|Van Dieman Mines
||EPS - Basic
||Market Cap (m)
Real-Time news about Van Dieman (London Stock Exchange): 0 recent articles
|pugugly: Looks as though the PI's have been well and truely screwed - Company is now effectivly owned by Galena. I suppose it is better than going bust BUT do not expect to see any major recovery in share price.
I strongly suspect we might see a trade sale within the next couple of years subject to resource -
I personally cannot see any reason to prticipate in a fund raising where control is so concentrated.
Annthing else to read between the lines - Personally I worry about why draw down was cancelled|
|chipperfrd: It is only a flash-note:
Following the recent announcement of a Revised Mine Development Plan (see our
note of 16th May), the share price of Van Dieman Mines has experienced a sharp
drop from 10.75p to its current level of 6p.
Despite the undoubtedly bad news, we believe that the recent sell-off is overdone and the current share price now represents an undervaluation of the company by the market. We believe that the previous management did their best to make an essentially simple mining and processing operation overly complicated. However, it looks as though the new Board of Directors has made the necessary personnel changes and are implementing a much more realistic development plan.
The recent developments resulted in an increase in the operational and financing
risks surrounding the Scotia/Endurance projects. For this reason we reduced our
target price to 12p, representing a 60% reduction of our per-share NPV(10%)
valuation. We will gradually reduce this discount as the financing, reserve
modelling, metallurgy and commissioning issues are resolved satisfactorily.
We expect that, once all of the technical issues are resolved, significant capital and operating expenditure savings will result in a more attractive base-case NPV valuation. However, we are not in a position to incorporate any reduced capex/opex estimates into our cash flow model until they are known with
confidence and adequate arrangements for working-capital are secured by the
Due to the recent market action we are maintaining our £0.12 target price and rerating of our recommendation to BUY. We believe our current risk-weighting adequately reflects the uncertainties surrounding the project. Therefore, we believe that the current share price represents an excellent opportunity for the risk-aware investor to gain exposure to a project that should deliver good returns in the medium-term.|
|katylied: Remember, this mine is open-cast. It doesn't require major engineering to get the ore out, just an (industrial sized) bucket&shovel. The scale of the delays so far, are quite baffling (it is ~year now, since they first knew they had a green-flag for production). This current (moving) target for Scotia production looks likely to now coincide, with the licensing of the Endurance mine (unless that has also mysteriously slipped). That in itself, should be worth something on the share-price...|
|varies: I am very interested to read all these comments on the behaviour of the share price as we approach (or so we hope) actual production.
I had a decent holding in TMC where the story was much the same : endless delays and then suddenly all seemed well and the share price quintupled in a few months.
(I was too slow selling, not keeping a sharp enough eye on the price of nickel, but still tripled my money. I wish I could claim to do this often.)
Here too many shareholders must be fed up with the interminable delays and have lost patience leaving only the hardier punters on board and I suggest this accounts for the latest disappointment having so little effect on the price.
We should see a good rise here, relative to the market at least, provided production is not much longer delayed and, of course, that the price of tin holds up.
Fingers crossed !|
You need to do your own research and buy before sentiment changes. The currently very high Tin price gives a good margin for error and it appears that what there is left to do to get into production now rests within their own sphere of influence. So I'm looking forward to some positive newsflow to drive the share price forwards in the not too distant future.
|maddox: Hi Guys,
As a recent joiner I've been reading the RNS, BB etc. It seems to me that considering all the steps necessary to get into production - prospecting, licensing, environmental surveying, permitting etc, etc you have to question whether the so-called 'delays' that have led to the share price fall were not in fact foreseeable. It seems to me that the original timetable was very optimistic to say the least. Any views?
|jonwig: If I've read this correctly, they will have 91.7m (old) + 45.5m (new) = 137.2m shares in issue after the exercise.
Also £6.6m of debt on unknown terms.
The two significant numbers are:
(1) Stage 1 post-tax NPV of A$62m = £24m = 17.5p/sh.
That should be increased because the discount rate in arriving at it should be lower, and the tin price is higher than was incorporated in the calculation (US$ 10,000/t approx).
However, it should be decreased because costs are higher than before (at about US$ 8,000/t) and the debt needs servicing.
So let's say 15p for the share price.
(2) Total resource value of A$1.3bn = £520m.
A post-placing MCap of £13.7m (10p share price assumed) works out at about 2.5% of the resource.
This is amazingly low - 10% would be more normal.
Let's say 5%, giving a projected share price of 20p.
The thing is, even after all the delays and tribulations, there should still be a conservative 50% to 100% potential upside from here.
I've nearly talked myself into buying more of these.
At least I can feel more comfortable just holding.|
|jonwig: Hello, VB, Daz,
thanks for your summaries of the AGM content, etc. Sorry I didn't have chance to meet you or talk at the AGM - I was busy buttonholing directors, then missed my train!
I counted 24 present plus 4 directors - quite a lot!
A few points to add. First, strange that the share price dropped at 1pm (when it finished) yet there were a few buys in the afternoon, maybe based on the statement issued at 1:15, which was pretty positive.
The meeting started with a welcome from Chairman Michael Spriggs followed by a very interesting presentation by MD Clive Trist. This will be put up on the website soon, he said.
One shareholder interrupted here with a comment about the share price, and CT got his retaliation in early ... we're aware that the website and general communication aren't as good as they could be - we're planning an overhaul of the website, etc.
I won't go into detail about the presentation (since it should be available soon), except that he went into more sapphire detail than tin detail! Sapphire seems to be the exciting thing...
