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On Thursday, October 5, 2023, Moody’s credit ratings agency lowered Egypt’s rating from B3 to Caa1, which is a credit grade that indicates the presence of significant risks surrounding the repayment of the state’s sovereign debt. ✅
◼️ The downgrade of Egypt's credit rating reflects the deterioration of the government's ability to bear debt, and the continued shortage of foreign currencies, in the face of increasing external debt service payments over the next two years, according to Moody's. ✅
◼️ Thus, Moody’s rating is now two notches lower than that of Standard & Poor’s Global and Fitch, and Egypt awaits the next review by Standard & Poor’s on October 20, followed by Fitch on November 3. Both have a “negative outlook” on their ratings for Egypt, according to Reuters.
https://www.bloomberg.com/news/articles/2023-10-05/egypt-downgraded-by-moody-s-amid-dwindling-policy-options#xj4y7vzkg
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IMF says Egypt must devalue its currency further and quickly or Egypt's reserves will soon be gone.
What are the implications for Centamin ? Will it be able to operate if supplies are hard to obtain? Sure, more Egypt dollars for every US dollar received from gold sales - but if you can't obtain necessary supplies internationally - what happens?
🗣️“Gold mining as a development engine within emerging economies presents huge economic potential” – Martin Horgan, Centamin CEO.
A thought-provoking panel discussion on the future of gold at today’s
@FinancialTimes
Mining Summit.
@ftlive
#FTMining #Gold #CEY
short video link
https://twitter.com/CentaminPlc/status/1709969890981851526
More video on demand will be available on Monday 9 October here:
https://mining.live.ft.com/
1:20 PM - 2:00 PM GMT +1 / 6:20 AM - 7:00 AM Your local time (40 Min)
Panel Discussion: A Modern Gold Rush - Will it Continue?
Gold is often a safe haven in times of uncertainty such as the present moment. But what place does gold have in a digital world? And is gold’s role expanding in a “de-dollarised” world? This panel will explore gold’s role in the modern era and how it is evolving.
How do investors view the gold industry, and how is that shifting?
What is the sustainability case for gold?
What has been the impact of Russian sanctions and de-dollarisation?
Note: Mr Horgan is there as a speaker ( & director Marna Cloete albeit not as a Centamin rep) https://mining.live.ft.com/page/2313657/speakers
Also, Barrick's Mr Bristow is there speaking - so that makes 2 conferences where Barrick and Centamin's CEO's were present in the span of a month
Kareem Elkady
Administrator at Sukari Golden Mine
3h •
ما ينفعش تبقي مدير مسئول الا لما تفهم يعني ايه نفس بشرية بتتأثر بالسلبية و التقليل من الشأن و اللوم و قلة التشجيع.
متبقاش مدير إلا لمًا تفهم إنك مسئول عن نفسية الناس اللي شغاله معاك و تخلي معنوياتهم في السماء يا تنزل بيها ل سابع أرض.
متبقاش مدير الا لما تخلي الناس تصحي لشغلها و هي عايزه تروح مش شايلة هموم الدنيا فوق كتافها.
متبقاش في منصبك همك بس الشغل يخلص حتي لو علي حساب نفسية إنسان و تقطيمه.
خلي ده هو معيار نجاحك.
By:Azmi Gaber
#sukari_golden_mine
It is not useful to remain a responsible manager unless you understand what it means for a human soul to be affected by negativity, underestimation, blame and lack of encouragement.
There is no manager left unless you understand that you are responsible for the psychology of the people who work with you and empty their spirits in heaven or bring it down to the seventh earth.
There is no manager left except when you let people wake up to their work, and they want to go away, not carrying the worries of the world over their shoulders.
You don't remain in your position, but work is saved, even if at the expense of the psychology of a human being and breaking him.
Let this be your criterion for success.
B:Azmi Gaber
#sukari_golden_mine
https://www.linkedin.com/posts/kareem-elkady-ba6380190_sukariabrgoldenabrmine-activity-7116060342631174144-VXIT
Abdulrahman Mohamed and 8 others
----------------------------->>>>
As I follow news of Sisi's run for a 3rd term , it's clear Egyptian politics are a strange mix of pseudo religion, superstition and nationalism. I suppose in some ways Egyptians get out what they put in, which isn't great for their economy, unfortunately.
