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Anyone know when we shoukd expect drill results on zone 2 and 3?
Hoping this gets the party started pre next quarterly production figures
More good news from China. President Xi promising massive infrastructure spend to boost China's economy. Should underpin or boost the demand and price of zinc.
Patience. Market Cap is £204m with 20.2m options to be exercised at 30p and 40p. My guess is that each WEEK revenue is c. $4.3m, after tax profit of c. $1.12m (£863k) and free cash generation of over £1m (depreciation higher than CAPEX).
Don't think this will be fully reflected in the SP until this cash generation is being returned to shareholders, POZ remains above $3,200 (quite a gap ATM) and the risk from PRC is perceived to be less.
what the hell is keeping the sp so low?
With the upcoming AGM and 2021 results announcement I thought I'd look at the last few reports (my first purchase was on 3rd October 2008).
From the Chairman's 2020 results statement:-
As the Company has grown and generated cash, inevitably various opinions have been voiced in relation to the share price, share buybacks, dividends and even the realisation of the value of the Company. It is enough to say that your board continues to evaluate all these options on an ongoing and meticulous basis and remains committed to ensuring that the views of all the shareholders are considered and, where possible, acted upon, a course of action that Solomon himself, with all his wisdom, would find difficult.
With the past behind us, I look forward to the next year of this incredible journey;
From my guess as to where we might be:-
H1 2021 revenue of $54m will be beaten in H1 2022 if the zinc price stays above $3,800. This is based on the exceptional amount of gold recovered in Q1 and the note of zinc sales to date giving me encouragement that not mining has been spent exploring the most beneficial areas to mine;
H1 PAT of $13-$16m. This guess depends on c. 320,000 tonnes being mined in Q2 and the COS returning to historical cost/tonne mined + 12% inflation and admin costs being minimal during Q1;
PAT of $52 - $63m if an annual run rate of 1.375m tonnes pa is mined in H2 and current prices are maintained. I know this is below the minimum target of 1.500m tonnes but the new licence is yet to be operational;
A full year at 1.5m tonnes at current commodity prices would give a minimum PAT of $82m, fully diluted eps of 43c;
with c.174m shares in issue a dividend of 1p per share would only cost $2.3m;
I could go on but I thought GFM to be a fantastic investment (whilst noting the perennial threat from PRC) with zinc at $2,900 so looking forward to brilliant statements over the next three weeks. As the Chairman has often stated that mining is a fixed cost business the price of zinc substantially above $4,000 x more than 1,000 tonnes a week being sold my guesses above could turn out to be substantially exceeded.
Yes it looks good but it seems very difficult to get past this point on the share price, but I am hopeful.
I've been estimating revenue for Q2 in my head this weekend. Following this RNS I've completely underestimated. 4,000 tonnes of zinc sold already on Q2. 1,474 ounces of gold produced in Q1. Amazing.
Agree, very encouraging figures. Hoperfully the forward looking statement on the 5th May at the AGM will give us a better view of what's not only ahead but also of whe higher prices oalready drawn.
Given the stoppage, they are not bad, at least it is all systems go. They don’t give much away, I would have thought they could have mentioned record zinc prices as a positive! It should be a belter for the next 9 months, just have to be patient.
Hi sage.
Good to see you on here. Oh the good old iii days hey.
I wouldn't be surprised to see an offer in the next year or two either. It'll be disappointing if that offer is not at least £3 given the faith shown over 16 years (10 years for me)
Hi, I have been in GFM for 16 years and used to post on iii until it was closed. I have read a number of your posts regarding future cash flow and agree that GFM is a debt free cash cow. Following the license, increased production and commodity prices north of where they were in 2018 results next year should be stellar. It follows that the sp should be north of previous highs. The bigger question though is whether Roger and co will sell or pay dividends. The age of the bod (especially Roger) could be very important in the coming months. Time will tell.
Hi Skop. Thank you for your thoughts. I took my thinking from this interview with Roger. He is discussing the 2021 HY results. Roger mentions that smelter charges had reduced from 40% in 2020 to 23%, or even lower, in 2021.
https://www.commodity-tv.com/play/griffin-mining-excellent-interim-financial-results-increasing-zinc-production-over-next-18-months/
At current POZ I think we'd achieve Q2 revenues of c.$49m which is close to the $54m in the whole of H1 2021.
I think you have overestimated smelting costs. At their worst they were $750/tonne, but fell to around 450/500 for GFM during the last reporting period. Hard to tell where they are now, but guess GFM is currently getting more like 3600/3700 per tonne. On a rolling 12 months, with $35m revenue contribution from precious metals, revenues should be heading towards $200m barring further setbacks. So circa 20p pretax EPS. I stand by my previous estimate of 175p for GFM given China discount,but really with the $18 BN metals in the ground, mining heading towards 1.5 m tonnes/year and robust commodity prices this should be (but isn't) valued at around 250p.
https://uk.news.yahoo.com/zinc-smelters-win-big-fee-112537479.html
Quick maths:-
Weekly zinc sales 900 tonnes x $3,225 ($4,300 less smelting charges) = $2.9m. That's over $900k more than a year ago- EVERY WEEK.
With the expectation that recurring production should be 36% higher than previously then revenue could be approaching $1.0m more than that calculation EVERY WEEK.
Both are fetching high prices still. Their recent post has attracted investors. '' Griffin Mining Limited ("Griffin" or the "Company") is pleased to announce that underground operations have now recommenced at the Caijiaying Mine and that the mill facilities are scheduled to recommence processing ore on 25th March 2022. Griffin Mining Limited owns and operates through its 88.8% owned Joint Venture in China the Caijiaying Zinc Gold Mine, a profitable mine producing zinc, gold, silver, and lead metals in concentrates. ''
At long last the share price is starting to move, about time too. I just don’t understand why the market suddenly wakes up to the zinc price and the growth prospects. This should motor at this share price.
116 paid there
A lot less than it will be soon when investors wake up to how much cash GFM will be making from zinc at this level.
Guys. What's the mkt cap of GFM ...?
All looks lovely to me. With digging started in the new zone, rolling 12 month production should approach the 1.5 million tonne mark. Zinc at 4,000, gold at 2,000 - it is a money machine. Pretty certain cash flow will support a divi for 2022/23 plus expect another buyback programme. I think the broker price target of 150 reflects financial year, not rolling 12 months from now. Got to be worth 175. However, I did sell a bit of GFM at 120 last time ( still holding 125,000) and have just bought POLY at 130: worth at least 700 just on Kazakhstan assets and free cash. Divi in May 40% yield - think it will be paid but may be cancelled if a cash flow crisis
Hi Skop............ Fed up waiting for GFM to come good. What do you think ? Start reducing ?
10 and 20 day both have a long way to go, but we've now had three straight days of rises. Coming home?
bad time is over a pound , nice