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Converting all this to GBP and share price it's roughly 1.05 pence per share at 150k tons , and just over 5 UK pence per share at 450k tons.
This should start to give a healthy uplift to the share price when figures come out supporting this
I see
In y/e 20 figures if you take revenue and then look at cost of sales for the tonnage the cost per ton comes to 13.12 AUD
Looking at the currency for the year ending 20 this puts the BRL cost at between 36.736 and 52.48
So using the mean of those two figures and todays BRL/AUD rate puts it pretty much at 11.00 AUD
The sale price we know is 200 BRL which is 50 AUD
This gives a GP of approx 39.00 AUD per ton
So for 150,000 tons a gross of 5,850,000 AUD approximately
With costs of 3,000,000 AUD this would give an AUD profit of 2,850,000 approximately
I am now invested here as of last week but still keen to get to the correct figures as I am considering adding
I have read many articles in the Brazilian press and many researchers seem to be supporting remineralization and with the size of the market potential it seems like a reasonable investment at this price as the growth curve is looking good.
There is talk of increasing prices this year but we have no information yet but an extra 10% would give 6,600,000 GP and after basic costs 3,600,000 AUD
I dont think we are too far apart
I don’t think they’re using resale centres for anything other than the small bags which will retail much higher per tonne.
should have said common sales price
One other comment - are they still using the resale centres , if so , how does this impact the amount for HMI as I assume there is a 'common' share price for direct sales and also via the resale centres
Confusing here sometimes swingy is the fact that the accounts / RNS are in AUD yet everyone talks in USD , added to that the sales are in BRL - would it be better if your analysis was in AUD , this way there would be a clear reference to the accounts provided by the company and the only variable would be the AUD / BRL exchange rate
Thanks Russel.
Whichway that’s an interesting point. In my experience the admin is normally a subset of the opex. But perhaps that 1 million is the entire OPEX and the estimated 10 dollars per tonne would be referred to as the cost of goods sold. This would actually make more sense. It’s a big hit on my numbers. 2.75 million x 20 = = 55million market cap.
I hold a lot of stocks at one time and this is a very small bet for me - 5k gbp so far - in my AIM p/f and so I'm not ready to focus on this to the extent of looking into the financials at anything beyond a cursurory level here currently .. also, again, that is a nebulous and subjective activity at the best of times on AIM generally anyway, where it's really easy to, altogether, end up very wrong.... so,with apologies, I'll not feedback in detail on your posting on this Swingy.. but fair play for doing such analysis and great that people here are having quality detailed financial analysis discussions here.... and this might have makings of a high quality BB too I feel.
For now, perhaps the only useful thing I can do here is stop 'baiting' you Swingy.. which is boring/no fun for me, but if you're taking it to heart then best I stop anyway.
Yours Sincerely
Russell
PS: AIM is gambling and not Investing imho
Swingy. Where are you accounting for the fixed overheads? I don’t think that is part of the $12 OpEx.
Company guidance has been a 40kt break even figure so (roughly) you need to discount the profit from that tonnage to cover G&A.
On your figures you then get a $2.75m profit - and a valuation that is far in excess of the current MCap as well as an ability to self fund the new projects.
I’m no accountant by the way so happy to be proven wrong!
Glad to amuse but in all seriousness I do take offence when called out as a pie in the sky optimist. So, in the spirt of sharing, here's some figures which I'm happy to break down. Posted by myself whilst discussing valuations:-
"150kt and $25 profit per tonne means $3.75M profit this year. Forget a p:e of 96, let’s use a p:e of 20 and you get a market cap of 75M USD which is 55 million pounds or as share price of 30p. So, for quick maths, take the sales figures total tonnage and divide by 5 and that’s the share price in pence for a p:e of 20."
One number at a time...
150KT - stated target for this coming year
25USD profit per tonne. Sale price 200REAL = 37USD. OPEX around 14USD per tonne currently reducing with volume. At 400KT the stated OPEX forecast was 7USD before the solar plant etc. So I called OPEX 10USD. In my mind this includes wages but not bonuses. Happy to take advice on this point. I figured 300K bonuses worst acceptable case across all staff. thats 2 USD per tonne so OPEX plus bonuses = 12USD. 37 - 12 hence profit per tonne 25USD. I realise you'll quote all sorts of costs and perhaps I could counter with a potential increase in sale price per tonne.
p:e is a variable feast. In my mind, now the product is selling well and the process is so simple we have very little risk for an AIM company. There is potential for huge growth. Low risk, high growth would suggest a health p:e. The p:e based on last years eps would be pointless (minus something) so you have to use forward looking estimates of profit in order to come up with a p:e calculation. So all guesswork from here in. Pick a number any number? Its senseless. where do you start? Lets do some dead reckoning for 5 years time instead. 400KT sales year on year with no debt and 100 years of mine life and a dividend. That's going to generate a high p:e. Forget other companies at 96 - this is AIM and we'd be lucky to see 1/3 of that. I'd hope for a p:e of 35 based on low risk and other projects coming online. So if p:e = 35 is my guess at 400KT in 5 years, what will it be next year with 150KT confirmed sales, a new higher sales target and the usual talk of dividends? I went for 20.
