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You also don’t appoint a new CEO and his first job is to announce bad news. Ask yourself why they are announcing today with SWAG imminent. If Scallywag was bad news GH would have announced and then stepped down in my view.
This move had to happen. If you trust in GH then trust this is the right decision.
Everybody needs to watch the PROACTIVE interview as it says it all.
Gervaise himself in that interview says he is not the best person to grow the assets or the company. Shaun had a proven track record of mining and overseeing growth on a scale every single shareholder wants to see.
This is planned move by GGP. It is also very well timed and has nothing to do with SWAG.
I think the board are now expecting a takeover approach in 2021 and they now have an experienced person in Shaun to maximise value of that event happens.
Sprouts - your approach is an interesting one and not necessarily wrong. GGP are set up to be a silent partner through the existing processing plant so looking at multinational gold producers with their infrastructure and overheads plus evaluating their resources lifecycle is probably not directly comparable.
At the moment GGP are effectively heading for silent minority stakeholder on one 15m oz mine, using an established plant which reduces cost in a safe mining jurisdiction.
Every dollar above c$800 oz costs is profit. At 500,000 oz per annum x $1000 profit at Today’s prices equates to c £130M GGP profit per annum on the gold alone. That for 30 years adds up to a big number.
Sprouts - you mentioned in your 11 Dec post that your valuation method is 10 years old. 10 years ago when the gold price was $500 an oz then your price for gold in the ground is probably about right. The GP is currently $1800 and forcast to rise significantly so using a figure of $500 to $800 an oz in the ground may be more realistic.
I think this is why the brokers will revalue this as an unrisked resource periodically through 2021 and if we hit 15m oz which is possible the valuation may well hit £1 a share.
You also shouldn’t afford zero value to the other assets. BB stated £400m in value to hothead although I personally think that was a little bullish.
I gave an example in my last post regarding the dilution Allstar. I’m not saying you can’t appoint a Board with no stock interest. I’m just saying I don’t feel comfortable being invested in one where I have more to lose than the CEO if it all goes wrong.
By your logic you might argue why bother having a board at all if the golds just in the ground. If your saying the gold is what will drive the share price then I agree with you on that point. That is also why the timing of today’s RNS is good news. It clears the path for value adding announcements next week and beyond.
If your invested, good luck for a blue day.
Allstar - Call me old fashioned but the Board need to be aligned to shareholders. When they diluted 2 weeks ago that decision cost the Board nothing. It cost shareholders 30% of the value of their holding. If he does it again it hits him in his pocket.
Whether he pays for the shares or not is irrelevant from my perspective.
Whether the market notices the RNS or not is another matter. Good luck all.
All star - you ever had a bonus target at work? If someone said be succesful, secure shareholder upside from $0.32 and the Board will receive any upside multiplied by 5.6M that would make me pretty motivated to succeed.
His buy in yesterday is an investment which can go up and down and whilst it would have been great to see £100k go down as a mark of confidence the Board now have a 3% stake in the company.
All Boards have success related pay deals.
In his defence Imp2 it was 4am when he addressed the UK audience. It looked more like an outhouse than a basement - I am imagining him getting an ear bashing from the missus about doing it in the house and waking up the kids!
This is definitely a hold if your in or a buy if your not. Fundamentals haven’t changed since 46p so when interest in the stock returns this will rise.
One other event that could unexpectedly drive the price is EUA sale. The will be a lot of risk taking confident PI’s looking to buy into good undervalued gold/PM stocks and given their sale price could be £2Bn it would only take 5% of that money to generate £100m of buying pressure!
It’s worth reflecting that the MRE is a watershed moment for GGP and for many long term investors who have benefitted from the rise this is an obvious point to lock in profit.
I also think this marks the point where new investors will feel it is right to buy in, especially institutional investors and funds.
A drop today in that context is very understandable and I would be very surprised if we haven’t set a new SP high over the next week or so.
Fantastic opportunity here for predictable news flows driving value in the company.
Perhaps I am being to harsh on him. My issue is more with the company failing to issue a share option package which to be fair may be coming at some point.
My normal investing criteria would include a CEO with more like a 3%+ skin in the game.
I’ll accept his good intentions and wish him and board lots of luck with the drilling campaign. That is what will really move the dial.
No Mrdigit, if the CEO is looking to send a message that this is his first chance to buy into his new company and we are sat on a tier 1 gold mine then the market optics are not great.
If we saw a £100k buy or 500,000 shares then ok, but £10k worth. Not great in my view.
I cast no dispersions on Brad, it is coming up to Christmas and we could all do with a few extra pounds to pay the bills but this in my view raises more questions than answers about his confidence in the company....
He bought 10k GBP worth. Well I am a shareholder and my first inclination is to dump my stock if that’s the level of confidence shown by the Board.
I hope the market just reads the headline and doesn’t spot the buy level.