Member Info for Caposoka

Skid - mid Jan, Q4 Trading Update. Being the final quarter, it should include 2018 guidance, cash/debt levels as well as production / shipping figures.

.... obviously not. I put the drag on SP down to KMR entering a debt repayment and capex investment phase and shareholders concern on when / how they will get a cash return on their investment as opposed to simply growing the value of the company.

So not only poor sales prices but now we're going to be whacked by massive demurrage costs too... great.

Charlie Mills, drummer, Skid Row. #perhapsnot

Supaman, I well understand your post and sentiments behind it. Share the same views but it is also a question of shades of grey. By year end, net debt will be small. Repayment of 100M debt staged over another 3+ years. Cash is already available for WPC B upgrade. Slightly further down the track, further cash generation should allow expansion to proceed without new debt. So, it is a question of whether to pay off debt ahead of schedule, distribute cash in dividends or invest in the future. Personally, due to need to tackle falling grades, I prefer retaining majority of cash in business for investment but with a symbolic dividend to give encouragement / reward to existing shareholders.

a shortened version of this investor day presentation from last week, from which I understood that J-A's grades tail off quickly - hence their upgrade project (AUD 40M) to keep up production. I didn't fully realise before this version how high the HM grades are at Balranald (ave 31.6%) but also that they are so far underground - requiring drilling / not open pit operations with all the cost that implies..

Iluka's TZMI presentation..... http://www.iluka.com/docs/default-source/company-presentations/171115_tzmi-presentation-by-m-blackwell.pdf?sfvrsn=6

Contango, Cash costs have fallen impressively - yes, but the easy wins have been taken. Look at page 23 of the Hanan report referred to on this BB on 16 Oct..... Cash costs will rise steadily from the current low no matter what expansions programmes are put in place, due to falling grade and/or capex feeding into increased depreciation to maintain/improve output. By 2021 cash costs/t forecast to be in 150-170 range vs current 130/t depending on capex option chosen. Don't follow your comment re amortisation of existing loans over 9 months. The loan re-payment programme is 9 instalments from Feb 18 to Feb 22. Cash required over this period will be 100M for loan repayment plus 15M for WPC B upgrade plus 90-100M for expansion programme (WPC C). Positive cash generation forecast to cover this without need for other loans. The are amongst others, execution / cost risks, China's housing / credit cycle risks to future sales prices etc etc so although I would like a dividend for symbolic reasons, I can see KMR erring on side of caution until capex programme well underway.

I would suggest taking more of a market overview than looking simply at Lomon. Page 20 of ILU's recent presentation is worth looking at. 2016 Chinese pigment production - 100kt chloride, 1,800kt sulfate pigment. (Available capacity 230kt, 2,600kt respectively). 2016 China chloride feedstock production nil, 60-70% self sufficient in sulfate - these figures being prior to environmental crackdown and on-going nascent re-balancing towards chloride pigment.

Interesting read - quite a lot of info on industry / outlook. Kenmare upto 6% world supply of Zircon. Also existing mines declining by 25% over next 3 years. Kenmare remaining at 8% world supply of ilmenite ILU have reduced debt facilities considerably (down to AUD 712 from close to 1bn) - sign of confidence in cash flow generation / failure to achieve KMR T/O. Interesting to see J-A grade decline. ~7% prior to idling, J-A South at 6.5% til H1/19, then down to 5% and then down to 2.5% from 2021 onwards. Implies much higher production costs / need for capex in S.R, .Cataby and Balranald. Good summary of new projects coming on stream in future years (pg 23). Shows Zircon prices have only risen thus far to Y2015 prices, but future looks good (pg 29). Metalysis has really fallen off the radar (impairment charge coming)!!

Good find. Original Portuguese version - http://www.folhademaputo.co.mz/pt/noticias/nacional/kenmare-resources-vai-explorar-novo-deposito-de-areias-pesadas-em-mocambique/ (The English version is a word for word Google translation so nothing new to add).

Not sure the on the last point your making - the health of a company's debt level depends on the ability to service and ultimately repay the debt - so not sure the comparison in absolute terms between companies is particularly informative. General outlook and commentary is all good though.

http://www.fool.co.uk/investing/2017/10/11/2-small-cap-growth-stocks-that-could-still-make-you-brilliantly-rich/ Recovery potential Also reporting on Wednesday was producer of titanium minerals and zircon Kenmare Resources (LSE: KMR). The company�s third quarter was another record three months for its ilmenite production and this keeps it on track for its highest ever annual production. Chinese demand for ilmenite is improving again following a slower period in recent months. And with the zircon market having performed strongly and further price increases anticipated in the second half of the year, the company�s outlook is relatively strong. Looking ahead, Kenmare Resources is expected to move back into profitability in the current year. In 2018, it is forecast to almost double its earnings, which puts it on a PEG ratio of just 0.1. This suggests that now could be a good time to buy it ahead of what may prove to be a period of improving investor sentiment as the market begins to price in its improved financial performance.

I banged on a bit about low grades today but I am actually quite happy with the key management decisions that appear to be happening: a) targeting a 'poor' area on the mine path to produce less when shipments were clearly going to be less seems ok to me; b) upgrading zircon circuits / improving zircon quality into a tightening / rising market outlook seems ok to me; c) investing USD 16M to increase WCP B's output by 20% seems like an easy-win. My glass remains half full.

Lower grade was in the mine path - ok but 4.15% grade is still a record low. I haven't checked pre Y2013 but they were targeting higher grades during start-up Traditionally the mine path targeted higher grades in Q4 to build-up stocks in advance of Q1 rains. Given commentary on the rationale behind the WCP B upgrade this is something to keep an eye on going forward.

Yes and no. Production was low (your post yesterday expected record production). Ilmenite production held up because they used up intermediate magnetic stocks but zircon now at low end of guidance for the year. Ultimately poor dredging conditions and low grade in Q3. Pricing guidance was positive but within an improving, tightening market, I thought the commentary was pretty low key, especially compared to others. Nothing to give real excitement. So, another Q ticked off, cash generated and another step on the road. Q4 will be much better.

Not too good. Sales - low, affected by TSV dry docking but also adverse weather. Production - low, poor dredging conditions combined with low grade 4.15%, upgrading zircon circuits. Typical KMR presentation - "ore mined up y-o-y by 9%" (not mentioning that Q3/16 was a poor figure and in real terms it was significantly down on Q4, Q1 and Q2....why not just say it how it is...) Only positive for me is the decision to proceed with WCP B upgrade (cost USD 16M).

Positive coverage all good but the article itself is one of the worst researched I've seen... "operates as a mining company primarily in Europe, Asia, the United States, and internationally" "true value of $7.77, at a price of $3.15" (note - USD not GBP) "its debt relative to equity is 13%, which has been declining over the past couple of years signalling its capability to reduce its debt obligations year on year"

are we still on wife jokes?? :)

monitoring can work both ways so agreeing not to works for us :) Got approx 60 on the go so think there are several out there but KMR looks a good investment from here. Problem is I've been thinking that for 4 years :) but think we are getting there...