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I’m confused as to why anyone would be buying into this share after the absolute info given previously and today, that shareholders are being left with nothing when this exits ch11.
Can anyone explain the bull case under current circumstances?
A company pays dividends out of cash they have in the company/ Just because they haven't paid a dividend doesn't mean they have a specific amount of extra money. Your understanding of corporate finance and cashflow is a bit flawed on this one.
Popped in here from Telegram to see what's being discussed and I see the resident loon is STILL overwhelming the board with rants and weirdness. There is a saner place to discuss if you want it, on Poly London group on Telegram. Good luck in here!
Well done, you read things on the internet.
In 2022, EVRAZ sent a record amount to upgrade equipment at the Kachkanarsky GOK. Investment amount - 2.8 billion rubles
During the year, 7 BelAZ dump trucks with a carrying capacity of 240 tons were purchased. Three are in operation at the plant, and four more will arrive in the first half of 2023.
We purchased two NP-1 traction units and dump cars for transporting ore from open pits.
Three excavators were bought to load the rock mass: two with a bucket capacity of 12 cubic meters, the third - EKG-15 M. Two drilling rigs SBSh-250/270 were put into operation, in July 2023 the delivery of the third is planned.
We purchased two front loaders, a bus, crane cabins and an overhead crane, and auxiliary equipment.
“In 2022, despite the increase in equipment prices, we purchased a record number of units for the Kachkanarsky GOK ,” said Denis Novozhenov , EVRAZ Vice President, Head of the Ural Division. “In 2023, the renewal will continue: we will buy crushers for factories and another excavator with a bucket capacity of 20 cubic meters.”
It is quite likely that after the company redomiciles that it will delist from LSE and relist on AIX, but we're waiting for clarification of the plan from the company
@Otis you're welcome for the info. I wrote it up after talking to IR with queries and concerns pulled in from lots of PIs. Hope it helps!
The situation changed in November with sanction changes - Computershare couldn't offer Depository Interest after that by the sounds of it, so that restricted options
Honestly, this article says it all https://seekingalpha.com/article/4573403-polymetal-stock-buy-the-dip-reiterate-buy
11. Q. Would you take into consideration the ability for UK and other shareholders to trade on AIX or is that the reason for considering the GDR?
A. That’s why GDR. If the company has to move to survive, it has to move.
12. How will voting/corporate actions on these issues be handled? Will a minimum number of voting shares be required for a valid vote?
A. A minimum of three shareholders is required. The company will do their utmost to reach shareholders and empower them, but it does come down to shareholders wanting to vote. If you don’t vote, you’re not being heard (my voice there)
Other matters
13. Q. Would you be interested in hosting a regular Zoom call for retail investors? Monthly? Limited numbers? The purpose would be to field queries and keep an up to date information stream running during these difficult times. It might save a lot of individual phone calls and emails!
A. Potentially they would use Investor Meet Company, however there is a problem with selective disclosure that makes this sort of meeting impractical. You cannot disclose key information to a limited group who could act on that. The company is creating a FAQ to cover a lot of these queries and will be updating through the normal channels when they can. They are aware a lot of communication is needed.
14. Q. Do you join Polymetal related Telegram groups?
A. The IR team do join various channels of chat regarding the company including Telegram, Reddit and other BBs etc. This is purely to be aware of issues of concern to the investor community and is for listening only, as per selective disclosure.
15. Q. Why have the management and BoD not been buying shares at the very depressed price point?
A. There has been some purchasing in the last year possibly in the regional management, but that was probably on the MOEX. Possibly there is a feeling it is unfair for BoD to buy in say LSE when other management can’t. I guess this one was hard for EM to comment on.
16. Q. Do management, BoD, Alexander Nesis hold share on MOEX, LSE, AIX?
A. See 15. The BoD and management in various jurisdictions tend to own shares in those jurisdictions. The long and short being across the company they own on LSE, MOEX and AIX. Alexander we cannot comment on.
5. Q. Would you continue with a redom or listing change even if it was disadvantageous to a group of shareholders i.e. ISA users, UK holders, Russian holders, etc?
A. The company has to survive and has to do what is best to make that happen. If that is a problem for a minority group of investors, then they will have to work round the issue. The company has to do what is best for it and the majority of shareholders.
6. Q. What is the pressure to move the listing from LSE? I understand the reasoning behind a redomicile, but changing listing just seems so difficult. There would need to be a huge benefit or a huge risk to make it worthwhile.
Q. See 2
GDRs and Shares
7. Q. What would the exact process be to move from LSE listing to GDR?
A. Yet to be confirmed but a timeline is evolving now. The GDR requires a provider who is currently onboard and discussions are continuing on this one. Information will come out when ready.
8. Q. Would the same ISIN be used, or would there be a requirement for a new ISIN on AIX and the GDR would use the new ISIN? Would the shares be able to stay within an ISA tax wrapper for example?
A. There would be an ISIN change from a JE number to KZ number.
9. Q. There is a lot of retail investor concern around ISA, SIPP and similar structures. Would Polymetal take this into consideration when making decisions?
