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@headdancer Personally I would want RB to AVOID any JV or sale until 50Koz+ production has been achieved and decent shareholder value has been created AND priced in ... anything else and someone else gets the benefit not us PIs
ATB APR
Simply I think the market ...
> Reacted very positively to 2x funding news confirmation & went 0,725p > 1p then formed a bull flag (good)
> Reacted very badly to the additional 3-month delay to start of 2koz/month moving from Mar to Jul-23 & went 0.95p to 0.75p forming a bearish megaphone (not so good)
Those who traded the rise and fall probably did well but you need strong cajones to get the timing right or risk being bounced out!
For those non-traders then 0.725p looks like strong support and buy-zone as the SP hopefully consolidates between 0.725 and 0.875p.
ATB APR
@ID78 I'm probably seriously out of date on GGP anyway so before someone bites my head off checking with their Sept-22 presentation ...
GGP are very low AISC =$643 and MCap = £398m with total 6.9Moz resources of which 30% or 2.8Moz is attributable to GGP as it has also had to stump up $98m for its share of CAPEX with no revenues so has had to take on lots of debt for the 30% share of the up-front CAPEX.
Yep scary but chalk and cheese as GGP has 2x GCATs 1.3Moz resource and 35% lower AISC !
ATB APR
I can see my way to £100-120m on the back of both Kilimapesa & Nyakafuru @40koz/annum each for 80koz/annum overall at modelled $1,650 POG & $1,100 AISC ... but then the possibilities play out when current £16m MCap
Current Situation
Kilimapesa produces 500oz/month or 6koz/annum with $1,100 AISC & POG=$1,750 so
MCap=£16m and £2.75m FCF/annum giving P/E ratio =5.8 as some growth priced in already!
Assuming Scoping study metrics of POG =$1,650 & AISC =$1,100 plus drop P/E to 4 as transition to producer
> kilimapesa @24koz/annum = £11m FCF/annum so implies MCap £44m @P/E=4 or 2.8x from here
However we do know Scoping study %recoveries are conservative so AISC will drop as less ore will need to be mined & processed to give the same 2koz/month gold output ... lets assume conservative 11% cost saving (HL =22.2% and Plant 1&2 =0% with 50% of gold output) which itself is still conservative!
1) Assuming POG =$1,650 as modelled & AISC =$980 (or 11% costs savings)
> kilimapesa @24koz/annum = £13.4m FCF/annum so implies MCap £53.6m @P/E=4 or 3.35x from here
2) Assuming POG =$1,800 (current PX) & AISC =$980 (or 10% costs savings)
> kilimapesa @24koz/annum = £16.4m FCF/annum so implies MCap £65.6m @P/E=4 or 4.1x from here
3) Assuming POG =$2,050 (all time high) & AISC =$980 (or 10% costs savings)
> kilimapesa @24koz/annum = £19m FCF/annum so implies MCap £76m @P/E=4 or 4.75x from here
3) Assuming POG =$2,300 (Consensus 2023) & AISC =$980 (or 10% costs savings)
> kilimapesa @24koz/annum = £26.4m FCF/annum so implies MCap £105.6m @P/E=4 or 6.6x from here
So to 40-bag implies MCap £640m from current £16m MCap so ...
for Kilimapesa only @Jun-2023 target 24koz/annum output
@24koz\annum & $980 AISC plus P/E ratio of 4 would need £160m FCF or POG = $8,980
@24koz\annum & $980 AISC plus P/E ratio of 8 would need £80m FCF or POG = $4,980
@24koz\annum & $980 AISC plus P/E ratio of 12 would need £53.3m FCF or POG = $3,645
for Kilimapesa & Nyakafuru @Dec-2024 target 48koz/annum output @Nyakafuru and 18 month build
@72koz/annum & $980 AISC plus P/E ratio of 4 would need £160m FCF or POG = $3,650
@72koz/annum & $980 AISC plus P/E ratio of 12 would need £53.3m FCF or POG = $1,710
For reference GGP has circa £398m MCap, no revenue, lower forcast AISC, lots of debts & lots of drilling costs plus 30% of 3.5Moz JORC or 1Moz attributable resources ... poor comparison I know!
ATB APR
@ID78 I can see where you are going with the extra 10% on recoveries ... but in reality a 10% uplift on recovery from 45% to 55% via Heap Leach is 10/45 =22.2% more gold and not 10% more
... IMHO the internal Scoping Study NPV and FCF is massively understated as it was used to secure the funding so need to work even if the "wheels fell off" plant %recoveries AND POG !
