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17th June 2018-06-17
RE: Diesel fuel case
The subsidised diesel price in Egypt was increased yesterday by 50% ( from 3.65 to 5.50 LE), but this will not affect Centamin as the company has been paying the international price since 2012 and the company currently is not benefiting from any subsidy.
Egypt aims to completely lift the subsidy according to instructions from the IMF, which means the diesel fuel case would be meaningless soon and would only apply to the arrears that Centamin had been asked to pay for the period between 2009-2012, which Centamin is challenging in court.
Yes it seems to be fine now. I'm with Halifax as well. Very strange.
I have posted this previously on several occasions, , but it seems appropriate to remind some and make new members aware of the full facts.
The profit share will be what the profit share will be – the joint venture partner, ie the government, sits in the 50% owned subsidiary Sukari Gold Mines. The management board of this subsidiary has representatives of the government and an equal number from Centamin. All of the investment into the Sukari mine is audited, with Sukari Gold Mines very much being a part of this process. Similarly, all gold sales go through Sukari Gold Mines, where the operating surplus will be divided 50/50 between the government and Centamin, once the original capital has been repaid back to Centamin and its shareholders. The 3% royalty has been paid to the Egyptian Treasury ever since production started (this also goes through SGM).
With the above in mind, there is no issue with regards to the money that has been ploughed into Sukari, particularly the costs of Stage 4 (c.$350m) – this needs to be recouped before any of this operating surplus can be shared. This is not due to kick in until later this year, or possibly in Q1/Q2 next year. It is all a function of the ramp up in production and the gold price.
There is no dispute between Centamin, the Egyptian government and/or EMRA, nor the 50/50 Sukari Gold Mines subsidiary. What you are getting is probably a series of people mouthing off that they want profit share now. This is a political game more than anything, as the deal is the deal (in fact Centamin have advanced the country a few million dollars as a demonstration of their faith in this deal – this will also be recouped out of future operating surpluses due to the government).
What is wonderful is that very few people seem to understand what this 50/50 deal is – it is effectively a 50% tax on free cash flow. In fact the 50% will not kick in until 2016, as in 2015 this will be 45%. To counter this there is no VAT, no corporation tax, no other taxes to pay all beyond the above and the royalty, which on a blended rate compares reasonably well with other 1st world mining jurisdictions (like the US, Australia, Northern Europe etc).
Absolutely agree,
Unbelievable , the UK in the 21rst century and people refuse free vegetable because cant afford to boil them up ?
I appreciate that there will be people who have cut out all but the basic necessities , but how many will claim its too expensive to cook free vegetables but will keep the TV and PC on in every family members room and carry on getting further into debt by paying car leases for all the family,sky and smart phone and all the other subscriptions?
What a mess the UK is in!
Special Resolution 8
Market purchase of ordinary shares
757,153,122 98.73%
9,774,773 453,956
Thanks George
At the risk of being my being shot down in the future!
The opinion of of a very experienced and well respected independent mining analyst who has gained a reputation in the past for their forthrightness and accuracy
The Q3 Report for the three months ended 31 March 2022
This makes for depressing reading.
They really take it on the nose, but it seems management goes all out to improve the long term prospects:
- very high stripping volumes
- replacement of the underground mining contractor, which is very disruptive and requires loads of capex to acquire mining equipment, hire and train staff.
- investments in a solar plant
- exploration to find higher grade resources.
The better open pit grade cannot compensate for the terrible underground grade. Whether the underground grade has anything to do with changing to owner mining is not clear.
If you believe these are all transitory, then this is probably a low point. If you distrust management, then it looks horrible.
*Please note That this isn't in anyway to be taken as financial or trading advice!
Change your online system, quoted but didn't press button and it was instant- just checked my online tracker of buys and sells and flooding through as normal so no idea why you had an issue.
Wow that was difficult to buy. It literally just took me half an hour.
Hi Paul,
Yes, I have been here a long time, like other long term holders I really didn't believe that the BOD could been so inept or have failed to notice, or chose not to admit just what a deep hole of deceit and spoil Pardey & Youssef were digging us into at Sukari!
That's what makes me more angry than anything we were deceived by those that should have have behaved with integrity rather than glossing over the cracks until they couldn't be glossed over any longer, and then they went through the farce of Pardey retiring to take a seat on another BOD and start all over again, because the BOD realised if they kicked his ar(se out the door that would be admitting that they were inept, asleep on the job, or complicit in the deception of the share holders and the market!
Youssef El Raghy ,well, I think we all know why he was in post and I doubt it was because of his in depth knowledge of running a gold mine!
I won't go into details but several of those that gave me what they honestly believed was good info are even more angry than I am.
Please bear in mind I am no gold trading expert, but from what Ive been told Basel 3 is already making a difference, the LBMA and other cartel members are in overdrive suppressing the pog whilst the trying to get out of the paper comex hole they are in, also there's political pressure to suppress the POG to try and make it more difficult for Putin to seen be getting around economic sanctions, but as yet it's in the other exclusive and behind closed wholesale gold markets that the mainstream and the likes of us are excluded from, but the word is that eventually especially with the rising inflation that the effects of Basel 3 will become more apparent to a wider precious metals market
So yes as things stand I'm very inclined agree with our fellow forum members who are bullish about the POG.
