Lonmin Share Discussion Threads

[redbaron10] 13/6/2016 10:11

Don't like Mondays for share dealing,but sold Supergroup and bought more here at 179p. US retail sales and inflation data this week and 10 days to referendum vote.Going to be interesting.

[cudmore] 06/6/2016 13:07

Elvisrocks

Good call on the share price ....NOT! LOL

£2 here we come :)

[harry_david] 06/6/2016 12:49

One other thing, these are a bloody good hedge against Brexit.

[creddy] 06/6/2016 08:01

negative sentiment. daily mail today.

[redbaron10] 05/6/2016 12:01

Well Elvisrocks,sell your lonmin holdings if you have them,then.I'm here for the long term.

[elvisrocks] 05/6/2016 10:31

Redbaron, I'm puzzled as to why this matters for Lonmin.

For the half year, the average Pt price achieved was $905 and on an average XR of 14.84, the weakening Rand almost offsetting the stronger PT price exactly. We'll soon be at Q3 and whilst the Pt average price may be higher - say high 9-hundreds - the ZAR has not weakened any more and may well be unlikely to after avoiding its junk status downgrade last week. Currently, it is about to drop back into the 14's. For Lonmin to make money it needs a higher average PT and a deteriorating ZAR.

Lonmin must triple its half year EBITDA of $36m to break even, currently I don't even seen it doubling. Goldmans and Morgan Stanley talk of its CAPX being cut too far and its current share price supporting a $1200-1300 Pt Price and Deutsche only supporting an NPV of cash flows of 1.0 and a share price of £1.10

To me, I see Lonmin heading back below £1.50 fairly soon, maybe back to the £1.35 area.

[redbaron10] 04/6/2016 16:29

If Yellen makes 'dovish' comments on Monday after that jobs report,and signals a June rise is ruled out,then until the meeting in mid-June ,gold and precious metal prices should rally nicely.If the 'Brexit' leave side get momentum then this will boost the uncertainty as well.Gold $1300oz+ next week?

[redbaron10] 03/6/2016 16:20

Gold up,Pgms up,back in business.

[lazyhisnibs] 03/6/2016 14:29

Credit rating decision on SA this evening.

hxxp://businesstech.co.za/news/finance/125519/south-africa-awaits-credit-rating-decision/

(Extracts:

The general consensus among economists is that South Africa will avoid a downgrade to junk status until at least the end of the year.

S&P and Fitch both rate South African debt one level above junk. S&P, which has a negative outlook on its BBB- assessment, is due to announce whether it will downgrade the rating on June 3, while Fitch hasn’t said when it will announce the outcome of its review.

If the rating is cut “there could be a bit of a shock,” said Malcolm Charles, a portfolio manager at Investec Asset Management. “There’ll be quite a negative reaction from bonds, equities and the currency come Monday morning. It’ll be quite a nasty start to the week.”)

EDIT

S&P didn't downgrade to junk from negative. Fitch could announce in a matter of days but doesn't have a negative on the lowest investment grade.

----------

Also, some articles/vid on wage negations including union manoeuvres in SA's media a few days ago and although not relating to Lonmin directly at least two of the companies mentioned do have PGM assets.

[redbaron10] 03/6/2016 14:25

US non-farm payroll 38k for May.As i'm tired of repeating,the Fed isn't going to raise in June.Ever since the minutes from the last Fed meeting was released, when the Fed indicated a likely rise, then the dollar has strengthened again.This cycle of economic news and the Fed's reaction to it every time is just nuts.Dollar weakening again,gold and platinum up! So what is going to happen next? Who knows.The Federal Reserve certainly doesn't.Frightening when the global economy,oil and commodity prices are in dollars and the Fed dictates where that currency goes.Hope Richard Branson is giving away some free tickets on his space vehicle.Sign me up!

[lazyhisnibs] 01/6/2016 13:44

Commodities bull market in its infancy?

www.cnbc.com/2016/06/01/has-the-bull-market-for-commodities-begun.html

Extracts:

Explaining that the primary reason for investing in commodities should always be inflation hedge, Blanning argues that with the continued printing of money by the world's central banks, there is every reason to argue that higher inflation is coming in the future. "And one way to protect oneself could be through buying commodities."

However, Schroders' Blanning lists three factors that are at play when it comes to falling commodity prices. He argues that while the primary reason for the fall in price was overproduction which was made worse by the availability of cheap credit, the situation is very different today. "With prices down 70-80 percent in many commodities, production is no longer growing."

Furthermore, he blames the dollar bull market from 2011 to 2015 for weak commodity prices. Since most commodities are priced in dollars, it means they became more expensive as the dollar surged, he explained, adding that when the dollar is strong it generally forces foreign central banks to adopt tighter policies in order to support their currencies, which restricts liquidity creation.

---------------------

In SA's media was some analysis about a proposed law regarding land reform which sounds alarmingly wide in scope as first drafted, extensive flexibility for that Government with expropriation for instance.

