Member Info for JMUK26

Really didn't expect to see this back under 25p. We are slowly creeping back down to where we were before the SPA announcement seemingly losing 5% each day. Are AIM investors really this impatient (I think i know the answer)? Do they think they can get back in closer to SPAC listing, and have made more elsewhere? The valuation discrepancy was literally spelled out to the market with that announcement and all they have to do is still still for up to 6 months to see what should be a big re-rate. The valuation didn't even account for the more lucrative scalable side of the business which could list separately for likely twice as much. These days AIM just seems to be a very illiquid pump and dump market, it's very frustrating and certainly does nothing to entice new investors in.

I think you have some fair points Taser, but maybe a tad pessimistic on this company becasue you must be concentrating on the share price rather than business fundementals. If we look purely at financial performance and ignore management opinions or outlooks and share price, then we can see that the business has performance very well over the last 10 years with very consistent growth and a fairly stead rise on all metrics. Examples:

-Turnover increased from 9m to 83m. Set to rise to 97m this year.

-Post-Tax Profit increased from 0.6m to 4.8m. Set to rise to 7.7m this year.

-EPS increased from 5.5p to 26p.

The share price went up wildly to ridiculous levels in the past and reached valuations that were simply ridiculous (management cannot control this). The PE ratio was over 50 for long periods. The company has now grown into that valuation with stronger performance over the last few years and a drop in share price meaning is is now looking fairly cheap, but not absurdly so imo. Management could buy some shares I agree, but De Souza will not realistically buy more with such a large holding already. Agree with you regarding cancellation of purchased shares. The share price has been dissapointing and seems to have largely stayed still for about 6 years, but that's only because it was so overvalued in the past. I don't own at the moment but i do flip flop in and out of this one. Todays price looks a good buy in price.

Hi peter, I've done as you said with Chat GPT and here was it's conclusion of your post:

"The post uses selective truths (like production volumes from the DFS) to establish credibility, but then injects significant falsehoods and highly manipulative calculations regarding revenue and costs to create a severely negative and inaccurate picture of Mkango Resources' projects. The core argument of the project being unprofitable is based on a fabricated financial model that drastically underestimates revenue and arbitrarily inflates costs, directly contradicting the company's publicly available Definitive Feasibility Study and recent market valuations. Investors should always refer to official company reports and independent analysis rather than unsubstantiated claims on public forums."

I think like others, I will be blocking you.

I do wonder whether he will load up close to 30% and stop, or whether he is planning a takeover. Suspect the former but you never know as it's strange to just start again now after quite a long break.

To answer query below, the RNS explains what was voted against in the AGM. Consolidation of shares will occur, I think i read 20th July.

That is the saving grace here. They will do whatever is possible to avoid dilution.

Thanks for that. Still a holder Guvvi?

Cheers Guvvi, assumed it was also due to large overheads as well as funding investment through debt but I think you are probably right. A few years ago, when case resolutions were very sparse, debt did no soar, so makes sense. I'll need to investigate accounts further at some point.

LCM have promised the world for years and not delivered unfortunately despite the strategy sounding good - albeit lumpy - on paper. At the current time, all us holders can do is give the strategy more time and hope the performance picks up. I expected some poor years but always expected the good years to far outweigh any bad years and at the moment that has not been the case. The snowball just cannot get rolling....

Contacted LCM about cashflow and they stated that they plan to update the market as planned in September and not before. I therefore take it that there are no major concerns with current position / debt covenants etc despite that debt pile accumulating in the recent RNS. I think it would have been prudent to make this much clearer in the RNS though or give a cash runway as it's the doubt that has crashed this and management comms haven't helped. LTH's deserve some good news here for once.

Agreed Ed. AIM is just crazy sometimes with extremely short term thinking, it's no wonder businesses are increasingly wanting out. I've sold up some other fairly sedentary holdings and made a big top up here. By year end I'm fairly confident we'll be closer to fair value than today, but braced for a rocky ride.

Do we think that the fund 3 marketing was halted purely due to the unknown tax situation as stated? I'm hoping is wasn't a cash saving exercise (on marketing etc) until more realizations come in given the torrid run and the growing debt pile.

Yes you are wrong, it rose 50%, then dropped to around 30%. The day after more of the same. I'd expect a positive finish today, but if not it's all just part of healthy profit taking and churn.

