Goldplat Share Discussion Threads

[lowtrawler] 27/6/2024 11:58

Personally, I have previously held the view that core business operations would be able to maintain attributable profit of around £3.5m on a sustainable basis. I have now started to question whether this will be the case, largely due to the rapid deterioration in SA.

IMV, GDP should trade on a sustainable PER of between 4 and 6 for the core business. If £3.5m were sustainable, that would give a core business valuation of £14m - £21m or c. 8p - 12p. If I reassess the sustainable profit downwards to £2.5m, the share price range would fall to 6p - 9p and we are obviously trading towards the lower end of that range.

As I said earlier this week, a 5 year plan showing higher sustainable profit could help improve the share price It would also allow the TSF to start being included within the share price

[lowtrawler] 27/6/2024 10:48

The price keeps slipping and looks like it is heading back to low 6's.

IMV, the market has assessed GDP will be unable to return cash to shareholders in the near future due to their investment in Ghana, continuing troubles in SA, probable expansion in South America, need to build inventory and costs to process the TSF. The lack of visibility on the TSF means it is still not considered sufficiently certain for inclusion in the share price

[ertugrul] 26/6/2024 09:47

They just released a new interview video

[ertugrul] 25/6/2024 14:44

I believe with generators in place will help to increase productivity

[lowtrawler] 25/6/2024 14:19

Thinking through the use of inventory to maintain activity and some profitability when other contract work is unavailable. It has left me a little perplexed on SA. We may not have several years of stock waiting to be processed but we have enough to keep busy for over a year. With power outages improving, it is difficult to understand why SA is trading in quite such a bad position. Something does not add up. Any ideas?

[ertugrul] 25/6/2024 09:52

It has just shown!

[lowtrawler] 25/6/2024 09:19

I've had delayed reporting with GDP a few times. It will likely appear in the next hour or so.

[ertugrul] 25/6/2024 08:49

I just topped up 114,181 share but not shown... why is that?

[lowtrawler] 24/6/2024 12:40

alm

I selected 5 years because that should cover the period of TSF processing and is fairly normal in the mining sector. It may also help to improve the share price by giving visibility for longer than our PER.

My concern is the Board genuinely cannot predict core trading that far in advance. It would mean they are living hand to mouth and keeping as much spare cash as they can to cushion poor periods of trading. If so, it would make sense of our current PER.

I suppose I'm now starting to understand why kimboy has always been keen on them building up inventory. That way, they can keep busy even when the wider market has gone quiet and gives some certainty on continued profitability. When the market is strong, they can process any deals and re-build inventory. Essentially, it's a more sustainable income stream.

[ih_692232] 24/6/2024 12:14

Low-There are alternatives-
Maybe five years is a long time in this line of business and thus a five year plan is too much to expect ?
But surely the board could produce a 3 year plan -however
Either The board has no idea whatsoever how to write such a plan or they just simply do not have a plan at all ???
Or in the alternative they know the company won’t exist in 3years time -bought out for TSF profits -so there’s no point writing a plan
Which one do you favour??
Alm

[lowtrawler] 24/6/2024 11:03

MF, there have been too many banana skins for any shareholder to be happy. Thankfully, the underlying business has continued to generate good profits.


The main area for concern at the moment is SA trading and the fact it has fallen over a cliff. Little to no indication was provided by GDP to indicate this in advance. The obvious implication is, if it can happen so quickly in SA, why not Ghana. Hence, there will be a nervousness projecting profitability far in advance and we will retain a low PER.


My other concern is the impact of higher interest rates on working capital costs. As we have seen, the interest paid to suppliers on WIP has risen substantially. Again, GDP gave little to no indication of this in advance. We have had some information to indicate how they intend to mitigate these costs but no formal projections.


For the share price to improve, we need progress on the TSF and a full plan with timing, income and costs. I have seen no commitment from GDP to provide this. Frankly, what we need is a 5 year plan to see expected trading in SA / Ghana and the impact of the TSF.

[ertugrul] 24/6/2024 10:46

I know that and nobody is happy with current price, it should never trade under 10p but this only can be an opportunity as this is surely will show the true value at some point... Does anyone have any regular contact with any directors?

[michaelfenton] 24/6/2024 10:23

ertugrul - hope you are right but the share price just drifts lower with no new news. Cannot believe Martin is happy?

[ertugrul] 24/6/2024 10:06

By the way do we have any Telegram group? I am in some other groups for my other holdings that shareholders having!

