Chaarat Gold Share Discussion Threads

[juju44] 09/4/2020 16:10

Done nothing in 2 years while other goldies have climbed. You didn't get in right Casual . Too bullying and arrogant . Cant hear anyone else. Hope you do better in the future

[oli12] 09/4/2020 16:04

Strange day / time to publish results no? Or is it just me.

[casual47] 09/4/2020 16:02

Copies of the Annual Report and Notice of the Annual General Meeting will be sent to shareholders by 24 April 2020.

[casual47] 09/4/2020 15:58

AGM has been brought forward also:

The Annual General Meeting ("AGM") will be held on Wednesday, 20 May 2020 at 11am at 9-10 Savile Row, London W1S 3PF.

[casual47] 09/4/2020 15:57

Sorry to see you go, Juju. We'll miss you!

[juju44] 09/4/2020 15:54

Depressing stuff . Time to look elsewhere . Most goldies moving up but not here

[oli12] 09/4/2020 15:49

I am out for now.... Better opportunities elsewhere currently - nothing here we did not already know however this lays bare the challenge ahead.

Going concern

As at 30 March 2020 the Group had approximately US$2.2 million of cash and cash equivalents and US$86.8 million of debt (including accrued interest to the date of maturity, the terms of which are disclosed in the notes) comprising the following:

- US$26.4 million Convertible loan note, repayable on 31 October 2021, including accrued interest to 31 October 2021 (Note 18)

- US$19.4 million loan including interest to 31 March 2020 (note 17). On 9 April 2020 the loan terms were amended, and the maturity date was extended to December 31,2020 (Note 33).

- Term loan for US$34.8 million entered into in connection with the acquisition of Kapan in January 2019. The loan is repayable through quarterly instalments over a period of four years, the final payment being January 2023 (Note 23)

- The revolving term loan facility agreement with Labro for a total amount of US$15 million. To date US$8.0 million has been drawn down, US$2.5 million has subsequently been repaid, US$6.1 million is outstanding and a further US$7.0 million remains available to the Group. The facility is due for repayment on 14 July 2020 (Note 19).

The Board has reviewed the Group's cash flow forecast for the period to 31 December 2021. The cash flow forecasts reviewed by the Board exclude cash inflows from funding which is not contractually committed. The forecasts show that the Labro loan will need to be extended or refinanced before 14 July 2020, the $19.4m loan will need to be extended or refinanced by 31 December 2020, and in addition the Group forecasts it will require further funding before Q3 to meet operational commitments and overheads. The forecasts also show that if COVID 19 had an adverse impact on the Kapan mine then a covenant on the Kapan term loan may be breached, and in addition to that the Group would require further funding if the mine was temporarily suspended for more than one month.

[oli12] 09/4/2020 15:32

FY results are out... strange timing unless it allows Mr
A to start buying.

[casual47] 09/4/2020 15:25

Let's say they will refinance Kapan in Q3. By then the Kapan loan principal should have shrunk to e.g. $30m.

If they refinance it with a $50m loan then $30m of that will be used to pay off the existing Kapan loan, $10m to pay down the $19.4m loan and $10m will be available for working capital.

If $5m gets converted from the $19.4m then that leaves only $4.4m which could easily be paid down by end of December assuming e.g. the new Kapan finance is interest only.

[casual47] 09/4/2020 14:58

Good to see the RNS - pretty much as expected. A simple loan extension was my "base case" positive scenario. I suppose they would rather look at refinancing the loan again in e.g. six months time when the Covid issues have abated (hopefully).

From reading the appendix it seems they will sort the loan refinancing and Kapan refinancing at the same time? E.g. refinance Kapan to a new $50m loan, half of the difference ($50m-remaining Kapan principal) going towards downpaying the $19.4m loan.

Interesting to see the clause regarding conversion and specifically the 45 days window and reduction of convertible element from $5m to $2.5m. It would seem to me that BOD might prefer to have as much of this converted as possible but this clause seems to indicate that they rather not dilute this way?

[casual47] 08/4/2020 14:18

Chaarat is a lot more illiquid than most miners.

