Iofina Share Discussion Threads

[engelo] 26/8/2013 18:52

Agree bobbys sounds good. The more detail in the interims the better I will like it.

Btw in a recent reply from Sam: 'Gary will be handling IR when he starts with the company in September'. imo Sam has done a sterling joh over a tricky period (Lord knows how many of us email him) but he may be moving off the front line soon.

[bobbyshilling] 26/8/2013 18:14

Thanks Ansana for posting that. Did you get that reply today? (I know that US markets are open today). I like the last two lines - looks like they intend giving some numbers as guidance.

[superg1] 26/8/2013 16:39

An

Much like is being said all over the place.

I've banged on enough about the chem div having it's own production and surplus iodine, CF said it quite clearly, just a month or two back. :-)

[ansana] 26/8/2013 16:20

You can work out the questions I asked....

I apologize for the confusion. Hydrosorb and Hypersorb are one in the same.
> We plan on completing 6 plants next year, and these may include a MaxSorb
> unit (capable of handling larger volumes of water). While each unique design
> is capable of handling different combinations of iodine concentrations and
> volumes, the technology used to extract iodine is based off of Iofina's
> IOSorb technology. Changes to the design are to cater to unique brine
> streams in a way that is most economical.
>
> IO3-IO6 will not have any issues with brine volumes. We have more sampling
> data on these sites than we did with IO2 and we are not worried about any
> issues with receiving the necessary brine to produce.
>
> I believe the market will be pleased with guidance provided in the 2013
> interims in regards to both Iofina Resources and Iofina Chemical

[superg1] 26/8/2013 16:04

Bob

It will always be that way. register 17 extra names if you wish as a non subscriber you can post yourself up 17 times.

Only subscribers can vote down so those 17 can't vote down. The vote system is daft at best, and with the ADVFN system it's totally pointless, not that it wasn't without it.

ADVFN seem to be on a squeeze of idea's to up the subscription rate. Well that's simple, provide a better service, but that is probably stretching the imagination too far.

I believe there is something far better than this option coming onto the market, and far better than that tip site rubbish.

'Keep 'em peeled'

[engelo] 26/8/2013 15:55

Re progress reporting on plants I03-6, I asked Sam the straight question:

q: Is it reasonable to expect that an update will be included in the interim statement when it is issued?

A: Yes. We will include an update just as we have in prior years.

[bobsworth] 26/8/2013 15:52

N3tleyLucas 26 Aug'13 - 14:35 - 7560 of 7563 1 negative 2 positive (Filtered)

Whats the betting those 2 positives for our Filtered Nutty are from his it's own alias.

LOL

[leecoyote] 26/8/2013 15:31

Anybody download this? - bit.ly/1ceKzan

I see IOF is covered and good 'ol Zak seems to be getting the gold stocks right!

[superg1] 26/8/2013 15:10

I haven't mentioned the general bits and pieces going about.

Io plant builds going along nicely with the latter plants for this year already having pads being put in place. A chance of others being started too before the year end.

Chem div done very nicely in H1, and much of the same expected for H2, but that was all mentioned in the H1 presentation anyway, so no surprises there.

So I expect growth for H1 yoy. Interestingly I hear that no trading update is required if a company expects to meet expectations.

I did raise the point that some companies do a trading update as a matter of course, so such news may appear, or we will just have to wait until the interims. We'll see.

Interims last time were mid Sept, so a few weeks to go perhaps.

[superg1] 26/8/2013 14:57

Re the iodine industry.

The only major country involved on large scale iodine production is Chile.

I pick on Sirocco as they very kindly supply all the data.

Sirocco are linked with the highly successful Lundin group, the Lundin group are renowned for success, and this is demonstrated across the various acquisitions and successes, that can be seen throughout there investment history.

I did a little reading. Back in 2011 they looked at the iodine side and thought @hey we can make a good run of that in Chile' Spend $15m and we can get production up to 2000mt and opex of $25 per kg.

