Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
My conservative estimate would be to take the £376m fully current gross loans at 31/21/. Assume the £30m a month collections is likely coming from this portfolio so that reduces this to £200 approx and add half a years accrued interest at 49.99% brings this back up to £300m. I think the balance of 126m (502-376) is provided to £90m so has a net value of circa £30M, so my estimate £300-330m as the current net book value or £300M on the current book. However the total book has an estimated claim liability on it of £150M. If I was buying the book I would be worried about exactly quantifying this which I think near impossible and so I would want a really high return to take this risk. So £300m NBV take off £150m(estimate) and I would want 100% return on my money so maybe £75M, more realistic £50m. This is why it is so important that the best deal is Amigo keeps running and EVERYONE realises there is no value for unsecured claims or shareholders unless this happens. My estimated £50M plus the £180m cash gets the secured out but that's it.
Anybody who says they could do that and wanted to charge you is lying. The latest information anyone has is 31/12/20 and we are now in June and so it is impossible. Totally impossible. Even if you assume £30M of collections a month you don't know which category of loan the collections are on and then you have the problem of factoring in the secritised loans where we know all cashflow goes to those lenders until the senior debt paid and we don't know what amount of loans collateralises this facility. Its just not possible to do a current market valuation without a cashflow data file on each loan to the sum of the current gross loans outstanding. Keep your money, it would be a total waste of time
There is NO STAGE 4 under IFRS, stage 3 is the delinquent category. They put everything past 61 days in same bucket at 44M and tell you stage 3 is 39 so a little bit of maths gives you an estimate of the 61-90 days. No, definitely not Prime books, 100%. I traded US stocks in 2008 and a lot of people thought the financial system was going to collapse and everyone was scrambling for liquidity but there were no such sales. There is absolutely no way Metro sold a prime book at those discounts. The gross margin on prime mortgages is 1-1.25% and this only works because they are 20% weighted for capital purposes. A bank selling a prime book at such discounts would have to re-build a similar size portfolio and wait 20 years just to recover that level of loss. Thats ridiculous.
The impairment provision is 18% as at 31/12 (90/502). Write off are taken against prov account it is NOT a write-off/provision account, it is just a prov account. Its not going up 15% per Q that is total rubbish. With little new lending I dont expect this to be a material factor.
Prime mortgages are not sold at 20-25% discounts. Prime books are securitised not sold as they are so capital efficient for banks. Only impaired books are sold and they are sold because they are capital inefficient to hold. You write this stuff with such authority but it is plain to me you dont really understand what you are writing. To someone who understands fin accounts and the markets in general it is very obvious, you should not be writing this stuff, its plain wrong
Thats what interest on late payment compensates for. If they dont have the cash at a particular point in time then they dont have it. Remember they made the 15% commitment on accounting profit that is not the same as cash profit, big difference due to accrual accounting.
The FACT that should have been made is avoiding Insolvency is not Amigo's decision to make when they are on temporary waivers. Its not the FCAs job or the HC either to say what a secured lender will or will not decide to do. This aspect was glossed over like it didn't exist. Dicker should have been tied, I agree, to a tree somewhere and should never have been anywhere near the Court
This 10p in the £ argument used in Court was also a load of crap and showed me how incompetent Dicker was. The 10p was on the basis of the £15m upfront cash and gave no recognition of the 4 years of 15% of profits and much more importantly Amigo's commitment to resize the balance of the loan if that was an appropriate remedy. They have already taken a £150m provision for this type of exercise. but because Dicker knew Dicks..t about the accounts he didnt even refute the totally ridiculous calculation by the FCA and the judge knew less. The SOA1 deal was much more than 10p in the £ but the incompetence of the Amigo side was staggering. A scandal. I don't trust any of them, all incompetent fools running around like headless chickens
I don't think Amigo should negotiate with the FCA. They have shown themselves to not be worthy of trust and while I know they reserved their right to change their mind there was a long consultation time on SOA1 and to act the way they did was unprofessional and discourteous to everyone. Just offer the 15% of profits till all claims met with interest on any payments made after year 4 and move on. I would not believe a thing they said if I was negotiating with them and so it would be a pointless exercise.
They have played that card as demonstrated by the chart you keep referencing and which shows they get to £234M in jan 2024, JUST. They cant now say, oh we were only joking, trying it on a bit, dont worry there is loads of cash for everyone. That horse has well and truly left the stable and you know what I think the soon to be released results will show they have probably been too optimistic as you think the securitisation facility has been fully repaid by june but I think still £50-60m left to go based on my £10m a month repayment schedule.
I dont make deceisons on Hope value. The fact of the matter is the Secured lenders are in control here and they care about one thing only, getting repaid in full. The Judgement of the HC, Supreme court or the Queen herself matter little to them and they certainly dont care if some Judge is offended because he feels the sword of Damocles swiping past the side of his cheek.