Anglo Asian Mining Share Discussion Threads

[jbravo2] 17/9/2018 16:52

So there we go.
Now only one days trading before the interims and dividend news.
Normally we'd see a small dip tomorrow after the news but with us trading as a dividend paying company after tomorrow perhaps not?

Bets on tomorrows closing SP?

52p here.

[crazycoops] 17/9/2018 16:52

Terropol, the problem with that note is that, iirc, it did not update forecasts for revenue, net profit, eps or divi (which is what the data feeds reference) which are currently still showing as $90m, $6.2m, $0.008 and nil, respectively (these are the 2018 numbers). I agree that the narrative was better in that note and the analyst grasped much of the investment case but house brokers play an important role in forecast data for small caps and the forecast data is wrong for AAZ. The house broker should have fixed that, within the system.This said, I am happy to drop it (I was responding to a point made by another poster) as we will have an updated note over the next week or two.

[return_of_the_apeman] 17/9/2018 16:38

Hi jbravo2,

Thanks, it was the quote stating encouraging results from the samples that seemed new to me, which telegraphs that the geochemical results will be good.

Cheers

[jbravo2] 17/9/2018 16:22

@rota
Ordubad. The IPO docs big beast.


Another example of things moving on apace on many fronts

The company is planning to collect 5,000 surface grab samples over the alteration zone as well as mobilising a drilling rig for Q4/18 to test identified targets. The company is seeing if a team from the Nat Hist Museum in London can help out with a research group for collection and interpretation too. Contacts everywhere!
Aiming to have geochemistry results and research group results before YE18.

Ordubad is definitely moving up in priority with an eye to expansion for the future. Aim for a number of targets to follow up on which may potentially convert into a major standalone copper/gold operation.
Ordubad is within spitting distance of three other operating mines in Iran and Armenia underscoring the areas prospects.

[terropol] 17/9/2018 16:15

CRAZYCOOPS, Can you please stop calling the Brokers....They are doing a good and correct job.

Here it is for your info.


Anglo Asian Mining* (AAZ LN) – Earnings/valuation update and site visit notes

45p (last Friday close), Mkt Cap £51m

BUY – 84p (from 77p)

CLICK FOR PDF

We provide updated earnings and production estimates along with notes from our latest site visit to Gedabek operations in western Azerbaijan.
The Company hosted a site visit to its flagship Gedabek gold/copper production facilities this summer outlining the amount of work completed to date to establish a robust base for sustainable operation and highlighting expansion potential within a portfolio of 1,926km2 of wholly owned highly prospective licenses in Azerbaijan.
Gold/copper production is set to grow to 70koz/2.3kt (+17%/16%) and 83koz/4.1kt (+19%/75%) in 2018 and 2019 on our estimates, respectively, now that second crusher is in place and in operation.
Operations benefit from a low cost jurisdiction with the plant drawing power from the national grid and Ugur oxide ores blend offering spectacular cost savings on mining, milling and reagents; additionally, a number of operational improvements identified and implemented including in-pit blasting, mine-site logistics and maintenance works contribute to the bottom AISC quartile status of operations; AISC18 and AISC19 are estimated at $530/oz and $547/oz (incl PSA) v $604/oz in 2017 on stronger production rates and driving robust 42/41% EBITDA margins;
Underground development lays the infrastructure to accelerate exploration works with both Gadir and Gedabek orebodies offering resource expansion potential.
On the exploration front, good news flow is expected through the rest of the year including a resources/reserves update at the Gedabek open pit (September), resources/reserves review at the Ugur open pit (YE18), maiden resources/reserves at Gadir underground (YE18), drilling results from a 40,000m FY18 exploration programme testing extensions of existing orebodies as well as new targets which potentially could be a part of one big system, airborne geophysics study over the 300km2 Gedabek license and exploration programme results from the 462km2 Ordubad license where a research group specialising in copper porphyry systems are due to arrive later this year and help with the data collection/interpretation.
Forecast strong FCFs (FY18/19e: $31m/$27m) with the balance sheet having already been declared net debt free (as of Sep/18) setting the scene for maiden dividend programme as well as providing capital to grow the business both organically (FY18/20 exploration budget is a multiple of previous years) as well as through potential value accretive acquisitions.
At 45 per share Anglo Asian trades at a 46-47% discount to our NPV(8%DR) estimates and market valuation multiples of 83p and 85p, respectively. Given production growth forecasts, strong FCF generation profile, to be shortly announced dividend programme as well as exciting exploration potential, we believe current share price offers good entry opportunity and reiterate our BUY recommendation with an 84p target price (up from 77p).

