Member Info for dusty42

"with the revelations about a sudden amount due to Mali"

The situation with the Mali gov was not a secret. There had been press for a couple of months with regard to them (in some cases retrospectively)'renegotiating' terms with other companies. In the end whether you agree with it or not, legitimate governments(/military juntas) can do that. Even in the UK we placed windfall taxes on energy producers long after they had made investment decisions. So it happens. In th end, is it in the Mali gov's interest to tax producers to death, possibly not. There's a big difference between the operations of Barrick, B2gold, Resolute Mining(and others) in Mali and Hummingbirds relatively old and pretty tiny mine. I'm not saying a tax bill will not surface. But worst case it should be possible to walk away from the mine. OR, send in Dan to negitiate with them! ha.

The main value of what's left of Hummingbird is in Guinea, not Mali.

Also @ GI

You say:

"It’s clear reading the last 5-6 posts here people cannot read , they have stated Yano was loss making and they were diverting resources from it to Kuruso….. "

The RNS says:

"The Group remains focused on closely monitoring liquidity across the Group and strategically allocating resources to support Kouroussa's ramp-up and maximise operational output."

The do say Yanfolila is 'currently loss making'. We already knew it made a loss in the last quarter, BUT CRUCIALLY a much smaller loss than the quarter before that. This bit you mention about diverting resources from Yanfolila, can you point me to where they say that? Sure they are trying to allocate resources in the best way(as all companies do), but I can't see anything about them diverting resources from Yanfolila. I think you are reaching a different conclusion to what is actually said. At least from looking at this particular RNS.

Also GI, commercial production is normally reaching 60% of intended capacity I believe for the mine / processing facilities. That being the case, if you ignore the fact we heard about this one 2700/oz week, the declaration of 1900 over and extended period could be viewed as quite a solid number, decently above what they would arguably need to declare it commercial.

If they actually managed to sustain 2700/week for a whole year it'd be chucking out over 140,000 onces a year, which is a fair chunk above what was expected.

Even if 'only' 1900/oz/week was susained as an average over the next 3 years, gold prices remain roughly where they are, aisc is in the forecast area of $1400 and the hedge comes off early in 2025, Kouroussa will be making a lot of money.

1900(oz/week) x 156(weeks in 3 years) x $1200(margin per oz - $2600-$1400) = $355m

I'm not saying this is neccasarily realistic and we can quibble over the aisc going forward and possible gold price. But based on current levels / cost assuptions, 1900 a week does not look too bad and does not mean the mine is unviable by a long stretch! (for 'whoever' owns the thing)

"On Kuruso like dusty says 2700 week one turned into 1900 average"

We don't know for sure when the period of declared commercial production started, we don't know when it ended and hence we can only speculate about it's duration. We also don't know whether the 2700 occurred in the first week, specifically because of the two aforementioned points. It is just speculation. All we do know if that they had one week of 2700 and a period of unknow length that everaged 1900. It might be reasonable to assume it was the 4 weeks imediately prior to the announcement, and hence maybe we can extrapolate roughly when the 2700 occurred. But it really is just speculation.

Beyond that, mining is an inconsistent game, sometimes you might get some higher grade ore, other times you might have to process lower grade stuff. Lots of other factors are also at play.. as said I was suprised that IF it was a 4 week period, that the other 3 weeks(or some mix thereof) saw that a fair bit less poured.. bringing the average down that much - BUT, it's worth remembering even 1900/week is close to 100,000 ounces a year. Not too shabby. And even well established tier one mines can see quite large variance in production over time.

"Knife edge stuff..."

Indeed. Though 'possible' that if the recent tradjectory of improvement at both mines can be continued that they could produce the require amount. Should be drier at both mines and we also know Kouroussa managed 1 week of 2700oz(why the other weeks were significantly worse remains unexplained, assuming the declaration of commercial production was based on a 4 week period). But yeah, we've probably mostly been here long enough to know that targets seem to rarely be beaten/exceeded(at least for the last couple of years).. at least under the previous management. And a bit hard to know how hard this lot will be trying, right now.

