Hummingbird Resources Share Discussion Threads

[qs99] 26/8/2020 14:52

interesting posts, thanks all.

Personally I think the LOM is the key thing they need to show movement on now over the next 6-12 months rather than be distracted by other deals.....

still think undervalued, let's see if Mr Market agrees and trends this back towards 40p...DYOR

[dickbush] 26/8/2020 13:45

ohisay, as a riposte to that article, I note that HUM's ASIC was $790 in the 2nd qtr of 2018. I believe that including lease payments in the ASIC only came into the calculation last year. That was $8.2 mil last year i.e. adding about $70/oz. That would suggest a figure of $860/oz for "normal" production-if it were 33,000 oz a qtr. HUM was at $839 in the 4th qtr 2019 when it produced almost 34,000 oz, and at $875 in the current first qtr when it produced just over 32,000. So, pre all the extra costs associated with covid-and lower production- I don't think HUM's performance on this front is open to much criticism except, perhaps, overoptimism re AISC before they actually broke ground. As to the Life of Mine, I'm holding my breath, but you can do a lot more drilling when you're spinning off gobs of cash then when you are up to your neck in debt.

Fingers crossed that covid doesn't get in the way.

[temujiin] 26/8/2020 13:44

Thanks Chip, always good to see your input on any board. Reference to increase in AISC was from previous lows and was mentioned by the BOD. It's certainly come down from the initial mine start up.

[borderterrier1] 26/8/2020 13:40

bubloo Oh look, it's up today!!!! Only another 5 years and this will be 40P!!!

[chipperfrd] 26/8/2020 13:02

Re costs: I forgot to add the following to my previous post.

I calculate All-In-Costs (AIC/sold oz) ie including all investment outgoings rather than just Sustaining Capital.

FY18 was US$1418/oz, FY19 was US$1098/oz and 1H20 was US$980/oz.

Clearly they are generating lots of free cashflow for debt repayment as the interims have shown and 2H20 should continue this trend.
Chip

[chipperfrd] 26/8/2020 12:33

Hi Temujiin,

I took the market reaction to the coup as being an excellent opportunity to add a few more positions although I should state that I work a trading method which aims to reduce holding costs on each and every position and was therefore grateful to be able to replenish on the pullback.

Re AISC: my records indicate an improvement. ie FY18 was US$1087/oz, FY19 was US$986/oz and 1H20 was US$936/oz in spite of guidance that costs might increase by c. US$100/oz - so all good so far re CV19 impact.

Totally agree re Kourousa and Dugbe. Relatively early days for Dugbe but increased PoG will likely make more of the resources meet the cut-off for an eventual reserve statement. In addition, the exploration area has increased markedly with the possession of a licence for the Central block. The number of highly prospective new exploration areas was already large so, on the balance of probability, it is reasonable to assume that the current Indicated and Inferred resource of 4.2Moz is just the beginning in what looks like a potentially huge new gold field in Liberia.

Kouroussa looks tasty!
625Koz Indicated @ 3.35g/t and another 553Koz Inferred @ 2.82g/t make an excellent starting point. The 1.178Moz categorized so far equate to a M&A cost/oz of just US$10.7 !!

Also likely here that the increased PoG will reduce the cut-off and therefore increase the resource even before additional drilling on the road to declaring a Reserve for the eventual DFS report.

The next few years ought to be quite exciting for stake holders if progress can be made on all 3 project areas.
Chip

[temujiin] 26/8/2020 11:54

Don't think many will disagree with your view Chip.

Good solid Interim RNS today as expected and no surprises despite CV19 and a coup. Risk has probably gone up more on perception than actual, as the coup leaders seem to have broad, popular inter-country support, and everything seems calmer now than before the coup!

HUM results look good compared to H1 2019 and are broadly in line with management expectations.
POG obviously having a very beneficial effect on profits.
AISC creeping up as predicted by BOD but tiny compared to rise in POG.

HUM looks undervalued just on Mali operations and upside, but seriously mis-valued when you throw in Kouroussa and eventually Dugbe, even Bunker Hill has value though is a side show.

Some companies have a habit of being under-performers relative to value for years and then can 3 bag in a few months or a year. I've no idea when HUM will properly re-rate, but I'm confident it will.

