The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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The presentation must be going well :-)
ethical - I don't believe you fully understand how mining operations work mate.
The costs are fully explained, completely plausible and associated with the current operation and dealing with Covid management - that is extremely important to understand, it's "TEMPORARY" and the switch to V25 will see costs/oz tumble as the oz/tonne mined, transported and processed increased massively.
It's about the quality of ore, big companies with economies of scale can work low grade small operations need to be nimble with higher grades. H1 results without the background information we have would be very worrisome, knowing what we do the results represent excellent transitional progress - I believe TSG shareholders are not idiots, (most of them) not the normal AIM sheep most companies put up with, there is no sell off and analysts will get their presentation today, with PI's tomorrow at 11am to clear up any concerns. Don't worry yourself.
Probably not fair to compare but as I hold both SHG and TSG I'm going to:
SHG produced 84k ozs at an AISC of $777 and lost $9m and never paid a dividend
TSG you've seen the results so SIZE does not matter its all about the bottom line, making money.
With the low gold production in Q1 2020 and any initial COVID19 mitigation measures, i was expecting some increase to AISC. Perhaps when it's in b&w for some it was unexpected?
The guidance if I remember was always a largish spread of $900 - 1,000 AISC, so they've only missed upper range by $21 and sure with 2H 2020 on track to deliver 21k+ production, they will meet both production and AISC guidance.
Correction on my previous post - meant 7% interim div yield.
“ For 2020, TSG set out to pay a base level of dividends of approximately $3 million.
The Company is pleased to report that the Board has declared an interim 2020 dividend of 8.0 US cents per share equal to approximately $7 million (H1 2019: $2.0 million).
Given the strength of the operational performance and favourable trading environment, the Board is confident in the expected cash generation in H2 2020. Having already exceeded the stated guidance for dividends for FY2020, the Company is reviewing its anticipated financial performance for H2 2020 and will provide further guidance for a revised base case of dividends in due course.”
What's not to like?
20% increase in AISC might have something to do with the drop?
Don’t forget that some traders really do 'Sell on news, buy on rumour'. They'll sell on every RNS regardless of content.
Net Debt is also down to only $8m end of June 2020 from previous $16m.
Announcement of 8% interim div yield at this share price to be paid early Nov, upgraded div guidance going forward and a bumper Q3 2020 due in Oct as they allude to production being in line with Q2 production of 11,419 oz, the response is quite bizarre.
EPS of 10p per share for half-year, interim dividend of around 6p per share (ex-div 9/10), Q3 on track... and the share price stumbles on open.
AIM never ceases to amaze!
In an era of Covid this is a very good performance.
The dividend is IMO to send a sign to shareholders that all is good and the results were as expected and most importantly they have genuine belief the H2 and 2021 will be much better, V25 should improve things dramatically.
Steady RNS IMO, shows they can be trusted to deliver as per plans.
Interim dividend of $7 million resulting in payment of $0.08 per share (H1 2019: $2.0 million resulting in payment of $0.023 per share)
· Largest single dividend payment made to date in the Company's history; total capital returned to shareholders $40m
Looks like full year production will come in towards the top end of guidance :-)
"Operational performance in Q3 2020 has been in line with Q2 2020 during which it produced 11,419 oz. of gold with an average feed grade of 7.57 g/t.
· Gold prices have remained very favourable with an all-time record spot price of $2,067.15 recorded on 6 August 2020"
Great RNS!
Upgraded dividend guidance for the full year to be announced shortly
This is what we know.see below ..... However costs have been dramatically reduced due to exchange rates and low low oil prices ..
Q2 Production & Operations Update
Trans-Siberian Gold plc (TSG.LN), a low cost, high grade gold producer in Russia, announces its production update at the Asacha Gold Mine for the three months ended 30 June 2020 ("Q2" or the "Period") and the first six months of 2020 ("H1").
Q2 Highlights
· Total gold doré production rose by 66.5% QoQ to 11,419 oz (Q1 2020: 6,859 oz)
· Average gold grade 46.9% higher QoQ at 7.6 g/t (Q1 2020: 5.2 g/t)
· Average realised gold price increased by 8.7% QoQ to $1,738/oz (Q1 2020: $1,599/oz)
· Total gold sales rose by 94.6% QoQ to 11,357 oz (Q1 2020: 5,847 oz)
· Gold revenue increased by 111.5% QoQ to $19.7 million (Q1 2020: $9.3 million)
unquote .... fools gold? I think not
From my recollection the spread was massive in the early, say less than 20p, days. As the SP has risen, and as more shares have become available for public trading, the spread has narrowed considerably. I'm inclined to think that there might have been 4p spreads at 20p, and that spread has continued all the way up to £1+, albeit with variations down to 1 p. So spread 20%, narrowing to 1%..
The spread is very variable sometimes 1p sometimes 4p
If the advertised spread is say 4p often the real spread when you want to buy/sell is in reality a bit less.
TGS is best suited to LTH , short term buying or selling only works if there has been a significant price movement (to absorb the wide spread).
By leaving it until the last day of Q3 they can give a good insight into the first 9 months and any projections will in essence be dependent only on the last 3 months - with 9 months revenue and profit already secured.
For a $100/oz fall in the gold price which hasn't even persisted for 1 week the SP fall is crazy.
With potentially exceptional results coming next Tuesday (just my guess) anyone not buying or topping up at current prices needs his head examining
More likely to go to £1.40 than 40p - some are being silly.
Under pressure "yes" and may go lower but on the basis of what is known there is no justification - news is imminent, then we'll see the direction of travel.
Vein 25 has grades than are extra-ordinarily high and the gold price has been within striking distance of all time highs during the period and jet we are supposed to think going back to near multi-year is likely. I'm a buyer at current prices (bought yesterday ) and will buy significantly more if we fall much further - all depends on the update in the next few days.
I've already started to increase my position ... will keeping adding back another 5000 shares every time the price drops another 5p. This approach let me reduce my average to 65p at the beginning of the year, before trimming my holding as the price rose above 90p. Hoping for an exact repeat over the next few months. Can see next to no reason why this won't be back above 100p when the next set of results get announced
40p very unlikely here i'd guess.. but I've got to admit I'm now reaching the stage of moving from very surprised to shocked by this fall... however, I intend keeping the -medium term - faith readily still here and indeed will start to incrementally add more here into any further weakness from 75p down.. hopefully it doesn't go below 75p of course ( 80p my b/e here and I like averaging down as a trading style too, granted)
PS: i have no idea why there's a big seller dumping here now, but would offer that the potential fires issue offered below should, if any merit in it, have seen an RNS from the company acknowledging this issue/potential issue. As there hasn't been one I feel there no merit in that angle.
I moved into cash yesterday morning and will be back into gold shares plus maybe Covid, when I feel the market settles - tough to call as always
Totally agree with people jumping out of certain stocks and gold to liberate cash.
That was my plan during 2019 but tired of waiting for the crash and invested hastily only to see everything rollercoaster and my watch list prices double between March and August.
I might look to free up some cash but only to invest in here if we drop some more, as I missed averaging down previously.
Patience, as always.
There is no reason to assume TSG has been adversely impacted by wild fires - put it into perspective Siberia is huge 13.1 sq km bigger than the US or Canada (second largest country in world). Reports fires suggest approaching 3m acres on fire as we approach winter weather, so less than 0.1% not great but no reason to be concerned unless they company RNS's some impact.
5 working days left to the end of the month so update imminent and we'll find out what's going on, in the meantime the general market turmoil hurts the SP as investors need to liberate cash - happened at the start of the C19 before gold and gold miners where recognised as an edge against plunging asset values.