He also clarified that the six-year offtake deal with ThaisArco begins with the first shipment, not from the date of signing. (I planned to ask that.)
Tantalum content will be recognised and credited to VDM.
JORC resource figures from other tenements are to be updated, and results published 'shortly'.
From the geological pictures shown, I suspect there will be a considerable uplift here.
There was then a presentation from Neil Kinnane, the Expl & Opps Director. Whilst he knows the ground, knows his workers and knows his job, I don't think he knows what questions shareholders want to ask, or how to answer them.
The elephant in the room was, as already mentioned, the need for further fundraising. CT refused to be drawn on size, but said it was being negotiated, and an announcement would be made in due course.
This is, of course, an ideal time to raise more funds in the market!!
Over coffee, I asked NK about breakeven costs - he didn't seem to spot the urgency of my request, but the figure would probably need to be revised upwards to around $8,000/t. That's not surprising.
I also had a brief talk with Kenan Frey, the Marketing Director. He's also very enthusiastic about sapphire, and seems to be the driving force behind the JV for cutting and marketing. Spinel is on the back-burner at present.
So, it's push/pull...
Positive: the potential (more tin, super-sapphire) is greater than previously thought;
Negative: can they raise needed funds and on terms which won't be too dilutive for existing holders.
My verdict - I'm holding. But the balance is pretty horizontal IMO.|
|katylied: Contrast VDM with TYM. TYM current MktCap = ~£6m. Sitting on a massive tantalum
deposit in Saudi Arabia. Share price actually going up at present. But...
In the last year, TYM has in fact lost its Saudi licence, been suspended
for 6months and had to re-apply for its licence. In any case, no production
was ever planned before 2010 and little cash on the balance-sheet, plus
large future dilution in favour of the Saudi partners...
VDM meanwhile, MktCap = ~£9m (at 10p) and share-price tumbling. Alluvial
tin (and extras) ready to be shipped. Smelter contract in place. Some
cash still on the balance-sheet and mine profitable at ~$7000/ton of
metal, where current mktprice is ~$14,000/ton...
Still, who knows. It is always what you don't
know that gets you. Or is it, what you don't
know that you know, or know what you
don't know (refer Donald Rumsfeld...)...
 VDM MktCap now less than £8m...|
|papalpower: A mention by AinW over at TMF on the "Week that was" post :
..........................Licence of the week
Great news for fans of Van Dieman Mines (VDM), on Wednesday, the company announced that formal approval had been given to kick start its tin-sapphire project in northern Tasmania.
In August 2006, VDM was confidently announcing that production will start in the fourth quarter of 2006:
However in November 2006, VDM shareholders were informed that Tasmania is suffering from a shortage of civil servants, and as a result documentation will not reach the relevant council meeting until February/March 2007.
In fact, the paperwork was not presented to the relevant council until May. Oh, how VDM shareholders laughed, consoling themselves by watching repeats of Dear Minister.
Per 27 February 2007 RNS announcement:
"A six-year contract was signed in July 2005 with tin smelter and refiner, Thaisarco (an Amalgamated Metal Corporation plc subsidiary), for the off-take of the Company's entire tin concentrate output of 1,350-1,500 tonnes contained tin per year at prevailing LME prices. In addition, an agreement has been signed with a well known and highly respected US jewellery and gem stone marketer to market the sapphire production, and the potential market for the spinel gemstone by-product is continuing to be evaluated. The initial marketing for both products is now well advanced and the Company is, following representations at the annual Tucson Gem and Mineral Show in Arizona, USA preparing a release detailing marketing progress."
In December 2006, the directors of VDM announced a project valuation, the result of which shows an after-tax NPV of A$62m (or more precisely in the range of A$53m to A$70m).
Assuming that A$1 = £0.42.
The NPV equates in 'real money' to £26m if we assume A$62m is a 'fair' value.
Current shares in issue 91.6m
As far as I am aware there are no options outstanding.
Share price 15p
Market value - £23m
Not much difference between NPV and market value, but wait, what about the forecast tin price? "The valuation is based on tin price is varied over a ten-year price commencing at US$8,800 in the first year of production and increasing annually in line with price projection contained in the R.T.M. report."
It is my understanding that tin prices are currently a tad higher than US$8,800m but note also costs will also have probably risen as well.
What about cash?
Per the interim accounts for the six months to 30 June 2006, announced on 28 September 2006:
"The directors have prepared profit and cash flow projections for the period to 31
December 2007 which support the view that the group has adequate financial resources to develop the existing properties to the point of profitable production without any need for further fundraising. Although, as with many projects of this nature there remain uncertainties as to the timing and amount of forecast cash flows, the directors have concluded that it is appropriate to prepare the accounts on a going concern basis."
Note the accounts were prepared at a time when production was expected to commence in the last quarter of 2006.
On 20 June 2007, the date formal approval was given, the MD said:
"The delay in proceeding has been aggravated severely by the bureaucratic process, but we have used the additional time to advantage: we have been able to refine the equipment to improve the efficiency, to better define the parameters of the mine operation and to put in place marketing agreements for the tin, sapphires and spinel mine products. We are pleased and relieved finally to have been granted formal approval and we are now in a position to develop the mine site and commence operations."
All very interesting.
Sorry, no forecast PE ratios available.
A share to keep an eye on: results for 2006 need to be released by VDM by the end of play next week.........................|
Van Dieman Mines share price data is direct from the London Stock Exchange