Anglo Pacific Share Discussion Threads

[laurence llewelyn binliner] 28/9/2022 15:16

#GrahamBurn, it is a little unorthodox to report in USD and payout a dividend in an equivalent GBP, shareholders are not directly benefitting no, but indirectly, the cost to the company for the payout is approx 25% less to buy the GBP to payout, increasing retained earnings to smash the debt down..I prefer Dollar dividends and a quoted FX fix for them, but that said some recent dividends received came in at spot and well above the quoted FX fix given for the dividend, gratefully received too, I can only assume the broker elected to receive USD instead and were left to do the conversion at spot on the day.. :o)

[grahamburn] 28/9/2022 14:42

LLB. Your comment about the cost to the company being approx 25% less at the current time and so is a benefit to shareholders is rather obtuse. If there is any benefit to shareholders it is very long term and indeed minimal.

It was impossible not to notice that Marc specifically said though the company were going to pay the dividend in dollars it would still be the equivalent to 7p. That sounded good to a novice investor, but IMO it was a slight of hand. Indeed, it is not in line with the usual procedure for companies which declare their dividends in dollars which are then converted into sterling on a given date. OK, in that scenario shareholders may benefit or suffer depending on the exchange movements between the declaration date and conversion date, but at least the company is paying out a given percentage of its profits to its shareholders.

[laurence llewelyn binliner] 28/9/2022 13:18

#bisiboy, not directly no, but the companies cost will be -25% for the dividend as they payout in GBP not USD so it is to our advantage..

[bisiboy] 28/9/2022 12:57

should we be in for an increase in dividends as a result of sterling weakness?

[the count of monte_cristo] 27/9/2022 14:31

Might be the reverse in the not so distant future when the dollar collapses, but for now it is looking good.

#1knocker, building some positions paying a dividend in USD has proved to be a good move with a +25% gain for free from the FX this year.. :o)

[masurenguy] 27/9/2022 07:28

Yesterday, CEO Mark Bishop Lafleche acquired 40,000 ordinary shares at an average price of 150.16p. His holding has increased by 17% to 274,978 Shares, which represents 0.11% of the issued shares.

[laurence llewelyn binliner] 24/9/2022 10:40

#Cocopops, IIRC the GBP:USD went to around 1.07 in 1985, and although we are getting our 7 pence, the companies income and reporting is in dollars so it is costing them 25% less dollars to buy the pounds to payout (GBP18M) this year from the FX reducing costs and increasing retained profits to hammer the debt down faster.. :o)

Back in 85/86 our rates were 12/13% and reduced to 8% in 88, at the same time US rates were 6% rising to 10% so the dollar strengthened, from 88/89 our rates went 13/14/15% and got ahead of the US, the GBP strengthened and the USD:GBP FX went all the way up to 1.85..

Between 2000/2004 US rates sunk from 5% to 1%, while our rates were 5% in front, the result was the FX went up to over 2.1:1 by 2007..

The BOE need to show some teeth, the MPC had a days start after the FED move by luck this time on account of our weeks delay, they chose not to keep in step with the FED, now -1% behind and as a result our FX got hammered, it could be strategic to throw the GBP under the bus and get behind to boost growth through exports as this is the silver lining and great news for our foreign buyers, but imports are getting very expensive now, holidays in the back yard far more likely than Barbados..!

I am looking forward to the dust settling on Monday after a tumultuous weeks activities, but the fallout could persist as not many are believers in the Truss/Kwarteng strategy just yet..

[cocopah] 24/9/2022 10:25

#LLB I will be surprised if the dollar and pound are not at parity in the foreseeable future. Correct me if I’m wrong but I think £1 to $1.05 is the previous low. I think the Forex market will game it there and let’s be honest there’s not much to stop it happening. Like you I’m glad that a number of my investments are dollar earning and paying … also MBL will be happy that the seven pence dividend will now cost APF less! Definitely sit on hands time now and see what happens … probably some opportunities around spring next year!🤷‍;♂️

[laurence llewelyn binliner] 24/9/2022 07:33

#1knocker, building some positions paying a dividend in USD has proved to be a good move with a +25% gain for free from the FX this year.. :o)

With the next MPC rate review not until November there is room for further GBP weakness, could we see parity with the dollar..? it is getting very close now at 1.085 and not much near term to stop it..?

