Member Info for pickedpeck

Who knows... maybe the inevitable ensuing baby boom from isolation will lead to a corresponding marriage boom... lots of diamonds needed. And prams. Time to invest in diamonds and pram manufacturers.

Hi Smokey, hope that's just a smoker's cough you have there :)

Its an exciting ride for sure but not one that comes to a dead end. My net worth like everyone else's is down, but I will only realise the loss if or when I sell. A longer view will see many of these holdings recover partly or fully, I can wait.
Some have held up pretty well so far, I have PAF, RAI and a few others that are still blue in my portfolio. Others look like a big paper loss, PDL and HZM down. Again I can wait :)

Taking a long view here...
Lets assume for a moment that no one at all wants to buy diamonds at all during the virus outbreak, and PDL have no means to service their debt. Global wealth is depressed, many businesses become distressed with 3-6 months of revenue impact.
During this time Governments have already started mitigations for business, cutting interest rates to near zero, offering financial support for key employers. Those governments cannot allow the world economy to just collapse under its own weight.
This may in the end actually become positive for PDL and other debt laden businesses. Assume for a moment that lenders do not want to foreclose on a huge array of businesses, realising huge losses in the process as the underlying assets in a fire sale may be worth seriously less than the debt.
I suggest the more likely outcome is refinancing the increased debt volume at a lower rate, the lenders still making margin but able to lower the repayment burden. The alternative is the lenders all also go out of business due to massive bad debt piles, that seems the least palatable route for everyone.
The bottom line is that even if production is effectively mothballed for six months this is still survivable.

All quiet here considering the drop. No RNS, no news, 20% drop ahead of the wider market. Any reason?

Less than a million sold for a 10% drop. This is really into crazy spaces now.
It’s weird, I work in clinical research and kind of know where we are up to with mitigation. There is nothing in the news about mitigation, the only reported approach appears to be vaccines but that’s not true. In China a drug that prevents the cytokine storm driving the severe pneumonia has already been added to the treatment plan for critical patients and has been largely responsible for the drop in death rate there. If the death rate dropped to no worse than winter flu would the panic continue?

What share or market would you bet the farm on if you knew corona virus was set to become first of all non-lethal within a month, and then a vaccine made available in three months?
Would the markets fully rebound or would the shock already in place make the recession inevitable?
There is a reason I ask...

You pay your money and take your chances. Good, silver, and copper in the ground will eventually have value, if it doesn’t then we really are in Armageddon and money itself will have no value - that’s simply not the case.

This message about Covid19 has been sent out to all Cineworld UK registered customers just now:

'As a valued customer, we wanted to update you on the steps Cineworld are taking to help minimise the spread of COVID-19.

We are continuing to follow and monitor official guidance from the UK Government and Public Health England carefully. It is of vital importance for us to be in a position to ensure that any and all procedures are in place to support the health and well-being of our customers and staff members.

To help combat the spread of COVID-19, we have been putting precautionary safety measures in place, including:


Educating our staff on prevention
Emphasizing frequent and proper hand washing
Cleaning high contact points more frequently
Providing hand sanitizer
Working with local health authorities

In line with government guidance, we are continuing to operate as usual. We will continue to keep in touch with you and follow official guidance from the UK Government and Public Health England carefully.

Thank you for your continued passion for cinema.

Best wishes,

The Cineworld Team

Five trades in the day, two buys, two much smaller sells and one in the middle shouldn’t equate to a 9.5% drop. This is an artificial mark down, of anything the virus outbreak will lead to an increase in demand for the type of services RAI offer.

This is getting silly now, I’m quite content to ride it all out.

That's 200k more btw... near 6m now so money where mouth is like a few others here.

I bought 200k today, operational risk for HZM is not really a factor as we are not yet in operation, nor is liquidity with a big lump of cash in the bank. Short term demand for nickel for manufacturing may become depressed, but LME stockpiles are already low. If you assume this virus issue will last the rest of this year and the economy recovers beyond HZM looks a reasonably safeish (as much as anywhere is) place to put your money. Long term the nickel price is only going one way whilst the energy ecosystem switches to stored electricity. You've also got to assume mine financing will continue regardless of other factors.

Low risk at 3p to say the least.

Where are the Auto trades on this? Is it all retail investors? Canaccord, JPMorgan, and Lombard all hold stakes, as do Teck and Glencore. Why are they not adding at this price, anyone any Ideas?

Lonlon- how do you get a 50:50 chance and in the same post say there is no chance of them going under because of BEE ownership?
Also saying they may be bought out on the cheap might be right, but that won’t be 7p a share, they are already a long way below cheap. If they were still 80-100p the comment would hold water.
They are servicing their debts in this harsh environment. If the environment gets worse, they will struggle, if it gets better they will recover fairly quickly. None of the debt holders have demonstrated anything other than patience so far. They are after all making a hefty interest rate profit and they won’t want to risk the asset that’s paying their wages.
So in my view 50:50 may be right, but it is between treading water pending a bid approach, or recovery should the diamond market pick up. I think there is a very slim chance of anything else happening because too many stakeholders have an interest in keeping the golden goose alive.

There are bad bits in here - debt up, profit down, sales prices down. Net loss.
There are also not so bad bits - positive production, savings materialising but being lost in the margin, cash to operate through the dip, decent EBITDA.
With the EBITDA and operating cash flow remaining positive it remains extremely unlikely that this company will go under.
That’s why today’s trades are relatively moderate. Most larger holders will have expected what this report said. As a result I don’t see any large sellers dumping, the volumes show that.
Recovery is nothing to do with large diamond finds, they need to trade in bulk. There has always been a level of large diamond finds from these mines and it seems extremely naive to connect that with a recovery plan.
As for price predictions - who knows. 7p appears to be current support, and the wider recovery story is still valid. However the China market will have to recover first in order to push up prices, and that is dependent on issues way beyond PDL.
Personally I see this as a hold for now.

Spreadex will be covering a position taken by a client or clients, looks like a good number of people may have placed CFDs on the price. For them to buy 5% of the stock is unusual though, that's a hell of a bet. I've never been really sure about the enforcement of insider trading rules around spread betting, just saying.

Just an extra thought. With 80.7% of shares not in public hands, and Jupiter and Black Rock holding a further 3.0 and 4.9 respectively, the share free float here is pretty low. According to morningstar Jupiter currently have 3.0%, down from 5.2% in October. In total that means only about 12% of shares are actually on the market. A lot of the balance will also be tightly held but below the notifiable threshold.

That represents both a risk and an opportunity. The low float will make the share illiquid but potentially volatile on news that creates demand - good results in April being the obvious next potential catalyst for that.

Hi CYB, I think that's an excellent summary of the position here. The only thing I would add is that the geopolitical situation in and around the countries in which they operate creates an environment where revenue opportunities for RAI will continue to grow. The fundamentals all seem to be in place, I agree the stock market listing has to be an enabler to growth or exit, or both. Either way it represents a decent opportunity for private investors as the high percentage ownership by management will put institutions off.

Sibanye I agree would be a good shout, I just wonder if the Harmony deal might make them rethink their position. Your valuation looks reasonable, which is precisely why the current state of play might flush out a bid in the nuts well below it. I would not be surprised to see a bid come in 15% up from here with a final close 20%. The turnaround in operations and the rising gold price have not managed to push the price forward as much as many would have hoped and that makes it a buyers market.

Sharp fall back on no volume so far today, must be something on the books we are not seeing.

This was interesting too

https://www.umicore.com/en/media/press/umicore-announces-partnership-with-lg-chem-for-the-supply-of-nmc-cathode-materials/