Iofina Share Discussion Threads

[monty panesar] 09/12/2014 01:50

Let's hope Santa turns up on time with the water permit. Good to know it is all trival stuff.

[king_roster_iii] 08/12/2014 22:48

To understand the concept of margins you need to understand the difference between cash and profit. Lets be honest now Netley when you say "margins slashed" you mean you crayoned over the wrong line.

[stanle] 08/12/2014 21:27

Superg - Does Wild Cat Trucking have any connection to Wild Cat Water Solutions? Wild Cat Water Solutions have just applied for a water rights in Roosevelt.

[che7win] 08/12/2014 21:11

ACT, you say
"Exactly, margins slashed, selling more to stand still."

Couldn't be further from the truth, let's look at the facts:

1. First of all, yes, they are selling more (as if that is a bad thing!) - considerably more as the chemical side is up year on year as follows:
"Revenue of $13,020,185 (H1 2013: $11,556,468) during a period of declining iodine prices; "
"Iofina Chemical saw record growth in H1, which is expected to continue for the rest the calendar year; "

That is a considerable achievement and not reflected in the price.

Contrary to what you are saying, margins aren't 'slashed', on the IC side they are 'marginally lower':
"Profit margins for iodine based derivatives were slightly affected adversely by falling global iodine prices"

You of course conveniently miss the point that production of raw iodine was up from 62.5mt to 139.9mt H1 and is further accelerating H2 to an expected full year 325mt+.
Why do I mention that? Well, the significance of the raw iodine ramp up is that it feeds directly into Iofina Chemical which means it will INCREASE margins significantly because Iofina Chemical division was paying much higher prices last year for raw iodine.

The only disappointment is that the increase in margins would have been much, much higher had iodine not fallen so much, but nevertheless, the margins are improving because of our vertical integration.

Regardless of the iodine price, the overall business margins are higher AND I imagine are being maintained when comparing H1 to H2. Thats because H2 we have slashed costs which helps maintain those margins.
The fall in iodine prices have been mitigated to some degree by the fall in our plant costs:

"The Company is focused on the resolution of inconsistent production at the current IOsorb® plants to maximize production, reduce costs and reduce cost/kg of iodine. The Company has also taken steps to materially reduce its administrative costs since May of 2014. Sales through the Group’s halogen speciality company, Iofina Chemical, have seen record revenues for the Period, which is now fully integrated through Company produced iodine."

2. "Positive EBITDA for the Period; "

The first half was full of issues, yet they achieved positive EBITDA, but see below...

3. 'Standing still'
"Cash and short term investment position at 30 June 2014 of $6,270,754 ."

Cash at end of September 30th up to $7,500,000, a significant increase occurred over the summer.

4. What's more, and this is an important point, we were very nearly cash flow positive on operations...despite all the issues and the high overheads in H1.

Cash outflow from operations was a mere "$576,011" or £360,000, that is a figure that impressed me and its not inconceivable that H2 could break into positive cash flow.

5. Now to the mobiles....
"With the design completion of our mobile IOsorb® technology and the successful production of IOprillTM iodine, the Board is excited about Iofina’s future..."

I think few have grasped the importance of the mobiles going forward; I believe there will be a step change with the mobiles which is why the company is excited and why we should be...

Read what the company is saying:
"The addition of mobile units to the Group’s portfolio will allow Iofina to take advantage of many more iodine rich sites in a cost effective manner. It will enable the Company to operate on a temporary basis, such as a pilot project or processing a waste stream associated with a water treatment facility or hyper- iodide rich areas with low volumes of brine. Mobile plants will also allow the Company to scale up and down plants at operators’ facilities as production changes, and can be moved to a new location when needed. All of these benefits will assist Iofina in its continued growth to become the world leader in low cost iodine production within a dynamic industry."

In other words, the key advantage of them is flexibility, it means the ability to move to the most advantageous sites and best brine conditions.
They can always be at the best place and not necessarily at the SWD site in my opinion -they could be at the well head, wherever the best location is and that should excite investors.

That is the key to unlock the global leader pretensions that IOF has....the mobiles IMHO.

