Member Info for TrekMadone

I am below 70p average now just! Trust my own research, been in this situation many times before and watched it turn. Wasn’t so long ago SEPL was dragged down from 120p to 85p now it’s back up and set to reach new highs imo.

Like I have said before for a yield investor DEC offers a contrarian opportunity at this price. £25k in here will give you more yield than £100k in the FTSE!

You could then manage your single company risk by putting the other £75k in a building society for another 5%!

That means you only expose 25% of your cash to the markets instead of 100% albeit in one company. And if the market tanks 10% you could loose 2.5k off of Dec but 10k off the 100k in math terms.

I haven’t seen anything in the accounts that’s put me off. Indeed the biggest risk was rates continuing to rise which would have affected the 12% of unhedged debt. Now the rate outlook has improved significantly!

Ops wise volumes and sales are doing fine so is fcf and they even got maintenance downtime included in the last numbers!

The macro situation for gas remains positive so we should still land the volumes and run off debt.

The latest TR1 was a buy by MNG, we have US insti holders in Columbia, vanguard and are in Wisdomtree smallcap ETF and Globals super income fund. All US institutions.

Like others have muted I wouldn’t be surprised if there was a bit of orchestration in the last couple of days to make the listing more ‘appealing’ although a declining SP surely isn’t helping!

I sold elsewhere to top up at these levels. A 20% upside from yield at this price is compelling.

I guess we will find out in the next couple of weeks but either way it will be a nice big divi payday on the 29th!

Usual caveats

Trek

Well done little,

I topped up two lots at 459 and a bit today just before eurozone inflation numbers came out!

Average now a shade under 479. Which is nice as there is also a technical trading gap up from 480-500p range

See it here…

https://uk.marketscreener.com/quote/stock/PHOENIX-GROUP-HOLDINGS-PL-105996789/

See also the table..

see how Phnx are discounted to us and euro peers!

It’s just reflective of shty uk markets. No wonder comps are moving to US and Europe!

+11% yield, results top end at 1.8bn in cash, +400m cash saved from acquisition. Pf hedged against inflation, incremental divi policy. Managing all the stuff no one else wants anymore so plenty of growth opportunities! Sp near all time low, lol!

If it wasn’t for the market it wouldn’t even be a contrarian play! lol!

Usual caveats

Trek

Annual inflation in the euro zone cooled to 2.4% in November from 2.9% in October, flash figures showed Thursday.

Economists polled by Reuters expected a reading of 2.7%.

Core inflation was also below expectations at 3.6%.

Officials at the European Central Bank have stressed that it is too early to declare victory over price rises in the 20-member euro zone bloc, as they monitor potential pressures from wage increases and energy markets.

Headline inflation has now cooled significantly from the peak levels of 10.6% in October 2022. Bert Colijn, senior euro zone economist at ING, said in a Wednesday note that “sluggish demand” should keep inflation on track toward 2%.

This is a breaking news story and will be updated shortly.

Cnbc

Trek

I got some today at 65 and lower! Waited for xd to add. I am convinced it’s just the malaise of the markets as opposed to DEC. Cavendish have clearly shown us DEC peer comparisons in their last note.

To illustrate I also bought pHNX today. They have guided that earnings will be near top end at 1.8bn! They also had a cash saving of 400m from their recent acquisition. They yield +11%, now highest in ftse! The sp popped to 507p on the news and wishing a few weeks down below 460, near all time lows. Shares are down over 24% ytd! In a little over 3 years they can buy themselves from FCF! Yet if you compare to peers in Europe and US only the PRU are down similar. See table here…

https://uk.marketscreener.com/quote/stock/PHOENIX-GROUP-HOLDINGS-PL-105996789/

And if you want another read across that discusses how money is leaving UK markets. Read LIO’s half year report…

“ "This has been a challenging period for the asset management sector, including Liontrust. This is shown by the fact that the industry experienced net retail outflows in the UK in September of £1.4 billion, according to the Investment Association ("IA"), ”

https://www.lse.co.uk/rns/LIO/half-year-report-for-6-months-to-30-september-2023-wfg5kva6kz9p4uc.html

Many have never known a period like this! Now add in the decarbonisation impact on DEC and you can see that the pull is significant.

It is unreasonable to say that the company hasn’t been acting. Just check back through the RNS’s and look how the debt is covered etc. The only thing they have really got wrong is the BB imo. That should have been hit head on. At least now after the results!

They may be waiting for the US to take up liquidity but unless they have been given a nod I don’t think that can be guaranteed and in any event grab stock now while it’s ‘cheap’!

I don’t see this as a distressed balance sheet and the macro outlook is positive.

I don’t like ETF’s/Trust and atm I can’t find better income plays from this level. But I have successfully traded my averages down in both and have a long term view.

