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Please have a go at Bitcoin's EV using similar metrics or even something entirely new.
If you can then I'll give your evaluation of Centamin some validity.
I’m not a gold expert/analyst by any means but…..Gold is currently at 1750 oz. In recent years it has dipped under 1300 oz every year. If it heads that way soon, which I’m assuming it will, what price will CEY shares (probably) be? 80p?
I Was looking towards 1.50 not so long ago, now anyone's guess where from here
Why does £1 feel so distant now
October 19th is direction reverse day (unless the price of Gold turns beforehand)
Surly not much lower to go, could do with some positive news from Hogan
Nothing "fishy" Rebess , their legal system ,like Spain is different.
The original ruling was an embarrassment to that court, so its dec was not legal. IMHO.
So has been lost in old history.
Most of those judges are probably dead so in reallity is their decision .
Thanks Tibbs
You have a good filing system. :-)
That was 7years ago and still no ruling - Why? - Something fishy .
Thank you Mr Tibbles, most LTH understand fully ,but now many newbies do not do sufficient research as they have interest only in the SP.
Which is short sighted.
I am sure you eill have to repeat your clear answer again in the future.
Enjoy your weekend.
Hi Mr Gnome,
Possibly you or Cowichan may care to start such a thread ?
Court Case lost documents Siko posted 20. 11 .2013
I have just had a long discussion with Mr-Egypt's lawyer who attended the cc today and I asked him many questions.
These are the details of today's session which lasted for 45 minutes:
-This new court is formed of 8 judges, 3 from the old court -which ruled on 20th March to postpone the original ruling- and 5 new judges including the main judge, who seemed to be a very fair man.
-The first thing the judge did was to ask Alfakrany why he was suing everyone?! Also the judge told Alfakrany not to talk after realizing that he was not a lawyer, and especially after Alfakrany did not stand up as the judges entered the room and the judge ordered him to stand up.
-The judge asked Alfakrany's lawyer to explain the whole case as it was new to him. The lawyer explained all about the agreement and its conditions, then the judge asked what the problem was, Alfakrany's lawyer said that according to the agreement if CEY worked outside the agreed area or submitted any forged documents then the government could cancel the agreement, the judge asked (what did they do wrong and what forged documents did they submit?) , the lawyer said that their entitlement was for 3 sq km only, but they worked outside that area, and that was a clear breach of the agreement, and later they got the minister to sign a contract for that area!
-Then the ministry of petroleum's lawyer intervened and said that the whole case was a total waste of everybody's time, including the court, and said that the administrative court was not even entitled to consider the case at the first place because the agreement was a law approved by the parliament, and confirmed to the judge that all the correct legal documents were submitted in the file, including the agreement and the contract. The judge tried to find the contract in the file, but it was too big and could not find it straight away, so the lawyer told him that he will submit another certified copy on behalf of the ministry of petroleum, as the one in the file was submitted by CEY & EMRA. (This is the first time the ministry of petroleum gets involved).
-Alfakrany then tried to talk about the unfair conditions, wasting public natural resources and stealing the gold, the judge told him (This is an administrative court which only considers whether the contract is legal or not, and will not consider anything else. This is a documents only court and lawyers sometimes do not even get the chance to talk because the court only considers documents).
-I asked Mr-Egypt's lawyer about his feeling about the cc, he said that he felt very positive after today's events.
-I asked him about the final ruling and when to expect it. He expects another adjournment on the 25/3/2014, and then on that following one it could be booked for the final ruling (so 1,2, then final ruling), and he guesses about 6-7 months from now it should be all done (This is all his guessing)
The enterprise value of Centamin with all its dollars in the bank, resources priced at $40 an ounce (inferred priced at zero), Reserves after depletion for 2021 at $150$ an ounce as its a fully functional mine equates to just over 89p. Of course the long term free cash flow per ounce Gold price minus AISC is well over $150 after all taxes and profit share. A functional mining operation should be trading greater than in the ground price and what it has as cash in the bank. The FCF model minus decommissioning costs should value Centamin at around 121p at $1800 gold price. The company will update Sukari reserves and resources in Q4 and hopefully this will replace ore mined out over the past two year and increase the in ground enterprise value and the FCF minus decommissions model. A much higher gold price in future does give a higher CEY value. A question for the company for somebody to raise is what gold price does the company regard as economic to mine. It was $1300 per ounce years ago and they could to add to others they are compiling. Tony
Thank you Torndotony,
This just about sums up the bulls(hit) my previous Tory MP replied back to me with when I challenged the UK governments decision although found unlawful in two lower courts finally supported by a Law Lords appeal ruling that it was lawful to change the terms & conditions of the public sector pensions scheme from RPI to CPI, although this doesn't apply to MP's pensions who receive a full pension if they have held a seat twice (10 years or less) no 40 years for them!
