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Hi Barna - yep - it was interesting wasn't it, hopefully on the lower scale or below of the Grant Samuels evaluation then :-)
Great post Dip
I find this interesting
Joshua Wolfson
And then, sorry, just one question if I can sneak in. I noticed the book value for the assets that are held for sale is $5.7 billion, which is quite a large number as compared to the $2 billion targeted. Any sort of comments there on how we should think about pricing or what the targets are effectively?
Karyn Ovelmen
No, not necessarily. I think from an accounting convention perspective and how they're reported from a GAAP perspective will be obviously considered, I would assume by potential buyers. But in essence, the process of going through the commercial view of the assets and the value to the potential buyers that will produce something most likely different whether it's up or down inefficient versus what is recorded on our book from a GAAP perspective.
That makes the asset sale on average about 60% off the Newmont valuation .
5.50 are buys btw
I will continue to top up, although I never thought it could actually be in the 4’s!! If next week continues the trend, it will be.
Daniel Major
The second one, you've talked detailed a lot of the progress you've made since the integration in Newcrest. In these kinds of deals, I guess there's always positives and negatives. What's the toughest part? What's been the most challenging or almost difficult part of the integration so far?
Thomas Palmer
I picked that one up. The thing by far away, Daniel, is that the tragic loss of Adam Kennedy's life at Brucejack on the 20 of December last year. And as you reflect upon the integration, you reflect upon what things could we have done differently, what decisions could we have made differently that wouldn't have led to Adam being killed that day at Brucejack.
I think, as you've said in some of our remarks as well, I think stepping back from the loss of Adam and safety, I think the two areas that we are working through diligently tailing facilities, and we've talked about Telfer and we've talked about our Cadia and little bit around Red Chris. So just bringing those tailing facilities into the Newmont standard and ensuring that we have the appropriate rigor and discipline around those in managing them here and now, and ensuring those we shepherd those going forward that they have the appropriate standard.
And then the third one would be bringing the ore body knowledge levels up to a Newmont’s standard so that we've got really robust all body knowledge underpinning our mine plans. So that will be the three areas where there's been, I guess the hard work. I think if I step back from that with the perspective of having lived through a similar integration and transaction five years ago, I think, when I stepped back from those three areas, I think the integration has gone very well and I think we had the benefit of being able to apply the lessons we learned from integrating the five Goldcorp assets back in 2019 to this exercise. And that's put us in good stead.
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End
Jackie Przybylowski
And maybe if I can ask as a second question, just going back to your divestment strategy, I know you have a number of assets that you're looking to sell in Canada specifically but also, I guess globally as well. Can you comment at all, like, is do you have a preference of selling that's in sort of groups or bundles? Or are they all expected to be sold individually to different buyers? I mean, I don't know if you can make any comments on how you're thinking about that?
Thomas Palmer
As I mentioned, in the -- asked earlier question, the process has started on all six assets. We have engaged banks and have started a process on all six assets, and we're in the process of price discovery through a Phase 1, and active interest. So we are getting a good feel for the level of interest in these assets and the competitive environment that we're hoping to enjoy. And we're running three separate processes in terms of, because they're in different locations.
There's a set a process for Telfer in the Australian context with a dedicated team looking after that. There's a process for Akyem in the African or Ghanaian context with a separate team looking after that. And there's a process for our North American assets, the four operations plus the coffee project, and a team getting after that for being led by Peter Toth that's Scott Langley. But up and running and very active, as I say, we're in Phase 1, and quite excited about the level of interest and the competitive environment, which we are presenting these assets to prospective buyers.
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cont...
Highlights from Q&A:
Operator
Our next question comes from Josh Wolfson of RBC Capital Markets.
Joshua Wolfson
The team has painted a fairly rosy picture here on what the prospects are for asset dispositions, and then also what the free cash flow outlook would look like absent some of these working capital headwinds. In that context, I'm wondering how flexible is the company's buyback policy? And I'm noticing the stock being a lot higher today than it was when the plans were announced for this at the fourth quarter results.
Karyn Ovelmen
As we go through the divestitures and as I've indicated as our free cash flow picks up in the second half of the year. First priority is to ensure that we've got that our cash replenished on our balance sheet. And then there will be flexibility in terms of as long as we have line of sight in terms of that debt reduction over the next 24 months, we would -- at that point in time, if we were in a position start to think about executing on share buybacks.
