Member Info for cautionyourblast

Nice PGM price charting function on the JMAT site.

http://www.platinum.matthey.com/prices/price-charts

Look at this, the cash pile and the recent quarterly operational RNSs. Suggests an ex-cash PE of about three at current basket price, I believe (back of fag packet calculation only). Bonkers.

Many thanks, NtM! Your posts are always thoughtful and thought-provoking. You’re one of the (very!) few I seek out on the BBs for their current views and insights.

Hoping SAVE does in the next two years what this did in the last two! (Sorry for off-topic, everyone else)

Best wishes,

As a reasonably long-term holder, here are my current thoughts:

1. Rh seems to have stabilised (for now) at a price which would deliver bumper returns going forward.
http://www.platinum.matthey.com/#

2. Perhaps Samancor are selling...but there have been no RNSs on this so they can’t be doing *so* much (if any), though we know that they have been reducing their position over time.

3. Historic PE for 2020/21 ex-cash must be well below 4 (unless mgmt book an asset write down like they did in 18/19). Dividend announcement should be interesting (again) this year.

4. Profit taking and market makers may well be a big part of the current move.

5. Current events in SA are depressing but unlikely to have a long-term drag here (though one-off issues of theft and vandalism have been known to occur for SLP).

6. Maybe MMs know something the wider market doesn’t but this is a typical bulletin board theory, so I tend to discount it.

7. Shares in my portfolio don’t always do what I’d like them to do.

8. Maybe there’re unknown unknowns coming up in the year-end numbers, but that would be out of character from a conservative and communicative board of directors which has integrity.

So I continue to hold (have sold maybe 15% of my position at an average of maybe 120ish). No plans to sell at this level. Looking forward to the Q4s.

Thanks, GettingBy. That Lyn Alden piece is superb. I have read it twice now.
Worth reviewing, Savannahites...

Thanks, SoG.
I found resolutions 4 & 5 somewhat difficult to follow, but am thinking that a 30% dilution via a placing to Instits is possible under resolution 5. Like most others (I think) I am happy if that occurs provided the acquisition is value-accretive to the larger group...which I am very confident that it will be.

I've read and re-read the AGM notice and have found it quite hard to understand. Perhaps some of you clever people will have a view.

I believe the explanatory note on res 5 effectively allows 30% equity to be issued under a placing to institutions (i.e. without application of pre-emption rights). I reach this conclusion because of SJ's use of the wording "...and (ii) otherwise...".

In the explanatory notes on res 4 it is stated that there is no intention to make such an issuance of shares under res 4 (an ordinary res) at the date of the AGM notice (4 June, after the announcement of the proposed ChadCam deal). However this wording as absent from the explanatory notes for res 5 (a special res) leading me to think that perhaps there is intention to undertake a placing for up to 30% new equity if the special res 5 is passed.

I may have misinterpreted this. But, if I'm right, could it be that this is the basis for part of the raise on ChadCam (and perhaps Niger)? Clearly there's a pile of jigsaw pieces to square away before the proposed deal goes irrevocable (sale and purchase agreement; government approvals; potentially Niger funding; bank approvals; stock exchange rules; potential refi on Accugas (despite it being non-recourse to TopCo) simply to lower the finance costs to P&L; etc. Perhaps squaring away the approval (from existing shareholders) of issuance of additional shares under a placing is being done now so one more thing is ticked off the list as part of this complex transaction process. The last thing management want is to get everything approved subject to shareholder approval and then find a key resolution gets blocked (for whatever reason). The notice states that the existing resolutions in place will expire at the end of the 2021 AGM so they can't rely on what was passed last year.

So, with some interpretation and assumptions, I'm wondering if we're in for a institutional placing of up to an additional 30% on top of existing shares and then debt to make up the balance of what's required. I am ok if this were to be the case. I am cautiously excited about where this share goes in the next couple of years: I think mature shareholders will see that as a reasonable timeline for a start.

Do you think this analysis passes muster?

Best wishes all.

I thought this to be quite unusual and extremely impressive. Instits with and eye on climate change and poverty alleviation should see this very positively indeed (provided their thought process is more nuanced than the XR people).
Do we need a full listing (i.e. get off AIM) to attract more of them in?

Well done, AK.