Tornadotony called it - incomplete data on market screener or just glitchy - whatever the reason this is the website data shown today:
Van Eck Associates Corp.
110,273,580 9.519 % 123 M p
https://www.marketscreener.com/quote/stock/CENTAMIN-PLC-9730915/company/
Centamin Shares Moved From Strong Hands To Weak16 Aug 2023 16:25
I see Siko's rebuttal to my posts about Egypt have garnered many 'likes'
I am glad Siko is still posting and setting the record straight about the facts on the ground
However, the bitter pill many private Centamin shareholders are refusing to swallow is that strong hands (institutional investors) have already made their decision to sell. Like I posted before the major shareholder info on Centamin's website is not up to date. Institutions that had held for over a decade have SOLD over 200 million shares. Now many of these shares are in weak hands. What does that mean? It means many new holders won't hesitate to sell when spooked. They are not in for the long term.
https://www.marketscreener.com/quote/stock/CENTAMIN-PLC-9730915/company/
Centamin's management (chiefly Mr Horgan) has faced a confidence crisis and lost the trust of many mining analysts/portfolio managers - one remaining of which is reassessing her position. Actually THE largest position (currently Centamin's largest shareholder) You can contact her yourselves:
https://www.linkedin.com/in/imaru-casanova-75b58b64/
I will not be surprised if in the coming days and weeks she decides (if she hasn't already) to significantly reduce her Centamin holdings (nearly 10% of Centamin's float). When this happens it will be just more bad news for Mr Horgan and the share price stability going forward.
Can things turn around? Yes! The Market does not have access to the information Mr Horgan has access to. Step out drilling, geophysical surveys, satellite deposit resource figures and grades, the legitimacy (or not) of the bonanza zone, negotiations with EMRA, negotiations with interested 3rd parties - all is not lost. Yet, Mr Horgan hasn't made the choices that pleased the institutional investors - and many of the unanswered questions I've raised over the last few years are still unanswered (or the answer is not favorable)
Imaru talks about her promotion to manager of the VanEck gold ETF group of funds here:
https://www.youtube.com/watch?v=QQ-8sNJeYlo
Aug 16th 2023 position
#1 Van Eck 110,273,580 shares 9.519%
Today (Oct 4, 2023)
VanEck does NOT even appear in the top 10 shareholder's list (see here)
https://www.marketscreener.com/quote/stock/CENTAMIN-PLC-9730915/company/
but, I don't know if it's possible to cash out that fast (note the other large shareholders on the list haven't materially changed) still , that might explain the drop in share price without 'news'
so that would mean VanEck now holds less than 16,623,000 shares - a sell of over 90,000,000
perhaps Centamin PR can advise ?
The technical term is called a 'commitment fee' and it was $ 1,200,000 for last year
details from Annual Financial Statement below:
2.6 FINANCIAL INSTRUMENTS
Interest bearing loans and borrowings
US$150 million Revolving Credit Facility (“RCF”)
On 22 December 2022, the Company entered into an agreement for a US$150 million RCF with four banks: Bank of Montreal (London Branch), HSBC Bank plc, ING Bank N.V. (Amsterdam Branch) and Nedbank Limited (London Branch).
As at 31 December 2022, there were no drawdowns on the facility and therefore no interest expense was recognized in the period. A facility establishment and commitment fee of US$1.2 million was recognized in the profit or loss statement.
The terms of the facility imposes certain financial covenants on the Company in respect of each Relevant Period that has an outstanding borrowing as outlined below i.e., the Company shall ensure that:
a) Interest Cover: Interest Cover in respect of any Relevant Period shall not be less than the ratio of 4:1;
b) Leverage: Leverage in respect of any Relevant Period shall not exceed the ratio of 3:1;
c) Liquidity: Liquidity shall at all times exceed US$50,000,000; and
d) Reserve Tail: at each Scheduled Reserves Assessment Date, the Reserve Tail Ratio is not less than thirty per cent
Typically the undrawn portion has a commitment fee of 35% of the applicable margin (0.8% based on currently applicable margin) i.e. $150,000,000 x .8% = $1,200,000
And for those wondering what a reserve tail is :
Reserve Tail means, with reference to the Development Plan and the Financial Model, the amount of Mining Reserves remaining to be produced as of the Maturity Date expressed as a percentage of the sum of (i) the Mining Reserves already produced at the Project and (ii) the Mining Reserves to be produced as of the relevant date of determination
Dictators and thugs, every one. Here's a quote from Egypt's Sisi just published:
Calling his detractors “liars, saboteurs and wicked”, the Egyptian leader sought to rebuff criticism of the multibillion-dollar infrastructure projects he has undertaken since taking office, which are described by critics as unnecessary, extravagant and major contributors to Egypt’s economic crisis.
