The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
Who on earth is ramping? Close reading of the company's RNSs tell you what's going on behind the scenes. They're negotiating with multiple partners under NDA to agree a sale of their Russian assets.
the fact that any haircut is based on value of assets, not offer price, could work in our favour. just one nkt pit has an npv of $1.7bn, so add the second, then loipi, nittis, trav extension, something for the nyud entitlement, then wk. then consider that the dfs upgraded (by how much we don't know) the resources, meaning we could be talking as much as $5bn on an independent valuation.
but let's say $3bn or £2.4bn: halve it for the 50% haircut (£1.2bn), 15% exit tax (£1.02bn), times by 80% to get eua ownership (£816m), another 20% for fees and taxes (£652m) and then 80% as a special divi = £522m with another £130m retained in the company.
so, on this back of a *** packet calculation, that's a divi of something like 18p/share. however, any of those figures could be revised upwards: we might not pay the 50% exit tax (or all of it), the valuation might be considerably higher than $3bn, the board might not want to retain as much money going forward for eua2.
plus, my hope is that artem was brought in for precisely this reason: to persuade the russian state that eurasia should not have to pay the full exit cost, on the basis that they were already selling before the war, they've been a friendly company that has worked hard to bring these assets to production when nobody else wanted them (for 25 years) and by far the best way of encouraging junior exploration in the country once the war is done is to let a small explorer get their bonanza.
so, a possible ten bagger from this point, with significant potential upside? i've got some dry powder coming in this week and will still be buying.
"And how could he have sold at the peak?"
He couldn't, and that's the point: it's not a lifestyle company.
A lifestyle company where the chief M&A officer, who is also the largest shareholder, is effectively working for free and didn't take the opportunity to cash out at the all-time high? Very odd lifestyle company if so.
Anyway, I made a nice little trade on HE1 today, and now have 1.25m Eurasia shares. Still very confident of a happy ending. Rums all round!
Booked reserves are 4400kg but they already anticipate that increasing to 6400kg on existing data. Plus, they’re obviously not going to get to 64k/oz immediately. It’s a target. You seems to have missed off the bit where they expect the entire district to have 21.6 tonnes eventually: that’s almost 800,000oz, which is where the long-term 64k/oz target comes from.
Worth noting that P’s figures don’t account for rising PGM prices (some projections predict significant increases by 2030 as deficits tighten) or the mix of particular metals extracted. We know WK has a lot of rhodium (and some iridium) so £20m/yr could, in fact, be very conservative (and is why, in my view, WK’s contribution to any special dividend if sold won’t be negligible).
FWIW though, my assumption is that restarting production is not about Eurasia mining themselves, but rather getting things moving again so the buyer can hit the ground running when the thaw comes. Or signalling to any buyer wavering on MT that they can mine and it’s time to PUSU if they want to avoid the risk of them triggering Sino.
What has 2022 production got to do with future production targets?
If the company can sell the concentrate, the simple fact that WK is producing again should itself see the SP increase significantly from this low point. A fully producing WK should theoretically imply an annual dividend of somewhere in the 0.5-0.7p range or £200m over the next decade (multiples of current SP and that’s just for WK).
I'd say the fact the SP is holding up at 0.5 (almost 50% up on the week) is a good sign. Only needs one document to be signed and it's lift-off here.
Someone knows something. That isn’t punt money.
I wish I could have trebled, but I've gone from 600Kish to over a million and set my kid up for life in their Jr SIPP and ISA.
Rums all round. Nice to see a bit of movement bringing some old stalwarts out to marvel at the headbangers!
10. LTHs who have kept the faith have suffered big paper losses (I know I have) but have, in some cases, managed to hugely increase their holdings in anticipation of the endgame.
"Been away awhile. Can you explain the tax case. Cheers"
Short version: Kovinsky Kamen (the company EUA jointly owns West Kytlim with) went into dispute with local tax agency that tried to apply a tax rate of c.20% on its concentrates from WK because gold was in the mix. KK contested this as it should be closer to 6%. This has been escalated up through the courts, and a final ruling should be given today. All indications are (including various comments from Ministers and other senior folk) that the state recognises the legitimacy of the company's claim and will rule in its favour. Some think that this could be the final legal due diligence hurdle that begins to unlock asset sales (and I would count myself in that group).
A winding up petition over a £108K legal bill that the company is disputing. They won't be wound up today though: they can't be, because they're solvent. No advert in the London gazette either so quite likely a negotiated settlement has been reached. If not, either the judge throws the case out and tells Gowling (the claimant) to pursue the fee by other means or orders Eurasia to pay up. That's my understanding, anyway.
Oh, and stop paying attention to Fran, Kira, Toffers, whatever her name is. The fact she is on here ranting constantly and has been for the past five years, while constantly changing her name, should tell you everything. Put her in the green bin.
Innit ... Nice to get some movement at last. Long way to go. But the end is hopefully in sight now.
It's a leak, obviously. Rums all round!
"However my faith in the board is virtually non existent now"
If you have no faith, why are you invested? Surely you'd be better of investing your sizeable holding in something that you do have faith in. Or is it that you're not actually invested?
I see we've got some new derampers turn up here. Always a good sign. Brand news monikers who seem to know lots about EUA and all of it negative. They must know that we're likely close to news. Options expiry coming up. About 16 weeks from the DFS approval, which is bang in the sweet spot for how long Russian state committee approvals seem to be taking. Only a few working weeks to the end of the year by when Christian said at the AGM he was hopeful of sale news.
Still, appreciate your efforts at helping to keep the share price suppressed. I've nearly doubled my holding this year.
Rums all round!
I’ve almost doubled my holding over the past few months at these prices. Absolute gift-horse.