Iofina Live Discussion

Gooffy 27 May 2015

Re: 2014 Results Of course iodine might go up and they will refinance it based on your figures

Tentative Predator 27 May 2015

2014 Results Because of the $20m loan due May 2017, the only thing that really matters here is cash. So I've focused purely on that.2014:. "The Group's opening cash and short term investments position for 2014 was $8,268,755 and the closing position was $6,966,733, a decrease of $1,302,022". Opening position: $8.3m (in the cash flow statement, that's listed as $2.1m cash and $6.2m investments). +$5m additional loan = balance $13.3m. +$2.6m gross profit (this is cash+receivables, I adjust for the $1.3m receivables in the next line) = balance $15.9m. -$1.3m increase in receivables (money we've not yet received was $2.6m and is now $3.9m so that's sales included in the gross profit figure but not yet received) = balance $14.6m. -$0.4m decrease in payables (we owed $3.7m and now we owe $3.3m so we paid out a net $0.4m) = balance $14.2m. +$3.4m from decrease in inventories (profit was previously booked but we only got the money this year because we used the stock this year) = balance $17.6m. -$1.4m interest paid out on the $20m loan = balance $16.2m. -$6.2m capex (includes $0.3m from admin expenses that are converted to intangible added value) = balance $10.0m. -$3.1m admin expenses (headline $5.4m figure includes $2.0m from depreciation/amortisation and -$0.3m included in investments above) = balance $6.9m2015:. starts with $7m cash.. I'll assume guidance is valid so they'll produce about 500 tonnes Iodine, and be optimistic about profit and expenses control.. 300 tonnes will be used by IC to produce derivatives giving ~22m revenue , with a gross profit of $3m (factored in current Iodine prices). 200 tonnes @30/kg 200x1000x30=$6m revenue, with a gross profit @$5/kg, ie $1m. total expected revenue $28m. +$4m gross profit. -$1.4m interest paid. -$3.1m admin. -$2m capex. assume no change in payables ($3.3m)/receivables ($3.9m)/inventory ($3.5m) (net would be +$4.1m if all realised). leaving $4.5m cash at end year (+/- any changes in payables/receivables/inventory). a higher level of capex will of course leave less cashIf there was no debt, this would be a reasonable investment. With the $20m loan due May 2017, I wouldn't touch it without details of some long term debt restructuring.

share 123 maiden 17 Mar 2015

Re: Water permit - response from DNRC Thanks for the update Phronesis, so we might not hear anything until June.

Phronesis 17 Mar 2015

Water permit - response from DNRC response from the DNRCear XX,The contested case hearing in the matter of application no. 40S-30066181 by Atlantis Water Solutions was held on February 19, 2015. The parties had until March 6, 2015 to submit a closing brief in this matter. The record was closed on March 6 and the Hearing Examiner now has 90 days from that date to issue a decision. The decision will be posted on the DNRC website under Hearing Orders. The current link to the Hearings Order page is: [link]

share 123 maiden 19 Feb 2015

Water permit Today is the provisional day given for the hearing regarding the water permit, from last RNS."Pursuant to the Company's 22 December RNS, the Department of Natural Resources and Conservation ("DNRC" of the State of Montana has reviewed all objections and only a portion of one objection has been deemed valid, for the Company's Montana water permit (No. 40S 30066181). All other filed objections were deemed invalid. The hearing date for this single objection, from a local water supply competitor, is tentatively scheduled for 19 February 2015. The Company will vigorously defend the granting of the preliminary permit and continues to move forward with execution plans for this water depot project."Lets hope the permit is granted - there should be another RNS soon.

lambrini girl 03 Feb 2015

Re: more good news! approaching weak buy/small stakes..

