The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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How about colin giving us a loan repayable only after a B ushranger sale. The ultimate confidence booster and doubt remover ?
"16 economic pit shells were modelled in the Interim Report from an operating cost perspective only with capital cost requirements excluded and to be finalised on completion of the Study. The 20Mtpa and 25Mtpa open pit options potentially generate significant operating cash margins dependent upon mining rate, copper price and cut-off grade"
I don't think in the real world (where we were hoping to sell on the project) that reads very positively tbh.
If you're buying or selling then the sp is what's important, but my point was that is not what you should look at if you want to gauge the markets view or verdict of an RNS.
The SP is the figure you get when you sell so I'd pay attention to that, the fact that the buys/sells were about even is irrelevant at that point.
the 1.63 u/t trade skewed the closing price. It was circa 15% down.
The fact that one u/t trade can do this makes my point that looking at SP as an indication of market view is not accurate
After an RNS and the SP down 15% (as we were today) many say the market has given its verdict on the RNS.
The SP is controlled by the MMs. There is not some auto algorithm that will ensure the sp is higher with more buys and lower with more sells or level with same number of buys v sells.
There were broadly the same number of buys as sells today and that determines the real market's view of the RNS.
So the market was broadly neutral on that RNS.
We did not have a wall of sells on the opening bell which also indicates the RNS was not bad (or good) imho.
On whole having time to digest RNS with the help of podcast.
More time and patience is called for to BR into cash generator.
Market will always play on this sentiment and test lows. Hopefully todays drop is only down to LTHs can’t wait no more and gives others a chance to get in or some to top up and hold the fort for now.
****E
My take on the RNS is that it is telling us that with the concentrator, the project will be profitable (even if it wasn't so without it) - but there could be a case for dilution. I think that's why the sp has taken a bashing.
However, with regular income I would have thought a loan would be the obvious way forward.
Remember it’s 1.3m cu equivalent not copper
There’s obviously no positive npv or he’d have shown it - hoping for the copper price to bail him out or effectively admitting the game is up at br
The market has this about right at 1.5p unfortunately- no news on full production at manica and what level that is
No point throwing money from there into a hole in the ground at br if it is so marginal
Did they just discover the concept of the concentrator in the last month ? That’s a joke as was the Roast interview- pure waffle
A ‘Racing’ certainty. This is clear both from the RNS and what is laid out in it - and the market reaction.
So the message would be, if you’re on the sidelines, keep your powder dry….
Any of the team want to exercise their 10p options?
On the plus side ( which may or may not outweigh the downside) less bulk pay will require a smaller Capex on equipment, chemicals, labour etc through not processing uneconomical material.
The opposite I'd say, CB said by concentrating the ore there would be as much as an 87% recovery rate so 87% OF 1.3MT is 1.131MT...
Well I picked some up at 1.629 which I thought was a great price but I see others have managed to undercut that. Always difficult to try and pick the bottom. But the way I see it is that with the income and potential they currently have, the current price is somewhat silly. All down to sentiment - me thinks.
Thanks Cygnus7 - we are probably not that far apart in our views, but are just placing different emphasis on point 3.
Good luck with your investments too!
Steve, I don't want to get into a '*** for tat' arguement so this will be my last message on the matter.
It seems that the first two points you make are solved by your own arguement that copper prices are on their way up (if one assumes that the big miners believe likewise). With the way the world is changing it's difficult to imagine that the big miners are not of the same opinion.
On your third point, yes, there are better grades/prospects around the world. No body is argueing that BR is a world beater. But it's already (and will grow) a reasonable amount of Cu without the hassle experienced in other parts of the world. Would seem strange if it get left alone because ... well, can't think of a reason to finish the sentence.
In reality, it looks bad to many because it did not live entirely up to the hype. But that does not mean it's not valuable.
Ultimately we all vote with our wallets.
I hope your strategy works for you.
>> I repeat, there is no way they are agoing to leave 1.3MT+ of copper in the ground in a convenient location in Auss.
Yes, I used to believe that too. However, I eventually came to three conclusions:
1) Unless the copper price is high enough, it isn't economic due to the grades and (as the RNS admits) inferred isn't good enough to effectively plan a mine so more in-fill drilling is needed to raise that to a reserve (exactly what other companies are doing). That needs money from somewhere.
2) Even if the money is available from FB and the drilling is done to raise the JORC status and the copper price hits $5. the majors will still need to be confident that higher price is the 'new normal'. Otherwise, potential price volatility is too much risk for a large investment that requires a high copper price
3) Even if the copper price goes to $5 or $6 (which I think it will ) and looks like staying there (which I also think is true), the majors still have to choose where to invest and XTR is going to be further down the list than potential mines that break even at lower prices.
I decided to invest in options that are potentially higher on that list and also in more general copper stocks.
Any educated guesses on Africa's production income at the moment? I know it is hard with all the crumbs of info we've been fed with but still... Thanks
"Do you seriously think that if the model came back as non-viable, XTR would just release a clear RNS to that effect? Instead, they would prevaricate and obfuscate, like they and many other AIM companies do all the time. Eventually the project will just quietly disappear like Kalengwa, Eureka, etc.. Why do you think there is a new distraction in Zambia?"
Steve: That conclusion does net explain why there's a plan to continue with the modelling and to return to drilling.
I repeat, there is no way they are agoing to leave 1.3MT+ of copper in the ground in a convenient location in Auss.
Thanks 3Card.
Dyslexia rules KO...
Question is, why did LSE pick up on my spelling mistake. Normally it just uses the writers error... unless it thought I was being rude!
Pre concetration scoping seems fair and reasonable path to now take to me.
Generally, I rate Africa Gold at minimum 2p and maximum 5p per share value.. so for this to be 1.65 p as I type is an extremely squared harsh overall company valuation here imho
eg The market is saying that a bunch more money is going to be spent on Bushranger and in the end Bushranger wil be worth zero.. I do not buy that .. and , again, offer a very bad sell on value for bushranger is £10 to £15 m gbp range in my mind.. eg approx 1 p to 1.5 p per share value range .. and with Africa Gold at 2p minimum .. that makes the current share price FAR too low now in my mind.. so I'm happy to just stay patient here.. and/ or top up if this goes under 1.5p..
>> Those who think this is an admission that the prospect is non viable then you need to ask why continue with the f****?
Do you seriously think that if the model came back as non-viable, XTR would just release a clear RNS to that effect? Instead, they would prevaricate and obfuscate, like they and many other AIM companies do all the time. Eventually the project will just quietly disappear like Kalengwa, Eureka, etc.. Why do you think there is a new distraction in Zambia?
At some point, you have to take off the rose-coloured classes and realise what is actually being said in the RNS.
Or alternatively, consider that if you were not currently invested in XTR, is this where you would invest right now? When I asked myself that question last year, I sold and put the money elsewhere. Still very much weighted to copper BTW - I believe that part.
The reason the price is falling is due to the increased delay that this development introduces.
However, for LTH that want to build a position, this is good news. The RNS suggests that this is economically viable but you'll have to wait for your money.