Anglo Pacific Share Discussion Threads

[quepassa] 27/11/2015 09:41

The CEO bought 20,000 shares at 63.5p.

That is an amount of £12,700.

Not a great amount of shares in the scheme of things in my view.

Some may or may not view it as surprising just how few shares were bought based on yesterday's RNS.

The Chief Financial Officer also bought 7,500 shares at 65p. That amounts to £4,875.

Is that a lot?



ALL IMO> DYOR.
QP.

[christh] 27/11/2015 08:19

directors have been piling up shares.

[bolador] 26/11/2015 12:58

Rio application for extension of Kestrel coal mine.
Those concerned about permissions and potential closure of mine might want to read todays update from APF where "legalese" is explained in full. No effect is expected upon royalty income from Kestrel. In addition federal government of Queensland hold by far the greater part of the Kestrel royalty shared with APF which royalty rate is set by government and it is unlikely to want cancellation.

[bolador] 26/11/2015 12:18

EdmondJ

APF has a TSX quote. Holders across the pond could sell this stock to realise a tax loss before year end.
I always suspected that the 4p dividend was part of the financing package for the Narrabri deal and that the dividend will now be revised down, but its just my guess.
With about 169 million shares in issue and assets of 161 million the nav is looking like 95p. If you believe the valuations that is. A forty per cent discount to nav would give a share price of 57p.Rough and ready!

[deanroberthunt] 26/11/2015 11:58

could easily halve from here with that update and still not be cheap.

[deanroberthunt] 26/11/2015 11:57

Very poor performance here, someone needs to walk.

[edmondj] 26/11/2015 10:24

bolador,

Still nearly 70,000 sales apparently on the bid price, versus circa 8,500 buys, that's what I meant - in reaction to what initially appears 'good news'.

I've been stalled by the whopping increase in dividend (as one might expect when a financier gets control of an asset/royalty type business) which doesn't look prudent in cyclical context. Que Pasa builds a good argument above, on this and other issues.

[quepassa] 26/11/2015 10:17

1. The net assets of the Company have fallen by some £10m in Q3 from £171 million to £161.4 million.

That's worrying in my view when certain investments appear to have been valued higher. And that fall in the net asset base of the Company has occured in just three months. What has caused the reduction of some £10m of the Company's net assets?

2. Borrowings have gone up a lot in three months from sterling £2.6m to sterling £8.6million. I can trace no evidence in the RNS that this money has been spent on buying further royalties.

It may or may not be that the more-than-tripling of borrowings have contributed to the fall in the net asset value.

Servicing interest and paying back principal on loans is -and will be- a not insignificant burden on their cash resources, especially when APF have such an onerous ongoing dividend policy.


3. Particularly noteworthy is that royalty related income for the full 9 months YTD is just £5.7m. That is not a sign in my view of particularly buoyant royalty receipts.

It should be noted that APF have some 170m shares in issue. If they stick to their 8p dividend policy, they will need royalty-related income of £13.52m for the full year (170m x 8p) to cover the dividend in the current year. That's before interest, salary, office/rent/sundry payments and other outgoings.

If they received royalty income of £5.7m in nine months, how likely is it that Q4 alone can deliver the necessary balance of £7.82m to cover in full any prospective 8p dividend?

In my opinion only , that would seem unlikely which again would mean that any prospective 8p dividend for the current full year cannot be covered in full out of royalty related income.

4. It is noted that Rio have applied for a mining license extension at Kestrel. It is particularly disconcerting in my opinion that Rio have apparently said they will close the mine if the license extension is not approved.

5. No mention of the purchase in the RNS of any new royalties



Increased debt, tighter cash position, reduced net assets, little prospect in my view only of covering in full any prospective 8p dividend for 2015 from royalty income.

This does not look like a particularly rosy picture to me.


