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Guvvi,
Yes.
But to be honest, when you look at the Q1 Production RNS it is pretty obvious really.
In addition, are you aware of the VAT issue following the sanctions being imposed?
BB2
One final question... they explicitly stated funds secured for kouroussa had been used on yanfolila?
thanks again, very informative.
Guvvi,
Pushing back KOU timeline also an option. as would be asset sale but DB did state lengthy DD process would delay funds from this option.
Hopefully, AK can continue to turn YAN around to provide cash flow. However, I believe we are currently "behind the curve" on this so ground needs to be made up in H2.
Must say that AK was very impressive. However, sometimes things can happen outside of the Company's control (see the GRL RNS today as evidence).
BB2
I can only hope and pray that they're lining up a mate's rates placing - that would be fab.
Could you not have left the last bit out?
It was pretty positive until then!
Adam.
Good summary that of the Operational side at Yan.
My notes that I made stated...
that "utilisation rate" was now 88/89% compared to 50% previous (target 85%). In addition, I noted that we were losing a total of 100 hours a day due to breakdown/repairing and that is now down to 6 hours a day.
I also noted,
"volumes were up over last 8-10 weeks"
"volumes back on track" however "spacial compliance" taking longer
"seeing improvements last 6 weeks"
DB stated "seeing significant progress"
AK back in Mali today, meeting tomorrow re UG with team of mining engineers and geologists arriving Monday,.
AK back on site over coming weeks.
In summary, Yan was in a right mess (failure of equipment and the time taken to repair), much more than you could imagine . AK (who I must say gave a VERY technical analysis) seems to be turning things around. We should certainly see some benefits of this in Q2 production. However, I believe it will be Q3/4 before we see the full benefits (free cash flow to pay towards KOU) of the remedial action taken.
I also notes..
Yan currently on target to meet 2022 guidance (as guidance was skewed more towards H2 than H1).
Kou currently still officially on schedule & budget (however some of the Kou loan funds have been used to support Yan in H1 which will need to be "replaced". How they are "replaced" is the golden question.... cash flow in H2, defer creditors, additional lending, placing.....
Currently drawn $77m of the $100m total loan....
More on the liquidity issue later....
BB2
Yes, I'm sure ;)
I can see both sides re keeping an interest or offing it completely but as I'm very confident that it, alone, is worth 2.5x the current SP/mcap to HUM it's kinda moot in the here/now.
As for Yanfolila - well if they're going to keep it going (I care not whether they do or do not) and it's likely to keep losing money over the next 12 months at the current Gold price then simply shut it down IMO - it's irrelevant at this SP/mcap IMO.
Anyway, the money guys are going to do/say whatever they're going to do/say, the disconnect between saleable value of Dugbe (and Kouroussa) is so big now that it's just a waiting game for the value to out - I'm patient and buying through H2, regardless of the price, same as my own physical Gold buying.
Just to clarify. I don’t think they have given last years contractor the boot. I think they are referring to the change that happened earlier when the old contractor left. I can’t remember the timings but around Q1 last year I think.
Contd...
However, Dan did state afterwards to me that in the event of a sale, the required Due Dilligence etc would mean it would take quite a while for funds to be received by HUM.
Bonker,
This was discussed during meeting and Dan even asked for shareholder's opinions on Dugbe. Retaining some interest in it was one opinion but otherwise a sale to support Yan and Kou was another.
Maybe bonkers but this talk of liquidity risk is worrying when they talk about improving the operation. Yanfolila can lose us bucket loads of cash or not.
The board appear to be saying that the worst case scenario is possible.
Thanks for the updates guys. I had guessed that they had given the mining contractor the boot but, as far as I can recall, this is the first time they have admitted it. Probably should have done that sooner but at least it’s done and things should now be improving.
Sounds promising for a H2 turnaround then - drop a Dugbe sale into the mix around EoY plus whatever Gold gets up to and it could be a nice Xmas here.
thank you.
This is what I understand operationally has happened. When Anthony was appointed the mining operation was in disarray. Their biggest problem was the reliability of the equipment particularly excavators. They were down to less than 50% availability due to lack of maintenance and spare parts. 85% is industry standard, The old contractors were given the boot and the new ones employed. The new contractors are the biggest in West Africa and have the largest fleet and most robust supply chains due to the scale of their operation. Currently availability is above 85% but this is recent so will not necessarily be reflected fully in this quarters ASIC. In addition there is a bunch of workstreams aimed at improvements. Each will be incremental but together added up will be meaningful. For example they are moving to electronic explosives. Before each round analysis is undertaken so the ore body to be mined is moved out as one mass and its integrity maintained rather than being mixed with non ore bodies which would reduce the gold content.
Another reason for the low yield is that they have been mining in the middle of Yan East pit where alluvial flow has mixed in with the main ore body resulting in low yields. They plan to go back to the north side in Q3-Q4 where the gold is "tabular" i.e. not disturbed. Yields are higher which should thus flow through to ASIC.
We shall see - the results will be the proof of the pudding.
I'll come back to you on the financial later. Need to go now...
Can you just clarify this so i'm certain i understand what they're implying/you're saying? Whilst i got my holding verified and was planning to attend i couldnt make it in the end so the lovely Tracey got some questions from me which she said will be answered.
They are saying that the COO is making improvements? Their forecasts for production this year are still roughly accurate even halfway through it then?
The risk is that despite this 'liquidity risk ' exists i.e Yanfolila and Kouroussa might create too much debt in the short term/medium term?
This seems tough to take out of context maybe you can help @adamsmithfreethi ?
The AGM lasted 2hrs - I felt personally that I managed to ask all the questions I wanted answering and they were all answered obviously within the rules about information flow.
Was Dan humble? I think frank and honest were the two words that came to me. Now I might regret saying that but that's how he and the other Board members came over.
They did NOT sugar coat the problems and recognise that there is risk to the business. Providing Anthony continues to provide significant operational improvements the risk lies mostly on the liquidity side.
Morning.
Yes, the new Reserves number should drop today/tomorrow.
This just dropped:
SPANISH JUNE INFLATION RATE RISES TO 10%; MEDIAN EST. 8.7%
Any Ian Stalker chatter? Was Dan suitably humble? Or just business as usual?
BB2 - it was great to meet you yesterday.
S
Hi,
Following yesterday’s AGM, I am fully expecting the updated R&R statement to be issued today or tomorrow which, if correct, will meet the stated timeline of Q2 2022.
BB2