Iofina Share Discussion Threads

[che7win] 25/3/2015 11:58

I agree entirely with Crosseyed.There isn't much to post in the IOF front until we hear news, so I welcome the background info about Chile.Japan can't expand via production, but remember that they produce meaningful amounts of iodine from recycling.Chile is the powerhouse for production, I first flagged up about the exchange rate helping their costs, which it has done, but this can't go on forever.As for IOF, I look forward to production figures for this quarter and last years results. Perhaps the market might take IOF as a serious business post publication.The strategy delay is understandable and best outcome for us in long term.

[7cats] 25/3/2015 11:36

Thanks SG1 for all the detailed information on all the Iodine producers in Chile, surely it makes sense to have a good understanding of the current situation of iodine production without this background knowledge how confident would you be investigating in IOF.

As for the strategic review a key part would be the amount of cash available as part of the JV once the permit is approved, we know the review was expected in December but they also expected the water permit to have been resolved by then.
I trust the IOF management know what there doing news will come soon.

SG1 please keep posting you detailed information and those that don't wish to read them use the filter.

[roundup] 25/3/2015 11:36

Rid.. This is what I am referring to:- "have been assured by them that a strategic review has been complicated by the oil price fall and (I presume) the impact that is having on fracking "

[ridicule] 25/3/2015 11:30

roundup They did not tell me what was happening. If any feedback gets the response you have just given there will be no feedback from contacts made by posters who have spoken to the company. I certainly will be very wary of feeding anything back from conversations that were very strictly managed in terms of disclosure by the company when responding to my questions.

[roundup] 25/3/2015 11:25

Adv...that is the type of dribble from management that is bad, bad, bad for the share price. A hint that certain events have overtaken them is not what the market wants to hear. They should either tell us all what is happening or zip up altogether.

[ridicule] 25/3/2015 11:10

I agree with you crosseyed. If there is good news and they HAVE turned the corner, they should not be presiding over a falling share price! For example, they could have issued an RNS explaining why the strategic review has been delayed while at the same time reasurring us that the overall outlook remains positive.

I agreed with the decision to drop monthly production RNS's, but to say nothing while the share price falls when a promised strategic review has been delayed without any reason being notified is not what I expected from the new management.

[odvod] 25/3/2015 11:08

"have been assured by them that a strategic review has been complicated by the oil price fall and (I presume) the impact that is having on fracking "

Well this statement is true and makes me think. What is the need of a specific strategy if the volatility of a certain segment (oil, tax, regulation, water ...) makes it dust in a month or so? We will get a strategy and something changes and here we are again at the beginning strategy being worthless.

Strategy should be done regardless of the unknown and known volatility using games theory (scenarios). One has not have to stick to the plan if there is a structural permanent change. One has to adopt in a clever way.

In the TU I would like to see their way of thinking making actions adopting to the volatility (of the iodine producers, oil price, permitting, new units investments and locations...). Not just raw data facts but also why so. Too much silence in such a noisy environment from IOF atm.
all imho

[crosseyed] 25/3/2015 10:57

Whilst the price of Iodine likely has a marked effect on market sentiment, and therefore the SP, it would seem to have only minimal impact on IOF's profitability. At the moment, most if not all of IOF's Iodine production is then further processed to manufacture derivatives through IOChem. The price of Iodine derivatives would seem to be little affected by the market price of Iodine, as indicated by the production/revenue figures that have been published in the most recent RNS of 31/1/2015 - YoY revenues UP by 35% on IOsorb-produced Iodine UP by 92%. Preliminary calculations suggest that IOsorb produces Iodine at about $27/kg overall but at nowhere near design capacity. We hear of efficiency improvements which should result in production cost closer to $20/kg, reasonably to be expected by year-end 2015.

I would hope that IOF are planning to expand IOChem manufacturing facilities to absorb increasing Iodine production. In the first instance, that could be achieved at little capital cost by introducing a second shift.