(Dec year end)



2014

2015

2016

2017

2018E

2019E

2020E

Gold price

US$/oz

1,267

1,161

1,253

1,261

1,276

1,300

1,350

Copper price

$/t

6,828

5,505

4,872

6,196

6,804

7,000

7,500

Gold production

koz

60.3

72.0

65.4

59.6

70.0

83.0

79.1

Copper production

kt

0.8

1.0

1.9

2.0

2.3

4.1

4.1

GE production

koz

65.0

77.0

75.2

71.6

84.9

107.7

104.3

AISC (incl PSA, reported)

US$/oz

1,050

858

616

604

530

547

550

Revenue

US$m

68.0

78.1

79.2

71.8

90.9

118.4

119.2

EBITDA

US$m

10.1

18.7

33.7

32.0

38.5

48.9

49.0

FCF

US$m

-6.9

3.4

14.6

16.3

31.0

26.8

29.4

EV/EBITDA

x

7.7

3.1

1.7

1.7

1.8

1.4

1.4

PER

x

-

-

5.5

13.9

10.0

7.1

4.8

Net Debt

US$m

52.4

49.0

34.6

18.1

-12.9

-39.7

-69.2

Source: share price Angel, Company (AAZ price of 45p used for multiples in the table)

*SP Angel act as Nomad and broker to Anglo Asian Mining



Analysts

Sergey Raevskiy – 0203 470 0474

[return_of_the_apeman] 17/9/2018 16:11

Not sure if this has been posted

hXXp://www.proactiveinvestors.co.uk/companies/news/205001%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20/anglo-asians-exploration-work-set-to-boost-mine-life-at-gedabek-205001.html

(replace XX with tt)

Hadn't seen the encouraged statement below elsewhere - unless I missed it

"In addition, our Ordubad contract area continues to provide significant upside potential for Anglo Asian and we are encouraged by the results derived from the geochemical sampling programme underway.”

[jbravo2] 17/9/2018 16:09

Well its in your hands bozzy.
People say its the waiting, the lack of patience that is the downfall of most. I'm not so sure. There are so many dross small companies nowadays that the picking can be just as difficult IMO.
But you've found the right stock, so that is one problem out the way. The sitting waiting is actually easier IMO.

I mean come on, I challenge myself every now and then to come up with a list of why this won't be materially higher in 12 months and then if I was to sell where else I'd put the money.

Result: been sitting tight and don't regret it one bit.

[lefrene] 17/9/2018 16:00

I like the fact that they still continue to think and operate to make the most efficient use of capital, when so often when things come right there's a tendency towards hubris and wasting cash. There's a rare intelligence and practicality evident in the management of this company, it deserves recognition, and yet so far their achievements go unrecognised and unsung.

[bozzy_s] 17/9/2018 15:58

Online sell limit 75,000 shares @ 49.3p

That's the best I've ever seen from AAZ.

Happy days :)

Bring on Wednesday and a 6-month net profit of around £10m. Q3 trading update which should show a slight increase in production from H1. A first ever dividend. And hopefully on course for £20m net profit for 2018. Trading on a P/E of under 3. Yielding somewhere between 4% and 8% at today's purchase price - we'll find out soon. Backed by top-spec equipment, cash on the balance sheet, little or no debt, a tailings pile worth ~20p per share.

Every message board on ADVFN has holders predicting a life-changing target share price. In the case of AAZ targets of £1.50, £2, £2.50 are backed up by tangible assets, long-running profitability, and the discovery of new gold. 90g/t is absolutely ridiculous. Small cap explorers seem to jump by 20% 30% 50% even 100% when they discover new gold at 1 or 2 g/t.

I had intended to trade the AAZ I bought recently (42p-43p), selling on Wednesday when the price spikes. However I have reassessed after today's news. This is bigger than the maiden dividend. This is bigger than moving from net debt to net cash. This is the number one thing on most people's lists of potential catalysts to lift AAZ's market valuation.

Happy happy days. And real congratulations to Mattjos and others who held tight from 5p. Hope I'm as restrained if/when we multi-bag from here!

This is the 3rd potential life-changing stock I've held. I made the mistake of selling early OCZ Technology (bought 5p, sold 10p the next week, listed on NASDAQ and went to $9.50, equal to 605p, 2 years later. Then went bust, now worth zero). And LOQ, bought at ~30p, sold at ~50p, now 9 years on they're 2830p renamed as ACSO.

Hoping it's 3rd time lucky with AAZ :)

[bleepy] 17/9/2018 14:54

Jb

Thanks for extra info, demonstrates as always a keen cost saving initiative alongside a 10%+ increase in revenue per new concentrate sales agreement.

[bleepy] 17/9/2018 14:48

H1 2018 EXPLORATION ACTIVITY AND RESULTS

Page 13.
Given the current positions of drilling and the recent discoveries of additional mineralisation on the flanks of the Gadir orebody, four distinct target areas have been defined for future exploration activity (see drawing on p13).