“Don’t you Egyptians dare say you would rather eat than build and progress,” Mr El Sisi said. “If the price of the nation’s progress and prosperity is to go hungry and thirsty, then let us not eat or drink.
“Don’t undermine the cause of our nation and make us the world’s laughing stock. Stand fast and transform the cruel circumstances we are going through into a gift. The harder you stand fast, the sooner it (economic crisis) will pass,” he said on Saturday, the first day of a three-day forum during which, according to Mr El Sisi, the story of Egypt since 2011 will be told from the state’s perspective.
With most of Egypt’s 105 million people struggling to cope with soaring food prices – inflation was at nearly 40 per cent in August – Mr El Sisi’s message to Egyptians to make do with even less may be seen by some as unrealistic, or even odd.
“What kind of country do you want to live in? Do you want to build Egypt and make it a nation of note, or not? Do you consider building an adventure? Do you consider reform an adventure?” Mr El Sisi said on Saturday.
The president's message that Egyptians should make do with less for the sake of the nation is being repeated, in different phrasing, by dozens of content creators across social media pages that have popped up in recent weeks to support Mr El Sisi in the December vote.
“Egypt needs a new president. El Sisi has done everything he can to protect Egypt and must be offered our thanks. Ten years are enough.”
Another senior politician, former MP Mohamed Anwar Al Sadat, warned that Egypt could be divided or even plunged into chaos because of the economic crisis and the lack of genuine democratic rule.
“We need free and fair elections that are not engineered in advance. A vote that guarantees a just political environment. An election with results that are not known in advance and which are held in a competitive framework,” Mr Al Sadat said.
https://www.thenationalnews.com/mena/egypt/2023/10/02/el-sisi-tells-egyptians-to-make-do-with-less-as-criticism-mounts-ahead-of-elections/
So, for those hoping the BRICS will somehow put the US 'in its place' - I ask you, do you want the likes of India's Modi (who recently had a Canadian murdered on our own soil) or Putin or Sisi to rise to global dominance? I certainly don't.
Tuesday 3 Oct 2023
HSBC Egypt has decreased the limit on monthly cash withdrawals made abroad from $1500 to $1000 or its equivalent in other currencies. The new cap, which took effect on 1 October, applies to all cash withdrawals
Banks in Egypt have been expanding withdrawal and purchase limits on cards used outside the country amid severe foreign exchange shortages.
In August, Egypt’s foreign asset deficit amounted to nearly $25.92 billion.
https://www.reuters.com/world/middle-east/egyptian-banks-tighten-dollar-limits-after-currency-pressure-mounts-2022-10-10/
Note: Last October (2022), HSBC reduced the maximum monthly withdrawal for travel purposes to $1,500 from $5,000 (see below)
https://www.reuters.com/world/middle-east/egyptian-banks-tighten-dollar-limits-after-currency-pressure-mounts-2022-10-10/
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Bottom Line: too little US$ = Egypt can't repay debts + too little imports + economy tanks = total chaos
Egypt’s sovereign credit has been moved to a “dislike stance” by Morgan Stanley
Egypt has lost favor with foreign portfolio investors who once saw it as a prime destination for hot money that kept its currency stable and boasted some of the world’s highest interest rates when adjusted for prices.
The prospect of a prolonged period of elevated rates in the US may now keep Egypt locked out of global capital markets for longer. The nation’s financing needs remain high at $24 billion in the fiscal year through June 2024, according to Morgan Stanley, and the amounts it’s getting from foreign direct investments, portfolio inflows and asset sales have been disappointing.
