Tim Watts, CFO at Shield Therapeutics #STX presenting at our Life Sciences Investor Briefing Watch Now
Pat I think many here will agree with you.
In my opinion when (not if) the world and the investment community wakes up to the potential of VRFBs the existing BMN shareholders may be in a rather wonderful place.
Sanchez I apologise if my comments have raised your blood pressure! But I think you may have misunderstood the relevant paragraph. It was about BMN and comments directed at the company and not the sp or the market. Perhaps I should have been more clear about that.
"So in my opinion BMN are embarking on a very exciting period of expansion and diversification ... "
I was certainly not referring to your post and like everyone here I have some frustration with the sp. However as I have stated many times I focus on the company activities, not the day to day sp, and that is where my comments were directed.
Hope that helps.
Vaux all relevant info about the Dividend Policy us in the public domain.
This from the Final Results RNS:
"The Company recognises that while the value proposition to shareholders is primarily of a capital growth nature, it will have sufficient cash generating capacity to pay dividends in the future. On this basis the Company's Board of Directors takes this opportunity to announce the establishment of a dividend policy. The dividend policy reflects Bushveld Minerals' commitment to return cash to shareholders while prioritising its stated growth strategy. The dividend policy is based on a free cash-flow pay-out ratio. The Board believes this distribution approach is the most suitable for the Company as it takes into account both growth and acquisition capital expenditure. The Board will review the free cash flow generated by the business, the outlook for business conditions and priorities for capital allocation on an annual basis. The Board is not recommending a dividend for the year ended 31 December 2018."
This from the FM / MN interview:
"On the dividend policy we didn't so much change as announced our approach to dividends. It is the first time we are actually explicitly stating how we view dividends going forwards as a company The key points we wanted to highlight there were firstly that as a company we are still very much a growth story and therefore a big chunk of our proposition is capital growth. However we as a low cost producer we are a cash generating business and we believe that with the growth ahead of us we will be in a position to fund our expansion and our growth and still have sufficient free cash flow to pay out a dividend and we just wanted to clarify that when we do do that, that will be based upon a payout ratio on free cash flows."
What more can they say?
As I understand it from the above they want to return money to shareholders but they are still a growth company and therefore no dividend on 2018 numbers as needed for investment (and rightly so. They cannot give info for 2019 free cash flow and dividend until numbers for 2019 are known. What is so complicated about that?
Just my opinion.
It is worth remembering that BMN are building a low cost vertically integrated vanadium platform. This not only creates a diversity of revenue streams but also hedges against both high and low V prices. People keep asking about the sp and why it is where it is. Well putting aside market manipulation the above is a work in progress and other than Vametco the other revenue streams are not yet in place ... but they will be! And that starts soon with the Vanchem acquisition.
This quote from the FM / MN interview highlights this:
"The energy storage market is potentially 5 to 10 times bigger than the commodity market just selling V into the market. So for us it's almost a no brainer and it gives us a very good hedge in terms of the vanadium price. When V prices come off while the mining and processing prices may come down the attractiveness of our energy storage solutions goes up. The best of both worlds."
The development of the Electrolyte leasing model also hedges against high V prices affecting VRFB take up, and the acquisition of two brownfield Vanadium primary production facilities has hugely reduced the Capex costs to achieve very significant revenue and profit from the mining and processing side of the business.
This all highlights the strategic brilliance of Fortune's vision.
The next quote from the same interview highlights what can be expected in the short to medium term:
"So we have to appreciate that it's not the most straightforward story and it's one which I think the market will only fully appreciate as we deliver very granular initiatives such as the electrolyte plant and we start to produce electrolyte, we deliver the electrolyte rental contracts and the market can see how that works and how it translates into value. As we deliver deployments of VRFBs and as we demonstrate what sort of partnerships we are going to do with VRFB manufacturers. So I can understand why the story is not yet fully understood or appreciated but I think it's only a matter of time."