Tentative Predator 20 Jan 2015

Re: Production rates 2. I think you're misleading here. It's crystal clear that anyone looking at this company wants to know they borrowed a further $5m and spent $7m in H1, rather than that cashflow out was $2m3. You're saying I'm misrepresenting facts by missing out "exclusively within Atlantis Water Solutions"? That's bizarre, it's not particularly relevant. Iofina needs to raise the money or a JV, whether that's through Iofina or a subsidiary makes no diff.4. Indeed, I agree RB Energy is already essentially gone. The cost of IODINE production it makes is $23 so that'll get snapped up when the court finally winds them up, whereas the lithium will get dumped. So there will be the same amount of Iodine coming in to the market, only at a nice low cost for whoever buys the operations. These small companies (including RB) are marginal to the overall market, they provide a very small percentage. It's the big players that matter. And yes, I agree SQM makes a difference in one way - they will likely continue to drive down the price which is the critical thing affecting Iofina's profitabiity for any increased production.I don't believe I've said anything at all misleading, all my numbers are backed up and all my statements quoted from the RNSs and completely in context.I have no agenda, I have no holding here (neither short nor long) nor do I care which way the price goes. My analyses are in depth because I've followed this for a long time and as I said, it can become an excellent company in which case if the price is right I'll become a buyer. However to think there is any clarity based on current figures is misleading, I'm crystal clear in my posts that they can go either way.

WhopperK 20 Jan 2015

Re: Production rates 1. You're welcome2. Cashflow is just that, its either in or out. Net cash flow was negative $2m. Cashflow from operations was negative $7m yes, but you chose to deliberately mislead and focus on the negative.3.The Montana Dept of Natural Resources has already approved the application for the water licence, its up for objections, they have received one valid one, the hearing is on the 19th FebYou've chosen to be very selective with the extract of the quote you have used. Here's the full quote "The Company will not fund this non-core water project with the current Iofina cash on hand but instead seek a joint venture partner or specific project financing exclusively within Atlantis Water Solutions". So that's twice you have chosen to misrepresent that facts.Also, I am pretty comfortable that a JV with Halliburton involving an upfront payment to IOF is already on the table. If it isn't they will get funding through AWS, not IOF4. SQM's makes all the difference, they are the market leader with approximately 30% of the market, they are driving prices down to defend that market share. It has nothing to do with over capacity. Forget the small players, the other two big Chileans Cosayach & RB Energy are highly likely to fold this year due to financial constraints .RB Energy having been pumping that market with iodine in 2014, but they have high costs relative to IOF. The company, due to it's lithium side is in serious trouble, under financial protection from the courts. The company is highly likely to go bust early this year. The first court protection deadline is 30th April.Cosayach, have had to shut down unprofitable wells.Two banks have just won awards of a total of $190m. The IRS have raided their offices re an $82 million tax fraud, they can fine them 4 times thatSQM drives the prices down, and hastens the demise of the competition.So yes, I stand by what I said, if anything it is even more evident now.I'm not going to get into a "who's got the biggest dong competition", so I'm not going to reply to any more of your postsGood luck with your investing

Tentative Predator 20 Jan 2015

Re: Production rates Thank you for your considered suggestion.1. Indeed, profit is accounting and largely irrelevant to this company. Cash is all that matters here given the $20m debt due 2017. I should have used the term "cash positive" rather than the loosely applied "profitable". Thank you for so delighfully correcting me.2. Cash at end 2013 was $8,268,755 (see fy results). Cash at end H1 was $6,270,754 (see interims). But that was after an inflow of $5m from the April loan. Net cash outflow for H1 was $7m.I do believe at some point they did announce capex was on hold. But the most recent relevant statement was in the half year results "With the funding raised in April, the Company is in a position to continue to grow iodine production at strategic locations through new plants" which does suggest capex had only been stopped temporarily.3. The water permit was first discussed in the 2009 reports; 5+ years to obtain water rights suggests it's not as straightforward as one would think. Regardless, the upside will require financing "The Company will not fund this non-core water project with the current Iofina cash on hand but instead seek a joint venture partner or specific project financing". Difficult but not impossible in their current situation, though the last attempt to get a JV for the water failed (2012). You could argue that it would make refinancing the $20m bonds easier because they could raise finance and refinance at the same time. Or you could argue that they already need to refinance the $20m bond which means raising even more is problematic. I don't call it either way since the water now, as it has been for at least 3 years, is pending.4. SQMs policy makes no difference to the facts except possibly that it means you can assume prices will continue to trend down. This year has seen record output of Iodine despite the firm downtrend in prices; the market prediction is for this to be maintained or increased next year; prices are being driven down consistently; no large producers have gone out of business; the small producers that have been driven out of business are actually driving down the overall cost of production as low cost producing mines are being sold on by administrators at discount prices to pay off creditors while the high cost ones are being shutdown at no real cost.So it appears that the sum of the "riddled with inaccuracies" is that I should have used the term "cash positive" rather than "profitable".Good luck to the holders, I look forward to the fy results for further analysis. As I said, this could become an excellent company or go down the pan, it all depends on management but it's on a knife edge atm.

