Hi if Ilja doesn’t know does any one have a rough idea of how much we depend on Chromium and how much PGM’s for profit, I know it is hard to apportion costs but we divide the PGM’s into rh ir etc percentages. Would it be around 50/50 - obviously will have changed with PGM one third price fall presumable more than halving that side of profits while chromium has risen both in selling price and quantity now? Thanks I only want ball park
slater it is great you have joined this board as it was really dead, sometime with a week going by without a post usually by me or Dark Knight and an occasional impecunious or Tornado or other visitor. Now it is jumping which augers well. You may be right on Hoc trajectory as profits fall with long in the tooth mines and politics worsens,however you are wrong on gold only being an inflation hedge in the very long term. In the U.K., where inflation takes account of rise in the dollar that you mention we also spend in, these are the approx gold prices that seem to have beaten inflation in every recent period. Up around 15% on a year, 50% of 3 or 4 years, so maybe has beaten inflation a bit too much m needs a pause. Just now, in times of stock market falls gold is an easy sell as investors need fast liquidity, but although it may fall further it should then catch up with inflation. It has beaten it in every period below this week £1500 6months £1400 1 year £1320 2 year £1300 3 year £1050 4 year £950
pkumar gold had fallen too fast, I posted on the hoc board testerday that it is time for a bounce that could even last a week or two, then on down, so I think you have done well but I would take profit fairly quickly
I have never mentioned the 19th century, suits or antiquity, I talk about sterling gold as that counts for U.K. quoted PM miner profits, sterling inflation isn’t rising faster than dollar inflation so therefore ifliving in Britain as I do and taking dividends in sterling, it is sterling that counts. Gold is up over 10% in 3 months, 10% in 6 months, 15% in a year, and 50% since 2019 before Covid, nothing to do with 19th century. Slater I respected your posts till you tried cheap and false insults rather than intelligent argument, shame as I had though you had a point.
indeed so prof, as I posted on Hoc board this morning, gold for these sterling quoted miners should always be considered in sterling. However our sterling costs have risen so fast they are probably now £1250 or more per ounce compare to £600m not so long ago, which just leaves somewhere a bit over £200 an ounce profit, or £100 after profit share and royalty which on our paltry production is now not must more than £40m and falling, compared to $153m last year and $315m the year before, so our share price deserves to be quite a bit lower and is only holding up in the hope the mine gets costs back down, but that aint so easy now. imho
Ilja, with the lower basket price and increasing chromium production and price very roughly what proportion of profit do you think comes from PGM's and what from chromium - I do understand it is hard to apportion costs but just a v rough ball park, thanks
RE: Silver futures daily RSI hits 1912 May 2022 18:10
yes miners and Hoc in particular are definitely oversold and due a nice big deceptive bounce. I hope Slater tells us when he sells those he has bought with his grandma's piggy bank, and gives her more laudanum to return the profits. I reckon a couple of weeks before the tumble accelerates?
Yes Saab though actually the hedge price went down a dollar from last year to this and it’s going down another dollar next year, however the important point you make is that we are now primarily a gold producer and gold is up over two months and up over 10% in six months, overall rising faster than inflation in sterling that matters to our profit (Slater take note). I don’t believe the market is aware of this as like Slater still thinking of gold in dollars and that we were primarily a silver miner. So our profits should not be affected much by the fall being only 20% exposed to silver, however the politics in Peru is another matter!
Sadly deepjoy at the moment for every bull there are a handful of bears, hence the falling market, who knows where PM’s will go but given their inability to rise looks likely the fall will continue imho. Yes gold has kept pace with inflation in the very long term, the problem is that we won’t live for the very long term. The big immediate problem for us, as Slater has pointed out, is that mining inflation has far outstripped the real price of gold recently, squishing profits, and Hoc has such high political risk according to its latest statement. At least they now seem prescient to have hedged a third of their silver at if I remember at $26 this year and $25 next.
Steve although gold may be up 45% in last 5 years profits are down as costs have gone up by over 60%, plus profit share and royalty now take 52.5% off that reduced profit, so that is why share price is near lowest especially as currently looks like future will be bad as gold price worsens, amazed it has held up so well!
As usual it should drop the amount of the dividend less the rise or fall of the day. However this si small beer compared to how gold miners have been crumbling in expectation of lower gold prices and much lower profits. Centamin’s profits will be around a third down on gold at $2000, so the share price has held up remarkably well making it more vulnerable; another 10% fall could knock a further 50% off profits and could take us back below 50p. So the big question is not what will happen on divi day which is pretty immaterial, but how far the gold crash will extend. imho
Viz your question about the reasons for the fall over the last couple of weeks see my post over on advfn 3 weeks ago:about how reduced Chinese car production would reduce PGM prices and again, after no replies two weeks ago, that it was already hitting prices hard and would hit harder. Well the basket price is down about 25% from its recent top reducing our PGM profits by maybe 50%, and down 10% in just the last fortnight which should knock at least 20% off profits and the shares.. With rising worldwide rising interest rates, and looming recessions, I see real PGM prices continuing to trend lower. Luckily we were relatively cheap before these falls and so far chromium is actually still rising. But the fall of the last fortnight to my mind is entirely fair and not at all overdone yet….most sadly. However I continue to hold as good value, good dividend and good growth prospects and where else do you find those?
RE: Silver Paper Contracts shortage25 Apr 2022 09:56
Certainly the report last week presaged horrid political risks both locally and nationally, with poor Peruvians becoming bellicose about the great inflation, which is presumably also affecting Hoc costs which are already too high?
Basket back below $3000 so I am only surprised this hasn’t come back further and faster, with China auto production cutbacks and more important the coming world recession with the high interest rates and inflation, that will presumably reduce auto demand. Surprisingly chromium isn’t down much from March, yet, so maybe holding us up, but reality seems to be dawning today.
Yes in this Horgan is indeed bullish about the future, in true Centamin tradition, but then makes one question this by his Panglossian interpretation of this last quarter just gone, his final words “this has been a hugely successful and very satisfying quarter,”. Well if that is his idea of huge success what misery does he mean by the medium success he expects in the future?? However despite Pardy and Horgan I remain optimistic as long as gold holds and someone is tempted to buy us, saving us from these second raters who just won’t communicate to us owners as it is, as Cowichan keeps banging on about