Anglo Pacific Share Discussion Threads

[cocopah] 10/8/2021 14:45

#LLB Thanks for your usual balanced and informative post. I guess that whilst many things are influencing the share price, probably the dominant one is the market being convinced that the income goals will be achieved (after a couple of disappointing quarters) as we change focus. I agree Q3 will be definitive in this regard. Certainly the price of the commodities that we are invested in are very positive, it’s now about execution.

[illiswilgig] 10/8/2021 14:10

Patience is not a virtue. She's a very harsh mistress, or master, or non-gender binary disciplinarian depending.......

Thanks for your input LLB very useful to remind us of those royalty steps on Kestrel - we should be 15% territory now. Quite remarkable.

Feel I will probably add some as well. Just got to decide what to sell first.

cheers

[the deacon] 10/8/2021 14:03

Agree with you. I've added some today.

[laurence llewelyn binliner] 10/8/2021 12:57

#The Deacon, the last longwall changeover at Kestrel was Q3-2020, so we are into panel 409 now, how far I can not tell yet, but I believe we will have a full year 2021, and 2022, tapering in 23 and 24, but we still have a royalty footprint on the 500 panel series of around another full years income to come when Adaro get into it, the Kestrel South 400 and 500 panels LOM goes out to 2033..

APF royalty is for 7% of value up to and including A$100 per tonne, 12.5% of the value over A$100 and up to and including A$150; and 15% thereafter..

Our royalty footprint will be mined out in full, current prices are around US$150 / A$200 per tonne, and forecasts out to 2025 of the same prices..

By 2022 we will have VB adding another full Kestrel year 2020 income level (USD18M) on top as Kestrel winds off in 23/24..

Plus there will be new additions, Incoa, BN Piaui, Dugbe, Amapa, could be more by then...

A little disappointing to see the share price down at 130p, but our Q3 update will set our stall out for the next couple of years while the company build the portfolio..

[the deacon] 10/8/2021 12:03

They're actively looking to offload the thermal coal royalties, but agree they'd be foolish to get rid of Kestrel. Its winding down anyway, so won't be an issue very soon..

[cocopah] 10/8/2021 08:48

Johnrxx99 … medium-term I agree, however for now, with the significant rising price of coal and our urgent need to deliver £13m+ this quarter (to service and reduce the debt and keep covering the divi … let alone supporting the s/p) I am very happy to have the Kestrel income.

[johnrxx99] 10/8/2021 08:22

Hope they dump that coal at any price. The politicos will make it valueless soon.

[cocopah] 04/8/2021 21:24

Do we have a Telegram group for APF?

[quepassa] 03/8/2021 12:26

Today's FT page 19

[laurence llewelyn binliner] 03/8/2021 08:36

Hey Cocopops..., we will have to wait and see the impact on Q3 results, but despite Nickel dropping Q2 on Q1, Cobalt production was almost flat which bodes well as the grade must have gone up..

2019 Cobalt 1608 tonnes
2020 Cobalt 1592 tonnes

Q1-2021 VB Nickel 6,100 tonnes | Cobalt 476 tonnes
Q2-2021 VB Nickel 4,500 tonnes | Cobalt 463 tonnes

[cocopah] 02/8/2021 23:37

LLB … thoughts?⬇5039;

[cocopah] 31/7/2021 16:42

LLB - I agree it will be a juggling act. My comments were just a general overview but it’s good to see your detail. Basically it means we probably need income to be another £1m/month to reduce the debt. Q3 could do with being £13m then … 🤔

[masurenguy] 29/7/2021 08:55

Offer now @139p and someone just paid 140p for 4K. 🙂

[laurence llewelyn binliner] 29/7/2021 08:44

#Cocopops, on the debt position, we are net debt GBP78M/USD110M at the end of Q2..

Terms for the VB loan were USD180M to open with, stepping down to 150M after the placing was completed, then stepping down to 125M after 18 months..

Max leverage permitted of 4.5x net debt to EBITDA.
No dividend restrictions when the facility is at US$150M and leverage is below 2.5x
No restrictions on 2020 final dividend in the event leverage exceeds 2.5x
Forecast leverage declining to below 2.5x by the end of Q2-2021..
So the terms are to reduce by -USD25M over 18 months from April..