Meanwhile a clutch of PI's were looking at Chile and thinking, mmmmmmm it's all going to go wrong there, due to water, power, constant strikes for better pay and so on. The analyst world was pumping the Chile story.

We, on here, were predicting that Chile would get hard, due to water and power issues with rising costs. Now over 1 year on, the Chile news is full of the same points.


So Sirocco were producing around 1200mt when the cunning plan to get to 2000mt by spending $15m was born, and that would mean $25 opex.

Where are they now. 1200mt $34 to $38 opex.

I haven't read what they spent last year, but I know they were going to spend $34m this year and $15m in just Q1 next year. So that is $51m before the 2012 spend.

Now they hope to get to the lower 30's opex.

Then take Algorta. the big plan around the same time to get to 7000mt, then the delays. The multi billion dollar company Toyota Tsusho linked up to gain 25.5% of the company, $73m and then paid out big money for upgrades for a pipeline. Probably spending well over 100m for their 25.5% share.

Last count I heard is that they were around the 2000mt mark with little chance of significant improvement.

In the same timeframe Cosayach the world number 2 went from producing over 6000mt to under 2000mt. They were extracting water illegally and got caught.

SQM, the big guns of the industry have various sectors which have been hit badly, share price in 6 months from $60 to under $26, with iodine now as their most reliable sector.

So the Chile situation for the iodine industry is a story of rocketing opex littered with failures, mainly caused by the rising costs, lack of water, and power. with absolutely no sign of a short term fix and the Chile government predicting it will get worse.

Of course Toyota went there as the saw Chile as the only place left where commercial iodine resources exist. That's what SQM thought and the rest of Chile. That's why Sirocco pooped up and others have tried to expand.

They had no issue, as they all had the same opex and capex problems, and control the iodine market.

There problem will be if someone finds commercial resources elsewhere. If that someone can do it at the same capex and opex it's a concern. If they can do it with a fraction of the capex, that's not pleasant. if they can do it at half the opex, well that is a very serious issue for them too face.

What you have in Chile is a range of producers that have thrown lorry-loads cash at iodine production, not achieved a lot, and have in some cases doubled their opex.

[superg1] 26/8/2013 14:26

Dr

Re

In order to understand something better, it was necessary to use the facts, make assumptions based on facts and best understanding, develop a model of what you wanted to understand, solve the model and publish the results. The resulting paper was reviewed by your peers and feedback might result in correction of errors.


Yes spot on. That's why I like IOF.

I've done 100's of hours research on others AIM shares too, but give up on most within an hour or two.

Why?. well that's because most are simply a great idea, that some way in the future could feature and make some nice returns for someone.

The trouble is it's nigh on impossible to work put what their potential market could be. It's complete guesswork what they may achieve in revenues, with no clue to the value of their product and who would implement or buy it, IF they get it to market.
Some of those shares carry a higher M/C than IOF yet have nothing on the near horizon to give the slightest clue what revenues may flow, some with big debts, little in the way of assets and spewing high amounts of cash, maybe down the drain.

I've been following a few for years, brilliant idea's that should in theory hit the market big time near term.

However on the very same shares, the big time, should have been 5 years back, but if you look back, then the same chat being said 5 years prior to that too.

But then back a total of 11/12 years to see it's highest share price, which back then was 325 times it's current share price.

I think it's a fantastic looking share, with massive potential across many industries, but I'll just sit and watch, if it actually has a plan to deliver or shows sign of delivery, then I'll pay more attention.


IOF is delivering. Share X has been promising to deliver. looks fantastic is 325 times less than it's high and still hasn't got to profit.

That may help some understand why, I don't worry about i04, 5 or any io plant getting a few months behind.

The AIM's have a high number, of high value shares where revenue is not a consideration for many years, IF it ever comes. I would imagine some here have them in their portfolio.

[che7win] 26/8/2013 12:44

Dr,
glad to see some research based on facts, I wish more posted like you.

