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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Thanks folks. Sort of what I was thinking but nice to have some reaffirmation.
The added benefit to this arrangement is, as indicated Mardel: there will not be a mad panic to offload shares at an elevated price. Also, we will be left with shares in a mining major and XTR just before what appears to be the start of a metals super cycle. Now we just need RC & Ascot to deliver....
Is likely to be a cash dividend payment or part divi part new shares of the acquiring company. Paid direct into any accounts that shares are held.
Holders would retain all existing Xtract shares after.
Seems to be the most popular opinion
To then take profits, once proceeds are withdrawn from trading account/s and transferred to your linked current account you will then be liable for capital gains tax if shares are held outside of an ISA. SIPPS have withdrawal thresholds where tax then becomes liable
Just wondering what will happen with our shares and how we will take our profits once the agreement to sell BR is in place. I'd imagine that we'd be paid a cash sum for each share held, rather than triggering a mad selling panic to benefit from an increased share-price from the sale of BR. Can anyone shed any light on this?
"If the JORCs for both Racecourse and Ascot come in around the 1.5mt mark after phases 1 & 2, then that is nowhere near a 'gimme' in my book and I will definitely be left feeling misled"
Tbh 1.5mt is probably circa 15p buy-out + 2p min for FB =17p sp ??
If offered 17p now I would take it.
Maybe my expectation of CB have been beaten down over the years, but I would not be surprised at 1.5mt for RC and Ascot and feel that would be in the parameters of the "CB factor"
I wouldn't feel pleased, surprised or annoyed at 1.5mt. Any annoyance I did have would be eased with a £2.5M payout (not profit I should say). Mere bagatelle compared to some declared LTH holdings a few years ago!
Andrew - It seems very reasonable to assume there is substantially more copper/gold to be added to the resource by continuing the exploration of Ascot and other prospects within the EL5574 licence (and beyond). Therefore, if the new JORCs for Racecourse and Ascot fall a little short of the 2mt target after phases 1 & 2, then I certainly won't be feeling misled or disappointed. In fact, I would be more than a little disappointed if XTR were to waste more time and money on a phase 3 if we are essentially close enough to the (arbitrary) target for a 'gimme'... especially when a decision to mine can be used to trigger the buy back clause anyway.
However, if the JORCs for both Racecourse and Ascot come in around the 1.5mt mark after phases 1 & 2, then that is nowhere near a 'gimme' in my book and I will definitely be left feeling misled. And I won't be alone.
Come on CB... put an end to all this niggling and suspicious speculation. Blow the bloody doors off the thing and give us all the best Christmas ever!
"So; based on Bird's Clarification of the 'Misunderstanding' at the AGM are we to now assume the 'imminent' total resource update will show 2MT?"
No. That's not what I understood from his AGM comments.
I think it was more like that there will be at least 2mt at Bushranger but we wont prove it all up just from our drilling. But either it will be shown in time that there is 2mt + (maybe 3mt) from more drilling done by the buyer or we may get attributed value of 2mt if we prove up say 1.7Mt and the buyer will be happy to pay for 2mt as there is a very high chance that there will be way of 2mt or 3mt + at Bushranger after a lot more drilling is done by a major.
Hence Cbs comment about leave some "sweeties in the box" re excellent GeoPhys results and very interesting areas of interests not drilled by us.
So technically CB was right to claim there is definitely 2mt at Bushranger - but he didnt say at the time we would be the company to prove it all up by our drilling.
That's my understanding from what was reported at the AGM
Whatever one's view about CB (and I am as suspicious as anyone else), my understanding (as a relative newcomer) is that the African assets, alone, probably justify the current SP.
So unless CB has been downright dishonest, a disposal of Bushranger should move the SP substantially above where it is now. The lack of interest, at this level, probably owes as much to general nervousness about the global economic outlook as to nervousness about CB.
He does rather seem to come across as the proverbial "liar standing on top of a hole in the ground" however with a lot of fingers in a lot of pies.
Let's hope that, at his age, XTR might prove to be his last great hurrah!
In his defence, JLP's SP has only gone south since he stepped down.
