Ferrexpo Share Discussion Threads

[overeager] 28/7/2021 08:24

I'm thinking you may be a little cautious with those numbers. Average CFR 65% Fe iron ore fines price in H1 last year was US$105.6/t and the reported sales were $776m on 6,107kt. I might be wrong, but sales on the H1 production of c5,700kt could be closer to $1.9b with the current higher prices which would end up on a profit after tax of just over $1b. Wouldn't that be nice!

Regardless, I think current concensus analyst estimates are way off the mark.

[zho] 28/7/2021 08:18

bozzy_s,

My rough and ready calcs suggest post-tax profit of $829m, almost exactly the same as your estimate, for eps of 97p at the current exchange rate of 1.39$/£

[denziiil] 28/7/2021 07:50

https://www.riotinto.com/-/media/Content/Documents/Invest/Financial-news-and-performance/Results/RT-Half-year-results-2021.pdf?rev=a9e078b0f42844d78d96b388ea8ac548

[denziiil] 27/7/2021 22:28

$1.5B revenue H1 . Total for 2020 was $1.7B.$900m EBITDA .

[bozzy_s] 27/7/2021 20:51

Denziiil have you had a bash at H1 numbers? Does anyone have analyst forecasts for H1 results?

Here's what I reckon:

Revenue $1,495 m

Cost of production $267 m

Gross profit $1,228 m

Selling & distribution costs / admin costs / other costs $220 m

Profit before tax $1,008 m

Income tax (say 18%, vs 15% in 2020) $181 m

Profit after tax $827 m or £594 m

EPS $1.40 or £1.01


Note - I've given zero credit for concentrate sales or the higher priced 67% pellets. I've used 2019's costs of production ($47.80 per tonne), as 2020 was artificially low due to low fuel prices ($41.50).

If anything I think the above is slightly cautious.

H2 average selling price will be well above H1. And H2 production will be higher. So H2 EPS could be $1.60 - $1.80, for 2021 EPS of $3 - $3.20 (£2.16 - £2.30).

Putting FXPO on a current PE of 2. And a 2022 PE of 1.5 if prices stay stable and production rises slightly as planned.

[denziiil] 27/7/2021 18:47

Nice to see us edging back towards that £5 barrier.

[overeager] 27/7/2021 13:23

I keep having to remind myself that the average CFR 65% Fe iron ore fines price for the last full year was only US$122/t. These interim results are surely going to be spectacular?

[bellbottom] 27/7/2021 12:13

This well worth a read and watching the short four minute video to accompany the document.



Generally agree regards potential invasion and Poltava region far enough away from main hostilities in Donbas region. But we well know that any perceived threats can have a huge impact on the share price I can well remember those days when it got down to 16p when the ex CEO's bank was shut down by the NBU.


Just over a week until the interim results. Exciting times ahead. But when was it not with FXPO?

[bozzy_s] 27/7/2021 11:37

Thanks again BB for your links and efforts. It does look like there's more to the Zelensky v Zhevago affair than we know. I agree with you, if it were a case of coming to an agreement, making some sort of settlement without either party admitting liability, it would've happened by now.

In the long run I'm confident that FXPO is too important to the Ukrainian economy to be messed around with (as Thags commented recently).

For me the biggest long term risk is something neither FXPO nor Zelensky can control - Russia. But I'd say there's less than a 10% chance of Russia invading Ukraine proper. And chances of reaching FXPO's territory - much less than that.

[thags] 26/7/2021 19:56

Thanks BB, I did try having a look but couldn't find anything myself. I like yourself am heavily invested in this and keep track of all the information coming out from the company. I was hoping this Zhevago business would be over by now and I guess we get a bit complacent with the roaring share price. I agree this is a solid company and forward thinking in their approach which is refreshing to see, would like to retire off it if I can and for that we need to get to that 67% 20 MTA target....

[thags] 26/7/2021 18:01

BB with regards to the belanova mine licence being withdrawn from that article you posted. What is the likelihood of the govt stopping fxpo from mining there given the huge economic ramifications, job losses, potential benefit payouts if they have a benefits system like us and the loss of tax revenues etc surely it's just posturing on the part of zelensky?

