We would love to hear your thoughts about our site and services, please take our survey here.
For what it’s worth, my view is that the shares given to CB and LC in lieu of historic salary and then sold during the financial year has created an embarrassing figure in the Directors compensation section of the Financials. Which is probably showing CB as having received £2-3m in compensation for the year, this they are having to smooth over with the II which is taking some time. Could be wrong, just my view.
Just reading the last couple of RNSs, one states that we have the processing capacity on chrome of 250,000 tons pm or 3,000,000 tons pa. Also stated is that we will be processing some new material at 30,000 tons per month equivalent to 1,600 oz of PGMs per month. Assuming that we haven’t invested in all of that processing capacity for nothing, then by my calculations that means we should be producing the equivalent of 160,000 oz of PGMs pa. of course grades may vary but it does make you think.
Craig is of course right, but each to his own on risk tolerance. Diversification obviously mitigates risk, but it also reduces rewards. For me it depends on how confident I am in the Company to produce Alpha (individual stock out performing the sector or market) as opposed to Beta (market return). With JLP, based on everything I know at this moment in time, I am reasonably confident. However, my risk profile now, as opposed to when I originally invested, is very low given that my cost averages 3.8p on a significant number of shares. That not to say that I don’t believe there is tremendous upside from here, as like many I believe these shares have the potential to go to 50p and beyond. AW
Someone on the other board has asked how long the cu tailings will last, at 0.03% copper and producing 25,000 tons pa, then JlP would need to process 8,333,333 tons of tailings pa. Giving an effective length of mine of 36years. So my belief is that the 25,000pa ton target is just the start.
Sharky, In my opinion you're a little light with you estimate. The all in cost to Sable was $4,000, when copper was $6,500 per ton. This included a charge from the JV of 38% of the spot price plus operating costs of $1,530. So if you assume a CIR at the JV is 50%, as they must be making a profit as well, and we get 50% of the JV profit, then at $10,00 per ton the profit to JLP works out at...
($10,000 * 25,000) - (25,000 * $1,530) - ($10,000 * 25,000 * 38%) + ($10,000 * 25,000 * 38% *50% (CIR) * 50% (JV profit share)) = $141m. Although this I think is conservative as I can't believe the operating costs of the JV will be $47m. There is of course the cobalt which could potentially add another $80 m - $100 m. Plus of course whatever is factored in for PGM's (currently at circa £60m - £80m pa), and the Zinc lines which are due to come on board towards the end of the year. We could be looking at mind numbing numbers.
All IMHO, AW.
New interview
https://www.***************************/jubilee-metals-group---another-set-of-strong-results-with-further-revenue-streams-coming-online-interview/412971092
I'm sure we have all done our research, and come up with varying share prices and our exit targets. Mine, fwiw, is a current fair value of circa 65p - 75p, based on what I know at this point in time. However, with a very significant stake here, for me at least, at an average of 3.8p, watching the value of this holding increase does make me nervous, not that I don't think that it's worth multiples of the current price. I check and recheck my calculations and still come up with the same answer. I know that investment hypothesis says I should top slice, but I then try and think where else I could put my funds, and it's very hard to find an alternative that has as much potential as JLP. I hope that LC continues with quarterly and project updates, as this is moving so fast they need to be very careful to provide transparency in all that they do. Still nice problems to have I guess.
The operating costs for copper per tonne, including JV profits are
(4000 -(38% x 6500)) + (C x 38%) -((C x 38%) x 50% x 60%)) = $1,530 +(C x 26.6%)
Where C is current price of copper. So at a copper price of $7,500 per ton profits to JLP are
($7500 x 73.4%) - $1530 = $3975 per ton. Cobalt not included.
Sorry I like numbers.
Aw
Don’t forget the profit from the JV concentrating the copper. This sells the concentrate to JLP for 38% of market price which was included in the $4,000 all in cost (when copper was ~$6,500 per ton). From this if you assume a CIR of 50% (after JLP have received back all of the costs for building the concentrator) and a JV split of 60:40 to JLP then current profit due from the JV to JLP at $7,500 per ton and 10,000 tonnes pa would be ~$8.6m pa.
So if one assumes a CIR of 60% at the JV then profit in the JV due to JLP is $7,800 x 38% x 40% x 60% = ~$711 per ton, which if added to the $3,300 at sable gives $4,011 operational profit per ton of copper (likely to increase with economies of scale). So on 25,000 tones of copper production you get profits of $100m, which added to the pgm profits of $80 to $100m gives an impressive figure.
Zinc, Vanadium and lead at Kabwe will also increase this by a reasonable amount.
Aw
Jolly, it included it, or at least it did at the time when copper was selling for $6,500 per ton. Leon has stated that the JVs will sell the concentrate to Sable at ~38% of market price. So at the time we could extrapolate that processing cost were $1,500 per ton all in. Which brought us to the $4,000 number. So if you continue to $7,800 per ton sale price then Sable will buy from the JV at ~$3,000 per ton plus the $1,500 processing costs, gives current costs to sable of ~$4,500 per ton. So a margin of ~$3,300 per ton at sable. One shouldn’t forget that Sable bought the concentrate from the JV and we are due 50% to 60% of those profits, after the JV has paid Jubilee back for the capital outlay on building the concentrator. There may well be economies of scale at Sable once Roan and Elephant both come on line. Hope this helps.
AW
If we extrapolate this to the 24,000 tons pa when project elephant is up and going then we are looking at $6,450 x 24,000 x 38% = $59m, plus the $30m from PGMs Is an operating profit of $90m pa plus then the zinc, lead and vanadium at sable, this becomes a substantial future cash flow. Yes I know that it’s jam tomorrow, but it does actually look like it’s happening this time.
Bamps, it states that JV will sell to sable at 38% of copper price ie ~$2,432, and that the all in cost to sable is $4,000, so the cost to process would be 4,000 - 2,432 = ~ 1,600 per ton leaving 2,450 as operating margin. Which does tie in to the 38% Leon previously mentioned. So operating profit of $24.5m pa plus, JLP’s share of the JV profit.