It will be a juggling act to keep the borrowing in line to enable dividends, but will keep Kevin on his toes as the earnings roll in.. :o)

[johnrxx99] 29/7/2021 08:07

Great posts guys. I don't wish to tempt fate but also good to be troll free.

[cocopah] 28/7/2021 16:43

LLB As you know, I’m definitely here for the income and APF sits nicely in my ISA. As long as it doesn’t become capital erosive I’m not too bothered about the s/p, btw I still think that it could well end up at £1.60 by the year end (and an 8p dividend is 5% yield which is fine by me). The shares in Treasury and cash in hand and LORIC investment more or less cancel out the debt (so I’m not worried on that score either). I would of course like to see ⬆️ dividend in time, which will of course mean hitting c£15m per quarter. 🤞🏻😎👍7995;

[the deacon] 28/7/2021 16:20

Vs royalty peers, APF still stacks up on the cheaper end of the valuation curve. That Noront news really shouldn't be underestimated either. As a royalty holder, having a major develop/operate the project adds significant value.

[laurence llewelyn binliner] 28/7/2021 16:11

#Cocopops, it can be frustrating, but really depends on why we hold the shares, for me it would be nice to look at 175p/200p, but if they were would I sell up..? no I would not, I want the dividend income, and will use that to grow my position or build another one for free..

Do not forget we also had 4,629,703 ordinary shares in treasury shares to sell again if a II wants in, and long term value will shine through as the portfolio grows, I see we have just gone green too briefly, and will probably close near flat.. :o)

H2 income should be around GBP 22/24M, and c40M for the year..
Dividends will be around GBP 19M and leave room to service the debt and chip a little off too..

[cocopah] 28/7/2021 15:05

LLB whilst I agree in the main with your balanced assessment, I do think that the pressure is on for H2. It’s a bit finger in the air, but let’s say we have 2Qs of c£12m (so that’s c£40m for the year). At 45% that will be £18m net (a little less including servicing the debt). Now there are more shares in circulation an 8p annual divi (broker forecasts) equates to £17m. That’s very tight. 🤷‍a94;️

[dogberry202000] 28/7/2021 12:40

Lucky so-in-so.! What's not to like: a great divi, inproved coal, iron ore and cobalt prices in the second quarter, commodity prices at 50+ year lows withn inflation on its way, interesting uranium holdings with great prospects in copper, nickel, vanadium, calcium carbonate, etc.What I like most about this company is that it is boring and that it intends to carry on being boring by holding the right commodities for the 21st century. Once the fairly complex agreements have been made it is just a matter of waiting to let nature take its course and rake in its royalties.As for J. T. he has a great deal of experience in this field and should be left to get on with it. He is entitled to sell a portion of his holding if he wants to. That's his business. He still holds a significant numver of shares,.I should have added this morning.

[masurenguy] 28/7/2021 11:50

Took advantage of the drop earlier this morning and added a few more @132p.

[piedro] 28/7/2021 11:06

LLB, thank you for bringing attention (#10868) to BHP buying Noront.

The prize has always been Eagle's nest, I don't think it will make much difference to our Ring of Fire royalties, (Black Thor, Black Label and Big Daddy chromite), for many years to come.

AIMHO

[laurence llewelyn binliner] 28/7/2021 09:36

I sense a little disappointment here today, and at 1st read through the results do not look great, but bear in mind we are +GBP 1.1M up in July already from VB, and if these deliveries had landed inside Q2 we would be on 10.5M earnings smack in the middle of estimates here..

The LIORC position stands and dividends are rolling in..
Cobalt prices are +12.5% already in Q3 and deliveries are ramping up nicely..
Earnings are expected to be weighted towards H2..
There was a 1 off adjustment charge at Largo impacting earnings..
Coal prices are up from H2..

BHP have bought Noront resources (ring of fire).
Berkeley energia have now submitted a revised application to address any concerns from the recent permitting issues..
Incoa is now operational..
The 3.75p dividend payment is also due in 2 weeks time..

We look forward to updating the market in relation to our investment activity at the half year, and we remain busy advancing our pipeline in order to continue adding royalties and streams to our portfolio.

9 pence per share income is just fine, the share price is to some extent irrelevant if you consider long term, 14 years of dividend income and they have paid for themselves then you will still have the income stream for nothing AND for life.. :o)