“The long-term drag on the credit remains the high financing needs this year into next year, particularly at a time when market access remains uncertain for single-B credits like Egypt,” the strategists said.
Egypt’s dollar debt has lost about 11% this year, the worst performer across emerging markets after Bolivia and Ecuador, according to Bloomberg indexes. Many of its bonds are in distressed territory, with the extra yield investors demand to buy Egyptian dollar bonds rather than Treasuries at 1,211 basis points on Friday.
https://www.bnnbloomberg.ca/morgan-stanley-turns-bearish-on-egypt-warns-risks-building-1.1979163
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What happens to Sukari operations if Egypt defaults? Will it be harder to import supplies? Will input costs increase substantially? Too many unknowns to safely say - IMO Centamin is now uninvestable.
Ask yourself if Centamin needed to:
- pay several million yearly to the bank consortium to secure the $150 million line of credit (which Mr Horgan knows the co. won't need to tap until a definitive decision was made on Doropo - IF even then. That is on top of paying additional millions in premiums for gold puts.
If yes, then congratulations!
If no, then you share my opinion, secretly.
What century doth this ring?
Please do not mislead the misled.
It was not Mr Horgan's husbandry that fore soothsaid said gold puts -
It was the bankers to wit they signed agreements for to borrow 150 million -
Smart money, not gold diggers, make prudent managers
Centamin PLC
25,329 followers
4h •
🎓It's a wrap! The 2023 summer internship programme at our Sukari Gold Mine has officially concluded. Over the course of 60 days, we welcomed 59 students from all corners of Egypt, offering them practical experience and education across different aspects of the industry. Each student received approximately 210 hours of training, for a combined total of 12,130 training hours.
⚒️This programme was designed to give our interns a well-rounded understanding of mining and geology. They learned about exploration, extraction, minerals processing and safety practices.
🤝Additionally, they had the opportunity to network and learn from experienced, senior mining professionals, gaining valuable insights into potential career trajectories. Programmes like these play a pivotal role in helping students make informed career choices while gaining a competitive edge in the mining industry.
👷♀️As well as enhancing practical skills for Egyptian students, the programme aimed to promote diversity in the sector. As such we proudly welcomed 8 female students, paving the way for more to follow their lead!
#Mining #Gold #Egypt #SukariGoldMine #Sukari #Centamin #CEY #SummerInternship #MiningInternship #MiningEducation #Educate #Protect #MiningCareer #FutureLeaders #DiversityInMining
Exploration Geologist Intern
Centamin PLC · Internship
Aug 2023 · 1 mo
Australia · On-site
I'm excited that I joined this great internship in Centamin PLC. Where's the Exploration, Geology, and Mining team OP & UG team though? And Where is my photo? 😊
Thank you so much Centamin PLC for this great opportunity.
Much appreciated 🏷️
https://www.linkedin.com/posts/centamin-egypt-pharaoh-gold-mines_mining-gold-egypt-activity-7114587173445619712-uVX8
Ahram Online , Sunday 1 Oct 2023
Egypt could save EGP 108 billion ($3.49 billion) annually through the daily power-cut plan that commenced in July, President Abdel-Fattah El-Sisi said during the Hikayat Watan conference on Saturday.
Electricity consumers in Egypt pay $0.032 per kilowatt-hour (kWh). US and European consumers, on the other hand, pay $0.23 and $0.30 per kWh, indicating that electricity tariffs in Egypt are significantly lower than those in the US and the EU.
In August, and notwithstanding the ongoing challenges, the government decided to freeze any increase in electricity sale prices till January 2024, owing to the present economic circumstances.
"The Ministry of Electricity sells electricity for less than its production cost, with 17 million citizens still paying just a quarter of the real cost for electricity", El-Sisi stressed.
The president also noted that the government is providing power plants with natural gas at reduced prices.
Egypt supplies natural gas to electricity plants at $3 per million British thermal units (MMBtu).
The country seeks to bring in $191 billion in annual revenues by 2026, up from the current $70 billion.
------------------------------>>>>
Why has Sisi decided to hold off on raising energy prices until January ? Cuz he's going to make sure he wins the snap election (by 95% of the vote!) in December.
