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Hi Gavster, I don't think we are anywhere near that run rate. This is still development Gold so incredibly low volumes really until stoping starts. Stoping was not planned until late Q4/Q1 next year from the previous RNS's, the extension of the veins may very well have delayed that so I think we are still some way off. That is where I would like to get an update - when does stoping start ??? Surely it is not too much to ask !! Investors get twitchy when the information coming out is sketchy.
I am not impressed by this. This goes against all what Roland Phelps has been saying and his outlined strategy.
https://www.galantas.com/investors/financial-statements/
As of Three Months Ended March 31, 2019
Cash and cash equivalents $3,767,187
Cash burn of the first quarter was around $3.5m
If the gold is now flowing then surely a fund raiser wouldn't be needed ?
Gold sales needed to balance that kind of cash burn is about 3k to 3.5k ounces , which is supposed to be surpassed now.
I hope it is not that kind of profit hunting by mates who'll sell on a forth-coming announcement.
That has been seen before many times in the small cap market and never goes down well with us PI's.
As you know I am big fan of Galantas and so Visitor I would like to strongly disagree with you, unfortuntaly I cannot because a lot of what you say is correct. This share needs confidence and to get confidence it needs something to work with i.e. forecasts. Gold is booming, lets make the most of it with some really good positive but realistic RNS's. Tell us what the optimisations are of the machinery - what will that mean for increased output when stoping starts, when will stoping start?
We have seen from the video last week that this is a proper mine, not a pie in the sky of most on Aim. That needs to be worked with coupled with the high gold price. Let's hope the next RNS stating that funds have been raised gives a bit more detail and a more upbeat RNS !!
Just when I was thinking of turning my small punt into a more sizeable holding, GAL do another significantly discounted dilutive placing. Becoming a bit mickey mouse after they were confident there would be no such need for further placings after the last one.
The lack of any updated information on estimated commercial production (as nebulous as "late 2019", which is already delayed from earlier estimates) or any idea on the revenue from the concentrate shipments means until there is more transparency and clarity, investors will stay clear even with gold at $1,450+.
Could end up being the punt of the year after this news, if this truly is the last last placing, but there is just too much uncertainty. I hope they sort out the this uncertainty in the next update - the Q2 2019 should be due in Mid August?
Well there is the answer to questions 1 & 2 !!
That answers that one then Gavster - so not much to worry about on that front. The key items for me now are:
1) How long does it take for the company to become cash flow positive - Q3 or Q4?
2) Do we have sufficient cash to last that long?
3) When does stoping commence?
4) At what volumes (Oz's) is the initial stoping?
5) How long is the ramp up period to hit a run rate of 25,000 Oz per year?
6) What is the plan to exceed 25,000 Oz?
7) When will the first really decent / profitable Quarterly update be published - Q1/Q2 next year?
Hi TotalTrader
Good point. I found this piece of news
https://im-mining.com/2018/08/08/galantas-gold-starts-omagh-processing-plant/
which states "The concentrate is then exported, via Belfast port, to a smelter."
I believe trade deals with USA et al would take many years.
But Galantas will be pretty much free of trade troubles in the event of all outcomes.
I agree, no real effect on the actual shipments if they go from NI. I have never asked where the concentrate is shipped from - Gavster do you know it is definitely from NI and not from ROI? If we resort to WTO terms then this may imply an import tariff (not sure on this, I cannot find any data) but it will most likely be very small circa 5% - gold is not something countries are likely to have argued about ! The USA & Canada will be 2 countries we will sign a trade deal with pretty quickly in my view. In terms of currencies one can never predict where we will be in 12-18 months time but at the moment there is a definite currency gain as the £ weakens. The gold price also gives us more $’s so it’s brewing a perfect little storm at the moment. I view anything above $1250/oz for gold and below $1.35 for the £ as a pure benefit as far as profit forecasts are concerned.
For me the MM’s will have to get the share price moving at some point to gather interest and increase volumes, i still think they are sat on over 1m shares from the large sell of a few weeks ago. The way to do this is to spike it up by 50% on release of really good news so it hits the top of the daily charts and thus gathers interest. Whether that happens this year or maybe after a good quarterly result next year is anybodies guess - but it is coming !!
Good discussion. So, having a quick look.
Galantas ships regularly between NI and Canada, listed on Canadian Exchange. Gold generally sells in US Dollars and employs from the local community. Currently all dealings in Canada are under the https://en.wikipedia.org/wiki/Comprehensive_Economic_and_Trade_Agreement between EU and Canada.
Also, on this page https://laws-lois.justice.gc.ca/eng/regulations/sor-91-31/fulltext.html
Suggests there is no import duty on concentrate.
So a hard Brexit. Pound will crash and so value will increase in pounds, stay the same in Canadian, then when NI leaves the UK, this should broadly remain the case.
Remaining in the EU or a free trade deal with the EU, then all should remain the same, except some pound strengthening.
IMO, the amounts of possible duties involved will not impact of the amount of market value increase I expect upon Galantas hitting production and 'life of mine' targets.
Maybe completely wrong and glad to be corrected.
Next quarterly update in a few weeks. This is a BUY at 5p.
How do you guys see Brexit & the likely hard border at NI & Republic of Ireland affecting the Omagh mine operations?
