Caledonia Mining Share Discussion Threads

[stemis] 19/5/2015 10:58

Encouraging upgrade to resource base

[aim_trader] 18/5/2015 11:18

Mark Learmonth, CFO, will be presenting to investors at the Chesterfield Hotel on Thursday 21st May. To register to attend, click here:

[338] 15/4/2015 15:28

Let's hope the share price will double by Christmas or finally will break through £1

[chipperfrd] 01/4/2015 09:52

The investment plan announced 3/11/14 stated US$50m over 2015-2017 and another US$20m over 2018-2020. So perhaps the Minesite article preferred to just take a view on the inward investment out to 2017.

[chipperfrd] 01/4/2015 09:22

GWR7

Mark Learmonth quoted US$70m in this Minesite presentation last year.



Chip

[gwr7] 01/4/2015 08:34

Analysis: Blanket mine’s $50m expansion
03/03/2015 by Minesite.com
Saw the above article on minesite. Not sure why the cost has increased to $70m from last month.

[chipperfrd] 31/3/2015 10:29

SteMis - agreed!

With such a total disinterest in the shares it is certainly difficult to see any capital gain arising. But, with yields on cash at historic lows, CMCL does provide a very useful return.

No debt and some of the lowest costs in the sector. I make it the 5th lowest out of 55 producers which I track - and one of those is a royalty/streaming outfit, so not an actual miner.

I will continue to park some cash in CMCL for the yield and also for the probability of earnings growth once the gold market makes it's long-overdue return to higher prices.
Chip

[gwr7] 31/3/2015 10:19

Well there is an obvious threat to next year's dividend. I suppose payment of the divi depends on what the gold price does from here.
Also, doubling production is only running to stand still (and they'll be spending $70m to do that) due to indigenisation. Once those folk have paid off their loan they'll be taking 51% of the profit.

[stemis] 31/3/2015 09:38

Now priced at a P/E of 5.7, only 0.7 x ebitda and 0.6 x tNAV, with a yield of 8.0%. 71% of market cap is cash held in UK, Canadian and South African banks.

Current at the start of a 7 year $70m investment programme to double production and reduce costs, with an IRR of 267% (at 8.36% discount rate and gold price of $1,250/oz).

Not sure what is going to trigger a revaluation of this but it's hard to see much downside, surely?

[stemis] 08/12/2014 10:10

I think they are pretty sure they exist

[joan of arc] 05/12/2014 10:15

But the reserves estimates are highly conjectural

[proactivest] 05/12/2014 09:54

Video interview with CFO Mark Learmouth



Mark Learmonth, the chief financial officer of Caledonia Mining Corporation (LON:CMCL, TSE:CAL), tells Proactive Investors about the highlights from the preliminary economic assessment, which reveals an internal rate of return at the Blanket gold mine in Zimbabwe of 267%. ‘Where else are you going to get returns at that level,’ asks Learmonth.

[joan of arc] 25/11/2014 20:21

Should be interesting. I almost certainly can't make it - shame as you can usually 'get up close' to them after the presentation. Anyone going?

[aim_trader] 25/11/2014 10:23

Vice President Mark Learmonth will be speaking at the Proactive investor forum on 4th December. To register click here;

[gwr7] 18/11/2014 08:05

Contrary to what has been said here about the dividend being maintained, the board says it 'envisages' paying the dividend next year and after that it will be reviewed. I see the CEO has paid the price for his complacency.

[joan of arc] 04/11/2014 13:26

Actually having just checked my divi payments I see that AJB have deducted the 25% WT. Does anyone know how to get it back or avoid it in the first place? I filled iin a NR301 form with AJB so if that wasn't to avoid the WT what was the point of it?

[joan of arc] 04/11/2014 13:04

Whoops, thanks. I had a factor in for withholding tax because I was with Barclays and they wouldn't reclaim it. Now with A J Bell so you are right.

[stemis] 04/11/2014 12:53

Dividend is 6c (Canadian) which is 3.3p (at 1.8243 exchange rate) is 7.5%

[joan of arc] 04/11/2014 11:35

Chip, on the bid today I make it 5.8% divi. Don't forget it is Canadian currency.

[proactivest] 03/11/2014 15:35

Another interview with Mark Learmonth:

He didn't want to go into exploration, hence increased investment in Blanket.

[chipperfrd] 03/11/2014 13:24

Hi JoA!

The current dividend comes from Caledonia's cash, and they are confirming that they will continue to maintain it.

It is the dividend from Blanket that is being suspended in order to fund the new CAPEX, so all owners of Blanket will forego their return on earnings (ie the 51% indigenous holders as well!) which is only fair.

Given the current level of CMCL dividend and the present price, the yield is running at c. 8.5% pa. So not too bad at all in my view. With a prospect of longer LoM, increased production, and probably improved earnings and dividend resumption from Blanket 2-3 years out. Then there is the likely level of the gold price going forward and it's impact on margin.

So overall, pretty positive as things stand in my view.
Chip

[joan of arc] 03/11/2014 13:10

Good analysis Chip. So, gold price permitting you buy the story and are confident that they can maintain their divi over the intervening period?

[chipperfrd] 03/11/2014 13:04

At the end of 2010 they had a P&P reserve of 3.84mt containing 467.2koz.

Of that reserve, as of 30th June 2014, they had depleted 1.147mt and recovered 149.5koz.

Balance of P&P reserve remaining is therefore c. 2.692mt containing c. 317.7koz ( of which c. 297koz could be considered likely to be recovered and sold if one ignores mining recovery losses).

This latest report indicates that they expect to mine and process c. 2.08mt of their remaining P&P reserve in order to produce c. 208koz.

So, given average mining recovery % in addition to average milling recovery, this would appear to be a reasonable 7-year forward estimate.

The inferred resources stood at 2.408mt containing c. 408koz gold as of 31 Dec 2010. And their 7-year guidance predicts the mining and processing of 1.95mt of this inferred resource with production of 239koz from that resource.

Overall, this would appear to be a reasonable plan to maintain and grow production over the next 7 years at a CAPEX of $70m split 51:49 between the indignization holders and CMCL holders, ie US$34.3m net CAPEX borne by attributable earnings to CMCL holders.

CAPEX per oz (purely from production from the new inferred resource) would be c. US$292/oz.

Given their current level of operational cash flow generation from Blanket (ie c. $15m pa) this CAPEX would appear to be able to be internally generated over c. 4.5 years at the current gold price irrespective of the production growth implicit in this new mining plan.

Chip

[joan of arc] 03/11/2014 10:45

I suppose the MMs didn't like the rate at which Blanket would run dry without a big investment and since the future depends on inferred resource there is a significant risk that that their projected earnings will not come to fruition let alone surprises and delays getting there.