Member Info for Major4legs

I ran some more numbers including Dupax projections - assuming the drilling shows commercial grades. Exciting times and for the patient willing to wait until 2028 very exciting times.

Bear Case Base Case Bull Case

Gold Price $2,200 $2,700 $3,200

La India FCF $180M/year $240M/year $290M/year

Dupax FCF $60M/year $108M/year $130M/year

Total FCF $240M/year $348M/year $420M/year

FCF Multiple 4× 6× 8×

Implied Valuation $960M $2.1B $3.36B

Shares Outstanding 3 billion 3 billion 3 billion

Implied Share Price £0.25 £0.70 £1.12

Assumes GBP/USD ~1.25

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🧠 Interpretation

•⁠ ⁠Bear Case (£0.25): Delays at La India or Dupax, or weaker gold prices. Still 2.5x today’s price.

•⁠ ⁠Base Case (£0.70): Successful ramp-up of both mines, moderate gold tailwind, prudent capital return policy.

•⁠ ⁠Bull Case (£1.12): High gold prices, strong margins, flawless execution, and market re-rating on dividend + possible up-listing.

It’s an interesting question as to why gold miners are so undervalued on fundamentals. ETFs which now offer exposure to gold, bitcoin and institutional fear of a sector that has been prone to over leveraging and dilution in the past might explain it. Or maybe the market is still catching up with golds rapid rise and is worried about volatility in the price

MTL sells semi refined dore bars - which have a price about $50 below the spot price so for our illustration purposes it doesn't makes a huge difference

A superficial look at Mineros suggests that it isn't anywhere near where MTL will be in 2 years. Its valued on about the same multiple as MTL is now which is probably about right. Who knows what multiple will actually be applied to MTL by the market in 2 years but I think 10 x FCF will be a fair valuation for what is forecasted here. I agree that a 10 x FCF valuation in Q1 2027 would place MTL at the higher end of small -mid cap miners but the numbers suggest thats the type of beast we have here! Until the market sees the results at La India and MTL is de-risked we will probably be valued like Mineros. What I found interesting in todays presentation was the (gentle) attempt to play off 2 different jurisdictions. Having production in both, and being able to move capital to whichever is most accommodating, de-risks the company and provides leverage. The fundamentals here are very impressive. Personally I am not really bothered if the market doesn't wake up to them in 2 years time, happy to wait a bit longer for dividends. I came here from Condor so the opportunity has changed considerably for me but I appreciate that others will have a different history with MTL and may not be willing to be so patient.

• ⁠*Revenue* = 145,000 oz annual production × $3,000 = *$435 million*

• ⁠*Operating cost* = 145,000 oz × $1,176 = *$170.5 million*

• ⁠*Gross profit* = $435M – $170.5M = *$264.5 million*

• *Tax (30%)* = ~$79.35 million

• ⁠ ⁠*Net income* = ~$185.15 million

• ⁠*Sustaining capital & other costs* (assumed) = ~$20 million

• *Estimated FCF* = *~$165 million annually*

•⁠ ⁠At *10% FCF yield* (discounted valuation):

Market Cap ≈ $165M ÷ 0.10 = *$1.65 billion*

No dilution with 2.92b shares – share price = $0.565 = £0.40p

So I make fair value for MTL if La India is fully priced in at $3k gold (no need to argue over that!) – 40p

Of course we will lots of other news over the next 6 -12 months to increase this

Yes fair enough- in the long term almost any asset is going to perform better than currency- historically equities are best probably followed by gold and real estate

Very happy to shut up and focus on MTLs prospects if others agree to stop making unfounded claims like “there is a general consensus that gold will continue to go up”. There isn’t. Agree that no one can predict future gold price movements. Excited to hear what MTL have to say tomorrow.

Recent events and FACTs don’t support the gold bug conspiracy - following Israeli attacks the market responded according to conventional theory- oil up 7% and both USD and gold up over 1% as free capital sought traditional safe havens. Both theories correctly predicted gold price increase caused by geopolitical volatility but gold bug theory was proved wrong by obvious move to usd despite high debt levels

Https://www.ft.com/content/5788dbac-7680-11e0-b05b-00144feabdc0

Always a good idea to base your opinion on facts not bias

The old Gordon brown sold the gold trope! Yes at current inflated prices it might have cost us £30 billion but that ignores what he did with the £3.5 billion- if it was invested in infrastructure the multiplier would have created much more than £30billion over 20 years. It also pales into insignificance when compared to austerity which cost 200,000 excess deaths and hundreds of billions in lost growth

It’s not as simple as you make out. Japan has highest debt levels in G7 - 237% and Germany the lowest - 60% yet average growth over the last 5 years is broadly the same 1.12 and 1.16 equally sluggish- it’s not QE or debt that is the problem.

Ah the old Austrian economists argument. God help us. We only have to look at the damage their ideologically driven acolytes have done to this country to see the shortcomings of their theories that have no basis in data or fact. QE worked. It kept the lights on after the Austrian school of deregulation and free market anarchy came close to wiping out liberal democracies as banks were allowed to take huge risks chasing profits. If you think QE will bring about your gold bug theocracy you have to explain Japan.

Gold bugs must have a fundamental misunderstanding of capitalism - of course a FIAT currency is going to depreciate in a functioning capitalist model - inflation/growth will do that! If the system works assets will outperform currencies and increase in value when measured in currency! That doesn't mean that the asset will become the fixed value against which currencies are measured - we tried that! It didnt work and was abandoned 50 years ago. Equities have proved to be a better investment than gold when averaged over the long term and in specific cases like now the case for buying MTL over physical gold is a overwhelming. That could change - global recession, WW3 another pandemic or some other dystopian horror! Or we could all be totally f****ked if Trump believes gold bug nonsense and revalues US gold reserves from $44 p/oz to market prices and sells the lot flooding the market with gold and crashing the price!

Unfortunately golds status as a safe haven will se it rise in volatile times. My point - as always - is to refute gold bugs assertions that the rise is because of the collapse of FIAT currencies. Gold is generally a reliable store of wealth and hedge against inflation, but timing is important. Buying physical gold now might not be wise. i downloaded a dataset of the POG at the start of every month since 1971 and then ran a script to calculate the probability of the POG rising after 3 months, 12 months, 5 and 10 years. For 3 months the probability was only 29% - it did go up to 60% over 10 years but it doesnt support gold bugs conspiracy that gold is ALWAYS a reliable store of wealth. Much better to invest in MTL where you leverage on any gold rise is multiples and even if gold falls you will still get an impressive return.

Unfortunately gold is rising off the back of a fear of war in the Middle East - Oil is up 5%. MTL has been rising despite gold going sideways for 2 months. Let’s hope for peace and no rise in gold. This share doesn’t need it.

I cant see how a chartist approach that relies on macro statistical and technical analysis can work on a small cap share - it might be useful in a broad sense in conjunction with specific knowledge to gauge the best timing on investing in a share thats moving from exploration to production, but without the statistical averaging of a larger index or sector smoothing out the anomalies and emotional trades in a single share technical analysis can't be accurate. Lots going on here with options and Drachs and Mellon etc. Good luck to anyone trading this share!!!!

Drachs doesn’t have a history of taking companies private - wouldn’t Candy be able to stop this - he has 24%

Look at the volume- has to be to do with Bowdens options. Some transparency on this would be good - this is one of the reasons institutional investors steer clear of small caps with insider ownership - positive to see management with skin in the game but it would be better to issue an RNS to explain

France is over 100% for a decade not as bad as Japan!