Member Info for bangrak

A quick read of RNS and figures, need to look at the balance sheet further but $89m net assets with a cap of £12m is appealing. Might have trades into double figures today.

https://tradingeconomics.com/commodity/rhodium

Basket price now $3049 an oz
EPS around 23p.
61.48% of revenue from Rhodium
Lazy Broker target based on $1832 basket
Lots of cash
No debt

Target 115p to start which is actually below what some peers are trading at now on "possible" future earnings so this is cheap
Free cash near $20m a quarter. Why buy on a possibility in 1-2 years when this does it now?

Gold Panda "I was conservative in light of the crash in March. Volatility will be very high"

The Rhodium price/chart does look it's happy holding above $13600 as it's been above that on average now for almost 3 months. For me, this tends to indicate quite a high level of support just like gold is at $1886. I think your $5000 is way too low, but who says volatility "will" be high, we just make calculated forecasts on whats we see. I say we "probably" remain above $13000 for many months and hold the early 60's with dips being bought quickly. It's gone quiet which usually means confident accumulation.

I assume after the last miscalculation in the expected dividend, Ben Davis at Liberum got a better idea of what the dividend could be to save further embarrassment. In the latest note on research tree he has 14.6c as the total 2021 dividend. 2022 is 18.6c and 2023 21.6c. Another bonus is the EPS has been upgraded to 20c but I think it's about 22p now anyway.

An excellent operational performance in Q1, given the challenges of lower feed grades, and remains on track for full year guidance of 70 koz. With the group’s PGM basket price nearly doubling in ZAR terms YoY, EBITDA was up 78% YoY and net cash rose to $61m. We believe PGM prices remain well supported at these levels and can go higher given the robust supply and demand fundamentals. Sylvania Platinum is the best way to play the space and has vast re-rating potential versus more expensive peers. We increase our TP to 140p (prev 115p) to reflect our new PGM forecasts and it remains our top pick.

I was sure earlier in the year they were a bit light with 100p so this is good to see.

GP, Nice article but can you clarify this as it seems a little low?

"It’s very hard to forecast prices when structural deficits exist, but I think it’s safe to say rhodium is likely to remain volatile and sell for over $5,000 per ounce in the near future"

Surely people investing here must know that there are other o/s court cases and that the $4m cash generated was due to them stopping all expenditure inc drilling? Why get over-excited about gas when Rhodium is ripping and in short supply?

I'm going for a little lower at $17.5m, I do have $19.9m based on current prices though. The July average for Rhoduium was $8602 with the quarter being $11,141 so it was August when it really kicked in. The last 3 months including October $12,842. It does seem that the consensus on here is $15-20m so this is still on a pe of 2.81 which is still what it was a few months ago. Interested to see what they do with this cash, people love growth stories of big things to come in 2-3 years, but things change so quickly.

Impressive, target 400p+ 12 months.

Heraeus update 12th Oct.
China’s automotive market has shown a remarkable rebound from the Covid-induced low earlier in the year. The world’s largest gasoline market recorded double-digit growth in August, rising for the sixth month in a row, and preliminary September results from some automakers have shown the trend was maintained. The China Association of Automobile Manufacturers now expects full-year sales to fall by less than 10% this year, a vast improvement from the 25% drop initially forecast in the first half of the year. ‘Golden September’ and ‘Silver October’ are considered the high season for car sales, with customers typically returning to make big-ticket purchases after the summer.

Rhodium
With prevailing high prices and supply not expected to keep pace with demand, there is motivation for South Africa’s producers to plug the gap. Over the last 10 years just over 150 koz of rhodium supply has been shuttered. Conceivably, some capacity could be recommissioned within three years. Rhodium’s market deficit is expanding, and unless mothballed mines in South Africa restart, supply will continue to fall short of growing demand.

TT. £28m for the quarter would be at today's basket price inc chrome so the £23m they state is about right i have net profit at £37m with current prices so the £15m seemed high to me.

Using today's prices I get £28m as quarterly income with the net being £9m so I'm not sure what has been omitted this quarter to get that figure of £15m as it does look quite high. Margins are good but not that good.

I've looked at it and did buy some at 73p to see if I could cure my phobia of Cypriots shortchanging me, but it's position 15 on my list or division 3 so it doesn't get much cash. However, a £25m cap with $4m a quarter free cash in depressed oil & gas prices is exactly the headline that interests me hence my mention yesterday, ok it's not a neighbor but its double the cashflow to cap that SLP is giving. Not a word about cash in that Tharisa RNS unfortunately, I always alt +f cash on every RNS first to save time. Companies (like slp) are always proud to mention cash if they make it. The Mali gold lot is very good, got 35% of my money in that one now. Quarterly report here should read very well indeed and that early 60's support here held well. It's doing its thing and consolidating so we are due a move up soon.

