Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
The RNS today is a little vague about profit at the interims the figures for t/o being down compared to last year interims would suggest lower than then, the weighting to the second half encouraging if the step up is both big enough to make up for the first half being lower and some worthwhile growth for the year as a whole. Hope ALK do not have to pay tax on the paper profit of the EDG shares at the year end it will hurt cash flow. Will be interesting to see how the DSBR affects ALK should be positive and make the whole standby production side more profitable.
An interesting notification of a major holding via the RNS today - welcome aboard Standard life with 6.103% holding what is interesting is that they are named in line 3 but in Line 4 we are given the Full name the holding held in by nominees Vidacos/HSBC. In the previous couple of posts we have been looking the holding in CLA which AVAP are slowly buying up and OLiG pointed out that Vidacos hold 23.64% of CLA. just co-incidence? or is Standard life behind the CLA holding also? has SL become a major investor in AVAP prior to converting it's CLA holding into more AVAP shares? Is the holding the result of a conversion of their shares in CLA (expensive if so) I wait with interest for further details.
Good to see the second director in two days buying shares in addition to the major holders declaring recently, the latter are in for a steady return (see previous post) with little excitement.
Whilst I don't own any Egdon i keep my eye on it , I notice the BB has gone quiet (half a dozen postings in the last week) and the Sp seems to have peaked for now and is drifting down - still well above the 20p level used for the deal with ALK. Seems like all the excitement has just moved on elsewhere. Nearly has quiet here! we could do with some positive news on planning permissions, new potential sources etc...
My family have held Goodwin for 50 years this year, not a share to own if you want a constant news flow! or a chat with others on this BB! but look forward to the finals to see how all is progressing - should be some interesting news with so many developments going on at Goodwin - hopefully all the investment will start to pay off with growth in profit and cash flow as they move forward.
Just a note to say that I sold out today at a small profit, for me the figures were a real disappointment and the future prospect of single digit growth in the two remaining divisions not enough to make up for the loss of profit from selling the travel arm. Anite has no debt (should have over £50m in cash now) and is making a profit and believes it's remaining two businesses will grow and also wants to grow by using the cash for acquisition. As always DYOR to make investment decisions and I wish those who hold all the best may meet some of you on other BB. bear
I agree as far as the US market is concerned but elsewhere gas prices are still high- but again like you not sure if anything worthwhile and profitable can come out of CET before they run out of cash. If you valued the other two parts to CRA (exc CET and the cash) with last profit of £1.7m (which they will struggle to but may match in the current year ) and a PE of say 10 the CRA would be 4p - if these two companies showed they had had growth potential then a PE of 15 would be fair so CRA SP of 6P.
If we are a meeting of LA: Losses Anonymous do we need to pair up with buddy mentors with emergency contact numbers in case we are tempted to return to our old ways and buy more CRA? or would we need AA mentors as well as we would probably have to be very drunk to buy more CRA?
I agree nothing is simple! except meerkats final words in adverts! I agree the oil and gas price have been linked in recent times except in the USA with the surplus that is non currently exportable going cheap. Once the USA can either use or export the surplus the price will more closely reflect global prices. Not sure the price of oil will drop drastically because of Shale oil/gas particularly with what looks like long term turmoil in some major oil producing countries unless consumption falls - global recession/ alternative energy supplies etc.. I spent some time in a third world country, they don't even bother to liquefy the gas as LPG they just compress it with a compressor connected off the gas mains then as CNC pumped into a tank often under the rear seat it felt like you were being driven around sitting on a bomb! I looked at an LPG conversion but my limited mileage meant it was not financially worth it so I'm stuck with paying twice as much per litre but good for you that you can enjoy 64p a litre.
Mike you must be one of the few old timers still holding who bought in when this company seemed to have dead cert credentials based on ' market changing technology'. But you are right it is sales we need, but more than that it is profitable sales with cash flow that are the golden grail. I have had some companies in my past holdings with mixed outcomes for 'great technology' several tanked but got bought up for their technology/patents several taken private again by the original pre IPO owners backed with private investment funds in all these cases I either just about broke even or made some profit (but after holding for some years it was hardly worth it) probably because I had brought all of them at low prices and well after most folk had dumped them having got fed up waiting. Several other companies got plenty of sales but couldn't make the sale profitable with good cash flow. I still hold many shares in one of them (av purchase 61p currently worth 3.5 P!!) I sell them off in blocks in the years I will need more than my annual capital gains allowance and so I use the loss to offset excess capital gains on my non ISA portfolio so at least I kind of recover 18% of my loss on my big mistake having concentrated too much of my portfolio in one place - it has taken me years to recover now I limit any investment to 10% for top class companies (75% of portfolio) and 5% max for the more risky ones like Corac. The good thing with Corac is that it has invested some of the funds raised in a couple of businesses now profitable and providing they can stop burning cash in CET it may not completely tank till such time as profitable sales can be made, if they can!
