Member Info for Visitor

Unfortunately this is Tanzania and notwithstanding Shanta appears to have a much better relationship with the Government than other miners and has received a small rebate in Nov 2017, no company is currently receiving VAT rebates back: not just miners, but oil and gas outfits etc. Companies do appear to be allowed to offset it against Corporate Tax though (Acacia one example), so they are effectively getting it back but sure we'd all be happier with a cash rebate!

However the HMRC has its own brand of nefarious powers and shenanigans. I believe it now has the power to directly access accounts and recover "debts". It is then up to you to dispute it after the event with they were wrong. Anyone who has dealt with HMRC knows mistakes are common and it can take a long time to receive any rebates or overpayments back. By that time the damage could be done if that money was required for actual company activities. So it's all well and good claiming "TIA", but some Orwellian regulations and rulings have caused more than a raised eyebrow back in Blighty. Of course the oligarchs, elites and super-rich remain untouched accept for a few scapegoats to please/ distract the masses. This Is UK.

Some in-depth analysis there

Hi Ragnar, make money,

I too have continued to top up. I rehashed my analysis and I also believe this is a very good entry point. In summary:

a) SLP Basket Sale Price: currently circa $1,040 Oz

b) SLP "All-in costs": currently circa $708 Oz

An "All-in cost" metric is much better than "AISC", as it truly is "ALL-IN" and includes for all costs including Capex and Financing (although N/A to SLP as they have no loans). You never see a miner be as transparent as reporting all-in costs, yet SLP started to do this in their last few quarterly reports. I've calculated the above based on their last All-in cost metric of ZAR 9,343 divided by current Forex of 13.2. Now I know Capex and working capital of course fluctuates, but consider last Q was low production the above all-in cost is likely conservative.

c) Production PGMs next financial year July 18 - Jun 19: est. 80,000 Oz

d) Margin: 80,000 x ($1,040 - $708) = $27million

So before Corporate Tax you're looking at Profit of $27million. I believe SA Corp Tax is circa 32.19%, which leaves you with whopping $18million p.a. AFTER TAX.

So in addition to this when you factor SLP has:
- cash in the bank of $17.4million already (may be more come 31-July report but Ragnar probably right tax bill may eat up any increase)
- whopping trade balance of $18million in SLP favour (i.e. cash owed to SLP). And remember trade receivables is not inventories, but actual monies owed to SLP. This figure is from Interims, so in August we will get update in Accounts.
- 10yr "Life of Mine"

Even on a very conservative Forward P/E of 6x, that equates to market cap of £84m or 28p. And that's based on current PGM basket. If Platinum can get out of the doldrums the picture will improve even more.

We are overdue a re-rate, however I don't think we will get the re-rate we truly deserve until a dividend is announced and the broader market takes note. SLP needs to push through the low sentiment in the PGM sector and get itself noticed. It's massively undervalued in my opinion.

Even if Rhodium only reached half the 2007 peak to $5,000, that would add $300 to the basket price. Against a 80,000 Oz p.a., that would be $24million extra margin!

One can dream. Looks like we're not the only ones interested at the next Q report. Have FIL Ltd come from nowhere to hit 5% of equity?

Good old Rhodium. Appears to have finished at $2,345 in US. So SLP basket price around the $1,035 mark

Should be only 10 days now until next update. Hopefully a strong production update and perhaps, although hard to tell with ZAR forex variations, in USD equivalent terms would be good to see cash in the bank at $20million+.

Then I hope we see a dividend announcement in this Q report or next month for the Interims.

Accept it was not a solid last quarter and they made only $10million at $1,307 gold price, equating to a $100 Oz margin, so now at this gold price they're only breaking even.

So the only upside would be positive news on the dispute resolution with the Government. However as that now has no deadline and kicked further down the road, it's quite tough in the short to medium term to be bullish.

Here's the quick-fire Bunker Hill factsheet and presentation. HUM really should have added very short blurb or just a link in the RNS:

http://www.bunkerhillmining.com/_resources/factsheet/factsheet.pdf

http://www.bunkerhillmining.com/_resources/presentations/corporate-presentation.pdf

http://www.bunkerhillmining.com/_resources/news/2018-06-20.pdf

At an estimated cost of $90million:

a) 8yrs+ LoM w/ huge amount of potential to extend this further and high grade drilling intercepts of >20% zinc.

b) 1,500tpd processed or 547,500 tonnes per year est. commence Q1 2020. At 5.08% zinc, that's 27,813 tonnes per annum, equating to 72million in revenue per year for zinc alone (using $2,600 per ton), with silver and lead too. Potential to double throughput to 3,000tpd.

c) experienced team in place and SRK Consulting have been involved in reviewing company's analysis to date.

Looks like a potential good project and company for HUM to take a minority interest in, subject to their own DD. Also at a good time, getting in early before they plan to list on TSX later this year.

There's been considerable melodrama and hyperbole here and unfortunately partly caused by poor PR by HUM. But reactions here have still been over the top in my opinion.

If you actually look into Bunker Hill, it's a promising prospect and now more a zinc play first and foremost, rather than lead. It's far advanced in terms of approvals and it's complete speculation to say any such approvals would simply be overturned by a new government, in say 2024.