Good but still not as exciting as SLP though, lets see what cash generation they come out with. This quarter will be interesting for SLP. The average Rhodium price in the last quarter was $8280, this coming quarter its $11,141 so a descent 34% boost. Platinum $799 to $910 and Palladium $2018 to $2188, so all three up in the last quarter. If you like cash generation then the RNS from JKX today was interesting to read.

"Hope no one is taking these historic 'seasonal' expectations too seriously. Especially if the other months hit the mark; which would be asking too much."

Hope not, it's all to do with the underlying PGM metals prices and momentum. If Rhodium didn't shoot to $10,000+ half the investors here now wouldn't be here and you would not have had these sharp rises attracting traders. Do you really think that this moves totally separately from the underlying PGM prices particularly Platinum and follows the same kind of yearly patterns like mince pie and turkey sales? I understand the desire to see patterns but Oil & Gold companies rise when prices rise, demand here is driven mainly by car production in China and the scarcity of Rhodium as highlighted in several 60-page reports I ploughed through. SLP seems to be generating about $15m a quarter in free cash at these prices despite the dull platinum chart/price. Highlight a seasonal demand for the PGM driving prices and that makes sense. It's currently an 8-day national holiday in China and look at Copper prices, China has a holiday and copper falls, copper falls people think the world economy is falling, China returns to work and copper will go up.

The average prices for the three in 2020 so far are PL $874, RH $9905, PA $2177 using the monthly averages on matthey so this gives me an EPS of 18p. Heraeus has some predictions for the three at $900, $9500 $1950 which again gives me an EPS of 18p. Having a look at the historical PE Ratio (trailing) over the last 3 years based on the average share price and the 52-week high and low range, I get 6.4 when I also include the market median for metals at 10.9 with a SA discount. So still one of the best things I can find before I include dividends, cash held, assets, etc. Still think the BOD is way too tight and should shell out more cash unless they put it to better use. According to my sheet, they could give away the platinum and still make $55m+, or give away the Rhodium and make $30m.

Baltic dry is rising after a few weeks of being lost. Dr Copper is stable and still in an uptrend. Rhodium and Palladium are still looking very good. Platinum looks weak. China is doing fine & people are buying cars. Mothballed rhodium mines cannot be opened quickly indicating higher ($10k+) Rh prices will remain for quite a while. Most people dont care about the flu unless they are fat, sick, or very old. Everyone wants to get back on planes and fly about again and are bored with it. SLP hit a sticky patch at 70p it's fallen back, momentum traders have left and now we are all looking at it saying a basket price of $2852, an EPS of 22p, worth an easy 95-112p. Considering what's going on I would say the next week or two is a good time to do some shopping until the unnecessary fear is gone, fear causes stress, rational, logical thinking creates peace.

DL
Happiness can just refer to the pleasure we find on a sensory level, but real happiness is related to peace of
mind. If we have a calm mind, fear and suspicion are reduced. Fear is a major source of unhappiness.

"A few days ago it looked like 71-73 would be tough (it was) and the early '60s was solid (it will be) . As many are traders here because they constantly talk about daily price movements whilst claiming they don't watch the price or care for its movements, surely that is what is the aim of the game to drive it down like a few days ago"

"it will be"

UT is an uncrossing trade that happens for a reason. A few days ago it looked like 71-73 would be tough (it was) and the early '60s was solid (it will be) . As many are traders here because they constantly talk about daily price movements whilst claiming they don't watch the price or care for its movements, surely that is what is the aim of the game to drive it down like a few days ago? It will do whatever CFEP and JBER want it to do, watch them on L2 working it, lads from CFEP went to JBER few yrs ago it's their style, they milk the order book after any large volume, that's how they make money, volatility and so do you. Anyway good company huge cashflow buy or sell as you wish.

Thanks...Ive not looked at this in any great detail until today and I can now see that the $42m was for ex-works chrome sales, chrome sales were actually $77.6m for the half. Assuming this is the same and the prill split is PL 54.9% PAL 16.7% RH 9.8% Rut 14% IR 4.4% then i get a total income today of around $488m but the expenses/costs are knocking off 90% so my EPS is 14p. I see the brokers are giving an EPS of 27c or 20p for 2021 so if the cash is going on expansion and that is the result then it looks ok, no rush to get in but good for nearly 100% down the line. Kenmare looks ok but now falling out of my 100% gain target.