Member Info for Tornadotony

apropos1
1. Have you ever been in a bookies office to bet on horses and greyhounds or whether snow will fall on 25 December in your area. In other words are you someone who is prepared to lose money on a bet that can win or lose. If you are too nervous, than you can not afford to take the risk.

2. Do you have other assets like property that is not fully mortgaged or other funds that keep you in your life style that are well separate from the equity market as although cash loses against inflation, most of us need some to pay credit card bills and so forth and may need to fund emergency use.

3. Do you prefer a company like Hargreaves and Lansdowne that run funds on your behalf. They take a cut but their funds are either sector based, diversified or whatever. It does not stop you having some funds set aside to stock pick on a couple of companies and take a chance in a separate account but you play with small amounts.

4. Are you a trader, an investor or someone who wants to start with trading to build free carry profit that you later regard as part of your long term investment. There is a difference and you need to know what you want to be.

5. If your investment is 30% down at any point will you be sleepless at night, have anxiety or depression or are you optimistic and resilient enough in that it does not bother you. Equally if your investment is 30% up that you can resist greed by not adding what you can not afford onto a winning investment position. Handling emotions is vital.

6. You asked for education tips but the first place to start is yourself. Can you put time into doing research. Do you want to understand all about the gold commodity and what affects it as this in turn impacts gold mining companies. It takes years to make money from doing this and it only takes one very bad year to have 3 or more years to get back to where you were before. If you make 5-6% net over 10 years every year by doing everything yourself that includes a few minus years against the odd year that you got 20% or more than you may have protected yourself against inflation and then you have equalled the same performance from buying gold bars at or above 1 ounce that you bought from a National mint recovering their premium overhead and the differential between buy and sell prices.

All the best Tony

I experienced many tornado's in my childhood with one wiping out all the houses at the bottom of my street in Illinois, but nothing on the scale we are seeing on the news tonight that hit Kentucky. I remember once running from a baseball field with a tornado dropping down behind me. Its why I call myself TornadoTony, I survived to tell the tale.

Steve,
They started with $60M baked in on savings from completed projects and then gave some delivery times when things kick in. For example, the fleet changes were on-going and complete in a few months time, the solar farm build should complete 6 months into the year. They indicated that AISC will vary each quarter and the range will be made tighter during the year. They were holding out hope of some inflationary declines but fully expect Egypt's inflation for labour to be 6.3% in 2022. What they do not know is whether Egyptian pound devalues against USD and how much. Hence we get these wide ranges and they set up for positive surprise after the fiasco of late last year.

I am just waiting for a confirmation on the bottom and I suspect it was today. When bloomberg bring on so called experts to speak on behalf of all the FED and say they will end taper in January and hit the ground with 4 rate hikes, that it is the time to buy gold and those who mine it. All the best Tony.

As was said at the webinar around $20M in savings has not been incorporated in the waterfall of cost increases from on-going cost saving projects and the energy based savings once the solar plant comes on line is $13M per annum and $7 per ounce saving on the AISC may be delivered to technology improvements on fleet vehicles. It is therefore possible that the high end $1425 figure drops by $60 from cost savings alone. This would be placing the high end range to $1365.

It is important to note that the underground Sukari is converting resources into reserves in year. The RC drilling in the underground is new and likely to lead to better grades going to the mill. Improvements on mill recovery are also expected to exceed 90% by 2023. Other Egypt site results on drilling are to be provided in H1. The PEA on Doropo also to be delivered. in H1. So we do have positive news flows to look forward to that could give some positive surprises. The management are down playing things in the light of events in 2020. I prefer the method of not over promising and deliver what was expected or better from now on. Tony

I doubt it when all you have to do is walk down to any shop or look around the shopping net and see FIAT pound sterling is being turned into worthless paper. Take our 87p share price which is 2p more than a first class postage stamp to send a Christmas card within the UK.

Darren your not the only one. I certainly have not seen this coming. We have a rising production base and reserves and resources being developed on a longer life of mine model. To achieve all this takes a higher AISC and not wiping out cash or taking a bank loan from another source to fund it all instead. The up front cost of doing all this is $80M in 2022 and then after that a return of 100,000 ounces in production and a competitive AISC for two years delivering $80M as shared profits. The gold production profit being shared gives a net of at least $12.5M and could be much higher depending on prevailing gold prices. So all that AISC spend in 2022 comes back to us and delivers longer term stability. The financial review will have to look at how Sukari operates if a loan was taken to build another Egyptian asset and what happens to the profit share set up as it discourages investment via a bank loan and encourages a model of doing it all through high future AISC instead and EMRA get less money back anyway via that route. Another factor is how low interest rates remain. If they can not go up much it allows for borrowing as a growth model metric. Of course they need to find that new mine deposit first, but the fact they are thinking this way suggests they are optimistic at least of finding a good source. Tony

Well written first post shipwrecksheep. You have summed up what I feel as well.