[bellbottom] 26/7/2021 12:11

The more I read and learn, the more convinced I become of the long term benefits to we as shareholders.

[blueclyde] 26/7/2021 11:13

I expect this to get bid up past the previous highs into what should be a record set of results, huge dividend announcement and possibly a share buy back.

[bellbottom] 26/7/2021 11:08

Can't remember if I posted this up before or not?

[bellbottom] 26/7/2021 11:05

For those of you with seven and a half hours to spare. "The International Forum - Decarbonization of the Steel Industry: Challenge for Ukraine"
Ferrexpo are one of the contributors.
The event took place in Kiev on the 14th July 2021.

[bozzy_s] 25/7/2021 09:41

Thags we'll see £10 and more I'm sure. FXPO is a growing company, with enough reserves to mine into the 2050s and 2060s at least. The market has priced them to disappear in about 3 years time. It's got it wrong. We'll take advantage and be thankful for the opportunity in a few years, getting 60p - 100p a year in dividends whilst we wait.

[thags] 23/7/2021 17:04

bozzy I still think the crunch time is H1 results. If we don't see a good uptick in the share price then I'm not sure whether we will ever reach my £10 target price

[bozzy_s] 23/7/2021 16:37

We can safely say FXPO's share price isn't linked to the iron ore pellet price.

Shares dropped like a stone last Friday / this Monday when the pellet price was unchanged.

Shares up strongly this week, while the pellet price has slumped from $321 to $296.

I'd say a drop to about $150 / tonne is already reflected in the share price. So to stay around $300 should see the shares continue to climb.

[bellbottom] 22/7/2021 09:28

Last years news but gives a good overall picture of the road to Ferrexpo carbon neutrality.




I missed this and not yet clear what impact, if any, it will have on the business. In light of suggestions that the case against Zhevago is entirely political, then this would suggest another example of Zelensky turning the screw on a political rival?



The sanctions noted relate to Belanivskyi, which we would know as The Belanovo Mine, which has a JORC estimate of 1.7 billion tonnes. Feerexpo's mines are Poltava, Yeristovo and Belanovo. How will this impact their plans to reach 20 million tonnes per annum? I admit the whole thing makes me nervous.

Ferrexpo started developing this open pit mine in 2018. What do the sanctions mean for the development of the mine. Here's the original promo video from Ferrexpo.

[igbertsponk] 21/7/2021 14:54

That though arguably is even worse. Fine for a criminal case - you can figure out what will happen. But when politics are involved its much more likely to impact on the company.

[bellbottom] 21/7/2021 14:31

Well, this puts another perspective on the case of Mr. Zhevago. You have to admit that it's a fascinating set of circumstances. Their take on it seems to suggest our ex CEO is an innocent man being persecuted for political reasons. I like to think they are right. Ok, maybe not entirely innocent but worthy of an international warrant?

[nimrod22] 20/7/2021 17:25

A perfect storm brewing......
"Iron ore miners struggle to boost output even as demand soars" article in F....T a few hours ago.
Port Headland to go through 3 months maintenance.
Vale having issues restarting several iron ore projects.
Anglo American are trimming their output expectations due to weather and rail transport issues.
Record Chinese demand at a time when miners are struggling to meet.

[bellbottom] 20/7/2021 14:20

Agree r9505571 - and we mustn't forget the previous order of the energy efficient vertical grinding mills ordered from Metso Outotec.



This is Metso's Vertimill webpage for more details - in a very short time we should really be reaping the benefits of being greener - increased orders and increased profit margins. That should lift the share price and keep dividend payments high.



Like Thags, I am not too bothered about these temporary price movements. Yes there are other issues - Ukraine/Russia and Zhevago, but these have been around now for a long time and the company keeps developing for a better future.
I just wish I had some spare cash to increase my holding but alas I'll have to be satisfied with where I am now.

[r9505571] 20/7/2021 13:38

The planned solar plant will cover 18-70% of Ferrexpo's electricity needs. Good to see the company investing in a greener future.