Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
LUFC1111
Yesterday I listed a number reasons for the share price weakness. Whilst the current share price is disappointing, the incentive to keep holding JLP is the upcoming copper earnings. It would be a shame to sell now when JLP is on the cusp of a major step up in earnings. It makes sense to be patient and assess the situation in another 6 months. In the meantime, I will be praying to my atheist god that JLP don't screw up again.
NatCoalKing
You make a valid point and JLP's market cap has increased significantly over the past 3 years. I suppose grumpy people like me hoped for a better share price for taking that risk.
NorthernShark
Yes, my estimates are based on the estimates that JLP published, i.e. 29,600 tons per annum by Q4-2023. I am using 25,000 tons with earnings of $4,000/ton to give $100m per annum. A very handy and appropriately conservative sum and a key reason why I stay invested. But this estimate is almost 2 years away and my concern is the potential mistakes JLP will make between now then.
JLPositive,
I have read the RNS carefully, there is absolutely nothing that says ACAM is going to hold their shares. If you referring to welcoming "ACAM as a strategic shareholder", that statement doesn't mean anything, its just JLP spin.
Gray1
This exactly my point, JLP did not have to expand, they could have focused on PGMs and been another SLP, at least until they amassed a healthy cash balance. Instead, the did a bad funding deal and massively diluted the stock over the years.
Now we are at a similar junction, JLP can just focus on what they have and get on it or they can talk about global expansion. Given how they have funded their expansion in the past, what type of investor is going to be excited about future expansion. On the contrary, it would make investors nervous.
Maybe somebody can explain this. When ACAM converted part of their loan and accrued and unpaid interest on 15-Jan-21, the remaining loan capital was $5.5M. Yesterday they converted that and unpaid interest to 209 447 822 shares at 2.81p so GBP 5,885,483 (USD$ 7.7M). So in just over year they earned $2.2M in interest, super dodgy or am I missing something?
And for those who care to remember, the ACAM deal was not to keep the lights on, it was to progress the Zambian expansion.
gotreal...I still hold 3.7 million shares (long). I hold one other stock, I sold everything else. I will "troll" here as I see fit.
NorthernShark
By all means, stay invested here, it could work out fine, but don't believe everything you hear/read. After following JLP for many years I have learnt to be very critical of every comment they make.
ACAM: The only intention in the RNS relates to providing funding. ACAM bent us over nicely on the last deal so of course they are keen to bend us over again (having made over GBP 35 million for lending JLP USD$8m with a secured loan). There is absolutely nothing in the RNS that says ACAM plan to hold their shares so they are under no obligation to hold their shares. Do you see ACAM as a large shareholder on the register, I don't. The never held the 80 million shares they converted in Jan 2021. Suddenly they are now a strategic shareholder, hmm yeah right.
Copper: Good luck with that expectation. Based on JLP's history they don't do this, they just tell you well after the expectation milestone has passed.
Global strategy = dilution: How many times have we heard that projects would rely on debt funding. How many times have we heard no more dilution, blah blah blah, the point is that JLP's credibility is shot regarding this topic.
For those wondering/complaining why the share price has not ticked up with the recent PGM prices, it is worth considering:
- The expanded PGM production capacity at Inyoni was below expectations. JLP set an expectation (I didn't believe them) and then delivered the bad news at a later stage.
- ACAM LP's intentions to hold or sell are unclear.
- Copper earnings post ramp-up are not yet known. I don't trust what JLP says.
- Global strategy plans adds to uncertainty and risk of dilution.
- Current expansion plans, i.e. copper rollout and Eastern limb PGM plant adds more risk of dilution.
- Earnings will be down year-on-year (even with the recent uptick in PGM prices) so there is some bad news still to come.
For those JLP devotees enraged by the above comments, take solace in the fact that if JLP's copper expansion goes to plan and they stop the dilution rampage and don't make any huge mistakes, the share price could hit 30p in 18-24 months.
MikeSunday, I am comfortably long and I rarely trade JLP for short term gains. Anyway, that is not the point. Your post today once again demonstrates you know very little about JLP and your thoughts about the ACAM deal were clearly incorrect. Instead of going back at looking at the original RNS (which BillyBoy kindly posted) you choose to call upon your flawed memory. Most participants on this board want facts, not opinions/thoughts and nobody wants to read statements that are false. Homey doesn't want to clean up your mess so put a bit more work and less thought into your next post.
MikeSunday
Read the original RNS and correct the numerous errors in your post.
agdevil
Your understanding is correct. It is disappointing to see JLP are "pleased to announce" such news, but it was always going to happen some time this month given the ACAM convertibility expired this month. This is hopefully the last horrible funding deal JLP will ever do. The ACAM deal ranks as low as the Darwin deal.
MikeSunday
JLP gave an indication of the Rhodium content of the eastern limb feed, but feel free to keep wondering.
