Alecto Energy Share Discussion Threads

[cpap man] 18/11/2016 16:05

Very good afternoon for ALO +22% so far oilbuy!?!?!

[paleje] 18/11/2016 15:28

Time will tell, Kimboy, I'm not trying to convince you or anyone else just putting an opinion. Incidentally sorry my decimals are out, it should read 0.08 not 0.8:)

Re whether Paternoster and the CEO taking shares at the 0.08 price (about £450k worth for Paternoster) I'd say it's very relevant, Paternoster are in the business of investing in resources, so have some experience in valuing and certainly didn't invest that amount of money if they thought a killing would only come at the end for cronies.

Anyway in or out, good luck if you're waiting till the end, I agree it can work that way sometimes. Have a good weekend one and all.

[kimboy2] 17/11/2016 23:02

Well lets just think about working capital. If they are producing 40k ozs pa then that is a turnover of about £40m pa. How long is the gap between starting to dig the ore production and receiving payment ?

If it is 4 months then ALO need about £13m in working capital just for this. Then there is capital during construction phase, commissioning etc. I would have thought £15m working capital was conservative.

On the capex I think it unlikely that the vendor financing will cover 100% of the costs. That is the implication of the feasibility study on my reading of it.

On Paternoster and whoever taking shares is irrelevant. They all know when the final dilution comes they are going to get all their money back, as long as it goes ahead.

[paleje] 17/11/2016 18:04

I know the system, Kimboy, I don't disagree with you generally I hate spiv placings. I've seen Beaufort and their like do it time and again, lots of co's KIBO and EUA to name a couple of recent ones, both with ok projects but regularly stuffed with obscene placings. But neither of them having capex finalised...that's the difference.

Once capex is confirmed here then the ball game's different. The prospect will be significantly lower risk and I don't think they'll need £15m but whatever they do need is already costed in the NPV. They might want a bit extra while they're at it and that's fine by me.

No need for disproportionate dilution at all but management have to be firm. I remember MJ bought into the last but one placing at 0.8p and Paternoster converted a sizeable loan note at that price too, they thought it was good value but it will be even better with vendor finance in place. It is seriously undervalued currently imo.

[kimboy2] 17/11/2016 14:01

If we ignore the working capital they will need (£15+m?) and the cut the various financiers and advisors will want of Matala (%?) and just look at the numbers.

Regarding funds the current m/cap is £3m and Matala NPV is near £30m after capex.

The current market cap is £3m with 5.2bn shares issued. It could, if the mine gets going and all the financing goes ahead, be worth £15m with 100bn shares in issue. Does that make it a good investment?

There is no good reason to invest till it is fully funded. You can try going in and out of the shres and riding sentiment but that is a guessing game.

The advantage the placees have over ordinary punters is that, though they have lost money on the last placing and couldn't leak them on to the market above the placing price, they have their feet under the table. They will be amongst the favoured few when the last placing comes, as no doubt will be management.

The role of the ordinary punter in all this is to get very excited about potential profits and finance them until they actually start making them, and then get very little reward.

[defcon3] 17/11/2016 12:31

Company issued the rns today as many pi's were contacting them for updates etc.

[kimboy2] 17/11/2016 10:03

I thought it was an OK update. However the problem remains that the share price has nothing to do with how good the mining prospects are and everything to do with the actual financing arrangements.

Noone is going to take the risk and give ALO the upside and the company are elusive about how much they have to raise other than capex. I still fail to see why anyone would want to leave anything on the table for present punters.

I still believe that there will eventually be a highly dilutory cut price fund raising to finance the deal and it will be spread amongst the favoured few.

The time to invest in this is when it is fully financed - as long as the Chinese aren't the majority shareholder.

[paleje] 17/11/2016 09:52

I think they were just filling detail and confirming still best option, stuff they couldn't say in real time especially with politicos and local institutions involved. It's undoubtedly been very difficult for them but the fact that they have revealed a bit of detail suggests to me it's looking more solid.

Interesting reference to other options:-

" We are in the process of transforming Alecto on a number of fronts, and we intend to be far more than simply a small gold producer in one country. Our technical teams have been actively engaged in our joint venture opportunities, as well as reviewing and assisting with other potential business development activities, throughout the last few months. We look forward to providing more details on these activities in due course."

Nothing wrong with a pinch of cynicism though, it's AIM at the end of the day.

[inbrackets] 17/11/2016 09:15

Cynical view maybe, but why issue the update now. Sp has slid again to an ever smaller fraction of a p, and the company bank account must be running dry. By the sounds of it they were hoping the financing would have been sorted out by now which would have lifted the share price and enabled a placing. Now all they can do is tell a story of what might have been. How I would love to be proved wrong.

[cpap man] 17/11/2016 08:10

Broker note on ALO from Beaufort Securities....



Alecto Minerals (ALO.L, 0.06p) – Speculative Buy
Alecto has published an update on the Matala financing situation. By way of background, Alecto has been in advanced discussions since late 1Q with a Chinese group for vendor financing of its flagship gold mine project in Zambia. However, the process has taken longer to complete, partly due to a new Zambian president and partly due to the slow and cautious investing process of the Chinese side. Today's update says that a key step has been achieved in that process, with the Zambian government allowing the lender security over the Matala asset, which makes risk insurance available. The next step involves finding a local "institution" to on-lend the Chinese funds (the institution needs to be guaranteed -presumably to protect against the funds disappearing). Once step 2 is in place Alecto management expect to close financing and break ground in 1Q17.

