Goldplat Share Discussion Threads

[kimboy2] 21/3/2018 15:01

Gerard said the margins were high, so it is presumably pretty cheap.

[russman] 21/3/2018 14:30

What do you think the price of 1t of 300g/t is in South America.Why ship it to ghana.

[kimboy2] 21/3/2018 11:09

Well we know that the 'low grade' material was about 300g/t in the first half. They are predicting they will double production in the second half so I would expect the grade to be somewhere around 600g/t.

[russman] 21/3/2018 09:23

Any idea what average grade this 10k ozs from South America is.

[sea7] 20/3/2018 16:17

good, finally you are not going to make any further comments - goodbye miller, although I am not holding my breath

[sea7] 20/3/2018 14:38

I would be focussing on your so called 11.3m shareholding in lion miller, that you have been buying at over 6p per share. It is still at 2.5p today, with more shares on the market again.

[kimboy2] 20/3/2018 11:51

Sourcing teams have been expanded for all 3 divisions. No idea how much has come from South America but allegedly they are expecting 10kozs pa for Ghana.

[russman] 20/3/2018 11:33

So there is a buying team scouring South America.How many tonnes at what grade has been bought to date.

[kimboy2] 20/3/2018 11:23

Yes they are installing a third on for the low grade stuff, presumably like the stuff they have just processed.

The stockpile is in South Africa and not Ghana and I don't believe it came from South America.

They say it is a year's supply for what is called the underground line. This does IIRC 7kt a month, so they have a stockpile of at least 80kt at Benoni.

[sea7] 20/3/2018 10:31

aren't they installing a third incinerator

[russman] 20/3/2018 09:56

So how many tonnes are in the stockpile awaiting processing.

[kimboy2] 20/3/2018 09:20

Well as I understand it Ghana has two fluidized bed incinerators which will each process 30 tonnes a month. That means in the last 6 months they will have processed 360 tonnes.

Ghana produced 3597ozs in the last reported 6 months. That works out at 309g/t of gold recovered from the raw material. This includes some from the shot blast facility so it will be a bit less.

The company reported that they processed low grade material in the first 6 months and higher grade will be going through next half.

So not 1,000s of tonnes.

[russman] 19/3/2018 12:30

Just go over the South America junk purchase.Coals to Newcastle.What grade is it.Must be shipping 1000's t to Ghana.

[sea7] 19/3/2018 07:50

Yep understand that.

The part about transferring material is one area the anyone glancing over the business won't see immediately. They see the number of ounces produced, see the revenue/cost of sales and simply view it as a relatively high cost operation.

Gerard has tried to address this in the tables provided. Those transferred ounces, simply generate processing fees and charges.

Still, as you say, it is not much of a gamble, apart from overall gold content, based on the samples taken at that buy price.

[kimboy2] 18/3/2018 14:42

The inventory was high because they bought quite a bit of material at the height of the market, and caused subsequent problems later on when they had other problems as well.

The contract issue was a gamble on the gold price in so far as if it was rising they were quids in, an vice versa.

In effect by buying so much material in they are reverting to fixing the price before it is processed, though at a price of £60/oz it doesn't seem much of a gamble to me.

On my numbers for GPL above a profit per oz for 2017 should give an operating profit of about £8m which sadly didn't happen.

This was because they transferred some of the gold to suppliers, which is in effect a cost of material. If we subtract the cost of this from the profit we get an operating profit of about £3.5m.

This compares to £3.3m given in the accounts which I reckon could be accounted for by batch variability, ie the stuff being transferred was not homogenous with the rest.

Anyway if any of that made sense (or was right) my point was that the stock they have apppears very cheap, especially when the gold transferred is taken into account as a cost of material.

[sea7] 18/3/2018 11:19

I think the inventory value in 2011, shows up the flaw in the model, where they were cutting the deal at the prevailing price of gold and not when the material was sold.

This has been corrected and was one of the contributory reasons to the problems they had a few years back.

[kimboy2] 17/3/2018 18:54

During 2011 the average price of gold was $1345 and GBP/$ was 1.59.

The cost per oz, including admin, was £563/oz.

That means an operating profit per oz of £282/oz

The similar cost per oz in GPL in 2017 was £716/oz and the average gold price was £990/oz giving a profit margin of £274/oz.

My original point was that I suspect that they have got a pretty big heap of cheap material. We know that the present inventory cost £60/oz.

I don't know how much the inventory cost per oz in 2011 but note that the inventory was valued at £3.3m, which is 70% higher than 2017, and they probably had less stock.

[sea7] 17/3/2018 18:04

These figures are from eight years ago, however, it is a starting point..

At current prices and average production costs in the region of £330 per oz Au (2009:
£413 per oz Au) at our South African operations and £441 per oz Au (2009: £456 per oz Au) in Ghana, I believe the potential of our operations to generate significant cash flow is evident.

In 2011 - costs per oz in SA show about £530 oz and £588 oz in ghana

they changed segemental analysis after that, however, we see how the costs increase, as gold increased and so, it would not be unreasonable to think of it as an operation that is nearer the £720 oz mark now.

Personally, I think they will make a lot of money on the CIL material and it will be used to offset marginal contracts, where they have bid a bit higher to get the material.

[kimboy2] 17/3/2018 13:47

Talking of CIL material the $80/oz material they have stockpiled in South Africa seemed cheap to me.

Given that GPL make a profit of about $150/oz do we think that their costs are $1koz or is there going to be a bump in profits at some stage, possibly H2/18?

[kimboy2] 17/3/2018 12:21

Presumably this is the sort of background snippet that is in the WHI report which the regulators consider too dangerous for us to read.

The plan is for Ghana to produce 20kozs so it would imply 10kozs from South America.

I would have thought that was easily achieveable, and ISTR they said that they were getting shipments from Peru.

It would not surprise me if some CIL material was going to South Africa, though they seem to be stocked to the gunnels at the moment.

It would be intersting to know who their competitors are in South America who are bidding against them.

[sea7] 16/3/2018 21:34

I do not have access to this site, however, the headline says it all...



Within three years, half of Goldplat's supply for its gold recovery activities in Ghana will come from Latin American countries.