Member Info for Tornadotony

Gold in the ground without a mine has a balance sheet value. Inferred ounce are valued at $10 per ounce. Indicated resources in Africa are typically $30 an ounce and can be valued at $40 if infrastructure and utilities can be partly utilised or extended for use at the mine. Reserves at good grades are valued at $100 per ounce.

Shanta has returned 0.5p in dividends over 3 years. The purchasing power of sterling in that time has fallen 25% which Shanta is priced in. The Gold price has maintained its value against sterling which is the end product produced by Shanta Gold. The company also produces per annum 26% more gold output. The cost base has increased by around 20%. The share price has devalued 35%. The company paid off all its debts just as it did 3 year ago and did build up $25M cash profit, but it had no second operating mine. It also had 1M less indicated resource ounces of gold that has an added value of $20M in the ground.

The reserve ounces also mined out in Tanzania in the last 3 years were all replaced within Tanzania that is separate to the additional resource data.. No matter how anybody looks at this, Shanta is chronically undervalued and Eric demonstrated this in his earlier quarterly presentations. The company overall has grown in 3 years and the valuation is down 35%. The divis of 0.5p (5% of company value on its SP) may have covered some past cash flow growth and that is about it. At the present time it should be around 13.5 to 14p at the lowest pricing.

The gold price on spot is around $8 down the average since 1 January that has less than 1% impact on Shanta earnings yet the share has recently been devalued 10.5%. Centamin is similarly devalued 12% against the in year gold price. This implies that $1830 per ounce gold price is priced in for the average for the entire 2023 year. So far average sales price is around $1935 an ounce. So to get to $1830 a year average the next 5 months would need gold prices around $1700 per ounce or below every day to 2024.

If one argues that the PE rates of equities need to decline to keep with 4% Treasuries it would mean a doubling of Shanta's dividend to deliver equal value in returns. Shanta could easily do this in 2024. In fact it could deliver 0.6p dividend and support a 15p share price and would still have £20M in cash although some might get spent on resource to reserve gold ounces. In my opinion, the increased in Treasuries argument falls on a gold price above $1800 per ounce.

Anyway we can only wait and see what happens. Bloomberg reported this morning that the entire Italian stock market is on 7.8 PE rate on forward earnings and it is the lowest in 17 years. The Italian stock market has some good companies with bombed out valuations against earnings. The opposite applies in USA at 54x future earnings.

I thought we would get a rally this month as FED had no meeting. Clearly it has gone wrong on my prediction. At some point the reality has to square up in the market. I have enjoyed a good run in getting the trends right since last October. Hopefully Centamin will catch a decent rally again later in the year. It is undervalued at the current gold price imop. Gold companies are not getting any credit for coping with inflation with cost reductions and increased production and recovering mined out reserves. No credit for carbon reduction on the gold ounces delivered either.

Noel

I am mystified that after a ratings agency downgrade on USA bonds for very good reasons, the market decides that a country that is losing confidence in its bond rating goes up in value. Additional the Treasury bonds it sells today were offered at reduced interest than yesterday although flooded onto the market and gold which normally goes up when yields reduce goes down. Some people feel the only buyer of USA Treasuries in a round about way is the FED back stopping the deal with future money printing. Everything is upside down. Overvalued equities become more overvalued and those with very low PE rates and are undervalued become more undervalued. Nothing makes any sense.

I have noticed however that bonds today have got a lower bid on the USA Treasuries and yet gold has gone down.

Japanese USA Treasury holders are currently selling now that the Japanese central bank is allowing yen bond yields to rise which is pulling in the Japanese public to buy its bonds. China may also be dumping some USA Treasuries which suggest the bond yields may go higher. With QT on top it looks as if a mess is building up in the USA stock markets. Biden in the meantime needs more USA treasuries sold to deliver all his Inflation Act programmes. At the current time this looks bad for gold if USA Treasuries offer higher and higher attractive long term rates. However, this amplifies over valuation of USA equity markets that may well have a waterfall hard landing. The subsequent recessionary hit is likely to leave gold the cleanest shirt around ( take on Yellen comments) as all the others will be in shreds. Having gold in the core of investment therefore makes a lot of sense.

Interesting that insurance statistics reveal a lot of individuals were made ill by the Covid-19 vaccine programme in USA and this has led to both significant number of deaths in 2021 and 2022 along with significant numbers of disabilities and is contributing to numbers out of the workforce and unlikely to come back in USA. It is likely to be a factor in keeping inflation high in certain areas such as healthcare.

Shanta Gold was following the commodity gold price for quite some until the Odey sell off happened. The share price never recovered back to the previous relationship with the gold price. The only difference being that others now all hold those Odey shares and have been denied the previous equivalent relationship that existed with the gold price. The disparity on the chart is an entire penny. So in fact today the share price should be 11.0 to 11.1p on a 1930's gold price for Odey impact alone. This is allowing nothing additional on having confirmation of Singida production for 2023 and arrival of good Q2 results. The market has punished share holders of Shanta gold for having Odey owning those shares in the first place. It is an act of collective punishment on all the other shareholders of the company. Other companies affected by Odey selling recovered all the impacts on their share price. This has only been applied to Shanta Gold from what I can see. This issue has annoyed me more than anything else as it a failure of upholding fairness.

The FT lists 290.17M shares held by various institutions declared in July 2023.

The following additional holders to the above are:

Statens Pension Fund 32.3M

Vanguard Total International 15M

Franklin Gold Fund 13.2M

Premier Miton 12.1M

Halifax UK Growth 11.1M

Ninety One GSF Global 11M

Ninety One GG Fund 8M

Man GLG income 8.7M

DFA UK 8.1M

Hartford International 8M

Global Value Fund 7.9M

Shroeder 7.3M

Ishare Core 7.1M

Nuveen 4.5M (3.34M declared purchase being in Q2)

The above is another 154M shares.

