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Spot RBCT coal price is now back where it was before the Ukraine invasion a year ago ...but this sp is still much higher.
Coal price has halved since August '22 so at these prices our net profit is down about 75-80%. Question is how much 2023 production was forward sold in Q3/Q4 last year. It's possible management have locked in a price above $250 p.t for the whole year in which case this drop is irrelevant, or they stayed fully unhedged in which case things could get worse. But FY results for 2022 will be incredible and will get the attention of private investors chasing a quick buck, who don't fully understand the pricing dynamics of this market. You can't report £40m+ annual profit and be valued at £25m so I'm expecting a spike regardless of where spot coal goes in the next month or two.
You'll just have to wait until the scales fall from peoples eyes on this one. People don't understand how profitable these companies are at $170.
There's about $100 per t of clear profit.
And coal was exactly the same price as it is now in January 2022.
… and LAS has dropped too despite the mortgage situation looking much better and a strong London rent market.
Are we saying the recent price drop is a result of RBCT dropping to $166/tonne?
I wonder if a long established company has ever had a 'market cap/half year profit' ratio of less than 1 before?
Bisichi is getting mighty close.
Correction, $174.
This time last year, the price was £174.
China lifted the ban on imports of Australian coal at the end of last week.
I'm certainly not the guru that is tim000, but my understanding is that the balance you are looking for is what they invested during 2022 H1 moving the mining area to a new, more cost efficient and more productive site.
Because of this, mining volume was only a little over half what would otherwise have been extracted, but they have previously said that they expect to make up this shortfall in H2 (such that total 2022 volume is similar to 2021 volume).
Hi Edward - I appreciate the apply. Sorry for the slow response..
I totally agree it feels massively undervalued. I am quite heavily invested in BISI (and did very well on TGA currently out) and considering whether to invest even further.
In terms of my initial question, it was from the numbers in the half yearly report. Specifically in the cash movements there was a cash outflow of £8,680k for cash flows from investing activities. Which appeared to be different form the £4,960k movement in working capital for the operational investment. However there was only an increase in 'other investments measured at fair value' in the BS from £2,721k to £6,418k. Which I was guessing could be equity investments. I don't tend to read ADVFN so might have a look back there but, that was where the numbers came from for the question :)
We’ll let’s hope it all comes good for Bisichi share holders sooner rather than later!
Sorry, Beza...
Hi Bezi. Yes, tim000 is knowledgeable without compare (and hugely invested in this). His only reference to the c. £4m of equities they have invested in is that 'they haven't shown any great profits yet'.
There is certainly no suggestion that there has been bad news on those investments. If there had been, they would have had to have made note of them in the interims.
Reading back through his posts, it is reminder that the incredible H1 results were in spite of a massively impaired production volume in H1. The expectation is for that volume to have doubled in H2.
Morning. I think the poster in question goes by the name of Tim00. He posts some very informative messages both on here and on ADVFN and seems pretty knowledgeable. I think he mentioned the investments.
People do say all sorts of ridiculous things, Beza. But if it was true, it would have to have been mentioned and reflected in their accounts. Surely you know this?
Look at the 2021 accounts, or the 2022 H1 accounts. Nothing
Beza - don't know why you feel you've missed the boat with TGA (sure it has risen from under £2) but it has 50% upside just to return to previous high and a near guaranteed £3 dividend coming this quarter. Since Aug '21 (when I first bought TGA) the sp has gone from £2.50 to £18 and back to £12 ; BISI has gone from 75p to £3.50 and back to £3 ... not so very different, but I do agree that on coal production basis, BISI is still relatively undervalued ... but it needs to pay a dividend to get the attention it deserves
I have a recollection that the guy attended the last AGM and it was brought up there (according to his post) and that the investments had not performed as well as hoped.
Do you use the ADVFN share chat? If you browse through past comments (a few months ago now though) it was mentioned by a regulator poster.
I'd love you to show me where these poor financial investments are in their accounts, Beza?
As far as I can see, it is a coal mine and property investment company, and that's it.
I hold here and LAS. I feel as though I’ve missed the boat with TGA although it still looks cheap, it’s had an incredible rise. I’m hoping the BISI catches it up and pulls LAS up with it.
From another well informed poster of ADVFN I do believe that Bisichi have been making investments (an in house fund type of equity investments) but it performed badly during the period of the previous 12 months. I’ll take of divi of between 30 and 50p. Especially if they grow it the year after too.
I'm not aware of any meaningful equity investments, and if that were the reason, it would have been reflected in the profit.
If you look, pretty much all lines on the P&L moved in good directions, the primary investment was the relocation of the Black Wattle mine to a more productive area.
The near complete lack of communication with the outside world probably doesn't help, but then if you look at Thungela, when they do speak, the press only latch on to the bad news. When Thungela announced they had accumulated £900m of cash on 8th December, the press made no reference to it and headlined a tiny £40m cost of closing a mining area. Have a look.
The lack of market cap and liquidity obviously discourages institutional investors and there is nothing that can really be done about that. This is essentially a 100 year old private company with some external shareholders. In my view, on balance, the resultant stability and commitment is a very good thing.
I'm not sure about dividends. Bisichi is miserly and prefers to retain. Again, Thungela pays a spectacular (50%) dividend, and yet also appears to be condemned for this on the grounds that is it implausible and unsustainable. If they hadn't paid a dividend over the last 18 months, their cash would now exceed market cap. I suspect Bisischi will pay a final of between 30p and 50p (although they could afford an enormous amount more).
For what it is worth, I think Thungela is one of the most spectacular bargains available, and is currently priced as if coal is, and always will, be sub $100.
I think Bisichi is about 3 times more absurdly cheap, and I so I hold a great deal more Bisichi than Thungela.
And lastly London and Associated Properties plc (which owns 42% of Bisichi) is almost identically priced to Bisichi, but has the added bonus of a property portfolio worth a net £40m thrown in for good measure as well. All for a market cap of just £18m.
I take the view that no amount of feeble communication and anti-coal sentiment can deny reality for ever, but in the meantime, the longer these shares remain at these comedy prices, the more I can buy.
Hey all - Quick Question.
The PBT figures here are silly. It does appear that PBT for the full 12 months is going to be in that £45-50m range. However, this was known from the half yearly results.
Just thinking about reasons why the share price didn't hold up at the time. Liquidity will be one. Lack of shareholder distributions to date another I assume? But does anyone know what is going on with the investments made by Bisichi? Cash flow into investments was over £8m but the BS for investments only increased by half this amount... Is this just an equity portfolio which was hit by an bad 2022 investing year, or are they investing in other things?
Cheers
Thanks Beza.
I believe that ex divi date is tomorrow.