Member Info for Nickderby

YTSS, I don’t know why we bother about the short term share price. Production is increasing, the FeV price is increasing due to the structural deficit. This deficit will be around for a minimum 3-4 years. The new Chinese rebar standards will increase the deficit further. We are already making excellent profits. Cash flows are very good. Dividends are being discussed in H2. Then we have potential growth prospects with production growth through Vametco, Brits and Mokopane. Brownfield acquisition, electrolyte production, VRFBS, Eskom, BE, Lemur, Afritin and Sojitz acquisition. No concerns from me. All that we need is patience..... :)

Here’s another good explanation from BBN. ‘Whilst the RNS regarding the equity placement does not specifically state we are going to buy out Sojitz, in my view the wording can only really lead to that one conclusion. Vametco is the only effective source of cash flow that BMN has. There the cash raised is to simplify a corporate layer directly attributable to Vametco. There is no other organizational or corporate structure involved in that business whose removal would ; a. Enable access to the underlying cash flows and ; b. Would cost £6.4m to remove. It may be taking longer than planned but BMN have raised cash to help take out Sojitz, whether they say it directly or not. This is further backed up by John Meyer in an interview just a few days after the placement. Remember his team led the cash raise. Sojitz is the easiest and most direct route that BMN have to increased Vanadium production. Faster than brownfield and certainly a lot quicker than Mokopone.’ Bring it on!

I think this BBN post from 16th July says it all. ‘Note that FM clearly states in the interview that the simplification of the organizational structure is specifically designed to allow greater access to the “Vametco cash flows” So it’s 100% Sojitz and it’s on it’s way. PS FM is talking like a man who sees a share price in the pounds not the pennies, and from what he has clearly detailed, it will happen once all the pieces are firmly in place.’ It’s going to happen, more patience required :)

Sorry, typo.

22.625p to buy
22.62p to sell

22.625p to buy
22.26p to sell

It’s also important to look at forward PE ratios (not historic). From the ARC broker note. ‘We have lifted our 2018 price assumption from US$50/kg to US$68/kg (simply bringing it in line with the year-to-date average), the increase more than offsetting the negative impact of lower near term production expectations to raise our 2018 consolidated EBITDA estimate by 40%, to £91m (£54m attributable). We see considerable upside to both our earnings estimates and valuation should current elevated vanadium pricing levels hold.' So with conservative FeV price assumptions of $68 per tonne for the remainder of 2018, ARC calculate £54m Ebitda for 2018. Let's say £50m pre tax profits. Therefore post tax, say £39m. That puts us on a forward PE of just 6.5. PE 15 - Market cap £585m, 53p per share. PE 25 - Market cap £975m, 88p per share. Not bad based on low production of 3,000 tonnes pa, low FeV prices of $68 per tonne and only including Vametco at 59.1% ownership. Everything else ignored. There's significant upside on all of those figures :)

South Africa’s all share index currently has an average PE of 14.51 and the top 120 AIM companies have average PE ratios of 25. It’s very easy to see why BMN will trade at a level significantly higher than this. PE ratios are based on growth. The higher the growth the higher the PE ratio. I don’t need to tell anyone that the growth prospects here are incredible. As we are a growth company, we should attract a much higher PE ratio than the average. Just consider our potential growth prospects with production growth through Vametco, Brits and Mokopane. Plus brownfield acquisition, plus electrolyte production, plus VRFBS, plus Eskom, BE, Lemur, Afritin and Sojitz acquisition. Also, the huge structural vanadium supply deficit. This will be even greater in November when the new Rebar regs kick in. Imo, the market will assign a PE ratio significantly higher than 15 (over the next 12 months) as Institutions start to buy into the Bushveld story, VRFBs and the large structural supply deficit. We won’t need to wait for years of profits, it will happen very quickly. Remember Vametco has been trading for years already. DYOR

The buys are still coming!! :)

We're certainly on the move.
Max buy at 23.5p with II is again just 30,000 shares.

Max buy on II is just 30,000 shares at 22.9p.

Two Henrys hoovering in unison this morning.

