Member Info for Wigwammer

It’s interesting that surprised2 now admits to being a holder. From memory at the lows, he rather enjoyed siding with ackey. Now the shares have multiplied, he joins RB and claims he held all along - perhaps he represents “the herd”. With regard to RB - his post is nuts 1) he can’t have locked in profits over the last week with a 175p average entry price. 2) he appears to have forgotten to include royalty revenues in his calculations - the most valuable npv part of the deal. 3) he believes that it will be easy for a company based in China to sell patented products outside the area in which they have a license. ATB :)

Straight talking... 1) with a 175p average it is “fanciful”’to suggest you have been locking in profits over the last week 2) at least “fanciful tipsters” can read an RNS properly.”ReNeuron will also receive tiered royalties at rates between 12% and 14% on sales of the licensed products in the Chinese market” + development and sales based milestones. Hope that helps :)

Yawn. Retiredbanker is here. Almost as dull as ackey. Same old story is it? Taking profits on shares that no one remembers you buying, then whinging about prospects. Difficult to see how you take profits over the last week with an avg of 180p. Take everything this guy says with a large dose of salt :)

“Breaking out here... irrespective of all the nonsense on these boards..” indeed. Despite the repetitive miserablism from certain quarters on here, the pog price continues to rise. Some perspective - the net debt of IRC equates to substantially less than the expected EBiTDA of Pog in a single year. Woods and trees, people :)

Fingers crossed, the first of many.. Plexus' CEO Ben Van Bilderbeek said, "This is the breakthrough rental wellhead order that both Gusar and Plexus have been working towards since we signed the Licensing Agreement in January 2016.?

Retiredbanker - thanks for clarifying that your calculations are based on a worst case scenario. Assuming a more balanced scenario I suggest 1) the current pog of $1330oz is a more reasonable starting point - it could rise or fall from there 2) some recognition of managements TCC estimate of $675oz is appropriate, particularly given they will have a better picture of how the pox economics stack up. ATB :)

I’m conservatively guessing 25% and converting to GBP.

L3 - that’s correct, the entire addition falls to the bottom line. So once the hedges fall out, the full $100 gold price increase achieved across the whole pa output of circa 500k oz will add circa $50m pa to pre tax fcf, equating to circa £28m net. Put this additional £28m on a valuation of 15x, and each $100 increase in gold adds 10p+ to the valuation of POG. That’s the power of leverage! Of course, it works in the opposite direction if the gold price falls, but if you’re right about gold heading up the economics stack up nicely. ATB :)

No Tiler. Retiredbanker deducts a $900 TCC, assumes that the entire expected production for 2019/20 is hedged at the $1250 price - less than half of it actually is - then deducts capex and interest charges. From this he gets to $25m net income. He is intentionally thrashing the figures. His cost prediction bears no resemblance to that suggested by the company. His realised price prediction bears little resemblance to the current pog or the amounts hedged. My best guess is he no longer owns the stock, or sold a large amount at a bad price, and is a little peeved about it. I don’t state this to undermine him - but to point out that it makes zero sense to own the shares and repeatedly claim pog can’t generate meaningful cash - unless he’s mad! I would take his posts with a pinch of salt :)

Hello Freddie - the point wasn’t aimed at you, just a general observation. Lawrence - the company have guided to a TCC of $650-700 per oz for 2019/20, and they will have detailed knowledge of the likely impact of pox. They have stated that the start of the year has been encouraging and they are focusing on cash generation. I’m not sure how or why a holder of the stock gets to an estimate of $900 or what superior knowledge they have of the pox economics - but it makes little sense for them to hold if they really believe that. My guess is several LTH’s capitulated below 6p and sold large amounts at a bad price - bear that in mind when reading their posts :)

Pog is up around 30% ytd. As a holder, that makes me happy. There appear to be multiple (alleged) “holders” who do not share my tranquility. Makes you wonder how many LTH’s capitulated below 6p. Would explain a lot :)

RB. With due respect, i find your $25m estimate odd. If you don’t believe the company estimates, and you don’t believe the debt can be repaid in a timely way, then why do you own the shares? Something doesn’t add up :)

