Goldplat Share Discussion Threads

[sea7] 28/7/2017 12:07

Cutting the nyieme project loose after it sat on the books for years with no work done on it, is a shame, however, it is too early stage for goldplat now. Gerard sees things slightly differently to Demetri in that he is not willing to go for such early stage exploration. He said the licences are due to expire. The costs to get these licences renewed are prohibitive for goldplat and the commitments that will be required are unlikely to be able to be met at this time. It is too small, too early and too expensive to keep. It is the right decision, albeit a loss to the books from the point of view of an asset.

Of course this will be reflected in the publicly quoted headline numbers and we may see the share price drop, due to the reason not being as clearly shown.

No progress on the rand dispute, probably means that it is in the long grass, with lawyers sending the occasional letter to each other and no court date set. Worst case for me is that rand simply dig their heels in and refuse to pay, no matter what.

This would equate to a write off of the debt. We would then see a total of £980k written off for nyieme and about £700k for rand, meaning the loss to the balance sheet would be around £1.7m overall. Obviously it has no direct operational impact, as the nyieme is non cash and the rest is so long overdue that it doesn't affect anything on a day to day basis.

We are down over 20% from the 52 week high, however, so are a significant number of miners.

We have delays in customs for safety equipment/guards in kenya holding up the plant there. The security review in Ghana, is for the fact that an elution plant will be installed soon and the subsequent higher value product on site, unless someones been nicking stuff and it has prompted a review, although I think the former is more likely.

With the company in a growth phase, good cash conversion at the refinery will be key to progress, otherwise it will stall.

The gold sector is in a bear market at this time and whilst goldplat is doing all the right things fundamentally, the share price isn't reflecting it.

They did not anticipate competition when bidding for material in south America, so this has prompted a quick review and a diversification of planned feedstock has taken place, to ensure that they are not having to bid up for stock and crush profit margins.

They are getting there, however, I expect the share price to remain under pressure for a while yet, at least until those accounts show up.

[shareholder7] 28/7/2017 12:06

Kimboy I think you will find that if you have a debt that is more than one year old then UK accounting rules say you have to provide for it.Might be wrong but if they do recover it after a write down, then it would boots 2018 accounts I think you will start to see better accounting principles being applied now with the new FD

[kimboy2] 28/7/2017 12:01

Hi shareholder
I think they hardly tried to bury the £1m write off. It is just confirming what we all knew.

There should be no need to write down the RR bad debt unless RR are bust. It looks as though the wheels of justice will be slow.

As for the balance sheet there is 80kozs that is not on the balance sheet.

As for cash it won't tell the story. They are clearly buying a lot of material in which will cost cash.

The bottom line is that a lot more is going right than is going wrong and this will begin to show through in the figures this year.

[kimboy2] 28/7/2017 11:44

Indeed so. If they were to get to 100kozs, which I think they will at some stage, then at least 50% will be from mining. In that case the profitability will depend upon the terms of the acquisition and the financing arrangements.

Matala, which ALO acquired, cost £1.5m needs about £12m of capex and will earn £43m over 4 years. With some drilling expenditure no doubt the LoM could be extended.

If they could nail something like that then we are well away. I know they are looking.

[shareholder7] 28/7/2017 11:33

I think GDP and their advisors have tried hard to bury the £1m write down of net assets from the balance sheet in this RNS as no issue.This looks to me as the start of the new FD cleaning up the balance sheet.Then the one liner that nothing has changed on the RR front?I think the 2017 accounts will look ugly as they will need to make a provision for the RR debt but will dress it up as one off write downs.Hope that there are no future banana skins as one more, and the share price could be heading back down again.If not then 10p plus could be on the cards again.I think cash is going to be a more important figure than profit when the accounts come out.This will tell you if all is well with the new refinery arrangement and if they are turning stock into cash. We shall see and be interested in Sea's view.

