Member Info for Agricore

Janalan, Hopefully you realise that virtually all of the interviews are staged and scripted, and that the interviewer is hardly an interrogator.... as they are getting paid by the interviewee. The only exception I've ever found to this is Matt from C-R-U-X who appears to genuinely probe and question and try to find the rationale to invest and the risks why not to invest. Or perhaps he's a far cleverer interviewer who's still staged and paid.... but is a far better actor than the others.

The best opportunity to watch interviewers is to go to a company meeting and listen to other investors posing questions. The problem with the online version is that the companies can choose not to answer a question and you don't actually see which questions they don't answer (we can only see our own questions not other peoples). My own experience is that I've had quite a number of questions not answered in those online meetings.... and that's told me a great deal about the company and on some driven me to immediately sell. I also email a number of CEOs and ask questions directly. They of course can't tell me anything that's not in the public domain but one can always read between the lines on their answers and again it's very useful to sift the wheat from the chaff.

I consider TTAU completely overlooked by the market both for its 40% diamond/HMS holding and its gold prospecting. The market hasn't factored in that 3/4 of that 40% which will be gradually sold as diamonds are sold (which means money for TTAU), as well as the returns we will see from the 10% non-diluting carry will support the rest of the business through ongoing cashflow.

One tidbit that I took from the interview was the fact that the diamonds are not industrial-grade but jewellery-grade. I read in the Align KZG report that the marine diamonds are 30-40% larger than the land diamonds so given the buoyant and resilient market for diamonds and "fashion" in the East to copy the West (i.e. to buy engagement rings) even in a European recession this should continue unabated.

Where is any of that factored in to the current TTAU share price?

ndm, what news flow were you expecting exactly? Why do you believe that management doing profile raising and newsflow are the reasons companies get close to their valuations?

While there are an interesting portfolio of companies here the success or failure of Wastefuel (83% of portfolio and IX own 36.17% of the company) is the elephant in the portfolio so will be the key driver of value here. We know that Maersk have committed to 30,000 litres of fuel. That sounds exciting. But some analysis of that sobers me. That quantity equates to 23.7 tonnes of fuel which at current prices of £350/tonne equals £8400. So Maersk have not made any kind of huge commitment.

However we know that Maersk will have 12 x methanol powered 16000 TEU ships by 2024. These consume 150 tonnes/day (of heavy fuel oil). Which is about 350 tonnes/day of methanol*. So in a 300 days of operations year those 12 ships will consume about 1.26m tonnes of methanol at a cost of £441m. The Maersk fleet is about 2.5m TEUs so 12 times greater than these 12 ships. So the fuel needed just for Maersk if their entire fleet was methanol powered would be £5.29bn per year.
Meanwhile in the March 2022 analysis Hannam talk about methanol production having between 13%-50% IRR depending on the facility type (refuse derived fuel is 50% while SAF is 13%). So the "newsflow" here is surely Maersk follow on orders, which surely will happen in 2024 following the tests? Other news will be other offtakes and also FID on production facilities for the methanol. The potential for IX could be incredible. In my opinion you invest here not in because of any imminent news but because this could be a multi-multi-bagger with a 3-5 year time horizon.

Source: https://transportgeography.org/contents/chapter4/transportation-and-energy/fuel-consumption-containerships/
https://marine-offshore.bureauveritas.com/inside-look-methanol-fuel#:~:text=Additionally%2C%20because%20methanol%20has%20a,same%20amount%20of%20stored%20energy.
https://www.maersk.com/~/media_sc9/maersk/corporate/sustainability/files/resources/2021/maersk-sustainability-report_2021.pdf
Source: https://www.statista.com/statistics/199443/number-of-teus-of-apm-maersk-in-december-2011/

I've been trying to dig into the assets here to understand them better. I've covered Bilboes previously so why not look at what is now the largest?
Futura is at FID (Final Investment Decision) stage. There should be a decision in late 2022.
See: https://cqtoday.com.au/news/2022/10/17/coal-regions-billion-dollar-baby/
See: http://bakersteelresourcestrust.com/wp-content/uploads/2022/09/Baker-Steel-Resources-Trust_30.06.2022.pdf