Given the market share price action, it would seem that many are not aware of the real economic potential although superg1 posts regularly on the subject. Like many here, I would prefer hard information in more detail from the company, the lack of which has certainly had a negative effect on sentiment regardless of the underlying strong points on which we have factual information. And that is without the water story (though the uncertainty there also undoubtedly contributes to the poor sentiment).

Personally I remain optimistic but of course DYOR.

c

[danwaits] 25/3/2015 10:55

Superg,what happens in Chile and how it reflects on the price of iodine is of little consequence if IOF are not gaining significant traction with regard to production.
My last word on Chile is that you are creating the impression that the current Government's reforms are all going to have a negative impact on the Chilean economy and foreign direct investment. Absolute rubbish! The most important things for any foreign investors to any country are a)Lack of red tape, bribery & corruption, b) Continued government investment in infrastructure, education & health, c) Stable government and industrial relations.
All of the current proposed reforms are going to continue to enhance those conditions. Firms will not have to resort to bribing local officials to get lawful planning and they won't have to worry about being usurped by a competitor gaining advantage through bribery. Taxes will be shared equitably, companies will have access to a highly educated workforce and the Government will have access to funds to improve infrastructure including the security of energy and water supplies. Many firms who benefited hugely during the Pinochet years when corruption, murder, torture and brutality were rife will no doubt be less inclined to invest in Chile from now on, but there are many decent companies throughout the whole world who will.
What effect all of this will have on the costs of energy, water and iodine production is anyone's guess. Right now, I'd rather know how much IOF are currently producing and what their future plans are.

[superg1] 25/3/2015 10:35

Dan

Re

Chile is now coming into it's colder seasons with winter still to arrive and hopefully the drought in the South will be eased. To get an insight into energy and water uses in Chile, posters may wish to google "Diversification of Chilean Energy Matrix: Recent Developments and Challenges by Shahriyar Nasirov and Carlos Silva"

This last year was supposed to be El nino for Chile where something like once in 7 years they get heavy rain. It didn't come and thus it's in a mess re water.

On the prospects of Chile I hope it flies as that will strengthen it's currency. As admitted by SQM much of their costs savings have come from the exchange rate v the dollar. That's why they could take the price so low.

Either way higher costs are coming anyway. So if the drought cripples them that's a plus, if they prosper that's a plus.

Fixed costs over the last few years have seen a 25% drop on exchange rate, as they pay their wages in pesos and sell the iodine by the dollar. The same can be said for Japan re the Yen.

[ridicule] 25/3/2015 10:33

I agree that we need to focus on IOF on this Board. Chile is useful background in terms of global iodine prices but the detail being covered here is blanking out the core issue. When is IOF going to give us a strategy and why have they not done so to date? I have contacted them and have been assured by them that a strategic review has been complicated by the oil price fall and (I presume) the impact that is having on fracking patterns. If this is so, a high priority should have been placed on the promised mobiles. Why have we not heard about them? I have been assured that there will be strategic review announcment but received no defined timescale.

I do not agree that balancing the books at the end of the financial year is the reason the share price is weak. Look at RXP up 30% in the last few weeks and even good old VOG are on the move despite the time of year.

I phoned them up and got an answer machine!! I complained by e-mail that an answer machine is not a professional poc for a number entitled " investor relations". In fairness to them I got a rapid response to my e-mail.

Rather than analysing SQM to (dare I say it) death. Could everyone e-mail and urge the company to pay more attention to managing the share price; a primary responsibility of PLC management if ever there was one!!

[superg1] 25/3/2015 10:26

btw

I still think there is a chance the water news will be known before it's rns news, and officially.

[danwaits] 25/3/2015 09:45

Superg, many thanks for all the incredible amount of research and information you've provided, though I must say that I wholeheartedly agree with roundup's sentiments and those of alphacharlie's post 30877.