Dan Betts has also been taken out of context in terms of when he said he'd rather not tell shareholders on Bunker Hill... The key being tell them YET. It was clear he was referring to at this very early stage, as HUM invested to allow them to do detailed due diligence on the Project. He is intelligent enough to know it may garner such criticism as seen on this board. So as HUM have been forced to disclose at this early stage, they should have provided more background and an overview on Bunker Hill in the RNS. I agree with JW - whilst they don't need to issue a RNS, they should issue a simple short presentation on their website providing an overview of Bunker Hill. If the due diligence proves it's a good prospect, then we should progress our investment accordingly.

I suggest people read up on Bunker Hill for themselves and make up their own mind. Start with few links posted by Ronnie.

Extasio - agreed. Once you take into account increase in inventories and receivables, decrease in payables, all of which are positives for SHG's overall balance sheet, it makes sense.

They should now be nicely set up for a very good 2H 2018, however until we get the next set of results, as net debt is pretty much unchanged and gold in the low 1,200s, share price may bounce around and be stuck between 5 to 6p.

May take a better set of results or turn-around in gold price to give another push higher

I'm not surprised for last few trading days you can't buy anything of any material size at the bid price. It's a joke

I read it as poor set of results. An increase of 13million cash is not good against production of 133k Oz. That means they only made $100 per Oz at a hedged price of $1,320. So at $1,250 they will make next to nothing. I guess we will find out on 20 July exactly what is behind the numbers. It doesn't matter if they meet guidance if they can't get all-in costs down and actually make decent free cashflow

It's been an absolute dire few days (weeks) for platinum, now at $800, with the discount between gold now $440 and palladium $140. I know it's a bit risky to catch a falling knife, but decided to buy some platinum at these prices.

I know there is nervousness regarding car tariffs and the like from US against EU, but this move feels overblown and driven by short selling rather than longer-term supply-demand dynamics.

PGM metal Rhodium a relatively illiquid market not prone to trading, but more actual end-user buying, remains at $2,260 (for now, hope I haven't jinxed it). So SLP basket in USD is still over $1,000.

Such platinum pricing as alluded to by others will play havoc for the bigger players and major long-term structural damage. Long-term, maybe it's better for SLP who still make a very decent margin at this level and can reap full benefit when the snap back up happens.

With quarterly results end of this month and then end of Aug Final Results, a lot of news coming up. If they stagger it, hopefully quarter results will show increase in production and lower AISC (due to weak ZAR and also higher production) and then an updated dividend policy/ dividend annoucement in Final Results.

As soon as BorderTerrier finishes up his 6th novel, his "magnum opus" as he referred to it, he'll pop in. He only comes on here when he has writer's block judging by his posts... Which appears to be a lot In fact I have a sneaking suspicion BT is the one and only George RR Martin. I wish he would get on with his Game of Thrones and stop letting his fans down. His repetitive posts are truly wasted here.

Even with Plat where it is, the SLP basket price is around $1,048 and with ZAR weakening to 13.9, that should significantly help the AISC and all-in costs.

The only potential downside is that SLP have so much money in the bank (which is reported in USD), if it's actually held in ZAR currency, the ZAR weakness will decrease the reported amount in USD. However I'm not sure if SLP hold its cash in the bank in SA in ZAR or USD. I assume it's a mixture and hopefully it's mostly in USD, but who knows.

Hi Ragnar - I honestly don't understand Liberum's note. End of Q1 18 SLP had just shy of $18m cash in the bank. Capex of 18m over 4yrs is nothing. Less than 5m a year and means SLP's cash balance will continue to rise. How could Liberum possibly think cash balance unlikely to recover past 8m?! I note Rhodium is still at $2,250 levels and saving our basket. This Plat price is incredibly disturbing for the big underground plat miners who have an average AISC over 1,000

Is your good friend the sheriff, a fan of your best selling novels?

I think you under-estimate the mentality of the IIs invested in HUM, who are over-weight on precious metals miners across the industry and appear to be in it for the long-term (Odey, Majedie, Capital) and doubt would agree to a low-ball figure, from an entity negotiating from a place of weakness to achieve a low-ball figure with no share-holdings in HUM. I agree that many PIs would capitulate... HUM seems to have a lot of stale bulls and nervous types who clock-watch this. So I tend to agree with Tom's analysis of this. We have perhaps 2-4 weeks to wait until the first Quarterly Production Report... Although you wouldn't think it with talk of buy-backs, dividends and "fundamentals" like they've already been proven, anyone from the outside would think HUM has been producing for donkeys years.

Platinum is getting a pounding and SA specific we have release of the Mining Charter and Eskom wage dispute which has potential of causing "load shedding" and disruption if it continues, thereby impacting power to miners and production... Whether in this scenario it would impact Samancor and SLP production who knows. With the revised Mining Charter now out for public consultation, it would be good to understand once and for all whether SLP comes under its remit, or as a purely tailings operation/ company, it falls outside its remit.

Far too expensive yes and we would need every dime to fund our portion, even as part of a JV. Which is why I find talk of buy-backs and dividends slightly bizarre and short-sighted, when there are huge growth opportunities to fund in both Mali & Liberia.

Whilst positive, I would have preferred they just pay off all these loan notes with a high interest once and for all in April 2019. I know they are paying off huge amounts of other debt and deleveraging at a rapid pace, so begrudgingly I know it's probably prudent thing to do though. I hope this frees up cash that they can now use for Singida and provides optionality that they will not need external financing.