And how in the heck will Sisi raise annual revenues to $191 Billion from the current $70 Billion??? He cannot - no way , no how, unless he tries to nationalize more successful private companies.
IMO Egypt is on the fast track to economic and social disaster - what is not clear is how a private company like Centamin will fare once the economic breakdown occurs - I've no confidence nationalization isn't in the cards for Sukari once push comes to shove.
The fact is 64 million Egyptians are already dependent on ration card subsidies just to survive - nothing will prevent extreme measures if putting food in their mouths gets just a little bit harder
https://english.ahram.org.eg/NewsContent/3/12/509374/Business/Economy/Egypt-to-save--bln-annually-from-power-cuts-ElSisi.aspx
1 with Centamin's accounting firm PWC
1 with UK's accounting firm watchdog
1 with FCA
1 with OSC
and 1 with what I'll call 'other' for now
that's probably keeping Mr Horgan busy ( so busy the CFO gave the Denver Gold Forum talk?)
A word about current CFO Ross Jerrard - he did serve as Interim CEO from December 2019 to April 2020 while the last CEO Mr Pardey considered his retirement
Caveat: I'm not downramping as some like to comment - I've no intention of buying shares until the important accounting questions/concerns I've alerted regulators about are addressed publicly
Great interview - a must watch for any mining CEO (or resource extractive investor!)
the fixable problem is never the gold price , but managing corporate expenses - if enough thought is given to building in profit - to h*ll with 'market manipulation' , the US economy or triple witching expiries - cuz it won't matter
why the gold mining industry is fraught with pump & dump share $ disasters is probably the caliber of executives lured into the industry , for some reason there's always a fresh crop of 'end of the world - gold is going to the moon' types ready to give them their money
Centamin Plc
@CentaminPlc
🥳☀️⚡Celebrating 1yr of #solar power generation at #Sukari. Since commissioning last September, the project has successfully saved ~22m litres of diesel and lowered emissions by ~59kt CO2-e.
➡️Plans are underway to expand it!
#CEY #SolarEnergy #decarbonisation #Mining #Egypt
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the Centamin PR team hard at work on twitter (earning their well deserved share bonuses)
- the waste moving coming to 'an end' will help both
- connecting to Egypt's electrical grid may not help either
in regards to the latter;
"Egypt generates almost all of its electricity from fossil gas and oil (almost 90% in 2022). Electricity production is rising rapidly, driven entirely by increasing fossil gas generation. Renewables made up 11% of the mix in 2022, with only 4.5% coming from wind and solar."
So then, connecting to the grid is not exactly a home run for the environment - and maybe not worth the risk given energy prices in Egypt will likely only rise. also there is the risk of more energy interruptions
Egypt Buys Oil Hedge to Stave Off Volatility as Economy Squeezed
In a recent statement to Bloomberg, Egyptian Finance Minister Mohamed Maait revealed that, taking place during the current fiscal year, Egypt has hedged its oil supply. While not disclosing further details, the minister did note that Egypt’s imports total about 150 million barrels of oil a year.
As one of the few countries to do so, Egypt engages directly in the oil derivatives market to lock in supplies, wrote Bloomberg. These are closely watched by options traders and dealers as they can make the governments involved significant market players, the news site explained.
Earlier this month, an unnamed government official was cited by Asharq Business who revealed that Egypt purchased hedging contracts covering 35 percent of its estimated oil imports for fiscal year 2023/2024 against the risks of rising global oil prices.
https://www.egypttoday.com/Article/3/127270/Egypt-to-hedge-oil-supply-during-FY2023-2024-finance-minister
Bitcoin? Few would answer yes.
How about gold? Same.
Ruble? Yuan? Euro? Yen? Good luck.
So what threatens the USD?
One could argue the strength of the USD is derived from the belief the USA is the strongest militarily, economically, etc.
So then the question becomes, has the US dollar become de facto gold?
If yes, then nothing - no downturn, no debt, will replace it.
Excess debt issuances can always be repurchased by the Fed - so perhaps the economic catastrophe that will 'one day' be good for gold - never arrives.
PS Just thinking out loud - I know nobody invested in a gold miner happily considers anything but a bullish gold view as the world crumbles under the wight of debt (alas, I also have several gold juniors in my portfolio) still one must plan for all scenarios