In addition ETF weightings have also increased for Centamin that involve many millions of shares outside of the list above.

Centamin has a huge diversification of holders. I have not included nominee accounts such as Hargreaves and Lansdowne and many others.

The key takeaway is the company had completed all what they could do under their control on the validation work. The internal processes of another company may be impacted by other events outside of all the research work. The work may also be under an internal peer review. The outcome is a potential batch production for larger scale evaluation studies if it has worked out well. If the material is incorporated into complex devices, other components not produced by Nanoco may be involved. The supply chain may be more complex in some cases. Overall it is hopeful/ consolidation rather than bad news.

6 analysts have raised Centamin earnings forecasts in the last 30 days. (1 was raised a week ago). 4 analysts have raised earnings for 2024. The increases are 50% higher per share than in 2022. It appears only 1 analyst has earnings may be lower in 2024.

Centamin book value has declined 10% in the past six weeks. It now trades 1 times book value. It usually trades above 1.1 historically since 2019 although a low of 0.76 was reached in 2022. Not one analyst has given Centamin a sell rating at this current time when quite often one or more could be found.

The SP performance is now 43% lower than the mean of analyst forecasts and this has sharply widened over recent months. In the past, Centamin performance was either below analyst forecasts (10-15%) or actually as they predicted as was the case pre-2020. This of course may relate to what analysts may also think on future gold prices in the coming months.

Tony

Already 35% plus into Q3 with another month of good spot prices around $1940 average per ounce and low AISC. Company is surely out of debt by now and starting to build up a cash balance. We still have not recovered from the Odey sell off. Drilling results from WK also expected soon. Another tailwind is a falling pound as forecast by Bloomberg this morning.

I agree the process has to have the appointee all cleared to accept any position. Hopefully it is at that stage by now in that the Board knows who they want in that role.

The Board needs to notify us of their deliberations on who will succeed Eric. They should not leave things to the last minute. It takes time for a new applicant or someone existing in the company already to prepare for that role.

23 trades in the whole day. It confirms that Pensana is getting the same treatment as most other stocks in August 9low volume). When a share price goes down on large volumes is a concerning signal. When it goes down on tiny volumes it means little and this applies to most equity stock. God knows what market makers are doing. Perhaps they want to retest the support line at 24p and trying to get more stock to buy and sell higher up. I predicted that the share would get close to 27p and it did so. I also said it could touch back to 24p. Without news it only takes a few buys and it goes back to 27p again and it has. The amount of shares held by the market maker is probably low and hence the big difference between ask and bid prices. The moves between 24-27p are mainly consolidation until news arrives and the market maker is just showing the share has a pulse and not flat lining.

5 years

1. Shanta Gold ShG

2. Anglo Asia AAZ

3. Endeavour Mining EDV

4. Centamin CEY

5. Fresnillo FRES

6. Hochschild HoC

7. Hummingbird HUM

3 years

1. EDV

2.ShG

3. FRES

3. CEY

3. AAZ

6. HUM

7. HoC

One year

1. HUM

2. HoC

3.CEY

4.ShG

4. EPV

6. AAZ

7. FRES

3 Months and 1 Month same line up

1. HoC

2.ShG

3. CEY

4. EDV

5. FRES

6. AAZ

7. HUM

Everybody at some time has their day in the sun.

Near the end of article.

https://www.gold-eagle.com/article/gold-why-empires-fall

Why gold futures volume is so high and spot gold volumes are so small.

Clearly Smartpunter has sold some RBW on a top slice and wants cheap RBW shares as he woos other people on other boards to do the down ramping for him on LSE RBW. It is a highly repetitive behaviour by Smartpunter and he should do his own down ramping then muck spreading. Chances of RBW going back down are now high as Smartpunter got the spoon out and stirred things up. He can not help himself and clearly something awful happened in his childhood perhaps it was very intense boredom.

Data from USA lay off tracker

Yellow Corp 30,000 job losses 31 July

CVS 5,000 2 days ago,

FEDEX 280 jobs in Texas as seeing recession impacts.

Microsoft 1,000 jobs late July.

Biogen 1,000 jobs late July 1/8 th of workforce.

A lot of smaller companies facing cash flow crisis.

The number one risk appears to be USA Treasuries increasing in the interest rate they are offering which may depress gold prices. However, we have a backdrop of USA data manipulating inflation through Government give aways to students, via health and social welfare, by releasing millions of barrels of strategic oil supplies which help subsidise nearly everything not just gasoline at the pump. The rate of growth of fiscal expenditure is taking off in USA and hence 300 billion plus in long dated Treasuries. USA is already on 125% GDP ratio on debt and it was taken down by Fitch for good reason.

Yellen claimed USA was the least dirty shirt compared to others yet an examination covered by an analyst on Bloomberg could site 9 other triple AAA rated Fitch ratings that were vastly better shape than USA and the down rating on lifting government debt that does not appear to have a ceiling to 2025 raises a lot of concerns.

Today we have make believe NFP numbers as August is usually heavily revised. Many people are on holiday in USA in August and the return data is reliant on assumption inputted by officials on non-returns. September has a similar problem if data was fractionally dependent on August collection. There is significant evidence of companies not sending in data allowing officials to fudge data on what they collect. The key may therefore looking at numbers of business failures which are increasing in USA amongst smaller companies.

Overall, I see stagflation and that history suggests that gold tends to remain fairly supportive in those circumstances regardless of higher long term rates. I also question who wants to really buy USA Treasuries from abroad. I was under the impression the FED could end up being the only buying source along with any banks they can bully to buy them as they will bail them out later on with money printing and currency debasement.

I therefore hold for better times with Centamin.