Member Info for the_shareminator

Hi Brozie, I think you're getting confused

KEFI shares are referred to as 1.7p shares, you can see reference of this in the last set of Interims were it states

"Consolidation of ordinary shares during 2017

Following the Company's General Meeting on 1 March 2017, at the close of business on 1 March 2017 shareholders received one Ordinary Share of nominal value 1.7 pence each for every 17 Existing ordinary Shares of nominal value 0.1 pence each."

The funding update states the lender has the option to convert half of any repayment at 2p per share, not 1.7p which means if there is to be dilution it will be at a higher share price than the one you are assuming. They likely won't convert at a loss In addition KEFI are sat 33% off the 2p level now which may give an idea of where this is heading in the next 12 months.

Shares to be issued for the £2 million loan
- 50,000,000 Shares to the Lender assuming they choose to convert half of the loan repayment (£1 million)
- 12,000,000 Shares to the Lender (in lieu of interest)
- 5,000,000 shares in total in the form of a 5% fee of any amounts drawn payable in shares at 2p. If the share price is higher, then it is fewer shares, this is worst case

That's 67 million shares.

There is an Option Fee of 5% for the right to trigger a £2 million Optional Second Facility which is basically another 5,000,000 shares again at 2p per share in addition to the shares issued as above but it's not clear if they need access to this.

The lender does NOT have the option to convert ALL their shares, that is only in the event KEFI do not make their repayment.

The lender does have the option to convert half of the amount into shares at 2p and any remaining amount that hasn't already been repaid but presumably after the 12 months expire.

Assuming KEFI make no repayment in 2019 then yes 117 million shares are issued at 2p per share to cover the £2 million loan. 20% of the company right now is worth £1.6m so you could buy today at 25% discount to what the lender is paying (again assuming they end up with 117 million shares).

The results were the only treat I consumed yesterday Ragnar, how about you?

I had thought the operational performance would be better following on from comments in the previous quarter, chiefly "After the record monthly production achieved during March 2018, the SDO continued to build on the strong performance and again delivered new consecutive production records". In May production climbed to 6,650 ounces and in June to 7,400 ounces. This contributed to the record quarterly production figure of 20,278 ounces so that may be why shares have not climbed back above 20p.

It was impressive then that SDO cash costs rose just 2% to ZAR 7,137 per ounce considering the drop in production. In USD terms cash costs continued to fall although I think we are approaching a crossroads now. I expect cash costs will be around the $480 level next quarter assuming higher production and a stable exchange.

mudeye - nobody is getting reserves and resources confused, let's be clear. That's why I listed them separately instead of referring to the 2.7-2.8 million ounce combined resource.

Far too many negative nannies here. The share price has collapsed because cash-flow is tighter owing to the events in the previous quarter. That in no way changes the longer term picture whereby a significant portion of the 1.8Moz of gold resource and additional 390,700oz of non-compliant exploration potential can be better defined and brought into the mine plan, extending the life of mine. If you're worried that HUM will not be able to fund exploration cost to prove up additional ounces in the next five years then yes, you shouldn't be invested here. Somehow I think most of the downers (not you mudeye) understand the likelihood of extending the mine life and are just looking for the opportune price.

This will probably be sold for no more than 30p in the next year or so given it's distressed state is a short term issue that once rectified will see the company value rerate before long.

Happy Halloween! Quarterly results out today :)

Yep nothing scary in there, net profit barely fell, cash build of $3.7m and a very thorough breakdown of the 4E and 6E costs. Likely this quarter will set a new production record or possibly come very close to the 20,278 ounces (Q418).

Interesting to read net interest rose 3-fold to $180,000 which suggests they have more cash sitting in interest-bearing account(s). I may be wrong but at 7% annual return, a jump to $180,000 this quarter suggests they had around $10,300,000 on average sitting there untouched.

"The surplus cash held and invested in ZAR earned interest at an average rate of 7%. This cash will be used to fund the balance of Project Echo and other production optimisation projects. The increase in cash invested resulted in an increase in the net interest earned for the quarter."

It could be ODEY, the institutional investor who sold down recently. Dropping below the threshold as announced a few weeks ago, I am not 100% sure they need to declare any outstanding holding which might explain the comments in the update they have been invested for a while despite their last entry holding being 0.0%.

If it is ODEY it makes sense for them to derisk in anticipation of securing this deal at a lower share price and strengthens their hand going into the negotiation (with the share price suffering). They would have known for a while as this funding isn't the kind that is organised overnight.

Then again I may be way off the mark and it turns out to be someone else like Blackrock lol

If they choose to convert their loan to shares in Q119 that will take them over the threshold for sure

Managed to buy a decent sum of shares today and really happy paying a little more than 18.5p a share when the stock was trading around 26p just last week!

I read a post earlier that said HUM has 5 years of reserves left which is simply not true. They are looking at producing at a rate averaging 100-110koz per year. The Yanfolila Probable Reserves comprised 709,800oz @ 3.14g/t back in December 2017 I believe but the company also has access to total Resources of 1.8Moz of gold and an additional 390,700oz of non-compliant exploration potential.

Short term, I would hope management conserve cash to see us through this uncertain period. A clear statement in that regard would probably add support to the share price from here.

- place a temporary halt on the development of the second ball mill until heavy equipment is able to cross the bridge and complete any remediation work needed.

