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Another one of those cryptic messages on social media yesterday, saying 2 days to go.
Makes me suspect an RNS is coming tomorrow (Friday). These guys should be assisting Savannah Energy (another of my investments) in Niger. Soraya & Lars, give Andrew Knott a call.
There is a post on both RAI's linkedin and facebook saying that exciting news is coming.
I wonder what it could be?
If one believes Soraya’s comments in the interims RNS from 7 September, this share looks undervalued, to me at least.
Usual caveats.
Best wishes,
CYB
After the recent horrible events in Mozambique, this is especially good news. Well done Soraya, Lars and team.
I continue to believe that this share will handsomely reward patient investors.
Best wishes, all
Should be reliable payers!
"The integrated facilities management ("IFM") contract is with the US Government to provide comprehensive life support and maintenance services for the United States Agency for International Development ("USAID") in one of their compounds in East Africa. These services will also be provided to the US Embassy as they share the USAID compounds. The contract is for an initial two-year base period, with the option for two one-year extensions. The contract value, including the option years and incentives, is USD 21.5 million and will commence in June 2021.
Soraya Narfeldt, CEO of RA International, commented: "We are delighted to announce this landmark contract which sees us working directly with USAID...""
Looks like a great in.
No comment from Rivaldo? Usually very much on the ball - and I see elsewhere he's up early this morning! :) Let's hope he's still in here.
Seems like a bit of upward movement and some large trades...
Any news incoming?
https://www.youtube.com/watch?v=_89Rn_1EyNQ
A bit at the end about the attack on the lodge.
I would like to share this news that had just come out in Portuguese about what happened in the Amarula Hotel (very tragic).
https://www.rtp.pt/noticias/mundo/mocambique-rtp-no-rasto-da-destruicao-na-vila-de-palma_v1310568
Encouraging - the Chairman has bought £50,000 of stock at 46p and more than tripled his shareholding:
Https://uk.advfn.com/stock-market/london/ra-RAI/share-news/RA-International-Group-PLC-Director-PDMR-Sharehold/84766073
Good news - hopefully this is permanent:
Https://www.thetimes.co.uk/article/mozambique-army-drives-jihadists-out-of-palma-after-ten-days-of-terror-062zscdct
"Mozambique army drives jihadists out of Palma after ‘ten days of terror’
Islamic State fighters who imposed a ten-day reign of terror over a town in northern Mozambique have been driven from the area, the army has claimed.
Chongo Vidigal, the commander of the operation, said Palma had been secured and made “safe� by the military after scores of people were killed and hundreds more fled the jihadists’ assault.
Escorting journalists and officials through the rubble of the town, Vidigal said the army had also secured an airstrip which is key to controlling the area.
etc"
As said previously, it really puts into perspective how insignificant the lost profit and revenue really is.
https://news.sky.com/story/unseen-pictures-show-carnage-of-islamic-state-attack-that-killed-british-man-in-mozambique-12265947
Canaccord yesterday reiterated their Buy, and reduced their target price to 75p (from 80p).
Let's hope P.Mawer's OK and Mozambique returns to normality quickly..
More prosaically, today's results and prospects look surprsingly positive to me.
RAI made 5.6c underlying EPS, i.e a P/E barely above single figures, plus had $11.2m net cash at the year end, around 10% of the m/cap. And there's an increased 1.35c dividend demonstrating good confidence.
And all of this sounds rather rosy despite Mozambique:
"Shareholders should also be aware that the level of business development activity we are involved in is particularly strong with encouraging new bid activity on contracts ranging from USD 10 million to USD 50 million in value. We have developed and expanded new relationships with large US corporations, setting up partnerships and teaming agreements for new projects in relation to existing global government programmes. Our recent teaming partner announcement with Cherokee Nation is a great example of this and we continue to pursue more contracts together. We are also now bidding on global UK government programmes as a prime contractor. These programmes run for 3 to 5 years, providing RA a pool of future potential work on long term contracts. Our new bids to existing clients see RA having the opportunity to expand our geographical footprint to a potential 5 new countries in 2021/22. This is an unprecedented level of new business activity relating to high value contracts.
We also expect heightened levels of project starts by existing and new clients as commercial activity returns to normal. Depending on timing, this could materially strengthen our financial position in the current financial year but, in any event, we expect the anticipated acceleration in activity during the course of this year will bridge to an even stronger performance in 2022."