So in my opinion BMN are embarking on a very exciting period of expansion and diversification that should lead to significant returns for the shareholders. I do sometimes wonder if those expressing frustration, impatience or negativity fully understand what the company has achieved and just how much more is to come. The future looks very exciting to me!
Just my opinion.
Aisee I understand your frustration but allow me to repost from August:
"I notice questions today about why the market isn't recognising what BMN has achieved, putting aside the fact that 3 years ago the sp was less than 2p. It's interesting that in the recent interview Fortune referred to this and hinted that the market will awaken as the various projects start to deliver.
Some may remember that on a number of occasions I have given my opinion, which is that we are currently in a phase in the company's history where the early growth from explorer to mining and processing company has been completed. BMN are now putting in place all of the building blocks that will enable the next very significant expansion of the production of vanadium and diversification of both products and production sites.
This has not yet been completed and the market is not very excited by this. But it should be! However we have a lot of very savvy investors here that see where this is going and have sufficient knowledge and understanding of BMN to recognise the enormous potential of their investment. That after all is the trick ... being ahead of the game.
It is my opinion that throughout the remainder of 2019 and 2020 we will see the company begin to deliver on the various projects, starting with the Vanchem acquisition, and the market will awaken to what we have.
I believe that the shareholders are in for a very interesting time.
There will always be the trolls, derampers, impatient pi's, etc. There were in 2016, 2017 and 2018. But they were completely wrong in the long term. We are seeing the same things being posted today. I expect they will be wrong again.
I trust Fortune to deliver these projects. I trust Fortune to do this with minimal if any dilution. I trust Fortune to give further great returns for shareholders. And I trust Fortune to know how to achieve all this without needing advice from us!"
All just my opinion.
Eskom VRFB project continues to run following upgrades made to the VRFB battery. The battery passed a series of manufacturer and Eskom site acceptance tests in January and February. The battery will have peak output of 450kWh and is co-owned by Bushveld Energy and the IDC.
Vametco based Solar Mini-Grid Project: procurement to start in next few months following assessment of grid connections and local environment. Solar farms to supplement grid power are seeing significant growth in South Africa due to unreliable and increasingly expensive grid supply.
Vanchem: The deal has yet to receive approval from the South African competition commission. (Since granted - RNS 29 August 2019)
Good progress is reported and the company is confident of meeting the 31 October date for completion with additional debt finance to come from local banks.
Lemur: revised BFS on the coal mining project, including both surface and underground mining to start this quarter.
JSE listing delayed till 2020 pending auditing of the Vanchem business as required for any listing.
Ferro-vanadium prices rose in China last week by 2.8% to US$36-38/KgV. Ferro-vanadium prices held steady in Europe at US$30-31.05/KgV. (FastmarketsMB)
Valuation: The fall in unit costs raises our valuation for Vametco and Vanchem following its acquisition to 92p/s from 90p/s. We value Bushveld’s ownership of Bushveld Energy at 8.8p/s and we have adjusted our valuation on the other assets within the group to 5.4p/s.
Conclusion: It is remarkable that improvements at Vametco mean the business has almost met our full-year EBITDA forecast in the first half.
While we expect current ferro-vanadium prices to lead to lower margins though the second half, unit cost reductions should serve to offset much of the reduction.
Our post-tax profit for the year rises to US$50.0m from US$43.6m for the year assuming received ferro-vanadium prices average US$50/KgV for the year.
The fall in the pound-dollar rate also makes the figures look even better in Sterling terms.
As we have some negativity on the bb (sadly from the usual suspects) it is important to add balance backed with facts. SPAngel 31.07.19 does just that:
Bushveld Minerals* (BMN LN) 25.5p, Mkt Cap £285m – EBITDA rises by 15% year on year as management drive down unit costs
(Bushveld Minerals owns 74% of Vametco, 84% of Bushveld Energy in South Africa, 100% of Lemur Holdings, 9.5% of Afritin)
(Vanchem: Our figures include Vanchem production of November and December of ~80mtV per month)
BUY – Valuation raised to 92p from 90p
Bushveld Minerals report a significant improvement in vanadium production in the second quarter.
