coldascheese
15 Jan 2016
Re: Decent results Donatron-thanks for the calcs-very interesting. Company seems very well run under what has been difficult circumstances and now seems really to have got their act together.This could really motor this year and if commodities rebound from lows as expected would make a big difference to bottom line and share price.53p would be nice but 79p would be better.
Donatron
15 Jan 2016
Decent results Happy with today's results. Share price had got crazily low, I was starting to wonder if bad news had leaked out ahead of the announcement. Managed to bag the highest top up ahead of the drop (19.6p on 29 December) - typical!We can do some 2015 calcs based on what they've said:Sales price: Interims said rutile price has been hovering around the $800 mark. Q3 says sales for rest of the year will be in line with 2014, which was $818. Call it $810 and split the difference.Costs: $666 per tonne per the Q4s.126k x (810-666) = $18.1m profit. 2015 average FX rate of 1.528 = £11.8mDivide that by the 522m shares and we're looking at about 2.3p EPS, which now puts us on a PE multiple of about 7.6x. Seems quite low to me? This is based on US data, so not directly comparable, but metals and mining has an average of 17.69:[link] based on that, a fair price at the moment would be more like 41p.No mention of a divi (would rather they use the cash to bring forward expansion plans anyway).Super quick calc for next year:Assume they can maintain the Q4 production and even increase it with Gangama. 160k plus Gangama, call it 180k? Assume most of the costs are fixed and therefore costs drop from $666 to about $580.Assume a slight fall in rutile price for next year to $775:$(775 - 580) x 180k = $35.1m profit = £23.4m profit (approx 1.5 FX rate)Divide that by the 522m shares and we're looking at about 4.5p EPS. Multiply by that industry average 17.69 and we get about 79p. Even at a 12x multiple, it's 53.8p.
Fools Like Us
25 Dec 2015
Re: something a'brewing? Yep, Xmas! Have a good day DD.FLU.
donkey derby
25 Nov 2015
something a'brewing? Is something about to happen with this stock with the trades over the last two trading days?
donkey derby
19 Nov 2015
Re: Latest presentation... Sisay would like SRX to break into the Chinese market. He will have an increased production facility when Gangama comes on line end Q2 2016 if all goes according to plan. The SRX rutile is high grade.
Jitter
19 Nov 2015
Latest presentation... [link]
donkey derby
17 Nov 2015
and don't forget PALA that in 2011 Pala offered 30 pence per share valuing the company at £150 million when there were no dry mines, just a dredger which broke down every now and again. The company is now valued at less than £114 million.Since 2011 with Pala's advice the company has changed dramatically. Dry mines with Gangama to come on stream and another dry mine planned.The rutile deposit is world class and huge. 22 pence per share? Pala have increased their stake twice since their 2011 offer of 30 pence per share. Are Pala trying to work a cheap buy out?
donkey derby
17 Nov 2015
Re: Really odd The only way the company can be taken private is if the institutional investors of which there are three are content to see their shares illiquid in a private company which they would not for many reasons including the fact tat there have there own investors to think of let alone their reputation.For Investec to have to adjust not just once but three times in such a short time looks like gross negligence with no news to justify it imo. And do not forget that it was Investec that sold sufficient shares to go below 3% and either Investec or the company itself failed to disclose that fat to the market.Returning to the iis, I suggest that you compare the shareholdings of the iis at the end of 2014 against those disclosed on the company website (see AIM 26 - corporate governance) You will see that Neon Liberty Capital Management have added nigh on a million share since the year end.Don't let them steal your shares!! With production increasing without Gangama and costs under control or reducing it is just a question of time before the company is comfortably profitable. With Gangama coming of stream as you say towards the end of Q2 2016 and provided that the sale price of SRX rutlie does not deteriorate things can only improve further.The stock is imo very cheap.
Donatron
17 Nov 2015
Really odd Hi, apologies to keep posting comments on these analyst price targets. I know they are rarely accurate (particularly on AIM where fundamentals and price are often unrelated), but they are interesting nevertheless. Also there's not an awful lot else to discuss at the moment.Investec today cut it's price target to 25p from 28p. There's a summary here showing how this has changed over time:[link] just find it incredibly weird that these analysts, having been out to visit the site, keep lowering their target prices in quick succession. Normally I would expect an updated note to be the result of an RNS or some information becoming public, but these are all off the back of no news. it's unusual for them to update their targets more than once every few months, so it is incredibly odd that Investec have now cut the target 3 times and by 29% in the past 5 weeks alone.Couple that with Macquarie's target price of 15p and it does make me wonder whether something is going on that we aren't privvy to. If it's not the price of rutile that is dragging these predictions down, the only other thing I can think is that they are worried about the ownership structure and the risk that the company could be taken private.Would love to read some of these notes.
