Member Info for sageoflondon

This could well go lower as could a lot of other things. The discount to NAV has widened considerably. Quite normal when a market is somewhat distressed with given non listed investments in the core portfolio.

The RNS is really badly worded - 4% of sales. £20m contribution to profit. I am assuming that is around £160m of sales. £20m of profit - is that gross profit, operating profit or net profit - if it's operating then that's quite an impact and it suggests we were earning more than a 12.5% operating profit margin on those sales, way ahead of our overall business - where our operating margin is just below 5%. I have no idea which? If it's contribution to GP - i.e. that business wasn't that profitable then it's unlikely to have much impact on the share price in isolation.

A nuclear war is less likely than the assets belonging to this FTSE 100 listed company being appropriated in retaliation for sanctions - after all the sanctions mean Russia will need more gold to trade with other partners. With a nuclear war not a lot will matter - other than whether you live far away from a strike.

I am not sure I really see a passport to a neutral nation doing much good unless you already live there. It takes roughly 20 minutes for an inter continental ballistic missile to reach the UK from Russia theoretically. It doesn't give you much time to pack a bag, get a taxi to Heathrow and get through the boarding gates, let alone get in the air.

At 100p I would have to have a gamble - but it would be just that, a complete gamble that the situation will not escalate further and the sanctions / restrictions tit for tat will not result in the appropriation of the assets / output. If you were Finance Minister in Russia would you allow Russian Gold mines to be used to pay for big dividends to shareholders based in a Nato country - that are essentially paid for by the Russian government - i.e. they will be buying most of the gold. Why pay for it?

They do have huge value yes - but it is looking more and more likely that those valuable assets will be appropriated. Russia will need as much gold as it can get it's hands on to support its economy and currency. The Russian Central bank has already ordered a block on any foreign citizen or entity selling Russian securities on the Russian stock exchange. I know this does not impact Poly, but it shows a clear direction of travel and things are only likely to escalate from here. It doesn't take a lot of escalation to say, just appropriate a few very valuable gold mines as they are required in the interests of national security. Most would not bad an eyelid - including the British government - plus there isn't a lot they could do anyway.

and if that were to happen do you think they would just give up their rights to the cash / value of the assets or would they have a friendly word with their leader - i.e. we would like our gold mines please.

Gold doesn't matter - take a look where Poly sells it's gold. 85% is sold to Russia! It's not about that. It's about what could potentially happen to the assets - it's that risk that is driving the price down, along with a good dose of uncertainty.

BP is also a strategic partner (doesn't stop the assets been taken away however) but it's probably less likely given Rosneft are partially reliant on BP for extraction etc - technology, know how, staffing etc.

BP has a 20% stake in Rosneft. So about $11bn I believe - out of a market capital of just over $100bn. So a tad over 10%. Poly has 8 of its 10 active operations in Russia. I am not sure on the percentage of sales etc. All of our development, evaluation and exploration opportunities are in Russia at present. I would hazard a guess that a lot more than 10% of value here is dependant upon the continued rights to mine the gold in those mines, probably a lot nearer 70-90%. I stand to be corrected if someone has a little more detail. BP will be compensated for that 10% with the increase in oil price in all likelihood.

I think the uncertainty will result in a gradual creep down barring any shocking delisting / appropriation news - either of those things won't happen overnight. They are only a possibility if sanctions cause operating issues - i.e. prevent capital flows for funding etc - i.e. the mines won't be allowed to be inoperative / go into decline, could also come into play if there is a drawn out upping of the ante and sanctions tighten and annoy those in power some tit for tat is expected, but Russia would pay a high price in terms of having access to London's capital markets severely restricted if it were to take that course of action. Bigger problem is funds and investors avoiding. Sales are very unlikely to be impacted.

I didn't expect it to go this far down, but what goes up can also come down quite rapidly as well. There just isn't any upwards catalyst for me. NAV increase pencilled in is old news. This is the price pre any potential full invasion and pre any larger market pullback in the US. It's a little concerning that it appears to be tracking technology that has yet to make a profit, which has been badly hit. I am guessing if you look at the analysis this is somewhat aligned to the Ark funds etc. That's a broad comparison in share price performance terms. Ark has probably decreased more, I would need to check this. I hope I am wrong in terms of further declines.

I don't think this is fully pricing in an invasion. This could easily move down another 100-200p on news that an actual invasion has commenced. It looks likely that it will go ahead, but who knows apart from the man himself. ps it was my understanding that the Ukraine gave up it's former Soviet Republic nuclear weapons for a Russian guarantee on it's territorial integrity....

Personally - I think it is 70/30 in favour of a full invasion happening. This will have an impact on share price. Even without full invasion we are facing considerable uncertainty - this could be maintained for a significant period of time and will significantly impact share price performance here.

If indeed those decreases are likely the market will be pricing that in already. It has moved beyond what we have been told is virtually definite. 20-30% discount on unlisted investments in the technology sector is also realistic, so market may not be expecting a big fall in NAV, just pricing in the risk for this type of investment. I am not saying for a minute this is Allied Minds, that was a terrible investment, that I never made. I have however said before that this investment will be very volatile. There aren't any cash producing portfolio companies paying dividends up to soften the blow.

Delisting is a possibility. I have no idea whether this could happen or not, or indeed what will happen next.

Anything can happen in war. If a number of Putin's close associates / companies / banks are sanctioned then there will likely be some reprisal. If you have some of the £5 billion of London property taken away from those individuals then no one really knows which way things will go. Why not just appropriate the gold and silver mines - after all Russia is purchasing most of the gold that Poly sells anyway.....why not have if for free - this would cause significant listing / capital raising problems in future but it is a possibility. No-one really knows at present.

We still had a very large holding so I can't imagine we got everything off at the IPO price even. I might be wrong. Before I am willing to commit more to this I want to see tangible evidence of a couple of real breakthroughs - i.e. companies that show real promise beyond sale or ipo. Most of what we have floated recently has flopped badly. Cazoo, Ui Path and Trustpilot. Hopefully that will change. My concern is that we have overpaid on a proportion of the subsequent rounds we have recently invested in as well. It's easy to hide when everyone else is investing at the same level. No one would even think to notice. This has downside risk as well - not just related to the market, but also related to actual performance of the portfolio - some of which is obviously related to broader market movements anyway.

You can see 76p because? What do you expect EPS to be? Just interested.

I work for an organisation in the city where staff bonuses are reasonably good etc. but we are very much run for our shareholders as well as our employees and our customers. If we didn't pay our employees at a similar level to our competitors we would not survive. It doesn't mean we don't make a very healthy return for our shareholders....

I certainly won't be adding here. Wrong time for me risk reward wise. I think this will likely overshoot on any big re-trace. If I saw this at £5 I might start to think about adding. It's teetering now on the £7 mark. All it will take is another Nasdaq 5%-10% fall. I am assuming we still have a fair Trustpilot holding - that really hasn't helped at all.