Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Https://www.thedefensepost.com/2024/05/02/macron-ukraine-troop-deployment/
No worries H, I really do think it is. I am more concerned at how things on the battle might turn out. The Russians are currently assaulting Chasiv Yar – occupying it would give the Russians easy access to the major towns in Donetsk Oblast. Vadym Skibitskyi, Deputy Head of Defence Intelligence of Ukraine, recently said in an Economist interview that defending Chasiv Yar is proving to be hard. The Russians are throwing everything at the Ukrainians – Su-34 bombers, Su-25 attack jets, FAB-500 glide bombs, loitering munitions like the HESA Shahed 136 and the ZALA Lancet drone, Storm Z and Storm V penal units in so-called 'meat waves', ODAB-1500 thermobaric bombs, paratroopers from the elite 331st Guards Airborne Regiment, incendiary munitions like white phosphorous, armoured convoys of AFV's like the BMD-2 and BMP-2 and APC's like the BTR-80 APC, plus lots of T-72 tanks. The Ukrainians are doing a stellar job holding them off so far, but they are desperately short of men and munitions.
Thanks LL. This mirrors my own analysis- a worst case legal scenario is already priced in.
Howardzzz – Ferrexpo has recorded a provision of $131 million in the chance they do lose the court case. This will be more than to cover any negative outcome from the two legal cases. Ferrexpo would have recorded a profit of $46 million this year, if not for this. Hence, they reported a loss of $85 million instead.
I will leave you with some financial highlights from their report:
• Revenue 48% lower at US$652 million due to lower realisable sales resulting from logistics constraints and a decrease in average iron ore prices (2022: US$1.2 billion).
• Underlying EBITDAA fell to US$130 million at an EBITDA margin of 20%, heavily influenced by operating foreign exchange gains of only US$31 million for 2023 compared to US$339 million in 2022.
• Net cash flows from operations: remain positive at US$101 million despite the significant challenges posed by the war (2022: US$301 million).
• US$131 million effect from provisions to cover possible negative outcome of ongoing legal proceedings results in a loss of US$85 million.
• Capital investment of US$101 million, including sustaining and optimisation projects (2022: US$161 million).
• Net cash position: improved marginally to US$108 million as at 31 December 2023 (2022: US$106 million
@JWBellamy
Yes i do care but people who own this right now know of the current risks, if you wanna provide links to changes in the situations or anything that people don't know that would be productive. Just general scare mongering to try and get people to sell and make your short position more valuable is clearly not productive
Provision in the financial statements is just a non cash thing
Actual settlement of the US$125 mn claim, if that eventually happens, will completely evaporate FXPO’s cash balance
LoungeLizard - thanks for your very interesting contributions.
Can I ask you about the court cases ? Hasn't Ferrexpo already made provisions for any worst-case scenarios (ie losing the cases) and set money aside to cover most if not all possible losses ? So in that case its finances won't be adversely affected if the company loses (which, as you say, is unlikely anyway)?
“You could wake up to an rns saying the plant has been destroyed”
Russia would prefer to appropriate the mines themselves. There is no “plant.” If they do attack, it might cost them too much in terms of material and manpower. Mines are too disparate in terms of targets. Much of the infrastructure is underground. Remember Avdiivka? More Russians died taking Metinvest’s Coke and Chemical Plant than during the
entirety of the ten-year Soviet–Afghan War. A true Pyrric victory.
“You could wake up to an rns saying they have lost their court cases and need to find cash they don’t have”
I am confident they will prevail in the courts.
In terms of cash, they have plenty. Read the annual report, cash is not something they have a lack of.
JW Bell end ..... you could be killed in a car accident or lightning strike.... probably won't happen but we remain hopeful....
In case you were not aware bombing their open cast mine would probably increase production 😕....the court case is aimed at their corrupt russian backing shareholder zhevago... Ukraine are after him and not the company
You don’t care about people potentially losing everything?
Contribute something productive or go away
You could wake up to an rns saying the plant has been destroyed
You could wake up to an rns saying they have lost their court cases and need to find cash they don’t have
Iron ore price jumps nearly 6% over night.
https://tradingeconomics.com/commodity/iron-ore
Personally, I am buying as much as I can OHM. I understand those who feel tentative or anxious. But the court case really isn't anything that Ferrexpo can't handle. In April 2024, Ukraine exported more than 13 million tons of products, surpassing the indicators of February 2022, and thus reaching pre-war volumes once more. These exports were significant: worth $3.3 billion and 1.3 million tons more than in March 2024. The volume was more than Ukraine exported in February 2022.
The growth of exports is helped by:
1) Opening of an alternative sea corridor in the summer of 2023, which allows Ukraine to export, among other things, grain and metal.
2) Ship insurance program, created jointly with the British government and a pool of insurance companies such as Lloyds of London and Marsh. Every voyage is issued $50 million of hull war risk cover and $50 million of protection and indemnity (P&I) insurance.
3) Expansion of the capacity of Solidarity Lines, primarily with Moldova and Romania.
4) Improvement of conditions for transporting goods by rail to the Danube ports.
Okay, there's a lot to break down.
1) The hearing scheduled for yesterday (30th April), may not have happened.
2) A preparatory court hearing scheduled for 12th March 2024 did not take place nor did one scheduled for 9th April 2024.
3) A court of appeal hearing scheduled for 16 April 2024 did not take place, but one is for now scheduled for 14th May.
4) The Supreme Court hearing on 17 April 2024 considered primarily procedural matters, and heard the arguments of both parties. The next Supreme Court hearing is scheduled for 27 May 2024.
5) AGM is 23rd May.
A stock buyback would effectively increase Zhevago’s stake back to a controlling one, something they would most likely want to avoid under the circumstances
Really hope it can get sorted before the AGM to have the highest chance of a dividend.
Do you think they would ever consider a stock buy back with prices so low or would that be pretty unprecedented from a mining company?
These things do get changed, postponed. In which case we probably wouldn't get an RNS.
Time to buy more or is no news on the court case something to be careful about?
Maybe tomorrow
Maybe today.
Are we expecting an RNS update on the legal proceedings today or tomorrow morning?
It's gone quiet on the 30th April legal hearing.
@JWBellamy
'Shareholders are fortunate to still be able to sell above 50p imo'
Is their good fortune your miss fortune?
IMO shorters should be grateful they can still close their positions for less than £1.
There's certainly a heightened risk of total loss but the share price reflects that. Market cap is around £300m which is less than half pre-tax profits not so long ago. The potential gain, if the issues are resolved, is many multiples of the potential loss. I'm happy to hold but not too many!
Did you ever read a book about a canary.