FM on Directors Talk 12.06.19 (Part 1)
"There's been quite a bit of news flow for BMN over the last month or so. Now towards the end of last month you provided an update on the Vametco Indicated Mineral Resource. Can you just talk us through the highlights?"
"Yes. We essentially provided an updated resource statement for Vametco. As you know Vametco is our core current producing platform and following some additional work that we did from drilling we are very pleased with the updated resource which reflects a significant increase on our resource size and confirms the great quality of our resource base. So we now have a resource base that is 187 million tons with an average grade of 1.98% V2O5 which represents an increase of some 31%, as well as a growth in our reserve of 85% to 48.4 million tons. And again importantly is a growth that is not at the expense of the quality of our resource base and the reserve grade is 2.02% V2O5 which is fantastic."
"It is indeed. Now we also saw Final Results for the period 31 December 2018. In your view what were the key points that investors should take from those results?"
"It's the first time that we have the results reflecting the consolidated position of the company including Vametco, which we acquired starting in 2017. So for the first time you can see the impact of an asset like Vametco on the performance of BMN, which on a consolidated basis demonstrated very solid financial figures of $192 million revenue and Ebitda of $101 million, with a very strong cash position of $42 million. And of course underpinning all of this is Vametco itself which demonstrated its attraction of its solid proposition to us as a low cost producer. One other point that I think you will pick up from our Financial Results which is important to highlight is the fact that we've achieved these results without any debt on our balance sheet. So that positions us very very well for growth going forward."
Stodgy88 this morning's winner!
Great news that vanadium price continues to rise sharply. FeV 80% up 2.74%, V2O5 up 2,43%.
Remember a rise of 2% per day would take just 35 trading days for V price to double. Average Vanadium Nitride rise over last 5 days is greater than 2% per day according to AsianMetals.
Not sure this is the best share to short just now.
Looks like the rapid rise in V price, and in particular Vanadium Nitride, has inspired a new competition "Who's first to report the daily price rice". I only managed 4th place this morning because 3 people were sadder than me! I'll get you tomorrow!
On a more serious note it does demonstrate that there is increasing interest here in the rising price of Vanadium.
I think using the term "drift back up" somewhat underplays the recent quite large daily increases in the V price. Even a daily 2% rise would take only 35 trading days for V price to double! (Vanadium Nitride last Thursday up 3.38%, Friday up 1.69%, today 2.72% according to AsianMetals)
Have those shorting BMN noticed that the Vanadium Nitride price is rising fast? Well I am happy to point it out to them! If the rising price of Vanadium continues I wonder which of our furry friends will be left holding the losses as the share price responds to this uptrend and to the positive news flow that is well underway from BMN. In my opinion the only doubt about the share price is just how fast and how far it will rise over the coming weeks and months.
Just my opinion.
Good to read a realistic appraisal by SP Angel of Eskom's need for renewables and energy storage, rather than the "Eskom's basket case" stuff that one or two posters have put up recently. Reinforces the great opportunities with SA for BMN.
However delighted to read this morning's RNS.
I reiterate my belief that the sp will be driven by both the V price (up again today) and multiple strands of positive news from BMN, today being a fine example.
Good to see the vanadium rental model now real and not just a talking point. FM / MN delivering once more.
Just my opinion.
We should be pleased but not surprised by the continued rise in Vanadium prices. Remember that Terry Perles ("soon") and others not only predicted this recovery but gave very plausible reasons why.
To be honest I don't really care why ... just very encouraged to see what looks like a sustained rise in Vanadium prices.
If this leads to a significant relate in V price it should quickly translate into higher share price for BMN. Perhaos more importantly it provides a better base for what many of us expect ... a flow of positive news pushing the sp up to levels more reflective of what this company is achieving.
I agree with others that say the professional shorters will know when to exit ("soon"?) but the nasty little amateurs may well get caught. I do hope so.
Just my opinion.
I believe significant rises in the sp will not be delivered by a single factor. Diversity is the name of the game with BMN. You could argue it's the USP.
Therefore I think a combination of news will drive the sp in the coming months. Obviously the V price rising will play a significant part but it needs to combine with increasing production at Vametco, completion of the Vanchem deal, JSE listing, significant BE developments, Mokopane licence, etc.
As these things all fall into place the market will respond. How quickly and how far? Sorry but I don't have a crystal ball, but I expect the sp to end the year a long way north of here.
2019 / 2020 looking very exciting.
Just my opinion.
Thanks for that Paludina. Thought I would draw it to your attention just in case it's relevant. My first thought was were some ships avoiding the port if paperwork etc problematic. Unlikely though.
All that guff don't confuse people's right to challenge your views with"shouting them down".
Where is the false optimism?
Have you read the RNSs?
Have you seen the recently reported increases in V price?
Have you understood the strategic skills of the BoD, backed by the technical support of the Profs Viljoen, leading experts on the Bushveld?
Do you understand how well placed BMN is to benefit from the fledgling VRFB industry?
Have you understood how the vertical integration model (now being acknowledged as the way forward by others in the industry) allows BMN to benefit wherever the V price goes?
Have you not noticed the production increase in March p, hopefully heralding the success of changes made at Vametco?
Have you not understood the significance of acquiring Vanchem, and largely with in house funds?
Have you not understood the significance of diversifying both the number of production bases and the range of products?
Have you not understood raised revenues by more than 6,700% over two years?
Remember that BMN was one of the best performing AIM shares in 2017, even when Zuma was in control.
This is no false optimism. All the evidence points to a great future for this company and its shareholders, whatever you may choose to think.
Paludina are you aware of the cyber attack going on for a few weeks now that has shut down much of the Baltimore Govt functions? I am wondering if this is affecting published info on Nitrovan shipments landing in Baltimore?
Plenty of info on the Internet about the cyber attack.
Yes atg... Under Zuma.
Ramaphosa in charge now.
Now can we agree to differ and let the bb get on with BMN. You will be well aware that I am very tenacious and will happily argue all day long on this. I would suggest that is not in the interests of the BMN bb. Ball in your court. Back to BMN or more of this. You have the controls.
Faramog if there is one thing I resent it is misrepresentation of what another poster has said. Who here has ever implied all milk and honey in SA? I certainly haven't. Or are you stating that as your opinion lol.
And your other comment "Ramaphosa has a mandate yada yada yada" hmmm.
Sorry Faramog but it is a fact! Prior to the election there was some doubt that the ANC would achieve even 50% of the vote. However they did and by a significant margin. Ramaphosa reversed the slide in ANC support, has a majority and therefore a clear mandate for his reforms and anti corruption policies.
I am no lover of the ANC though I do admire Mandela. Ramaphosa was his preferred choice as successor but that was blocked by others in the ANC. Finally he has secured that role as President. SA needs stable Government, something that arguably we don't enjoy at present.
I wonder how much ANY UK political party would give to secure 50% or more of the vote? Ramaphosa's mandate is much stronger than any party in the UK currently!
Nobody underestimates the scale of the challenges ahead but he has the strength and experience to move the reforms forward. This will take time and will not be easy.
More importantly Ramaphosa is very experienced and knowledgable about SA's mining industry and has identified that as a sunrise industry. BMN sit in a position that absolutely delivers his policies. That is the most important point for me as a BMN shareholder.
As far as investment is concerned remember that BMN is debt free and a large part of their business ambitions will be self funded. The decline in the value of the Rand and a rising V price will both work strongly in our favour.
It is definitely not all milk and honey but changes are going in the right direction in SA for BMN. It is not without risk but SA needs Ramaphosa to succeed. The alternative would be far worse.
Just my opinion.