Member Info for mrtibbles

Centamin provided an update in their Interim Results saying the LHDR was up and running.

The underground delivered a total of 601kt of ore; 340kt from stope mining and 261kt from development. The ratio of stoping-to-development ore for the period was 55:45. Production equipment availability and utilisation issues experienced at the end of Q1, and early Q2, predominantly due to recurring damage to the long hole drill rig ("LHDR"), reducing stoping volumes and leading to an increased mix of lower grade ore-drive development tonnes. There have since been no further disruptions to the LHDR and stope tonnage improved in line with the revised mine plan. As a mitigating measure, an additional LHDR is due to arrive on site in the fourth quarter.

http://otp.investis.com/clients/uk/centamin_plc/rns/regulatory-story.aspx?cid=1756&newsid=1131940

Listening to the World Service last night and they were interviewing some Trump supporters from the farming community who thought that Trump was doing a great job?
Wonder if they realise that a nuclear war wouldn't be b good for farming or exporting to Canada?

What peak?
They were half price.
Don't wish to be rude but you really need to do some research on Centamin past history and you will see that you will do very well out of these shares in the future.

https://www.bullionvault.com/gold-price-chart.do
Gold Price 'Set to Squeeze Bears' Again After Net Short Slashed 63%
Monday, 10/22/2018 15:03
GOLD PRICES slipped Monday morning, dropping $12 per ounce below last week's 2.5-month high as China's stock market rallied at its fastest since 2015 on a raft of 'support' promised by Beijing, writes Atsuko Whitehouse at BullionVault.

Europe and other Asian equity markets rose less steeply, while gold prices traded down to $1221.50 per ounce.

International tensions meantime worsened over Saudi Arabia's apparent murder of a US-based journalist, plus the UK Government's attempt to conclude a Brexit deal with the European Union, as well as Italy's planned 2019 budget deficit.

"Supportive price action around $1210-1220 should restrict declines amid current global political uncertainty," reckons the gold trading desk at Swiss refiners and finance group MKS Pamp.

"A test through $1230-1235 will likely squeeze further shorts out of the market and see gold toward $1250."

Starting from their heaviest net-negative betting against gold prices on record, hedge funds and other 'Managed Money' traders last week more than halved their bearish position on Comex gold futures and options, according to US regulator the CFTC.

Net of that group's bullish bets, the overall short position fell 63% to the notional equivalent of 116 tonnes, remaining net negative for the 14th week running, still the longest period since this data series started in June 2006.

Hi Carly,

From speaking with my old broker friend who has very good contacts regarding Centamin & Egypt, he is of the opinion that lessons have certainly been learnt and although painful now it has brought about the purchase of new plant (LHDR) which will be far more reliable, more efficient,safer and able to operate for longer periods, even in adverse conditions.
He thought that this LHDR purchase can only be good for production, especially as it will be run by Capital Drilling who he described as one of the very best in this type of industry,
My broker friend said that Centamin have been punished far too severely by the markets and are still far too cheap as will be seen in the future when many will wish they filled their boots at this price!
I asked about production at present, but he said not to worry too much about the present, but to concentrate on what will be the situation in a few months time when once again Sukari will be spitting out cash like a demented cash machine!

I asked his opinion about gold price , the Fed & Trumps tweets as I know he has many clients invested in related products

Trump tweeted interest rates were rising too fast ?
Jay Powell has said they may have to rise even faster?

His answer- As much as this will influence the paper markets, the physical market is very strong and will underpin undeliverable stressed out oversold paper gold.
The true effects from EM meltdown is not factored into the Fed’s ‘uncertain’ trajectory..
Watch them backtrack.

I have known this broker and been a friend for over thirty years and during that time I have never had cause not to trust him.

What is wonderful is that very few people seem to understand what this 50/50 deal is – it is effectively a 50% tax on free cash flow. In fact the 50% will not kick in until 2016, as in 2015 this will be 45%.
To counter this there is no VAT, no corporation tax, no other taxes to pay all beyond the above and the royalty, which on a blended rate compares reasonably well with other 1st world mining jurisdictions (like the US, Australia, Northern Europe etc).