[dickbush] 26/8/2020 11:49

The scientists will, I believe, come up with a vaccine. So, this, too, will pass. However, HUM's production was affected in its 2nd qtr and it is normal for the market to take nothing on trust. I agree that the statement is one of caution, but it also covers their rear if things go pear-shaped i.e. "Didn't you read the statement?"

Resolute will be issuing its 1st half financial results on Friday. It will be interesting to see what effect covid has had on its operations.

Note that Mali's last reported total infection number was 2,699 and no deaths for a couple of weeks. Credibility?

[bubloo] 26/8/2020 11:26

bt please go to sleep

[chipperfrd] 26/8/2020 11:04

HUM is increasingly undervalued in comparison to its peers.

Based on these interims I calculate the following:

PER ~ 4.1
PBV ~ 0.91
PSR ~ 0.8
Ev/EBITDA ~ 1.73
PCF ~ 2.68

Greenblatt 'Magic' formula ~ 53%
Graham Ratio ~ 0.4
ROE ~ 22%
ROCE ~ 25%

Gross Margin ~ 30.7%
Operating Margin ~ 25.9%
Pre-Tax Margin ~ 25.8%
Net Profit Margin ~ 19.7%

Steady progress being made.
Chip

[drradcliffe] 26/8/2020 09:07

The Bunker Hill investment has done well so far:

The significant share price increase for Bunker Hill to about CAD$1.00 per share at 30 June 2020, has seen the value of the investments increase during the six-month period resulting in the Company carrying a paper profit of approximate $2.8 million as at 30 June 2020. This share price has since dropped from period end and on 10 August 2020 Bunker Hill announced an updated private placement of 58,285,714 units at a price of CAD$0.35 per share equivalent to CAD$20,400,000.

[dickbush] 26/8/2020 08:47

"Whilst the company has a positive outlook for H2 20. there remains some uncertainties into how long this pandemic will last and ultimately this may result in the Company being forced to close its production facilities due to lack of spares and reagents. Therefore, there is a risk that challenges being placed on the business, and the wider economy will further impact the Group's ability to operate, which will ultimately impact its cash flows."

[qs99] 26/8/2020 08:45

LSE board love the RNS as well, odd to see sellers out and red IMO....

Can now see how cash has been spent, include inventory in net debt calculation and it's even lower....if no issues in Mali, IMO this would be pushing over 50p on that RNS....DYOR etc....

So Mali, where to? As long as trading can continue in/out of the country then a risk premium IMO will be added to HUM but less than at the moment DYOR

[charlieeee] 26/8/2020 08:42

A really good RNS and should help to clear out all the traders who saw the recent low as a quick buck opportunity and allow a steadily climb forward.

All very quiet on the Mali front. My expectation is that the next big news will be an offensive against the jihadists in the north. For young men with ambition, hero status is the way to ensure that they remain in power once democratic elections take place.

[qs99] 26/8/2020 08:41

haha post that and it turns red, sorry everyone!

[qs99] 26/8/2020 08:15

hopefully it is an "off we go" moment

[qs99] 26/8/2020 08:01

Well IMO, it is only the "Mali" uncertainty that is holding it back from breaching 50p+.....those results show where an operationally leveraged multi-asset producer can get to in terms of EBITDA....DYOR

[wilco1000] 26/8/2020 08:01

Interesting to see how the market reacts....

[sleveen] 26/8/2020 07:57

Decent set of results as above.

I was sceptical this time last year; but what an improvement YOY.

[qs99] 26/8/2020 07:47

Lovely progress, $39m EBITDA with average GP $1,621, with gold currently $300 above that, happy days.

Soon to be in net cash position and debt fully paid down, multi-asset producer.

Need Mali to "calm down" and not visibly affect operations.........but at this market cap surely the EV/EBITDA ratio is silly? DYOR

[laurence llewelyn binliner] 26/8/2020 07:32

Great progress..., only $12M net debt including cash and gold in hand...

AISC of $938 includes the CV19 impact of Q2

$0.05c EPS, and when it comes to dividends just 0.01 or more is fine by me..

A $6M dent in the trade payables, and we should be net cash positive including cash/gold September/October and with 2000 POG to sell into the Q3 update in 6 weeks will be very interesting indeed .. :o)..

[brasso3] 26/8/2020 07:30

I am sure extra safety measures from Covid 19 are causing all cost to go up with miners.

[bittorrent] 26/8/2020 07:22

RNS - I see AISC is creeping up.