I get the sense investors are waiting to see how this plays out before taking a position in Galantas.
I know what you mean Gavster, in a world in which AIM CEO's are more like marketing people spouting anything to get to the next fundraise, Roland's more genuine, down to earth approach with no fanfare is probably viewed as very pessimistic. A marketing chap would not go a miss but I am happy to keep the costs down for the moment certainly until stoping commences.
It's amazing how PI's will flock to the latest and greatest mining project that's done a bit of exploration drilling, but not to the strong possibility of great growth from a real mine, producing real gold and no wish to dilute share value. Then again after seeing the proactive interviews, I have always thought it could be a good move for Mr Phelps to delegate interviews to Mr Charisma and get some strong PR going. IMO his comment about the high grade was not presented in a measure commonly used or in anyway hit home.
Looking forward to the updates.
Good video - hopefully might make a few people realise there is something going on at Galantas !!
Drone Video:
https://www.youtube.com/watch?v=mscsV4J_X2Y
I was waiting for that one to come out Jupiter - it's always proactive !
I was looking at todays RNS against the one issues on 11th Feb. Just over 700m of access have been added in that time and today we have access on 4 levels. The 1072 level was estimated to go 58m into the vein in the Feb RNS, today 40m are complete. Gold mineralisation is high and in line with - and slightly higher - than previous mineralisation found on the other levels. The mineralisation appears to extend further than is covered in past resource estimates which will be tested at the other levels - in other words, as was always planned, the LOM will expand beyond 6 years - the aim of course is 20 years plus at 50,000Oz per year. To put that into the context of numbers for those not so familiar with mining, that is over $1.3Bn of gold revenues at todays prices.
Looking at where the company is one would hope that stoping will either commence this year or certainly very early into next year. Progress continues - we eagerly await the increase in Oz sold that will drive this SP much higher.
I looked into David myself after DJF's comments, seems he is a very experienced and respected mining engineer. Avocet looks to have failed due to a high debt and a high cost per ounce of gold extracted. Probbaly would be a touch unfair to lay that all at one persons door !! I think the positives are that Galantas are employing key people that will help to optimise the business which bodes well for the future.
Hi Finsletown
Do you see David Cather as good or bad for Galantas ? Why did Avocet fail ?
The irony - David Cather voted in as non-exec director on same day Avocet Mining, which Cather used to run, announces liquidation.
Always difficult to understand why people sell when the companys is just getting going but there are always personal circumstances and the person may have a sub 3p average. What was interesting was that over 1.2m shares were sold at 4.5p but the sp hardly moved lower. Another way of looking at it is that the MM's now have 1.2m shares at 4.5p so that - in all logic - forms the baseline of the sp.
The important aspect now as with all early miners is at what point does the company become cash flow positive? The last placing was to fund working capital through to commercial production - depends what your definition of commercial production is - after development Ore?? - which is scheduled for finish late 2019/early 2020. Until then there will be staedy increases in Oz's per qtr but nothing dramatic but hopefully enough for a positice cashflow !!
Hi TotalTrader
Yes, it's all steady progress. In my opinion the SP is going to be very slow to react to gold production in the coming months, as looking at the trades, there are some large sales. I can only supposes that there are sellers among the holders of the millions of issued shares in recent years, simply getting there money or taking profit, suppressing the price. I'm not normally one to go too analytical on trades, but the lack of overall movement today prompted me to have a look.
The equipment I imagine must be for the improvements of the on site production. Again this is Galantas doing what it says on the tin, so to speak, as improvements will be needed to maintain and improve production to get to 25k Oz annual equivalent as the first target.
Yes. Q3 and Q4 going to plan is going to massively have an effect on the company's balance sheet and fundamentals, and of course the share price.
I expect at some point, GAL will get noticed by investors and these shares will change hands quicker resulting in a good SP rise but I'm not expecting this to happen until the gold sales are hitting us in the face, as it were.
Cheers and GL
The management discussion, which I've just sifted through again, and for example these RNS's here show some likely shares that could be sold into strength as the fundamentals rise.
https://www.galantas.com/investors/management-discussion-and-analysis/
GALANTAS CLOSES PRIVATE PLACEMENT
Fri, 1st Dec 2017 07:00
RNS Number : 0489Y
Galantas Gold Corporation
01 December 2017
GALANTAS CLOSES OVER-SUBSCRIBED PRIVATE PLACEMENT
Fri, 10th Jun 2016 17:50
RNS Number : 9216A
Galantas Gold Corporation
10 June 2016
Too true Gavster - a steady RNS today showing progress. Q2 output forecast to be more than double of Q1 following the second shift sometime early in Q2. It's likely to be higher due to the lag in producing 25T and shipping it. Concentrate grades a little lower than expected but they will be net of the smelter royalty and will improve as the plant efficiencies improve following this initial ramp up perod. Not sure what the specialised flotation items are but it's most likely they are to increase the recovery and increase concentrate grades. Knowing the conservative nature of Gal RNS's I would not be suprised to see that the Q2 numbers will be higher.
The important question to be answered during Q3 & Q4 is how quickly do those concentrate revenues increase?? As per my point above on the lag and on ramping up, the end of quarter run rate will be significantly higher than 160T i.e. the start of Q3 run rate will already be much higher than 160T. But it's all heading in the right direction, no nasty suprises, just steady progress.