Thomas Palmer
And a reminder, Josh, we've got an approved $1 billion buyback program ready to go if or when that scenario, Karyn Ovelmen said out takes place.
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Joshua Wolfson
And then just sort of to clarify, when I look at even what a flat quarter would look like at much higher gold prices today, and again without this, some of the larger working capital challenges, even maybe one or two of these asset dispositions would put you in line of sight of that. Is it fair to say that the prospects for the buyback could happen sooner than maybe what the initial criteria were outlined for the balance sheet requirements?
Karyn Ovelmen
Expectations for the divestitures is that those will be executed within the next 12 months. Hence, the classification on the balance sheet is assets held for sale. So expectation is through first quarter of 2025 that we will have executed or made decisions around the divestitures. And so the timing is contingent upon that.
Joshua Wolfson
And then, sorry, just one question if I can sneak in. I noticed the book value for the assets that are held for sale is $5.7 billion, which is quite a large number as compared to the $2 billion targeted. Any sort of comments there on how we should think about pricing or what the targets are effectively?
Karyn Ovelmen
No, not necessarily. I think from an accounting convention perspective and how they're reported from a GAAP perspective will be obviously considered, I would assume by potential buyers. But in essence, the process of going through the commercial view of the assets and the value to the potential buyers that will produce something most likely different whether it's up or down inefficient versus what is recorded on our book from a GAAP perspective.
_____
cont...
Me too Matty, despite an already large holding that I’ve held for a similar time I’m buying whenever I can at these prices - I am of the opinion that there will be many wishing they’d done the same in the not too distant future, but each to their own!!
Newmont Q1 2024 Earnings Call Transcript
https://www.ggpchat.co.uk/viewtopic.php?t=914
Note: unfortunately some missing segments in transcript
Nice one ripley94
So long as we don't get thoroughly shafted (well and truly) just like Shanta share holders, with the company taken private by certain members of the BOD on the cheap and just as the $$$s started to flow, it should all come good eventually (very good IMO!)
Been invested here for last 10 years this July (pre NMT walking away from EG saying 'not at this time') and seen many ups and downs! Been one hell of a ride!
Still holding for the 'prize' and if my investment in SAR goes the way that I hope (as that's where I put what I had in Shanta) then it's all coming in here!
Just hope that the sp hasn't risen too much before then.
GLA
Very valid points on the sentiment and general market conditions. Here is the scary part - it might get worse according to some. Not aimed at GGP but at the markets in general. In the event that a coincidence of events trigger the fall in the markets it might impact miners in the short term but there is a high likelihood that even if they are impacted, the impact will be shorter and not as severe and they are likely to bounce back higher and stronger. So in short some more potential volatility (might be the understatement on the century) BUT along with other gold producers (by that time) GGP will be one of those life rafts in high demand.
".Without volume and favourable market sentiment etc , sp's are going nowhere .This has nothing to do with SD , but has everything to do with the current AIM market climate ."
Spot on. I shared this video yesterday and 16min48sec Bob discusses this very topic. Volume, sentiment, and when to buy. Worth watching and only a few minutes of your time.
https://youtu.be/ML_xEzuVRf4?si=vJsaLki-cutwhKp4
Petejh, thats a fair and balanced post . An associate of mine was in relatively early with around 250k invested .He watched his holding soar to around 3 million quid and still refused to sell .He is back down now to around break even .I suppose we can all use hindsight to influence our emotions , but that chap must be seriously fed up now .I remember the " sit on hands " advice well . I also remember people buying in , in the 30s and watching it rise to nearly 40p .Its hard to believe what has happened here but its not just ggp that has suffered. I put most of it down to market sentiment. AIM was everybody's darling in 2020 , but money has moved away from the juniors , and that trend has continued for 3 and a half years .I also think there's a tremendous amount of under counter skullduggery going on too .At the moment it doesn't matter what companies are doing ,or how juicy their assets are .Without volume and favourable market sentiment etc , sp's are going nowhere .This has nothing to do with SD , but has everything to do with the current AIM market climate . And looking at the evidence, if GGP discovered another havieron tomorrow, some organisation would attempt to mark it down .These are pretty much unprecedented market conditions , certainly worse than i can remember, and im going back a long time too .
Petejh - a couple of observations:
1. This is mining - 7 -8 years is roughly half the time for a normal discovery to translate into production - and remember on a small % of discoveries ever make it to production.
