Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
Cloudy Mountain: Can you check your figure of 16% yesterday and 11% today, please? I took a quick look and declared short positions are 1.4%.
re: "also on IG Index (small retail shorts) there's more than normal short customers 16% yesterday, 11% today. Normal is about 5%."
This is referring to customers of IG Index who hold TGA in ISA's SIPP's CFD's Spread Bets and dealing accounts. It's the percentage of people who are long or short..NOT the volume of shares. Today 9% for their TGA holders are still short.
I Gave Dark Knight a full explanation about this in my post of: 10 Aug 2023 12:21. It's a useful tool.
Fromage: Overner : "sold them at their peak" may have been more convincing if you posted that on Friday rather than days later :)
I don't always get it right, sometimes spectacularly wrong !. I sold half my TGA shares late Feb 2022... just as Russia invaded Ukraine. See my post: 26 Feb 2022 12:07. Talk about bad timing !
TGA's share buy back program will be finished by the AGM in May. There's some big shorts been building up, and on also on IG Index (small retail shorts) there's more than normal short customers 16% yesterday, 11% today. Normal is about 5%. Tempted to hold off buying back in for while. Or buy in small tranches.
Overall though with RB coal prices up to about $110 from $92 recently bodes well going forward, as this equates to another $200 million profit p/a ?
2023 year end cash esitimated a 9.6 billion Rand. (see RNS mid Dec 23) that's 393-394 Million UK pounds. EPS est 31 to 36 Rand ...about £1.35 (see RNS Jan 24).
So with TGA valued at £585.23 Million at current share price, 67%+ of that is currently sitting in a cash deposit. Leaving the non cash assets of TGA valued at only £76 million.
What can we expect for 2024 ?
Based on the RNS update TGA gave 13/12 23, here's some rough estimates based on current low prices.
South Africa operation: FOB Richards Bay costs 1170 to 1250 Rand / ton inc royalties. Let's say average of $63. Recent RB prices $93 / ton LESS discount. Discount was 15% in 2023, narrowing as prices fall. Let's say 13% discount- prices obatined $80.91 / ton, TGA profits $18 ton. Times 12 million tons. There's $216 million profit there.
Ensham: FOB costs 1947 Rand/ton = $101.56 / ton costs. Recent Newcastle prices, say $129. PLUS premium to benchmark 10% (see RNS) ... TGA gets $141 ton. About $39 / ton profit. Estimated annual sales 3 millon tons (see RNS). There's $117 million profit here.
Total profits for 2024 based on current low coal prices $ 333 million. Any thoughts ?
At $95 it's getting a bit marginal. Don't forget the 15-20% discount for TGA coals. Brings it down to $75 to $80. That's close to TGA's FOB costs. I'm looking to get back in too, but am waiting for coal prices to rise.
"Overner I can't see a 6% short on tga ??? Where are you getting that information ?"
Sorry for the delay getting back. Was talking about Market Sentiment on IG Index. If you have a IG account, ISA, Dealing, Sipp, CFD, Spread Bet.. when you get TGA up in your workspace you will see a Market Sentiment button. This gives info about what other IG clients are doing, or have done.
It gives number of clients into TGA (1-50 / 51-200, etc) on their platforms and also gives proportion Long or Short. From long term watching, TGA seems on the cusp of 50 clients involved, sometimes breaking into the next band 51-200. I would guess between 40 and 70 at most times.
Over the last few months the Shorts have been between 5% and 6% of their clients. The Longs 94% to 95%.
Yesterday morning Shorts stood at 4%. As the price rose rapidly, by the afternoon the Shorts had risen to 5%.
This morning the Shorts had dropped to 3%
From this info I would guess that ONE person took a short yesterday lunchtime, and since then maybe 2 people have closed their shorts (hopefully at a big loss !). And maybe one or two are still short...
This Market Sentiment info is of use if you check it regularly, to see which direction the sentiment is going.
The other thing worth noting, is it ONLY gives numbers of clients long or short. Most Longs will be unleveraged, in ISAs, etc. Shorts will always be leveraged 5:1 10:1 etc. using CFDs or Spread Bets. So although the Shorts appear small in number, their effect on shares sold is magnified by their leverage. And their losses huge when the SP moves up 10% like yesterday...
I would say that it's dangerous to have ANY leveraged position in TGA, Long or Short. The moves when they happen are explosive and could wipe you out.
Short seller activity has increased from 4% to 5% on IG index client sentiment in the last 2 hours. It was 6% a while back and gradually dropped to 4% in the last week. Today someone is piling on a short.
TGA is a leveraged play on the price of Richards Bay coal. Which looks like it's found it's bottom level now after the lunatic levels of 2021. If you think coal will go sub $80/ton you should not be here. If you think coal will go up, possibly to $150/ton over time, TGA is a good keeper. As mentioned many here have had their initial outlay repaid by dividends already.
There were a couple of articles in the papers.
https://www.thesun.co.uk/news/22685841/britain-coal-power-stations-solar-panels-heatwave/
https://www.telegraph.co.uk/business/2023/06/12/britain-fires-up-coal-plant-weather-too-hot-solar-panels/
Check out Bangrak's prior TGA posts about free cash. They look pretty accurate to me:
https://www.lse.co.uk/profiles/bangrak/
And Terry, let's have some links to where you are getting your $100m free cash figures from. We would like to see for ourselves.
FOB costs inc royalties 1131 Rand/ton. That's $57. Anything TGA can get over that is profit. Bangrak is the spreadsheet man, check his posts .
On IG Index 94% are long but there are 6% short....Someone looking to close, or looking for a sub £5 entry ?
Whilst most of us on here are concerned with the profits on our investments, the ongoing price of coal, etc... There is one man who is totally committed not only to the company but also the welfare of it's workforce. That's July Ndlovu, the MD.
"People-centric Thungela named Top Employer for second consecutive year" See post Fri 10:03 from Optimus.
Mr Ndlovu is committed to making Thungela a safe and good place to work for the employees. A contented workforce is good for business, and there's plenty of PLCs who could learn from this.
All of us who've been in since 2021 have done really well, and had their intital investments repaid a few times over. Some inc. me have sold some shares off over time and locked in gains. But my remaining half I'm leaving riding. They cost me nothing, and the ongoing dividends will be worth having. In short this is a well run company that generates loads of cash.
"The strong cash generation has resulted in a net cash position of R19.8 billion on 30 November 2022"
At around £47 million to 1 billion rand = £930 million. With 134 million shares in circulation, this makes £6.90 per share that TGA is holding in CASH right now. Are my calculations correct ?
Genuine question here.. Can anyone explain why Newcastle coal futures are always $100 + higher than Richards Bay prices ? Assuming same quality coals why should a commodity from Australia be worth more than one from SA ?
Looks like Monday:
https://www.sowetanlive.co.za/news/south-africa/2022-11-17-transnet-says-main-coal-line-to-be-reopened-by-monday-after-derailment/