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Absolutely shocked to see it trading hands for 3m quid today. Their listed equity portfolio alone was worth 2.1m on December 31st, that doesn’t account for the uplift in all the gold miners since then either. Barrack is up 50% in that time for example.Ascendant have shown no sign of slowing down in their commitments to the earn in, in fact , quite the opposite. So the 2.7m gbp by year end looks as good as banked. That doesn’t say anything for the promising unlisted stakes in Ideon and Golden Sun. Cap Energy does look to be dead in the water but the odd misfire is to be expected in this sector.And then there’s the residual ownership stake in LS which is a ton of money at 5%, 15% or anywhere in between.Once the earn in money is banked it would take multiple catastrophes for the equity here to be worth anything less than 6m.
Hopefully some good read across from today’s quixant results. Their outlook and current trading for 2022 sounded very bullish to me.
Did anybody see the Cenkos results and subsequent share price movement? Could be some interesting read across for Finncap… similar operations, similarly strong balance sheets, both have likely just had exceptional one off years but Cenkos trades at 9/10x that exceptional year’s profits whereas Finncap trades at 5/6x that number.
The only difference I can see is a bit of Simon Thompson backing, although admittedly I don’t know the businesses inside out.
Explorer/producer
Hi Cane, I believe that as the windfall tax is included in cost of sales, it is not therefore omitted from the EBITDA number. I believe the tax left out is just the tax expense figure of 419k. Although that is not to say that an EBITDA calculation for an oil and gas explorer/product is not plenty egregious in a number of other ways.
I've just run a quick sum of the parts valuation to make sure I have'nt missed anything so thought i'd share in case others might get some clarity out of it.
Taking the listed equities (mostly pires) from the last HY report at 2.5m that number is probably down to about 1.7m. The pre-ipo investments were 2.5m with imminent ipos that will likely turn this from 2.5m unlisted equity to 4m of listed equity. So that's probably 5.7m of total listed equity holdings once the ipos complete.
Then you have the 6.4m loan book.
Plus 2m of cash minus 1.5m of payables. So let's say 0.5m net cash.
So we might have 12.6m of tangible equity if the ipos go ahead as expected. Whilst the current market cap is a big discount to this figure it is not altogether unusual for low market cap investment firms to trade at such discounts.
However, here is what I believe separates RGO from these types of companies. Most of these discounted investment companies cost shareholders money each year because they have little to no regular income and any they do have is far exceeded by admin expenses which chips away at the tangible equity. If you look past the changes in value of the equity holdings in the last HY report and focus only on the 900k of interest and advisory income minus the 600k of admin and advisory fees, RGO are operationally profitable to the tune of 300k in the HY or 600k annualised. Moreover this is not accrued non cash interest that may never materialise if the underlying loan fails in the future. These are actual cash payments received in the period.
I think it’s a great opportunity. Thoughts welcome.
They don’t have any debt. In fact they have a huge pile of cash.
Ha
I wish I was, I’d be in Portugal right now digging us up that zinc at these prices!
http://www.canadianwarrants.com/company/a/ASND.html
A bit more info here, just some warrants that came to market upon the 2017 listing that had an expiration date of today March 7 2022. Completely separate from the actual share listing.
https://money.tmx.com/en/quote/ASND.WT
Yep they are warrants not shares. Nothing to worry about. Cerrado up 14% today too!
Must be incorrect as you can see a few trades going through right up to the close.
different RGO. That's PCC not PLC. An easy mistake to make, happens a fair bit if you look through the chat.
Even if JV is unable to negotiate the purchase of the EDM stake and we are dealing with the worst case residual LS ownership of only 5% the value on offer here is still incredibly good.
If we assume that the plan is to sell the project once the feasibility study has been completed then a 5% stake of a post tax $246m NPV discounted by a further 50% is £4.5m (I expect a potential buyer will want some money off for the rigmarole of actually building a mine)
Add that to the £4.8m of cash and shares they will have at the conclusion of the earn in agreement and things are still looking pretty rosy here.
As has been the case here for a long time, everything is underpinned by the earn ins, as long as you believe that they will be paid then everything else is a bonus.
Looks like we passed Russ!
…. Is the key takeaway IMO
Order book is clearly growing and that is unlikely to change as government support and likelihood of further lockdowns subside.
Barring any mishaps, increased lending means increased profits.
3-4m of PBT seems very likely in the next 12 months.
Should have a Quarterly NAV update Monday morning if they follow the same schedule as last year.
Wow. Someone selling 9.50 which is a representative market cap of 3.34m.
That’s only just above 0.8m current cash + 0.75m June cash receipt + 1.7m listed securities
That even puts the December payment of 1.7m in the price for free. Let alone Lagoa Salgada residual ownership, Cap Energy, Ideon and Golden Sun.
I am shocked that we’ve seen that price trade this morning. Great buy for whomever was lucky enough to be on the other side of that transaction.
haha
Just checking that my (quoted investments + cash + remaining earn ins to Dec 22 - 18 months operating expenses) number still exceeds current market cap so that everything else including Lagoa Salgada upside is still in the price for free....... good news it is!
$3.5m to MAFL in 2022 which is still pretty good!
Has the market missed the implications of these numbers maybe? Increased cash by 2.9m and paid down £5m of debt since the end of July. So that’s 7.9m of cash generated in a 4.5 month period. Obviously we won’t know until results how much of that is movement of working capital and how much is profits but with 3.5m PBT in H1 we could easily be looking at 10m PBT for the full year and possibly more.