Member Info for Bustard

We've had a wonderful ride and we know the fundamentals are excellent. Our hypothesis is being proven. It will take the time for the market to recognise what we savants have known for a while. And it's going to be bumpy occasionally with periods of rest and maybe even small retreats. But that's the nature of the stock.

But I believe we'll see this share very comfortably over £1 by this time next year and if gold continues rising, we could be in for a bonanza.

💪🏻☺️💪🏻☺️💪🏻☺️

It’s certainly a money printing machine

The intra-day fluctuations in the stock price puzzle me. It’s as if. around the current price, buyers match sellers, but quite why we see such substantial ups and downs within a day I have no idea.

My mistake is to look at the share price too often😂

I’m heading to Bolivia Fishing next Tuesday – deep in the Amazon jungle. Hopefully, I won’t be able to look at the stock price for a week.☺️☺️

Thank you, Mike.

I’d pencilled 325000 ounces for ‘27 so we’re at the same spot. Will be fascinating to see how the company’s production forecast updates go over the next 12 months.

It’s marvellous that such a high proportion is tailings.

Waste recycling. The company could make more of this in their presentations.

If gold were to average $4250 per ounce in 27 (and in truth, who knows??) my model suggests a pre-tax profit of $0.75 billion; post tax over $0.5 billion.

That would justify a share price north of £2 per share on an undemanding PE of c.8.

Of course that’s a long way in the future with lots of ifs and buts, and proof in the pudding, etc.

But it demonstrates why this is such an interesting and potentially profitable ride.

Thanks Viable.

I appreciate you posting these interesting links. I hadn’t read this.

Does anybody know what proportion of our estimated 275,000 ounces of production in 2026 comes from tailings as opposed original underground mining?

How strong sense and what evidence do we have for production in 27 and beyond?

I’m already starting to think about the financial year following the one we just entered☺️☺️.

As long as the gold price can hold somewhere where it is at the moment, if we get production rising yet further, the profits will be tremendous.

Any uplift in the gold price will be a major bonus.

I don’t know what other gold mining companies are similarly focused on tailings? Is this an unusual strategy PAF is pursuing or common amongst a number of the miners? I don’t even regard it as mining; it’s more like waste reprocessing , where it is known there is something incredibly valuable in the waste.

The shares don’t change, it’s the market on which they trade that will be different.

From a legal perspective, you will have exactly the same legal shares (under the company’s memorandum article articles of association) as you had previously.

It’s just the where you trade them will be different.

That’s what I understand. Happy to be corrected.

But some institutions are only allowed to hold or short shares on one market or another. It’s simply the rules that they’ve adopted and that they tell their investors.

Our moving from one market to another means there’s quite likely to be a bit of churn in our shares when we switch , not least because hopefully institutions that weren’t allowed to hold AIM listed share but are allowed to own Main market listed shares,

will be keen on buying us.

That’s what we need to hope.

As for Srroe, I don’t imagine this switch will affect them unless they have restrictions over what market they can hold shares.

Presumably when PAF moves to the main market, the reverse phenomenal may occur? Presumably the company will be in some index or other. And new institutions will begin to buy. Maybe be some, knowing this , are who picked up this trench of shares?

Incredibly well.

It’s a mug’s game trying to guess stock prices in the future.

If Mike and I are somewhere near correct for a post tax ‘26 profit of $350 million, and this were the profit into perpetuity, then a PE of 8- 10 ish might be appropriate. I can’t imagine it being much higher.

This might imply a share price of around £1.35 if my maths are correct.

But that is only likely to be achieved once the $350 million type post tax profit looks in the bag.

Of course, if some of the company’s other strategic plans come to fruition, and the volume of gold produced continues to rise, then this will underpin a higher rating. But it’s hard to imagine the market will attribute that valuation until the pudding has been proven.

A year or so ago, I thought it was obvious that the shares were going to substantially increase in value, and that it has proven. Do I feel as if a similar doubling is likely over the next 12 months?

No, I don’t.

But it’s worth stressing that gold mining is a strange business. PAF have no influence whatsoever on the price they receive for their product. This is unlike almost any other sort of company. All we can do is dig, refine and then sell at a price over which we have no influence . My point being that the gold price, which we have no idea where it will go, will be a very significant influencer of value of this business. And that’s the gamble we’re all taking, Especially as the stock price has risen so much over the last 12 months or so.

The immediate easy money has been taken

That said, for reasons that I’ve articulated previously, I remain a holder of shares in this company which I like a lot, because:

Excellent management

Their strategy

Their execution

Their diversification

The potential for a takeover

The operational leverage we get in terms of profitability from rises in gold price – (although that is very much a two edged sword ).

I’m old enough to remember the gold price boom when it went to £100 an ounce and more in the 70s, while I was in university. The one thing we can be confident of is that Au will continue to rise steadily over the years, but unquestionably will have big ups and downs. And its that volatility which means that the miners are always even more volatile, and tend to trade on unspectacular PEs. Operational leverage means their profits soar with rising gold and tumble with falling gold. But there’s no doubt if you get your timing right, you can make a lot of money from miners.

But for me, there’s something also a bit more special about PAF. I’m impressed with management and the way they have handled the unquestionably very tricky political, economic and social situation in South Africa. The diversification into Australia at a bargain price seems to be to be a strategic masterstroke. And they don’t seem to be foolish with crazy acquisition plans.

There’s an excellent story building, as Mike notes below. Each of these events should help bolster the price. It’s easy to get carried away and I’m a bit of an optimist so I have to be careful and managing my emotions. But PAF has all the feel of a long-term successful business , which will continue to grow, albeit with that gold price volatility effect.

