RE: Capital Markets Day19 Jun 2024 13:45
My take on Capital Markets Day
Nesis said main objective to completely de-risk from all connections with Russia, hence building POX plant in Kaz will be a top priority. Plant fully comes on board in 2028 and cost $1bn. It will not only process ore mined by POLY but will take on work from other miners in the area so will add to company bottom line. It will also save on costs incurred to ship ore to POX facility in Russia which currently is about $85 per ounce.
Further, the company said commissioning of Ertis POX in Kaz has enabled POLY to gain exemptions from OFAC sanctions.
Company to pursue growth through both exploration and M&A and commodity focus to expand to include base metals including copper, zinc, lead, tin and tungsten. Main geographical area will remain Central Asia, but company will also explore Arabian Peninsula…mainly Oman and Saudi Arabia. Now this was not remotely on company radar prior to Omanis coming on board as major shareholders, and I don’t believe it will ever happen either, albeit Nesis did say the company have requested geological data to establish any feasibility.
Company finances are looking sound with cash in bank at $700m and net cash position of $230m; this is as at 1st May, hence it should be even more healthier by now given gold prices going through the roof.
Nesis said the company currently have no dividend policy. He said divi payments will commence in 2029, though he did not rule out paying it sooner. IMO divis will commence once company registers on the LSE sometime in 2026, subject to buoyant gold prices. By this time, the company should have enough cash to meet all CAPEX to 2028, interest rates would be a bit lower and it will have firmly re-established links/credibility with international capital markets.
Regards listing on LSE, Nesis said there is nothing stopping the company listing on LSE now, but that the company is not ready due to compliance issues which he did not elaborate on. I find this odd cos he did say last year that POLY will stay in compliance with all existing LSE rules eg. corporate governance, shareholder rights etc.
Lastly, I noticed Nesis joined the meeting from somewhere remote for his own reasons and looking a bit dejected. The Chairman Mr Omani said very little and absolutely nothing of substance. I wonder…is there tensions already brewing in the board room?