A. It sounds like they’ve heard about this one a LOT. They are taking it onboard as a critical workstream and talking to brokers etc to find a route through. If it can be solved, it will be solved.
10. Q. What is AIX like for trading? I have looked at the AIX website and it only shows four companies trading ordinary shares there, one of which is Polymetal. Is this really going to offer the liquidity required for Polymetal? Is there a reason to consider that for a main listing? Have Kaz Gov offered any benefits to make that listing?
A. It’s a young exchange and Poly would be the largest listing there. It doesn’t really have the liquidity, but it’s the probable best option. The draw is the redomicile into the AIFC (I think this is correct) which gives beneficial tax and uses UK law, not Kazakhstan law. It even has UK judges. The point of such trade zones is to offer a safe, secure and beneficial location for foreign companies to come into.
Polymetal meeting 30/01/2023
General notes
This is not a direct record of the conversation, it is my summarisation. If I’ve misrepresented anything, my apologies to Evgeny and please don’t take this as anything other than idle chit chat. It is not a record of the views of the company, other than how I have interpreted my meeting.
Polymetal are creating a FAQ to be published on their website shortly, which will cover these queries in more depth and ‘officially’. Conversations like mine today and those with others have helped Evgeny and team understand what needs to get answered in that FAQ.
Internal/External Pressures
1. Q. Can you talk me briefly through how Western sanctions and Russian restrictions are impacting Polymetal?
A. From RF, not possible to move money around and out of Russian subsidiaries and no M&A in Russia – cannot buy or sell sites or resources in the country. A redomicile away from Jersey (unfriendly) to Kaz (friendly) removes this problem. From the West, sanctions have made it impossible to buy equipment and services and have other knock on effects such as difficulties with Computershare.
2. Q. Is there a problem from the RF point of view with Polymetal having an LSE primary listing? If a problem, how will that manifest?
A. There is no problem having a primary LSE listing from Russia or the company’s perspective but the company must redomicile to remove Russian restrictions. There is then a problem after redomicile. To maintain a primary listing on LSE if the company is headquartered in Kaz it must have a Depository Interest - https://www.gov.uk/hmrc-internal-manuals/stamp-taxes-shares-manual/stsm073000 - Up until November Computershare were happy to provide this, but currently they are not which means if the HQ goes to Kaz then the listing needs to move too.
3. Q. Is there external pressure on Polymetal to make a decision regarding redomicile or share listing changes? Pressure from IIs? Russia? Time? Sanctions? Other?
A. There is no immediate pressure other than that noted above, but the situation is evolving and the company’s hands are currently tied. To be able to react to or get ahead of potential issues the company needs to be able to operate properly
4. Q. What is the II position on redomicile and changes in share issuance?
A. IIs are much more prepared and balanced in their views to redom and relisting. They did not have the surprise that RIs did after Wednesday and had an attitude more along the lines of “Why didn’t they understand this? You did tell them!”. That is not to say that there is not concern at moving off the LSE, as there is, just not the level of panic seen in RI.
I think that's another two steps down the line. Let's see what's proposed for the move to KZ, see what the process is around GDR and then we'll get to company splits and whatnot
"Couple of things at play here Poly need to re-dom so they cant split the company for two reason firstly the LSE would not allow the issuing of stock in company that is purely Russian assets and secondly Russia would not want a company listed in UK with Russian assets in an anti Russian jurisdiction."
This is still wrong. It's all about domicile location for Russia. They do not care about the listing.
1. Q. Can you talk me briefly through how Western sanctions and Russian restrictions are impacting Polymetal?
A. From RF, not possible to move money around and out of Russian subsidiaries and no M&A in Russia – cannot buy or sell sites or resources in the country. A redomicile away from Jersey (unfriendly) to Kaz (friendly) removes this problem. From the West, sanctions have made it impossible to buy equipment and services and have other knock on effects such as difficulties with Computershare.
2. Q. Is there a problem from the RF point of view with Polymetal having an LSE primary listing? If a problem, how will that manifest?
A. There is no problem having a primary LSE listing from Russia or the company’s perspective but the company must redomicile to remove Russian restrictions. There is then a problem after redomicile. To maintain a primary listing on LSE if the company is headquartered in Kaz it must have a Depository Interest - https://www.gov.uk/hmrc-internal-manuals/stamp-taxes-shares-manual/stsm073000 - Up until November Computershare were happy to provide this, but currently they are not which means if the HQ goes to Kaz then the listing needs to move too.
Possibly, but not necessarily - If they are an 'unfriendly' domiciled company they are heavily restricted in what they can do in Russia
The company can't move money out of Russia due to Jersey domicile, so they can't pay down debt with that cash. They can't sell or buy Russian assets for the same reason
"@blueburg...at their last presentation, POLY mgt did say that having primary listing on LSE is limiting their ability to do things in Russia and with Russia assets. "
This is incorrect. Russia do not care about the listing on LSE, they care about the domicile, the HQ location. So to operate usefully Poly need to redomicile. If they redomicile they need a Depository Interest from Computershare to maintain the listing on LSE. Computershare are no longer willing to offer that, so the primary listing has to go if the HQ moves. Hence the listing move to KZ.