What is happening in Chile will have little or no effect on the IOF share price if our production numbers continue to disappoint. 'Fact is, we're in the dark with regard to production volumes and IMHO a small rise in the price of iodine will have little effect on our share price if we haven't managed to improve production.
And this whole saga for the water permit has d-r-a-g-g-e-d on for so long, that I really couldn't give a toss whether we get it or not, although positive news will be very welcome indeed.
Also, as we still haven't got sight of the much promised strategic review, which was originally expected before the end of last year, I guess I'm like most holders on here just keeping my fingers crossed that history is not going to repeat itself and we have indeed turned a corner in terms of production, regardless of the actual price of iodine.

With regard to Chile, some posters on here may have the impression that the country and it's economy are complete basket cases. If that is so, then it could not be further from the truth. The Chilean economy is in rude health. Governance is maturing at a rapid rate from the effects of the years of the military junta and current scandals are merely molehills in comparison to what the country experienced during it's recent history. And I do mean molehills - several recent posts on here have highlighted the false invoices provided by SQM to hide political donations. These amounted to a total of 7.5m Pesos which is roughly $12k or just over £8k. Wow!...

Chile is now coming into it's colder seasons with winter still to arrive and hopefully the drought in the South will be eased. To get an insight into energy and water uses in Chile, posters may wish to google "Diversification of Chilean Energy Matrix: Recent Developments and Challenges by Shahriyar Nasirov and Carlos Silva"

Also page 7 of this recent report presents a favourable outlook for the Chilean economy; hxxp://www.gbm.scotiabank.com/English/bns_econ/latin.pdf

Again, thanks for all of the research and sharing, but I feel that we should be concentrating more on the home front, rather than the macros in Chile.

Dan

[superg1] 25/3/2015 09:44

It happens every March on all shares. Sell for CGT allowance and sell others to offset gains.

It's further complicated by ISA now due to the AIM rule change. Sell for CGT reasons then transfer the max across into isa share accounts post for the next financial year.

At some point in the future (3 to 5 years) then the vast majority of private investors will be free of that issue and it won't been seen so much on the AIM PI wise.

Good timing imo as the earliest I expect IOF to report Q1 production would be the W/C 6th April.

I suspect production will be good due to reduced fracking, and we already know year end revenue is good with those reduced costs to report.

So perhaps like others I'm happy to wait until the end of next week before buying more, unless of course something happens on the water before that time.

Also taking into consideration other factors more immediate like the outcome of the RB bid process.

[roundup] 25/3/2015 09:23

Never mind about Chile or SQM, what about IOF. The price keeps dropping day after day. Even if there was a iodine price hike and some slack in market supply, we are not in any position to fill the market because we are dithering on the way forward. Is it not about time our management got the figure out and made some decisions about out long term future.

[che7win] 25/3/2015 09:17

GATE....worth a short?

[barrywhit] 25/3/2015 07:41

Morning all,

Superg1, I bow to your superior knowledge of the Iodine market and your incredible research, and I hope all your points and forecasts are shown to be correct in the Final Results, as a holder I await them with interest, I am sure the company are doing their upmost to achieve the best results for their shareholders.......regards

[superg1] 24/3/2015 22:38

aha thanks, that explains it.

Nice to see a bit of innovation, spending of cash and making something more difficult to navigate. It was a simple click in the right hand box before.

[naphar] 24/3/2015 21:44

You just beat me to it fresh!

[freshvoicem] 24/3/2015 21:16

Super
You have to search on the numbers only, leaving off the prefix. I got caught by that and became excited only to have expectation dashed

[superg1] 24/3/2015 20:54

Gad

Perhaps both are not prepared to supply it at those low prices. As we know Cosayach are one of the main suppliers to India.

Water Permit

I've had a few messages re the permit now showing as null. That generally means a conclusion has been reached, however all current applications are showing as null, so it's just a case that they haven't added in the data as yet.

EG

Search on this permit which is a fresh application and it shows as null.
40S-30071795