4 December 2013
28 November 2014
18 December 2015
15 December 2016
6 December 2017
6 December 2018
20 December 2019
24 November 2020

Hopefully 9 December 2021

Can not recall see the RSI hit so bad in awhile so got some some at 87.58

Price to book ratio for Centamin at this time is 1.07x which is the lowest for the entire year. The lowest in the past 5 years was 0.92x on 23 August 2019. The 5 year average was 1.484 and the peak matching the high gold price was 2.5 times. 78p would be a new all time low on Centamin share price. The operating PE rate is 6.0 and normalised PE is 9.9. Both of these are historically very low.

As for yesterday, the company had done some homework and carried out enough drilling to deliver resource and reserve data that would meet audit requirements and had not been done before. The new CEO has been repairing the inherited legacy of what a previous manager had not done. Restoring back reserves and resources was a first step, and now they are drilling to find the bonanza grades which could give the company a solid output profile to 2027. There is a cost of doing it and AISC that may have been held down for budget reasons is now come back up to recover the remainder that had not been done in the past. So far the company has been punished for putting a lot of problems right. Eventually, Centamin share price should correct to fair value.

As for the finance review, could Centamin buy another mining company that can deliver 3M ounces and who knows may be the next Sukari type of deposit. Such an investment uses up the cash in hand and may need a debt line, but securing what could be 6 years supply would model Centamin back to where it was in 2015 with many promising years in front of it.

Also have abuse of power. China and others states where it happens all collapse eventually just like the Roman empire. Corruption does harm to others which is the definition of being led by stupidity. Of course the UK is no exception in having stupidity in charge, but they are in good company with China, Russia, Australia and quite a few others. USA leader is of course sound asleep and farting a lot.

My calculations as the baseline price at 1775 gold price is 101p.

This valuation is $40 per resource ounce and $140 reserve ounce in the ground and $250M held in the bank. These rates allow for plant and fleet with on-going operations and all the info we got yesterday. At $1875 gold Centamin should be 111p.

Viable,

I read this one and several others. The Centamin presentation today was mentioning the difficulties with supplies and they have to restock inventories with an additional $18M on inventory products during 2022. They also could not spend $50M on planned non-essential products that are all carried forward into 2022. I know Polymetal also had difficulties with the chip shortage affecting their fleet.
All of us in our working lives come across foul ups and they quite often happen when someone is under a lot of pressure. When an investment drops 25% in a second, it should be followed up next week with a full story with a broker interviewing them and where things go next and how this set back is being managed under existing resources. What looks really bad is to not care as quite a few management teams of other companies that want our investment do care about investor stakeholders and its important not to lose sight of having everyone's support.

ps://www.centamin.com/media/2471/cey-lom-investor-presentation-final.pdf

On three different slides they break some of it down, $74 increased processing costs, $21 sustaining capex costs above the mean, $34 was on shipping and G and A costs, Corporate ESG etc was $18, rebuilding of inventories $18, $48 additional capex that is non-sustaining as they are doing a lot of drilling etcetera, $50 was a carryover of capex from 2021 that was not spent this year. Which have added $275 per ounce into 2022. Some of these disappear on 2023 and contain elements that are 2022 only. AISC did increase during 2021 higher than the base from 2020 so the starting point becomes $1150. 1150 plus 275 and gives the top end figure of $1425. What can happen during the year is only half the non-sustaining spend happens and that we could get another $50 carryover into 2023 and the company through savings achieves another $40 off and quite quickly the figure is $1300. If the gold price is lower the company would re-plan other activities and that is where the $1250 may come in or inflation reduces and so forth. Hence the wide range.

So before when AISC was $900 and gold was $1250. Real profits may have been just $200 an ounce. With AISC say at $1350 and gold averaging 1800 the profit is $220 an ounce. If AISC goes down to $1250 the profit strikes $270 in future years. If gold goes up a further $100 the additional profit for CEY is 21%, but usually AISC overruns as well and hence why I suggest that every $100 in gold increase pushes Centamin up 10p which is 11.2% on its base price which for simplicity I call 90p a share.

6.17p added to bring me into line very near with placing price and what my average was on prior ownership last year when I first bought in. I am sure this will move up with news.

I also topped up. Currently skirting the support line.
On day one post Moderna booster. All I can say is that has certainly got my immune system working.

I have written a letter to the company. Any response will be shared here.

Tony

Walshe121

I believe there was an extensive evaluation of the issues before any money was spent on this and it was to go into a lot of detail. So I think its all considered. Reminds of the solar panels at Brighton University and nobody thought about the seagulls. Tony

The market is waiting for an appearance from some highly paid Shanta employees to properly explain how this all happened, why it took a whole month to fix and what is the 2022 production prognosis. Having the discussion and allowing some QA is critical at this time. I dare say they have been ringing up major investors all of yesterday. We all deserve as investors a professional response from the company.

I am staying with my core value of 118-120p. The reason for the AISC rise next year is a huge amount of drill results. The solar plant from memory cuts 1/6 of all fuel use. Centamin is forming a base where it goes up 10p for every $100 rise in the future gold price.