It has a large resource including a good proportion at sub 100m depth.
See: https://www.futuraresources.com.au/operations

Total 2.6bt metallurgical coal and 739mt at sub 100m
AISC per tonne of coal for Queensland Australia = £80/tonne
See: https://miningdataonline.com/property/list.aspx?cat=0&cmids=25&tids=1,4&ssids=1,3,2&fm=0&yr=21&rb=on&vw=11

Current Market price for coal is US$385/tonne ~ £350/tonne.
See: https://tradingeconomics.com/commodity/coal

Futura's mine are right next to transport links and other mines. This neighbouring mine was bought for AD$100m with a 60MT+ resource and will yield 3MT/year for 20 years.
https://www.sojitzblue.com.au/gregory-mine

So 1/10 of the size of Futura's resource at sub 100m (let alone the other 1.9bt deeper down).
A planned 2.3MT/year would bring annual revenue of £350x2.3m = £805m and EBITDA of £621m
Minus out the Queensland tax 15% and 40% above A$300 equates to about £100/tonne tax so EBIDA would drop to £390m.

BSRT is on a 40% discount to NAV. Futura NAV's book value is 27.7% of 80.4p/share so 22.27p/share or £24.1m (based on NAV). So the question is even if my numbers are out by a factor of 10 the value here is insane. Assuming the FID gets funding and in June they said "in the next couple of months", then something that generates significant profits of Price Earnings less than 1, but is valued at £24.1m and you can buy at a 40% discount...... (the equivalent of 13.4p/share)

So 51p to buy BSRT where Futura alone seems to be potentially worth at least that based on the nearby mine value and based on comparative Australian mine profitability.

The stranded asset challenge is another factor here but remember this is metallurgical coal not thermal. Hydrogen powered steel making is not happening any time soon so there's a 20-25 year life to this asset.

GLA

Friday's 3Q update doesn't give much detail but there's an increase in NAV to 60.5p mainly due to the sterling crisis 30/09/22 (and reverts LMS to its 31/12/21 valuation).

However stripping out cash you are looking at paying 33p - 22.8p = 10.2p/share. Put another way, net assets ex cash are at a discount to NAV of 74.4% (10.2/(60.5p-37.7p))

But this is for assets where Dacian alone is worth over 11.7p/share, and is generating £1.2m in interest from $9.1m of loan notes (leaving aside that LMS also owns 32% of Dacian) and the interest equals about 5% of LMS' current market cap.... so pays the bills plus the dividends (roughly).

In other words strip that out too and you're getting 1.2p a share plus £20m worth of London property and US VC funds worth 60.5p - 34.5p = 26p a share for free. (102% discount to NAV)

Plus Dacian should grow its profitability through workovers and maintenance. Today the oil price is $96 and gas prices are lower but will certainly rebound as colder weather arrives. Romania do have a windfall tax but even so we should see growing profitability from Dacian.

You don't buy this share for excitement and it feels like it plods along. But if you're patient and are interested in value and overlooked opportunities this is a good wealth preservation share .... its assets underpin its value here and it's incredibly cheap. I'm happy to hold.

Here's some news: the majority holder of Mako/Duyung floated today. Probable cause (although not clear why) for today's drop. Similar drop over at Empyrean.
https://themarketherald.com.au/conrad-asia-energy-asxcrd-lists-on-asx-following-45m-ipo-2022-10-27/
https://conradasia.com/wp-content/uploads/2022/10/Conrad-Asia-Energy-IPO-Presentation.pdf

Here's some news: the majority holder of Mako/Duyung floated today. Probable cause (although not clear why) for today's drop. Same happened over on CORO.
https://themarketherald.com.au/conrad-asia-energy-asxcrd-lists-on-asx-following-45m-ipo-2022-10-27/
https://conradasia.com/wp-content/uploads/2022/10/Conrad-Asia-Energy-IPO-Presentation.pdf

PE of 3.1 in a rapidly growing portfolio solving some of the most prescient issues of scarcity, inflation and health. In portfolio companies finding solutions to antibiotic resistance, vaccines, drug discovery, toxic solvents, farmer robotics, roll out of 5G, AI, modelling of liquid processes eg for waste water modelling.

