally" and will announce when ready.
Moving forward with all projects, currently "uninterupted". Drop in global CPO price "annoying" but still higher ebitda than last year. Not unrealistic to suggest two projects (palm and cashew) in normal conditions to soon be generating ebitda close to our current market cap.
Send in questions, etc. He's "happy to look on the chatboards"! and will answer and update shortly.
Guitry is frustrating but my understanding is efforts have been redirected to non CPO ventures instead to mitigate the cyclic nature of CPO.
Morning rivaldo, yes I make Q1 revenue on CPO sales around €1.1 million more than Q1 2019, despite less FFB collected and therefore CPO production/sales. It would appear we now have 1000 tonnes of CPO left in the storage tanks?
Like you say, a mixed bag. Record March in terms of fruit processed but (FK1), it would appear high season didn't start in November this year! It's always good to see record FFB's, it's one of the things I am constantly looking for amongst the usual doom/gloom and window dressing - although this quarter, that may have just been due to later start to peak. The board need to prioritise greater collection of FFB and keep ramping this up for when things do improve.
3 month delay on cashews. Not bad considering all that is going on, but as you say rivaldo, that is a series of what ifs.
Internal feasibility studies on potential fourth project completion sounds positive, although this could be more window dressing and unlikely to be anything for a few years at least.
A final positive - "We will endeavour to provide regular updates...…." - well stone me!
DKL are a company who are forever not quite getting there/suffering from bad luck but whose potential is obvious.
For example, (1) at just the time when CPO prices were peaking, the 2020 high production season started late! So Q2 will show higher production, but prices will have dropped due to the pandemic. And (2) the cashew milling tool manufacturing just happens to be in Italy, so couldn't be in a worse place. And (3) the delay in this production of three months, which ordinarily is neither here nor there, would be enough to miss much of the Feb-May'21 cashew high season.
The good news is that Q1's figures should nevertheless be pretty decent (fingers crossed) given the 28% rise in average prices over 2019, with positive EBITDA.
And operations for both palm oil production and cashew preparations are continuing nicely with minimal disruption.
I can see Aristide Achybrou buying more shares if the price remains at these levels, and I may well do the same. But I suspect patience is the watchword.