Member Info for adamsmithfreethi

Now I don't know the structure of HUM's incentive scheme (maybe I should) but I'm instinctively against buybacks. Why?
Because many exec bonuses are based on EPS so buybacks act as a magical elixir of spondoolies. Simply put buybacks reduce the denominator and whilst the numerator (Net profit) can be static or even declining, EPS goes up and the CEO cashes in despite being a numpty.
No dividends are fine with me particularly with a scrip option...

I looked at this share after an FT tip. After going through the accounts at some length and getting my head around what appeared to be deliberately confusing accounting descriptions I concluded that the model would never work for shareholders. For lawyers yes, but that's another matter.
In fact I don't think the news of a paucity of new cases is even the worst bit. No it's the bit right at the end of RNS where they state the cash inflow in the first 9 months after paying 3rd parties and internal overheads was £1.5m (2019 -32K). That's before presumably investment and financing cash requirements. That is nothing short of calamitous for a business, even after today's fall, is valued at over £130m.
I'm also very suspicious of all the seemingly positive contributions to this Board. All fairly short and of a similar nature, and none attempting to do proper analysis. Organised ramping anyone?

Thanks for the link below to the linkedin report. One thing did strike me though namely that the Kyzlbulage Mine "is under the control of Russian peacekeepers". This seemed at odds with other references in the Board that implied the mine was fully under control of the Azerbaijani authorities and out of all the prospects was the one most ready to bring back into operations.
I found a map showing the status of each district in NK and the nearest town to the mine Martakert does appear to be in an area defined as Part of Nagorno-Karabakh with no scheduled cession to Azerbaijani control. If that is the case then it's not good news as far as I'm concerned. Perhaps this has been covered by a subsequent management interview.
Anyone wish to comment? The wikipedia reference is https://en.wikipedia.org/wiki/2020_Nagorno-Karabakh_ceasefire_agreement

Yeah but you should have tried buying shares when they were at their maximum debt of over $50m. It was hairy.
So hairy that I bombed out at 7 having bought at 14p.
But the management are nothing if not ballsy and you can see the results. Spectacular!

Personally I would NOT want a special dividend on the go right now. This company has a dizzying array of possibilities. Optionality is off the scale but assuming they are level headed enough to pick the best first they'll still need cash and lots of it.
You only have to look at the share price of say SHG to see the impact of an unannounced share place (even with a retail offering).
Why give money back to shareholders when the best opportunities are all in house?
If you need cash - sell your shares!

Great minds or fools eh?
At the risk of enraging failingknife any further I would quote Cicero. Cui bono? The sorted this sort of stuff out 2000 years ago!
The central banks will have noted how easy it has been for western governments to deprive their populations of freedom only to see the aforementioned folk beg for even tighter restrictions. Clamping down on crooks, speculators and boastful media influencers should be a cinch. I think they are just biding their time to see if bitcoin really does pose a threat to gold. Not need to act if bitcoin self destructs anyway....
As for maxim - leave her out of it!

I make it a maxim in my analysis that no player no matter how august is free from a conflict of interest. Thus what they sayt or do can at least be tentatively forecast.
Central banks are no different. One aspect (only one mind you!) of this self interested issue relates to the fact that they are all (with the exception of the UK - thanks Gordon!) sitting on vast piles of no 79 in the periodic table. They are not big holders of bitcoin. If the latter threatens the role of the former are they really going to sit on their hands.
They stand to lose a lot if gold tanks in favour of bitcoin. It also helps that a large proportion of bitcoin is held/traded by shady types the average citizen is not particularly keen on.
Accordingly my central expectation is that the central banks/financial authorities will find it relatively straightforward to clamp down on bitcoin e.g. through forcing better disclosure or else if bitcoin really does threaten gold's central role.
We'll see

You might want to throw Bitcoin into the mix. I've been wondering whether it would being to develop an inverse relationship with gold as investors increasingly saw it as a substitute for the yellow stuff. But that seems to have broken down and there goes my nascent hedging strategy.
For the record I don't own any Bitcoin.
My 2 most substantial holdings are AAZ (by far) and HUM just so you can see where I'm coming from.
On the news front I'm expecting the RNS sometime this week. If it doesn't come out by Friday I'm going to be getting rather concerned that something nasty and not anticipated is in the pipeline.

