Chris Heminway, Exec-Chair at Time To ACT, explains why now is the right time for the Group to IPO. Watch the video here.
Indeed Scotsman
That's called marketing.
Sheps8
Nitrogen and sulphur are both in high demand at the same time of high growth and both are easily leached. For cereals, osr and many crops they are applied to get her in a compound. Phosphate and potash are well held by soils so timing of application is not critical. Pre planting is fine as is anytime with nitrogen and sulphur.
Origin fertilisers seem to be the only UK mainstream manufacturer who are prepared to use polysulphate in their compounds and indeed they do mix nitrogen and polysulphate together. After all it's a alternative to their two mainstream nitrogen/sulphur compounds.
Origin Fertilisers can supply PolysulphateTM either as a straight or formulated into a wide range of NS, NPKS, or NKS compounds tailored to all soils and crops.
PolysulphateTM enables Origin Fertilisers to make compounds containing nitrogen (N), phosphate (P), potash (K), sulphur (S), calcium (Ca) and magnesium (Mg) to which we can add micro-nutrients, including: boron (B), cobalt (Co), copper (Cu), iron (Fe), manganese (Mn), selenium (Se) and zinc (Zn
This project was significantly devalued in December 2012 when the NPK concept study although lucrative had to be rejected on the grounds of capital cost.
Compounds are the products of choice for the majority of end users.
Other than the small blenders like Origin who have adopted for organics who wants the product now?
ICL have realised to shift the stuff, it has to be blended with nitrogen, phosphate or potash to produce formulations that match crop requirements
https://www.google.com/url?sa=t&source=web&rct=j&url=http://otp.investis.com/clients/uk/sirius-minerals/rns/regulatory-story.aspx%3Fcid%3D485%26newsid%3D294319&ved=2ahUKEwip4LiowsDgAhV6VBUIHWRuAesQFjABegQIBhAB&usg=AOvVaw2hqhaYnoLTllqYf-8DRxtr
I am with chilting, selling to a distributor with no manufacturing capacity will not encourage poly4 usage.
and being amazed by the vastly superior expertise of many other board contributors!
Thorpe don't put yourself down, no one is more blind than a man that does not want to see.
It is refreshing to read a post that is honest.
It is increasingly prevalent for suppliers to essentially offer credit to their customers by way of extended payment periods , periods of 90-120 days are not uncommon. In order to protect themselves from the risk of default and to improve cash flow, suppliers are using credit insurance (possibly from the same banks who are lending for development) which , obviously insures against default but also , crucially ,pays up front to the supplier (with a fee of perhaps 2-3%) and collects some time later from the recipient.However , in the current climate such credit insurers are demanding "enhanced credit quality " before they bear the risk, and/or demanding a higher fee for their service.Clearly this will have an influence on SXX "bottom line"or in an extreme case render sales to lower credit risk companies impossible,hence CF's concerns.It does also suggest that SXX may well be still pursuing deals with larger more well-established wholesalers even in areas where Torps already exist.What immediately comes to mind is the seasonal demand in the northern hemisphere, Feb to May.To shift out of season requires a deal and credit to end user.
Alan
The product is not all it is claimed to be, or that would seem to why the govt support is not there.
If you understand the fertiliser industry, this difficulty is all very predictable.
When is the 10 for 1 share consolidation?
GK
You were way off the mark 30 months ago, fundraising reflects the business proposal and risk. I see no reason why any share issue would be at a premium, if achieved.
Just to remind you, your thoughts pre Stage 1.
For instance: if with the debt deal it was seen as fair that this valuation should be discounted by say 85% from the expressed fully developed project (20mt/y) NPV (=$15bn), that suggests fair market value of $2.25bn. Take off $550m from equity gives $1.7bn on a debt deal struck. With 2.3bn shares that’s 54p.
The issue could then go at say 40p to create enough incentive. Taking the total to 3.3bn shares.
Will it? It should. Higher or lower? Up to Mr Market that one.
GK.
Well 3.3bn shares, what happened there.
The inevitable heavy discount on price and even then risk had to be mitigated.
chilting
I am sure some growers will buy poly4 as a straight but for most situations it is high in sulphur, low in potash and has neither of the 2 majors, nitrogen and phosphate.
Trials invariably use compounds matched to specific crop and soil needs as of course do most effective fertiliser programs in commercial production.
ICL have had to respond to the market by producing a wide range of compounds to stimulate demand. The 15 different products in the PKplus range and these may be more useful on farm. They seem to have inclusion rates of 20 to 35 per cent polysulphate as levels of potash have to be lifted with MOP
https://www.google.com/url?sa=t&source=web&rct=j&url=http://www.polysulphate.com/&ved=2ahUKEwimzu-nv73fAhXqTxUIHdjRCKcQFjAAegQIBBAB&usg=AOvVaw0xAJUyB8Tl0KhjB2rvjLbx
"in return for an exclusivity to market space, priority access to production"
Your comment above hinted to me of a new region for exclusivity and a serious major international player. That would be someone like YARA, Eurochem or CF industries for Europe, not a small growing company like Origin.