I have an exit rate slightly lower, but both our sets of figures show the potential and undervaluation.

[freshvoice] 26/8/2013 12:43

Dr A
Please don't entertain the idiot he only thrives on it. He hasn't a real life.
Just an existence on ADV trying to goad people when he's not too stoned to type.
If EVERYONE filtered him he would creep away to his cesspit.

[steveolds] 26/8/2013 12:20

Obviously forgotten your "75p by March" accurate prediction eh Nuts?!! LOL!!

[n3tleylucas] 26/8/2013 12:17

I love this song ... Rewind the Film.

[bobsworth] 26/8/2013 11:58

Dr AndrewD 26 Aug'13 - 10:46 - 7546 of 7551 4 0

Thanks for countering the unsubstantiated drivel from N3tleyLucas 25 Aug'13 - 23:50 - 7543 of 7551 2 0 (Filtered)

As it will not be long now before Iofina will have to open up to the market via their published year end results in Spring 2014 or before, then a PE of 25+ looks a possibility.

On applying a PE of 25+ to the earnings per share, calculated from your margins summary, the share price and subsequent dividends look very exciting indeed.

[rogerbridge] 26/8/2013 11:56

Dr Andrew, Your figures should be achievable for IOF and you put forward a sound piece of research. I dear say that the pods will also make some upside in 2014.

[n3tleylucas] 26/8/2013 11:40

"I see the usual unsubstantiated drivel is being spouted" ... Yes, by you.

"All targets missed is factually incorrect." ... No it isn't, you've missed all roll-out targets, all production targets and will even manage to miss supposedly conservative broker 2013 profit/eps targets. All targets missed doctor, simple enough eh?

"All the actual missed targets relate to" ... That's right, admission is the first step, I'll guide you through the treatment.

"The claim that the company is £80M overvalued is based on nothing of substance whatsoever." ... Wrong again doctor, I've repeatedly forecast profits of £10m 2014 and eps of 8p, and given the poor progress and likely associated future setbacks, I value this on 9 times earnings, so 9 x 8p = 72p, about £100m, so currently £80m overvalued. Got it doc? It's simple to understand mate.

"So on a 2014 PE of just 4, at 37p eps, pretty much covers the present share price." ... Here's where we part doctor, the most ridiculous 2014 eps forecast I've ever seen. It's very funny because it's so so wrong doc.

Anyway that didn't take long, nice chatting doc ... have a great afternoon.

ps ... I'm guessing yer not a real doctor, maybe one of those pretend academic types? Very impressive.

pps ... Oh, and "it was necessary to use the facts, make assumptions based on facts" ... Ah yes, the facts. Be careful which facts you choose though doc, extrapolation is a very dangerous game when it's people's money you maybe influencing. I'm sure your professor mentioned that to you during your support & guidance sessions?

ppps ... Very dangerous poster, assumes a position of intelligence and self-proclaimed 'power', the worst kind of financial adviser. The 'Dr' bit lends supposed credibility ... but I don't buy it, not one bit. Quack!

[worraps] 26/8/2013 11:22

......also, I think your ultra-conservative calculation, of the possibility of only IO5- IO7 in 2014, would be pessimistic, even for a doom-sayer, as if IOF have achieved four plants in 2013, during a learning curve period, then they would certainly be able to achieve more than four plants in the following year, and probably at least six I would have thought. As, the more they build, the experience will speed them up?

[freshvoice] 26/8/2013 11:22

Worraps
Hope you found the link I did.

I am very happy with that one,(of course if I'm correct) DYOR NAI etc

[worraps] 26/8/2013 11:16

Dr AndrewD

You've made that very easy to read and understand, thank you. I like your level headedness, very calming.

[worraps] 26/8/2013 11:11

freshvoice / retiree

Well, that was easy! A few minutes on google, and clicking one or two links, and so much was there, staring me in the face, of particularly US companies, who have resignations of high level company directors, especially in the oil sector. It doesn't take much to whittle them down to the likeliest candidates. Amazing how easy digging can be when putting in the right search request. It's left me feeling very encouraged that we're going to get a very good new CEO, and he will have been worth the wait.

