Central Asia Metals Share Discussion Threads

[danieldruff2] 08/5/2013 19:29

I am waiting for the ownership issue of Kounrad to be sorted out, and then I will double up if the price is not too high. I can see this eventually tripling in price and dividend if they build a second processing plant.

[fangorn2] 08/5/2013 18:26

I guess it's because it's

1) A relatively newcomer so not much of a historical record
2) It's a miner
3) It's main commodity is copper
4) It's in Kazakhstan (governance worries such as those at ENRC/Kazakhmys

Suits me though. Will keep nibbling. Decent divi for a miner. And don't see commodities getting that much softer.

[norbert dentressangle] 08/5/2013 18:20

Very strange lack of interest here, on the boards and in the share price. What's spooking the city exactly? The company is hell bent on paying a dividend and at current share price it equates to a decent 6.5%. Proven tech, in profit, masses of reserves equalling $1.6billion in revenue spread over the next 25 years at an approx 80% profit margin. Works out to $50m profit a year on a Mcap of $170m.

What am I missing?

[morph7] 10/4/2013 09:23

Thanks AR,
I missed the minesite article.

[arphillips] 09/4/2013 20:47

Latest minesite article is very positive:



Of particluar note is that there is going to be an update on the acquisition of remaining 40% of Kounrad this quarter and the delay is just frustrating rather than anything sinister.

Also Cannacord have a 245p price target.

[fangorn2] 08/4/2013 12:07

For a legitimate link to CAML report

[vosene] 30/3/2013 07:41

Possible plus for copper prices

[arphillips] 28/3/2013 12:22

From yesterdays results:

" -- CAML Dividend Policy
The CAML Board agreed in early December 2012 to commence the payment of dividends to its shareholders owing to the combination of a strong operational performance at Kounrad during 2012 and the resilient copper price. Whilst the agreed dividend policy was to distribute annually a minimum of 20% of attributable revenue, the Company targeted 30% of the attributable revenue for 2012. The Board also decided that it was appropriate to return some of the savings made arising from the Kounrad project capital programme by way of a special dividend.

A special dividend of 3.7 pence per ordinary share and an interim dividend of 3.3 pence per ordinary share were both announced on 13 December 2012 and paid on 1 February 2013. The Board proposes a final dividend for 2012 of 3.7 pence per ordinary share to be approved at the AGM bringing total dividends to 10.7 pence per ordinary share for the year."

They are, as stated just above, very shareholder focused and believe in rewarding the shareholders. Last year they instigated a share buyback and this was followed by a special and interim dividend.

[king suarez] 28/3/2013 11:56

Interesting...

And they pay a dividend at present? Is this a progressive dividend policy introduced by the BOD or just a one-off?

If they intend to pay dividends going forward as a policy, then I am v interested!

May wait to see how the price settles first as appears to be selling off a little today.

[arphillips] 28/3/2013 10:32

The decision on second plant, which would also produce 10k tonnes, is due later this year. I believe the budgeted cost now stands at $55m and as things stand at the moment all the construction costs would met by cash generated from the existing plant. The first plant was built significantly below their budget and production commenced as expected, was ramped up without any problems and then continued through the very cold winter months. Just a matter of duplicating the proven first plant so there is very little risk here. They have a large cash balance already and being a very low cost producer ($1562 per tonne) are generating some serious cash. So with 100% ownership of Kounrad and a second plant the cash generated would be enormous.

[king suarez] 28/3/2013 09:53

ARP,

Much obliged. That seems a great deal for CAML, I had expected the 40% to cost much more, but 9m shares is very reasonable.

So, if I am correct, they should be hitting 10k tonnes annual copper production this year, with a resource of 600MT that can support a huge mine life.

The plans for a 2nd plant - is this for an additional 10k tonne production, any ideas on cost/funding for this?

Apologies, I know I should DYOR!

KS

[arphillips] 27/3/2013 19:28

Hi KS, the following paragraphs from todays results explain the current state of play on the aquisition

"Acquisition of 40% in Kounrad project

In January 2012 SEC Sary Arka, the JV partner in the Kounrad project announced that SAT Group (CAICC) had won a tender to acquire Sary Arka interest in the Kounrad project.

In January 2012, the Company signed a legally binding agreement with the SAT Group, based in Kazakhstan, for the purchase of the additional 40% of the Kounrad project not currently owned by the Group. The regulatory processes required to transfer the ownership commenced in March 2012 with the submission by the Company and the SAT Group, in conjunction with SEC Sary Arka, of all the required documentation for the first stage of the transaction.