ALL IMO. DYOR.
QP

[christh] 26/11/2015 09:54

Events for Today
---------------------------------------------------------
ECONOMIC EVENTS
EU Forecast Previous
09:00 M3 Money Supply y/y 4.90% 4.90%
09:00 Private Loans y/y 1.20% 1.10%
12:00 GfK German Consumer Climate 9.2 9.4
JP Forecast Previous
23:30 Household Spending y/y 0.00% -0.40%
23:30 Tokyo Core CPI y/y -0.10% -0.20%
23:30 National Core CPI y/y -0.10% -0.10%
23:30 Unemployment Rate 3.40% 3.40%

COMPANY EVENTS

Ex-Dividends
Renold [32ID]
3i Infrastructure Ltd [3IN]
Amec Foster Wheeler PLC [AMFW]
Anglo Pacific Group PLC [APF]
Atkins (W S) PLC [ATK]
Castings PLC [CGS]
Custodian Reit Plc Ord 1p [CREI]
CVS Group PLC [CVSG]
Downing Planned Exit VCT 2 D Shares [DP2D]
Downing Planned Exit VCT 3 D Shares [DP3D]
Diploma PLC [DPLM]
Ecclesiastical Insurance Office plc [ELLA]
Euromoney Institutional Investor PLC [ERM]
Volution Group Plc [FAN]
Foresight 2 Vct Plc [FTNI]
Ground Rents Income Trust [GRIO]
HICL Infrastructure Co Ltd [HICL]
JPMorgan Japanese Investment Trust Plc [JFJ]
JPMorgan Income & Growth Investment Trust [JIGI]
JPMorgan Income & Growth IT Plc [JIGU]
Juridica Investments Ltd [JIL]
John Laing Environmental Assets Group [JLEN]
JPMorgan Elect PLC Managed Growth SHS [JPE]
JPMorgan Elect PLC Managed Income [JPEI]
McKay Securities PLC [MCKS]
National Grid PLC [NG.]
Nottingham Building Society 7 7/8% [NOTP]
Northern Venture Trust Plc [NVT]
Princess Private Equity Holding Ltd [PEY]
Personal Group Holdings PLC [PGH]
Rapidcloud International Plc [RCI]
R.E.A.Holdings PLC 9% Pref [RE.B]
SABMiller PLC [SAB]
Safeland PLC [SAF]
Scottish American Investment Company Plc [SCAM]
St Ives PLC [SIV]
Standard Life Equity Income Trust [SLET]
Smart (J) & Co (Contractors) PLC [SMJ]
Utilico Emerging Markets Ltd [UEM]
Utilitywise [UTW]
Walker Crips Group PLC [WCW]
Wynnstay Properties PLC [WSP]
Worldwide Healthcare Trust PLC [WWH]
Young & Co's Brewery PLC [YNGN]

AGM / EGMs
Invista European Real Estate Trust [IERE]
Jsc Kazmunaigas Exploration Production Gdr (each Repr 1/6 Cmn)(144a) [KMGA]
Thor Mining PLC [THR]

Trading Statements
Anglo Pacific Group PLC [APF]

Interim Results
Public Power Corp S.a. [AG40]
Arrow Global Group [ARW]
Charles Stanley Group PLC [CAY]
First Property Group PLC [FPO]
Helical Bar PLC [HLCL]
LondonMetric Property [LMP]
PayPoint PLC [PAY]
Severn Trent PLC [SVT]
Torotrak PLC [TRK]

Final Results
Marston's PLC [MARS]

[bolador] 26/11/2015 09:17

EdmondJ

The stock is xd 4pence this morning.

[edmondj] 26/11/2015 08:38

Another chance for Mr Treger to average down, as selling resumes...

[christh] 26/11/2015 07:32

Results from investments are excellent,Will grow even bigger next year.
Dividend is covered so from now on should see a higher dividend year upon year.
Besides the commodity prices will not remain low forever.

[buywell3] 26/11/2015 00:47

The fundamentals for commodities remain poor

Those who have been buyers at recent(last 6 months) lower prices have not read up on charts

Prices can go lower still

[quepassa] 25/11/2015 12:02

Let's see whether APF offer any earnings guidance tomorrow in addition to the normal output guidance.

