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Bl--dy hell this is looking a bit grim now. That Liberium target is close.
We could do with a bit of good news and a few decent sized director buys. I hope we have started to turn things round, with getting that pile of dirt shifted, the bigger lighter trucks coming along, the solar coming on line and that upgraded crusher. What about the new consessions and some good news in Africa? Maybe santa will resolve the court case!
Paul..You can now actually buy shares in Centamin at a discount to their net book value ....
A billionaire could buy Centamin at current prices and inherit almost £200 million in their bank .
Staggeringly low share price, even I recognise that .
By contrast Polymetal shares for example are trading at 400 % of their net book value
Even Hoschild is trading at a premium despite all of their well publicised troubles
Silly to sell at this share price . The markets have over reacted , I will hold until a sensible price re-emerges
inconceivable to think that they will not be a target for takeover at their current price ..the question is how much ..
It doesn't stretch the imagination too much to envisage a private equity firm acquiring the company and its assets , ceasing capex beyond that needed to sustain the business and selling off all of the individual parts of the business which , one would think, should undoubtedly result in a handsome profit , before moving on to the next target.
Just a thought . I hope that doesn't happen but it could
Candid in such a takeover it is likely EMRA ie Government would take control of SUKARI.
I would not be surprised by that, a good investment for them.
That is why no others will touch it,in effect Centamin "The Company" is in reallity just managing the asset.
Centamin is a very difficult and potentialy dangerous target for vultures.
They would fight a t/o with a very powerful ally.
If you take the GBP200 of cash, the NPV of the West Africa projects, (Doropo us$240m, and I would imagine ABC will get similar us$200m), converting all to GBP 200+180+150=GBP 520
Mkt Cap=960
Residual value=share of GBP 440 .... for plant, equipment, + 10 years ore reserves and 8 years ore resources ....(M+I 290 mt 1.05gt Au 9.81m ozs Au)
really? LOL , market knows best
best
the gnome
Hello MrBond with regard to remark that the Egyptian government will take control of Sukari.
Endeavour were prepared to face the risk of government intervention.
Other point I’m interested in, do Centamin have a gold processing plant or is the ore processed by a 3rd party before marketed.
If they process, wouldn’t Barrick Gold be attracted to Cey to obtain a ready operating processing plant probably the only one in Egypt.
The problem with hoping for some sort of buyout, regardless of the discount to NAV, is that the same discussion is taking place on a bunch of other boards. There is consolidation around but it is a buyers market and every shareholder in every precious metal miner is feeling hard done by. Everything is on sale. I sold some CEY a few months ago to top up my HUM and have frankly given up trying to calculate whether it was a decent move or not. Hey both suck right now. It's like discussing which testicle you'd rather cut off. So it's pretty much grit your teeth and tough it out time, while the market flushes. There is unfortunately no reason for a knight in shining armour to buy this one ahead of the few dozen other bargains.
Razors the au at the moment is prcessed in Canada.
But a new proessing plant is about to come to pass ,or planned if my memory serves me right in Marsa Alam.
Good night, will look forward to your morning news
Not quite gnome .. You can ignore cash so Centamin is currently valued at £800 million
The income streams will come from 2 maybe 3 sources .
1. Cash profits from Sukari for remaining life of mine, no further exploration ..just extract known reserves and then either mothball the mine or which is more likely , sell off the untapped gold resources and remaining assets, once all of the current reserves have been depleted
Treating this as a life of mine cash annuity , the following returns are possible
Operating cash for 2020 was around $450 million and for 2019 a bad year was $ 250 million ..go half way so around $ 350 million ( this amount is after corporate admin costs , which could be chopped )
Assume the Egyptian government take around $150 million ( depreciation and other costs would be deducted before profit share allocation , so it would be lower )
So I calculate that the life of mine cash returns will therefore be around $ 2 billion which equates to £ 1.5 billion ..not a bad return from Sukari alone for an £800m outlay
Then there is the West African assets , to be sold as ring fenced entities..your figures suggest £ 330 million ..maybe a little high ...suggest £ 300 million
Finally there is the new exploration rights ..can they be sold? I don't know but if they can they will generate cash
So the minimum cash return will be £ 1.8 billion , possibly more , once you factor everything in,. and this excludes the proceeds from end of project disposal..
Or put another way , twice our current share price.
I don't think it comes as a suprise that the liquidated value of all of Centamins discreet assets will come to more than the sum of its current market value.
Risk factors will have to be discounted , but equally the returns could be higher.
I know that I simplified the equation and that future returns must be discounted for risk , but I think there are more cash generating opportunities that i havent listed here .
What swampmonster is saying is correct , but Sukari has now been well prepared for future production , thanks to the underpinning work , so I can't help thinking that the disposal proceeds from Sukari alone will be significantly higher than the current market value of Centamin as a whole
I agree though , who would take that risk in the current environment , and in the end , the asset is only worth what somebody is prepared to pay for it
My mind is very active today considering various options designed to create maximum share holder value from here at lowest risk .
Using previous example Centamin could dispose of West Africa assets for the £ 300 million mentioned by Goldgnome
These proceeds combined with current cash would total £500 million , which could be used to buy back shares .
Wind down remaining Sukari asset, no further exploration , sell new exploration rights if possible and buy back more shares .
Manage Sukari for cash and distribute proceeds back to remaining shareholders ..same dividend amounts but fewer shareholders receiving them so DPS will be higher
Once depletion of existing reserves has been reached , sell off the remaining footprint with assets and switch the lights off at Centamin !
I am expecting outrage at that suggestion , but that might generate more wealth for us all than the current management are creating now and possibly will in the future ?
Gecko lol
Ooops meant Gekko …