I may be in for a few more later :)

£1 coins for 22.375p.

That's another 200,000 for me!
Thanks :)

Nihilfit, as I say, easily achievable targets. With shutdowns for upgrades, industrial action etc in H1, we hit 1360/1500 which is over 90% of capacity. To reach the new high guidance of 3,000 tonnes we would need to hit 1640/1875 which is just 87.5% of capacity. I am expecting the Company to beat those targets. Always better to set lower targets and overachieve :)

Nihilfit, you do realise that the lower production in H1 was partially caused by plant upgrades to increase production levels? Phase 2 upgrades carried out in H1 have increased capacity from 3,000 tonnes pa to 3,750 tonnes pa. H2 capacity is therefore 1,875 tonnes giving a max of 3,235 for the year. The target of between 2,850 and 3,000 tonnes has been set at an easily achievable level.

@Jonesy. It is quite normal practice to include 100% of the subsidiary’s figures. As Vametco is a subsidiary, 100% of Vametco’s turnover, costs and profits will be appear in the group accounts. Then at the bottom of the Profit & Loss account the part that doesn’t belong to BMN will be removed as ‘minority interest’. There is nothing underhand about this treatment. It’s normal accounting practice. If you check out any BMN broker notes they will show 100% of the Vametco profits and then mention the attributable profits. In fact I mentioned ARC earlier. ‘We raise our 2018 consolidated EBITDA estimate by 40%, to £91m (£54m attributable). ‘ Not bad for our first year of profitability. Especially when you consider production and FeV prices are increasing nicely.

Excluding everything that is happening on the ground, we have two other very exciting developments coming in H2. Firstly the dividend policy is going to be announced. Exciting! Secondly, we are going to have news explaining Bushveld Energy’s business model, cash flow capabilities and valuation details. That should be very interesting. Not to mention the JSE listing. Oh I just did :)

I would say sentiment is very positive here.
The vast majority of people must be very content with Company progress to date.

There's so much going on in with the vanadium platform and with Bushveld Energy.
Plus Imaloto BFS on its way and Afitin production in Q4!

What is there to be down about?

A few warrant holders selling down their entitlements has hurt the share price, but we've been here before.

When the selling stops, the share price will go to the next level :)

Pb940, well let's see...

3,979 posts in 1,687 days, that is around 2.36 posts per day.
So 21 more posts should be around 9 days time, that is September 8th.

Strangely enough that is the anniversary of the day I first met my wife.
Maybe we will be doing something to celebrate both milestones.

Well you did ask! :)

WhileyD, because there is a 4 to 6 week time lag in benefiting from increased prices, BBN is saying Q3 is effectively over by the end of August.

September FeV prices will therefore affect Q4 and not Q3 (if that makes sense).

Also from the ARC broker note.

'We have updated our model to incorporate Bushveld's revised operational guidance, but also for an increase in
our vanadium pricing assumptions and favourable currency rate movements. Vanadium has surged upwards again over the past two months, FeV reaching a ten-year high of over US$80/kg in mid July. This continues a steep upwards price trend established last year, fuelled by growing market tightness arising from constrained co-product vanadium supply coupled with firm demand amid new standards for Steel rebar in China. We have lifted our 2018 price assumption from US$50/kg to US$68/kg (simply bringing it in line with the year-to-date average), the increase more than offsetting the negative impact of lower near term production expectations to raise our 2018 consolidated EBITDA estimate by 40%, to £91m (£54m attributable).

We see considerable upside to both our earnings estimates and valuation should current elevated vanadium pricing levels hold.'

So with conservative FeV price assumptions of $68 per tonne for the remainder of 2018, ARC calculate £54m Ebitda for 2018. Let's say £50m pre tax profits. Therefore post tax, say £39m.

PE 15 - Market cap £585m, 53p per share.
PE 25 - Market cap £975m, 88p per share.

Not bad based on low production of 3,000 tonnes pa, low FeV prices $68 per tonne and only including Vametco at 59.1% ownership.

There's significant upside on all of those figures! :)