ALL IMO. DYOR.
QP

[rcturner2] 20/11/2015 14:52

The thing is at that point it would have been an ideal time to rebase the dividend by reducing it in proportion to the new shares issued. Instead they have committed themselves to what seems to me to be an unaffordable dividend over a much larger number of shares.

[bolador] 19/11/2015 16:45

RCTurner2,
Thanks. You are right about the placing in Feb 2015.Forty nine million and a bit shares were placed at 80p thus expanding the number of shares in issue by 42.4 % prior to the placing !

[rcturner2] 19/11/2015 14:50

A very good summary bolador. It is probably worth mentioning that the new board bought the second Australian coal royalty with a very large placing at 80p, which in my opinion was deliberately to try and underpin the share price, that move could almost be considered as a merger or takeover of another company.

[bolador] 19/11/2015 09:01

deahroberthunt

It is all a long time ago but APF was I think spun out of the old Anglovaal gold mining company.APF started out with a mixed bag of assets including a marble mine in Scotland and a talc deposit also in the far north. I visited the marble operation, wonderful blue and white stone. The magic ingredient however was the royalty on two coking coal Australian coal mines which was shared with the government of Queensland.
The mines were operated by Rio Tinto. It was not possible for APF to have a more blue chip set of partners.
As the Chinese commodity boom got underway price of coal used for making steel went on a steep climb. The government of Queensland raised the royalty rate several times over the years. APF had no part of setting the rate but enjoyed the rise in exact proportion.As the price of coal went up so did the royalty stream and most importantly for the nav of APF so did the capitalised value of the royalties. In time the smaller royalty mine became worked out but Kestrel is still very much in play.
It was as one very involved in the company told me "like being your own Chancellor".
In 2011 the latest commodity boom came to an end and the process of rising royalty streams and rising capital values went into reverse.The substantial revenues, after good dividends had been paid,turned out to not have been invested so well all being in the now fast falling mining sector. The management was changed and a new narrative has begun with the purchase of another coal royalty at what the directors must have considered to be the bottom of the current downturn.Time will tell but the new CEO is heavily invested in the shares personally which is always good to see.
The story of the share price illustrates the history vividly rising from less then ten pence to over 350p and down to 70p today.
In short the process that sent APF to the heights went into reverse in 2011 with the added headwind of the anti coal lobby to reckon with.
I know of no one who has been the full trip up and down but it has been a classic mining story to follow.The above is very abbreviated and from memory, but all the detail is available on line.

[quepassa] 18/11/2015 19:31

they bet the farm on black.


all imo. dyor.
qp

[deanroberthunt] 18/11/2015 19:11

this was a good solid stock once where did it all go wrong.

[bolador] 18/11/2015 10:11

Ref QP/RCTurner re your comments as to APF sector status.

From all companies listed on the LSE.

APF. Group/1775 Sector/Mining Sub Sector/General Mining. Standard Listing.

and elsewhere,

According to APF net present value of Salamanca taken as US871.3m, company equity stake in project 16.7%.We need further advice on this from company, will ask after latest update if not included. Hopefully will be advised further on stated increase in carry value of one per cent royalty.

And in passing,
APF has Toronto quote, year end tax loss selling may have influence on stock price.

[rcturner2] 18/11/2015 07:57

donk, I think part of the problem is that the entire asset portfolio is dominated by two Australian coal royalties, the rest don't really add much. APF is pretty much a pure play on Australian coal.

[donk4] 17/11/2015 21:16

I have never looked at APF before but Julian Treger comes well recommended by an executive in the business who I know pretty well although that executive is not invested in APF.

The interest that APF has in Berkeley looks very interesting but will not come to fruition for some time so I value that at its market price.

I can see why you are critical of the royalty income from the coal investments but I cannot see you monitoring APF as an investor in the company. Therefore you have you have nothing better to do for some reason to monitor it than pass your time.

Hving said that and since you pear to be a critique, given the investments that the company has other than coal, at what entry price might you hypothetically be interested in buying APF stock if you were in a position or desirous to do so?