Look at comparable companies listed on the NASDAQ I guess.

In terms of the mines not being viable, you are being backwards looking while the market is forward looking. China current effectively sets the price, but if the rest of the world wants to be more protectionist and secure their own supply chains, then the current subsidized prices are largely irrelevant. Companies will have to pay the going rate from mines in the western world. Other posters will put this far more eloquently than I have done who know far more about this stuff. You are clearly trying to de-ramp and failing miserably.

Perfectpeter - probably best to give some valid counter-arguments about why you think the stock price is in bubble territory and will crash imminently? These sort of loss-making early years companies aren't my usual type of investment, and if I was looking at the share price from outside I would think this could crash back down at any moment and if just being pumped for a few days, which is what you are clearly doing. The reality here is that we have a confirmed listing valuation which sets a line in the sand and proves the AIM valuation was absurd and there is still a logn way to go to even get to an adjusted valulation with a margin of safety. Then we have the recycling news on top, which will be the real money maker over the next few years providing they can effectively roll out. Whilst the ride will likely be volatile, it will -barring unexpected bad news- be an upward trajectory over the next year and onwards. You will not be getting back in at 15p i'm afraid.

Large rise in SP this morning. Anyone know whats going on? Possibly large institutional buying? Takeover?

The only news I can see is that Sharewatch covered it over the weekend and hinted that he would probably add it to his portfolio. But I wouldn't expect this sort of rise from that comment alone!

Well the valuation figure released implies a listing value of minimally $400m, but in reality it will be more. That implies an SP of around 90p. If we discount it by say 20-25% for risk then you are still looking at 60-70p. This doesn’t even account for the remaining and probably more valuable part of the business. We could either see a quick rise to near the above figures or a slow creep up as the listing nears. Impossibly to say really. With AIM it will probably be a very volatile ride and a frustrating one.

It's awfully quiet here. How has there not been 1 single post since my last one of 3rd June. The company is subject to takeover and still can't garner up any interest whatsoever. Only a few days left until we get some sort of comms.

Liontrust have always been an active investment manager. They aren't changing their philosophy, they are just hoping/predicting the world will shift away from passive and more towards active which would see them as beneficiaries. One things for sure the valuation expansion we have seen in global passives for the last 10 years or so can't just keep going indefinitely. The outflow from LIO products is going on for longer than I hoped for though. The change to the dividend policy is fair in my opinion under the circumstances though. It gives the company plenty of headroom for multiple years of potential under performance, and cash in the bank for acquisitions, buy-backs and dividends. If the company got back to their 2021 levels of EPS, that would be a circa 12.5% yield which would be very good in a rising market. If we assume a fairly poor 40p EPS next year (below forecasts) that would be circa 5.5% yield. If performance is similar to this year it will be 8%. Worth holding onto for a few years, as you get a decent yield for waiting and in the meantime there could be valuation expansion if investment into smaller British companies picks up again (it will at some point).

Agreed, looks a good deal to me, and no problem with the dilution in order to achieve it as long term is should pay for itself many times over.

Agree with Spades. The SP was at around the 2.45p mark at the time of the offer so that is what would have been agreed in principle at the time with the various parties. The SP then went up to reflect the acquisition and what good of a deal we were getting. You can't then move the goal-posts for those investing, as the SP only went up because of the money they have promised to acquire said business. Ideally they should have allowed PI's in though as it just shows some willing.

And not sure if ihalliwell10 is scare-mongering but why on earth would the consolidation affect the share price to any great degree? The valuation metrics will be exactly the same, you will just have 1 share in your account for every current 20 shares. On the day, if anything there may be some buying from novices. It makes absolutely no difference to us investors except when buying. If you had only £10 to invest you can currently buy shares 350 shares and have 3p in change. With the consolidation I could buy 17 shares, and have around 30p change, so it makes no difference until you get to huge share prices. Laughable that you think this will go to 1.5p / 30p post consolidation. If it was going to do that it would already be there.

Personally I don’t see the issue. Takes them out of penny stock territory, where many investors still seem to think that if a share price is still on pence it is not reputable, and going from 3p to £3 doesn’t affect the number of shares you can buy. I think it will be a good thing personally.