Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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The bond status is still "planned", the last news was that placing/bookbuilding would start in October.
Normally you would expect the PR machine to be turned up to max. including RNSs advertising each step in the bond issue timetable. But this is Altyn, so I would not be surprised if day one of the bond placing starts without any RNS.
Although the Moscow bond market is open, some parts of the country have recently shutdown to slow the spread of the virus. Russia have a low level of vaccination and are now suffering a renewed rise in their reported death rates.
https://graphics.reuters.com/world-coronavirus-tracker-and-maps/countries-and-territories/russia/
If the Russian bond placing is going to happen in October then an RNS is due this week, surely! Or have I missed something?
Back in April I suggested this was a bit of a gambler's stock and I rated the probability of several scenarios to give a fair value of 0.09 x 0p + 0.25 x 150p + 0.33 x £3 + 0.33 x £5 = 275p. These past few quarters have been consistent and quiet which suits me find. Our 2021 revenue will probably be around $48m from 28k oz production so I think the chances of us going bust have almost disappeared and chances of growth towards that 100k oz production aspiration which they had a few years ago is becoming more likely but still distant. So my revised fair value is now 0.33 x 150p + 0.33 x £2.50 + 0.33 x £4.50 = 283p ... not much different, but I feel much more confident that we will get our re-rating to atleast £2.50 even if gold sticks around $1750 and the company just announces 8k oz production in Q4 .... I'm staying overweight !
There seems to be a slight change of sentiment in recent days around gold stocks - gold has been somewhat out of favour for the last few months, but gold stocks in general have underperformed gold.
In the last couple of weeks now gold has been treading water at around the $1750 mark, however GDX (the ETF tracking gold majors) is around 8% of the lows it hit at the end of September and GDXJ (the ETF tracking large junior gold miners) is up around 10%.
With gold I generally like to follow Jordan Roy Byrne who has been pretty good with his forecasts over the last couple of years especially in predicting this consolidation with retests of $1750 or even $1680 which has come to pass. One of his predictions is also that sentiment will return to the miners first and then to gold and that this will coincide with the stock market getting toppy and the next leg up in gold will follow when the stock market begins to correct - all this so far seems to playing out pretty well.
Computer generated or perhaps they use a variant of 'pin the tail on the donkey'!
ALthough not so long ago the SP was approaching £3 and we were 'probably' thinking £5 was to follow and dreaming of £10. At some point investors will hopefully start to take Altyn seriously again and the SP will be £13.99 or more. I'm not sure what the trigger point will be.
Might get there someday! Think the fair value based on ebitda should be greater than £1.39 - not sure what they are at. Computer generated I think.
Already surpassed last year's turnover in 3 quarters
Turnover Q1 to Q3 2021 $35.6M
Turnover full year 2020 $30.0M
"Fair value £13.99 according to simply wallstreet "
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Presumably a typo, £1.39 according to the market reaction today.
I wouldn't complain if it did get to £14....oops sorry, £13.99.
Fair value £13.99 according to simply wallstreet https://simplywall.st/stocks/gb/materials/lse-altn/altyngold-shares
Improved gold grades & quantity , whats not to like here
Debt versus equity!...IF they could find an equity investor then I guess that would be OK. As you say the controlling family is probably a negative for some investors but I suspect they will always have over 50% regardless.
Feeling very positive about next year (famous last words!!).
9,500 oz last quarter is 'probably' a bridge too far!!....but not impossible (assuming they identify & resolve the bottleneck).
Well hopefully now a decent trading update is out, the company can close the note issuance they are clearly planning which will provide the funds needs for the large CAPEX they have in the plans next year - that would then reduce the concern that a large equity issuance is coming.
Although I wouldn't rule out an equity issuance alongside the note issuance, but equally given the low free float here, its not impossible it can be done at the SP or even at a premium and reducing more equity which would reduce the percent of the company that the family holds, would also actually be a positive.
Spike, I think you have analysed things quite nicely. There seems to be some sort of bottleneck with the processing plant that needs addressing and/or explaining. Yet again they mined more than they processed and they already have approx 100,000 tonnes of unprocessed ore piled up 'somewhere'.
They are making some good sounds but not all the instruments in the band are playing the same tune. Hopefully only minor 'tweaks' are required but we might have to wait to the further investment to unblock the as yet unspecified bottleneck.
But overall a good update....hard to see why the market isn't taking notice! Perhaps the additional investment will also answer a question mark over ALtyn & make the company more attractive to fund managers & the like.
Good continued progress, slightly lower than I thought it might be and now they will need to achieve 9,500oz in Q4 to achieve the 30,000oz target they put in the most recent presentation, however that is also the quarterly rate they need to achieve to hit the targets in 2022 so potentially its possible.
Good to see grades continuing to improve, that really has been a success this year.
Main open question for me is what is the actual processing capacity of the plant - nameplate is 850koz, but they still have fallen short of processing everything mined - it could be a timing thing, but the do have inventory from last year that is still awaiting processing.
Another record quarter. Market will have to take notice of Altyn some time soon. Hopefully this week!!! GLA
The exact communique: "In relation to your question - if a new processing plant is required it will be built to serve the prospective site at Teren-Sai in the future after an assessement is made once production commences."
Hopefully that puts an end to this nonsense!
PS: The question was.."Where is the new processing plant going to be built?"
100% agree.
Thanks Bald_eagle, the current investor presentation was in my view pretty clear that there remain plans for just one new plant and that was now being planned at Teren Sai.
As I say what’s important now though is fully utilizing the one they have.
Spike, just to confirm that you are correct in your understanding of the plan to build one new processing plant and the location....as confirmed by Rajinder Basra to me yesterday.
Stonefold, that's very good thinking. Take the mountain to Mohammad!
But no, the new processing plant will be located at.....(under the current plan)
Will they build one new plant but put it on roller skates so they can wheel it between Seki and TS?
As Spike wisely pointed out, it's all a bit academic where they build the next processing plant. The most important thing is that they are seen to have a workable plan...namely to upgrade Sekisovkoye from 850ktpa to 1Mtpa over the next 3 years and then commence construction of the new plant at....
Are they going to cover east Kaz with hundreds of processing plants?
Got an answer from the company....took some time as I was warned it would.
Drum roll....and the answer is....
Sorry that is a repeat of my 9:13 post which vanished but seems to have now reappeared.