Areas to be assessed by future drilling:
1. Down dip extension of Gadir
2. Western strike extension of Gadir
3. Mineralisation between Gadir and Gedabek
4. Area between the two Gedabek zones


From viewing the pics on p13 of exploration pdf the above areas are substantive and bodes well for ongoing exploration and mine life. These areas being adjacent to mine process plant.

[mad foetus] 17/9/2018 14:36

No shortage on offer at 50.5

[brasso3] 17/9/2018 14:06

It will be nice to get the JORC resource back in the 1m - 1.5m oz range. Hopefully that is where we will be in 2 weeks time.

[jbravo2] 17/9/2018 14:05

The company is making many steps forward. Sure we knew about the big stuff such as the exploration program.
Heres a couple of other snippets.

Who knew about the new road to cut down travelling time/cost for moving ore on site? Also uses 750kt of waste rather than sending to the tailings.
Nice.

The company is trying out a new concentrate sales agreement which offers improved commercial terms for its copper/gold concentrate. The new offtaker is paying 90% for contained copper and 92% for contained gold (previously 84% and 80%)
Nice.

[return_of_the_apeman] 17/9/2018 12:47

Thanks crazycoops, you are right one feeds the other.

I share your frustration as screening companies for new investments is time consuming and it is nice to have quant tools like stocko to cut down the list. It is a shame the figures are so far out as I believe many investors would begin to research this company if the figures were correct and it stood out like a very sore thumb

Although SPA have started sharpening their pencil, they have yet to dust of the abacus. Frankly, I doubt they will do this until the next qtr even though I am secretly hoping they will do so following the results on Weds as they seem to be hinting

[bumpa33] 17/9/2018 12:42

Peel Hunt had the seller, as of this morning they still had him.

I’d guess this PR push and news flow may partly be to facilitate clearing them. They are not an aggressive seller which is good obviously. Hopefully with everything coming up they will be cleared soon enough.

[s0lis] 17/9/2018 12:18

I like the RNS comment by Stephen Westhead " reserves and FUTURE MINES in as short timeframe as possible".

Is he keeping something back ?

[lefrene] 17/9/2018 12:06

I guess whoever has been feeding the market at 44p is now feeding it at 48p? At what time will they shake it back, before or after lunch? :¬)

[terropol] 17/9/2018 12:03

Relax guys...it will all come right.
It gives a lot of us time to find more cash to invest here....

[lefrene] 17/9/2018 11:53

crazycoops, AAZ is so badly served by the UK market that it might be worth the trouble to see if they can list on the TSX. The news today should have sent this into orbit, this is £2 coins going for 50p, and we haven't got to the Wednesday news yet.

[crazycoops] 17/9/2018 11:45

RotA, it is not Stockpoedia's forecasts that are out of date per se but rather, share price Angel have not formally updated their earnings forecasts. This will be corrected soon (according to today's note), whether that is post results or perhaps once the updated JORC is published, I don't know. It has been a source of frustration for me for some time now and it is simply not good enough from the house broker. Who gives a flying fig about their price target? I don't. It is the forecast data they should be doing a better job with (among other things).

[bleepy] 17/9/2018 10:57

UGUR DEPOSIT

The deposit is currently being mined and exploration activity has focused to assess potential extensions to the deposit.

Exploration activity in H1 2018
• 5 core drill holes with a total length of 2,274 metres.
• 120 linear metres trench sampling.
• 505 outcrop samples.
• 28,000 square metres of lithological-alteration-structural mapping.

One drill-hole, drill-hole number UGDD51 that was drilled to the South of the Ugur mine intersected high grade copper and silver mineralisation. The depth of the mineralisation was from 301.85 metres to 310.25 metres (thickness 8.4 metres) with average grade of 1.15 per cent. copper and 123.5 grammes per tonne silver. This indicates the presence of deeper mineralisation, however the orientation is unknown. This is one of the target areas to be assessed further to the planned airborne geophysics programme scheduled for Q3/Q4 of 2018.
Drill hole locations and core photo of the UGDD51 is shown below.
Surface exploration work continues about the Ugur deposit comprising geological mapping, surface sampling, trenching, however airborne and surface geophysics is planned to assess the deeper potential.


They have even taken samples and carried out trenching along the Ugur haul road leaving no stone unturned...

Ugur Surroundings
During the construction of the haul road to Ugur, fresh rock was exposed. Strong hydrothermal alteration and brecciation is observed in the road cuttings approaching the Ugur mine. Hydrothermal alteration mainly consists of argillic and strong oxidation types. Some 505 samples were taken from these alteration zones, and 120 linear metres trenching was carried out. Exploration continues.

[terropol] 17/9/2018 10:48

NOTE BROKERS TARGET UP TO 84P from 77p.

[jbravo2] 17/9/2018 10:48

Blimey, even SPAngel have woken up
:D

It's hard not to when you're the best ranked miner in the whole market :)