An ugly day yesterday nearly all round but the dust should settle on Monday and some share price recoveries would be nice to see..

Great news from Oz minerals for us here and West Musgrave now at a bigger scale than expected..

[1knocker] 23/9/2022 22:04

Yes hoard dividends (and plenty of those with Rio, DEC BHP etc) and be ruthless culling the rubbish which tends to build up in any portfolio over time.

[laurence llewelyn binliner] 23/9/2022 17:50

#1Knocker, interesting views, much aligned with my own, a shocking week caused by FED/MPC rate moves, the unthinkable GBP:USD parity comes into view and into the 1.08 zone already..

A defensive PF is/has been pretty insulating so far mopping up dividends, but should a general fire sale occur cash is king of course, exiting positions and moving to cash is a bold move given the dividend sacrifice and in the face of 10% inflation, but if the sale comes it is the seat you want to be sat in for sure..

Alternatively, sit tight, ride it out and hoard dividends to be used in the sales..?

RS companies will see us right over time, interesting times indeed.. :o)

[1knocker] 23/9/2022 17:08

An 'everything' bubble is deflating, with nowhere to hide with interest rates negligible and double digit inflation.

I have had a long standing limit order in to buy more APF at 152, and pulled it this morning. I now think there is a decent chance I shall be able to top up a lot cheaper than that within the next six months.

The $ is rampant, and that is going to kill O&G importing economies. I don't see the FED backing off from interest rate riss, but by the latter part of the northern hemisphere winter something is going to have to give. My guess is that it will be opening the dollar window wide to the 'good boys' who are not side-stepping the sanctions against Russia. That will increase dollar supply, which should depress the value of the dollar a bit (and reduce the effect of the interest rate hikes to depress USA inflation!). The USA is determined to wage proxy war on Russia (oblivious to the fact that the only winner is China, which is a real threat, whereas Russian is not). Russia looks to be setting up for the sort of war it understands, a long fight without regard to casualties or infrastructure destruction. The flood of refugees has hardly begun. The Polish economy is already badly hit, and many other European economies will follow (no need for Russia to bother about the UK though, Truss is doing the job for them. Corbyn style hand outs to fund personal consumption (more than 'Corbyn style' in fact, £150bn makes Corbyn's proposals seem pretty anaemic) combined with more public expenditure on everything from the NHS to the armed forces, together with tax cuts. Its certainly novel; no more tax and spend. Even Labour never tried borrowing to fund both expenditure AND tax cuts.) At the end of it the west will be bust, and all in hoc to the USA, which will also be bust.

I reckon this is the time to build cash despite inflation, so as to have a big wad to take to the 'everything' fire sale but, however low it goes, hang on to your gold. That's insurance rather than an investment, because in a train crash of the magnitude of what may be coming, with huge disruption and unforeseeable govt and central bank 'solutions' no one can be sure of identifying in advance a safe seat in any carriage.

Medium to long term, I see commodities and especially royalty companies as the sectors to be in, but I think there must be a good chance of a general collapse of cnfidence this winter, and the prospect of drops in the market across the board the like of which we have not yet seen. So as the least worst option, I am building cash to take to the fire sale.

[laurence llewelyn binliner] 23/9/2022 14:41

Everything on the FTSE is getting a pasting today, but great news that our recent purchase from S32 is going ahead, and syncs nicely ahead of the Kestrel wind down in 2026 setting us up for our USD100M life after coal income target...

[the deacon] 23/9/2022 14:27

Yes, very good news. As you know my concern was WM gets pushed back. Right now (whilst Oz is the operator) it seems all is on track, with WM front and centre of the Oz plans. Can't be anything other than bullish nickel (esp nickel sulphide) over the medium/long term.

[laurence llewelyn binliner] 23/9/2022 13:39

#The Deacon, some good news on a red wash day..