ATB APR
Excellent interview thanks 'Santa' McCrae and yes I think you and your team pulled an absolute blinder turning around and confirming £11m non-dilutative funding in less than 6 months for a £13m MCap Junior gold producer.
Not too bothered about the 3 to 6 month mine/plant upgrade >commission >production delays given the 2.5p warrants were not going to be bringing in the capital so having AND delivering the Plan B was very welcome especially as you only make a loss if you sell and I have been buying
ATB APR
On the weekly chart GCAT has exhibited 3 very clear trading ranges since Nov-21 which is 13 months, BUT has been very volatile within each extended range as follows:
Range #1 = 0.625p and 0.875p from w/c 9-May-22 to date or 31 weeks ... intra-week down to 0.575p low Nov-22
Range #2 = 0.875p to 1.025p from w/c 7-Mar-22 to 9-May-22 or 9 weeks
Range #3 = 1.025p to 1.375p from w/c 17-Nov-21 to 7-Mar-22 or 17weeks
IMHO we are now significantly derisked and the price has moved from Range #1 back up to Range #2 and is looking to stabilise but needs to retest 0.875p before it can be categorically confirmed as support.
The other way of looking at this is following the MCap which launched at £13m in Aug-21 and has traded £12-£14m for the same period. MCap has now moved up to £16m @0.875p to reflect the derisking that the confirmed funding brings and IMHO will incrementally rise as upgrading and increased production news confirming that the funds have been spent ADDING VALUE.
Taking my "rose-tinted" goggles off and stepping back a bit IMHO GCAT is demonstrably a well funded Developer, Explorer AND Producer with:
> Strong, experienced & well connected BoD with capable management team delivering +ve change on/in the ground
> Low risk of shareholder dilution as Robbie, CEO is 5% shareholder
> High probability of MRE being increased from 1.3Moz to 2Moz & LoM from 10 to 15-20 years in next 1-3 months
> High probability of increasing production from average of 490oz/month over last 12 months to over 2koz/month in the next 6-9 months
> High probability that Kilimapesa production will be leveraged to secure further non-dilutative capital funding via OCIM/Philoro for Nyakafuru 50koz/annum mine build
This is not to say that stuff won't go wrong as this is still high risk BUT now much lower downside risk AND path to lots of upside especially with low Scoping Study AISC of $1,095 & decent IRR of 114% with 2-year payback. This is an enviable position for a Junior Goldie to be in as it generates REVENUE & has access to £11m cash facilities to be paid back via its gold production which it needs to sell so why not to OCIM/Philoro at a modest discount to spot?! ... it also probably explains why I am heavily invested!
DYOR ATB APR
@Spallted well if RM is alone in the office he can just press SEND on the overdue Q3 Operations report to end Sept-22 so we can all have some light holiday reading and he can go off for Xmas with a clear desk !
ATB APR
@DSFlat Thanks for your honesty ... never easy on these BBs sometimes
ATB APR
This Scoping Study for for the EXISTING Kilimapesa mine completed to underpin the Due Diligence undertaken by the recently confirmed non-dilutative funding of $10.5m from OCIM and the $3m from Philoro.
It is based on existing stated Kilimapesa metrics:
> 24koz/annum gold production from Mar-2023
> Upgrading Plants 1&2 from 500tpd to 1ktpd .. traditional mill, grind, gravity, CIL and tailing reprocessing
> Completion Plant 3 @35kt & Plant 4 @120kt capacity Heap Leach
> Updated MRE @Jul-22 of 705koz and 10-year LoM
> US$19,7m pre-production capital ... lots of this is already sunk capital since Aug-21 RTO (@Aug-21=$6.6m & $2.4m @Feb-22)
It now confirms several things:
> Solid economics with IRR of 114% and 2-year payback
> AISC @$1,095 ... previous guesstimate of $1,100 so not bad RM
> High project %IRR based on conservative economics with low POG of $1,650 & AISC $1,095
> Free Cashflow (FCF) ... so first 12 months FCF = $13.6m versus $12.6m stated in RNS implies $1m funding repayments or $41.6/ounce
>> Months 1-3 = ($1,700 -$1,095) *2,000oz =$1.2m/month
>> Months 4-12 = ($1,650 -$1,095) *2,000oz =$1.11m/month
>> Difference in Y1 FCF =($13.6m -$12.6m) / 24,000oz = $41.6/ounce "other non-AISC" costs
Importantly it also EXCLUDES:
> Expanded MRE based on extensive drilling campaign underway since Jun-22 expected to double resources and LoM with eventual target MRE of 2Moz (3 times current MRE)
In Summary:
IMHO this is a massive confidence boost in GCAT project economics and reconfirms the extensive DD completed as part of securing 2 big sources of non-dilutative funding secured against up to 20% of gold production.
