Member Info for EV_Bull

https://audioboom.com/posts/8026866-kiran-morzaria-of-cadence-discusses-their-fundraise-increased-ownership-of-amapa

My expectation is that we should be at least double the current SP when the market understands the value of our 27% Amapa ownership.

Yes because $20m net was authorised prior and we'd done $10m

We have made 3 shipments, and also facilitated several for Gerald Metals.
Next ship in is Kang Man for Dev next week, we don't know if that's for our stockpile or Geralds' until we're told.

I am expecting the NPV8 to be in the $1bn+ ballpark, I suspect the PFS is needed to help the market understand the potential here.
27% = £200m+
49% = £360m+

Clearly there will be interest in us from the bigger players now we own this (Nov 2012):
"LONDON (Reuters) - At least four suitors including commodities trader Glencore GLEN.L are in the bidding process for miner Anglo American's AAL.L majority stake in the Amapa iron ore operation in northern Brazil, according to sources familiar with the matter."
https://www.reuters.com/article/uk-angloamerican-amapa-idUKBRE8A10UB20121102

There aren't too many comparable companies out there to get a good market valuation but I expect in production Amapa would be worth somewhere half way between these to ASX listed Iron Ore miners. KM quotes the $660m Anglo figure which he must believe to be achievable once we're in steady state production.
Grange Resources 2.5mt US $666m https://www.grangeresources.com.au/announcement
Champion Iron 8mt+ US $2.43b https://newsroom.championiron.com/

@Olderandwiser you can look at these numbers from 2019 RNS based on $61/t for 62% Fe the mine was expected to be profitable, so understandable at $145/t it is very profitable even factoring the shipping cost increases:
http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=2887382
You can somewhat reverse engineer these to get an EBITDA at current rates but I'm looking at it from a free cashflow perspective as to what it would generate in terms of net profit.

At full production and using US$61 per tonne of 62% Fe Amapá is forecast to have:
o an average net revenue after shipping of US$266 million per annum,
o and an average EBITDA of US$136 million per annum.

From the latest presentation:
Life of mine OPEX – US$ 21 / tonne FOB
SG&A was $2/t (prior presentation)
note: capex & opex are 2019 vendor estimates based on 2015 site inspections and are being updated in current pfs

I haven't factored depreciation in but my understanding is it would actually improve the NPV because it would reduce the tax payable thereby increasing cashflows. I am also only considering 14 years of mine life, we know this could be extended given the massive resource in the area. I know my numbers are rough but I don't think they are a million miles out because they do give me an NPV8 in the range expected ($1.9b at the current ore prices)

I have factored in on a per tonne basis:
Fe Avg Price/wmt $156
Opex $21
SG&A $2
Capex/loans $10
Shipping $30
Total Costs $63
Gross Profit $93
Tax (Assumed 35%) $33
Net Profit $61

Looking forward to seeing the PFS as it should confirm the excellent prospects of the mine.

I have done my own numbers (shared here several times) I think profitability is actually likely to be higher than Anglo's due to the FX rate, better product mix and current ore prices. Profit could be on the order of $300m at current prices.
Revenue would be $829,269,600

http://www.custeel.com/en/csi.jsp
Per year 65% 62% Total
Tonnes wmt 4,400,000 900000 5,300,000
Price/dmt $175.20 $145.00
Price/wmt $161 $133 $156
Revenue $709,209,600 $120,060,000 $829,269,600

I am also aware of techniques used to reduce profits in certain jurisdictions to pay less tax and suspect Anglo would have used these legal loopholes, I suspect the figures could be half of the true value.

I include 3 years without profit in my NPV8 calculations to be conservative, the numbers are still very good.

That is £180m profit over two years. 27% = £48.5m 49%=£88m which is more than the current market cap and when you exclude EMH and other assets only a small fraction.
The BRL exchange rate has also moved in our favour quite a lot since then making the workforce very cheap.
Of course plenty of work to do before it’s back in production but just shows the size of the potential prize.

Anglo's profit numbers for their 70% share.

2012: $54 million ($77m / £55.7m 100%)
2011: $120m ($171m / £124m 100%)

@Jimb2 the president would need a super-majority to do anything about licenses that are already granted in Sonora an he doesn’t have enough votes to do that.
https://www.reuters.com/world/americas/mexico-will-reject-private-lithium-deals-even-if-reform-bill-fails-president-2021-10-07/

Nobody will hear until at least Tuesday as the timeline stated.

There is also a significant amount of Tin in the ore making it more economical at lower grades.

p.s the last thing you want to be when share dealing is "emotional" we try to deal with facts rather than feelings, this is still a potential billion dollar asset we will have 27% of very soon.

@MBW you should wait and see if there was a good reason that it had to be done this way, before casting judgement maybe there was, give it time.

FYI:
£500,000 at nominal 1p equates to 50m shares can be issued without a shareholder vote (approximately 33%)

https://www.cadenceminerals.com/wp-content/uploads/2021/07/Notice-AGM-2021.pdf

Resolution 4 – Directors’ Authority to Allot Shares
This is an ordinary resolution to grant the directors the authority to allot and issue shares and grant
rights to subscribe for shares in the Company for the purposes of Section 551 of the Companies
Act 2006 (“Act”) up to the maximum aggregate nominal amount of £500,000 which equates to
approximately 33% of the Issued Share Capital. This resolution replaces any existing authorities to
issue shares in the Company and the authority under this resolution will expire at the conclusion of
the next annual general meeting of the Company.

Resolution 5 – Disapplication of Pre-emption Rights
Resolution 5 proposes to dis-apply the statutory rights of pre-emption in respect of the allotment of
equity securities for cash under Section 561(1) of the Act. This is a special resolution authorising
the directors to issue equity securities as continuing authority up to an aggregate nominal amount of
£500,000 for cash on a non pre-emptive basis pursuant to the authority conferred by Resolution
above. This equates to approximately 33% of the Issued Share Capital. The authority granted by
this Resolution will expire at the conclusion of next annual general meeting of the Company

You can buy 1 Open Offer Share for every 20 Existing Ordinary Shares you have, they will cost you 20.5p each, the money will go directly to the KDNC bank account (as opposed to other shareholders). You can also opt to buy extra shares if other people choose not to participate.

@malaga No contact with HL this quote was taken from a very similar open offer on their website

It seems to have been thought about:

14th Jan: "we currently expect to finalise this in the first two weeks of next month" http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=311428223526507925
.....
Latest time and date for receipt of completed Application Forms and payment in full under the Open Offer or settlement of relevant CREST instruction (as appropriate) - 11.00 a.m. on 21 February
http://irservices.netbuilder.com/ir/cadence/newsArticle.php?ST=REM&id=311428222603782535

I am thinking 20% news could land and then there will be more buyers than sellers, if they've planned it as I think they might have...