Goldplat Share Discussion Threads

[kimboy2] 07/2/2024 05:09

The price paid for the SA shares in 2021 was much the same as the 'price' paid in 2016 when the shares were acquired. They valued the SA operation at £20m which, given in 2020 it made a post tax profit of £4.55m, is perhaps not unreasonable.

That is before we take into account the TSF.

In economic terms it is justifiable. The whole thing is of course political, which we are not in a position to judge.

You say that GDP has been generating good amounts of cash for many years. Of course loads got funnelled into Kili. I gave up counting at £10m. It was a failed venture, and I see GCAT aren't doing much better.

If we take the last set of accounts, Kili free, GDP made a post tax profit of £3m. However cash flow was negative £1.2m.

The fact is at the moment there are various drains on cash
1. Build up of working capital, for various reasons.
2. Reduction in profits due to electricity problems
3. Cost of generators to mitigate problem
4. Cost of new dam
5. Loan repayment for buying back BEE shares

Then there is potential capital expenditure for processing the TSF with DRD.

The main frustration has been the continual dalays with the TSF. However I think the fact is that compared to processing it 5 years ago the delay will have worked massively to our advantage with the rand price of gold rising from 18k rand/oz to 38k.

IMV management are doing a decent job, despite the apparent irrationality of the share price

[lowtrawler] 07/2/2024 00:14

kimboy, you mention the SA transaction. The payment made far exceeded the value of the business within the GDP share price. Nobody else would have bought the shares for anything like that value. Why did GDP pay more then the value reflected in their own share price? It wasn't as if the sellers had anywhere else to go. To me, it is another example of management paying lip service to shareholder value.

GDP have been generating a good amount of cash for many years but always found a way to spend the cash rather than rewarding shareholders. The share buybacks were a good start and likely prompted the run to 12p but a policy of returning cash to shareholders needs to be published and a track record of delivering against that policy needs to be formed. New business ventures can be funded from debt and repaid from the returns generated by the new venture. This is a mature business where the majority of cash generated should be getting returned to shareholders.

[kimboy2] 06/2/2024 23:07

In terms of returning cash they did have something like £0.5m of buy backs. Then there was the £4m, IIRC, spent on buying back the share of the SA operation.

This adds up to something like 50% of the present market cap.

The fact that the market is being irrational is not really the management's fault.

The SA shares were bought back using a loan of £3m which I think is up this July. That will free up £1m of cashflow.

Q2/24 update in the next week or so. Hopefully some progress o the TSF.

[ih_692232] 06/2/2024 21:38

Low
Absolutely spot on
The board of directors have in the past 18 months failed shareholders miserably

The TSF is the only hope for shareholder return that lies ahead
Either the company gets bought - only one possible buyer
Or they return dividends from TSF

If neither of these things happen martin will never get his cash out -and we will all be selling shares at 6p or less

They have it all to do

I will be delighted if the company gets bought out -an end to ten years plus tied into what has been a very poor investment
Alm

[lowtrawler] 06/2/2024 01:44

I agree that the current share price is below what the fundamentals would suggest GDP to be worth. However, the cause is clear. At 12p, the market was beginning to believe GDP were serious about returning money to shareholders and was beginning to value GDP as an income stream returned to shareholders.

The annual accounts debacle, unconvincing response to power outages and guidance they were looking to expand into exciting new business areas prior to rewarding shareholders brought an end to our bull run. This was exacerbated by the short term loss of our license in Ghana and tying up significant cash within debtors. Add to this the poor presentations from Werner and a complete lack of ownership for these problems, you have the perfect storm.

Thankfully, the fix is easy. Return the majority of cash generated to shareholders. Have this as a published policy and the price will bounce.

[ertugrul] 05/2/2024 20:25

Exactly Company valuation unrealistic

[dinky00] 05/2/2024 16:56

How the hell have these settled at 6p. They've been this price for 4-5 months. It's absolutely brain-numbing

[ih_692232] 26/1/2024 11:20

Martin will want to sell the company if it can be sold for a good price -is30million possible ? And who will buy ? DRD.. is the only talked of suitor -would they want to buy ??
If no buyer then Martin will want to extract profit from TSF -via dividend
He can’t sell in the open market the share price would tank
So it is likely a sale soon or a longer haul for dividends
Alm

[shareholder7] 26/1/2024 10:27

I am sure he has the same agenda as we all do, and that is to make money. He must be more focused than us. We are lucky to have him.It's simple, we are all here for the TSF and 18 months is a good time scale. if you are not happy with that then sell, love to pick up more shares at 6p

[michaelfenton] 26/1/2024 10:26

Thanks Kimboy for your valuable input.

[kimboy2] 26/1/2024 10:01

He appears invisible because he doesn't make publc pronouncements. However it is clear that what he says goes. That is just the mathematics of the situation and I know he is active.