WhopperK 19 Jan 2015

Re: Production rates Wow, this post is so riddled with inaccuracies, I just don't know where to start1. Making a profit is not dependant on the level of Capex during the year. Cash and profit are two separate things entirely. If you don't understand that basic premise, I would give up investing now.2. H1 cash outflow was $2m. Capex has been put on hold (no more new plants for the time being). In the trading statement after the interims, cash had actually increased. Since then sales have increased, production has increased and overheads reduced. Where are you getting your $6-$8m outflow from? 3. Impending decision on the water permit (Feb at latest with any luck). No impact on the iodine business if it fails. Huge upside if its approved4. Global iodine inventory levels/production/capacity... SQM's stated policy of driving the price down to force the other Chilean producers out if businessThe only thing you got right in the post was the market price of Iodine, but seeing as IOF's USP is the low production costs versus the Chileans, and the fact its all going to Iochem (who are struggling to meet demand) it's not really an issue

Tentative Predator 16 Jan 2015

Re: Production rates So expecting $25m revenue. A probable net cash outflow of $7m-$8m. Iodine prices dropping consistently $2/quarter, currently around $32. The iodine production is now sufficient to feed the chemicals business totally, so that means that they can turn profitable if they stop capital expenditure on new units, but the low iodine prices means the predicted 50% increase in production for next year doesn't actually make much money, cost of production is now getting too close to Iodine prices. Iodine suppliers as a whole are still generating more than the market needs, and there's no immediate prospect of any cutbacks from larger suppliers. Some smaller ones (eg RBS) have gone bankrupt but supply has still increased.All this means the actual numbers are on a knife edge here. Good management can turn this into a sufficiently profitable company to fund paying the $20m debt sufficiently that it can be refinanced. That's the key issue for 2015. If by the end of 2015 the $20m isn't refinanced, then 2016 will likely be a disaster - when you try to refinance with 1 year left all the lenders know they have you over a barrel and the terms get really bad, assuming they'll consider you at all.I'm looking forward to the fy results, those numbers will tell an interesting story.

biotech billy 13 Jan 2015

more good news! Wow! 2 good RNAs in a row!A good second half of the year for iodine production. Looks like the ship has been stabilised.BB

yancy 22 Dec 2014

Re: RNS Given the endless bad news this company has issued over the year I think this neutral RNS is most welcome.How long the small oilies will continue producing? As long as the oil seeps out of the ground it is worth producing it so it would seem, even if only a few barrels a day in some areas. Wells already drilled have already had the capex spent so as long as on going opex is covered by continued pumping then it worthwhile continuing to produce. It is brand new frack drilling that will be affected where cap ex has not yet been spent.There has been fierce debate about this on a.d.v.f.n. and reading info in some of the provided links suggests that, where capex is already spent, it is profitable to continue to produce oil even if POO falls to less than half of where it is today. Some wells can continue to produce low levels of profitable oil for "decades". That would be very good for us as the same wells will continue to produce brine.Where cap ex has not yet been spent is where I assume final investment decisions will be put on hold. Might affect the mobile units perhaps. If we ever get to hear anything further on those.

nk1999 22 Dec 2014

Re: RNS BB,I think it is very positive in the sense that Iofina has fallen substantially recently on the likely impact of oil price declines on the Shale oil production and hence the brine supply.In the event, this has not materialised and company is confident about no impact next year as well.So IMHO the price fall was unwarranted and well over done.nk

biotech billy 22 Dec 2014

RNS I would describe the RNS as fairly neutral:1.Iodine production continues on target, which is, of course, reassuring.2.Ongoing operations by oil companies that are providing dissolved iodine salts for IOF are continuing, although new activities by these companies will be put on hold, due to the low price of oil. Of course, this doesnt tell us very much because we dont know how long the small oilies will be able to continue producing, as these operations must be barely profitable, if at all.3.We knew that there was a glitch with the water permit application, and the RNS confirms this.I suppose that I should be relieved that there is no new bad news!!BB