Member Info for mrtibbles

RE: Berenberg raise target price to 173p23 Oct 2023 06:47

More detail this morning from Berenberg on Citywire:

Https://citywire.com/investment-trust-insider/news/expert-view-aviva-moneysupermarket-gb-group-firstgroup-capital-ltd/a2428592?re=114049&refea=218441

"Don’t ignore Capital’s investment portfolio, advises Berenberg

With the gold price at $2,000 now, PDI shares rose 6% overnight to A$0.245, which is its highest for almost 2 years and getting towards its highest ever level from around that time.

At current exchange rates that's worth £18m against the £148m m/cap:

Https://www.asx.com.au/markets/company/pdi

Allied Gold's shares have also bounced 14% to C$4.80, so this holding is worth another $10m or £6m.

Pity Centamin share holders don't get some uplifting news instead more of the same old boring spin which if it were a meal would be described as "Bland!" at best!

Wish we were only down as much, from the highs Cey is down well over 65%, the free cash flow is now a trickle and the dividend is table scraps!

Possibly Endeavour will make a bid again!

Hi Mizolgit,

It is depressing, Centamin is in the spittoon of the "Last Chance Saloon!" and is likely to remain there for some time, in fact it may end up down the lavatory pan the ways things seem to be going!

Hi Cowichan,

Difficult to offer an opinion without knowing all the full facts and how often do ordinary people of mining company retail shareholders get told the full facts or even the full truth!

$375 million may sound a lot, likely worth twice that, but that aside if $375 million is only 5% of the county's economy then it all depends on what are the down sides of this contract?

Far too many multi national companies exploit the countries they operate in often because they pay back handers to corrupt politicians and officials who like far too many company directors don't really care a jot about anything other than filling their own saddle bags with cash and expenses !

How many times the retail shareholders get sold a bum steer by mining companies, have a look at some of the cases in Crux investor, not to mention a company that we are all familiar with!

Have to agree Bobliz35, the best way to convince people and give them confidence in whatever you are trying to sell them is is to buy in yourself!

See my communication below-

Questions for Investor Meet Presentation -Why aren’t the BOD buying shares?

Dear CEO Martin Horgan,

There seems to be some reason why with the POG at around $2000 the free cash flow seems to remain poor and despite polished company presentations the market remains to value the company as though all isn’t as well as being claimed!

So It seems very clear now that however polished and in many respects stage managed the company presentation’s, it’s not enough because the market, existing shareholders and potential new investors seem to retain serious reservations about the true state of the company, it is regraded by many now as a short term trading stock, not an investment!

I appreciate that that a directors bonus scheme is in operation, but in reality the hurdles are pretty low and rewards aren’t linked to the share price, so basically its directors being awarded shares for doing their job, not really that convincing to those who have bought shares that are now at 35% of what they once were!

The measure of a director’s effeteness and worth is directly related to the company share price, so what better way for you and your fellow BOD to demonstrate your confidence and belief in your forward strategy for company to the market and other existing and potential shareholders than to step up to the plate by making some substantial share purchases, say at least 30% of a year’s salary, because if is all as well as your company presentations would like everyone else to believe then you and your fellow BOD members would be able to benefit just like other ordinary shareholders from the rise in share price, an additional but justifiable directors bonus it might be said!

However if none of the Centamin BOD are willing to put some of their own “Skin”, that is money out their own pocket, rather than just hanging onto free bonus shares until they are allowed to sell them, then it’s time to be honest and seriously consider resigning and let the company be taken over by others!

Yours Sincerely

Contact details supplied

UK Shareholder

Hi Sotolo,

Have to agree with your partner, in fact they are so bored they can't be asked to buy any shares out of their own pocket, although the CFO is now in favour of buying back shares with the company's / shareholders cash, although with his caveat!

Agree with you Cowichan, including who has the biggest ego, although to be fair they both make big claims but seem to have difficulty delivering, but both are very adept in moving the goal posts or kicking the can a bit further down the road!

What a pity we have to just listen and cant ask telephone questions!

There are many factors to consider here for the company, it' shareholders and indeed the Egyptian Government including-

1. The grid can't cope at peek time now and any addition and significant demand for industrial use depending on the time may well exacerbate the power down times!

2.The CAPEX justification for linking to the Egyptian main grid is dependent upon the cost advantages including cost break even time and future cost efficiencies all of which are dependent on the reliability of electricity which at present is erratic and likely to get worse?

3. Possibly more importunately Centamin has always been keen to be seen as a "Good Guy" in its host country by regarding its moral and environmental responsibilities as priorities by considering the wellbeing of its workforce and the wider Egyptian community.

What then if electricity were to be denied to those people of the wider community in preference to supplying Centamin then that would surely be going against the ethos and core principle that Centamin has been so keen to promote over the years?

There are a lot of $ being spent and then 'capitalized' via the Capital waste clearing as non-sustaining the EMRA does have the opportunity to allow or deny a portion, thus Centamin not being able to recoup it, resulting in a payback schedule to the EMRA.

IF such a discussion is ongoing for a significant amount (i.e. if the EMRA demanded Centamin only be able to capitalize a stripping amount equal to the original LOM plan of 5.3 to 1 then Martin Horgan would surely be required to make a clear announcement to shareholders of any cost-recovery disallowance?

For obvious reasons these are typically the type of things that tend to get buried into the fine print of company annual reports such as on page 152 labelled key audit matter here: https://www.centamin.com/media/2940/centamin-ar22.pdf

Further details regarding stripping costs being allocated as capital can be located on page 182 - where it also notes that the rise in such allocations was deemed significant (which likely would raise a red flag at the EMRA) 2021 being $59M and 2022 being $141

There is mention in the report of he 15 year tax holiday coming to and end in 2025 , but also stated that PGM will submit a 15 year extension as well.