Mozambique situation aside, very positive results IMO.
The news on the country manager rather puts the trivialities of profit and loss into perspective.
Feel for the LTH's here $10M is a big chunk of revenue for a $50M - $60M revenue company. I was going to buy back in the new tax year, think I will wait till the back end of this year before I decide. Though fingers crossed for you guys that they secure some big contracts this year and that 2022 numbers are decent.
"These security concerns, compounded with the impacts of COVID-19 and extreme weather, have led to delays to the overall energy related project in the region and to the suspension of our contract to build and operate an 1800-person camp"
Does this mean RA have suspended operations? Or the Contract was suspended by the hiring company?
https://www.google.com/amp/s/www.mirror.co.uk/news/world-news/mozambique-hotel-attack-brit-feared-23812370.amp
The Mozambique country manager for RA International is missing.
Security concerns says the company? People were killed in Palma and some of them were expats.
"These security concerns, compounded with the impacts of COVID-19 and extreme weather, have led to delays to the overall energy related project in the region and to the suspension of our contract to build and operate an 1800-person camp, where an extension of our initial 2-year tenancy contract is under negotiation. Given the escalation in hostilities in the area in recent days, the directors of the Company now expect there will be further delays in the project that are likely to impact on the overall financial performance of the Company in the current financial year. This impact is expected, at the current time, to be up to USD 10m of revenue"
Very unloved, good quality share here: lost in all the market noise of commodities and “pent up demand”.
But wait...
RAI will post passable numbers for 2021 and there’ll be RNSs on contract wins yet to come. I suspect they may win work from energy and commodity players who are getting their pitchforks dusted off.
I wouldn’t be the least surprised to come back here in autumn 2022 to find the price much nearer £1.
Canaccord have just issued their first note out on RAI, with a Buy and an 80p target. An initiation of coverage note by a newly appointed house broker will generally be pretty conservative in nature in my experience, allowing for future upgrades. Especially with the 2020 results due in the next couple of months.
I believe there's large upside here given the growing order books. And we may be pleasantly surprised for 2021 with any significan deferrals of work from 2020. In the meantime I'm happy to hold too see the share price reflect the newly forecast 8.3p EPS for next year.
Here's an extract from the new note thanks to Gawain elsewhere:
"Robust cash outlook for 2021E
RA International (RAI) provides specialist facilities and support services in remote locations for international and multilateral clients. Its business is founded on a track record of delivery and integrity in some of the most challenging commercial environments in the world. Since listing in June 2018, its business has changed significantly: it has diversified its operating country exposure, increased its government and commercial customer base, increased the size of contracts it takes on, and has built a significantly stronger pipeline of recurring business. Despite the short-term challenges of COVID-19 on its business, we see the outlook for RAI as highly attractive going into 2021, due a step-change in free cash generation, an increasing share of high-margin recurring services in its earnings mix, and the multiple contract awards secured in 2020. In the short term there remain significant barriers to executing work due to COVID-19 related effects, and we base our valuation on a range that goes from minimal opening up in the short term, through to a top end which sees faster contract progression this year and rapid growth next. We initiate coverage with a BUY and a price target of 80p.
The numbers look like this:
FYE Dec 2019A 2020E 2021E 2022E
Sales (US$M) 69.1 63.4 59.6 87.8
EBITDA (US$M) 17.3 13.9 13.0 21.3
Net Debt (Cash) (US$M) (19) (11) (7) (14)
EPS Adj&Dil (p) 8.0 5.3 3.7 8.3
DPS (p) 1.3 1.6 1.7 1.9
P/E (x) 8.9 13.5 19.5 8.6
EV/EBITDA (x) 6.6 8.2 8.8 5.3"
Hi All.
Ive been a RAI shareholder for a while.
Trying to get my head around the numbers we can expect for the FY as one of my concerns is the stagnation of profit for the last 3 years.
$35m USD revenue for H1 and (at least) $28m for H2 = $63m revenue
Gross profit of 29.1% = $18.33m gross profit vs $13.64m of last year.
Assuming net profit is similar to gross as per last year, can we expect $17m of net profit?
Eg, P/E of 7.2?
Anyone got another view?
Agreed, rivaldo. Virtually all buys as reported too.
It’d be nice if the spread were a bit tighter; I think it might attract a few more into the fold.
I’m in for the long-term here based on my current knowledge.
Looking strong.