L3 - my understanding is your $100m fcf estimate is based on the company hitting their own targets - 475k oz production, $675m oz cash cost = drives circa $300m ebitda at current prices, though they still have some hedges in place. $50m capex, $50m interest. Circa 25% tax. On that basis $100m fcf - the amount of cash built pa - appears conservative. Odd that some on here claim to be holders, but repeatedly fail to envisage a scenario where the company builds the cash to pay down the debt in a timely way. Vigilance required! Positive to see continued strength in the pog :)

“I do not understand why Polymetal did not buy POG... Something wrong with POG..” I’m not sure POG or POX is for sale. The point that over half of Russia’s reserves are refractory, and that another player sees an attractive return in spending 5 years and nearly half a billion dollars building another pox plant, suggests things are looking rather positive for the incumbents :)

L3 - if you believe they can consistently hit $300m+ ebitda, with falling capex and declining net debt then I suspect 8x ev:ebitda would appear conservative. That would imply an enterprise value of $2.4bn - deducting net debt of $600m leaves a share price of 40p+. If they have these figures in mind, would they pay 20p+ (circa £200m) to avoid a circa 25% dilution? Yes. IMO. :)

L3 - I agree and I anticipate fcf could top $100m in 2019 and grow from there. I suspect they will build a cash position with the aim of paying down debt in a timely way. However, even diverting a fraction of this sum - say 20% - would result in a healthy div yield being paid at the current market cap, which could garner interest from a broader community of investors. I don’t agree that the convertibles put a ceiling on the price however 1) RB estimates full conversion of the convertible debt will increase shares in issue by around 80m, moving the current market cap from circa £270m to £340m. With free cash generation of around £70m+ pa and net debt falling, I could easily see a market cap of well over £1bn being realised pretty easily, implying a 20p+ share price even post dilution ie we are a long way from a valuation ceiling 2) bear in mind that if the shares rise - it is likely to be because the fcf targets are being met. If this happens and the fundamentals improve, it is likely that the company will find it easier to raise additional funding to avoid dilution. At that point, with the outlook for the equity much improved, the company may well be willing to pay multiples of the current price to avoid dilution. ATB IMO :)

Kenj - any regular reader here with a memory brain cell will remember your pessimism. I don’t need to prove to intelligent people what they already know. The shares are rising because the positive aspects of the investment are proving more persuasive than the endless list of negatives provided by yourself. So to repeat - I have got it right and you have got it wrong. With regard to my message to Lawrence - I was just trying to help him out and give him an overview of what the convertibles are about. I’m not particularly interested in the exact conversion price - it may interest you and others, it may interest Lawrence - but not me. I’d rather get the big things right - like where the share price is going - and leave squabbling about the little things to people like you. Hope that helps :)

Kenj - I have been right about the direction of the share price, and you have been wrong. As another poster remarked, you have been far too pessimistic. Anyone who acted on your pessimism is now out of pocket. Will leave you to your petty discourse. ATB :)

Hi Lawrence - you are quite right. The holders of the convertibles want the shares to go up in value, just as we do. If the shares are above the strike price - around 8.3p - at the maturity date then they are likely to exercise their conversion rights. At that point, the company can choose to 1) convert the bonds into shares at a price of 8.3p or 2) pay the equivalent amount in cash. In the meantime, they receive interest. Hope that helps :)

Kenj - the slanging match commenced because you wanted to commence it. I understand you may be a little socially inept, but reflect on your choice of words and ask yourself if they are conducive to adult discussion or something else. There is little point to you repeatedly lifting my words out of the context in which they were placed - a response to RB - and claiming they are wrong. RB had posed the question - in the event the conversion right is exercised, how many shares will the bonds convert into? Well RB, in that situation it could be that no shares are issued at all - the company has the option to convert or pay cash. Look RB - here is an excerpt from the annual report proving what I have just said.... My guess is, several posters learnt something from those posts that they didn’t know before - in particular, that the exercise of the conversion right does not necessarily result in dilution. I’m not sure what they’ve learnt from your intercession - other than that you are gagging to have an argument. Afraid I’m not that interested. Happy Sunday :)