Member Info for HarChris

Here's a scenario to illustrate:

POG averages $2900/oz to mid 2026 and then the bull run comes to an abrupt end and POG slumps and averages $2100/oz over the coming years. Now compare THX with the company I mentioned in original post...

Does it affect both companies? Well yes, THX still suffers from vastly reduced profits but THX has gone on to make over $200m net profit in that period from a net cash starting position, Robex have only just started producing. THX is now a multijurisdictional producer with 150k oz per year output and developing further operations in Ivory Coast, Robex is profitable but the modest profits are instantly consumed by the debt repayments and interest and they cannot afford any further downturn in gold price.

Point is it's producers that are benefiting today from this sky high gold price, it's producers like THX with no corp tax to pay and no financing costs that are making hay. How a company like the above has a 50% higher valuation when they are so similar in scale and location yet pre production is hard to rationalise.

Well Indaba well behind us and gold about to hit $2900/oz.

I see no reason why this share price momentum won't continue this week.

Looks like they aren’t even bothering to share the bad news now.

Been going through more feasibility studies this weekend and comparing future projected value of projects against those company's current valuation. Here's a very good example:

Robex Resources is a Canadian listed gold explorer with a planned project also in west africa, in Guinea, so the parallels are significant. The Guinea project, Kiniero, looks very similar to Douta too in scale, albeit they have completed PFS and DFS so are ahead of Douta by about 4-6 months. 139k ounces per year for 9 years is comparable with what we should expect from Douta albeit at a lower AISC. Countering that they are requiring $243m upfront capital, we have been quoted $175m-$200m for Douta.

Here's the mad thing. Robex is valued higher than THX. About 50% higher! A very similar project to Douta, yet pre production, requiring a significant amount of debt to be incurred for construction.

Meanwhile THX is already generating so much cash that they could fund their own equivalent project internally over 2025/26. They won't, because part leverage is the better route with cash being used for dividends/buyback and to build out Segilola, as well as develop a third or even fourth project but the risk for Thor must be so, so much lower than that of the company i'm describing here, what with being pre production as a miner.

It's absolutely nonsensical that this Canadian listed explorer with a planned project in West Africa of a similar size to Douta is valued 50% higher than a company that is able to fully realise value from the gold bull market right now, is debt free, and is accumulating cash at an unmatched level for an AIM company.

The Kiniero DFS shows a post tax NPV of $647m at an average gold price of just $2330. If we assume Douta PFS will show a similar NPV and with significantly less execution risk for THX (have suppliers/infrastructure from Segilola project, experience build up etc) plus an enviable balance sheet before the project has even got off the ground is it now fair to argue that the Douta NPV is about the market cap THX should be aiming for over the coming year or so, ie $650m?

I noticed Thorn's gone quiet on here since his only investment has crumbled in valuation. I just hope his predictability skills prove to be just as bad with Avacta.

Share price is only down 50% over the past few months whereas revenue is likely to be down 80%.Having said that the new interim CEO has put his money where his mouth is so let's see.

I'm the first to warn people of risks when valuations get carried away, especially for share prices that spike off the back of commodity price rises with little to no actual cash generation to show for it.

THX is different though, being almost unique in seeing the entirety of any rise in gold reflected in the net profit.

I'm a firm believer that the biggest risk to any business, wherever it's based, is financial (especially if indebted) and so this past year has enormously derisked THX in my eyes

And I also like to point out how much of the risk is priced in.

Trust me, if THX had the identical business metrics and outlook and was, for example, operating out of Canada and not West Africa the market cap would be over a $B. Instead it's about $180m so there's a hefty Nigeria/west Africa risk priced in.

As more is done to give comfort to shareholders re west africa risk that market cap gets closer to the ~$B valuation that it would otherwise have.

And let's also acknowledge that you've been sounding the alarm about this since 14p, I've been pushing a narrative that the risk is low. So far at least my take is earning people money rather than sitting on sidelines and missing such a move.

But even if they were to, for example, ask for 10% or even 20% corp tax these next two years THX would still be fundamentally undervalued. So risk is low besides a short term hit to sentiment if such an event (I think unlikely) occurred.

They're also working hard to attract new investment to Nigeria. A one-off, single entity windfall tax, reneging on their pioneer scheme, is a terrible look and will only lead to (i) THX looking to direct attention to Ivory Coast and Senegal and (ii) put off future companies from viewing Nigeria as a viable jurisdiction.

All for say $40m tax per year in 2025 and 2026?

A country with $370B GDP that receives massive tax revenues from oil companies isn't likely to shoot itself in the foot over a relatively small amount.

Buys going through at 22p - once the all time high is broken I'm hoping this shoots straight to 30p.

I did too when the share price was 15p, will use up a lot of the cash if THX is buying millions at say 25p though.

More likely to see share price spike and fall back but either way works for me, they aren't going to sit on all this profit until Douta construction begins so any positive use gets my vote.

On Monday... going to be interesting to see if SP can hold up after that lands.

This rise comes before some pretty big catalysts that are due anytime - a statement re Nigerian Federal Gov support, the Douta PFS (much larger mine than Segilola), inaugural divided. These three could land anytime and then there's Segilola drilling results to expand mineral reserve and mine life, lithium updates (sounds like Q2), full year results in April showing a transformed balance sheet and then record breaking quarterly financial results again in May for Q1.

This is a $500m+ company in the making and with a tailwind possibly much more.

A reminder that today is the last day of the Mining Indaba in which THX has a strong presence. Was always unlikely to get an RNS during this time but from tomorrow, or more realistically next week, company should be free to start releasing news.

Net don't you mean? Gross would be taken at cost of sales/cash costs.

As long as gold continues to be seen as the safe haven THX's medium term future is completely secure and mid tier status is highly likely. Patience starting to pay here finally.

New highs on the TSX tonight - think we're about to see resistance broken. Clear skies above 23p when ATH is broken on LSE.

So much to digest and fair play for saving the company from imminent administration but boy is that a ceiling placed around 5p.

So first the £900k due for the original CLN is being converted to shares at 5p, so 18m shares + accrued interest also at 5p a share. Next £1.605m of new CLN notes convertible at 5p, with a 1:1 warrant attached to that's potentially 64m more shares.

And there's negotiations going on re the £1.9m CLN maturity needing payment by July.

All this just to get operations up and running again and to stay solvent but the aim and strategy is a positive one so still some hope for shareholders to eventually claw something back.

What a mess the old management left things.

I remember thinking $2000/oz gold was solid enough, not too long ago... now that's the NET margin!

This move was always in the back of my mind when investing but never really thought $3000/oz gold would get tagged in 2025 - now we're close.

What a time to be entering a news rich period.