The growth in the effect of shale gas and oil in the USA is transformational - the growth in oil production means that the USA is slowly reducing it's dependence on imported oil particularly if it can reduce it's growth/need for oil. The USA will not be in a position to export oil (in substantial quantities) for the next decade. This oil is sold depending on grade at market prices linked to NASLC. This is doing wonders for security of supply and balance of payments for the USA. The big transformational effect is from shale gas - whilst the USA always used all the gas it could produce or import from neighbours mainly Canada it was not a buyer on the Liquid gas market it's use of gas was limited by what was available. The growth in shale gas means supply has overrun demand - even with all the conversions to run power stations/ chemical plants etc from oil & coal and some increase in domestic conversion as new gas grids have been laid/extended in cities etc.. This means that the price of gas in the USA is about 40% of what we pay in the UK hence the onshoring to the USA of high energy (gas burn) users such as chemical plants. NONE of this will happen in the UK any substantial shale gas production will go into the national grid at standard price any small outputs will either be used to produce electricity by companies similar to ALK or left untapped as being unviable. If substantial gas is found beyond UK requirement then the current gas pipes bringing inflow from Europe will be reversed and the gas sold into the European grid at standard market prices. Shale gas may improve our balance of payments, energy security, smooth wholesale price change but is unlikely to reduce the price of gas generally unless Russian/Norwegian/Med/ Central Asian gas supply to Europe starts to exceed demand. It is important for the development of UK shale gas that the price does not fall substantially making it unviable if it fell to the current price in the USA all shale gas development in the UK would be terminated.. For ALK a steady gas price is good because the price it sells most of the electricity it produces is forward fixed.
The Trading update in May seems to point to a meeting of market expectations (see below) so not really expecting the finals to move the price much either way - I think it's already in the price - however an indication that the Q1 is doing better than expectations may give it a nudge. Trading in the final quarter of the year was encouraging and reflected the improvement anticipated at the time of the third quarter IMS issued on 19 February 2014. As a result, the Group expects to report full year revenue and adjusted operating profit in line with expectations. Cash generation in the second half was stronger than expected due to improved working capital management. Group net cash at 30 April 2014 stood at £6.0m (31 October 2013; net debt of £6.0m). A strong final quarter ensured that Handset Testing achieved revenue in the second half broadly in line with the same period last year, as had been expected. Trading in Handset Testing was positively impacted by a number of the specific technology and customer-related catalysts identified at the time of the Half Yearly Report in December. This included the first significant benefits from the investments made in TD-LTE technology over the last few years. Network Testing and Travel continued to perform well. Both businesses had good final quarters and have achieved full year expectations. Within Network Testing there has been strong market demand, particularly in Asia Pacific. Additionally, the Genetel acquisition, made in July 2013, has performed well following a successful integration.
Baysil - USA shale oil is not not sold at $30 b it may be sold at a few dollars less than Brent as the price will be linked to NASLC (North American sweet light crude) price. NASLC In June tracked an average $7.5 dollars lower than brent however the USA is not yet in a position to export shale oil, as it is still a net importer of oil. It is US shale gas that is plentiful and cheaper which is what the Ineos refinery will be taking to reduce it's costs. Once the pipelines to export in the USA are in place and the ships are available to get it across the Atlantic. Possible the Murco refinery may use US shale gas to reduce production costs but if so may well need the LNG terminal next door. Personally I think the Murco refinery will be used by new owners to fill the gap in their portfolio - they have plenty of crude becoming available from their African assets which they have been selling and/or processing through third party refineries. By their full control of the supply chain they can get their costs down ( the new owners will have also have struck a lower wage deal/ change in working conditions with the workers plus accessed govt funds to get their costs down - same as happened at Ineos).
Hi Mega - I bought at 7.6p so at present not sitting on a big loss, I bought on a 'fair value' assumption that the two non CET businesses plus the cash was worth in that region, cash burn without progress will of course reduce that value. However without good news the SP is just going to drift lower under the weight of sales, I could sell and buy back later but normally when I do that I miss the boat when a share rises quickly. Whilst the SP for CRA shows up in my portfolio I have little interest until some news starts to flow, like you I wait with patience and trust you are having better returns elsewhere.