So; based on Bird's Clarification of the 'Misunderstanding' at the AGM are we to now assume the 'imminent' total resource update will show 2MT? - Or will that be a misunderstanding too?
It was fairly recent so he must have known the final figures, let's say with 90% certainty?!
Tnx for the clarification Andrew.
>>I think it was just another ..."Misunderstanding " :) - And why am I not surprised...
i'll admit that my range trading xtr for years now having been plenty fruitful, has helped my view of CB as a cult 'ero develop, Andrew.. and, in fairness, I can understand why - plenty/many - others might take a very different view to me on CB..
Generally, it's all gambling .. and anything can happen in gambling..
Gixxer
I believe he has since qualified that statement (at AGM I think) and said he was talking about all of Bushranger?
So CB's view implied that we may not prove up 2mt with our drilling but the buyer will assume its highly likely there will be 2mt in all the licence.
I think it was just another ..."Misunderstanding " :)
NtM
Well, that's definitely a view some could take. All I can say is that you are a lot more forgiving and understanding than I would be :) I would say your view absolves CB of all blame for any outcome!
Isn't he on camera stating RC has 2Mt and is a T1 asset?
Steve
I agree with you on timescales v resource guidance, but in defence of CB the 2mt comment was an early doors comment so that may have been more in hope that expectation and not based on empirical evidence. So CB doing what he does, but not saying 2mt when he KNEW it wont be.
Its noticeable that 2mt figure has not been mentioned for some time and since the model was being finalised..
I'm sure there are some on this board who would still explain away an 8p buy-out or 1mt as CB just being CB and doing his usual thing of exaggerating so we should not be surprised or even critical of him if those are the outcomes.
I'd be one of those some, Andrew.
Anything can happen 'digging' each and every 'ole(s).. and when early 'oles results are positive, human nature is almost always to get bullish....
You could equally say CB 'misled' on where the Price of Copper was going.. but people can be endlessly wrong on that... it's as nebulous as, for eg, what copper might or might not be found in that next Bushranger 'ole drilled.. etc..
Is she or Isn't she.. showing my age here.
We need some hard facts CB no more speculation thankyou, retail is detail
F100
Andrew >>> The superlatives have been recent ("we have a tier one asset" ), and he must know by now what we really have <<<
A good point, with the earlier 2mt predictions, they were no doubt more speculative without ‘all’ the assay data that wasn’t available at them times. But his very recent statements about a resource at RC of 20x25mtpa (tier 1) are a lot more easily determined and would simply be a direct lie if shown later that the resource was far shorter than 500mt.
Wether 2mt was going to come from RC alone has always been contentious. Colin has not directly said “we will get the 2mt from RC” but, he thinks that…….
I have shown a podcast of cb from july21 dreaming of a resource of 20x20mtpa at copper Eq’s of 0.3-0.35 which clearly shows he had realistic expectations that 2mtCu from RC alone were not in his mind. The early geophys at the time pointed to the extension of RC going all the way down 3km’s and could well have seen 2mt coming from an extended RC. But as we now know that potential extension became Ascot and other out and underlying gold systems.
Hi Andrew - I would consider 1.4mt to be 'well short'. Especially if Ascot is included.
As I said, being over-optimistic with timelines is an easy mistake to make. Over-estimating the scale of the resource is something else and I would question if it was just a mistake.
Steve
Thanks for your thoughts.
I think we all know CB exaggerates and that we should not believe everything he says, but there has to be a tipping point when opinion moves from "results show CB was just exaggeration, so what " to "CB has been deliberately misleading". We all will have a different level of result when this tipping point is reached.
One of your comments did surprise me.
"If we are well short of the 2mt expectation (which CB set), then I would regard that as an act of deliberately misleading shareholders".
Depending by what you mean of "well short", but I think we will be less than 1.5mt, if so, you may be nearing the view that he has been "deliberately mislead" ? I actually would consider 1.4mt as being within CB's usual remit of exaggerating so would not consider that he has been deliberately misleading at say 1.4mt. Maybe that's too forgiving of me or maybe I've been here too long :)
If the buy-out is 10p or even less than CB's "They can stick 10p it if offered" then I consider that being deliberately misleading.