INVESTORS CHRONICLE

Cashed-up Centamin awaits Sukari judgment

Like most gold miners, shares in Centamin (CEY) are well up this year, but financial results for 2015 were a mixed bag. A drop in all-in sustaining costs from $912 to $885 per ounce were considerably below guidance, but exploration write-offs and a tax charge on foreign exchange gains hit the bottom line. An average realised gold price of just $1,159, down 8 per cent on 2014, didn't help either.

There were bright spots, though. The balance sheet now looks far more robust, with cash, bullion and held-for-sale assets more than trebling to $231m, while a fourth-quarter fall in cash operating costs to just $667 an ounce bodes well for an uptick in this year's free cash flow (and by extension the dividend).

The legal battle over the Sukari mine in Egypt could also soon be resolved. A judgment on Centamin's appeal to nullify the mine's concession agreement has now been set for 24 May, although a favourable ruling for the miner may be passed on an interim basis pending a legal review by the country's highest court.

Analysts at Canaccord Genuity are forecasting full-year cash profits of $254m, giving adjusted EPS of 13¢, against $156m and 6¢ for 2015.

http://www.investorschronicle.co.uk/2016/03/21/shares/news-and-analysis/cashed-up-centamin-awaits-sukari-judgment-wp2EldajbMyJy3XUu7RuKN/article.html

Centamin have not only consistently paid a 3% royalty it is now delivering significant payments for the free cash flow share with the government. It is fulfilling what it is legally obliged to pay, and this is going down very well with the Egyptian government. The political war was won when Centamin decided to go ahead with the expansion of Sukari to 10mtpa with the blessing of the government, and the latter are now reaping the rewards for the longer game.

sorry Q&A were with Man on the Train!

Some Q&A re profit share
RE: How Fair Is Egypt's Profit Share?
Today 19:02
Is the CEY P/E before or after profit sharing?
Post sharing – it is worked out on EPS

if before then in reality the pe is higher for it does seem absurdly low?
It is low as the market has yet to catch up that capex will be coming right down in 2017/2018/2019

Am I correct assuming CEY pay the government 40% free cash flow rising to half?
Yes – 1st 2 years of full cash flow share is 40%, the next 2 years is 45%, and thereafter 50%

Would that then double the P/E, or is free cash flow and earnings quite different, because of the way capital expenditure is depreciated, though eventually the same, or as asked does profit share come out before the p/e is calculated?
EPS is after all the depreciation etc. The cash flow to the government comes out of the free cash generated – so all capex already done, costs paid (salaries etc), etc.

Hope this helps,!

https://www.arabfinance.com/2015/pages/news/newsdetails.aspx?Id=416470&lang=ar

http://www.alarab-news.com/ebusines/article-1421687.html

Some figures from Mr-Yousef El-Raghy in case some of you find it useful:

-$12.2m advance profit share paid to EMRA in October 2017.
-$136m total advance profit share have been paid to EMRA since October 2016

http://gate.ahram.org.eg/Media/News/2017/2/26/2017-636237441861789391-178.pdf

Hi uncertain, I will give you the ultimate answer. You will find in the link above a pdf file of law 222 year 1994 (The concession agreement) .
In page 51:
After the deduction of royalty payments and the recovery of costs and expenditure as provided in paragraphs b,c,d and e, any remainder of sales revenue shall constitute net proceeds and shall be shared between EMRA and Centamin.

(You will find all the details in the pdf file. One page in Arabic, then one page in English).

Fair comments Rebess, despite what Trump says abut the world taking advantage of America quite the opposite is actually the case, the US can do what it does because the dollar is the reserve currency and they care not a jot about the national debt!
This is why the US was so keen to take sterling down (once the reserve currency)

https://www.dailymail.co.uk/news/article-2039453/How-America-planned-destroy-BRITAIN-1930-bombing-raids-chemical-weapons.html

https://nationalinterest.org/feature/revealed-americas-secret-war-plan-invade-canada-15359

However it sold us unseaworthy ships in WW2 and Tommy Cooker tanks and lot's of other crap at inflated prices which bankrupted us instead so the US got its way

Posted by Drewsky on here
One of those conspiracy theories but entirely feasible?

http://thefreethoughtproject.com/6-years-ago-us-killed-gaddafi-gold/

Also the US sold our banks all that repackaged prime mortgage debt that helped bring about the financial crash of 2008

Now everyone in Europe is paying more for their oil because Trump doesn't like Iran but in the meantime he supports Israel treating the Palestinians appallingly and supports a a bullying dictatorship in Saudi Arabia

From the man on the train 13.03.2018.