2. Investing in the early stages on hope is a strategy - its a high risk strategy but it is a strategy.
3. Well done on monetising your profit as you did - many here are envious and wish we have studied and understood the Lassonde curve back then.
4. Having now researched more fully the Lassonde curve I am looking forward to the second and larger wave - not guaranteed but the POG and copper upsides and disconnect between miners and POG could make the second wave steeper and longer than many think possible.
5. Put some of these shares into my pension pot - long term - its my strategy
6. Psychological games - 100% - the games represent a huge % of market activity and played at all levels. Anyone thinking the Fed is not playing a game at the moment for example might want to think again China is playing a game - a very open game for anyone interested and wanting to take note. The only question there is how much of their CB gold purchases are not disclosed.
7. Despair of PI's - yep I get it. In part a reflection of todays instant gratification culture and also I suspect as result of inflationary pressure on day to day living and a back drop of falling SP - a double whammy.
8. Your recommendation to switch off - agreed - although my money is on this flying in time.
ATB
A lot of nonsense talked about MM's and manipulation - the bare fact is that GG is spending a lot of money with no income stream - they want to mine Haverion but havent the money to get the other 70% over the line - its still not clear and nobody will answer the question - who is going to pay the other 70% just to re-start the declibe - I currently think nobody - so the decline will not restart until the who owns the 70% is decided...the aquifer is a convienient excuse/stop point until the new owner of the 70% decided....I thought I would come back in at 5.5 and had order to do so yesterday - but now i think I want to come in at less than that..
Hi Pete, same boat as you, made a killing at the high of the share price, now on a free ride but must admit its not great to see free money evaporated by the aim casino, so bottom draw for now until the crooks finish with there dodgy deals.
The same pattern of the last few days
A Market Maker is being supplied with shares from an Institution soon after opening, therefore a marked-down to get rid of them. And it seems PIs are happy to get some at those low prices.
Have they finished selling them?
Gold price UP by $18 to $2348
"I do think a psychological game is being played here on GGP holders - gold and copper are ripping and looking like it's the start of the next long-term uptrend. To deflate the GGP price in this environment has 'force some pi's to capitulate in despair' written all over it. So if long term holders are feeling he pain here then they'd be wise to switch off and ignore until it eventually flies .."
I agree. The disconnect between the share price with the gold price, copper price, resource size, resource potential etc is surprising. Until we have clarity on the future direction of Telfer + Havieron I wonder how long this will persist for.
Q3 for the dewatering to be completed I think
Zoros that's all very nice but a strategy of waiting 7-8 years for an uncertain return on your investment is no strategy, it's 'hope'.
Someone could write a book about the lost generation of investors in GGP who didn't sell high when they had a chance to make huge profits. I'm one of the few who actually made a killing on GGP and it was by selling when they were stupidly overvalued at the peak of the exploration excitement in 2020/21. I've kept half million shares in the bottom drawer for the endgame. Hopefully the story ends well, I'll enjoy the little uptick in my remaining holding if so but it doesn't matter for me.
If I'd held the lot - because of the 'future sunlight uplands' then it would have been one of the worst investments of my life and have cost me so much in opportunity that instead I got to enjoy over the last 4 years, while other investors have sat on their hands thinking wishfully while unable to utilise the money for anything else. I do occasionally wonder if the fabled cheerleader 'PaddyGall' ever sold any of his tens of millions shares at the peak. I hope he did. Or if he sat on them all and is now looking at a gargantuan cut to the gains he possibly could have had. Still, just a bit more patience and long term investors might eventually at some point get nearly the return they could have had 4 years ago... Truly bonkers.
I do think a psychological game is being played here on GGP holders - gold and copper are ripping and looking like it's the start of the next long-term uptrend. To deflate the GGP price in this environment has 'force some pi's to capitulate in despair' written all over it. So if long term holders are feeling he pain here then they'd be wise to switch off and ignore until it eventually flies or properly crashes. Both outcomes are still possible.
The decline we need is not in the sp but at the mine. Is the dewatering of the acquifer complete do we know?
So contact GGP
Still no communication to ease the drop maybe ...SD all talk but not when it matters !!
Andrew Bailey is a typical Civil Servant in charge of Finance and
no understanding of AIM which is ruined by thugs.
LSE ?
Interesting all those 1000 share buys at 08.20 this morning.
One thing is for sure they are not paying £11.95 dealing fees with HL !