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Wishful thinking, perhaps?
I rather like SHOE's rapid growth in Digital Sales. I bought for that reason, it should prove a rewarding long term hold.
We need to know more about BISI's selling procedures, how much of their coal is forward sold. and how much is permitted to be sold out of the o****ry. I read in one of the messages that BISI is permitted to export not more than 80,000 tonnes?
Huge spread! And a sharp dip today. Coal futures are down and falling further. Hard to explain the rather
fast turnaround to possibly normality (coal prices) within the coming 12 months. Yet BISI should benefit
while the prices are still high. On the whole, a hard act to follow without a trading update.
It would be hard to imagine that BISI is not benefitting substantially from the global high coal prices.
Even just $10 extra per tonne on the annual output of about one million tonnes amounts to $10 million additonal
profit. Would be nice to get an RNS trading update.
Good Results, good progress, good management, and yet the share price gone down. Should see
a reverse soon, as it looks like the low has been tested today.
BISI's current Market Cap at share price 110p is in the region of £12 million.
Possible Profit Before Tax this year at coal price just 25% above last year's: £16.5 million.
(Based on production 1 million tonnes and currency £1 : $1.37).
Coal Price Futures for the next 12 months to Novemer 2022, averages out at $175 per tonne,
which is some 85% above last year's price. At that rate PBT would be £62 million.
Am I dreaming, or what...?
The Interim Results, out yesterday, sounded very positive to me. I bought a small stake for a long term hold.
People would soon invest when is becomes clear that BISI is on a roller. Profits this year could be very high, indeed profits may even exceed BISI's Market Cap - much depends on how much forward selling has taken place / is taking place. BISI has produced acceptable profits at coal-price $90, now think of coal price 50% higher for a year, what would that do to profits on BISI's one mllion tonnes produced in the year.
Interesting times, indeed exiting times ahead
At current share price of around 120p (middle price) , BISI's Market Cap is barely £15 million. Take coal price for one
year dearer by just $50 per tonne above last year's average price of around $90 per tonne, then BISI is likely to make a
Pre-Tax profit of no less than $50 million, which seriously exceeds BISI's market cap, putting the company on a PE-Ratio
of less than 1 at current share price. Something is going to move, my guess is... the share price!
I absolutely agree. Just 250,000 tonnes - a quarter of the annual production of 1 million tonnes - sold away at say just $40 per tone above the normal price would bring in $10 million additional pre-tax profit (on and above the normal $3-$4 million pre-tax). And that is being very, very conservative. BISI is currently, proverbially speaking, sitting on a goldmine.
BISI produces coal profitably at $80 per tonne. Annual production is in excess of 1 million tonnes.
BISI receives say $140 per tonne for a whole year, then profit increases by 1 million times $60 = $60 million profit-increase.
At $180 per tonne: profit-increase $100 million
At $120 per tonne: profit- ncrease $ 40 million
The strong Rebuttal by the Management has not done much good. Shorters can be determined, shorters can also be right.
I bailed out after the RNS announcing an investement in four single occupancy flats ....at £700,000 per flat!
Energy stocks appear currently the ones to go for. I consider small Africa based coal miner Bisichi (BISI) worth a punt, but
don't take my word for it, DYOR.