Jitter
17 Nov 2015
Re: Macquarie rating - daft?! Not that I can see Donatron. J.
Donatron
16 Nov 2015
Macquarie rating - daft?! Macquarie have reiterated their underperform rating with a 15p price target. Seems fairly ridiculous to me, I struggle to see how they are arriving at that figure given we know that
roduction should be at the upper end of the estimated range for the year. That is the highest production since 1994.Gangama dry mine is expected to come online in late Q2 2016. That will increase production yet further.Gangama is very low risk - a one year payback period, an after-tax NPV(10%) of $118m and an after-tax IRR of over 50%, fully funded by existing debt facilities and operating cashflow. Construction is already well underway, with equipment being delivered to the site (according to the timeline in the analyst presentation).There's tje option to double the size of Gangama operations within roughly 12 months if market conditions favour the extra capacity.Rutile prices next year should be stable, with a slight increase expected in the second half of the year.The rutile price is expected to properly recover from 2017.All in production costs are set to fall yet further as a result.All I can think is that they think the rutile price is going to fall further but, even so, we are break even all the way down to about $600 at the moment. Few of our competitors can match that, so global supply will reduce to stabilise the price long before we reach that.Am I missing something?
donkey derby
11 Nov 2015
Re: Proactive Investors Interview With Inves... Thank you for these notes; you can get the proactive notes via google by typing in the guy's name. I and other investors think that srx shares are worth a ton more than 28 pence and in any event I have a cynical view of Investec. When it was discovered that Investec were the April sellers whose stock was acquired by Pala and the fact that they went below 3% was not formally announced but they turn up as Nomad I became rightly or wrongly cynical.Imo either you will see increasing profitability in the year ended 31.12.16 partly as a result of the commissioning and operation of the new Gangama nine with the increased chance of a divi which will raise the sp or srx will be taken out by Pala or by a third party at a price acceptable to the other three institutions. If it is the former, it is possible that srx may seek a main listing but before doing so may issue more stock in an attempt to enable Pala to sell more into the market once the sp has gone up.It is interesting that 13.8 million shares changed hands recently but there was no announcement of either Pala or the other three institutions taking those shares. Unless the news was deliberately or negligently suppressed, there is a new holder holding that stock or there was an intercompany arrangement by an existing holder. Views from others would be welcome.
Donatron
11 Nov 2015
Proactive Investors Interview With Investec Interesting interview with the analyst that recently returned from the Sierra Leone visit:[link] like we should expect to see a transformative effect on the SP from late 2016. Hopefully we can hit the heady heights of £1 in 2017, if not before.
Donatron
10 Nov 2015
Re: Investec cut price target to 28p This was definitely a result of the analyst visit, by the way. Still can't read the research note, but it's referenced in this article:[link] here is some of what was written:Analyst Hunter Hillcoat recently visited Sierra Rutile’s operations in Sierra Leone and clearly came away impressed, saying it was a well-established operation, capably run by a good mix of skilled local and expatriate staff.“This gives us comfort in the company’s ability to implement and manage its future production plans,” Hillcoat said.Hillcoat thinks the price of rutile will stabilise in 2016, with things starting to pick up from 2017, as customer demand increases as inventories start to run down.“While longer-term growth will be somewhat reliant on improved market conditions, we have made no changes to our modelled forecasts given that we anticipate a product price recovery from 2017, as market balance is reached,” the broker said, as it reiterated its 'buy' recommendation.“Our NPV reflects the growth potential within the company, incorporating the Gangama project (Phase 1 currently running on-schedule and on-budget, with anticipated first production from 2Q16) and a risked valuation for Sembehun,” Investec said.
Donatron
10 Nov 2015
Record October production It would appear that we've had record production in October. The article seems to be stolen from a DOW Jones Newswire (which is a subscription service that I cannot access), so they only give you the first few lines before taking you to a completely different website that has nothing about Sierra Rutile:[link] it's written by this guy:[link] also writes for the Wall Street Journal:[link]
