Let's hope CMCL starts to see some benefit of the record gold price in the share price. Might now be time to top up. |
Gold now through $3,000/oz |
CMCL staggeringly indifferent to the surging price of gold |
No Gold miner is suitable for widows and orphans, JP2011, as RSG, AAU, HUM & PUR show, despite CMCL's previous dividend record.
CMCL is operating in Africa and a very unstable part of Africa.
The share price is now below 800p and possibly heading lower.
CMCL is possibly worth a punt at this price, but it's too speculative for me. I only have one share and that's GPM. Back in October I was up 50%, but now I'm not much
above break even though the discount to NAV is almost 25%. |
The dividend record suggests this is for widows & orphans, however given the substantial equity & debt funding for the new project perhaps better to wait &see. |
free stock charts from uk.advfn.com
CMCL 6 month linear chart. Will it go up, or continue on it's downward trajectory? If only I knew! 😁
Probably worth a small punt. Definitely not for widows and orphans! |
free stock charts from uk.advfn.com
6 month CMCL chart. Going sideways hence tightening Bollinger Bands. RSI and MACD look interesting. Worth a punt. |
Article about China's increasing demand for gold at the expense of the US dollar. |
There's certainly funding issues to be finalised, but
Bilboe has an NPV (at 10% discount rate) of ~$310m using gold price of $1880/oz and a payback of just under 2 years. Current gold price is now > $2700/oz
According to Learnmonth "if you were to use spot and actually apply a more realistic discount rate, that NPV quickly goes up towards a £1 billion"
CMCL market cap at 1235p is $308m.
If they can pull this off, it's going to be transformational. |
19k oz. I expect divi will stand as is - they need to accumulate cash for Bilboes |
The company should tell us two things soon:
1. quarterly dividend (last year 2nd Oct: 14 cents)
2. Q3 production (last year 11th Oct: 21,772 ounces, a record) |
Incredible to think that CMCL was double today's price, just over 4 years ago when the gold price was around $2,000/oz. Ok, there's been some dilution (11.5m shares to 19.2m) and some (hopefully, at least in part, temporary) increase in costs of maybe $200-300/oz, but also higher production 55k->75k and ownership of Bilboe. On a comparable basis I'd say the share price should be at least the same level as 4 years ago, not even attributing any value to Bilboe. |
Well, I for one am holding back until I see how Bilboes gets funded.
Otherwise, positive. But I need that question answered before putting any money down. |
I suspect the market is waiting to see how they are going to fund Bilboes... |
The quarterly results look very positive and surprised there hasn't been more of a reaction. |
Shame they don't give indicative ASIC which is probably the biggest driver. |
Good production update let's hope combined with the high gold price this starts to have a positive effect on the share price. |
If they achieve an extra $250 per oz on 75koz is $22.5m straight to the bottom line
They’d probably do better with a main market listing |
Wrt the price, I'd guess the market is uncertain as to how the company is going to fund the Bilboe project. With a peak funding requirement of $309m and a market cap of $184m, it would either require massive gearing or/and a big dilution. The company has said that it's approach would be designed to maximise shareholder value but until they say how, the market is sitting on it's hands... |
Why is this company so illiquid?
And why is the price down 23% year to date? |
 Rich countries plan to buy more gold despite record price
From the above article
“Around 13 per cent of advanced economies plan to increase their gold holdings in the next year, up from around 8 per cent last year and the highest level since the survey began. That follows the lead of emerging market central banks, which have been the main purchasers of gold since the 2008 global financial crisis.
Meanwhile, a rising proportion of advanced economies — 56 per cent, up from 46 per cent last year — also think the dollar’s share of global reserves will fall over the next 5 years. Among emerging market central banks, 64 per cent share this view.”
and
“The consecutive years of record buying, the pace of which has continued into this year, has been a driving factor behind gold’s rally to nearly $2,450 per troy ounce last month. It is up 42 per cent since the Israel-Hamas conflict began in October.
The dollar’s share of global foreign exchange reserves — excluding gold — has plummeted from more than 70 per cent in 2000 to around 55 per cent last year, stripping out the effect of US dollar appreciation, according to research from the IMF this month. Including gold, the dollar’s share has dropped below half, the WGC says.”
This should eventually feed into Caledonia's share price. |
Presentation on Bilboe
The numbers look good at $309m NPV (cp to current market cap of $195m) but it's also worth remembering that we paid $66m for the project in expensive shares. Whether it will all turn out to have been worth it for shareholders will depend on how much of the funding comes from new shares. |
I must admit I have been surprised with the poor share price recently particularly with the price of gold as well as the recent RNS indicating a payback in 1.9 years meaning 8 years of pure profit after payback. |
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