Member Info for KingSuarez

Capex should be coming down 'soon' - most of it has been spent on growing water handling facilities, which is 'one-off' infrastructure costs (the value not reflected in the share price). At some point, once production growth reaches a plateau there will be less need for this water handling capex and that can be re-directed towards dividends/buybacks? The erosion control stuff, although unwelcome, should not be a re-occurring cost in future years?

Crux do much better interviews than most

"Malaysian production was 5455bpd in H1 24. Current production is 4400bpd. With just Skua coming on board around the mid year point, those guidance figures for 25 could be a challenge."

And yet despite this decrease the company ended the year at record production rates of c24k bopd?

Charlie,

The $19.5m 'finance costs' in H1 2024 are not a true cash cost (which is why it is adjusted for in the cash flow statement). $10.5m of that figure relates to 'accretion expense' which is an increased accrual for asset retirement obligations, which increased due to increased ownership of CWLH and Lemang.

The ACTUAL cash interest expense on debt was $3.4m, which I would expect to increase to closer to the $17.7m for FY 2025 as per my earlier post, since that is the only debt JSE carries and we know the contractual terms.

yes, it was quite a penal hedge (they were up **** creek and committed to akatara development costs), but hasn't been that punishing as the oil price has hardly been flying much above the hedged rate lately. more than half will be unhedged now as jse are producing more oil than when the hedges were placed.

if they are correct on the forecast fcf generation, then jse should return to cash neutral by mid 2025 and the rbl would be paid off in full by end 2026? likely recommencements of dividends in early 2026 unless some big acquisition comes to the table?

How do you work out $40m financing costs per year? The RBL is $200m at 450 basis points over SOFR (which is currently 4.34%) so 8.84% = $17.7m - and that is interest on the full $200m, which of course will be being paid down throughout the year?

Jadestone were forced to hedge 50% of forecast oil production out to Q3 2025 as a condition of the RBL at a weighted average price of $70.66 - that is where the unrealised hedging loss comes from. So far, oil price has averaged higher during the period.

I pay 15% withholding tax (broker is AJBELL). They have forms on their website for dealing with US and TSX listed stocks. If you fill those out that should be all you need to do. If your broker is one of the banks, like Lloyds, then you're out of lucky - they simply will/cannot administer the WHT correctly and you'll be deduced 30% instead of 15%. As far as I'm aware there's no way to avoid the standard 15%?

Don't encourage him...

Sloppy - it's a guesstimate. Maybe I am being too optimistic, but management have said they anticipate AISC dropping to $1k or below with the plant upgrade. I guess the level of depreciation is an unknown - that will run higher due to depreciating the new equipment and depleting the ore faster.

They have upgraded the plant to increase production, and this is going to cost a little extra in electricity and fuel etc but not an extra $22m a year to run? A lot of the expense is surely in the mining, for which they already have the fleet in place and have been mining closer to capacity that milling (hence the increase in stockpile).

I feel like a c15% increase in COS is not unreasonable? There will surely be some economies of scale with the greater processing power so I would not expect costs to rise proportionately with the level of production increase. The annual inflation rate in Kaz is currently 8.9% FWIW.

52k oz x $2,800 = $146m revenue

Less cost of sales assumption = $50m (was under $22m for HY 2024) - assumed increased due to inflation and MET @ 8%

Less admin = $5m

Less finance costs = $6m

Profit before tax = $85m

Less tax @ 20% = $17m

Profit after tax = $68m

Profit after tax = £54m

Ok, £54m I make it.

You must be assuming a huge cost increase to only get £25-27m profit?

FY 2025 @ 52k oz gold production is likely to deliver close to £60m of profit after tax. This should be at last £200m market cap on those metrics i.e £7 or so per share, and that is not expensive at that price either? The market is very slow to respond, albeit in the right direction.

Translation:

Hello my name is BigBananaBob, unfortunately I was unable to trade the move up from 30p as I was flying somewhere. I am now on a mountain somewhere. When I return to lower altitude I will be able to get on my mobile phone and post more messages on the bulletin board.

I think that is about it?

Ah banana bread, I wondered where you had disappeared to! Away when the share price rose from 30p to 40p and back with doom spreading once profit takers appear. Like clockwork :)

Hi Kingfisher68,

I am a holder here, as well as PTAL and AXL.

"what are the catalysts for turning this from a shareholder-value-sucking disaster zone into a 'bagger'?"

All that needs to happen is for them to maintain operational uptime of all current assets going forward. Now that Akatara is contributing, this will pay down debt very fast, at which point JSE becomes less risky and very cheap based on the improving enterprise value to cash flow rate.

JSE is cheap because of the Montara disaster (and response to it) not because current assets are poor.

I hope not (yet). Need more time to prove up reserves and increase production before a fair value offer!

No they do not have double the exposure. I corected you on this yday. Suee have 25.9% and MFAI have 19.1% - you keep ignoring MFAIs indirect investment in SVV1 due ro their investment in Sure.

I think it'll be a little better than that. Revenue around $90m for full year agreed, but profit after tax I'm hoping will be closer to $25m, though depends on the level of depreciation and fx translation etc.

Dividends a strong possibility going into 2026 - the plant running closer to 60k oz p/a and will be swimming in cash!

SCGL was/is bonkers imo. A loss making business with £70k in revenues, and net £1.5m in liabilities merging with another business that hasn't even launched it's flagship product and it re-rated to a c£35m market cap at one point. Oh and they gained access to death spiral CLN financing - that always works out well for the share price!

This company at least has some tangible value.

As I said earlier, I make no comment on the value of the rest of the investments. The board themselves valued everything at £7.5m in the interims?

Now one of the investments has gone up near 2.5 x since that date. Clearly the market likes what iR is doing. None of us here are in a position to value the rest of the investments, unless we are inside the business?!

Clearly the management have been astute enough to pick at least one winner so far.. perhaps that deserves a premium on any current NAV? Management are usually the most important assets of any business and I can't model that - I'm just an interested accountant :)