Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
We are all clearly singing from the same hymn sheet on DKL, but not always in tune. Let's hope for a better 2024 and in particular a complete ramp up of the cashew facility.
On that note, a Merry Christmas and all the best for 2024 to regular DKL contributors as we head in to what must be going on around a decade of service to the DKL cause.
HarChris, there is surely no better case of "personalising the debate in what appears to be an attempt to stamp out alternative views" than by accusing posters of being 'stale and old', followed by telling them they should have sold up long ago.
Why would anybody sitting on a paper loss of 90%, due to a combination of factors - but mostly dilution - bother to sell?
That energy is much better spent holding the boards feet to the fire and hoping for the best (i.e. taking a punt) that things will improve in time.
Zak Mir puff piece at 4:29:
https://www.youtube.com/watch?v=aJrXaJRKvE8
Harchris, the board can't take credit for this apparent turnaround in the same way that Rishi Sunak can't take credit for "halving" inflation. One swallow doesn't make a summer.
You seem to be forgetting that any supposed profit from this record November has already been wiped out - by the cashew facility still sitting idle.
Sorry if you only like to read good news and not 'deramping'.
Simo, I can't say I'm overly worried at this point despite the recent sell off. It's nothing we haven't seen before after large sales, there's a domino effect of others piling in and a race to the bottom.
It's clearly not good, but if they can get the cashew facility up to capacity - bearing in mind it's now the best part of 3 years late, despite the rhetoric - then some positivity should quickly return.
The simpler explanation is that - not for the first time - we have a 'follow the leader' mentality of shareholders.
They could have just lost patience like rugs / bored of waiting / following their strategy when a share drops x% / insert your own reason here.
On the basis of no news is good news, then this appears to be based on nothing whatsoever really. We had the usual DKL non-news last week with forward guidance, but if you're selling based on that, then you don't really know DKL.
I'd suggest a big part of this is the proverbial noose around the neck which is the cashew facility and its ongoing delays. If the board came out and said "sorry for the delay, all should be sorted whenever", then we wouldn't all have a wet finger in the air trying to figure out which way the wind is blowing.
As it is, the cashew factory was supposedly finished two years ago and we just have a faulty shelling machine - apparently.
At these prices, they should also be looking to buy back and cancel some shares. Or, heaven forbid, buy some of their own.
WH Ireland retain 9.5p target.
"October production update: Well positioned for strong end to year in palm oil
This morning’s October production update from DKL further underpins strong expectations from the group’s palm oil business this year, with crude palm oil (“CPO”) production tracking ahead of the prior year for the 8th consecutive month. Positively, the company also report a promising start to November, with CPO production expected to be ‘materially higher’ than FY2022. Approaching year end, we remain confident of a very good performance from the palm oil business in FY2023E, validating expectations of a close to record financial performance from the palm oil mill driven by a combination of solid volumes and strong pricing. On the pricing front, we note the decrease in CPO pricing on both a monthly and YoY basis in line with international price movements; however, prices remain significantly higher than historic averages and at levels providing a strong return for DKL’s palm oil mill. Dekel is an increasingly diversified agricultural group with operations in West Africa, comprising a fully operational, sustainably sourced palm oil business alongside its recently inaugurated cashew processing activity. While the group did not update on the latter this morning, we highlight the significant upside this project presents as the group continues to ramp up production going into next year. With a strong showing from the palm oil business this year and expectations of a step change in profitability as the cashew project is bedded in, we retain our current fair value target of 9.5p."
Dropside, I believe Shai Kol lives there (he's always there in the conference calls) and Lincoln seems to visit a few times per year.
2magpies on the other side sums it up quite nicely:
"When prices are high, they have nothing to sell.
When they have lots of feedstock, the machinery won't work.
When they order new machinery, it is delayed.
When they take delivery of machinery, there are parts missing (or unsuitable)."
Hi rugs, you've always been a loyal passionate supporter of DKL, so that would be a shame to lose you.
DKL has become a punt for me rather than an investment.
I think if given enough time, then things should turn, but we are all literally running out of time!
For anyone with a large paper loss, I still see this as a good buy in opportunity to average down, with the proviso that you don't want/need that cash for a long time and/or ever again.
Unfortunately, the BOD are in 'fingers in ears' mode on any shareholder complaints, so will carry on regardless.
HarChris, you've clearly picked a point in time (January 2022) that fits your narrative, so let's look at the data:
Total issued share capital:
2016 - 154,326,632*
2017 - 295,995,774
2018 - 299,471,369
2019 - 353,341,082
2020 - 423,895,851
2021 - Can't find data.
2022 - 537,098,441
2023 - 559,404,153
Source: dekeloil.com / dekelagrivision.com
* 1,543,266,322 before 10x consolidation on a 10 for 1 basis in June 2016.
That looks like a lot more dilution than the 0.15% you mentioned last week and 4% earlier today.
Totally correct dbentley, the issue is as the dilution occurs in dribs and drabs, some holders/passers by are taken in by 0.15% here and there, as if it doesn't matter.
They even claim that we are "deramping" by constantly complaining about it.
It's also always done at a premium to yesterdays close, which in itself is lower due to previous dilution. Well here's the thing, the SP is down at 2.4p - how much further can they realistically dilute?
DannyQSee, you're correct on most points, but the cashews should be at break even by the end of this current Q4.
They're at 13k-14k tonnes now, even with all the issues, so 20k break even point sounds easily plausible within 8-10 weeks. 24 months later than expected, but it is what it is.