[dangersimpson2] 28/7/2017 09:18

100koz at the margins they currently get on the gold recovery operations would see an annual profit greater than the current market cap.

[kimboy2] 27/7/2017 17:34

...and mostly just speculation at that.

[wigwammer] 27/7/2017 17:15

Sounds like a wall of worry to me. (Built by a poster who has repeatedly called this incorrectly)

[kimboy2] 27/7/2017 15:58

Very good interview with Gerard;



Looking to grow production to 100kozs in the next 2 to 3 years

[russman] 27/7/2017 12:07

Kili - Poor Diesel - what gradesN - 980k w/down should have been done years ago.RR - Bad debt loomingUraguay - who knowsGhana - the locals are helping themselves

[sea7] 27/7/2017 11:15

VSA...

Goldplat (LON:GDP)#
Goldplat (GDP LN) has announced full year production results which demonstrate production increases across the board at GDP's operations; up 14% YoY to 42,857oz overall. Ounces sold or transferred were marginally lower YoY (-1%), which is largely due to a delay in shipping material produced in Ghana. This will now be reflected in Q1 FY 2018.

In South Africa, production of 29,418oz exceeded the strong FY 2016 result and our estimate of 28koz. This was largely due to the successful processing of a major batch of carbon from a new Africa based-client and demonstrates GDP's progress in securing new sources of by-product material. Metallurgical test-work is ongoing for the South African tailings dam and whilst we do not currently include the processing potential in our forecasts we recognise the positive potential. GDP has indicated that approval from the relevant authorities is taking longer than planned, however, in the current climate in South Africa that is to be expected.

FY 2017 gold production at Ghana of 10,031oz was up 46% YoY despite the ongoing depletion of local sources of by-product material, however, was modestly lower than our full year estimate of 11koz. Having altered the plans for installing new elution capacity at the plant, GDP has bought forward its target for adding this new capacity to the end of December 2017. The increase in annual production at Ghana has yet to include the benefits of the South American initiative with the first batches of material due to be processed in Q1 FY 2018 following successful trial processing as well as delivery of material from the first large, long term contract from Uruguay.

We also note that GDP is working with the Ghanaian Government to assess the viability of processing artisanal tailings. This could provide a stable source of material whilst helping the regeneration of former mine sites. Early sampling programmes are now underway and we await the results which could provide significant benefits to GDP and the Government.

At Kilimapesa, although GDP did not hit maximum planned capacity for the Stage 3 ramp up, as initially hoped, the successful completion of Stage 2 has meant that GDP returned to a profitable run-rate in the final two months of FY 2017 whilst production of 3,408oz was up 70% YoY. This is a significant achievement for GDP and we expect the strong positive benefits of this turnaround to be felt in FY 2018.

We had initially expected 4.5koz of production in FY 2017, however, this was not achieved and is key reason for our full year target of 45koz group production not being met. Final commissioning of the crusher section is now expected in Q1 FY 2018 and should enable higher tonnage, grade and recoveries in FY 2018 which will likely have a positive impact on the operation's earnings.

Aside from GDP's key operations, the company's JV partner on the Anumso project in Ghana continued to make positive progress with early stage exploration. Meanwhile at the Nyieme project in Burkina Faso, GDP has decided to allow its rights to the project to expire given the capital required to further develop the project. Consequently, a write down of £980k will impact FY 2017. However, as a one off write down of historic sunk costs this has little bearing on our outlook for GDP.

Overall, despite the modest delay in the ramp up at Kilimapesa the group has performed strongly. Indeed, GDP's main objective for the year was to return Kilimapesa to profitability in which it has succeeded. GDP has demonstrated in FY 2017 its ability to source material from new clients in new regions which underpins our confidence in the company's longer term outlook.
We reiterate our BUY recommendation and 12.2p/sh target price

www.proactiveinvestors.co.uk/columns/vsa-capital-market-movers/28273/vsa-capital-market-movers-goldplat-plc-28273.html

[kimboy2] 27/7/2017 08:25

I notice that they said;
Deliveries of material to GRG from the Company's first large, long-term contract in Uruguay were received during the Quarter with production expected in the new financial year.

