Member Info for SAGACITYRULES

Greeno - interesting piece of reporting, and extremely relevant to KMR. Are you able to reveal your sources? If it is your own work, excellent. Reading your report made me feel as if I was back on the Board and reading a board paper! Thank you.

Looks as if the storm has passed Moma by. Only thundery rain with slight breezes. Let us hope for the local peoples sake that this is the last of the exceptional weather.

One has to feel for the people of north Mozambique, especially the poor people in Pemba and surrounding districts. However, the storm surge is forecast up to 4 meters high south of Pemba. That may be a problem.

"Tempue est pecunia"! All correspondents addressing each other in a civil ised manner, thought I was reading the wrong Board!! But it is a welcome change and long may it continue.

I am looking for H2 and the annual financial results announcement. Is that due early next week?

In the paragraphs included in the Q3 Production Report, the stated dividend policy is stated to return a minimum (note "minimum")of 20% of Profit After Tax. That seems pretty clear. However, the following paragraph comments "In the light of the capital required for development projects.....the Company expects to pay modest (note "modest") dividends during the next two years".

Is there any clarification of the meaning of these comments?

Is it the intention that the dividends of 2019 and 2002 will be modestly above the 20% minimum or modestly below the minimum?

Excellent spot Earl.

Question : For every Buyer there is a Seller, any ideas who?

BF, so you are not Marky?

Your return will be appreciated by some and welcomed by others!

Congratulations on your first post Marky. You wouldn't have experienced a Lazerine moment by any chance?

His posts have certainly disappeared. He will be missed by friend and foe alike!

Agreed, very positive. Happy with that information.

Cap., I am not saying "sack the BOD". What I am saying is that there appears to be a substantial emphasis on mining and production without too much thought being directed towards selling price and therefore the return on investment. The company has assets of $700M plus. At a meagre 5%, this should yield a return of $35M. Given the nature of this enterprise and its location, a return of 20% might be expected, $140M. This would represent a realistic return on the value of the investment that is regularly muted. Look at the Board. All are individually worthy souls, I have little doubt. But which one has an eye to making sales at optimum selling prices and therefore is interested in generating profits over production? It is evident from past results that achieving sale prices in excess of or comparable to reasonable market expectations has not occurred. So why would it be expected that this lack of achievement will change when record production and shipments are your mantra? A sea change is required. The company needs to be led by a fresh mind who is profit orientated. It is currently moribund and stale. Some people have been in post for too long.

The City is not interested perhaps on account of the inability of the company to generate sufficient gross margin to put a large distance between their product selling prices and $130 per tonne processing/mining cost. Even BF is pegging his prices with very little margin. This makes the strategy unattractive and unexciting. Typical of situations where the company is led by a miner rather than a profit orientated entrepreneur. This is the history of the company in recent years. Record production, record shipments is all we hear. We never hear record sales prices.

A general meeting is a general meeting , whether extraordinary or annual. I am surprised that you did not know that!

BF - Thank you for drawing attention to my error of description. The reference should have been to "cost" not "profit". Generally, I think the conversation with regard to future dividends is encouraging, but a diversion. The important reality is that this company is grossly underperforming. It has in excess of $700M worth of assets and is only able to generate $19M of profit. My local building society is doing better than that and we pay the Directors a lot less than appears to be appropriate in Dublin. If it were not for the fact that such large tranches of shares were held by the larger shareholders, the company would be ripe for a take over. As it is, unless the larger shareholders crack the whip, or the BoD have a conscience, nothing is going to happen because the key director is too comfortable. He continues to manage an underperformance, but I am relieved that he was able to deliver a profit. This is not good enough. I know that I can always realise my investment and forget it. But, having been in here for a number of years, I want for the company to succeed. I want Ireland to succeed. The question is can this MD convince me that he is the man to do it? I hope that one of the principle shareholders might ask the same question and I would love to be a party to the answer that they arrive at.

The results are out. "Kenmare achieved record production and shipment volumes in 2017." So said the MD. Cash operating profit per tonne of finished product was down to $132 from �136. Safe to suggest that the operational staff did their job producing more and within cost parameters. Sales revenue went up from $141M. to $208M on tonnages only slightly increased from 1,024kt to 1,040kt. These extrapolate to $137.70 per tonne and $200.21 per tonne. Steady as she goes appears to cover it. Nothing startling, just solid progress. After tax profit of �19M with non operating and finance costs at a little under $12M has to be a target for future economies in addition to further increases in sales has to be the target. A return of $19M on a NAV of $796M is simply not good enough.

BF - I would have thought that even the tea money fund would be included. Cash is cash irrespective of where management consider they will eventually spend it. Liabilities and provisions for future liabilities would be shown elsewhere . The fact that a Company "earmarks" or designates part of their cash reserves to meet nominated future financial commitments, is irrelevant in that context. Earmarking amounts of cash reserves to one side to ensure their availability when required is simply sound financial management.

I suspect there may be some anomalies in the figures reported which bear further examination. It was anticipated by some that the net debt would have declined by amounts in excess of the $10.7M reported. However, this is but one figure from net assets and should not be considered as a great indication of profitability, or lack of it. Taken with the figures in the Finance Update, net debt has declined to $34.1M, a reduction of $14.7M. It is getting better! The production for 2017 totals 1,080,300 tonnes of finished product. Shipments totalled 1,040,400 tonnes. This indicates an increase in finished stock of 40,100 tonnes, adding say, $5.0M to the value of net assets. Additionally, during the final weeks it was reported that there was a substantial amount of activity dockside. This could indicate higher volume of shipments leading to higher values of trade debtors. The signs are that there is profit, if less than some expected. But at least the disasters of the doomsayers have seemingly been avoided. The question will be whether or not the profit return will be sufficient for the major shareholders or will they say "Enough is enough, let us find some other group of individuals to take this mediocre performing business forward?" My money would be on the latter as the management have not performed to expectations. A typical out-turn when miners run a mining company and not businessmen.

Changiboy - are you a reincarnation of some earlier poster on this board? I feel there has been a metamorphosis. Have I missed a profit warning from the management? If not, I would suggest that the current sp is still undervalued and eventually will rise within the next month, if only temporarily, before slipping back. Then comes the full year results and, who knows, other good news and maybe, just maybe, a sp that reflects the true value of this stock. Patience is the order of the day/week/month. I wish to thank all posters on this board who have given me many a chuckle over the year. A joyous and merry Christmas to all. I hope that 2018 will bring rewards to all.

Contango- many thanks. Nosi - even a broken clock tells the correct time twice a day.

Contango - Many thanks for your reply. I think one should ignore Nosi's comments, if only because they are unsupported by factual evidence. When you say that "We had a decent volume for a week or two" are you referring to production /sales volumes or share transactions? Thank you for your response, very much appreciated.