On a discount to NAV of 25%, and plenty of cash and expertise to support portfolio it's far from a flop - just overlooked. On a great result/update it's 8:25 and not a single trade has been registered yet.

If Maverick was in this share he'd be well and truly under the radar. For us mere private investors this is a great example of the smart money ain't that smart.... because they ain't here.

Deep Matter up 53% today on positive trading update.
https://ir.design-portfolio.co.uk/viewer/103/53844
IPO holds 2.1m shares so a small £0.1m uplift.

Baffling that it should drop 3% on a positive update. We've been here before where fears about provisions tanked this share.

https://ir.backblaze.com/news-releases/news-release-details/backblaze-announces-preliminary-q3-2022-results-ahead-investor

Blze up 15.5% on positive Q3 update

Keith, Given the opening bid price yesterday was 1.8p I think the raise was effectively at nil discount?

Pre-Raise there were 435m shares in issue. Post-Raise 628m shares in issue.
I've been reviewing the 2021 accounts and can find 159m warrants:
(A Warrants 1p, 2.3m / B Warrants 2.5p, 41.3m / 4.25p Placing, 75.6m / 8.5p Placing 39.9m Warrants)
Plus this week Arigo Warrants 3p, 27m / Plus Strategic Investor Warrants 3p, 166m

If every warrant were actioned I calculate that would raise a further £0.02m+£1.03m+£3.2m+£3.4m+£0.81+£5m = £13.46m of further funds.

The shares in issue would then be: +352.1m = 980.1m. So that's a potential 55.5% dilution (including the dilution from week's raise)

One can take a positive or a negative from that calculation. Personally, I find it encouraging that success will drive further funds in.

Share up 20% today on its trading update:
"Full year revenue, adjusted EBITDA and cash guidance unchanged"
Another CHRY holding apparently worth zero, yet is quietly getting on with business, and doing better than expected.

Nivig,
>> Can't see why you're so exited (sic) of loosing (sic) 27%.
By your logic I've "lost" 27% of my investment. But by the same logic I gained a share of £3m injected to the business.
I'm excited because I understand the importance of cash for any business, and how that £3m can fund important drilling to substantiate what now feels substantially derisked based on their thorough analysis and approaches to techniques like CSAMT. Time will tell whether that faith in KAV is well placed. Next door is Sandfire a 30 bagger over the past 12 years. So I can only lose 1X my money - if you're shorting KAV then you could lose much more. Bring it on.

3rd quarter update should be out this week. It’ll be good to see some progress on Dacian oil, and the consolidation they spoke of. What’s actually quite impressive is how LMS has quietly steered a course through a pretty challenging couple of years without any real loss of NAV. It remains stubbornly on a huge discount to NAV

Slipershare, if this is a pump and dump, then yours is a cut and paste straight from *************.co.uk
Well done on your pasting skills.
PS but where's the dump exactly? I don't see any RNS of a KAV Director selling?
PPS where's the pump exactly? The RNS says the funding will provide funds until the end of 2023. Isn't that just stating a fact, rather than a "pump" which is usually a phrase to describe someone making some baseless claim of fantasy, lie or deceipt.

Perhaps have a think about the actual facts before you Ctrl+V anything else.

I'm happy with the raise. A 27% dilution is academic once we hit pay dirt.
KAV have demonstrated a cost discipline and I've said before £3m in their hands can go a long way.
Like others, I'm underwater, but I remain optimistic. Remember KAV management have sunk much more cash into this than either you or I. They've diluted themselves much more in absolute terms than we have been.