My present Tory MP is a lazy sycophantic Bentley driving stinker who lives 130 miles away from his constituency and never replies to any correspondence or returns phone calls unless you are agreeing with or praising him on social media, any comments of criticism are taken down, so nothing from him on the subject!
Most governments stuff us one way or the other but the Tories really are the worst, especially this shower of corrupt lying shysters!
Someone asked about valuing a Mining Company....what a subject!, many a good person has been embarassed at doing this. Have a look at the plethora of disasterous acquisitions...Some do it very well
But simply I see it as having a rational component and an emotional/irrational exuberance component.
The RATIONAL side is relatively simple, and here are few linkages.
https://corporatefinanceinstitute.com/resources/knowledge/valuation/mining-asset-valuation-techniques/
https://microcap.co/how-to-value-a-mining-company-part-i-gold/
IN short you calculate all of the future cash flows bought forward by assume a future interest rate(!?), and we have some more interesting assumptions for long life mines like, foreign exchange, metal price, tax stability, costs (etc), but you can load them all into a well structured spreadsheet, and get some degree of comfort?
The IRRATIONAL part, is that value due to exploration success, and market exuberance/emotions. This is where there are wide variations, very poor constraints and lots of emotions, bravado and stupiditiy mixed with incompetence.
Rio buying ALCAN for $38b
Barricks (Gold) takeover of Equinox (Copper) for $8b ?!
Kinross Gold $7b acquistion of Red Back Minng (bought 2010, almost 100% written down 2014!)
and so on, the cupboard is well stocked...
1. Exploration success is a function of
a. endowment of the earth.
b. being able to find the commercial parts of the mineral endowment quickly. This depends on the type of orebody (for example if it is magnetic, then you can use magnetic surveys, and these are fast, cheap, easy to do) and you can get very fast results. An example of this would be Iron Oxide Gold Deposits, like Olympic Dam, in South Australia. Because these deposits have a distinct magnetic and gravity signature, the mining company found 12 deposits in 3 years within 26,000 km2. It also depends on the type of technology, and the ability of the exploration management and team to deploy the exploration technology correctly (right tool in wrong hands syndrome)
Then we have the madness and emotion buried in the market place, the dodgy shorters, the longers, the lemmings and the maddening surge of masses of exuberant rumours, inuendo and exagerated market response to surprise news (good or bad, and maybe some can remember the poseidon nickel boom in Australia...If you cant, here is a quick look
https://en.wikipedia.org/wiki/Poseidon_bubble
Then you also have the "players" like Robert Friedland, and its worth revisiting the Voisey Bay sale, Basically sold for $4.3b without any mine financed and built. ... back in the days when a dollar was worth a lot more than now!!!! (1995 - need $1.80 now to purchse same $1 value)
https://www.visualcapitalist.com/the-story-of-voiseys-bay-the-discovery-1-of-3/?utm_source=Visual+Capitalist+Infographics
prob does not help?
the gnome
https://corporatefinanceinstitute.com/resources/knowledge/valuation/mining-
CI
I got an email from CEY, from the Corporate Communications mManager. Try
Alexandra@centaminplc.com
Which thread would be more appropriate to post your questions on in regard to Centamin?
cheers
the gnome
· A key milestone under the terms of the Sukari Concession ... government was ratified into Egyptian Law no. 222 of 1994,.
https://www.reuters.com/article/centamin-results-idUKL4N0QK2LC20140814
https://www.reuters.com/article/centamin-egypt-idUKL4N0OU3JB20140616
Hi,
The original accusations were made brought against EMRA Centamins partner by a disgruntled politician (Al Fakerani), now a convicted felon in exile who has admitted they nothing more than lies and innuendo made for his own political purposes.
The Egyptian government has never threatened to withdrew Centamins licence, that was a judges decision at the initial hearing based on since admitted false accusations by former politician since convicted of corruption.
There was never any ploy by the Egyptian government to get more profit share.
