The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Presumably the license referred to below is the mining license since they'll already have an exploration license. Why are Mali not issuing mining licenses? What chance of the money being raised and yet due to political skulduggery (Wagner/Russia?) they still can't get a mining license and thus have to relinquish all their rights acquired to date?
I'm getting a bit cheesed off with this since being told at the AGM by the Chairman that it was all down to administrative inefficiency on the part of the auditors.
I've emailed Werner and asked him to get the nominated advisor to independently contact the auditors to check that no serious issues have been identified as part of the audit process and that, yes, the delay is just down to a slow process.
Nominated advisors occasionally do have to earn their crust and if I don't get a response from the company I will approach them direct. They after all have a reputation to protect and will not want to be seen ignoring a direct request from a dissatisfied shareholder. Being asleep at the wheel is no protection if later it all goes t*ts up!
The problem with GGP is that although it is worth >300m the debt is rising fast. The cash needs to come rolling in and soon. It's no good having fancy interactive charts showing in exquisite detail the jam for tomorrow when the share price today keeps falling.
I've looked at the company presentation and nowhere could I see when they will actually start production.
Somebody below said soon - but how soon?
Tornadotony I like your posts, you have a lot of interesting things to say. However, here I disagree with you. Mining is inherently and uncertain business compared with other demand focused businesses. Future demand particularly that in developed countries can be predicted with reasonable degree of accuracy, black swan events like pandemics excepted. Mining companies have to deal with uncertain supply and demand! Also they need to go to places where, let's say, standards of governance are not that of democratic countries. Add in a war and you have a difficult business to be in for all concerned.
Yet despite this AAZ have consistently paid out a high dividend, presided over a generally rising share price and continued to built their resources and reserves. I have invested in a number of junior miners and AAZ along with THS are, I consider, the best.
They're not perfect, for example, I'm not sure what the ultimate aim of the Columbian investment is and they certainly dodged a bullet with the proposed Irish involvement. A change in regime in Azerbaijan could be a problem but that is currently not on the cards.
As yes Revolution Beauty! I came across it by chance earlier this week and what a farrago! I hope you don't have shares in the them. From my brief scan it does look as thought there is some bad skulduggery afoot which, even with hindsight, could have been spotted by BDO. Still they do need to service their other clients. So GET ON WITH IT!!!
Sorry I meant major fall in the gold price...!
In response to your questions - 1. I think the major owners have reached the end. They failed to get funding to complete the job and now they want out. The elevated price of gold will just increase their urgency. A trade sale as opposed to a company sale is quicker and cleaner for the buying but as DDD rightly analyses it'll get messy for us owners with perhaps some shenanigans being played out too
2. The they say in the market. An inch ahead and all is darkness. My guess is previous to the gold price rise they'd have accepted $100m but maybe now $125 is the base. If as DDD speculates a couple of extra bidders emerge then we could get a bidding war but I wouldn't count on it.
If the company is sold for less than $100m without a major fall in the share price I'd be surprised....
A rising tide helps save the blushes of all those with their pants down. Dan?
The Q1 results will be in soon (hopefully) so it will be interesting to see what AISC was really achieved....hmm
Also what Cora Bank are charging for the extra slug advanced in December
The company has a lot of unexplored sights that registered on the geo magnetic survey and only one Matilda was drilled. Given the are going to have to arrange a farm in with a bigger miner the share price will also be sensitive to the price of copper if any decent finds are made. Makes for a bit of diversification.
Also did anybody catch Mikes response to the question about potential mergers? The question put to him was about SRB acquiring but in his response he also made the point about being potentially acquired. Interesting...
Yes I attended. No 1 question was was is the audit late? The response was that the auditors are solely responsible for the delay. Both the (independent) company secretary and chairman were in complete agreement. Apparently the twin culprits are wfh and the fright auditors have taken re: recent fines resulting in more box ticking procedures taking more time. I then asked both of them whether the greater time taken has meant a better audit. Both said no which was interesting.
I pushed them pretty hard on this and both maintained GDP had provided all the information requested and it was now just a matter for the auditors to complete their analysis and draw up the formal accounts.
Eyeballing them convinced me this was the case so we'll just have to see
What's the view out there about the announcement of a new non Exec? To me the fact that he is a banker rather than a miner speaks volumes....
The EGM is tomorrow (21st - high noon at solstice!!!) not next week....?
5p fraid not, at least not at the current time of writing.
Adding Zifar and Gilar gives in rounded figures 50k tonnes Cu, 210 oz Au and 60k tonnes Zn. Multiplying by current market prices gives nearly a $1b stache of resources. Not bad for 6 months work and get Mr Market goes meh!
Given the efficiency with which this company has, hitherto, mined gold I have no doubt they will turn a profit on these deposits too.
It's not worth banging you head against a brick wall with frustration. Juist enjoy the divi and wait for the worm to turn. As it will.
That's my advice!
Thanks also to DDD for his/her heroic attempts at valuation. As stated in the calculation is can only be used as a guide.
In reality the price will come done to who is desperate and who is disinterested. Right now it will be CNR who has the urgency to get this done with buyers have the luxury of choosing to any number of cheap junior miners.
Raising the money will help give us much needed optionality and thus make us less desperate, time can be our friend not our enemy. It will however, spin out the sales process and both sides will need to go through the posturing phase.
Patience will be at a premium
GLA!
"My resource valuation using established industry averages for different classes ($20, $30, $130) adds up to $160m "
I'm assuming the figures relate to indicated, probable and proven reserves respectively?
Could you give me a source for these rule of thumb number please so I can check for myself?
CB helpfully included a link to a project in Mali that Endeavour is buying so I thought I try and compare the done deal there with the prospective CNR sale.
Rather than bring everything into the mix I'll concentrate on the relative NPV results. Both use a discount rate of 5% and the assumed gold price for CNR is 1600. The article on Endeavour doesn't state the assumed gp so I'll assume it's similar.
Endeavour are paying $122m for an 80% stake in a project with an NPV of $205m. That's approx a 60% discount on the NPV.
Taking a similar discount on the CNR NPV of $87m give a prospective price of $52m or £43m. This compares with the current valuation of £28m at a share price of 17.65p. That implies a sale price of 27p.
You can argue the pros and cons of each mine/politics/logistics etc (the Mali mine is more than double the size and 3 times the life of CNR) but I for one can see why the Execs want to average down.
Any thoughts out there...?
Seriously I don't get it. "The assets will be valued with no reference to the current share price . "
Really? What do you know that Mr Market doesn't? Or are we talking in terms of blind faith..?
Yeah yeah yeah - it'll fetch 50p easy and look at all my likes for posting that figure.
Just one small problem. This is the worst time to sell. Gold is down, the politics are terrible and the project not finished. Mr Market knows this and has the share price zoomed to 50p?
Nah - 25p max!
They've very sensibly pulled in their horns and concentrated on the core discovery. These are now reserves with a very high probability of being what they are claimed to be. The low probabilities are the financing and political, military situation in Mali plus future course of the gold price. It would have been nice to see a bit of sensitivity analysis - say with the gold price of $1500. Still at 4p it could be worth a punt!
I agree the RNS's are now admirably detailed. At the AGM we had a real push on this and at least management has listened as responded - good for them.
Unlike SRB whose RNS are becoming increasingly shocking.