Rainbow Rare Earths Phalaborwa project shaping up to be one of the lowest cost producers globally. Watch the video here.
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In an interview with @TheAfricaReport our CEO Martin Horgan discusses how maintaining financial flexibility is key to achieving Centamin’s growth strategy. #CEY $CEY #growth #strategy #gold #mining
https://twitter.com/CentaminPlc/status/1512392528267460610
Posted on Friday, 8 April 2022 06:00
Egyptian gold-miner Centamin considers debt facilities for acquisitions, says CEO
Centamin, which operates Egypt’s only gold mine, is reviewing its capital structure with a view to creating flexibility for possible acquisitions, CEO Martin Horgan tells The Africa Report.
Setting up credit facilities would allow Centamin to take an “opportunistic” approach to buying assets, Horgan says. The company would be able to bid with a combination of unused debt and shares if a target became available. “It’s far quicker if you have the banking relationships” already in place....
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My Thoughts
The IR person taking over for Alex is keen to increase the # of social media posts - that's great.
However, the Annual Report mentioned the preference of management to 'communicate' with shareholders via 'trusted 3rd parties' - that's not so great IMO
What is the point of signaling intentions thru backdoor channels? New IR person - if you're reading this - shareholders want more direct accountability from the BOD - not another layer of shielding or more avenues of conjecture
Quite so Cowichan and I hope that you will keep continue to hold the company to account via social media!
Trying Tibbs! My latest attempt here:
https://www.linkedin.com/posts/don-lawson-98619370_egyptian-gold-miner-centamin-considers-debt-activity-6918224927737225216-zJU3?
The problem is we want Centamin to grow (I think?) and get out of the one asset risk category - but how can we trust the BOD not to squander more capital on exploration dead-ends?
It is entirely unacceptable to not apprise the market of the latest Batie West happenings - if it has been relinquished as was Napelapara and Wadaradoo - then say it
The dereliction of duties has got to stop - it's to the point of criminality - when material details are hidden from view then brushed under the carpet never to be admitted of spoken of again
It's a shame Mr Horgan has to be the voice for these 'potatoes' sitting on the board when it really isn't his fault - but past decisions and years of mismanagement must be addressed asap - so if the IR dept is reading this - disclose what happened to Batie West - before you go and spend hundreds of millions in borrowed funds
Centamin have said they would be hunting for acquisitions every year since I remember.
Absolutely correct halfpenny, but as we are now aware the problem has been that inept but deceitful mining geologist manager Pardey was incapable or never had any intention of developing such finds and although the BOD authorised over $100,000 expenditure rather than take projects to the next stage they walked away, or just let the licence expire!
So who can really have any confidence in the idea that that are now to seek finance to fund future acquisitions when they may not meet their strict criteria (Whatever that may be,who really knows?)may well be dumped with another write down!
Its no good expecting the funds like Black Rock to question the agenda of the Jersey potatoes heads because Black Rock have no moral conscience,or any integrity and the like of them don't give a sh*t, all they care about is trading the stock up and down as do many other other institutions whose managers and analysts obviously didn't have a clue about the pile of crap that Pardey, and Co had created and the Sukari mine was in danger of disappearing under!
Centamin has been ,and still is to a large extent run by a bunch of "Carpet Bagging" Jersey potato heads who for well over a decade now have been taking advantage of the good nature and trust of their shareholders!
So the comapny is supposedly gong to save $19 million a year from 2023, yet it has just wasted $100 million on Batie West projects and written off $27 million, whilst still sitting on its hands over $30 million of disputed fuel subsidy and still can't be asked to try to resolve an unruled on court case that has resulted in a market uncertainty of tenure of Sukari and a share price discount of over 20% since 2012!
https://www.proactiveinvestors.co.uk/companies/news/90811/centamin-valuation-suspended-by-rfc-ambrian-after-contract-for-sukari-mine-reportedly-declared-void-by-an-egyptian-court-36661.html
https://www.ft.com/content/c9aa1274-229f-11e2-8edf-00144feabdc0
https://www.cityam.com/centamin-soars-hopes-new-egyptian-law-will-end-court-case/
https://www.mining.com/no-end-in-sight-for-centamin-legal-fight-over-gold-mine-in-egypt-56904/
https://www.theguardian.com/business/marketforceslive/2013/may/15/centamin-egypt-gold-miner-positive-update?CMP=gu_com
https://www.centamin.com/media/2529/cent-ar21-full-web-secure.pdf
I fail to see how anyone can claim that the unresolved court case has no or little effect on the share price!
