Member Info for pickedpeck

Nope, doesn't make sense, the LFL figures are pretty healthy, the FX tailwin added a further 8% on top. Even taking that 8% away there was over 7% LFL growth.

Something in the results I am not seeing.

So quiet here just lately, feels like we are a bit becalmed. At some point over the next 12 months there should be (!) a closing of the value gap between Araguaia NPV and the market cap. Right now the market cap is a fraction of the Araguauia Phase 1 NPV.

Quiet times and drift like this can make other investments seem attractive, safer, lower risk. Rewards here will come to the patient, those prepared to wait.

Whichever way you look at this the company is undervalued.

Asset values, income, dividend, PE ratio, PEG all show good rationale for buying and holding. The company has done nothing but progress over the last five years. I was looking originally at this passing 200 as a value point, but I think 250-275 looks more like fair value based on the numbers.

If they can close out the year end as positively as seems likely given the Q3 commentary, then we should see some recovery towards that fair value level. The current price simply does not reflect the value in the company.

Seems like a sharp drop on decent results, am I missing something here?

First bullet point:
· Group like-for-like (LFL) revenue growth of 7.4%. Price / mix improvements of 12.0% and volume decline of 4.6% (volume down around 1% excluding Lysol, as the category continues to normalise). Continued broad-based growth and momentum.

7.4% towards the top end of the forecast range of 5-8%. Continued growth and momentum comment also seems positive. Revenue up and volume down surely implies improved margins ? Price/mix seems to have improved across the board also.

So, I'm a little confused at the drop.

Rover, I don't remember the figures off the top of my head but I seem to recall that Vermelho is a much smaller license area than Araguaia and is already much better explored. It's more likely that resource expansion when / if needed would come from one of the other properties in the portfolio.

However a 38 year mine life is more than long enough, a second cloned line could take it from 25 - > 50kt pa. I wonder if that was Vale's original plan, two smaller plants rather than one whopper.

TDT - what specific problems do HPAL plants run into? Power and water supply shouldn't be a problem, and if you are just cloning a smaller design then surely the limiting factor becomes the resource?

The other option is cheap and cheerful trucking of ore to extra lines at Araguaia. Pretty sure they could do this just by adding RKEF lines 3, 4 , n at Araguaia. Skips a lot of the cost, waste handling, construction, permits etc. They have often emphasised this is a nickel district rather than a nickel mine.

It's interesting who it has been awarded to. Horizonte are at pains in the RNS to emphasise the 25kt p.a. forecast from Vermelho, but Wood must have been involved in Vale's 46kt p.a. FS forecast previously. Wood must have all the previous data and plans, so why appoint them if you are going to stick to the 25kt pa?

Will be interesting to see what this FS says.

There is no point comparing the three companies. Their only similarity is that they are businesses related to mineral extraction. HZM is building a nickel mine which has globally relevant scale. It has a costed and funded development project in mid build cycle. It is sat on vast nickel and cobalt resources which have had drilling campaigns which run into the thousands of drill sites. Hundreds of millions of dollars have been spent proving the resources by mining majors Vale and Xstrata plus HZM themselves.

I know there are people who invested in both HZM and RMM, I never really understood the logic for doing so. RMM is an ongoing turnaround copper mine story, a turnaround necessary because they don't make money and don't seem to have the necessary economies of scale to do so. ATYM have a much stronger copper story complete with profits, are a multiple in scale, but have also dropped 50% in price over the last six months based on expected margin squeeze.

GLR is a tiny company still drilling and exploring. The idea that they suddenly have the money to build a mine and will be magically remain debt free shows a failure to understand the real costs of building any sort of mine. Open pit mines are cheaper than deep mines, but one mine truck is still more or less a million dollars, and one digger is more or less double that. You generally need more than a few of each. Beyond that you need to be able to process ore, even if you are just stockpiling and transporting elsewhere. Processing plants are very expensive, but so are power lines, access roads, offices, water and waste management, permitting, environmental certificates, and licenses. Even going from discovery to JORC to FS is an expensive process. They may make it, but if they do they company will not even remotely resemble the one today. They are at a completely different stage of the development cycle.