Yes ADM, is a great partner but fertiliser is such a small part of operations and it does not seem to be more than a broker of straights. Poly4 will need to be blended or compounded to balance its strengths and weaknesses to get traction, that requires the serious infrastructure of a major player. IMO
There is a make believe fairy tale on the telly at the moment.
A deal like that could only come from someone like YARA, perhaps a good fairy could cast a spell on their management to make them believe in poly4.
I agree John25,
Timing is everything. Why carry the risk of being over exposed here at this time. Fundraising always leads to lower share prices. The plan of debt only fundraising would have isolated shareholders from share price falls but I doubt many believe that new issue of shares in its many forms can be avoided.
Does the current business plan stand up to due diligence? If not, this is going South in more ways than one.
Seasons greetings to all
I did not expect a debate over the pricing of poly to result of the thread and the reading of the document as that might be constructive to investors understanding of the project and its value.
Just the normal defensive response.
Never mind.
Remember every pantomime has to have its villian to make it enjoyable
That document is worth reading and understanding.
But I suspect an independent review is not what rampers want to read, far too balanced
I would not take much notice of conference calls with managed house brokers questions.
From "shovel ready" in summer 2015 to DFS in Q4, then Q1 2016 led to a nice dip for you traders who talk your book to exploited. 12p again anyone?
So why state the desired aim to have a strategic partner? That's a bit left field. Strategic partner – to provide capital at either the asset or project level. Would also enhance perceived execution risk for key stakeholders
Why would a trader like Keytrade add much to sales. Other than taking a cut of the margin on a straight fertiliser and selling others compounds where is the gain. As agents how can they predict and contract sales. Fully integrated manufacturers and distribution companies that believe in the product and are prepared to integrate poly4 into their formulations is surely the only route to meaningful sales Yara International Eurochem CF Industries Even some of the smaller co ops would be a better fit
Financial Times MYFT Mining Companies Costs up and cash needed at Sirius Minerals Twitter Facebook LinkedIn 7 SEPTEMBER 6, 2018 By: Dan McCrum Some news landed from Sirius Minerals Thursday. Here's the initial share price reaction: The headline is that Sirius' plan to dig a fertiliser mine underneath North Yorkshire will cost about $500m more than thought, financed by fresh equity or subordinated debt, in addition to the $3bn of senior debt it needs to raise (and which it hopes can be underpinned by government guarantee). Obviously, that's only if the company can round up enough customers able to buy large sums of rock in the middle of the next decade. As we wrote in an extensive look at the company last month, the existence of a market for the product, at a price which makes the project viable, is far from proven. On the capital cost front, here's the changes announced by Sirius: Those numbers represent “a P65 confidence level in its revised capital cost estimate, meaning that in 65% of iterations the Project will not exceed the capital cost estimate”, the announcement said. So there is a one in three chance they will go higher again. One surprise reason for the cost increase is the width of the very long tunnel to be dug under the area of outstanding natural beauty. Sirius described “optimisation of the tunnel design including an increase in the planned internal diameter of the tunnel from 4.3m to 4.9m and an increase in lining thickness from 250mm to 350mm”. A mere 30 per cent increase in the volume to tunnel. The bad news is leavened by a claim that operating costs are assumed to be slightly lower if and when Sirius gets to the point of production, a precise $29.4 per tonne cash extraction expense at annual production rates of 10m tonnes. Although investors might ponder the promotional nature of a company which includes slides that are, to use a technical term, just silly: Aside from the fact that any project which loads all of its costs into upfront capital investment will look really profitable if it then ignores those costs (the depreciation and interest in ebitda), the giant squashed-egg of potential Sirius profit is ludicrous. It's based on post-2026 aspirations for volumes of 13m to 20 million tonnes per annum, suggesting an ebitda range of what looks like $750m to $3.2bn, all at a 60 per cent “margin”, compared to 2018 forecasts for its peers. Remember, this is a company for which the overall cost estimate has risen 14 per cent in two years, and the deadline for securing financing keeps slipping due to the ongoing search for customers willing to commit. It teased the possibility of signing up buyers in Europe and Brazil by October. On the financing front, chief executive Chris Fraser also dangled a possibility of an unnamed white knight, which may be enough to keep bulletin board interest in the stock alive, even though it would dilute the value of S
Look at what has been aloud to happen in the middle of a national park.....what a complete mess on the countryside if careys, bauers, strabag ect downed tools and left it as is, got up and walked away. Almost 10 years of planning, granted permissions, getting locals on side, torp commitments..... funding. Im sorry but i dont believe THIS is going to fail, not one bit. 25-30% dilution.....maybe, posibly - but who cares? I want a comple mine. .................. Well has that what has just happened in the Dartmoor National park with some Australian company with a great business plan for a strategic mineral. A mess to sort out! The party is over.