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1 September 2020
Fatality at the Moma Mine
Kenmare Resources plc (LSE:KMR, ISE:KMR) regrets to report a fatality at its Moma Titanium Minerals Mine (the "Mine" or "Moma") in northern Mozambique on 31 August 2020. Initial investigations found that the employee, a front-end loader operator, suffered a fatal crush injury during the night shift at Wet Concentrator Plant (“WCP”) A’s dry mining operations.
Kenmare suspended all mining and processing operations at Moma following the incident and an investigation by mine management and the police has begun. Kenmare has notified Mozambique’s Ministry of Mining, Ministério dos Recursos Minerais e Energia (MIREME), and remains in close contact with Ministry officials. The Mine has now resumed full operations, except for WCP A’s dry mining operations, which remain suspended to allow further investigations to continue.
The thing with Ponzi schemes is that it is always those who are last to the party who are last to realise what is going on.
For the last 15+ years Kenmare has operated as some kind of Ponzi scheme, always sucking in new investors and taking on new borrowings but never paying a decent return to investors. The second pond was supposed to provide a great return to investors, but never has. The BOD continues to mislead shareholders to the current day. The WCB move was promised to be funded from cash flow, but net debt now exceeds $50m, and a proper explanation for this outcome has never been provided. Put this into another context, this $50m of debt that was not supposed to exist equates to 20% of the company's current market valuation. I would love to see everything come right next year, as the BOD promise, but I am still very sceptical based on the BOD's 15+ year track record.
Profitbagger, better stop citing the 10% sp gain over the last two days. It's already given up 3% so far today.
What's the matter with you Profitbagger? This board is for people who want to discuss matters related to Kenmare, not for insulting other posters and their views without any sufficient grounding. Contribute when you have something useful to say, or else bu**er off
"keep losing money on your investments"? No, I have only lost money on Kenmare. 10% sp rise, great, but with very low trading volumes. The shenanigans here include 'pump and dump', so watch out.
After several years of ramping this share, Buck obviously realised that his rhetoric had become ridiculous. 2-3 years ago all the dreamers (myself included) were expecting a £5 share price within 6-12 months, and look where we are now. And where will we be this time next year, or at the end of 2021? If the broker forecasts of $168m EBITDA came true, a £5 share price would be very possible, but with MC and the BOD at the helm, no chance of this happening.
Over $1.2 billion has been invested in Kenmare to date (capital expenditure), which will soon be > $1.3b, and the company produces a measly $12.7m profit. What kind of return is this? MC is a master of communication. In every announcement there is something to give the shareholder hope (this time the increased ilmenite recieved price of $217/t and the WCB plant move to be completed in Q3) but in the background there is always bad news too (higher costs and debt, falling sales prices in H2). https://www.independent.ie/business/irish/kenmare-says-minerals-prices-to-fall-39463694.html
Hope you are right. The conditions are there (global supply shortages, rising ilmenite price etc) for great progress in 2021, but I have been having the same dream for many years now.
Sagacityrules, at today's values, Kenmare was trading at 12,030p in February 2012 and today it is trading at 220p, and you expect LTHs to be grateful. Yes, I made a misjudgement investing in this company, but the misjudgement was being taken in by the BOD's lies. The BOD rejected two approaches for takeover by Iluka. In old prices, they could probably have obtained between 15-19p. MC and chums said that this undervalued the company and then took the share price down to below 1p. Do you think I would have preferred 15p from Iluka or 1p from the BOD? And this is ignoring the other lies like "we are considering commencing payment of a dividend", less than two years before the company nearly went under. Everyone has their own opinions but I am not a commentator as Richtwotwo suggests, but a LTH who has witnessed many shenanigans first hand.
The company nearly went bankrupt in 2016. To survive, the company issued new share capital and new investors were brought in. The existing shareholders were pretty much wiped out in the share consolidation. To break-even on my original investment I would need the current share price over £80. Unfortunately, I bought into the BOD's story and have several times topped up since then, each time "losing" more money. You can look for news reports around this time (2016) and look back through the company's announcements, e.g. using Investegate.
Was it really necessary to reduce the dividend when the company is supposed to be making US$168m EBITDA next year (according to some broker forecasts)? Probably because it will never happen, not next year, or the year after, or even the year after. Brokers have been permanently way-to-optimistic continually over the 11 years I have been invested. More often than not other companies maintain the dividend despite a dip in profit when they want to convey a confidence in the future.
Actually, the dividend is not fixed. The dividend policy is to pay a MINIMUM of 20% of post-tax profit. Thus, it could easily have been maintained at the same level as last year. But then there would, of course, be less cash available to pay the BOD bonuses and complimentary shares. Shame that I had to pay for my shares while others get there's for free, and I have been patiently waiting 11 years for some kind of decent return while the BOD handsomely reward themselves every year.
a few things did not go down. Cash operating cost/t of finished product increased by 20% and cash operating cost/t of ilmenite increased by 53%. Reported debt DOUBLED. Why, if everything was going to be financed from free cash flow?
highlandmatt, for the last 10+ years there's always been an apparently plausible excuse for continued poor performance, it's never the BOD's fault, but somehow the record never changes. Maybe WCB will be the case of "the boy who cried wolf" or maybe miracles will finally happen.
Revenue down 4.8%; Pre-tax profit down 30%; Profit after tax down 42%; HMC output down 12%; Ilmenite production down 19%; Rutile production down 34%; Zircon production down 8%; dividend payout down 13%; share price this morning down 1%. This is not good enough. There is always an excuse for the unsatisfactory performance. Ten years plus of unfilfilled promises is what shareholders have received from this company. The only winners have been the BOD with their fat salaries and benefits packages. Wake up people.
Dividend reduced from US$2.66 to US$2.31. The cost of the dividend is not so great. Surely, it could have been retained given that the company is promising riches from next year. It's always easier to promise the jam tomorrow than to share some today. See the following on the over-rewarding of our CEO: https://simplywall.st/stocks/gb/materials/lse-kmr/kenmare-resources-shares/news/does-kenmare-resources-lonkmr-ceo-salary-compare-well-with-the-performance-of-the-company/
On first glance, some positives, particularly regarding the relocation of Wet Concentrator Plant B. But an investor should never ignore the bottom line, which usually disappoints at Kenmare. This time, profit after tax has FALLEN 42% year on year. So much for an increase in dividend. And why is net debt climbing so high? The WCB move was supposed to be financed from free cash flow.
Sagacityrules, you cannot possibly know how long I have been invested in Kenmare, which rather reveals the limit of your intellect. Why would anyone lie about this, and what is the point in challenging such a claim? This board is for people to express their views and insights. No one is forcing you to accept mine. Greeno makes many good posts, but the one I responded to was potentially misleading. I was merely pointing out to users of this board that realised prices are usually very far from the list prices. I am sure that Greeno realised that I was not advising him to do research but for any other readers who are interested in the current market situation. You tell me to not post with or without caveats, which is why honest posters use the term 'dyor', reminding users of this board not to accept anything posted as fact. The tone of your post leads me to believe that you are likely another one of the company's paid posters. Today's update makes it perfectly clear that the H1 results will not be good, so it seems pointless to argue otherwise.
So, Covid is increasing the cost of the WCB project by more than $10m. And operating costs will not be coming down (as promised) well into 2021 due to having to truck HMC from Pilvili to the mineral separation plant. At this rate we won't be receiving the jam until 2022, if ever. Not a good update, really.