Then q1 the hedge comes off.. so a bit of a gain there, if prices stay where they are. So presumably the lender could just provide a bit of wriggle room in the debt repayment.. if they were so motivated.

Is a poll not just based on the number of shares with voting rights? Essentially every share minus Coris's c42% carries one vote?

I know the BOD have recomended this, in their role as directors(guessing they didn't have too many options). But does that preclude them from voting as they wish as shareholders?

If the debt to equity conversion is blocked, they will not be able to easily take it private.

Are you sure about the commitment being made in advance?

@ Juxtapose, are Alwaha and AIMSL both Cassidy? I don't really get what you mean saying they hold all the cards? How they vote will be important sure, maybe represending over 10% of non Coris afiliates.. but they can't carry it on their own.

There is also Richard Barton who is not included in your list and has over 3%. I'd also say that it may be the case the directors don't vote in favour. Surely ernie nutter can't be pleased with this situation/potential outcome.

Toffers, the choice is about how to vote. What gets offered is down to Coris. And if independend shareholders fail to block the debt to equity conversion, I dare say you won't have much choice but to accept whatever they decide to offer you, which is not garunteed to be 2.6p.

"I did well to escape with 70 grand from these scumbags"

Your £70k loss? It's not a brilliant result is it? And wasn't it £120k in total with your first investment?

And now flipped to a barrage of super negative and fairly misleading one liners. Still, whatever suits your narrtive I guess.

"It clearly implies in the RNS.."

Which part of the rns are you referring to Tony? I can't see any mention of drilling? Accepting it does not include any guidance figures for next year. Though they do say:

"With commercial production now achieved, Hummingbird remains focused on improving mining operations performance, plant throughput and feed-grade to reach steady-state production in the coming months."

@ *goestheeasal - fair comment. I could have bailed at 2p sure. Perhaps if the waiver is blocked it will just end in adminstration(I like to hope I have a balanced view of possible outcomes). Also a possibility of a different offer, or the possibility that the company just carries on in some guise, new lender, same lender - whatever. I am not saying any one of these is 'likely' nor would I try to (publically) attach odds to these different possible outcomes(because in honesty, I think it fairly unknowable). Coris could just cut their losses absolutely. Though on the other hand if Kouroussa is producing 100k/oz pa and potentially viable, maybe they don't want to have to write off a 42% equity position as a total loss.

I still have a bit to loose, but a NO vote puts the ball back in Coris's court, as you say it'll be interesting to see what they do, if that is the way it pans out. And as I said, logically.. why would any independent shareholder vote in favour of a rule 9 waiver?

Deep breath, I'm not going to reply to all the ones liners in all your posts GI, (btw do you know that as I write this, 11 out of 25 posts on the first page of this BB are yours? Almost 1 in 2. Doesn't that seem a bit odd/unhealthy, particularly with regard to a share you are not invested in? Anyway..

I will be voting NO to the rule 9 waiver, as I think it makes total sense for any independent shareholder to do so. Any offer is not contigent on how a person votes. In all honesty, the idea that ANY non Coris shareholder would vote in favour of the waiver, seems utterly bizarre to me.

I wish you the best in your next investment.

GI I don't want to argue with you and I welcome different perspctives, balanced opinions and debate. But I also prefer for people not to portray specualtion as fact. Hence my taking exception to you saying Coris had written off their equity position. I'm sorry that the position you took didn't work out, but I do not enirely agree with your conclusions. Do I think 'anything' is rosy with hum, no absolutely not. But I think independent shareholders would be wise to vote NO to the rule 9 waiver. Let's see what Coris do then.

They were always going to try and make any news released sound downbeat, though obviously they cannot be misleading. So I expected anything that came out to sound pretty dire(they should have hired david brent as communications director)

I agree with RetiredBanker, the main point of the rns was postive. Can they sustain that rate? Well I guess it depends on the ore grade, the management and how the performance opperationally.