The only producing mine in Uruguay appears to be Orosur. The output level at Orosur is 35kozs. The recovery rate is given as 90%.

This doesn't seem a particularly large producer to me. It may be that they have a large stockpile of material or perhaps they can send them sufficient material from current production.

[kimboy2] 27/7/2017 07:52

TU looks good and pretty much as expected.

South Africa had an exceptional quarter with own production of over 10kozs (net of transfers). Profit per oz has been around £180-200/oz at SA.

The key to it all is sourcing and clearly a lot of effort is going into that. The potential Ghana clean up looks very good and I suspect would give a very large supply.

The write off of Manolis' exploration follies is just confirming what we all knew. I have no expectations that Anumso will amount to anything.

I suppose in summary I would say SA and Kili are ahead of expectations an Ghana is behind but improving. With the new elution column and fluidised bed they are clearly expecting improvements.

[sea7] 27/7/2017 07:51

nice ops update, generally good, no banana skins. Good to see a decision finally taken to close off the nyieme project, as it was a non starter. £890k write down.

they are experiencing increased competition for higher grade carbon in south America, which is being mitigated by other feedstock lines.

other negatives are a few delays in kenya and slow progress on the new pit in south Africa.

They state they are focusing on increased security in Ghana. Has someone stolen stuff.

rand dispute dragging on.

[1rodson] 26/7/2017 22:09

No Kimboy its just the share price is talking and Dan is the only one listening. Get real you are stuck in this with a massive losing investment.

[kimboy2] 26/7/2017 19:44

It is a peculiar psychological phenomena where someone has to create a psuedonym to reassure himself by praising his alter ego.

[1rodson] 26/7/2017 18:49

Upside risk poophoo all I see is downside certainty.

No doubt in my mind Dan is the man and always has been where this dead horse is concerned.

[wigwammer] 26/7/2017 17:34

If they make it work, it is an asset. No?If the political risk results in them losing it.. bye bye kili, hello rerating. No?A gamble with nothing but upside risk, it appears.

[russman] 26/7/2017 13:02

The political risk should not be underestimated.Kili is a big gamble.

[kimboy2] 25/7/2017 15:02

Rather than making feeble excuses for a lack of proper research why not try and do a proper analysis of the risks and rewards of this share.

That would be a useful addition to any discussion.

[russman] 25/7/2017 13:11

The risks to the valuation are still current.

[kimboy2] 25/7/2017 10:20

On Kili I have heard it said that the new plant will improve recoverability by allowing more time in the processing. Does anyone know what the actual recovery rate at Kili, or what the rate will be at the new plant?

[sea7] 24/7/2017 16:29

Goldplat historically, has always drifted down between news, as holders get bored and it has never been a traders stock, add in the bearish sentiment in the sector and it bodes for a weak price.

[kimboy2] 24/7/2017 16:18

Its a thin market and tends to go on a random walk between news. IMV it is of course fundamentally undervalued.

We shall see

[sea7] 24/7/2017 16:11

Whilst it is difficult to compare goldplat to other stocks due to its niche status,
we can look at share prices only.

Goldplat down 25% from 12 month high
centamin down 20% from 12 month high
Petropavlovsk down 20% from 12 month high
Sylvania platinum down 30% from 12 month high
Solomon gold down 20% from 12 month high.

So, before the doom and gloom merchants on these boards start claiming that goldplat's stock price decline is the harbinger of doom, they should take into consideration, that across the sector we are seeing declines on gold miners/platinum producers.

Whilst some will no doubt be up for a variety of reasons and some will have fallen further, such as shanta gold, down over 50% from the 12 month high, we can be fairly sure that the drop off in goldplats price is not specific to the company and can be attributed to the weak sentiment in the gold sector.