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reapwhatusow - The refinance agreement reduced the interest rate on the Mezzanine facility and it will reduce once more when the Senior facility is repaid. The $3m debt repayment was made after the 31st March 2021 so interest bearing liabilities now stand at $117.5. The $12.3m Q1 2021 debt payment included the $7.3m payment that was made post Q4 2020.
Are you aware of the amount of tax that will be paid when the recovery period ends?
reapwhatusow - The two main shareholders are currently seeing $3.5m in interest added to the debt pile each quarter as well as receiving the debt repayments each quarter ($23.3m since the refinance agreement). The interest rates, previously, were 5% higher on the Mezzanine facility so they have reduced there and will further reduce to 7% when the Senior facility is cleared. If you think the interest rate are high have you not seen the tax rates that MTL will be paying? How are they costing themselves money with the low MC? They are not going to sell their cash cow so the MC doesn't matter to them.
Supertag - So don't watch it then. It's not like watching the SP will affect it anyway. If anyone has bought shares to trade, ooops but then that's the gamble. If anyone has bought shares to hold and wait for dividend returns then great news, the debt is being paid off and the shares are dirt cheap currently and looking to get even cheaper if you want to buy more.
The Navigator - "given his intimate insight on it's future" suggests inside knowledge so it puts the CEO in a difficult position. He may well be allowed to purchase shares but could then face accusations of insider knowledge. The risk of being accused of insider trading usually keeps people from buying and selling stock when there is a suggestion of insider trading. It endangers the stock generally and even if you win the battle, you still have to fight it out. The previous two director buys didn't help the SP.
Lee - If want a copy of the spreadsheet then ask Les for my email and I'll send it to you.
Lee - I've reduced the remaining quarterly debt repayments to $13m and that puts MTL making the final payment during Q4 2023 (previously it was Q3 2023 on $15m repayments per quarter)
Lee - I've reduced the payment figures to reflect the lower grades for the next 4 quarters ($11m per quarter) and we should be on track to clear the Senior facility in Q2 2022.
Manjung - The interest is accruing daily and compounding quarterly.
Lee - The Mezzanine facility was $65m at the time of the refinance (RNS Sept 11th 2020) Two quarters of interest compounded makes Mezzanine facility approx $69.7m at end of Q1 2021. All debt payments are currently to the Senior facility which I have now standing at approx $47.9m. My spreadsheet is $0.1m out because today's RNS has revealed that MTL can make more than one debt repayment per quarter (the Finance agreement stipulated one per quarter) so I can no longer calculate the interest accurately as we are not told when the additional payments are made which affects the interest accrued in each quarter.
maqsood7 - The last update took the SP to 2.4p which is nearer to 2p than 3p.
Can we have our next P&D poster please?
Thing is I don't think SP ever got below 1.45. Maybe posted on wrong board.
Did anyone spot Stavos23's buy at lower than 1.45?
Looking back at the previous two director buys the SP headed south from each one.
Shinfalls - I sincerely hope that you manage to improve your cash flow situation and remain invested. I hate to see distressed sellers.
After digging through some of my old research over the weekend I decided to review my original investment decision here. I initially became aware of MTL after seeing the director's dealing RNS (Jeremy Ayre). I did my research and there were lots of positives as well as some risk. Looking at the figures in the feasibility report it seemed that when the dividends were to be paid, shareholders would receive approx 0.5p per share with gold at $1250/oz and an AISC of $800/oz, producing 96koz of gold per year. At 4.55p per share it represented an 11% dividend yield on my investment which I thought was worth putting £10k of MTL shares into my SIPP on 19th July 2017. I spent over 6 months researching this company. I continued to add to my SIPP until I had reached 3m shares adding mainly in February and March 2019 for a total investment of £31k. With the risk of default and the risk of being taken private now gone I am now adding MTL shares into an ISA with my second lot of 140,609 shares bought today. They are showing up as a sell though.
Looking ahead, I have stated previously that I now expect dividends to be paid at 1p per share if gold remains at current levels and our AISC drops further which means that I now expect my SIPP to receive £30k per year in dividends for an investment of £31k.
So Jimmy, if you can, hold onto your shares for as long as you can. If you can't then I hope that your situation is only temporary and I wish you the very best of luck for the future.
Lee - Yes, the recovery period ends July '22 at the latest. Yes the period can by extended but I have no idea how likely that will be.
I think that our previous losses can be carried forward to lower our tax bill once the recovery period ends but that isn't my area of expertise (anyone got Donald Trump's number?)
Lee - Further to my previous post I have the following link that explains the my first point. It took me a while to find it as I had looked at it four years ago when I first invested - https://www.bakermckenzie.com/-/media/files/insight/publications/2015/02/primer-on-the-philippine-minerals-industry/files/read-publication/fileattachment/bk_manila_primermineralsindustry_2015.pdf
Page 17 has the relevant info.
I cannot find a link for the tax relief on the interest payments so I may have been mistaken so please ignore that as I cannot verify it.
Have a good Easter.
Lee - I see it as MTL has a tax holiday of up to five years from the commencement of production. Commercial production started July 2017 according to the MTL website. If MTL has recovered its pre-operating expenses and investment before the five years then the tax holiday finishes at that point.
MTL may get some form of tax relief on the interest payments. I can't find the link for that info but I'll post it when I find it.
OceanaGold were awarded the first FTAA in 1994 for their mine at Didipio but their Government share is higher than MTL's
Lee - Another key word . . . . . Location
MTL are located in the Philippines and are taxed differently to AAZ.
MTL still have the FTAA to kick in - https://www.lse.co.uk/rns/MTL/ftaa-approval-e2ed14cldfwhmzd.html
Lee is on track so far.
Lee - Hopefully MTL have exceeded 21,00oz as we are still ramping up to design throughput plus the COVID19 situation has improved and MTL produced record numbers last quarter when the COVID19 situation was worse. Coupled with lowering AISC we could see another $650/oz quarter heading to free cash flow of around $13.5m. Next debt repayment should be within next five working days as per finance agreement.
MTL needs to get the debt levels down asap before the FTAA kicks in next year.
Shinfalls - I think SP will start to rise probably after Easter in anticipation of another record quarter update (some of the Governments SEISS money may find it's way here as well to add to the boost). A spike on RNS release day and another slow retracement back to these current levels which is where the SP seems to be comfortable at.
If Roy is going to be selling his remaining 5 or 6 million shares before the quarterly update then the SP could drop lower.
Somebody mentioned Ruffer still selling shares recently. They had 101m shares notified 28th January 2019. They must have all been sold by now if that is their intention.
Interestingly, Baker Steel dropped below 6% threshold between 31st December 2019 and 31st January 2021 without a TR1 being produced. About 12m shares sold?
lovinglife435 - You beat me to it ;-D