Our view: Management and investors are having to remain patient here. While some onlookers may question whether the Chinese funding will ever arrive, these are real entities spending time and money on this process. Note also that management and its partners have experience successfully sourcing mine finance from China. Although not guaranteed, we believe the Chinese funding will come through.

Beaufort Securities acts as corporate broker to Alecto Minerals plc

[oilbuy] 17/11/2016 08:09

Market seems happy with that RNS

[cpap man] 17/11/2016 08:00

Mark Jones, Alecto CEO, commented:



"We made very rapid progress with our Chinese funding partners at the beginning of this year, and it is regretful that we have subsequently been unable to meet our original timeline for completion. However, the external factors outside of our control have required us to exercise patience as we seek to close the financing.



"The Company, and our partners, are very excited about what will be a true Zambian gold mining success story, and we are fully committed to ensuring that it happens. Due to our size, satisfying potential financiers of the merits of taking on project risk has not been without its challenges, and progress has been slower than we would have wished. However, our commitment to the process is undimmed and we continue to believe that bringing Matala in to production is the best way to realise value for shareholders.



"We are in the process of transforming Alecto on a number of fronts, and we intend to be far more than simply a small gold producer in one country. Our technical teams have been actively engaged in our joint venture opportunities, as well as reviewing and assisting with other potential business development activities, throughout the last few months. We look forward to providing more details on these activities in due course.



"I would like to personally thank our shareholders for their patience during these difficult times, and reconfirm my commitment to building Alecto into an important player in the African gold and base metals market."

[spazzz] 17/11/2016 07:50

Yep - pretty decent update.

[michaelfenton] 17/11/2016 07:48

At last an RNS on funding which appears to show all is still on track and includes a plausible explanation for the delays. So fingers still crossed for production sometime in 2017.

[citycanary] 16/11/2016 16:09

I think most people lost patience a long time ago. Appreciate that the MMs make their money on volume and margin but their 'expert games' to keep dropping the share price 15% and raising it 10% are losing a lot of people i.e. buyer fatigue :-)! Think they're gonna have to spike this price pretty soon in order to get the pump 'n' dump brigade and then hopefully try to trap a few in. Makes yer glad to play in this unregulated casino...oops I mean AIM :-)!!

GL to all (we need it here...)

[michaelfenton] 16/11/2016 10:12

Agree oilbuy but people are losing patience? We need news on funding/

[oilbuy] 16/11/2016 08:27

Stock is oversold

[loverat] 11/11/2016 09:22

I've seen this on so many stocks lately. A fall to near all time lows followed by a sudden spike. Loads of stocks in similar mode and some good opportunities.

[knicol46] 11/11/2016 09:16

sp +13% coming alive, leak?

[paleje] 10/11/2016 16:22

It looks as if Alstom is getting crossed with ALO, don't know why it's suddenly started happening.

[paleje] 10/11/2016 16:18

Waldron,

I'm sure you're posting in good faith but the bb you're posting on has the wrong epic ALO, which is why so few Alstom posters use it.

Any chance you could use the Alstom bb for your info which, from the look of it, will be of interest to Alstom holders....but not ALO Alecto holders:)

[waldron] 10/11/2016 06:40

PARIS--Train maker and Amtrak supplier Alstom SA (ALO.FR) considered Donald Trump's victory in the U.S. presidential race could be good news for rolling-stock companies in the light of the promises the Republican candidate made to upgrade the country's infrastructure.

The French company, best known for its TGV high-speed trains, secured a 1.8 billion euro ($2.0 billion) contract to supply the U.S. rail operator in August. Alstom's competitors include Canada's Bombardier (BBD.A.T) as well as South Korean, Japanese and Chinese train manufacturers.

"It is early to tell, but Donald Trump was mentioning huge investments in infrastructure," Henri Poupart-Lafarge told analysts in a conference call held on Wednesday shortly after the confirmation of Mr. Trump's surprise victory.the U.S. election were made public.

Alstom, now focused on making trains after selling most of its energy assets to General Electric Co. (GE), said the company currently doesn't sell much in the U.S. while most of what it does is manufactured locally, Mr. Poupart-Lafarge said.

Such so-call natural hedging protects Alstom from any gyrations in the value of the U.S. dollar which some analysts say could prove to be volatile under a Trump presidency.



Wrtie to Inti Landauro to [e-mail]



(END) Dow Jones Newswires

November 09, 2016 18:24 ET (23:24 GMT)

[paleje] 08/11/2016 15:21

All not lost here at all Bill, but they want supplier finance if poss rather than convertible loans or worse; as someone else posted getting sensible finance for small scale projects is a nightmare. Well done on reducing pre RNS.

[sea7] 08/11/2016 10:35

"FFS you guys can be a real miserable load of cretins"

Ha Ha, yep maybe bill, however, its a parting shot!! No more need be said.