Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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$206 million loan facility that is free from any equity backing when you already have well over $100 million in the bank and are generating $6 million per month net profit? What could you possibly be spending that sort of money on? Totalled up they probably have over $330 million available to spend, but on what?
Current SP reveals quite a lot. End of year results will be published next month. Net cash position of $85 million as of Aug 2017. Generating $3.7 million per month net profit with average $28 per barrel export price. If we assume $50 average oil price since, we can guess a $5 million per month net profit. If we assume they haven't drilled anything (production has fallen), that is 8 months at $5 million including April 2017, producing a cash balance of $125 million. Current $270 million market cap minus cash leaves a company valuation of $145 million. That is P/E of 2.4 and 2P/EV of $0.28. That is for a company without debt and advanced infrastructure. Note the piece of sh*t that is Premier Oil has a P/E of 35 and Tullow Oil 25. It is amazing what the absence of corporate governance can do for a valuation.
Yes, there are many interesting articles. There isn't any evidence that the Khotins actually exist, or if they do, that they are anything other than employed stooges who act as cover for the real owner. Exillon management are interconnected to the those who hold the majors shareholding, some suggesting one of those in a senior position is actually the real major shareholder themselves. The fact that Urga bank holds all the companies cash and is in itself a fraud (owned by Khotin) , one has to wonder what on earth the FSA are doing. This is a slam dunk fraud case. There is no corporate governance and no independent oversight. How this is allowed to even have a premium listing is beyond me.
Thanks a lot Gambier - I'll take a careful look shortly....just on my way out at the mo'.
I can refer you to the Moscow Post. Open in google chrome so you can translate articles into English. It scans documents into articles demonstrating evidence for their claims. Interestingly, there is not a single picture of Khotin and nobody has ever met him. This is strange for one of the supposed richest men in Russia, many suggest he doesn't actually exist. His bank (which exillon holds its entire cash holdings) is in serious trouble , making catastrophic losses. The articles explain how the scam is probably operating.
Ah!, I see it here..... http://www.4-traders.com/EXILLON-ENERGY-PLC-5821906/company/
Yes, a steep drop indeed. I was wondering under which shareholding name is the Khotin holding showing, or am I barking up the wrong tree? Thanks
Production not moved from December, so no sign of the promised drilling campaign. Interesting week of Khotin articles, including one that suggests Khotin is merely a front for a well known Belarusian politician. SP drops precipitously.
Noticed Bank Ugra (Khotin controlled bank) is even more trouble with Russian banking authorities. Losing a credit licence because of undisclosed irregularities. Stories across the Russian media that the bank is a total (Khotin Led) fraud. It is a shame that Khotin has put the whole EXI cash reserves into his own dodgy bank. Looks like another Ferrexpo situation where the company loses all its cash reserves in a dissolved bank owned by the major shareholder. Appalling failure in corporate governece and further evidence of a toothless FSA.
Maybe IC could have brought out an article beginning 2016 when EXI was at 65p and was in the same position as it now. Many of us bought then without an error riddled IC prompt. Just saying.
Wow, there's no satisfying some folk. What's the big groaning moan - you would still have a profit if you'd picked up at the 20th Jan mag price of 155p. As it happened mine of that same date cost 149.7p For me, I'm just sailing on and readying up to be back in there again. Very pleased with the good IC article and the reminder that EXI are still there and pumping.
That's not quite what the article recommended though was it. And if you happened to read the article a week later you would be down. Chance is not a particularly reliable investment strategy really.
Well, the IC's reminder did good for me - turning £2990 Jan 20 into £3745 and out yesterday. It was very much a repeat of many such good times at EXI, although in the somewhat distant past.
Well, investing in a company based on an IC article riddled with errors is one way of losing money.
Well in the absence of any other news I'd still say the Investors Chronicle has helped drive the shares higher. That and the low free float. Shame it couldn't hold on to 194p high paid and since dropped back a bit
The IC article didn't provide any analysis , in fact it contained a litany of errors regards to production figures and net cash position. It merely offered a change in 'sentiment' without any serious metric analysis or comparative valuations. There is very little interest the in 25% free float, four figures sum temporarily distort the price Need to see the net back per barrel for 2H 2016 to see how profitable they are. Then see what type of drilling campaign is being offered up. Once they are known then you can make projected P/E . A very significant drilling schedule will help to rebuild production rates and net profit but also help convert the abnormally large 2P preserves to the unusually small 1P reserves.
I thought the shares were rising on the bullish investors chronicle article from last week?
Unlikely, neither of the two major shareholders have anywhere near the money to buyout the rest of the share issue. According to Russian newspapers they buy on credit hoping for a turnaround. Nearly all the Russian listed stocks have jumped, so maybe some positioning by small funds wanting exposure to Russia. The free float is now only 25% with the other 75% not selling a single share for years. Liquidity is very poor with this stock hence the movement on very low volumes.
Or a possible resumption of the takeover which never transpired about few years ago.
SP rising with no new news apart from declining production. Very small volumes with reasonably large spreads. Possible reasons: 1) Oil price stable at mid fifties. 2) Possibilty of removal of oil related sanctions leading to an inflow of investment and technology 3) Possible drilling campaign increasing production rate 5) Net back per barrel vs 2P reserves. At $34 dollars a barrel produced an annualised net profit of $50 million dollars. At $55 would probably be $75 million dollars. Returning to previous production highs would produce a net profit of over $100 million dollars. There are over 500 million barrels to develop at these return rates. 6) Over $100 million cash reserves that with the currently extremely low Russian cost base would be sufficient to get production to 30k bpd
SP up again
Down again.
150p appears to be the market apppetite for EXI. A rough projection for 2017 with an average $55 oil price and no increase in production, would produce a P/E of 3 (f you minus £100 million cash reserves from current market cap). This is compared to a Russian average of 8 or 400p. It is amazing what the absence of corporate governance and lack of FSA action can do to a share price.
Says the man who invested in Xcite Energy and lost a packet. Keep it coming, I enjoy this sort of stuff.