The original Sukari licence is enshrined in Egyptian law 222
The court case is stuck in limbo awaiting a final ruling (caused by SCC considering Law 32)
https://www.egyptindependent.com/centamin-case-allegations-golden-contract-gone-bad/
https://www.mining.com/centamin-legal-fight-over-gold-mine-in-egypt-set-to-end-this-year-88030/
https://www.sharesmagazine.co.uk/news/shares/centamin-eyes-end-of-legal-pains/
https://dailynewsegypt.com/2013/01/27/prosecution-wants-al-fakharany/
https://www.egyptindependent.com/former-mp-fakharany-s-trial-begins-over-embezzlement-charges/
https://egyptindependent.com/fakhrani-sentenced-four-years-fined-le100000/
https://english.ahram.org.eg/NewsContentP/1/173035/Egypt/Egyptian-anticorruption-activist-sentenced-to-four.aspx
Possibly a delay due to number of enquiries received?
I'm accumulating although I know next week is probably not good. But eventually we should start to creep up. I accumulated few months ago from 113 to 101 and sold for 117/120. I started again from 113 to 89. If it goes down again I will buy more and start selling from 100 upwards. Once I have made up enough profit, half is left in cey long term and the other invested in crypto
Patryk. As you raised the initial question about why profits haven't increased this year despite Gold prices having risen from $1300 to $1800 since 2013 , the following is relevant to explain the comparable decline in profits . There will be other items in the equation too.
1. There has been 8 years of inflation in mining costs since 2013, so the gold price had to increase to pay for that.. If you add 8 years of inflation since 2013 to get a real comparison with gold then the real increase would be much less than $500
2. You need to factor in real increases to costs of sustaining the mining operations. these tend to increase over time as it becomes that bit harder to reach the next tranches of gold
3. More items are being added in to sustaining of the mining costs due to increases in regulation regarding mining safety and environmental reparation.
4. Real increases in costs arising within Corporate admin due again in part to increased admin burdens , , one example is implementing staff diversity , equality , training etc . lately they have upgraded accomodation for employees...all of these are new costs against the same gold prices and none of them produce an extra ounce of gold , apart from at the margins maybe
Ken ..Centamins share price was only 35p in 2013 because the Egyptian government gave notice that they were going to withdraw Centamins licence to mine for gold ..you can't make profits if you can't mine gold ..naturally it was a ploy by the government to extract more favourable shares of profits. It did get resolved but only after a 2 year battle ...just see how much the share price rose after settlement was reached. .
A couple of comments were raised about dividend payments. .these are a distribution of profits not a charge against them , so they won't in themselves affect profits...they will though have a natural eroding effect on share prices , because dividends represent the returning of capital to shareholders , rather than retaining it in the business for future expansion
Mr T....you mention asking questions to the Board of Centamin ..I sent in 3 questions which is all I, myself needed to know about Centamins outlook ..I haven't had a reply
I will post what those 3 questions were on a more appropriate thread .
As always DYOR ..Good luck .
Mr Elang . Under different circumstances that would be a good idea ..the benefits are that it allows a capital reduction to take place at a reduced cost whilst also propping up the share price by mopping up distressed share sells. Also the effect will be to increase EPS and make the same dividend payments per share at less cost , which will leave more funds available for exploration , but in the future ...
The main downside is that £300 million in the bank , whilst being able to buy back 30% of the outstanding shares leaves no further cash for exploration in the present ..good question though.
I presented a number of questions to the investor relations team , but unsurprisingly no reply , despite a reminder yesterday ..not even an acknowledgement . Statements saying they are committed to being open with retail investors are just words . Words are cheap . Actions are what count ..and there is none .
Spot on Tony.
Mr Tibbles and our readers out there,
The attached article is 7 years old but highly relevant. They are treating the public like mugs and read off the same script of transitory inflation.
https://www.forbes.com/sites/perianneboring/2014/02/03/if-you-want-to-know-the-real-rate-of-inflation-dont-bother-with-the-cpi/?sh=32d75345200b
Inflation is about as transitory as FED committee members not trading shares on their inside knowledge. I do not know what it is like for everyone else, but inflation looks fairly hot to me and it feels like its around 9-10% here in the UK and if you go in any building society you read the notice that interest on accounts is declining to 0.15%. I wonder if those in charge think everyone is an idiot and can not count. The chances of it cooling off might partially happen, but 2% next year is a made up low figure.
Last year it was all about climate change and oil companies were out. Now they say its great to own oil stocks and climate change is all BS as its to difficult to figure out.
Stay well everybody and enjoy the weekend whatever you do.
Looking at your posts here sir I cannot understand why you do not sell, you are a trader trapped maybe ?
Do not answer.
Yes that is true but if they are as confident as what MH is implying why not do both with production being forecast to increase - cash flow increases so surely they could seriously consider this or are we just going to see the can kicked further down the road