Member Info for Tornadotony

Pull back on goldminers has priced in another $80 price drop per ounce imop. Average gold price sold in Q3 will be 10% higher than all of H1. Higher production for some miner has not even been factored in some cases. October bottom for CEY is probably just above 140p.

On 23 September when spot gold was 2626, Endeavour was 1868p.

Last time the share price was 1669 on 11 September gold spot price was $2515 per ounce. We are currently at $2626 per ounce.

To allow people to get out at a respectable price before delisting.

The reality is that the Runcorn production model is not going to work as across the industry, the lesson learned is to keep as much as possible in-house. Apple have stated this very clearly and others are following. A lot of the IP value disappears in two years time and it is only the very latest IP that might have value. This operation is a small technology consultancy. They exist to offer solutions to a customer and deliver working models pre-production that develop R&D closer to market. This is no longer a viable listed company and remaining so is an administrative headache. It should go private allowing much reduced administration costs. The decision to go down the route is with the staff. If they resign the company has zero value. If it goes private it has to be at a token price in which the senior staff put up some of their own money and that would be a fraction of a penny per share. The idea that it can continue the way it has after the latest customer walked away is just a non-starter. Tenner knows that and hence why he is leaving. His role is completely defunct. Today I recovered the remainder of my sell out from here. I thought Runcorn manufacturing was a possibility but then industry changed its strategy on how it was to develop.

Gold overbought is still on weekly signal, but earlier time frames has already disappeared. I still think we get a gold miner rally into results during October as they are earning huge profits this quarter. China is now back in the market this week. India Diwali awaits.

Nigel

The quarterly results may well be brilliant. Assuming they are, I dare say the company might give a staff bonus to front line staff and perhaps something to BK Government as a thank you for keeping their staff safe and something for the government to aid those fleeing the on-going security issues. It all adds to creating that mutual respect and appreciating the needs of other stakeholders at particular times. Tony

Average price with all buying costs at 1705p. Toronto close price was 1718p.

75% back in at equal weight.

First of all, this is my first year of investing on Endeavour although I have invested in African gold miners for 13 years. I am therefore learning how the share moves between UK and Canadian markets.

The company is trading at 1.8x book earnings and holds a fair amount of debt. The mines are generally on the lower AISC compared to many others and Burkino Faso owns 10% of its two Endeavour mines. Endeavour has a good relationship with host countries in which it operates from what I have observed this year. The company enterprise value does have a west Africa risk factor in the share price compared to what it may be priced in other continents.

We now have an RNS that confirmed a $30M payment allowed to go through of $60M for the two nationalised mines. I am not sure if the President was testing the market as he appears to have not acted further on his previous comments. The problem of taking an underground mine like Mana requires a significant amount of expertise and a lot can go wrong. The second mine Hounde has significant resources to be converted into reserves and this requires quite a lot of future investment. If the permits were pulled the recovery on production would probably drop to 50-60% over time and the country earn nearly 50% on gold profits in just allowing the professionals to deliver it. In essence if the multinationals were a problem the president would end up trading it with a lot more additional problems on his plate and the bottom line would not be as good as he would hope for. For example, any environmental hazard would be his responsibility instead of a multinational company that he could sue in a North American court for a fortune.

Where does Endeavour go from here. In my opinion, gold is likely to pull back. Endeavour would be around 1760 without permit worries today. In the short term Endeavour and most other miners may retreat with the gold price if it pulls back. Once overbought signals are gone on gold near the end of the month we could get a relief rally. I then suspect it will peter out and deliver a December seasonal low price. Many others will see things differently. I will soon be retiring from all of this as tax changes are making it less attractive to do. I welcome others to give their views and of course they may be the opposite of what I think. All the best Tony

The gap below 1685p created awhile back on the run up to 1900 is closed.

In the congressional report Ivanhoe implied interest in other special metals relevant to the green transition. Of course they may be more interested in lithium or something else. They have a nickel, platinum/palladium and a copper mine in different African countries.

Https://wcsecure.weblink.com.au/pdf/WAF/02863294.pdf

If correct there is every chance meets the mining code and current arrangements the president wanted from Endeavour are in place. We await confirmation from Endeavour.

It is some permits and not all permits in my previous. I was out 78% from the peak but will hold what I have for the time being and see how it plays out. The company value is around 1700 without the the BK mines.

A large drop in price as a result of the leader saying they want all foreign miners out of the country and he wants to terminate all mining permits. Endeavour had already turned over two mines as we know to the Government earlier this year. The idea of any sustainable mining with environmental impacts not being done by a proper company is a false economy. They may know how to mine gold out of the ground but at what recovery and efficiency. A sensible discussion is hopefully going on this morning. The new mines are not in BK. The company will be on to this today and hopefully they can point out that it is not a good move for the country.

1779 close so a drop when we open is a possibility. Dividend pay out on Thursday.

Ivanhoe mines have $85M in the bank, experienced in delivering mining projects with several African mines. None in rare earths which they have an interest as they currently have none in their portfolio. I wonder if they could have a corner stone interest in the Pensana Angola LJ mine.

BPat

Your point about depreciation in accounting terms is correct. It still factors into enterprise value. What people are forgetting on valuation of Hummingbird is that enterprise value = share price plus all the debt. It is not just the share price and consequently as debt runs higher it takes value off the share price in the equation.

The biggest value is 1m reserve ounces in functioning mines. $140 per reserve ounce x $1M = $140M. Dugbe is around $45-50M total as a non functional mine asset. Resources are valued at $20 per ounce in West Africa. This is broadly how banks look at the situation. The best functional mines in Africa are valued at $180 per reserve ounce plus resources and net cash held. The story would be very different if mines were in USA or Canada.

With all the hurricane damage it is not surprising that huge numbers of people are being called up. The fact is that it is not real economic growth to rebuild after storm damage to get back to where life was before.

Absolutely no detail in RNS material, but an investor here should check published annual reports for any tax credits being awarded for building the new mine. The company should respond if questioned on it.

Significant withdrawal from Comex reported yesterday on the previous day 2 October, hence the recent direction on gold.