MikeSunday
I and other posters have given you detailed earnings estimates based on chrome, PGMs and copper. You continue to ignore those figures and come out with some random comical method of calculating earnings devoid of common sense. So yes, I am going to pull you up for it.
Mikesunday
The PGM basket price has not hit $3,200 this financial year and is about $3,050 based on today's prices (including the overnight spike). But hey, if you want to use $3,200 as your price for estimates, don't let common sense stop you.
As for treating smelting costs as some miscellaneous expense when its $400-$450 per oz, well that is just plain stupid. Come back when you can put a sensible set of figures together.
Mikesunday
You keep banging on about earnings being in excess of $10M a month and even though multiple posters (including myself) provided detailed estimates to the contrary, you persist with your excessive estimates. I am unable to discern if you are just stupid, desperate to believe in some romantic fantasy or just want to ramp this stock as often as you can.
As for the capital raise, it could happen at any time, most likely to support the Eastern limb expansion. For those of us, less biased than yourself, it is easy to consider that a plant acquisition or construction budget could be in excess of GBP 20M. You can also consider that JLP might want to acquire tailings dumps outright and spend another GBP 10M. But rather than consider this, you prefer to mention the price of cobalt which has no relevance for JLP over the short term.
SeisNav
Your memory is not very good. My post on 12-Aug-2021 was as follows:
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The PGM tailings from the Eastern limb are estimated at 16 500 / month to deliver an estimated 14 500 oz per annum (or 1,208oz per month). The Eastern limb tailings suggests a yield of 0.073 oz per ton. So if and when the expanded Iyoni operation hits it’s target capacity of 75,000 tons of month the PGM ounces produced should be:
16,500 * 0.073 yield = 1,208 (Eastern Limb tailings)
58,500 * 0.045 yield = 2,632 (Historical/Other tailings)
Total is 3,840 oz per month for annual total of 46,080 PGM ounces.
If the Eland operation is no longer contributing to PGM production then JLP could be heading for around 40-46K PGM oz for FY 2022 (after considering the outstanding construction, commissioning and ramp-up of the expanded Iyoni operation).
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I will accept your apology in advance.
MikeSunday
I don't know if you know how to play poker but a RNS beats a broker note. As per this week's RNS
"Jubilee now holds an annual PGM capacity that consists of up to 44 000 PGM ounces at Inyoni (previously only 30 000 PGM ounces) with the additional option of accessing the Windsor PGM JV at a capacity of 16 000 PGM ounces"
As for the copper 25Kt pa target in 4 years. That target was released in August 2020 and the current copper production estimates have JLP hitting that target 6-9 months earlier (end of 2023).
SeisNav
Leon will be right. Yesterday's RNS states:
"Following the recommissioning of the integrated Inyoni operation and the restocking of the in-process pipeline the expected production target for the full financial period is readjusted to between 43 000 to 48 000 PGM ounces depending on the supplementary production achieved for the remaining period through the Windsor PGM JV."
Gees, you can lead a horse to water, but you can't make it read a RNS.
Dorfan
My holdings are in the millions. No need for any bets, a constructive debate is much better.
Regarding #1: Forget this comparative, it was a insulting distraction. JLP published their PGM production guidance, focus on that.
Regarding #2: We have the copper production estimates published last year. Use those and adjust for delays.
Regarding #3: Please find me a reference that cobalt will be produced in the current half-year.
Here are my FY21/22 estimates based on actual H2 2021 results released yesterday and the 6 months to 30-Jun-22.
PGM earnings
H2-2021 GBP 14.96m
H1-2022 GBP 28.75m. This estimate is based on 25k oz (JLP's PGM guidance is 23-28K oz) and using GBP 1,150 earnings per oz. The earnings per oz is really difficult to estimate for the current half-year, given the expected volatility in the PGM basket price and increased exposure to rhodium prices. Throw in the transport costs and it becomes a broad range of estimates.
Chrome
H2-2021 GBP 2m
H1-2022 GBP 3m
Copper
H2-2021 GBP 3.215m
H1-2022 GBP 7m. This estimate is based on the copper production estimates published last year, adjusted for 1 month delay and using the same gross margin as published in H2-2021. Once again, it is difficult to estimate for the current half-year because the copper ramp-up will vary the gross margin significantly. The risk here is to the down-side, so best to be conservative. We can't expect JLP will be running the copper business at its estimated cost per ton from day 1, this will take many months or even a year.
Cobalt
Zero earnings. Let's be pleasantly surprised if it happens as there are no indications it will happen in the current half-year.
Total project earnings: GBP 59m (vs GBP 71m for 30-Jun-2021)
Of course you need to factor in group expenses, increased tax rates (little to no retained losses left), blah blah blah. You also need to factor in more shares on register compared to 30-Jun-2021.