I've been well aware of the Mali situation for months. Other companies have successfully renegotiated terms(b2gold). I have no idea of the outcome for hum, it's something to be aware of. Though I think yanfolila is a bit of a sideshow.

I thought the average vs that one declared week was quite a stark difference. But lots of things could explain this. I didn't really expect 2700 to be susained for 4 weeks.

"Coris don’t care a about that 42% at this stage "

Err, right. What is this, pure speculation on your part? Or have you been speaking to the African bank about how their view their current shareholding? (sorry their associated organisations shareholding)

I already said adminstration is a possibility. But you don't know how this is going to play out and nor do I. If you sold out with a £70k loss, why are you still posting here?

"relying on takeover rules and betting that the creditors will somehow mechanistically obey them is naïve. in practice the rules can be avoided or turned to the advantage of the creditors and if all else fails then the company will be put into a pre-pack administration. messy but preferable to letting the shareholders off the hook. "

ok @ ****goestheeasal, just questioning as what you have said now is a bit different to what you implied in this post ^ yesterday. absolutely though, if either the company goes into administration or the waiver is voted through - then the take over rules do no longer apply. otherwise, they do.

and sure, adminstration is a possibility, but as my original post pointed out, coris being a 42% shareholder and currently in control, this might not be an option they favour. and if shareholders vote against the rule 9 waiver successfully, they will have to rethink their options.

and as others have said, there is no cost to voting against the waiver. it doesn't mean an offer can't be accepted if one is made.

@****goestheeasal - you seem to have avoided any direct answer to the question i asked you regarding what you meant specifically about the takeover rules being 'avoidable' yesterday. are you not wishing to elaborate?

@Crossthetea - Interesting point, so Coris at this point cannot even push hummingbird into administration? Well, at least until they fail to make payment of further debt potentially I guess. That being the case, why do they expect non affiliated shareholders to vote for the waiver?

"relying on takeover rules and betting that the creditors will somehow mechanistically obey them is naïve. in practice the rules can be avoided or turned to the advantage of the creditors and if all else fails then the company will be put into a pre-pack administration. messy but preferable to letting the shareholders off the hook. and in any case i think dan and co have not only charmed shareholders into putting too much money into the company he's also done it to the creditors too!"

hi ****goestheeasal. you seem to be the only one to respond to my question(at least i guess you are responding?), can i ask.. in this hypothetical situation where the rule 9 waiver is blocked, what exactly do you think is going to happen? as far as i understand it, this will make it impossible for coris to proceed with the debt to equity conversion. at this point, they can either call in their debt(sort of partly owed to themselves by themselves), and put the company into adminstration, thereby loosing operational control. or, presumably they can allow the company to continue in some guise. can you elaborate on how you are suggesting they can avoid this rule? i am genuinely curious and you seem to know more about the process.

Logically speaking, did anyone expect the next RNS from the company to be anything other than as downbeat as they could possibly make it?

The people signing off these announcements are the same ones trying to take over the company. Seems unlikely they would be risking further funds of their own, if they see no hope for the mines(particularly Kouroussa). Even forgetting the possible offer, they have already handed over more unsecured debt of late.

People selling out below even the 'potential' offer is exactly what they would like(regardless of whether they actually intend to make an offer at that level). Therefore it is very much in their interest to create doubt and fear.

On the face of things, Kouroussa being at 1900/oz/week is not bad news. That's just shy of 100k ounces a year. At this level I would have thought it's highly likely to be a profitable operation in isolation, even with the short term drag of an unfavourable hedge.

Out of interest - what do people think will happen here if non Coris affiliated shareholders vote to block the rule 9 waiver? How does this play out then? No one seems to mention this possibility. Do Coris bin their 42% odd shareholding(purchased well above today’s prices) and pass control to the administrators?

And we do know they reported a week 2700/oz poured, which now appears to have been a freakishly good week, with their 4 week average being, apparently, being quite a lot less good.

I think, if you look, you'll see commercial production in mining normally means 60% of designed capacity over a sustained period.

Predictably downbeat rns aside, I'll still be voting against the rule 9 waiver.