Member Info for ragnarlothbrok

Natural gas smashed through $9 today

She has been around in this company for such a long time I think it's unlikely she does anything now. I imagine all sorts of hedge and artbitrage funds would get involved if a low ball offer happened. I think a delisting would be more likely but I think this company has been listed for decades so don't know why it would happen now. It's not like she is paying herself a generous salary even. Take a look at the remuneration report, the directors and CEO take some if the lowest pay I've seen of any listed company. It's a funny one.

Trading update for the first 5 months could drop any day now. I cant see the SP moving anywhere until we get a significant upgrade on the 19% sales growth expected for this year. By my calcs this is trading on a PE of 30 so will need some significant expectations beats to encourage buying

Its official, we have lithium

I wouldn't put much faith in anything the Indonesia government says. They constantly flip flop on their decision making. They banned thermal coal exports in Feb... for one month. They banned palm oil exports a few weeks ago... for 2 weeks. How are they possibly going to create smelting capacity for that much tin ore in one year? It doesn't seem realistic especially considering they are trying to create downstream capacity this year for nickel and next year for bauxite and copper. Tin price doesn't indicate much of a market worry

https://www.nortonrosefulbright.com/en/knowledge/publications/d532b31e/indonesias-ore-export-ban-may-be-suspended-until-2022

Yes there is this paragraph from the annual report which is influencing their desire to retain huge amounts of cash

In arriving at the conclusion that the Group has adequate resources to continue in operation and meet its liabilities in the next five years the Board has assumed a worst case scenario of CPO price at its lowest average of $500/mt and that demand for CPO dropped by 50%. The Board has also factored in that half of the total plantations could be shut down for six months due to infectious disease such as Covid19.

Dividend is only $2m giving a yield of 0.5%

Also cant forgot that operations are largely based in Indonesia, which is one of the most corrupt countries in the world and with enhanced risk that this disappears from investors' plates completely

New note from Cenkos released today reflecting the latest acquisition and updated prices so their target moves from 168 to 181p. Thats some upside, would like to see that

Malik yes governance is a concern, companies like this with a large overhang are more likely to suddenly decide to delist leaving minority shareholders with a difficult choice. There are few large institutions on the register to get in the way. Catalyst for this has to be a more friendly shareholder return policy, particularly a special dividend

$32m cash generated in the 1st quarter and prices are currently nearly $200 higher than Q1. Simply immense cash flow

So I guess that Tosca must be fully out by now, so I cant blame them any more for the SP not going up. I guess the SP is holding up pretty well considering the rest of the UK domestic stocks. 25% still is not much of a free float, 7 trades today so far at 1430

toptiger a few reasons as touched on below:
- the business is controlled by Madam Lim. How much do we know about her?
- business subject to the whim of the Indonesian government (sovereign risk). Recent example being the sudden (and some might say irrational) CPO export ban and the frequent changes to the palm oil tax regime
- questionable commitment to shareholder returns indicated by a reluctance to pay out what is clearly excess cash

Gdog they each received a $500k cash bonus and a 20% pay rise. I believe the bonus targets were also increased.
They received a mix of 6.75m RSUs/PSUs as an IPO bonus
And the pool available for issuing shares under the existing employee plans was increased by 6.5m.
The entire amount raised under the US IPO will go to Tremor employees over the next 5 years.
Quite extraordinary dilution

https://investors.tremorinternational.com/static-files/076e0ecf-93fe-4f7e-90ee-19fbf62b9733

Our tin and lthium peer AVZ is having some ownership concerns in the DRC. Makes you appreciate the value of doing business in a friendly country like Namibia (Alphamin also operates in the DRC) . Your choices for tin exposure via actual production appear to be the DRC or Afritin

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02518000-6A1090370?access_token=83ff96335c2d45a094df02a206a39ff4
https://www.fool.com.au/2022/05/04/why-the-avz-share-price-went-from-being-up-19-to-down-20-today/

That was on the 26th. Check out Afritin twitter for a lot of serious people in suits talking about tin.

Very loosely follows the forward gas price. The gas price started has been moving straight up from around Friday which could explain the movement, although the SP only went up when the US came online. US makes the UK market look quaint and provincial.

Natgas going absolutely ballistic today, I think it touched a new 14 year high again. Need to go all the way back to 2008 to find the same level. This could mean a valuation lift for DEC as a result of a longer term structural shift in the gas market from the increased demand for all gas except Russian. It looks like the Russian gas will suffer from a large discount to the benefit of India and China, while all other gas will trade at a premium

But discussions around gas are mostly irrelevant as DEC have been pretty adept at limiting any price upside. I know I know safe dividend, paying down debt etc etc but the SP would be double if they had hedged 70% instead of all of it.

oh yes why its cheap is very easy to explain
At least they aren't on AIM and have two independent directors that don't have any obvious connection to mdm

You can view the webcast for the results now, not really much to add, though the discussion around the tech evolution was interesting. They sounded very confident and relaxed. They are pushing hard on differentiating their customer proposition which I think is shrewd in what is a fragmented and crowded market. Not many companies out there with the opportunity to spend £5-10m on tech investment. Very few interesting or thought provoking questions, probably reflects the limited interest in the company

https://www.hsshiregroup.com/investor-relations/financial-results/

I think we will see the full deal with this, probably around Q3 2023:
- at least 25% strategic investment ($100m) from major miners, streamers, offtakers, or even further downstream,
- project finance ($200m) from a consortium of banks led by South Africa institutions
- equity raise for the rest, maybe us plunkers will get some if we're lucky. Last year they asked for £10m and got £13m at 6p, which I think was less than a 10% discount from memory.

But by the time this happens cash flow from Phase 1 expansion will be much higher (and hopefully the economy has recovered) and investors will be queuing up to throw in cash. Anthony just needs to deliver. Don't think the price will be 8p when they are generating $50m in EBITDA from phase 1 from Tin alone though so better off buying them now!!

Indeed, looks like we have caught up that 6p in value accretion.
In this environment it doesn't really get any safer or predictable than these cash flows.
Smashed through 120p, cmon Rusty more deals and next stop 130!

So MCap of £340m ($425m)
Net cash of $220m
Net cash flow of $100m
And prices well up this year so net cash flow could be more like $150m
Whaaaat?
MCap 50% covered in cash and even if prices fall by 30% over the next year the MCap will 100% covered by cash in 2 years.

The teeny dividend is amusing, they are keeping enough cash for a 50% price decline and 50% demand decline for 5 years! I think they probably don't want to draw too much attention to themselves and how much they are profiting from higher food prices.

I only hold a small position here because, among other reasons, I'm nervous of what else the Indonesia government might do, I guess the market is as well. Its not possible the government bans CPO exports for long, this presents unbelievable value if you are willing to stomach the jurisdiction risk