Production of ferro-vanadium sold as Nitrovan rose by 14% in the quarter to 742mtV vs 649mtV in Q1 taking production to 1,392mtV through the first half.
A series of improvements have increased production through mine scheduling enabling better quality material into the kiln together alongside better feed and recovery rates.
Production target: the work means Vametco should be on target to meet current 2019 production guidance of 2,800-2,900 mtV.
Management expect to achieve a run rate of 3,400mtV in 2020 for no additional capital cost and continue to review the timing and investment to get to >4,200mtVpa based on a name-plate capacity of 5,000mtVpa.
Costs fell 14% to US$17.40/KgV in the first half vs US$20.2/KgV a year ago driven by higher feed rates, a weaker rand and other cost initiatives.
Cost guidance remains unchanged at US$18.90-19.50/KgV for the year as we expect the SA rand may appreciate through the second half.
H1 EBITDA was US$48.6m vs US$42.4m a year ago with margins > 50% due to the focus on unit costs, relatively good ferro-vanadium prices and weaker SA rand.
H1 Revenue was US$74.3m in H1 vs US$81.2m a year earlier when ferro-vanadium prices were higher.
H1 ferro-vanadium prices were 14% lower yoy at US$56.3/KgV.
Both sales and EBITDA benefit from a relatively strong ferro-vanadium price and the lag in pricing from December 2018 which feeds through into Q1 this year
Vametco also successfully completed wage and benefit negotiations with the AMCU union to run from 1 July 2019 to 20 June 2022
Bushveld Energy - Electrolyte Plant EIA on track to be completed this year with samples sent to vanadium battery companies for testing.
Electrolyte rental: The financing of VRFB’s through the leasing of vanadium in the electrolyte has got off to a rapid start with the implementation of a first rental contract with Sandbar in the US though Avalon Battery Corporation. Bushveld management are also working on a dedicated vanadium electrolyte rental fund.
... anyone has noticed (or cares) that I am posting less frequently let me reassure you that my commitment to BMN has not changed.
However during this quiet news period I have nothing new to add and don't wish to keep repeating the same points (unless I see utter nonsense being written about my investment)
More importantly I am concentrating on getting through the final cycle of chemotherapy ... then freedom!
Off topic ... If any readers that have experience of travel insurers that are sympathetic to cancer patients within first year of treatment I would be grateful for any information. Thanks in anticipation.
Alfa I certainly wouldn't want to challenge you on industrial production, science of vanadium, etc. However their wording does specifically suggest further capacity for electrolyte manufacturing.
Interestingly they separately state "The Vanchem Business is capable of producing various vanadium oxides, ferrovanadium and vanadium chemicals, complementing Vametco's existing Nitrovan offering."
So they are suggesting both vanadium chemical production, as you said, but also additional electrolyte production capacity at Vanchem. Could be ambiguous wording on their part but I wouldn't rule out production at Vanchem if the RNS is to be taken at face value.
Either way all good for BMN and its shareholder.
Just my opinion.
Sanchez I wouldn't worry about that little man.
He had a pop at me for saying that BMN is delivering on its business plan which is to create a low cost vertically integrated vanadium platform (something that should be self evident to anyone with an ounce of understanding of BMN). I guess he is just too stupid to understand that.
Give it a rest expert. You sound pathetic trotting out the same negativity about other shareholders.
And for your information there is plenty of debate on this bb. Anyone can express an opinion but equally anyone has the right to challenge an opinion. If one can't take the heat then stay out of the kitchen.
Please name one regular poster That wants the sp to go to 12p. That was an outrageous lie. Shame on you.
We all want a higher sp but if an opportunity to buy some more presents itself then if funds allow I will happily take it. You have a problem with that?