This is bad - after initial covid panic selling there hasn't been much volume at all, comparatively. So sharp hike down and then barely budged.

This is good - up to 3m shares being bought by one individual should see this rocket (it took less than 3m to see this drop from 38p to 20p and back up to 25p again, and that was a lot of recycled shares).

While some folk took the opportunity to buy in the 20s (including meself) I don't think it was all that much volume-wise so there shouldn't be too much selling into the rise?

[oli12] 08/4/2020 14:12

It would be nice to break the 30p barrier again. Chaarat seems to have missed out on the recent market bounce that has taken place in the last few days. Several miners up 20 - 30 % plus in the last week.

[casual47] 08/4/2020 14:09

Mr. AT seems keen

(though he taketh as well as giveth)

Shouldn't take much for Mr A to drive this back up to 38p.

[casual47] 07/4/2020 11:15

Apart from the $7m or so for the 2019 drilling season I don't think there was that much expenditure for Tulkubash - I am assuming most of the cost would have been borne by Ciftay.

I presume the $7m was paid for by increasing the loan from $10m to $17m.

[casual47] 07/4/2020 11:06

Per the FY production results:

60,252 oz au eq produced
AISC of 1,040 $ / oz au eq
Average gold price realised 1,413 $ / oz au eq

From the presentations:
"AISC/oz produced exclude smelter TC/RC charges and others which add c. USD$ 150/oz"

So total cost will be quite close to 1190$/oz.

This gives me a gross profit figure for the Kapan operation of $13,436,196

During 2019 Kapan repaid $4m on the loan (another $2m was paid during q1 this year). The interest on the Kapan loan is 8% plus 3m libor so will be about $3.5m? The bulk of the taxes will be included in AISC. I don't think they had that much of non-sustaining costs.

We know they had ~$5m cash on hand as of 4th March (that was after they paid down the Kapan loan further to $34m)

[casual47] 07/4/2020 10:33

Not sure why anyone would sell the news at 25p if you know that Mr. A has a waiver buying spree to follow....

[casual47] 07/4/2020 10:24

Of the 8,000 tonnes transported only about 1 tonne of that is gold. However, it is 65% of the total value based on current prices.

[casual47] 07/4/2020 10:22

They sell thousands of tonnes of concentrates of copper and zinc which contain gold. Last year this was in total about 8,000 tonnes worth, most of that zinc concentrate.

Presumably the way they transport this depends a great deal on their trucking operation. They have X trucks which each can contain Y tonnes. No point sending a truck out half empty.

My guess is that this is a fairly continuous process.

[2pablo] 06/4/2020 21:37

I wonder how often we actually sell our gold? An SA outfit I was in sold each week so they were very quick to realise gains from PoG gains - now at about $1660 an oz

Our upcoming results should be very good but if not 'spectacular', results nearly always mean 'sell the news'

[2pablo] 06/4/2020 15:15

I hope Mr A is alright and more specifically his wallet.

[casual47] 06/4/2020 12:46

If this share wasn't so illiquid we could have recovered from the drop by now.

It's pretty clear that the Kapan mine will continue operating.

Even in UK e.g. the building trade is still working.

If punters don't buy then hopefully Mr. A's buying spree of up to 3m shares will see us back in the high 30s (40% increase from where the share price is now...)

[2pablo] 06/4/2020 12:38

Thanks Casual, we should get some decent results probably next week

[casual47] 06/4/2020 12:03

Copper prices this time last year were about a third higher and would have added another $2m in value compared to current prices but gold was worth much less and would have been $11m less in value compared to now.

[casual47] 06/4/2020 11:58

They produced 557,001 oz of silver in 2019. At current prices that's worth about $8m.

They produced 6,476t of zinc in 2019. At current prices that's worth $12m.

So, total value at current prices of 2019 output is $81m.

Gold is 65%
Silver and copper are ~10% each
Zinc is 15%

[casual47] 06/4/2020 11:52

No way near as huge as gold. So "huge" re. copper can be downgraded to "not insignificant".

They produced 1,719 tonnes of copper in 2019. At current prices that's worth about $8m.

They produced 32,791 ounces of gold in 2019. At current prices that's worth about $53m.