It perhaps has limited implications for Lonmin even long term given the owners of the land on which Lonmin entirely or largely operates but it won't help with inwards investment and the like.

[cudmore] 27/5/2016 12:26

Keep an eye on TPT. 2 huge buys yesterday. Someone knows something!!

[redbaron10] 26/5/2016 22:30

Why such limited ambition? £2 is a good start.At last this share is becoming expensive to trade now.No more heading for the exit expecting to pick it up on the cheap a week later! If there were a lot of profit-takers after the results,the share price has held up very well.

[bigbigdave] 26/5/2016 12:25

Has had several goes at bashing through 2 quid, has to do it at some point.

[cudmore] 26/5/2016 09:03

£2 here we come

[lazyhisnibs] 23/5/2016 13:47

www.mineweb.com/news/platinum-group-metals/zimbabwes-platinum-industry-calls-2-8bn-new-investment/' target='window'>http://www.mineweb.com/news/platinum-group-metals/zimbabwes-platinum-industry-calls-2-8bn-new-investment/

Headings:

Zimbabwe’s platinum industry calls for $2.8bn in new investment

The country could double annual platinum production in the next decade.

(Extracts:

The southern African nation holds the second largest known reserves of platinum after South Africa but mines have struggled with low prices, a black empowerment law forcing mines to sell more than 50% of the business to locals, and power shortages.

“With vast platinum reserves, the sector has potential to increase production by the current producers from about 13 tonnes (458,562 ounces) to 20 tonnes (705,479 ounces) by 2020 and to 26 tonnes (917,123 ounces) by 2025,” Chitando said.

He did not comment on the separate Russian-backed project which was announced by the two governments 20 months ago for the joint development of the Darwendale mine which was projected to be producing up to 800,000 ounces a year by 2024.)

Also in the article are some comments on Zim's electrical power situation.

If that Country's leaders are able to extract development money out of their BRIC friends or the World Bank then production could be similar to Lonmin's in a few years depending a bit on how many shafts actually get mothballed at the Company.

[edjge2] 20/5/2016 18:49

cudmore,have got cautious on gold myself and expect a fall to 1180. Expect 200p again here soon but drag down likely with gold. Long term I see this beating gold miners as plat overtakes gold. Plat usually more expensive.

[cudmore] 19/5/2016 20:09

Nice big buy at the close.....someone is expecting these to rise (or has cash to burn!)

[lazyhisnibs] 18/5/2016 14:13

In the media.

Three reasons given for the Rand weakening again today being the following:

1) FED / Dollar related although the move seems muted to me.

2) Rumours of ANC infighting which might (or might not) compromise the latest Finance Minister

3) CPI

(Extract from an article re CPI: "The consumer price index (CPI) rose 6.2% year on year in April, from 6.3% in March and 7% in February, Statistics SA said.")

EDIT

From the mineweb article abryer posted:

(Extract: Looking forward to the rest of the year, Lonmin’s CEO Ben Magara believes unit costs for the full year will come in at R10 400/PGM oz. Add to this ongoing capital costs of roughly R900/PGM oz, and the company must reach a cash breakeven cost of R11 300/PGM oz. Since the end of the period, the average platinum price and rand-dollar exchange rate has moved favourably, which suggest the company will enjoy better margins in the second half of the year)

[thomasthetank1] 18/5/2016 12:27

Read AlphaValue's note on LONMIN PLC (LMI), out this morning, by visiting hxxps://www.research-tree.com/company/GB0031192486

"Lonmin’s H1 FY16 (September-ending) results were relatively less disappointing, although the group’s key profitability measures were still negative. H1 sales were up 1.4% yoy to $515m, as 36% higher platinum sales volumes (due to restoration of normal operations at smelters in December 2014) more than offset the impact of the 26% correction in PGM (and by-product) prices. Adjusted operating losses were reduced to $22m (vs. $70m in H1 FY15) as the group achieved 67% of its full-year cost savings target of ZAR700m..."

[brahmsnliszt] 18/5/2016 06:09

Elvis

I know Tom and he's a very well respected analyst in the bullion market. I speak with him every day and he knows his stuff believe me.
Easy to castigate anyone in the city but his yearly forecasts for the lbma over recent times has seen him come first or second place regularly.
Indeed I used to work alongside Tom before he went to credit Suisse and was well liked and respected.
On this you don't know what ur talking about.

[abryer] 17/5/2016 23:21

Worth a read

[elvisrocks] 17/5/2016 21:13

cudmore, you must therefore be up 400% at £2, don't you think to get that extra 100% (50p) you should budget for a pull back to the £1.75 or below area and then get back in, even doing that twice over.

Sounds to me bit like being seated at the winning cards table at the casino and your luck running out at the last hurdle, just as you thought about pulling out.... Remember winners know when to cash out, not hold their luck for ever. £2.50 would be a 50% increase on where we were about 10 days ago on the £1.65 range ....