Here’s to a Santa rally!

Usual caveats

Trek

Didn’t fancy RSG tro, Mali and Burkino I don’t understand. I am aware that PAF have assets in South Sudan but it’s just a shed.

Mind you EDV have assets in Burko and one of the lowest AISC’s in the world! But even though only 440m in debt which is easily covered they hedge a %. I would be looking for 100% exposure to spot for a longer term play.

Cote de Ivory is ok that’s where CEY And EDV have some top assets.

SHG is my go for gold, even though it’s higher AISC its balance sheet is transparent and debt is hardly anything last time I looked. Pretty sure there’s still a stock overhang but at least 12p has gone now like I predicted. 2p is sweet on a few shares there!

Sliced some FRES at 591 just grabbed 5%. May pull back tomorrow may not. Got options now. I don’t mind buying back higher as I have an anchor position now. Fed getting very dovish and if it looks like a stay home Christmas markets could fly!

Sticking with PAF though, xd tomorrow doubt the sp will take a hit for very long. Will buy some after the xd hoping to get average down a tad there ready for the lift!

Their tailings is cheap and when they get the power and water upgrades away should do well. Looks like an easy run to +20p there soon on POG or any ops hint. Not interested in holding though!

DEC wtf it’s xd tomorrow! I get a big divi from there but looks like will have to wait it out a bit now. Even my 70.1p average is looking dire atm!

Still looking for other gold plays though. Can’t seem to find many where the CEO’s aren’t FoS and the balance sheet isnt a car crash!

Most are completely uninvestable irrespective of the BB hype you read, but they can be some good trades only where there is buy/sell liquidity. My FReS trade was fractions of a pence off the mid. That’s a priority else the spread can make it all pointless! So any play must have reasonable liquidity.

Usual caveats

Trek

Thanks Tro,

First tranche in FRES and PAF (not on your list, strange)

Mine are trades here NOT tips!

Bought more DEC as well, that’s for lone term income. May buy more after consolidation depends.

Usual caveats

Trek

Looks like Paf, cheap imo and in SOuth Africa and Fres, finances are a basket case and will benefit lots from usd depreciation.

Cey got good prospects with new mines esp cote d ivory but chart not volatile enough. Fres better for trading.

I wanna ride not steady and slice along the way and recycle. Have shg for steady eddy.

All said I discounted edv as burkino v dodgy and srb as narrow vien an mcap always likely to need cash.

Got a spreadsheet of pro’s and cons now and discounted some but doesn’t mean they won’t do well just not for me.

Usual caveats

Trek

Given the lead time they probably have this away anyway. At 7.750% they just as well buy their own stock!

Closes next week and we find out in 5th or 6th Dec. I note it’s not in US due to regulations.

Usual caveats

Trek

Been looking through CMCL, CEY, HOC and FRES today.

Could split across the 4 but would rather put it all in the wrong one!

Just about made my mine up!

Trek

Citadel increased their short back to 0.6%.

Hope there a Santa rally and then a takeover!

Crazy price here!

Usual caveats

Trek

It’ll turn again and momentum will follow. People see a few wells and sell. Then they see buys and the price go up and they buy! lol!

Got more or less until 8th December so plenty of time and recently it went to 44p on less of a hint of finance than this!

Usual caveats

Trek

It’s been tough for years Mick. So difficult to find anything that will stick..

I have found investing in income helps. At least the divi stream offsets some drops.

But when you get companies like Phnx announcing that their results will be at the top end of guidance and that they have an extra 400m in cash left after an aquisition. The share price pops and then it drops back to where it was before the news! Even though inflation and rates have softened! It’s crazy. That’s a ftse100 company that is throwing off its mcap in cash now every few years and yields +11%!

There are lots of similar examples. But if you look at the investment houses they are saying that AuM’s are still negative! So money is actually leaving the London markets. I think investors have had enough and like much of the recent demise it’s followed on from Boris. No one seems to believe anything now!

And as for aim or small caps. It’s at a point where even the best research still needs a lot of luck to buy a winner! Most are at all time lows!

As you know I hold DEC, now yielding +20% and is about to pay off 270m debt in December. Goes xd this week and dual lists on NYSE next week. Sp went up and is now back down! Bonkers!

I am just sticking with the high yielders now. Only those with a dividend payment history and backed by solid cash generation. U have concentrated on trust a few of those!

Things will change and this could then look like an opportunity.

I have a few moonshots that I know well. PXC is one but I am not in any any with the silly numbers that I did during covid.

It’s just too difficult now and I need to do this to for income so have to protect one’s capital!

Santa rally and all will be forgiven!!!

Good luck

Usual caveats

Trek

UPL - buy, it’s doing things properly. Look at quality of its survey and JV.