6. Don't expect the strategy just to be plant roll out, the chemical side will be part of expansion plans - see the last sentence below, production facilities will grow beyond current facilities:

"The Board believes that, with the completion of IO#6 and the focus of the new management team, the Group is well positioned to increase iodine production, reduce operating costs and continue to progress towards becoming the global leader in iodine and iodine derivatives. With the design completion of the Company’s mobile IOsorb® technology and the successful production of IOprillTM iodine, the Board is excited about the future. The Board looks forward to updating shareholders on the Company’s continued growth, expansion of iodine production facilities and maximising shareholder value.

7. IOF is adopting to the conditions, tweaking existing plants, it WILL keep on growing regardless of iodine prices or oil prices.
I wish shareholders could understand that.

All IMHO.

[superg1] 08/12/2014 20:47

On the selling I'm reliably informed one has been around for about 3 weeks now which very much helps on the weakness, someone has also been picking a few up but is obviously happy to let it drift and get them cheaper.

[superg1] 08/12/2014 20:33

AOTN

What is Iofina chemical, and what is their interest in Iodine?

[engelo] 08/12/2014 19:57

All the other iodine suppliers would give their right arms to be in IOF's position.

While they are scrabbling around with stockpiles and wondering where the next bucket of water is going to come from, and no doubt operating at a thumping loss, IOF have a guaranteed profit stream which can be adjusted to the derivatives demand as required.

[che7win] 08/12/2014 19:35

ACT,
you do talk some tat sometimes, lol, I might have to reply to that....if I can be bothered😉

AOTN, your posts are spot on.

[angel of the north] 08/12/2014 19:05

Thank you for educating me in the little known fact that the narcissist also has to have the last word - no matter how nonsensical. I'm off back to bed - you're just plain boring.

[arlington chetwynd talbot] 08/12/2014 18:40

Exactly, margins slashed, selling more to stand still.

[angel of the north] 08/12/2014 18:31

Iofina Chemical continues to perform well utilizing Iofina produced iodine. Year-to-date (YTD) through October, Iofina Chemical derivative sales are up over 25%, even with downward pressure on iodine prices throughout 2014. - update November 2014.
Keep up boy!

[arlington chetwynd talbot] 08/12/2014 18:28

"We know the chemical side is doing remarkably well"

No we don't.

[angel of the north] 08/12/2014 18:24

If I were a new investor landing on this thread before deciding.....I think I would be affected very adversely and run a mile. This water application must, in the eyes of a newcomer be crucial to the company's survival and the fact there seems to be an objection which is threatening its very life doesn't read well.
As long term holders here know, the water side isn't a core business - but the real business is somewhat neglected here at present. We know the chemical side is doing remarkably well and we are somewhat in the dark regarding Iodine production although the intimations are very good.
Getting back to the water......I'm so far beneath the waves that Jules Verne would struggle to find me!

[awolagain] 08/12/2014 16:15

lol! brilliant...it really is.

[festario] 08/12/2014 15:23

MM3, thats the funniest post I have read on ADVFN in the last 5 years. Made funnier by the fact that most won't get it.For the paranoid looking in, your investment does not rest on whether you get it or not.... seriously.

[monkeymagic3] 08/12/2014 15:18

Zendo - The name of the examiner at the DNRC is Mrs Toaster

[zendo102] 08/12/2014 14:53

Can someone explain the toaster references, please? TAI

[monkeymagic3] 08/12/2014 14:40

I dont get marmite.

If I wanted a brown, yeast based spread on my bread I would just throw a slice of toast into my laundry basket.

[woolybanana] 08/12/2014 14:23

Just a slice of toast would be nice, with Mr Hollande taking away in taxes the very marmite spread I used to be able to afford.

[festario] 08/12/2014 13:13

Funny MM3, I like it.Joe Stalin... 'Fortunate' am I ?I actually need a 200% rise to reach break even, despite determined averaging down!MM3, I have been looking longingly at the toasters in Tesco bargain range only today..... truly a bargain at £12.99!

[arlington chetwynd talbot] 08/12/2014 13:13

If we all refuse to buy, then this will hit 25 in no time at all.

[monkeymagic3] 08/12/2014 13:01

"Good morning,

Please disregard my previous enquiry regarding the Dualit 4 slice 24 carat gold toaster.

The recent performance of a particular share means I can no longer afford to purchase the item.

Thank you and Merry Christmas"