This is an interesting little summary. One wonders if resurrection of the project might be in the longer-term plans (assuming of course that the deal goes ahead!)
https://www.gem.wiki/Niger_Chad_Oil_Pipeline

Great post (again) ZENGAS: thanks.

This article is old, but interesting:
https://cameroonpostline.com/niger-to-plug-into-chad-cameroon-pipeline

After the recent horrible events in Mozambique, this is especially good news. Well done Soraya, Lars and team.

I continue to believe that this share will handsomely reward patient investors.

Best wishes, all

This is from 2012, but has a map of the pipeline and perhaps may have some other items of interest. I've yet to read in detail.

https://corporate.exxonmobil.com/-/media/Global/Files/locations/Chad-and-Cameroon-operations/performance-data/project-update-reports/32-all-chapters-english.pdf?la=en&hash=04C790DC47173784E213F5F42EB92EC9E47385B8

Very little in the 2020 Exxon financials on Chad and Cameroon.

This link provides a bit of background. https://en.wikipedia.org/wiki/Chad%E2%80%93Cameroon_Petroleum_Development_and_Pipeline_Project

Chadian president recently killed, as some of you may be aware. His son is now apparently de-facto leader.

https://corporate.exxonmobil.com/Locations/Chad-and-Cameroon

Equity cash raise with pre-emption rights for existing shareholders? Placing with institutions only? I guess I should just be patient and wait for the next RNS.

With hindsight, this may be why it was tricky getting the 2020 financials signed off: a significant post balance sheet event needs disclosure.

The Accugas restructure must be done as a condition precedent, I would imagine. That said, this appears (if it goes through) to be a fundamental bolt-on which changes the business. Thus being deemed a reverse takeover.
Exciting...but I agree they'll need a few bob.

wow! So there was something happening behind the scenes!

I was encouraged by Friday's presentation, though (perhaps like others) I had assumed that a post-the-bell presentation perhaps meant a more significant corporate event. In the end, I'm glad this wasn't the case.

The focus on ESG was particularly good: Instits take this stuff v seriously and clearly Steve Jenkins, AK et al have understood that and are treating it with respect.

Two things stick out enormously from the financials for me when compared with everything else:
(1) the deferred revenue (not all the gas got "taken" under the TOP contracts). So fro 2020 there's cash in the door of USD236m and realised revenue of USD169m: that's a huge difference. The notes on revenue recognition are helpful to read here. The long note in the 2019 financials (p120/1) I found rather confusing. So we've got revenue yet to book which for now increases liabilities (but is obviously cash neutral when we book it cos we've had the cash already).
(2) Finance costs are a whopping USD59m. This is why the rating and refinancing of Accugas is key. AK's comments here were v encouraging. He expects a big improvement in the interest expense drag (though understandably wouldn't be drawn on the rate).

Point (2) here got me thinking on Niger. I know he has previously said that he doesn't want Nigeria cashflow funding Niger capex, That said, it must be hard to raise the USD70m for Niger when the other limb of the business has such a huge financing expense drag on the group. I know he said that Accugas debt isn't recourse to Topco, but imagine that you're a bank going to credit committee to lend to the Niger project - you're going to need better security than what's on offer in the desert and the independent reports on reserves, I suspect (happy to be corrected).

I find Andrew a bit hard to understand at times: I *think* he said that Niger awaits USD70m funding which is expected to generate 5kboepd, which will go through pipeline not truck. If so, I could guess that the payback period is less than two years given current crude prices. Again, please do correct me if I misheard/misunderstood on this.

So (if I'm right on all this) then an Accugas credit-rating and debt restructure potentially unlocks Niger works too.

I was a bit annoyed that the loss after tax of USD6m was buried and not mentioned: just say it - we want the full story!

Like many of you, I'm excited about future prospects (FIPL starting to take gas after maintenance complete, new customers (15% of Nigeria gas is a "relatively straightforward target"), debt restructure, Niger progress, etc.

This is my second biggest position (after the mighty SLP).
Best of luck and best wishes all: thanks to the many posters who make this BB great.

It's time to play the music
It's time to light the lights
It's time to meet the muppets
On the muppet show tonight...

Same here, Ghastly

http://www.platinum.matthey.com/