Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
Well lets take a couple of assumptions
1. I do get chance to buy at 20p
2. I’m right about the cash balance at year end.
Then it shouldn’t take more than a year to see that 100% return. But seeing 2 years of consistent cash growth will most likely mean the price will be heading to 60p and higher.
Either way… it’ll be fundamentals driving it, not magic.
This is not ramping it's a a simple fact...
Cash grew from 9Mish to 15Mish this year given the meager profit. This is the effect of the free cash flow.
All payments are up to date, a no debt, everything settled.
If the the free cash flow continues at this level there will be over 20M in the bank next year. It's not a huge cash pile but it is with respect to the market cap. I stand by conviction, this business is stable and cheap and and that means reduced risk.
Do you see a reason that won't continue? I don't...
Yes, the write downs will occur... and they will look barely profitable.
However, cash at the end of the year will be >20million if no acquisitions take place.
This rate of cash growth on a market cap of 62M is dirt cheap.
Expect acquisitions this year
Cash is being preserved for that purpose with no plans to raise
Any acquisition will be cash flow positive
Free cash flow 7.8 million! Wow, way further ahead than expected
Amortisation comes from legacy contracts, this year about the same but reducing in following years
This is cheap, at least half price right now...
I wouldn't put any faith in auto generated simply wall streets articles. Their own automated valuation of TLY put the valuation above £6 which in itself is crazy.
Look at the free cash flow, balance sheet changes and the forward outlook for the liabilities. Investors don't understand the state of the company... on the current outlook, I'll be holding for at least a couple more years.
This was probably know beforehand too... written into the terms of the latest debt facility changes. They should be required to report the details of these facilities, their actions are completely unfair to the current holders.
Never seen her this bubbly... great interview from Paul Hill as usual
https://www.youtube.com/watch?v=h2cTznK4knQ
Yeah, I tend to agree... it's too soon to take a profit. I wouldn't work about growth either.... I'm confident most of the contracts renewed this year will be converted to ICS agreements with better terms and they'll be asked to bid on others too. Very likely towards the end of the year.
At the moment, I have no planned target to take a profit because I don't see the downside of holding for the mid term.
They’re also sitting on a fairly large cash pile for a small cap… it’s not unfair to return some to investors. Most will probably go into an acquisition but I think a dividend raise wouldn’t be out of the question especially given that they’re running ‘ahead of expectations’