Explanation is required on how a 50/50 profit split agreement could also be expected to pay income taxes and why such a holiday and extension would be needed ?

Hi Keepplugging,

It's quite true looking at the full history of Centamin there there were some outstanding results , unfortunately they were unsustainable and the esults from 2018 have been erratic, unreliable and rated from disappointing to dire up until now!

True the previous management were very successful at cutting corners, glossing over the true facts misleading the shareholders and filling their own boots just before bailing out as the cracks appeared in the gloss and the pit wall, but that said they had exclusive knowledge of the true state of Sukari which obviously retail share holders did not!

Lets face it if the previous management had done things properly then they wouldn't have needed to bail out and the Centamin share price wouldn't be languishing at around 80p with POG @ $2000!

Hi Keeplugging

It's understandable on the information and media releases made available by the previous management and indeed the brokers analysis predicting a share price at nearer £3 why people bought in at £2, but unfortunately Andrew Padey, the BOD and indeed members of the EL Raghy family were glossing over how they were achieved by high grading and failing to have in place a fit for purpose methods or any method at all of adequately dealing with waste ore, also the open pit walls angle of inclination were too steep and there was inadequate surface water drainage at the top of the open pit, this all contributed to the inevitable and narrowly avoided near catastrophic pit wall collapse when the crack in the open pit wall became so apparent that it forced the previous management to confess their years of bad mining practice!

You may be aware that in the original Sukari agreement profit share didn't begin until all CAPEX costs in the building of Sukari had been recovered which would have been all well and good if the original open pit and the underground operations had been developed to the correct speciations for long term operations, but this wasn't the case.

So do we now have a situation where the new management through the deception and poor mining practice of their predecessors are having in many respects to redevelop Sukari from scratch which incurs a huge increase in CAPEX , this I suspect is very difficult, if at all possible to recoup from EMRA who were likely of the impression all major CAPEX had been repaid!

In view of this could the management now trying to renegotiate some extension of terms in the LOM plan

(That is he 15 year tax holiday coming to and end in 2025 but it also says that PGM will submit a 15 year extension as well. )

You may recall Hendersom's postings recently warning of some unannounced bur impending bad news, I wonder ?

The Suakari potential problems were exposed in 2015 & 2018, it is now apparent they were justified!

https://rb.gy/5qo6z

Sorry Mr gnome, I mistakenly referred to you as Mr Bond!

That's excellent Mt Bond who knows if we are lucky our share price may tick up to at least 83p for a couple of days!

I concur, an absolute stinker of an investment and a result of the management never being completely honest with the shareholders or the market!

Hi Sotolo,

I agree with you entirely on this, the "Fishy" smell is increasingly apparent the higher the sterling POG as is my rising suspicion that the management aren't being entirely honest regarding some rumoured changes in the agreement with the Eygptian government which reduced the amount of free cash flow!

More detail this morning from Berenberg on Citywire:

Https://citywire.com/investment-trust-insider/news/expert-view-aviva-moneysupermarket-gb-group-firstgroup-capital-ltd/a2428592?re=114049&refea=218441

"Don’t ignore Capital’s investment portfolio, advises Berenberg

Projects at Capital Ltd (CAPD), previously known as Capital Drilling, are on track but the market is giving no credit to its investment portfolio, says Berenberg.

Analyst Richard Hatch retained his ‘buy’ recommendation and increased the target price from 169p to 173p on the Citywire Elite Companies AA-rated mining services company, which closed unchanged at 77p last week but are down 20% this year.

A third-quarter update showed revenue slightly below Berenberg estimates, but it observed that ‘key mining and drilling projects are on track’ and the group ‘also provided an investment portfolio update, noting an increase in value by $5.7m to $47.8m’.

‘Capital’s holding of Allied Gold, which listed during the third quarter, with a market capitalisation of CAD1.3bn, was worth $10m as of 30 September,’ said Hatch.

‘Overall we view this as a steady update from Capital, but we highlight the positive investment portfolio update which is 25% of its market cap and given no credit in its valuation, in our view.’"

27 Oct 2023

In this week’s episode of Live from the Vault, Andrew Maguire is joined by Dave Kranzler, founder of Investment Research Dynamics and Mining Stock Journal writer, to discuss outstanding US Treasury Debt and its impact on precious metals.

The experts debate how the coming banking and financial crises will be far more devastating than 2008 and how this will impact the price of gold and silver before Dave reveals some of the stocks he’s looking at shorting in the near future.

https://www.youtube.com/watch?v=np1gzQbsqj8

https://investmentresearchdynamics.com/

I suspect that shareholders may not have been made fully aware of some changes which is why I am submodifying the following questions to the Investor Meet preservation for some clarification.

1.Whether he profit share with the Egyptian government been amended or changed at all over the past few years - with dividends being distributed to shareholders yet free cash flow remaining stubbornly low,has this relationship been tested at all?

2. What cash has been paid to Egypt through the profit share and royalty mechanism in the last 2 years and what is it anticipated to be for the current year?

Hi Tornado,

Possibly in some respects the CEO has no control over what the market decides to value stock at, but he has great power to influence the markets decision over the valuation of the company share price .

SteveJones often refers to the main factors that influence the market and the CEO and BOD making some substantial personal share purchases is a fact that legally requiring an RNS in this case a confirmation that the CEO and BOD have great faith in their future strategy of the company which would certainly influence the market valuation of the company ,likely to the better!