COPL - is it 100p yet, oh more dilution, BB’s can be bad for your health!

Neither I hold, one I would the other I did, albeit to trade, shame on me!

Be careful out there!

Usual caveats

Trek

INSG - it’s on my radar I would buy now. Just that I can’t do it all as most now in income. But note it’s another appt that is being remunerated in stock!

It will likely move soon but watch spread and liquidity.

Usual caveats

Trek

29 sept 22 RNS….

“ During the period the Company charged its subsidiary entities $465,000 (2021: $405,000) in respect of management services provided, and $610,653 (2021: $361,678) in respect of interest at 6% per annum on the Company's inter-company loan to Konnex Resources Inc ("Konnex"), owner of the Empire Mine, the latter eliminating on consolidation. At 30 June 2022 the Company's loan to Konnex stood at $22.95 million (2021: $15.33 million). The Company has also advanced $2.28 million (2021: $859,900) to Lost River Resources Inc, a wholly owned subsidiary of the Company, to acquire real estate commercial and residential property and mining claim blocks to support the Empire Mine. These loans will be repaid from Konnex's operating cash flow in due course and are intended, together with royalties receivable from Konnex, to form a platform for a future proposed dividend policy to return money to shareholders.”

Trek

Hi mick,

There’s a few reasons for the drop…

1. Market sentiment across small caps

2. They missed their own timescales for delivering on the bond financing, market punished em. They popped up to 44p but it didn’t land.

3. They also landed a bridging loan. Only a couple mill. I sold and rebought cheaper. They are financed into 24 including the Nav creek drills. But they needed a cash cushion. I went through the numbers and a forecast and posted it there. Finances are sound but finite.

4. Here’s a thing, the bod always maintained that the bond was on the shelf. The terms were revisited with the recent rate increases, obviously, and went from 5% + Fed base to 8.5% + Fed base or a copper price multiplier. See 22 sept RNS. But there was no point in taking the bond as they had a potentially cheaper processing plan in place. Using ammonium thiosulfate ("ATS"). It means that you can separate the metals in drums and not heap leach. That means it can be done on own land so fast track permitting. It’s also much lower cost and has higher recovery factors so better mine economics. So why pay the coupon when they were about to come up with a cheaper plan. Obviously SP tanked whilst investors waited.

NOw of course it’s highly likely it’s all coming together. Of course there can be disappointment but if that’s the case after all this work and telegraphing it was imminent (which I think was to give LTH’s a chance) and should it not materialise they really have set themselves up for a fall!

I think we will get some assays to bump up price then be told they have finance. 80m is first tranch. Coupon is bi annual. There will likely be a roll on for the first year. They will also clear the Riverfort loan. They have income from a subsidiary as well.

It’s worth a punt.

Usual caveats

Trek

Blue,

Yep that’s the 40p neckline. If you haven’t read the last Corp ppt I posted link there.

It’s pretty much same old for resource companies with little in the price without finance.

Land the finance and then folk can talk about the ops and the resource!

PXC ain’t a WSBN it’s been slowly going about its business methodically. There are no ‘wideboy colourful investors’ playing short and long. Just guys that know their rocks and some have built mines before!

Trade some but keep some tucked away eh, could even get to +£3 with news easy peasy as that’s just a 10% value of measure resources. Not even the 20%!

A few years time could easily see 800p if they prove up! Fres went from 100p to 2100p in just a couple years. There are many other examples! Just gotta time the right ones and have a bit of luck!

Usual caveats

Trek

“Estimated less than 1% of the ore system at Empire has been explored!’

Previous mined head grades 6-8% copper! That’s before the other metals.

https://phoenixcopperlimited.com/Company%20Presentation/October2023.pdf

In 2021 the intercepted 8.38% copper grades below the oxides!

It’s potentially a monster akin to the Chilean porphyry systems!!

Note how the latest ppt is very ESG focused. There is much more detail in earlier ones. The recent one just has the cash hitting headlines imo geared for the bonds.

Bring on that finance and we then get credit for the ops and M&I resources. Atm pretty much zilch is in the price as that has been the nature of these markets!

Significant value will out with finance!

Usual caveats

Trek

Nice to see the sp recover the divi here pretty quickly.

Double bottom in on the pullback and it didn’t go below 117. Must say I had an o sht moment for a while as already hold a load here! But given impending news decided it would come back up at some point and the yield is well covered! So planned to stick!

Now we got over that little blip it could well head towards 140 again.

OPEC meets soon and POO holding up just! but that’s not the main drivers here!

Should find out about the divestment soon, flipping Nigerian time though!

Usual caveats

Trek

Small ut at 36.30, buys above UT, often indicates a higher open.

Usual caveats

Trek