[ertugrul] 24/6/2024 09:35

Good morning guys, I believe Martin has made safe bet and its much safer then many other AIM companies as GDP makes good profit and will surely return some cash at somepoint to shareholders!

[lowtrawler] 21/6/2024 13:34

To me, Martin remains a mystery. As far as I know, he is a Doctor who manages a small family investment fund and so taking a near 30% stake in a small African based business is not normal behaviour. My best guess is he spotted the value in the TSF and invested for the same reasons as the rest of us. If so, he will be looking for a profitable exit as quickly as possible. I suspect he will want all the TSF profits returned to shareholders but only Martin will be able to answer that with any certainty.

[michaelfenton] 21/6/2024 13:06

Thanks Lowtrawler - all sensible comments. What about Martin Oii who was/is looking after shareholder interests? He owns a large chunk and I cannot believe that he is happy unless TSF is returned to shareholders?

[lowtrawler] 21/6/2024 12:54

MF, I think I'm beginning to understand what GDP have been attempting. I probably have some of this wrong but I believe:

1. GDP identified SA was a declining market and they needed to diversify to survive.
2. That led them to invest in Kili and Ghana.
3. Kili failed because they lacked the skills and expertise. Ghana succeeded because it works to their core strengths.
4. They intend to replicate Ghana in South America.
5. They are still looking for a replacement SA income stream and coal is one possibility they are looking into.
6. Another option to extend life is to buy stock for processing.

The consequence of this approach is they have never been comfortable returning cash to shareholders as they look to move into new markets or to have sufficient cash for stock purchases. They appear to retain the same reluctance now.

In essence, shareholder returns are always at the bottom of their priority list as they seek to secure the ongoing business. Processing of the TSF should throw off huge amounts of cash. There is a danger the business retains much of that cash for reasons previously stated. IMV, that would be a mistake and the windfall should all be returned to shareholders. They have already retained enough earnings.

[michaelfenton] 21/6/2024 12:18

We had plenty of chances with cash available to start a small dividend policy but poor management wasted the opportunities. Now we are drifting waiting for a miracle which may or may not be a pleasant surprise?

[lowtrawler] 21/6/2024 11:53

kimboy, I think we may as well forget any possibility of money from GCAT.

kili should stand as a warning for GDP shareholders. It was a strategic change of direction, paid for from core business profits. The expertise to run a mining operation did not exist in GDP.

There is a danger of using retained profits to diversify into non-core areas where GDP lack the expertise or USP to make it a success. I would prefer them to stick with what they know, improve efficiencies and diversify geographically where it makes sense.

[kimboy2] 21/6/2024 08:05

GDP did well to be divested of GCAT;



I presume that GDP still get their cut if it ever does actually start producing decent amounts.

[lowtrawler] 20/6/2024 16:26

cameron, similar thoughts to myself.

The involvement of Martin is what makes speculation about early monetisation a hot topic. Even though none of us really know what he plans, it seems inconceivable he would want to have capital tied up in GDP for much longer than has already been the case. I'm sure he could hang around while the TSF is processed and paid out as special dividends but that will probably take more than 5 years. Much easier to sell today and move onto his next investment.

It appears to me, DRD will know more about the value and costs of the TSF than even GDP. If our back of envelope calculations are anywhere close to accurate, the TSF alone will be worth more than 10p, probably more than 20p and maybe more than 30p. It provides a lot of scope for DRD to offer a substantial premium to the share price while still leaving a windfall for themselves. If they aren't looking to do a deal like this, they aren't doing their job.

[camerongd53] 20/6/2024 15:24

Lowtawler agree completely with you
I gradually focus my investment on companies that are in a strategically sound spot.I believe GDP is in a sound(ISH) good spot but maybe not as good as last year.
This probably justifies the current price. The excess hope value of a good DRD (whatever the nature) is in the price for free.

[lowtrawler] 19/6/2024 01:07

cameron, most of the discussion around Martin, DRD and the possibility of a bid is just speculation. Of course, there are some highly knowledgeable posters on this board who can join dots together but it doesn't mean there is any substance to the speculation. I have watched obvious bid targets never being subject to a bid and other bids coming out of nowhere. Corporate actions are notoriously difficult to predict and so I always invest assuming none will take place. If they happen, it becomes an early bonus.

[camerongd53] 18/6/2024 20:33

my postof 11197 and recent posts suggest we may be in a poker game with Martin Ooi, DRD and perhaps the directors. Plenty bluff and counter-bluff could be going on.
As a bystander I hope for a good return