I think he feels that Gerrard Kemp has brought a sense of direction and a plan to the party. There are a number of opportunities which are being investigated, but they are probably waiting for the TSF monies to be actioned.

There is a thinking on this board that any diversification will end in disaster. Kili certainly did, but Ghana has been a success.

It is a fact that the recovery business will decline in the long term. Grades are getting lower and material more difficult to source. Diversifiction is essental if GDP is going to survive.

Brazil seems to me to be a no brainer. The capital invested is minimal.

I don't know the numbers on the coal thing. It would seem likely to me that the decision has been taken to progress it once funds are available.

GDP is intending to divesify within the theme of recovery operations. I think this argument applies to DRD as well. GDP would be a useful diversification for them, and could probably be completely financed by the TSF.

IMV the only thing preventing a sell out is Martin Ooi. Clearly exiting a 30% holding would be difficult for him if done through the market. A take out is the optimal exit for him.

The question then is price, and when the best possible price can be obtained. The obvious time when the TSF is derisked and before the gold starts going to DRD, which will be some time in the next 18 months.

It is a fact that the value of Martin Ooi's holding has increased recently, though not in terms of the share price When the Jorc was done gold was $1100, it is now $2,000 and the rise is even greater in rand terms.

He has made money sitting on his hands, but I don't think that will continue indefinitely.

[michaelfenton] 26/1/2024 09:05

Since he almost appears invisible I want to know what are his plans for GDP? Only then can we really make a rational decision whether to sell or stay for the trip?

[kimboy2] 25/1/2024 23:33

What would you want to ask Martin Ooi?

[ertugrul] 25/1/2024 16:31

It might be good to have a word from Martin ooi.

By the way Gold is still rising, all looking good but share price!

[dinky00] 25/1/2024 12:45

Do we have any way to contact Martin Ooi directly ?

[swiss paul] 24/1/2024 18:04

yep based on all that information - everyone is piling in - NOT

[sea7] 24/1/2024 17:37

trade types come up as non protected portfolio, single protected transaction

what I have seen on another site, is that the 250k and 350k trades are deleted straight after printing,hence two of each.

the 600k trade, simply says ordinary trade, delayed publication - and still stands, so doesn't seem part of the other lots.

[ertugrul] 24/1/2024 16:51

What are theyI don't think 6.30s are sells

[sea7] 24/1/2024 16:47

some chunky trades today

[kimboy2] 23/1/2024 19:13

Sorry 30 days

[kimboy2] 23/1/2024 18:39

I reckon that the GDP heap is about 3 days supply to Ergo. ISTR that the suggestion was GDP would do about 1-200,000 tpm.

Presumably they are not going to stop the plant to put the GDP stuff through. That means that the JORC is going to be the basis of the contract with DRD.

It would seem sensible to leave it as late as possible to allow as much as possible to be dumped on there.

Presumably DRD have already been doing tests on the material to find out how the GDP TSF fares under their processing. This also will form part of the contract.

Once the button is pushed the only thing that will be unknown for GDP is the price of gold. The tonnage, amount of gold and recoverability will already be in the contract.

It would seem a reasonable assumption that DRD's process is sub-optimal for the GDP heap. That may be why GDP is so cagey about the recovery rate.

The question for the board was whether GDP could have a sufficiently high recovery rate to have compensated for DRD's low processing cost and relatively low capital expenditure.

Plus of course the management time that would have been taken up with it. In addition GDP is getting a load of freed up storage space.

Probably a no brainer but depends on what % of profits DRD want. I presume that this has already been agreed otherwise what basis are they proceeding on.

[shill10] 23/1/2024 14:49

Alm, Werner already said they will do a new JORC- back of the envelope suggests 120-130k oz allowing for some reduction in grade, plus an annual stream of c 6k oz - it is the latter that makes me think DRD might go for a bid, that stream alone is worth the current mkt cap of goldplat, ignoring the TSF and the recovery profits of $3.5mill after tax pa

[ih_692232] 23/1/2024 14:40

And the value of silver recovered?
Why goldplat does not Jorc value tge addtional material deposited is beyond me …they have to have some basis of valuing it with DRG if it is all going to be piped and mixed with other stuff from other TSF -otherwise they give it away
From DRG point of view buying the TSF - not goldplat is their best bet -I assume they don’t want the goldplat business
That would leave Werner and crew in situ but leave a very big lump - heavily discounted though it would be for an outright sale of the TSF
The question then would be what happens to that cash pile
Either from a sale of TSF or several years of working it to nothing via DRG
Various possibilities apply
Alm

[kimboy2] 23/1/2024 13:35

On the rest of the material we don't know the grade, I would presume GDP has got more efficient over the years. Also the fact it is less weathered would, I expect, reduce the reveoverability.

I was really trying to discover a base case. There is lots we don't know but the cost of processing seems pretty firm, given they do the same with all the material,

FWIW I think recovery will be more than 30% and, as you say, there is a lot more material.