I also think the company is a prime takeover target now it’s reached a sensible size. So hold on in there, I say.

My walking trip was fantastic, thank you. I only wish we could share some photographs. And then to arrive at Heathrow half an hour ago and see the share price just shy of 90p was as nice a welcome home as I could’ve asked for. Tajikistan There’s a fascinating country. A bit like Switzerland must’ve been a few hundred years ago, although much more arid and no forest. But spectacular snow capped mountains. The puzzle is the capital, Dushanbe, which is surprisingly prosperous with lots of Range Rover and Mercedes, and brand-new buildings. Where the money has come from you can only wonder

We’ve had an extraordinary run over the last few months and this cannot carry on indefinitely. But if the figures we have forecast for next the year after are anything like correct, the long term trajectory can only be upwards. But this will take time to prove and only then will the market truly become convinced in the value of the business. My own guess is that we will see further modest growth in the share price over the next few months, but there will also be some disappointing corrections. That won’t be the time to lose one’s nerve.

It’ will also be fascinating to see how the move to the main market plays out, and the price of gold is also bound to have an effect on valuation.

So buckle your seatbelts and enjoy the ride. I’m committed to sitting tight.

Thanks, Mike.

Yes, excited about my trip into the mountains. The highest one here is over 24,000 feet, though I won’t be near it.

Thanks for looking more closely at the inventory figures. I agree that you’ve put your finger on the answer.

Nice to be heading into the mountains with the Price at an all-time high. Not sure when I will be back; might be as much as a week.

I wonder if we’ll see a nine in the price soon? It’s certainly got some momentum at the moment. Purely instinct, but I think this has got a lot to do with the move to the main market and institutions which haven’t previously been able to hold starting to build up positions. When they do their sums they have to come up with answers like ours.

Cheers

Mark

Thanks, Mike, for running my figures through your model. Essentially identical result.

I’m still puzzled by the Inventory levels which have risen from $16 million-$39 million per the consolidated accounts released last week. This despite production of gold and sales of gold being virtually identical during the year at 197,000 ounces. Other words, what we produce we sell, with no stockholding. Assuming inventory is valued at the lower of cost and net reliable value, what has caused the big increase? The Australian acquisition? I suppose it would be interesting to know what is included in the category “inventory”

I’m in Tajikistan at the moment – about to go walking in the mountains for a week. Promises to be very interesting. Never been here before. Fascinating to see what’s happened to the share price when I get back as I definitely will be out of mobile signal.

Hi Mike

I suspect my model is not as sophisticated as yours. But using. Average gold price of $3650, AISC of $1650 and sales of 275,000 I had a profit of $356 million. I applied 10 or 15% hikes to overheads depending on the category. Wasn’t sure what to do with royalties and took a guess at interest and assumed a similar tax rate.

I can’t recall the figure off the top of my head, but I seem to recall the company was holding a substantial stock of gold at the year end, presumably valued at the lower of cost net realisable value. Presumably that could be sold quickly and generate a bumper profit. I’ve no idea whether the overall gold stock holding is higher than is necessary? Whether gold was not sold in order to keep the profits back?? I shouldn’t have written this note without checking the actual figures, but it’s worth having a look.

Takeover?

This point has been raised by several of us over the last year or so. It must be a possibility, especially if the “forecasts” being put together by some of us here are anything near the correct answer.

It’ll be interesting to see the next broker reports. Berenberg always seem incredibly cautious to me; even with this latest upgrade, it’s a step at a time for them.

For what it’s worth, I’ve been on this horse since 10p and been buying all the way up. Never sold one share and don’t plan to for a good while yet. The ride has been bumpy, occasionally dispiriting, but always generally in the right direction. I’ve thought PAF was a good buy at much lower gold prices, so the current $3600 or so is a huge bonus. If the sort of forecasts some have been noting earlier in this chain for 2026 are anywhere near the mark, then the share price can only go upwards.

(Incidentally, I’ve had my fair share of successes investing, and a few disasters…….).

Don’t worry about index constitution. It’s a side story.

By far the bigger influence on our stock price will be incredibly strong fundamentals combined with an appetite by more institutions to buy our stock once we are listed on the main market in London. And all this in the context of the booming gold price.

London market may not be what it once was, but it is still pretty strong and I’m certain there will be more buyers for the stock once the switch from AIM happens. I’ll be astonished if there are not two broker reports in the pipeline to coincide with the switch; management aren’t fools and the tenor of the CEO statement earlier this week was very much “This is a great company to invest in.”

Sit tight. Expect a few bumps. But the trajectory is firmly upwards as long as gold price holds up and we’re not hit by the unexpected.

Patryk - as Wolfi says you need to look at the market cap of HOC, which is very similar to PAF. But they only have a roughly one quarter of the number of shares in issue. So to compare the share prices you need to adjust by four or ¼, depending on which share price you are adjusting.

I agree 100% on volatility, Mike. I should’ve added this to my previous comment.

This has been nothing but a bumpy ride, and surely will continue to be so. And fluctuations in the gold price will inevitably affect the stock price in either direction.

I am probably being a bit optimistic in terms of the pace at which they share price will rise. It may well need the proof of our hypothesis coming through in the six monthly figures before it’s properly ignited again.

Another point to note is that the move to the main market will presumably be supported by two new broker reports and surely they will do the same maths as us? And thus a whole new slew of potential institutional investors will look at this stock for the first time. Many are forbidden from holding aim stocks. Given the hype around gold at the moment, you couldn’t ask for a better conjunction of the stars in terms of giving the stock price an upward bump.

But as we keep saying, lots of ifs and buts and maybes.