I agree with Tornado and others state, if you think about it this share is so cheap?
this year is no doubt going to be the hardest , probably on of the hardest we have ever endured , lets just hope that things will get better, they surely cant get any worse, at least I hope not!
Tornadotony,
They also buy fuel at a government set price which should be a massive benefit over other miners either paying spot or hedged prices. For illustration US diesel price at pump per gallon was $1.98 in 2016 now $5.12 up over 250% !
Special Resolution 8
Market purchase of ordinary shares
757,153,122
98.73%
9,774,773
1.27%
Hi All Please explain if anyone what is special resolution 8 in AGM Thanks
453,956
Just a reminder 4p divi is next week on 19th May
All companies out there are facing higher costs. Nearly all the miners have a total tax bill near 50%. It may be corporate tax, local taxes, VAT specific charges, royalties and like with Centamin they may have to give a share of the asset on top, they may have surcharges when gold prices are elevated beyond a certain level. The margin however is usually 20%-30% to give the real profits. We all know what happened on centamin many years ago with regards to the mine plan. What is key is how the mine plan operates going forward. In that regard Centamin is trading below its book value.
I think they've made it pretty clear that they are not planning any share buybacks. It seems Horgan's view is the best use of capital is investing in improvement of existing mining operations and the development of new ones.
Steve although gold may be up 45% in last 5 years profits are down as costs have gone up by over 60%, plus profit share and royalty now take 52.5% off that reduced profit, so that is why share price is near lowest especially as currently looks like future will be bad as gold price worsens, amazed it has held up so well!
Hello anyone has any idea what AGM Agreed to buy back?
It's not just gold price though- look at my previous post - gold has risen ~45% in last 5years...
walshe investing involves also being patient. the gold price should not be where it is. the market is expecting a lower gold price in the near term. but you need it to give a bit more time. hold it for at least 5 years or wait for a breakout of the POG which will happen. gold is way underpriced
NonCrypto - This was the stock that originally got me into investing. I originally bought in 2018 somewhere around the 100-110 mark before the 220 run and sold that out at around 200ish thinking I was a genius (made a decent but not huge profit). When it dropped to 135 I thought I was a genius again buying the dip (this time with a significantly larger allocation size). I'm now stuck here with an averaged down size of 128.1 and seriously contemplating taking the Bath on it and calling quits.
I have learned many lessons along the way RE: actually valuing a stock other than P/E ratios and how a Gold mine actually operates, what grades are good, what problems can affect SP etc; but the biggest lessons are
"don't mistake brains for a bull market", and "never ever invest in something you do not understand or have done decent Due diligence into even if it looks attractive from basic metrics"
Give the above some thought before throwing your cash at something. Tornado Tonys do not allocate 100% of your portfolio to one asset will come in enormously helpful too, just about 4 years late for me lol
in gold miners is likely mostly due to the fact that central banks fabricate lies which the market still amazingly believe. inflation will become rampant and the gold price will eventually shoot up. thats why im hunting for good cheap gold miners. i never thought they would fall this low. cey seems especially undervalued.
Take the ~4p divi off on XD Date 19th May2022 and should the SP remain around this level CEY will be lower than the lowest price in the last 5 years, April2019 five year low price of ~79p- now @78.7 as I type.
Interesting to note that although gold was @~$1280, in 2018 CEY produced ~472k oz of gold, with an AISC of $884...
CEY has lost ~50% of it's value in the last 5 years, but it's not as bad as that if factor in the amount of dividends paid out...
We all know the history here, lower production since the issues in October2020 and recent inflation causes a perfect storm for the increase is AISC which many investors view as a key component for investment decisions...
Mr T--you have been here a long time and I assume that you are going to stick it out for the golden fip flops? No need for a disclaimer on your reply :-) ----------------How do you think things will go this year? Will basel 3 actually make a difference or will they ignore it or swerve around it?
Do you think that Martin Horgans plans will start to come together this year? I assume that progress must be getting made on that heap and it should get easier the more they shift. Then there are the alloy bodied trucks that were mentioned (Cowichan?) and the solar coming on line.
The trick is getting enough gold out of the ground at a cheap enough price (and I dont mean how it was done previously, that put us in this mess) to make a good profit. Obviously the price of gold comes into it. I was wondering if you think the recent dip in the price of gold is to enable the "stinkers" to buy physical to try and cover some of the paper they have been issuing for years? OR are America trying to make the dollar the thing everyone wants?
Im sitting here , fingers crossed, going to reinvest the dividend again --and hoping that within a few months gold will be moving up to where we would like it to be.
Different note here------Ive heard from a friend in South Wales that the foodbanks there have stopped taking vegetables as people will not cook them due to the increased fuel costs.
Without getting all political------------there is something bloody wrong if people cannot afford to heat their homes or cook food .
Fair comments Tornadotony,
Unfortunately for us Centamin has "tanked" to such an extent over recent years that it will be through the floor soon.
Yesterdays AGM was yet another attempt to represent a bucket full of cold sick as a "Cordon blue meal" and the chairman was as inspiring as "Mr Dead!"
https://www.youtube.com/watch?v=wKBYLjRHa4E
defo an underpriced asset. and what about that sukari mine?
Over $220M in the bank.