Sorry typo in first paragraph below $100,000 should read $100 million!
Possibly wishful thinking on my part, so angry and dismayed that I still find it hard to comprehend just how much money has been chucked down the lavatory by the Jersey Potato Heads!
At least we're not mining in Russia
Centamin Court Case Share Price Discount
https://www.sharesmagazine.co.uk/news/shares/centamin-eyes-end-of-legal-pains
Gold producer Centamin (CEY) implies a new law in Egypt could result in the dismissal of a legal case questioning its right to operate the Sukari gold mine. Investors understandably like the news, sending the share price up 9.3% to 61.17p. It is very encouraging but this remains a risky stock as the legal matter is not yet concluded and political instability is still a problem.
Centamin has been fighting a court case since October 2012 brought by Hamdy El Fakharany, a lawyer and former Member of Parliament who has had previous success with similar asset ownership challenges in the property space. He has challenged the Egyptian government over the way in which the original licences were awarded for Sukari. This Q&A from Centamin provides further details on the court case.
Today's announcement highlights a new investment law which restricts third parties from challenging contractual agreements between the Egyptian government and investors. The new law appears to apply to both new and respective legal cases. Effectively that should free Centamin of the legal battles that have weighed heavily on its market valuation.
While the signs look good for Centamin, hence the big share price movement today, the matter has not officially been concluded. Nonetheless, analysts remain optimistic.
Stockbroker Numis says: 'While by no means certain this could well squash the legal case and remove the stone around Centamin's neck.' Goldman Sachs comments: 'The overhang on Centamin (regarding the ongoing challenge in relation to the Sukari concession agreement) has been removed. We see today's announcement as a big positive for the stock.'
Westhouse Securities says: 'It is obviously positive news for the company, and reinforces our belief that the company is likely to win its appeal. However, until the challenge is removed we are retaining our 18% discount rate on the stock.'
For context 24 April 2014, 10:33
Yes certainly puts into context the fact that after eight years there is still no ruling by the court, now even allowing for the time it takes to progress cases through the Egyptian legal system and taking into account all that is required is a final ruling doesn't it seem strange that Centamin is still in limbo?
Now why is that?
Remember Sinnerthesaint I wonder if they're still watching progress on this because their suspicions /concerns seem to have been justified?
Agree with you 100% Cowichan, the professional ineptness and the self serving nature of the Jersey Centamin BOD beggars belief and yet they are still trying to cover up over a decade of deception and lying to the shareholders by blaming the former inept senior members of management they appointed and were responsible for by bringing in a new CEO and taking on debt!
Well done and thank you Cowichan,
You are indeed to be applauded for your dogged determination and commitment to getting some honest answers and accountability from the BOD.
Like many other long term Centamn investors for over a decade I have tried to keep the faith as it were in Cenatmin and expected that although the BOD can't get it right all the time and there are ups and downs for the main part the BOD & NED's had integrity, were professionally competent and regarded the best interest of the company share holders as a priority.
In short I was prepared to do the decent thing and give them another chance to put things right, such has been the case since 2016 when the first concerns about how the Sukari operations were being managed were exposed in the financial media.
Although in 2016 the evidence was pretty convincing that things weren't as they should be at Sukari Andrew Pardey denied any knowledge of the said problems and stated all was well, this understandably was accepted by the markets and shareholders who also expected that such a senior company spokesperson and the BOD had integrity and were being truthful!
However it is now apparent that although the BOD and Andrew Pardey weren't being entirely truthful about the state of Sukari, it would and should have been a wake up call and an opportunity for them to rectify the poor mining practice and so bring about a sustainable recovery, albeit at the expense of some guidance reduction in the short term, although this would have been more than compensated for in future years.
