Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
I don’t check in here frequently these days. After I sold my GGP to release cash that I needed because of poor health. I’m still very bullish and think GGP have a bright future. Most likely are acquired at some stage by Newcrest in my opinion.
There are some short term concerns.
The change in the relationship between GGP and Newcrest. It seems that the major wants to use its leverage to get 5% at a heavy discount and drive so down.
Need for capital in increasing illiquid market backdrop potential for further share dilution.
If Newcrest continue to play hard ball they could make raising capital in this market more difficult.
Gold has dropped to 1820 and will continue to be under pressure in environment where interest rates are rising and inflation starts to cool which is my base case now. Why? Because demand will be taken out of the market by increasing rates, costs and therefore cooling economy - recession. Even if supply remains constrained the decrease in demand side along with government huge debts are deflationary.
There are two key inflection points coming resolution of 5% and a GGP source of funding for capital commitment to mine build.
If I were still in I’d hold but have cash ready to buy more at lower price if sp slipped further. Not advice, we are in a very difficult market that will test the nerves of investors.
I wish my circumstances were different and that I could still be in on the GGP journey.
Good luck all.
GGP is on the wrong exchange.
AIM maybe good to raise capital but is the renowned as Wild West of stock exchanges.
GGP would be well served to get a dual listing on ASX to give investors another option to trade.
Markets are a financial representation of human herd activity.
Driven by Exuberance, greed, Confidence or flight and fear. Markets change in a moment.
If investment portfolios reverts to mean levels of portfolio exposure to gold. The price of gold on basis of supply demand will flourish.
Greatland Gold has a wonderful once in a lifetime asset in Havieron, surrounded ground to further explore and tenements in elephant country. Yes capital is required
I completely understand patience is being tested, everyone must make their own decision and you are willing to stay invested for long haul.
I had to reluctantly sell my GGP shares because I needed cash as I’m out of work with poor health.
Good luck to all.
Share consolidation is highly likely in my view. Can’t keep diluting share into multiple billions.
Wishing all fellow GGPers a very Happy Christmas and Prosperous New Year.
It has been challenging at times this year but everything is developing really well for Greatland.
Experienced BoD
An outstanding Tier 1 deposit
A rapidly developing mine
Prospective ground in elephant country
New Identified targets for 2022 drill campaign
Cashed Up
GLA
Prepare the buyout in 2022 IMHO
Newcrest want Havieron not 60,70,75% but all of it!
Will they buy Havieron or take out GGP whole is the only question.
NCM have decades of expertise in Peterson and will want to own prospective ground along with new assets.
They have JV with Antipa and I am sure will be keeping a close eye on Artemis ground north of Havieron. I think it’s more probable that they will acquire GGP as we lock onto new targets from EM and recent drilling data.
I’ve got a really good feeling about 2022.
Wishing Tom and CJ all the best for tomorrow. I will be thinking of you, sending positive thoughts and good wishes
If whole heartedly agree with Magictrades post ‘Time to decide’
I am an investor, not a trader. I will wait for the story to develop I’ve the next 4 years.
I stay focused on what can happen in that time frame.
1. Havieron reserve size will grow, in my view significantly.
2. Cash will be generated for GGP from mining Havieron.
3. Exploration across broader tenements and identified anomalies surrounding Havieron.
4. Low priority tenements JV to junior to develop exploration.
It’s a race between GGP building the company or being acquired.
The exploration potential is good, we have identified anomalies ZIPA and MECO, JURI JV and our 100% owned ground.
https://m.youtube.com/watch?v=EFs-1WYTYUY&t=144s
Nice video explaining the charts from a technical perspective. Spoiler alert! Looks good for gold!
https://m.youtube.com/watch?time_continue=1647&v=817XcyCnc88&feature=emb_logo
Kinross today acquired Great Bear Resources.
The majors are all looking to add ounces to bolster their reserves. Any junior developer/producer with a meaningful deposit will likely be in their cross hairs.
This, in my view, is the most likely outcome for GGP.
M and A is certainly hotting up.
We are in the phase of the Lasonde curve where IIs enter the share register as PIs exit.
They will not be taking my shares!
I look at GGP as a 5 year investment. What will the company look like in 2025?
Let’s assume Havieron reaches the >10MOz which broker says at current beaten up Australian mid cap producers equates to 24p valuation.
When considering if more ore bodies will be found over the next few years I see this as probable (IMHO). Next years focus on the identifies targets in close proximity to Havieron is a start, SD has expressed his eagerness to explore Earnest Giles and find partner to take on exploration for Tasmania assets.
Over next 4 years I see gold trading much higher, ggp will either be acquired or a mid tier producer with a number of assets in its books.
Im not a trader but an investor and therefore short term fluctuations don’t worry me especially when I look at my 5 year view.
Absolutely love the lizzy! I would have loved to have seen them live. songs: Opium Trail, bad reputation, sun goes down, vagabonds of the western world and China town.
I had a small punt in a couple of crypto, derisked took out my initial investment and will let it run now.
This could be a major catalyst to reinvigorate the precious metal bull. crypto has undoubtedly taken money which would have gone into the yellow metal.
Ready to pull the trigger on buys in my watchlist.
Have a great weekend all.
Well the FED just put a shot across the bow for cryptos.
This is brilliant news for gold. The hard asset could really shine, as investors look for a safe haven after crypto get smashed.
Markets can change in the blink of an eye.
Posted a clarifying message, look at bond market.
I am long gold.
Watching numerous buying opportunities developers and producers in my wish list.
I am staying well away from explorers with no income / cash to sustain themselves for a year.
