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I think that’s realistic Andrew, you just cannot see it being a couple of months, with drilling required. Also I’m not certain what he means.
In Zak’s podcast he seemed clearer that the high grade component will have an infill programme to increase the higher recoveries to 5,6 or 7years done before the resource model is finished.
With kev and Phil he mentions the high grade component at 4-6 years recovery, but then I get an impression that it will be extended further to 8 years ‘after’ the model has been done, saying that might send us into an infill programme that will extend recoveries from 4-6years to 8 years.
It may have been due to editing, not sure. What do others make of the comments?
High grade component with Zak @3min40
https://podcasts.google.com?feed=aHR0cHM6Ly9hdWRpb2Jvb20uY29tL2NoYW5uZWxzLzUwNTExMzMucnNz&episode=dGFnOmF1ZGlvYm9vbS5jb20sMjAyMi0wNS0zMTovcG9zdHMvODA5MjcxNg%3D%3D
High grade component with kev and Phil @1min40
https://podcasts.google.com?feed=aHR0cHM6Ly9hdWRpb2Jvb20uY29tL2NoYW5uZWxzLzUwNjQ0MzcucnNz&episode=dGFnOmF1ZGlvYm9vbS5jb20sMjAyMi0wNi0wNzovcG9zdHMvODA5Njk4NA%3D%3D
Colin was clear about a couple of holes being needed to fill in a hole in the model that will be drilled before the conceptual pit will be finished, which is not to be confused with the high grade drilling.
At Ascot he mentions finding out what’s below the gold and also what’s above it so no doubts a very minimum of two holes there, which I think he suggested. Then of course, not forgetting Footrot
I'm also happy for CB to explore other anomalies . But as CB says, its a big system so I'm also not too sure how we will be doing a lot more drilling + assay at the other anomalies in just an extra 2 months?
Ben's comment about "year" is probably more accurate . Be it early next year or 12 months from now.
Maybe CB is so sure FB income will be available by July, or Aug latest, that he wants to make good use of it? I would be amazed if we get a buy out this year now. Q1 earliest now IMHO.
On a separate but related matter. I just dont understand why some are selling, just before FB will go into production. RNS could land tomorrow or end of month (latest?). SP will surely be up to 6p minimum, on that news?? Possible over 7p?? circa 10p on first income confirmed?
I guess we'll know soon - very soon probably.
As you say very much guesswork with timelines. We've been saying for 2 years on here about the potential of footrot though and I'm very excited to see what it has. Is it more like Racecourse or more like Ascot. Very intriguing. There's lots to come of the next year or so in Oz, Zambia and Mozambique.
CB said we were not 'late' but there may be a delay of a couple of months. Not sure I understand the logic: being late with a good reason is still late. That said I was trying to work out whether 2 months would be long enough for what needs to be done. I suggest some timescales for certain tasks below. This is real finger in the air stuff with the intention of getting people with more knowledge to comment and give us a better timeline.
So I think we should estimate 8 weeks after drilling is completed to get the last assay results.
The approvals for the drill locations might be handled concurrently but may take still take 8 weeks say minus 3 weeks because they have probably put the requests in a few weeks ago. (I wonder whether this is actually true for Footrot.)
I assume we only have two drilling rigs and we can only do half of the ascot frilling and probably none of the Footrot drilling before getting the new approvals, so as a guess we might need say four weeks of drilling at Ascot after approvals, then four weeks more at Footrot. (I suspect two holes in Footrot will not be enough because they may well miss at mineralisation on the first go.)
So that suggests to me a probable earliest timescale we could complete the planned tasks is:
Approvals of new drilling sites at Ascot and Footrot: 5 weeks
Drilling Ascot say 4 weeks drilling after approvals.
Drilling footrot 4 weeks more (need the drills)
Complete assay results 8 weeks after the last Footrot drilling.
So in total 5+4+4+8 weeks = (approx) 5 months.
Any improvements on this or better way of calculating the probable timescale? Thanks!
Lucky and James
You both obviously have a better accountant than me:)
More than happy if we do get a brucie bonus tax reduction!
I'm expecting an RNS today or tomorrow to confirm that our money printing machine has been switched on. Any conflicting expectations?
Best,
Mr T
Depends on how far back they can go. When was manica acquired and how much losses have we made since then. Uk I thinks 7 years.
Hi Andrew
Fully agree on including tax in the calculation, i am calculating taxes the same way as you to be conservative and for simplicity.
However in reality I would imagine that they would be amortising the value of the manica license as they produce (I think they paid circa $10m from memory) which should give a nice bit of relief against CIT.
Cheers
James
Steve
Understood.
I didnt think you were but didnt want anyone to be disappointed if they thought it likely Q1 figures would continue the upwards trend and be better.
