Central Asia Metals Share Discussion Threads

[kael] 15/9/2023 12:00

Maintaining the div is great news am also very happy to see they are going for exploration. I thought this may be the case a while back, it makes sense in these markets whilst waiting for distressed companies to filter through. Clearly finding an asset at the right price for caml is difficult, with a very healthy cash pile this is a great move and could well open up a new chapter for CAML and will attact a new breed of investors. Looking forward to the updates on this front.

[bozzy_s] 15/9/2023 10:43

Thanks Zho, worked for me.

Here's a copy / paste. Credit to Alex Hamer on Investors' Chronicle website:

"Central Asia Metals (CAML) is successful in its niche of well-run brownfield operations that were bought at good prices. Management is now adding a new string to its bow: exploration. The company has looked for a third project for years after adding the Sasa mine to its original asset Kounrad in 2017.

It is keen to keep shareholders updated on this process, too, telling them about 22 acquisition options reviewed in the first half and three site visits. Finding a happy price for these assets is the trouble, given the strong outlook for metals like copper boosting prices and current cost of debt making them less affordable.

The exploration effort will be focused on Kazakhstan, where Kounrad is located.

The present operations generated Ebitda of $49mn (£39mn) in the first half, down a third on the first half of 2022. This was largely because of weaker prices but higher labour and power costs also contributed. CAML is also in the midst of a transition underground at the Sasa operation to a new mining method, where tailings are used back in the mine to reinforce workings. This comes after a tailings dam spill at the mine in 2020.

CAML will sling over 80 per cent of its free cash flow to shareholders for the interim payout of 9p a share, double the proportion from last year above its 30-50 per cent payout policy, although the timing of tax payments knocked the free cash figure. The payout is 29 per cent ahead of RBC's forecast.

The company’s yield is way up given its weak share price, which has underperformed its basket of metals (a 21 per cent drop against a 3 per cent drop for the metals). Investors also met the higher interim payout with a shrug. We would add at this price. Buy."

[johnrxx99] 15/9/2023 06:25

zho, doesn't work but no worries. Thanks for the responce nevertheless.

[jimmywilson612] 14/9/2023 10:55

For the Dividend;
In 2022 They spent circa $30M on repayment of debt and $48M out in dividends. Now the company is debt free, they can afford to spend more on the dividend (or limit the reduction of the dividend) as they have $50M as cash on the balance sheet still, or circa 10% of the Market Cap is held as cash.

Whilst the policy states dividend to be kept 30-50% of FCF payout, its not like CAML are taking on debt, or significantly reducing their cash position to pay the dividend.

Clearly they'd like to take on further assets, and it's clear they're in the market to buy. They walked away from deals due to valuation.

Therefore I feel CAML are in a good position - the reducing commodity prices should, in time, relate to more realistic valuations for assets they acquire. In the meantime, if the deal doesn't stack up, then shareholders will hopefully be rewarded with the FCF being paid as a more generous dividend. I'd expect in time, the dividend to only reduce once they've found a target to go after. I don't see the point in reducing the dividend, for the cash only to sit on a balance sheet and not being used effectively.

[pughman] 14/9/2023 09:56

They wasted $5m on the Kounrad solar plant, for a few green brownie points. As a result of the Kazakh uprising in Jan 22 taxes are on the rise, but Kounrad is still a top business. I've always had an issue with SASA, partly in comparison with Kounrad, its returns to date are average. Metal prices historically are good, but costs are really eating into the margin here, pay rises of 15% for each of the last 2 years. What happens if those metal prices fall. Local currencies have been working in CAML's favour also. CAML is a trading stock for me, as you can tell from this, I'm out at the moment.

[bluemango] 14/9/2023 07:32

#5671 "What happens with the final dividend"

They explain that WHT payments will be far lower in H2.

[zho] 14/9/2023 07:17

John,

If you Google on "CAML turns to exploration
Brownfield specialist goes greenfield after years of looking for a new mine to buy" you should be able to access the article.

[johnrxx99] 14/9/2023 07:06

erocnelg - can you please cut and paste as it is subscription only?

[scrwal] 13/9/2023 22:25

The dividend doesn't make sense especially when the company gives details on page 9 of the interims explaining how it is supposed to be calculated but then the board disregard this.
The policy is 30-50% of FCF is returned as dividends yet the interims clearly state the board decided to pay 82% out using the adjusted FCF of $24m so why have they completely ignored their own policy and what happens with the final dividend.

[1knocker] 13/9/2023 09:50

The halving of profits is no surprise. I expected a greater reduction in the dividend. Unless prices firm, Aarebasing of the dividend at a significantly lower level looks to me to be likely, but so far so good. Another 9p out of my purchase price and back in my pocket will be welcome.

[rjmahan] 13/9/2023 08:34

They do not need to make an acquisition - why not just run existing mine well until exhaustion ?

[melody9999] 13/9/2023 07:36

pugh -but I guess they can also see future capex being lower

[pughman] 13/9/2023 07:00

They badly need to make an acquisition. The rise in the cost base is a concern. They have substantially moved the goalposts on the dividend, even allowing for the timing of the withholding tax payments. 82% of FCF against the 30-50% model is a big change.

[gotabsirius] 13/9/2023 06:34

Excellent update. 9p dividend well ahead of my expectations. Conveys confidence in the underlying business and outlook imho

[dunns_river_falls] 13/9/2023 06:26

Conclusion of Solar and paste backfill investment I believe

[andplus] 13/9/2023 06:26

Kounrad in Kazakhstan and the Sasa zinc and lead mine in North Macedonia

[zangdook] 13/9/2023 06:16

What does this mean?"CAML welcomes the material conclusion of its investments at both sites"

[cthompso] 13/9/2023 06:07

Steady as she goes and 9p is better dividend than I was expecting.Looking forward to learning more about on the exploration side too.

[bluemango] 12/9/2023 18:31

No. Tomorrow is declaration day, the ex-div date will come later.

[fionascott1234] 12/9/2023 18:23

Could it be that the MM's got it completely wrong by thinking today was ex dividend and marked us down by the 9.8p and yet finishing level?Marking us down by 9.8 initially tomorrow would confirm it.

[andplus] 12/9/2023 15:37

Good luck to all tomorrow

[1knocker] 12/9/2023 10:48

Pay no attention to outfits like Stocko, or dividend max. They do no stock specific analysis for their dividend forecasts. Compare past forecasts (dividendmax does at least publish these, going back over many years) and compare them with the payments made! The only ones they ever get right are long term static payments.

[bluemango] 12/9/2023 10:01

It's been 20p annually for last two years, so not sure where stocko are getting 24p from.

Would be very happy with maintained two payments of 10p as last year.

[sundance13] 12/9/2023 09:27

Stocko forecasting a drop from 24p in 22 to 20p in 2023 FY