I'm sure there are some on this board who would still explain away an 8p buy-out or 1mt as CB just being CB and doing his usual thing of exaggerating so we should not be surprised or even critical of him if those are the outcomes.
LittleWing - The MM's don't care whether they are taking a commission for a trade at 3p or 20p and don't really create the 'spikes'. The spikes happen when news hits and the AIM herd comes steaming in looking for quick profits. When the buys from the herd start to dwindle, and the profit takers take over, the SP inevitably retraces. Hey-ho.
My outcome hope is simple though... to get a fair price for what has been found. I am as tired and frustrated by the wait as everyone else but it would drive me nuts if we accepted a low ball offer just to relieve the anxiety.
I'm thinking 'Kwakers' isn't expecting an invite to CB's 79th Birthday party ?
Meanwhile, back at the fort, I continue my slow adding shares back exercise to my - now modest- holding here.. a chance this goes under 3p, I get...hence the 'slowly' adding back... but anywhere around the 3p ball park feels like a good buying opportunity to me here and now ..
IMHO & DYOR
@LittleWing Its human nature to look at the share price and think "what does the market know that I don't"?
However, there are two factors to consider:
1) If you have done your research on the complex story here, it is far more likely that you know something the market doesn't, rather than the reverse. After all, achieving that is exactly how to make money in stocks.
2) The low share price is assumed to be based on lots of selling. That simply isn't true. The volumes are minimal and the share price moves down completely out of proportion to trading activity. See the screenshots I post most days on Telegram. The MMs only make money through trading so they try to stimulate that trading by moving the price around on minimal volume. The vast majority of shares have remained locked up throughout the recent gradual fall.
Stevemocal... good post. I agree that 10p would be a steal (if we haven't been deceived) which leads to me having to ask what have we missed that makes the current 3p unattractive to buyers ?
Hi Andrew - Having spent the last 25 years managing projects, programmes and portfolios, I know all too well that most people have tendency to over optimism when it comes to timelines, costs and benefits. CB definitely falls into that camp.
Timelines are the easiest part of a project to get wrong because a slippage in one workstream can seriously knock the rest of the delivery plan off course. For example, receiving assay results back a few weeks later than expected could result in having to rebook the hiring of drill rigs or the commissioning of work to model the open pit and economics... and that could lead to a knock on delay of months. So I forgive the missed timelines (through gritted teeth!).
Would I forgive CB overstating the potential scale/value of the resource? Probably not so easily because there is far less guess work involved. He will have been watching the team in Oz building their model as the results came in and would be privy to the 'running total' that they no doubt have. If we are well short of the 2mt expectation (which CB set), then I would regard that as an act of deliberately misleading shareholders.
But there is a difference between over-optimism and being deliberately misleading. I know CB is guilty of the first but I doubt he is guilty of the second. Besides, I have been doing my own crude modelling as result come in, which I use as a 'check' against what CB says. I think we have 1.5+mt at RC and Ascot will ultimately tack Bushranger crashing through the 2mt target. Can we prove at this stage... probably not. Do we need to prove it to get a decent price... probably not. I still believe, based on the known fundamentals, that 10p would be an absolute steal.
It may well not, just be the economics that will be a deciding factor for AA but their own internal politics and where their jurisdictional strategy lies.
Two possible scenarios, firstly there was an original suggestion of “not to be surprised to see phase 2 finished by increasing the IRR of up to 8 yrs at Rc.” As this is now ‘not’ being done to make the economics as strong as possible, but there is adequate data to trigger the buy back to potentially get a no from AA as xtr may already have a good indication that they will not take up their option for these internal political reasons above.
Secondly, although there is sufficient data to trigger the buy back mechanism there is an understanding that the current economics, due to the limited IRR will not satisfy AA’s due diligence process and are not likely to proceed with buying back in. Leaving the project open to the global market as there is a belief that a greater sale price can be achieved.
Just based on the limited IRR being put forward and from steve4077 notes from AGM that perception is to get a ‘No’ from Anglo.