During 2012, the regulatory bodies of the government of the Republic of Kazakhstan approved the transfer of the 40% interest in the project from SEC Sary Arka to the SAT Group (CAICC). The 40% ownership in Kounrad Copper Company LLP was transferred from SEC Sary Arka to the SAT Group (CAICC) in December 2012, however the interest in the SUC and JOA has not yet been transferred. Once this transaction is completed, the transfer to the Group can begin.

The value agreed between the parties for the exchange was a consideration of 8,616,593 ordinary shares in the Company. At the time of agreeing the deal in January 2012 this would have resulted in the SAT Group becoming a 9.1% shareholder in the enlarged Company once the transactions are completed. Due to the Company share buy-back programme this consideration will now result in the SAT Group becoming interested in 9.85% of the voting rights of the enlarged Company once the transactions are completed."

The acquisition appears to be progressing and further news is due in the second quarter. The above states that the interest in the SUC and JOA has yet to be transferred and some clarity on exactly what this entails would be reassuring.

The successful completion of the aquisition in accordance with the existing agreement will be a real game changer as acquiring an extra 66% for the issue of just over 10% more shares. A cracking deal if it completes. This will in turn trigger their expansion plans for building a second plant.

So there is significant potential to increase future earnings if all goes according to plan.

[king suarez] 27/3/2013 18:46

Hi chaps,

This came onto my radar today - can anyone please confirm the cost to CAML to aquire the additional 40% interest in Kounrad? Thanks.

On the face of those results this looks a v promising, well run company. Good to see a BOD that exceed expectations for once! That I like.

Regards,
KS

[fangorn2] 27/3/2013 12:34

Thanks for the presentation link Steve :)
Appreciated. Just listening to ICAP webcast (in case youre interested)

[pimsim] 27/3/2013 09:49

Proper little cash cow.

Interesting to note that if they do raise their interest in Kounrad from 60% to 100% that implies annual attributable revenue rises to around $70m (assuming 10kt/yr * $7000/t).

They have a stated dividend policy to distribute a minimum 20% of attributable revenue so that would imply $14m divi = 10.6p. That would be a rather nice 9% yield....... and that is the minimum distribution, this year of course they are distributing 30% of revenue.

[fangorn2] 27/3/2013 08:28

Just a pity one can't hold it in an ISA frankly.

[nhb] 27/3/2013 08:27

Life of mine 25 years?! That's lot longer than I thought. This thing is going to be printing money for a long time. Must be a long term hold. Only fly in the ointment maybe the price of copper?

No news of doubling production via the extra machinery (I forget the details).

Cheers

[morph7] 27/3/2013 07:45

RNS is out-highlights:
Project revenue of $51.1 million, attributable revenue of $30.7 million (2011: $1.1 million)

· Operating profit of $15.0 million (2011: loss $6.1 million)

· Group profit from continuing operations of $10.3 million after tax (2011: loss $5.9 million)

· Kounrad operations a tier 1 cash cost copper producer

o Direct cash cost of production, $770 per tonne ($0.35/lb)

o C1 cash cost of production, $1,562 per tonne ( $0.71/lb)

o All inclusive cost of production in Kazakhstan, $2,167 per tonne ($0.98/lb)

· Cash and cash equivalents of $33.8 million as at 31 December 2012 (2011: $16.0 million).

· No outstanding debt within the Group

· Interim and special dividend totalling 7.0 pence per share announced on 13 December 2012 and paid on 1 February 2013

· Proposed final dividend of 3.7 pence per share making a total for 2012 of 10.7 pence per share



Operational highlights:

· Completed construction of the Kounrad SX-EW plant for $39 million, $8 million below the original budget

· Total of 6,586 tonnes of copper produced in the first eight months of production

· Kounrad resources now stated in accordance with JORC Standards with over 600,000 tonnes of contained copper as at 27 March 2013 and anticipated Life of Mine in excess of 25 years

· Operations continued throughout the winter period

· Further update on SAT transaction anticipated during Q2 2013

[arphillips] 26/3/2013 18:47

Only two trading days left in March so results had to be imminent. The share price firmed towards the end of the day so I thought tomorrow maybe the day. Is that for definite then? Fingers crossed for some really impressive numbers on profit, dividends and cash.

[morph7] 26/3/2013 17:47

RESULTS DAY TOMORROW!!!!!!!!!!!!!!!!!

[fangorn2] 20/3/2013 14:57

Guess read across sentiment of ENRC , a fellow Kazakh miner...other than that, not alot else from what I've seen to explain today's move.