Of course, I could be wrong and they may be better :)
Lucky
You say lots of losses, and I know CB has mentioned this, but I dont think these loses will significantly affect profit. May be a bit more profit.
Last recorded losses were 90K a year. I would think the monthly profit may increase a by £10K a month, at the most.
@Andrew4444
Yes, agree on Q1 being lower for alluvials due to the rainy season and also the likely CB update strategy. I wasn't trying to create a false impression - just showing that income is growing over time rather than steady.
Andrew, don't forget we have lots of losses over the years to offset some tax.
Steve
I agree that we are ramping up small HR production, and GF and BE figures may be better than Q4s, but Q1 for alluvial production, is always the lowest of the 4 quarters (rains), so I would be amazed if we still see the steady increase in income next release that we have seen all of the last 12 months.
I would think Q1would be less than $1m?? The very lengthy release in figures may also imply a reduction or poor quarter?
Q2 could well be the best ever or very near Q4s figures
I would not be surprised if CB did we he did before and released two quarters very close to each other. Average / poor Q1 followed by very good Q2s. That 3 months gap of news release made into 2 weeks :)
You also need to take off 32% corporation tax (thats the rate in Moz)
So, for alluvials + small HR, thats $1.32M a year = $110K a month = £88K free cash flow a month.
CB said FB will be making same profit in a month as alluvials make in a quarter. That looks a little low to me and by my calcs we will be getting £350K a month from FB FCF. So £400K to £450K a month FCF from all of manica.
Yesterday, CB said we will be getting $600K to $900K a month after expenses and that was from all of manica.
Taking the mid point as $750K a month = £600K a month = £408K a month FCF after expenses AND corporation tax so in the £400K to £450K range.
When CB quotes these figures he understandably is not taking off corp tax which is 32% in Moz, so the headline figures seem better (then what FCF will be).
£450K FCF a month (£400k Min £500K Max) will be transformational. Even if the market doesn't realise it :)
The below is for 12 months but the production is gradually ramping up.
Q1: $144k
Q2: $218k
Q3: $785k
Q4: $1.38m
Also the hard rock only started in Q3 (from the smaller mines, not Fairbride) with 170oz in Q3 and 505oz in Q4. The rest is alluvials. Fairbride will be much larger than the smaller operations such as Guy Fawkes and Boa Esperanza.
All of the above are different parts of the overall Manica operations.
I too get confused!
For me, 1) is being delayed a bit while Ascot (?) is scrutinised further, though there might already be things happening behind the scenes?
2) Waiting for the cash register to start rolling, which will help 1) as you say. Manica does not get much air time, but I get the feeling from here, this is imminent? Just how imminent I do not know, but it will be nice when one starts creating an income.
3 & 4...pass!
We seem to have plenty in the pipeline, once one starts, it might be like a snowball?
Can I just get my 5k a month straight transfer?
We are in the money.
At the weekend I booked a holiday for next year. I pushed the boat out and went for a balcony. I should of made it a suite.
Best,
Mr T
https://twitter.com/EmpressRoyalty_/status/1534645958985887745?t=vmSQGfETUcRwsJPtOB1Xsw&s=19
Cheers for that Millsy, much appreciated. Sounds quite intriguing. Look forward to more info on that!
Good work andy, as always.
Thank you
Thanks millsy, it's been bothering me for ages.
Don't understand why it has not been mentioned regardless of how small it is.
Hi Ben
It's been niggling me too.
I asked a few weeks back and got a response below from Xtract. I think Colin had discussed it at the AGM with some attendees, unfortunately I wasn't at that meeting. I didn't ask about the magnitude of the income but would expect it to be in the segment analysis in the upcoming 2021 annual report.
Question
It would be much appreciated if you can provide any more detail about the copper income, which in recent interviews sounded like it was, from "Chongwe" but it is not clear which Xtract asset this relates to as Chongwe is not on the Xtract website or mentioned in the 2020 annual statement. Grateful if you can provide clarity on this point?
Response
Copper income from Chongwe will continue and we hope will last at least another year. Chongwe was an opportunity where a small project owner asked the company to assist and understand what he had and where we might share benefit if there was any potential. It was more exploratory than a deal, but our findings are fairly positive, which if confirmed, will take us into an ongoing definitive arrangement, which of course will be announced.
This is the 3rd or 4th time that Colin has mentioned Chongwe. As far as I can see, there is nothing on the website and nothing mentioned in RNSs about this mine. Anyone any idea where it is? What is the potential? I'm getting a big fed up with the references to something which has never had mention on the website or official statements. Eureka too is so wishy washy as I've said before.
All in all though, I can't complain. Positive and professional interview. Please can someone just blooming ask a follow up question to his waffle about Zambia!
Either sell, move on and buy something safe like UK 10 year gilts or just accept we need to be patient. Colin went as far as could to explain the doubts. It is a rough market at the moment but a good time to bring Fairbride online.