Do not underestimate the positive effects of POG above $1,650 from month 3 which would accelerate on project IRR & payback in anon-linear fashion.
ATB APR
wow ... and that is what I call a hard bounce as MMs clean out stop losses below 0.875p all the way down to 0.822 to feed the buys all the way back up to 0.9p.
So looks like 0.875p should be a good solid support line on reasonable 31m volume so far today
ATB APR
@Coldspy Agreed I am now expecting higher highs and higher lows from here on in
ATB APR
Looks like price has returned to 0.875p prior resistance after the recent price spike following the very positive funding news. Whilst frustrating thsi type of price action is actually very normal in a sustained rally and IF 0.875p holds then it will be a bottoming pattern confirming 0.875p as support as short term sellers exit and stronger hands take over.
I could easily be wrong but IMHO I suspect that we should get a decent bounce and/or consolidation above 0.875p
AYB APR
Q3 Operations Report to end Sept-22 is now WAY overdue .... expected news on:
> gold production ... estimate 500oz/month in Q3 due to plant 1&2 upgrades
> production upgrades ... plant 1 & 2 status and timelines
> Plant 3 Heap Leach ... confirmation as 3x 15kt pads =35kt capacity and completed Q3
> Plant 4 Heap Leach ... confirmation as 2x 60kt pads =120kt and construction still WIP
> Heap Leach %recoveries for given cook-cycles ... would be nice as last was 53% for 2 weeks on Plant 3 Pilot in Mar-22
> Confirmation of end Mar-2023 target as production or capacity ... wording was unclear
> Updated MRE ... expected end Oct-22 plus confirmation that JORC compliant
> Update on expansion drilling progress across Longorian licence area around Kilimapesa
Fingers crossed will drop soon as suspense is killing me !
ATB APR
Just looking at the Daily GCAT chart we have clear support/resistance price points at 0.6. 0.675, 0.725, 0.875 & 1.025 which have been key inflection points established as the price has ranged from Feb-22 through May-22. We have (rightly) had strong positive reaction to the recent funding confirmation news with eth PX peaking at 1.025p (opening) and now heading back to 0.875p which should now be strong support.
... IMHO I am expecting 0.875p to hold albeit I am expecting it to be tested as traders cycle back out and take tehir profits
ATB APR
@Trek So reasonable worst case ... any POG increase, AISC reduction or amortisation over a longer period helps your payback figures, but as you say other than the small %fee there is not a lot else to go on
ATB APR
@Trek Just trying to get my head around your numbers ...
1) why assume 20.4 months term for OCIM Tranche 1 $10.5m or is that the term that is spat out assuming 2koz/month and 2% fee on 10% of production?
2) why assume 6 months at $500k/month for Philoro $3m loan when they said 6 tranches but no idea of period ?
Agreed on POG premium as output is metal and not paper and OCIM will be really making the "real" money on the arbitrage supplying metal into physical market where coins et al trade on significant premium to spot price
ATB APR
@JC Agreed, now that the £11m non-dilutative funding facilities have been secured it is all about GCAT BoD delivering on their 2koz/month or 24koz/annum production promises for end Mar-2023 which is a ramp up of approx. 4x from the current circa average of 490oz/month since Aug-21 RTO.
ATB APR
@ID78 Thanks appreciate the feedback, and in all seriousness go have a look at the decent investee companies I follow closely Rincon Resources (copper/gold), Charger Metals (lithium), First Tin, Eagle Mountain Mining (copper/gold) and Pacific Nickel (too easy).
Rincon Resources is still my favourite despite the drill campaign running about 12 months behind where I had hoped it would be; on the flip side they have added a new Paterson tenement and all the evidence says they have their gold under 80-150m of barren cover rather than GGPs and WSBNs 300m+ cover.
ATB APR
Not seen any posts since Jun-22 appear and given large bounce that seems an issue with BB ?!