Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Paul Metcalfe I think your assessment is accurate and entirely reasonable.
A lot of the changes Horgan has made are transforming the efficiency of sukari but the effect is cumulative and not necessarily noticed overnight. The operation is being improved and brought to standard across the piece. I believe him when he says a safe mine is a well-run mine and Sukari has been one of the safest.
Why is the SP in the bin then? Look at the world. Two wars currently raging with the threat that both could lead to global conflagration, one of them on Sukari's doorstep. Strong possibility of a global recession and debt crises. Also centamin is going to be spending a lot of money in the next 3 years and that adds risk to the company.
I still think it is hugely undervalued at present and topped up yesterday at 81.7 Wish I'd waited a few hours to do so but hey ho, still think it's a good bet.
Bears are always right - in the end.
Re what will it take ?
1) Q4 delivery on guidance with strong production and revenue.
2) A more peaceful world.
3) More doveish central bank rate policies.
4) No global recession.
5) No G7 debt trap doom loop.
Not much to ask is it?
Hi Dasut, if Doropo gets the green light there will be a period when tens of milions of dollars are going out the door and into the ground in West Africa every quarter for no return. So the build phase will be a tricky period I guess...
Cowichan it's been only 12 months since Cey cleared 127500oz in Q3 2022 - not so far away from 130. And Horgan mentions new "flexibility" in the open pit as a result of all the waste stripping - meaning access to better grades is available. I say Q4 production , barring further unforeseen production issues, will be very close to or in excess of 130000oz. You say not. Let's see who's right.
Hi Rebess so while the mill was out of action they could not process ore of course but carried on truck and shovel operation and piled up the "Run of Mine" (ROM) in a heap next to the mill. Since October 1 the mill has been grinding thru this at max capacity so I expect Q4 to be a belter, in excess of 130,000oz. Likewise Q4 revenues with 60,000 of those ounces guaranteed at 1900 whatever happens to the GP, should be good news.
Have they done this?
- pay several million yearly to the bank consortium to secure the $150 million line of credit
Cowicant - they haven't have they? They've just got a rolling credit facility that they will certainly need to develop Doropo. Not costing them millions at all until they draw it down. Excellent work by the management yet again. What a great company this is and what a fantastic world class ore body they have that is being efficiently assessed and efficiently mined for the first time in years. And what fantastic prospects in West Africa. Wow this company is so good.
Hi Steve, I don't see it like that. They presented it as we've got a lot of big bills coming up so we're taking the prudent step of guaranteeing some of our income to make sure we can pay them - whatever happens to the GP. If the gold price rockets to 2400 tomorrow there's no upside limit either. This was a good deal.
So hang on, at the time of the put centamin was bending to the bankers' will unnecessarily and wasting money it didn't need to. And now it turns out to be a very smart move it was all the bankers' judgement and nothing to do with good management at all?
I suppose there is a sort of consistency there... and it does maintain a record of unremitting negativity in all possible circumstances - impressive!
MoreCheese - they have an option to sell 20,000oz per month at $1900 until next July or thereabouts. This hedge cost them US6million and is to guarantee income levels at a time when they are looking at investing several hundred million bucks in solar expansion, grid connection, gravity circuit, waste stripping, eastern desert exploration and building a new goldmine from scratch close to a national park in Cote D'Ivoire.
Perhaps people can now see what an eminently sensible move this was. Even if they get back less than the 6million over the 12 month period the point is that income is guaranteed at a time when many expensive projects are either in hand, nearing completion or about to begin.
I am amazed - all the people on here who were grumbling about the $25 an ounce cost of hedging at $1900 are now on here praising the management for their foresight and prudent husbandry now the GP is 1826. Er hang on...where are those posts?
What a well-run company this is.
The point about grid connection is that whatever energy is available it will be much cheaper and much greener than trucking diesel to sukari and running piston-engined generators off it in 45C.
Yes Tibbs, they will have been getting around $1920+ for most of the quarter. Horgan likes a strong Q3 to give them an easy run to delivery of guidance in Q4. So I'm hoping for some big numbers and an SP booster.
This looks good to me, they've identified inefficiencies in their operation and are looking to streamline and improve. Excellent to know they are right on top of the operational detail, spotting these problems and dealing with them. Think I'll buy some more shares as soon as the market opens on Monday.