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Thanks for your replies,
Basically what I was getting at was that are future profits for Copper aren't circa $9.5k less $4.5k they are in fact:
$9.5k less processing costs less refining costs, and we don't know what those costs are. The $4.5k quoted includes the cost of buying the processed copper....but this is now effectively JLP paying JLP!
Maybe someone could help me out with this.
Before yesterday's news we were told that the JV would process the copper and then sell it to our Sable refinery. Numbers weren't obvious at first but then the $4k cost was mentioned...which I assumed was the cost to Sable which included buying the copper from the processing JV and then the refinery costs (maybe this is why it is fluid as it is proportional to the current copper price). The profit circa $9k less $4k was 100% due to JLP.
On top of this we received a % of the processing profit....the numbers for this we weren't given.
So, now we own 100% tailings (I'm keeping this simple with Roan for now) our Sable profits won't change but our processing profits will now be 100%.
Does this make sense or have I read this completely wrong.
Rounded numbers from the 1st 6 months results:
Gross Profit 31m
Operating costs inc depn -7m
Tax -5m
Net profit after tax 19m
We know the GP from 2nd 6m is 40m, so assuming operating costs inc depn of £8m and Tax of 7m then we come to an overall profit after tax of £44m (I was a little conservative below)
Isn't a true PE ratio based on profits after tax? If so I reckon this will be around £40m for the 2020/21 financial year, thus making the PE ratio already 10.
Although I don't dispute that a forward looking PE ratio of 10 would see our share price considerably higher than it currently is.
Like others have said, once our copper profits start to become reality then a re-rate must surely be on the cards.
I thought the capacity at Mopani, after various Jubilee upgrades to the refinery was 17,000. This coupled with 14,000 current capacity at Sable makes the circa 30,000 quoted...although neither or these are available straight away. The graph under Copper Growth Profile suggests we will hit these production levels in Q3 2023.
Obviously this doesn't include the potential to upgrade Sable, or indeed the Mopani refinery, if the latter is possible.
That makes perfect sense but then how does that tie in with one of the main reasons of an IPO in the first place….to raise capital for the business to expand. This is the ‘catch 22’ that I keep coming back to….maybe I need a crash course on IPOs
I've been mulling this over in my head. I think there has to be a difference between the pre and post float valuation. i.e. if a coy is valued at £100m before an IPO then surely their after the float they would be valued at £100m+monies raised.
Using an example with a £100m coy, if the owners wanted to retain a 25% stake then lets say the IPO was for 75m shares and therefore they retained 25m. The IPO price would be £4. The new valuation would be £4 x 100m shares = £400m which would equate to the original valuation of £100m + monies raised of 75m x £4 (£300m) = £400m
I could be totally wrong here though
These are the copper production numbers and earnings I have for the various y/e. I cant remember what info I based this on but there must be quite a few assumptions built in. Copper price is assumed to be $9,000, but I have assumed nothing for Cobalt as I just don't know enough
2021/2 8012 = £36m
2022/3 18,786 = £75m
2023/4 23,796 = £96m
Le me be clear, I have invested in this company for many years now (since the Braemore days) and continue to hold because I believe that the company is on an exponential growth path which has the potential to take the share price to £1+.
I have never complained about previous placings as I'm fully aware that this is the only means available to raise the kind of funds necessary to propel a fledging company forward.
Whilst I accept CB's assertion that no future placings are needed and I do not believe he is lying when he is saying this, I also appreciate that these assertions have been made in the past only for placings to happen months later. This rhetoric isn't limited to placings either.
So, as I mentioned previously I will take the writings of an RNS as gospel but utterings during an interview with a pinch of salt
I would argue that rather than being arrogant to place caution on what CB says in an interview, it is perhaps naivety to rely such claims.
I will only go by what is stated in an RNS with Jubilee and take everything else with a 'pinch of salt.'
Agricore, you need to adjust your numbers for the actual smelter price paid - a safe assumption is 80% on quoted price. Also I think your various prices are quite high. It depends where you look but I've always relied on the Kitco pricing which is currently showing:
Platinum 986
Palladium 2548
Rhodium 18,200