Obviously since then some problems have occurred, but these are being overcome and the overall strategy remains in place to deliver record results in the future!

The divi will always be a minimum of 30% of free cash flow generated, which is post profit share. This is the case even if they decide to build/buy another mine.

The other key is CEY having a cash buffer on the balance sheet of between $250-300m. That is to be deployed for the building of the next project, cash for a rainy day, etc.

Anything above that level will be given back to shareholders.

The reason the divi was 100%+ of cash flow is that the cash generated was strong and they did not have a project to earmark for development, so they handed it back to shareholders.

In terms of the forecasts for profits, well no-one knows what they are going to be because of a fluctuating gold price, currencies, fuel costs and other variables.

What CEY believe is that they are going to produce 580,000oz in 2018 at one of the lowest cash costs in the industry, they will share the free cash flow with the Egyptian state in the way that has been very well explained, and whatever surplus they have (over $250/300m on the balance sheet) will be handed back to shareholders.

People have to remember that this company last raised funds in 2010/2011 and has never come back to shareholders for a cent more. Nor do they foresee a time when they may need to.

The profit level is somewhat irrelevant really, it’s the cash flow which is the real value of this business.

So perhaps, Egypt's profit share is neither the bogeyman nor the death knell of gold mining investment when compared to the so called 'safe & modern' mining jurisdiction of Australia. Legalities aside, Egypt also has the benefit of an economical labour force, a desert full of untapped resources and the absence of rigorous environmental liabilities.
http://www.miningweekly.com/article/australian-miners-paid-more-than-half-of-201415-profits-in-tax-2016-12-09

21/11/2017

https://www.arabfinance.com/2015/pages/news/newsdetails.aspx?Id=416470&lang=ar

http://www.alarab-news.com/ebusines/article-1421687.html

Some figures from Mr-Yousef El-Raghy

-$12.2m advance profit share paid to EMRA in October 2017.
-$136m total advance profit share have been paid to EMRA since October 2016

PDF file of the full concession agreement (law 222 year 1994):

http://gate.ahram.org.eg/Media/News/2017/2/26/2017-636237441861789391-178.pdf

Above AISC costs then we are in free cash flow which we share.
The the rise (or fall) of oil is done on a quarterly basis.

AISCs, these will rise and fall in relation to the ounces produced (more produced/lower costs, less produced/higher costs).

From the man on the Train 10/2017
Clearly if Cleopatra does come in, though there will be reasonable cost involved in the development work (moving all of the rock for crosscuts, drives, ventilation, emergency access, stoping panels, etc) the head grade would have to be at a level which is justifies this expense and yes, the AISCs would certainly come down.

But in the short term the increase in production will come from using the Amun/Ptah decline more efficiently and raising production from 1mtpa of ore to 1.2m or 1.3mtpa, improving the throughput of the plant from c.11.5mtpa, and better grades out of the open pit.

All of these factors, excluding anything from Cleopatra, would drop AISCs further.

https://www.youtube.com/watch?v=-o7OxgMeht0&feature=youtu.be

https://www.youtube.com/watch?v=2TR-XsK43tA&feature=youtu.be
Most are unaware of, or have ignored, that which has been staring fiscal policy-makers in the face - paper currencies have no real value!
Whatever our level of awareness, 99% of the world is sure to have felt the repercussions of broken economies the world over.
We take a short look at the main events behind the global financial collapse (which is still ongoing) and more importantly, propose an accessible solution for the benefit of all.

Trumps chickens my be coming home to roost!

https://secure.avaaz.org/campaign/en/end_trump_wrath_93/?krtqjhb

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A global democracy means holding leaders to account for their actions anywhere