Yes - just checking it meant what I thought it meant. Thank you.
As far as the price reflecting its true value you just have to be patient I'm afraid.
As I will

There's a view abroad that any RNS on a Friday is an attempt by the company to hide bad news since we all have our minds on other things e.g. the weekend (not sure that works anyway for a world of lockdown)
However, there is another interpretation and that is because the company is keen to get good news out there as soon as possible particularly if the share price has been in the doldrums.
I'm not a geologist and understand there is great potential for obfuscation in reporting drill results however they seem to imply they have drilled 3 holes and in each hole they have found gold. I.e. 3 out of 3. If indeed this is the case then I hold this to be good news. If however, they've drilled many more holes and these are the best of the bunch then much less so...

Tiger I think I must be stalking you or you stalking me. Do you hold CEY too?
As a holder of AAZ and CEY I look forward to seeing your analysis. I've done a fair amount of work on CEY myself and happy contribute where I can

I've been checking the LSE leader board in a vainglorious effort to stroke my ego re:AAZ but nothing doing since stocks like Conway Gold have grabbed the positions. Conway Gold? I know that name! What's caused it to increase that much.
Check the newsflow? Nope - nothing!
So why the lurch up? Surely not in the Irish rubbing their hands on the prospect of AAZ having even more money (and precious management time) to waste on this particular Irish rabbit hole?

Does anybody have any further information on the above prospect over and above that stated in the RNS?

TBTT - you're normally the font of all knowledge. Any further views?

I'm wondering whether everybody is actually overstating Russia's influence post the war. Pre war Russia was sitting pretty being the effective arbiter of the uneasy peace between the warring parties. Post war their influence is much diminished.
Azerbaijan owes a debt of gratitude to Turkey not Russia. The way I see it is that Russia needs to get back some of its lost status and kicking up rough will only set back their cause. I have a sneaking suspicion that they will want to play nice and furthermore pressurise their Armenian client to play along too. After whatever their agreed share of revenues might help support all those now homeless families from NK. Russia is not made of money and they have bigger problems in Syria where the whole state is collapsing.
No my guess is that Russia will want this sorted and quick

Great debate on JLP v THS. I haven't come across JLP yet and from what I've read I haven't missed much. I'm very wary of gifted CEOs who attract a devoted following. I always try to avoid falling in love with a stock although it's hard with some - e.g. AAZ. What I like about THS and SLS are no nonsense guys who've clearly worked there way up the ranks and know the business. Also I like good solid reporting. I've gone back to my accounts DB (for my sins I have accounts of most UK stocks) looked at the ridiculous PE of 10 (that's after paying off the so call indigenous hangers on) and doubled by holding.
Thanks also to the other participants in the debate it all helps to spread the knowledge...

I'm always amused by how BB can feel vastly different even if the companies and their news flow look pretty comparable. Take this one and SHG. Both have announced new discoveries. In AAZ's case we're looking at a combination of Au and Cu and they are only rough estimates but from one area only. This amounts to an increase in of around 2 years worth of production.
In the case of SHG the announcement is of total increase in reserves amount to a gross 175k of Au but after annual production and what they call resource optimisation the net is only 37k or about 50% of production.
Anyway the SHG board in a riot of mutual back slapping and mutually assigned likes. When I asked whether anybody knew what resource optimisation meant it was completely ignored and the mutual congratulation society continued unabashed.
I think SHG is a perfectly good company but it's the band of avid followers that stays my hand in investing with them. It's all a bit too europhoric.
Luckily not an accusation that can be levelled against this board!!!

One things puzzles me. Gross increase in reserves equalls 175k and net increase is 37k after allowing for RO and production. Well from looking at the last 2 quarters say production amounts to 85k then RO is just above 50k.
What does this term term? Reduction in previous estimates of reserves to to unnamed factors?

Well for what its worth I took Tornadotony's excellent link and uses this as a guide came up with a guestimate for the potential resources discovered. They are 36k ozs au and 26k tonnes copper.
Perhaps someone can help me out here. What is the ratio AAZ use for converting Cu into Au equivalents?

Thanks Tiger - you've given me a lot to ponder on. I really do hope they can and will hold actual AGMs this year. They are easily the best way to tackle these sorts of issues. In the meantime I'll follow up on your info and happy to share anything else that might come up...

Just to start with I hold both SLP and THS and I think both are highly investible. I was listening to SLP CEO on one of the investor channels and he reckoned that they have 10 years worth of material at current production. I know they are dependent the chrome miners for the feedstock but it sounds as if they have been quite canny in securing supplies in advance.
On a separate presentation I think the THS CEO reckoned that they had about the same amount in their current low cost pit. Obviously more if Zimbabwe comes good.
On that basis they seem quite similar?