Oz minerals - 23 September 2022 - Green light for West Musgrave Project
First concentrate targeted for H2 2025, aligned with beginning of forecast nickel market deficit..

Average annual production 35,000 tpa nickel, 41,000 tpa copper in the first five years, average annual production 28,000 tpa nickel and 35,000 tpa copper over a 24-year operating life..

Another big income 2% NSR generator in the pot and cUSD25M a year at todays prices with higher annual tonnages than our initial projections... :o)

[johnrxx99] 21/9/2022 06:31

LLB, in 100 years there will probably only be a few living underground if oil gas and coal is the power source. Mobility won't be an issue, lol.

[valuehurts] 20/9/2022 21:57

But the number of ICE vehicles will also grow over the next few years. Generally higher living standards in India and China will need huge amounts of all the metals we are invested in even if it doesn't mean loads of solar panels and wind turbines. Just a vast amount of people wanting cars, fridges, wifi etc 1/3 of the global population still use solid fuel to cook...

[valuehurts] 20/9/2022 21:41

The company is in a great place and the price of these commodities should ramp especially with the inflationary environment we are in. China is the biggest consumer of EVs and they are building out their nuclear fleet so they can actually power them and look after the population. 19 reactors under construction, 43 awaiting permitting, 166 announced.

[laurence llewelyn binliner] 20/9/2022 19:07

Hydrogen cells are a decade or 2 out and beyond my timeline for sure, if Hydrogen could be produced as a by product and captured for use then all is well and good, but for now it has to be made and uses more energy than it would save, and that is before we get anywhere near the infrastructure to distribute it safely at -252 degrees C..

Oil, gas and coal will energise the planet for the next 100 years, more than long enough for any of us here to be overly concerned, Nuclear will ramp up, but each power station takes a decade to build, and not many governments are carrying a surplus to fund them now, or any time soon..

The ESG green energy race has gotten way ahead of the ability to provide clean alternatives to the same scale or anywhere near it, the results of what happens when gas supply is throttled back is plain to see, the same would apply if producers were to be running out, demand is not going to drop dramatically near term, but it could be reduced over time but maybe at -1% a year..?

As I see it we are very well positioned here to be a part of the drive to battery EV universe, and our commodities can also be used in traditional steel making if not ..

[valuehurts] 20/9/2022 18:28

Aaand... how do they make the hydrogen? It's a method of transporting energy not a source of energy like oil and gas. Only real way is nuclear hydrogen, but that is years off.

[grahamburn] 20/9/2022 14:35

All depends how you read this article:



First 3 paras provides the "feel" for the rest of the article:
The government-backed agency helping to fund the motor industry towards a zero-emission future has warned that with likely shortages of lithium for electric battery production, Britain must lead a transition to hydrogen fuel cell vehicles.

The latest quarterly update from the Advanced Propulsion Centre states that expected shortages of battery-grade lithium in this decade mean domestic manufacturers must prepare to “mitigate” against lacking supplies and to “diversify powertrain choice in the short to medium term”.

It does not expect smaller cars to be switched to hydrogen fuel cells, as battery technology works well in lighter vehicles, but it believes that as many as 75 per cent of the largest and luxury cars on the road — vehicles such as the BMW 7 Series, the Mercedes S Class and the typical output of Rolls-Royce Motor Cars and Bentley Motors — could switch away from electric, with half being moved into running on power from hydrogen fuel cells.

[the deacon] 20/9/2022 09:41

There's been a handful of examples of this recently. APF buying royalties from S32, Sandstorm buying from Glencore, Maverix buying from Barrick, Elemental buying from S32, TRR from Orion and EMX buying from SSR Mining. There's probably more, but I recall these recently off the top of my head.

[cocopah] 20/9/2022 09:23

I wonder if we will take a nibble at the other royalties in the S32 portfolio?

[valuehurts] 17/9/2022 23:50

Future facing commodities but it seems the future is going back to coal and other anti ESG stuff... they could have really made some hay buying a few more coal royalties over the last couple of years... good company but it seems to me that by the time they are fully ESG compliant and expecting all the fund flows everyone will be investing in anti Putin oil gas and coal...