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'The Group continues to evaluate and update the models on the projects and once consensus is reached that the PGM price windfall is here to stay; Sylvania will reassess the viability of implementing and developing the projects in accordance with the Group's investment criteria for risk and opportunity'
That could suck up a lot of that spare cash!
Also, we are getting pretty close to the Gasvally deadline, I have a sneaky feeling this may fall through due to chrome prices, hope I'm wrong.
Or if you fancy reading the whole thing....
http://www.platinum.matthey.com/documents/new-item/pgm%20market%20reports/pgm_market_report_february_2020.pdf
I always get concerned when I see what I believe to be a price disconnect like this but barring the already known (and not insubstantial) risks of Samancor/Eskom/PGM bubble and S Africa in general I cant find anything.
Even with those factored in this still looks cheap to me.
Volsuprit looks a good asset but would be capex intensive and possibly distracting, that said I'm not sure I'd like it to be sold either, maybe a JV when permits are fully in place?
lol, Looking at the EUA board I'd steer well clear!
Now here's a question for you.....
What makes Eurasia's Monchetundra project worth £190m (current MCAP) compared to Sylvanias Volspurit £30m (on books) and arguably much less when factored into the overall valuation of the company?
Not a huge volume going through (reasonable but not massive) so unless there a large delayed sell then I think this is probably capitulation / stops being hit from PI's.
Personally I thought the results were excellent and everything that was in the RNS (Samanco/Eskom) was, or at least should have been, already known by investors. PGM prices seem stable at very high levels.
Hopefully will come off the 200 MA and bounce from here, and I'm sure Simon Thompson will cover the results in this weeks IC.
I thought this was a bargain at 40p!!
StewartD - From what I understand circa 45% of feed is from fresh tailings, so (if you want a very very basic guess) cut that 45% by 30% (proposed Samancor cuts, which are not confirmed), and you get around 60k PA (worst case scenario IMO)
However, as stated today, the company seem confident that if this does come to pass it can be mitigated by increasing feed from dumps, how sustainable this approach is I dont know.
The have not reduced the year guidance and they are normally quite cautious on guidance so I conclude from that that the situation (and Eskom) can be managed effectively.
These results look excellent, better than my expectations - I'm going to have another read through them and re-do some math but may add again here.
The Samacor/Eskom issues are not new news.
Maybe some fears of Rhodium/Palladium bubble but I wouldnt like to speculate on that, we also know there is a big fund background selling so could be using the liquidity to offload?
Thats an interesting article Tiger.
Note that you need 5x Palladium to replace Rhodium in Cars, so even at $8,000 Rh is comparatively cheap for auto usage.
This might help with Samacor's potential power problems longer term
https://swedishstirling.com/investerare/pressreleaser/pressrelease/?itemID=1A89743880DF0952
Johnson Matthey website has it at $7,950 as of 8/1 - thats incredible!
I'm waiting to be convinced that not only can we consistently make money but that we can also spend that money wisely as well.
Until this is proved then, at this present moment, we are just shareholders in a mining company with no real future beyond 5 years.
Obviously lots of things can happen in the (hopefully near) future to change that but until the company start to prove themselves then that's how it is.
SP treading water is fine for the minute, its all about how the company moves forward IMO, if this is positive then the SP will follow.
'HUM also still has to convince investors that its management is not just a self serving bunch of cowboys, but that it actually gives a modest crap about shareholders'
This - I bought back in with a small position before the last update after selling a fraction higher (but still at a loss) when it all started to go a little t**ts up but I'm still to be convinced by management.
The low selling price for the gold in the last Q is a little concerning (but hopefully just bad timing) and they seem to have a lot of ore sitting on the pad, hopefully just forward planning in case of problems and extra feed for the ball mill.
If things keep going in the right direction then I'm sure the SP will follow but LOM update is key, particularly with such a short current LOM. Is it priced in? Maybe, but I don't think so (at least I hope not!!)
Cant remember where I saw it but I have written notes from a Cannacord broker note that forecast 66k oz produced @$775 AISC for H2 and 128k oz @ $825 AISC for 2020.
This would indicate that they are looking at 35+k oz for Q4 at an AISC of well below $750.
From this set of results I can see the 35k but the AISC may be a bit of a stretch. I preume they are planning to feed higher grade for the remainder of the year and then a slight drop in grade for 2020.
Still, looks well and truely back on track and hopefully this can be underpinned by a solid next 2 quarters now that the rainy season is past.
LOM extention will be key to a proper re-rate of the price I think so fingers crossed for that (and lets not go spending cash on any frivolities please)
Awesome stuff
Just to think, this time last year they had just gone through a successful commissioning and ramp up and we were looking forward to proving up the production and a SP in to 40-50p range!
I would say you are correct DV - The RNS states 'payment due during the qaurter' which I would say is the December 18 payment that fell due during the Q.
Also, if the agreement in place isnt extended then as far as I am aware we revert back to the original contract which was to supply 'up to 400,000 tonnes over several years' (bit vague) but for this original contract there is $250k in a solicitors trust account.
So, I would say, if the existing agreement is breached we have legal recourse to peruse to $350 odd payment due, before we revert to the original contract. If the original contract is breached we should have legal recourse to peruse a breach of contract for that and we should have the rights to the $250k held in trust for starters.
And we get to keep the magnetite.
Thats how I read it anyway, happy to be corrected.
Like the use of caps for placing, very subtle, I’m sure no one will read anything into that.
Agree with other posters on the news but I’m sure the mm’s will have some fun today.
Seems as good a theory as anything else I've read
https://www.proactiveinvestors.co.uk/companies/news/218230/sirius-minerals-surges-as-us-investment-giant-sells-20mln-stake-218230.html
3 months! That’s not good news......
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It’s GREAT news!!! (Best Simon Cowell voice used for that)