GLA
Central banks and governments can talk about interest rate hikes and economic growth all they want.
Watch bond prices as a leading economic indicator flattening curves show the market doesn’t believe the sustainable recovery reflation expectations.
The drop in bond rate shows it doesn’t believe the inflation narrative, has no confidence that central banks will be able to raise interest rates.
Why? because we are no where near a real recovery.
My thesis is that gold is being held down by the illusion that recovery is strong and interest rates will rise.
However the yield curve is indicating the opposite, the market doesn’t believe the recovery is anything other than temporary.
The Recovery illusion is caused by supply demand, supply shock creating temporary stimulus to economy when in realty we are working through supply demand imbalances.
We find ourselves with the same weak economy we had before the pandemic shock. All of the economic problems that existed in 2018 have been exasperated.
Central banks have no easy way out of the crisis.
Lower interest rates continue wealth transfer from middle/poor to wealthy and old.
Raise interest rates indebted public/ governments can’t service debt.
The long term outlook looks extremely bullish for Gold!
Gold is looking jittery to bearish.
Must hold above 1750, if that is breached I’m bracing for a snap down to 1600’s as year end rebalancing takes place.
Interesting to note even some gold bulls are starting to express concern that the bull run has exhausted itself. I’m out of all junior explorers.
It now looks like a very good move by SD to have raised capital.
Could be very difficult to raise cash in the near term.
I’d be very concerned if I held stock in companies with high risk balance sheets no cash flow and insufficient cash to cover full year expenditure.
The next few weeks could be very bumpy.
Moments like these it’s always wise to review investment thesis.
Havieron is a tier 1 gold-copper deposit.
We don’t yet know how many Millions Oz we have.
NCM offer an experienced partnership with infrastructure providing one of the lowest AISC in the world!
2024 indicated as start for extracting ore-mining. (2 years)
GGP will be transformed into a cash generative producer/explorer.
SD has made no secret that the company are looking for a JV to explore the Tasmania tenements
GGP has cash to explore other 100% owned tenement, Ernest Giles, Canning,
I would like to see the board have more skin in the game, buy stock on the open market.
It would go a long way with PIs if thy take a salary sacrifice until we become income generative. Delay payment of a % of salary until income milestone is achieved.
That would go a long way to give confidence to PIs and send signal that the board understand taking large salaries whilst the company doesn’t generate income isn’t a good look.
GGP is in my SIPP for one reason, to delver me the financial freedom to retire in the next 5 years.
We are ready to go, go, go 2022 is going to be a busy year.
GLA
Thats this weekend work.
I’ve created the structure of analysis for the different mineralised zones.
Tonight though syd I’m having a couple of beers. Taking some lovely IPA to task! ;)
The 2 year is rising and 10year dropping, flattening the curve. This is a leading economic indicator (inverted yield curve is a predictor for recession).
The market is saying the UK economy is not rosey, BOE planned interest hike to address supply chain constraints (supply/demand) inflation is counter productive and responding to reduced bond buying (tapering).
The US is planning similar measures , the UK yield curve is giving us a glimpse of the market response.
good for gold.
GGP are in an enviable position of small part developer and explorer as the heavy lifting of capital expenditure is carried by NCM. Development and exploration is happening at break neck speed. With a board at GGP who are proven, credible stewards for the task at hand.
Exec summary as requested:
Macro picture is good for gold. Gold best correlates with US deficit spending and US 10 year -tve real rate
Persistent Inflation scenario very bullish only if the inflation is not as a consequence of strong underlying economy (which would be -tve gold).
Deflation scenario Gold would initially drop with slowing economy but then rebound strongly with government stimulus.
US is underpinned by wealth creation from stock market.
Commodity Cycle
1. Understand where we are in the commodity cycle. Don’t fight the trend.
2. Valuation should assume flat price of gold.
Segment Companies Senior - Junior:
Producers
Developers
Explorers.
PRODUCERS
Net Asset Value
Senior 1.1 X
Mid (250k oz production/year) 0.75 X
Junior 0.6 X
Reserve Life
Free Cash Flow 5%
Risk Transition
Wealth Creation Rate of Return over a sustained period of time.
Producers must find more gold than they produce per annum to keep growing the company.
DEVELOPERS
Capital To Build Mine. CAPEX must be fully funded. Watch outs if companies try taking short cuts in development costs I.e. leasing trucks and equipment.
Valuation
Free Cash Flow
Risk Transition Typical market discount 17%
Wealth Creation. Profit after all costs over life of mine.
EXPLORERS
All about credible, expedited management.
Does not invest until consistent grades have been found.
Determine Finding costs=Value for Amount of gold found-cost of exploration.
Questions to ask board of junior:
What is the thesis for exploration?
Are you planning to build a mine?
Have you done this before? And have demonstrated success in same jurisdictions, geology and task at hand.
What is the question you need to address first?
Are you fully funded to answer that question?
What is the company worth today (take out or liquidation value)?
Put another way, If the company sold its tenement rights and assets, how much would you get?
What is not going as well as you’d like? - The CEO who answers everything is perfect nothing is going wrong should be viewed sceptically.
How many people are on payroll?
What is the % annual expenditure going towards exploration and exec remuneration?
There are lots of bad actors in the junior exploration space taking salary and enjoy in the trappings of the role. exploration is a race between making a discovery and spending cash. Be sceptical of CEOs who take hefty salaries, if they believe in the project and their ability to deliver they will be rewarded handsomely when the discovery is made.
Too many PIs pick companies on PR and hype , nothing else. (I’ve done it).
Use these questions when interacting with any junior explorer your researching to expose