Just reading about Gervais Williams in Daily Telegraph online he manages the Miton UK Smaller Companies fund, which was launched in December 2012, it is now £175m in size with 1.9% in Alkane (10th largest holding) means he holds about £3.3m in Alkane about 6.5% of ALK shares - if the maths is correct then Miton is buying ALK as the last listing for them @ 22nd April on ALK website has Miton with 5.12% when they held similar size holdings to Hargreaves Hale (5.22%) and Alliance trust (5.12%) IF 6.5% then now second largest investor after Henderson Global Investors (14.64%)
Don't Goggle Corac because if you do the 5th search result will bring you back here to my previous post! It has been there that long 16 days without any further comments that it has become a permanent comment on Corac! So June is nearly over and so far England were pathetic, Murray is still there, an English female got through to the second round before crashing out and CET still didn't manage to sell anything - but they are having great fun sending dirty oil and water round a test bed. It looks like no news is well no news and the SP just slowly drifts lower under the weight of the constant share sales with just one buy of 511 shares in the last 9 days.
Just been looking over ALK website and have posted below their page on Heat pumps not sure I've seen this before but I do a lot of research on shares I am interested in it and the Grey cells don't keep it all! Ground Source Heat Pumps Ground Source Heat Pumps are a sustainable technology that extract heat from the ground or ground water and utilise this to heat buildings or supply heat to industrial processes. The vast quantities of mine water in abandoned coal mines are a source of nearly constant temperature low grade heat and can be suitably harnessed to heat the homes and office spaces in winter and cool them in summer. Heat pumps are one of the technologies that are being promoted as a renewable thermal energy by the government and are eligible for receiving payments from the Renewable Heat Incentive (RHI) programme. The key benefits of using a Heat Pump: Heat pumps typically produce at least 3 times more energy than they consume. This translates to efficiencies greater than 300%. Increase in income because of savings on fuel bills. Require little maintenance. Significant reduction in CO2 emissions. Potential to benefit from Renewable Heat Incentive scheme. Alkane has more than 32 km2 of acreage under licence to extract water from abandoned mines and is seeking to develop projects in these areas.
Not really Mag - the hope value of SG on ALK acreage was already in the SP before EDG, that hope value has just been transferred into the EDG shares ALK now holds. From the market reaction to the deal- reflected in the SP it would seem it has made no difference at all. Personally I think the extra possibilities for ALK in non SG that may come from the EDG acreage may provide quicker benefit to ALK - we know the costs/profits from non SG when exploited by ALK as yet we have no idea if/what the cost/profit will be from SG once EDG can access it or how quickly profits/positive cash flow will take. I am in ALK as a kind of split play I see ALK as being a reasonable buy at around 25 -30p for it's current business and prospects for it's growth, the rest is my punt on SG becoming viable.I am not interested in 100% shale plays like EDG et al the risk for me is just to great. In just the same way I ignore pure oil/mineral exploration companies preferring to buy in when they are producing profitably as well as prospecting my current conventional oil/gas play is Ithaca, I am out of all minerals at present.
Several have mentioned that ALK is a plodder - IT IS - but it was set up to be just that to find and exploit gas in coal mines, rubbish, and orphan pockets and then burn that gas on site to create electricity for sale. Life extension for some sites is created by providing STOR capacity (burning mains gas to provide peak power) often whilst waiting for a mine to rebuild it's gas flows or because the plant is to old to be worth moving elsewhere or because ALK has no where to move the plant to and better it is on standby for STOR than standing somewhere in storage. What we therefore need for ALK is more sites, for more electricity production from our ALK gas and STOR only to monetise unused equipment (many companies are closing/disposing of STOR capacity as it is not financially worthwhile maintaining the sites if they have no other function). ALK has sought to exploit non shale gas on it's acreage but sadly several of the best prospects have been bogged downed for years in planning permissions. It is possible that EDG has some easily exploited NSG that would suit ALK to exploit and in the near term that would be more beneficial than distant - possible - blue sky - Shale gas. Excluding SG ALK is more than fully valued - PE well above fair value of 15, SP to NAV at 1.7 above good value of I, SP to sales of above 2 and with small positive cash flow covering dividend sub 0.5%. There is some 'Hope' value built into the SP for potential shale gas this has not changed by passing this on to EDG - all that has changed is that ALK may benefit from SG on a greater acreage if EDG can exploit it, EDG was always further ahead on this path than ALK as it is a SG play.
The big question then is who owns the shares held in Vidacos and were some of those bought out today?