focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Wow, Gep75, clone child of Sotolo.
You really are learning de-ramping quickly, almost a month since your creation, and getting quite expert.
Ha ha.
Personally I was afraid that the problem with open pit is not as small as some people wanted to present. After this post result call I must say that there is a real problem, because they will need 3 years to reach maximum production and that is only prediction. Personally I do not believe in promises especially in this case that after 10 years of production and promising they couldn’t reach 500k per year. In worst case, and that is possible, it is questionable if they are going to dig even those 400k in next year, because it is obvious that they are not going to make open pit ready for full production. But this is just my opinion.
This data is actually scary:
Q4 production guidance of circa 60,000-70,000 oz, at an estimated cash cost of US$950-1,050/oz produced and AISC of US$1,450-1,650/oz sold, which includes capital spend of US$30-40 million.
Consequently, free cash flow expectations for Q4 are expected to be largely neutral
If they have problems also with underground water as someone said, than that is one more concern. So we can see that it is not so easy to dig a gold even if we all now that it is somewhere there.
My question is why the price of stock have fall last year to 88GBx? That is so strange as well as this situation now.
As I have sad before if there is no huge insider buying than the share is not chip enough. With 350 millions on the bank account it would be better that they are buying Cey stocks. Why they are not doing that?
Q4 production guidance of circa 60,000-70,000 oz, at an estimated cash cost of US$950-1,050/oz produced and AISC of US$1,450-1,650/oz sold, which includes capital spend of US$30-40 million (a total of US$120-130 million for the year)
·Consequently, free cash flow[7] expectations for Q4 are expected to be largely neutral
Hi Prof!
The Endeavour offer for Centamin was an all share offer. It was something like 1 Centamin share = 0.08 Endeavour shares (approx., from memory).
Back in December / January that was equivalent to a "no premium" cash offer. Not so attractive.
If Endeavour made the same offer today it would be worth about 172p cash equivalent, a 30% premium or so. That would be much more attractive.
Compared to most other gold miners (not just Endeavour), Centamin has simply become a whole lot cheaper over the last few months. Given that Centamin still controls a world class resource, has first mover advantage in Egypt, and has no debts and a huge cash pile, it must be a tempting takeover target to its rivals.
So I'm not sure that Centamin can keep its independence for long. I'm not even sure that it should.
Sotolo, Sorry but I do not believe you too be invested emotionally in anything.
That is not your style . You are too hard nosed, after all this is business , not just games.
Good night to you and all, have a good weekend, we will see what the future has in store very shortly.
Hi Sotolo,
Good to hear from you. Sorry to hear about your double whammy of getting wacked on HOCS as well as CEY. Why do you think it was unfairly pulled down post results? Keen to understand as I may want to invest there rather than CEY with some of the money currently sat on the guidelines.
I share your fear ref price of gold. Imaging where Cey SP would be with gold back at the $1500 level it was earlier in the year. Having said that I expect gold to stay strong and even climb given the extent to which the Government printing presses have been in overdrive across the world. Basic economics says that more money being printed, which is basically what QE is just a posh name for, means that each unit of money is worth less.
It is only a few weeks that I was expecting 250 this year and 300 next. When will I ever learn?
Hope you find a way through with the house.
Best wishes,
Prof
Totally agree Prof, and also would really appreciate the views of mining knowledgable among us, like Dasut etc, but you seem broadly, and somewhat scarily, right as ever like Tiger who mostly sold out around 220 and other friends. Prof, as you know the worries we share about Cey and POG are not willing the share down but, for both of us heavily invested here financially and emotionally, we want reasons why POG and Cey should rise. Given the limited ounces of next years and so higher costs we just hope rising gold will save the day but feels to me we are in a narrow range from which gold could equally turn up or down. Fingers crossed and willing it up as much as I can! About to sign with builder so worrying as not keen to cash Cey in now but... Not a good week as my sale of 20% at 137 ish and move of half of it to Hoc misjudged as Hoc has fallen since its results too, I think unfairly. And my Fres. Only OMI rosy as got sale of them right and gone in on fewer lower. You can always tell when things are bad as I start trading a bit trying to find a way out. I think you were probably wise not to reinvest in Cey today, I too am sitting on the half cash from my sale and was tempted back but not yet, first time I have sat on any cash in years. Have a great weekend lol and let us hope next week is better and that when gold breaks it is up not down, and thanks all for your collective wisdom!
Tiger,
They did indeed fail which would suggest an offer would have to be be higher. Conversely that was based on gold production forecast to be 510-525k for this year. We are now talking about 3 years before even getting to 500k.
Prof
Hi JAdam!
Who knows? Basically, it's what the major shareholders will accept. They may have simply had enough.
Endeavour failed with a nil premium all share merger/takeover bid in January. That bid, if repeated exactly today, would carry about a 30% premium due to the movements since then in the two companies' share prices. That might be enough now.
If so, the board have only got themselves to blame. They tolerated way too much complacency and mismanagement in Egypt.
And as for West Africa, who really knows what they have been spending so much money on for so long?
Hi Prof!
I share your feelings on this one.
I welcome Martin Hogan and wish him well, but I do wonder if his appointment hasn't come too late to save Centamin as an independent company. It's clear now that the mine was in a far worse state than I ever imagined during the latter days of Pardey's rule and the interregnum. And now the time has come to pay for the lack of stripping, the high-grading, the over-steep pit walls, and indeed the lack of spare parts and whatever else it was that crippled the underground production previously. It beggars belief that Centamin left themselves so little optionality in the pit that they will have to partially rely on low grade stockpiled material this quarter. But that's how it is.
The gold is still there - the orebody is still one of the world's best. But how can Centamin resist a takeover bid now?
Hi Vicmy,
Don't disagree that long term this is likely move up. My nervousness thought is that if we are not returning to 500k production until 2023 then the POG could be a lot lower by then and we would have failed to capitalise on the excellent gold price. Granted, as I mentioned in my other post, POG could also be a lot higher and we benefit from selling more gold then.
Best wishes,
Prof
Hi Razor,
Thanks very much for pointing me to DJRyan's post. I have just read it and it was an excellent summary of the call. Pleased to see he took so much positivity from the call.
Best wishes,
Prof
Thanks Razor, I will take a look.
Prof
ElProfessor djryan777 has some interesting comments re the conference call in his post history worth a look.
Thanks for your post.
Having just listened to yesterday's post results call I felt simultaneously comforted and alarmed.
On the plus side Martin Horgan came across superbly. He is charismatic, knowledgable, challenging what he has been given and asking questions of everything and seems fully in control. He is also clearly focused on cost reduction at Sukari and opening new ventures elsewhere.
The alarming bit is that is seems that Centamin has been failing to strip back adequately in the open pit for years and there is therefore enormous catch up to be done. He talked about a 3 year plan to get back to 500k oz per year which is way worse than I anticipated even after this week's awful forecast for next year. Granted that is stepped so with 400-430k next year we might then see say 450-475 before c 500 in what would be 2023 (assuming that he meant year 3 was back to normal rather than year three was last year to get us back to normal because that would mean 500 oz in 2024). My worry is that gold could be way lower by then (admittedly it could also be way higher).
Has anyone else listened to the call and if so what did you make of it? The link is below if you haven't or you can access it via the investors section on the Centamin website.
https://www.centamin.com/media/2346/centamin-q3-2020-quarterly-report-webcast-21oct2020.mp3
I would be particularly interested in the technical opinions of those of you with extensive mining experience like DASUT.
Best wishes to all,
Prof