However as we share holders are now painfully aware instead of dong the right and prudent thing Andrew Pardey and Youssef El Raghy continued to gloss over the cracks in Sukari operations and carried on with poor mining practice whilst making what they knew to be unrealistic claims of future guidance in the Egyptian and other financial media!
Now were the Jersey BOD & NED's complicit in this deception,or so ignorant of what the true situation was at Sukari that they allowed it to continue until the next wake up call of 2018, whichever it was the recent forced admission's and the near ruination of the Sukari operation with the 60% share price hit makes it apparent they are unfit for such high office in Centamin!
However if that were not damming enough then the wasting of over $100 million on the now to be abandoned West African projects , the recently announced write down of $27 million,a 50% dividend cut and the decisions to now take on debt to acquire new assets must surly be "The straw that broke the camels back", certainty it is as far as I am concerned!
But before anyone suggests me selling out, no I don't see why I should because then they win and I lose, so instead I shall do whatever I can by whatever means to assist Cowichan in bringing to account this unfit for post Jersey BOD!
The recent Investor Meet presentations seemed to be a step in the right direction as far as improving communications with retail share holders, however it seems apparent that they are possibly being used as a form of censorship judging by the number of share holders questions that don't seem to be answered or even acknowledged?
If it is'nt possible for a question to be answered due to FCA or market regulations then at least the question should be acknowledged with the reason why it can't be answered at that time?
I find the investor Meet presentations frustrating because there is no telephone in Q & A session's as in the Webinar presentations to the intuitional analysts , although to be fair considering where the comapny is now must put into question just how much these analyst's really know about the true situation or to what extent are they controlled by their Institutional/Brokerage masters?
It seems that Cowichan's campaigns on social media and Linkedin have had a greater effect and have resulted in getting far more information than any of the webinars so far!
Shareholders need to also ask why are the annual meetings being held in Jersey especially when Centamin now has an office in London and also it was announced in the past that the annuail general meetings would alternate between Jersey and London?
Tibbs where do you get the £100million spend on/at Batie West?
Sorry $100 million.
Hi Dasut, sorry I didn't make it clear but I was referring to Cowichans post of 05th April below
re A New Admission re: License Tenure At Batie
$100 million re Batie West Project, Burkina Faso - portfolio rationalization, exiting Burkina Faso due to internal hurdle rates and license tenure
Above is a quote from Centamin's 2021 Annual Report - it's the first documentation that I've seen where Centamin admits? or refers to the license tenure expiring.
Wonder if this means there will be no asset sale/recoupment of costs at Batie West too?
If so another dereliction of duties by our BOD costing shareholders hundreds of millions in wasted expenses and forfeited gold resources
page 7 here
https://www.centamin.com/media/2529/cent-ar21-full-web-secure.pdf
https://www.linkedin.com/feed/update/urn:li:ugcPost:6916998179066363904?commentUrn=urn%3Ali%3Acomment%3A%28ugcPost%3A6916998179066363904%2C6917144103130464256%29
Cowichan has also noticed some area's of serious potential risk that warrant share holders attention in Craig Murray's 'Risk Review' section of the Centamin report
This "Risk Review" report visually summarizes the opaque and nearly incomprehensible babble these experts have spent the last year prioritizing whilst a decade-long project that has cost many millions of dollar's in Burkina Faso fades into oblivion!
Hope this helps?
According to the 2021 report (p61) the company valued Batie West as an asset on the balance sheet at US$35.2million. It says there is a development and exploitation licence which lawyers tell them is valid until 4 March 2023. However the military coup and an 'inability to correspond with government' has created 'significant uncertainty' in the company's ability to develop or sell the asset before that date. So Batie West has been 'fully impaired' as an asset on the balance sheet. Which means written off right?
3bear,
The write down was reported as $27 million in some of the media although possibly they hadn't realised it was $35.2 million dollars which equates to around £27million
I was referring to Cowichans information which it seems may also include some other losses, or potential losses if existing development projects are also abandoned or written off?