The share price of 30p is a valuation - not a predicted share price.
My personal target is to see the back of BOPD at 9p (sad face) and maybe, just maybe, drop my "boom" at 20p around this time next year.
If you went on the companies published financials you wouldn't have invested a year ago and yet as of today we've seen 130% since then. Likewise, if back then I'd predicted 130% in a year you'd have probably called me optimistic? Perhaps some of that rise has been a correction / recovery. Ultimately, no nobody really knows. There's investors who carefully scrutinise and crunch the numbers. They'll be along for their healthy 15% year on year. When they get here, you can talk sense with them and probably bore the leggings off the village idiot. In the meantime you're stuck with
I'm liking your sense of humour Swingy..best not keep these quality one liners up or I'll get bored 'baiting you' quickly at this rate :-)
Russel, it’s not about me but since you seem intent on baiting me, for the record I’ve never been wrong about this share price, I’ve just been early.
There's some merit in that Swingy post which is nice, and i'd add that you're sarcasm is improving too with the Russell Grant line, so fair play :-)
But my point was and is that your valuations here are fantasy Island ones ( you cherry pick the rose elements here and disregard thorns and you forward predict on what you've cherry picked far too bullishly too.... and that, altogether, adds up to fantasy island stuff... imho )
btw ; I'll not bother looking back on the uber bulls posting predictions over the years here.. but the chart shows this was over 20p a few years back.. were you predicting 1 gbp coming here from 20p down to 2p too.. ot 10 p down to 2p ..etc.. ?
(I've been in 100 plus aimers over the years and I'd estimate that the 'fundamentals valuation' uber bulls have been shamefully wrong 4 out of 5 times and embarassingly wrong in plenty of the remaining 1 out of of 5.. but the tiny amount they have been right on proves anything can indeed happen in this game.. and, in the round, I've fortunately done well in this game , so it's far from all dog stocks I've been involved in, in case you're thinking of firing that one back :-))
Michu, I do valuations and you do price predictions. That’s where we differ. You’re Russel Grant and that’s fine… it’s what you believe.
Looks like a textbook pullback to me; used it as an opportunity to add triple my holding from a tiny base starting on 10 Jan. Almost all spikes tend to flatten...
looking forward to when your sarcasm is half as potent as your share price dreaminess here swingy :-)
HMI need to get some worthwhile news out soon e.g. a letter for investors that shows there s someone with a heartbeat running the company. that would stop the drift in the share price.
Thanks for your detailed insights Michu /YP/Quisad. I feel enlightened and am thrilled that you have decided that after a thorough expert analysis it’s worth investing in this share. Thanks for also explaining the way things work. All these years… who knew?
NicetoMichu
Yes , it's not an easy share to get your head around as you have three currencies being discussed at times and the BRL exchange rate is then reflected in the AUD accounts.
I think also the resale centres had some effect on the revenue per ton in the AUD yearly report as the exchange rate for 2020 does not explain the difference when you use the 200 REAL as the sale price in brazil.
Fine posting here over the w/e and much appreciated all, especially t1995 and chique.. back and forths like that help come up with somewhat realistic expectations as to what the fundmanetals indicate a s/p could get to when..etc..and are far more useful than the uber bull gang focusing on rosiest roses only and disregarding anything that even vageuly resembles a thorn, in a race to see who can come up with the biggest s/p number to make each other feel great... ( and 4 times out of 5 on AIM the bigger the number the wronger their prediction ends up being as a rule, alas )
More generally, some key variables at the core of the fundamanetals make a big difference .. eg unit sales price and/or key cost driver lines and/or accounting standards ..etc.. so even semingly well analysed fundamental based s/p forecasting can often easily be off a lot versus reality, altogether .. especially also including smoke and mirrors management information sharing that AIM co's are famous for..
Also, fundamentals are only one facet of a share price performance .. especially an illiquid share on AIM.. momentum based on sentiment, in either directon, can be a very big driver of s/p.. and active traders getting involved as a share price rises generally sees lots of retraces into any ralling situation towards short term profit taking ..etc..
My overall feeling here is that this business is now heading in a very positive direction, and 5p -6p ish current s/p in that context is a lowly share price by most any definition .. so I'm fine with being on board here around that price and would be thrilled to see this s/p at around 12p later in 2022 and around 20p later in 2023..
No probs - agreed I’ll not be surprised to see them adjust the price. I expect it to be a small increase which will help them keep the 150KT target. These shares are in my pension. I’d rather see growth than profit. Both would be nice
I do tend to agree swingy. I’m just going off what I’ve heard Brian said in his latest interview about a price rise will be seen in 2022
What if they don’t put up the price per tonne for a couple of years? It would make sales easy. Increase our customer base. Once they’re on board and appreciate that KP F does the job, Harves can price adjust as required. By asking the farmers to switch to KPF we’re asking them to take a risk. The price makes it a worthwhile risk