GLA and here's to good news on the KCB, KSZ and Ditau.

Metalhead
You wrote "- fuel prices coming down"
The fact is today WTI Oil is $84.70/barrel which now is up only 2% year on year!
The fact too is that much of the mining equipment will be electrically powered. The Namibian electricity tariffs appear to be incredibly cheap N$2.35 is about £0.11/KWH (and that's described as the peak cost)
See: https://www.nored.com.na/electricity-tariffs/

So some substantiation to your more reasons to be (very) hopeful about cost.

You should ask them Rofert.

But I expect the answer is that this is a *GROWTH* portfolio. Their remit is to grow and support the portfolio companies. They can't financially support them as well as hand cash back to shareholders. And that shouldn't come as any great surprise to you either. When a "liquidity event" occurs (such as described above) we'll probably see a tender offer then - if there's spare cash.

GLA

Initial thoughts:

ED have today finally brought out revised estimates where they see FY2023 EBITDA of £17.5m vs my £23m and EPS of 9.3p vs 13.3p. Their FY2024 numbers are very close to my own estimates.

I think I stand by my own numbers for FY23. The fact that SUP report recovering lighting for September (remember we still have 6 months to run for FY23) and that growth for Vaping is on track in fact is on a "strong growth trajectory", suggests that ED are being too pessimistic.

Remember that there are a number of synergies which SUP can unlock, including cross sell opportunities and some cost efficiencies which will feed through too. These don't get a mention in today's update but will reflect in the full year numbers. I'm glad I added here last week expecting an update by the end of October.

I also noted last week that IMB was at a 52 week high (almost the only share at a high). Since this is almost 3/4 Vaping, the peer analysis to Tobacco is the most relevant. However it potentially ticks the box around ESG (reduced harm), around cross sell opps (Tobacco don't have those same opps!), and for the fact that the debt levels here are lower than most tobacco firms. The PE ratio, if anything, should be higher not lower than say IMB's in my opinion!

Next month's update will be very interesting!

As reported in the FT and also reported here:
https://thehitc.com/jupiter-is-negotiating-the-sale-of-shares-in-the-digital-bank-starling/
https://www.ft.com/content/a77eeefe-1147-411d-bf89-c563c54afb77

More bad news for us long-suffering CHRY babies? Or more evidence of CHRY's fundamental value?

CHRY Market Price 57.3p/MarCap £355m/NAV as at 30/6/22 is 163.48p/Net Assets £973m/595.2m shares
30% of CHRY market cap is cash (as at 30/6/22) and listed equities (17.6p a share or £105m) that leaves £867m worth of unlisted investments as at 30/6/22 valuation. So you're in effect paying 40.4p for 145.88p of unlisted - so a whopping 72.3% discount.

Of that 40.4p, when you consider a potential sale of Starling. The Starling holding was bought for £88.2m. It’s priof fair value (31/12/21) was £210.7m and its fair value upgraded in the last interims to £259.3m. So a 40% “loss” is actually a ROC of 2X (so not a loss at all!). In fact, the sale at a 40% discount last fair value would generate 25.9p per share for CHRY.
That means buying a CHRY share you are paying 14.5p (ex cash/listed/starling @ 40% off) for £608m worth of unlisted investments worth £102.3m so that’s an eye watering 85% discount to NAV!!

Of those unlisted companies, Klarna alone (which was “down rounded” just a few months ago is still worth 40.55p/share alone)..it was 64p a share prior to the latest funding round. So if Jupiter were to sell the Klarna holding, too, at let’s say a further 40% discount then you are in profit (24p proceeds less 14.5p is 9.5p/share profit).

In other words, isn't there a touch of insanity to the current share price?

Apart from the 9.5p profit from a Klarna sale, you are also getting holdings worth a further £367m (or 61.6p/share) in: WeFox, Smart Pension, The Brandtech Group, Graphcore, Featurespace, Deep Instinct, Wise, InfoSum, Tactus, Sorted and Secret Escapes all for free. For free!