I hope that Cowichan will be good enough to explain his rationale regarding his disclosures and concerns?
If the $35.2 million or £27 million is only for that one abandoned/written off project and other write down's are a possibility or are yet to be announced then this may be what Cowichan is referring to?
You may recall that Dasut also queered the figures so they need clarification or explanation if possible.
Just to say it is interesting that so many here were so annoyed over my posts of the last couple of years saying the price should be lower as it sadly turned out, and more recently have been poo pooing the stock and management while I, going the other way again, posted a turn and buying more last month and have kept accumulating at the end of the tax year to use cgt gains elsewhere, plus a £20k in the isa on Apr 6th so somewhat madly I have put six figures where my mouth is, and am back up to 567k of them, so just hope I am second time right. There could be one more bad result but the market should begin to look forward to steady improvement I hope….!. The THS I originally sold Cey for, and added to at same time which I also posted, have done even better having started sooner and are up 70% since November and up a third since start of Feb and 15% since start of April. Meantime Hoc has also got going, up a third, so time for this laggard to begin methinks. Moreover I am heartened that the management are writing off useless vanity projects in W Africa, I really hope the company sticks to its knitting as the best way of mining management having fun and destroying shareholder value in my book is by aggrandising exploration projects that are holds in the ground. If we want W. Africa diversification we can buy Endeavour, I do hope Cey sticks to Egypt pretty much now.
Tibbs the reason I asked about the expenditure of $100 million is that I understand that there has been a considerable amount of money spent in West Africa but I think it was quite early on that the geologists and their mining consultants determined that Batie West in particular was a complicated ore body. Whilst the mining of refractory ore isn't unusual it does involve complicated processing albeit not unusual. There is an extra risk and if Lycopodium saw it to be complicated and marginal then best out and concentrate on other resources in the initial portfolio namely Doropo where the ore bodies seem on the face of it to be far less risky.
Contrary to what I hear from other people who contribute to this chat I don't see any issue with developing a couple of mines in West Africa. I would prefer they were in Ghana but Ivory Coast would be my second choice over BF and Mali for example.
I like the fact that Ivory Coast isn't land locked and mining companies, contractors and service organisations are experienced in "how it works".
If we were talking Nigeria then I would be one of the contributors saying No to a West African venture but thankfully this isn't the case.
I haven't made a film in either West Africa or Egypt like Sotolo but I have lived and travelled both markets and would be happy to see Centamin develop Doropo and ABC. I also see no problem Centamin funding these projects using Banks, Export Credit Insurance organisations etc like most other companies looking at growth to develop these resources as this will strengthen their credit rating and hopefully their SP.
Hi Dasut,
Thank you for giving us the benefit of your professional experience on the ground n West Africa, I agree entirely that its wise to avoid investing in Nigeria,that said with your past experience on these matters your thoughts on Doropo & ABC etc would seem to make for a sensible business case.
Tibbs I wouldn't say don't invest in Nigeria because done right Nigeria is a very large and interesting market and was actually the company I worked for largest market for many years. Our company having been established over 70 years ago "knows how it works" so whilst extremely challenging can also be very rewarding if managed properly.
Unfortunately I think Centamin would as a new investor struggle to cope with such challenges whereas Ghana and Ivory Coast are better structured and investment follows quite clear procedures similar now in Egypt since the new investment structure.
Experience is crucial when venturing into developing counties and in Ghana and Ivory Coast there are people and organisations who understand the procedures, have worked in the structures and know how to reduce risks and make things happen.
Just a quick note if you go onto the Centamin web site and look at Batie West it clearly states that the exploitation license expired last November so they aren't hiding the fact but unfortunately not answering questions on the impact of the value of the resource, or indeed whether they still have ownership of the resource.
CPI M/M 1.2%, Exp.1.2%
CPI Y/Y 8.5%, Exp. 8.4%
Core CPI M/M 0.3%,Exp. 0.5%
Core CPI Y/Y 6.5%, Exp. 6.6%
Gold near 1975 and cey at 95p...its hard to watch sometime