[n3tleylucas] 26/8/2013 11:10

Oh my doctor, that's a whopper! Oh this should be good ... let's make a cup of tea and enjoy it at leisure, not much on telly.

[dr andrewd] 26/8/2013 10:46

I see the usual unsubstantiated drivel is being spouted:
- "all targets missed"
- "it is overvaluing this stock by around 80 million quid"

So I want to say why these comments are complete rubbish.

All targets missed is factually incorrect. All major targets have been achieved or are in progress. What are the major targets /milestones that really make a difference to IOF?
- IO1 designed, plant complete, working at high efficiency, technology proven
- IO2 designed, plant complete, working at high efficiency on a larger scale, plant robust to having a 2000 barrels of oil dumped into it (I find this impressive as no previous tech could cope, just needing a quick reverse flush before starting up again)
- water rights swap achieved
- patent granted (this is a really big one for me)
There are many more, but that is enough to make my point that "all targets missed" is blatantly incorrect and being said to instil fear.

All the actual missed targets relate to minor delays often relating to external factors which in the scheme of things will be inconsequential. It is worth commenting on IO3 which is delayed compared to the original plan, but the plan changed. If this had gone to its original location then perhaps we will have missed out on 50t of iodine ($2M margin) by the time IO3 is commissioned. However, IMO IO3 in its new location is expected to deliver 200-300 t / year more iodine than it would have done. At 250t per year more, that is a margin giving the company an extra $10M/yr more, so putting things into context, the delay will be insignificant in the short term and vastly beneficial in the long term.

The claim that the company is £80M overvalued is based on nothing of substance whatsoever. If you are lucky it might get it backed up by a chart with a line on it but never any facts or explanation.

Some time ago I was an academic. In order to understand something better, it was necessary to use the facts, make assumptions based on facts and best understanding, develop a model of what you wanted to understand, solve the model and publish the results. The resulting paper was reviewed by your peers and feedback might result in correction of errors.

My assumptions, model and results are published in post 7521. Feedback so far suggests that this is in line with other people's thoughts, but I am happy for sensible feedback based on reasonable assumptions to change my mind.

Based on post 7521, in 2014 the margin for iodine is $95M-$140M.

After tax and exchange rate, eps is approx 37p to 55p per share.

So on a 2014 PE of just 4, at 37p eps, pretty much covers the present share price. Remember, this is only for iodine production and ignores everything else. IMO this is a bargain for a growth company.

Whilst I believe that the plant roll out will be achieved as recent RNSs have described and in line with my posted assumptions, I am happy to explore a hypothetical, ultra conservative case. In the last 12 months two plants of new design have been commissioned and 2 more should be commissioned in the next couple of months. So lets consider the outcome if we are up to 4 by the end of this year and add only 3 more (IO5-7) next year. Perhaps this is the doom sayers expectation, but I can only speculate as that information is never provided. So on this conservative basis the result for 2014 would be a margin for iodine of $52.8M-$76.8M giving eps is approx 20p to 30p per share and based on 20p eps, a PE of only 7 is required to justify the current share price. Hence any delays in the roll out even if they were pretty big do not give me any concern whatsoever, and given that we understand that IO8 installation will start this year this hypothetical case seems conservative in the extreme. Furthermore IMO the statement that the company is overpriced is therefore utterly ridiculous.

Finally for clarity, looking at the 2 sets of figures that I believe to be more realistic for 2014 from post 7521, which gives 37p and 55p eps, a very simple analysis gives the following for shareprice based on predicted 2014 eps.
- PE 10 , £3.70 and £5.50
- PE 20, £7.40 and £11.00
- PE 30, £11.10 and £15.50

Therefore, whatever the PE achieved and rate of roll out, I have no fears here and look forward to the future.