I have noticed naive investors start talking about the potential value of the material in the ground as if it is somehow just cash to be dug up with spades and shoved directly into shareholder pockets. Happens in oil, gold, copper and even nickel and lithium sometimes. All it actually means is that over the life of mine there may be sufficient production possible to make a profit, which means you have some chance of raising the necessary capital to do so!

Hazbeen, that's right, I think the banks wanted to conserve the contingency in case of unexpected construction delays rather than to account for inflationary pressures.
If the ETC used all the current contingency then it left nothing in reserve.

So basically you want to talk the share price down as far as you can because you think the asset is valuable and you missed the 1.5p boat from three years ago. The rest is just fluff and nonsense, the idea of you as some sort of philanthropic investment counsellor is a bit too much of a stretch.

The buyer here waiting in the wings is Glencore, likely as their Xstrata staff are kicking themselves for letti g it go in the first place. I agree they will want it cheap, but I think their view of cheap will be anything under 300p as it goes into production as that would still be a big discount to NPV and discount Vermelho to nil.

So from your reply at some point we can look forward to you flipping the type of comments you make, presumably the signal that you have finally decided to buy rather than talk down.

There is a risk, an every day risk, with this company. Ford, Tesla, VW, the Koreans and others are looking to partner with green nickel miners. Any type of announcement of a partnership on A or V would see the price rise very rapidly. I think its possible, even likely, that we will see an RNS like that over the next six months.

Don't try talking it down for too long.

Could say the same to you. HZM is also a low risk open pit mine, the cost is nothing to do with digging the ore out of the ground, it's much more about the processing plant and utility hook ups like electricity and transport.
Having targets is different than having a working mine. Being in production in six months means the plant is built, roads, water, and electricity are in, pilot plant is running and the process flows are being tuned. Glr seem a fair way off any of that.
12x6km sounds big doesn't it? Araguaia is the size of Surrey.

So again, why are you gere Contrarian? You're not invested, so are you spread betting against the price?

I can't see any other reason for you to be spending your invaluable TA skills here.

Simple question, why have you never answered it? Why are you here?

funky - is that why you are in GLR, six months before production my ass. Have you ever heard of the Lassonde curve?

I'm expecting this to bounce off the 16p range back up into low-mid 20s. I like the acquisition as it alleviates one of my previous concerns on PAF, and the cash generation remains strong. I also expect the dividend to be at least held, so can sit and wait for the price to recover.
All in all a reasonable safe haven in wobbly times.

Considering you are not invested here why are two thirds of your posts on LSE about HZM? you ahve never clarified that, be transparent.
11 trades so far today, any price movement could be dramatically changed by one large trade. Hardly the stuff to be spouting your TA nonsense about.

The banks will have insisted on the cost to complete exercise, and also insisted on more conservative contingency being applied. Given the $60m contingency still remains with something like $375m already committed, the $60m is a much higher percentage of the remaining spend than it was before dollar one was committed.

So $60m contingency on $200m remaining spend, vs $60m on $477m original planned spend.

Will the fundamentals of the business about to be published in the results on the 27th shake off the wider market malaise? I think so, I think we may see some positive movement over the next two weeks in the run up.
What sort of numbers do we think they will show?

Amazed to see this break 50p today, feels like an overdone sell off. Housing market and build projects being shelved may impact the bottom line, but house builders don't seem to be suffering as badly as Bree.
Is this as low as it will go or is there worse to come?

Bald_eagle - Its more that there seem to be a number of posters on the LSE boards that do nothing other than predict catastrophe, or at least allege they are not buying until some ridiculously low threshold is passed. Maybe I am being paranoid, but tinterweb is nothing if not prone to abuse by bots and malactors.

There seems to be a fairly recent influx of people forecasting much lower prices across the board on LSE. It does look rather like a concerted effort to create negative sentiment.
LGEN is highly cash generative, div is well covered, headwinds are nowhere near as strong as the global pandemic of 2020 when the world paused economic activity. Truss and Kwarteng are temporary occupants of their respective positions, and UK plc is still one of the world's largest and strongest economies.