- limit the ongoing exploration work for a quarter or two until the inventory has been reduced and net debt brought lower

- take steps to secure financing options in the event sales this quarter are significantly impacted

Looks like another one for the scrap heap. People jumping in now doing so based on other company issued figures. Credibility zero. Likely going to be a backlash. Expect further negative sentiment. Good luck to the gamblers!

Precious metals miner Fresnillo has cut its guidance for silver production this year for a second time.

It has reported lower-than-expected production for the metal in the third quarter, mainly because of lower-than-expected ore grades at two of its mines.

The company said it was trimming its output guidance to between 62 million ounces and 64.5 million ounces from a range of 64.5 million to 67.5 million earlier.

Are we there yet?

Amazing we are trading so close to the tender offer. Can only attribute that conundrum to the state of the markets today.

Wider market is taking big hits today, no real reason other than market jitters. Gold price is up to $1240 as a result.

I think diesel demand is down and will continue falling. Nothing has changed in recent months to suggest this trend will reverse. It does make sense to switch to platinum and the time to plan for this was a couple years back when us lot when contemplating it but I wonder if such moves are as easy as others say. It wouldn't happen overnight so at least for now demand for palladium will remain tight.

Let's remind ourselves Norilsk cornered the market back in 2016 I believe and have been buying at spot prices ever since. Any significant movements in the price of palladium are probably related to their ability to influence the price. The Russians do have a monopoly in this market with more than two-fifths of global supply originating from Russia.

At the same time the US has I believe threatened to impose sanctions on Norilsk! Can you imagine the chaos that would ensue if that came about. Taking the largest palladium and fourth largest rhodium producer out of the equation, where are new palladium ounces to be sourced? To put it into context they are expected to produce 2.6-2.7 million troy ounces of palladium this year and will likely be buying at market prices to help facilitate supplies. The market is already in physical deficit for the last decade and a shortfall forecast through to the next year.

Oleg Deripaska who owns about 25% of Norilsk is on the US sanctions list as of earlier this year. He jointly controls the group with another Russian oligarch Vladimir Potanin (33%). In February they reportedly had a 'bust-up' over control of the group which sent the shares down 33%.

In a research note earlier this year JP Morgan Cazenov wrote Potanin was named in the US’s Section 241 Office of Foreign Assets Control (OFAC) so “implying heightened risk of sanctions being imposed at some point."

“If Mr Potanin were to be added to the Specially Designated Nationals (SDN) list, under the “50% rule” Norilsk would also become a sanctioned entity which would likely have significant negative implications for the share price.”

palladium just broke $1100

next quarterly update due in less than a week

30p by Christmas

ho ho ho!

Little top up before the weekend, oil is heading higher again and it's only 535p a share!

bountyhunter to be fair it can be interpreted that way and you're probably right! Some of the wording is pretty obscure but it does seem like ANS has the option to increase this up to $38m rather than an additional third subscription. Must read it properly next time lol

Upon initial reading, results are about what the market was expecting. Obviously gold sales at $1206 are a sore point but operationally speaking, the average grade was up on last quarter and the previous. I expect if that continues into the fourth quarter they could exceed upper estimates of 275koz for the year. If the price of gold remains at this level then I think we may see a dip into the 130s again. GLA

RB I had suggested previously debt would be cleared within 2 years but shrinking margins and a reduction to 2018 production guidance reads poorly. Perhaps the market was expecting that. I am somewhat surprised this hasn't fallen further given the current climate. Net debt fell to US$35.1 m (Q2: US$38.1 m).

Just to correct my earlier misgivings about AAU's recent site visit, it has since stirred the share price forward. Well done if you jumped in on that dip below 1.2

Looks like a runaround. Could they not simply dual list?

I suspect people are selling for the mere mention of "Brexit Contingency Planning" being the title of the update. Any talk of BREXIT is a negative as the situation is not fully clear. So I'd expect further downward pressure regardless of business performance in the near term.

120-130p range

No problem, it's good to read something new and I'm glad we are on similar wavelengths.

You did well getting out of KRS. I held for a time but I'm too impatient and seeing Calidus drift made me nervous. It's even cheaper these days but probably best to leave it.

I left a post on the AAZ board detailing precious metal stocks I'm confident holding and dabbling with. Sometimes the share price continues on after a sell but recently both SLP and AAZ provided a gift at 16.13 and 63.5 respectively. I expect both stocks to move up even if Au, Ag, Pt, Pd drift. Then there's a 10% annual dividend with improving profits and outlook for TSG. The more liquid option would be to trade HGM for Russian gold and high dividend exposure.

I'd be interested to hear what your strategies are in the current low gold environment and whether you think it's about to trend higher

AAZ - Gold, silver (maiden dividend, already ex-div) and ramping up with H2 production expected to be higher
SLP - Rhodium, palladium, platinum (maiden dividend, 18th Oct ex-div) with higher margins in recent months
TSG - Gold, silver (already ex-div), H2 production ramping up, costs lower as grades are expected to improve
BMN - Vanadium exposure
HUM - Gold play, looks like it has more risk / reward, quarterly update next week, net debt reducing, ramp up continues

HGM, FRES, HOC, CEY cyclical dividend and sector exposure

SHG and AAU have medium term potential, the former continues to pay down debts, the latter is yet to benefit from cashflow as it's subsidiary is still repaying a loan.