Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
The CCP would like to be able to control the wold price for thermal coal, but they can’t. If prices stay high they will open more mines but developing countries have fast growing populations and fast growing electricity demand therefore the work wide demand for thermal coal may outstrip any new coal output. China will be buying coal for many many years to come.
July’s tone of voice suggested to me the relaxed confidence of someone who knows that the figures so far for this FY are very very very good, and that he is also confident that the company has a long and profitable future.
Thungela shares mispriced say Citi
https://www.miningmx.com/top-story/47727-sa-coal-miners-to-make-good-money-for-10-years-despite-freight-opportunity-cost/
This is not a ‘normal’ market as there has been a lot of political interference to try and bring about the elimination of coal - but this is impossible in the timescales being attempted and impossible without a massive worldwide investment in alternatives - hence this car crash of an energy crisis which is still in its very early stages. We’re not even properly into winter yet!
All that really matters is that TGR keeps selling coal and there is a good market for coal, prices are still going up and it’s not clear where they’re going to stop given the world wide energy crunch.
https://www.barchart.com/futures/quotes/LQV21/futures-prices
But the ap14 coal drive went up by 5% aprox for the 3 months up to the end of this reporting year. My rough estimate, which may be wrong of course, would be that the company should have £125 mill fcf per month if those prices are maintained - and who knows, they could move up significantly given what’s going on in China and India. So that would be £375 mill on top of the profits earned to date. I could be way out on this off course.
https://www.barchart.com/futures/quotes/IFFF22/futures-prices
The CCP has made a bad situation worse and worse is yet to come.
China hit by power cuts and factory closures as energy crisis bites
https://www.theguardian.com/world/2021/sep/29/china-hit-by-power-cuts-and-factory-closures-as-energy-crisis-bites?CMP=Share_iOSApp_Other
This is assuming only 30% of cash flow is distributed which is a minimum figure. Why would the company want to have zillions in the bank over and about a sensible buffer to get them through a bad dip in the coal price?
https://www.fool.com.au/2021/09/21/new-hope-asxnhc-share-price-jumps-on-337m-profit-turnaround/
The price of South African coal has edged up today, so nothing wrong with the fundamentals.
https://www.barchart.com/futures/quotes/IFFF22/futures-prices