Iofina Share Discussion Threads

[nellyb] 30/10/2013 18:13

100K at £1.83 (late). Someone accumulating.

[superg1] 30/10/2013 16:31

Re valuations

29.1 VALUATIONS TO BE REPORTED ON IF GIVEN IN
CONNECTION WITH AN OFFER

(a) Type of asset
This Rule applies not only to land, buildings, plant and equipment but also
to other assets, eg contracts, stocks, intangible assets and individual parts
of a business. Where such other assets are involved, the Panel should be
consulted in advance.




Staying under the radar has little to do with avoiding suitors, it's more about protecting the iodine resources they are finding. It's more or less unique to Oklahoma, there is no such issue in Texas or California.

[che7win] 30/10/2013 15:57

Johncsimpson,
Yes, I agree with your point.

To answer your question, there is no reason why it has to follow a pattern. If there is phasing, then you are expecting the plants to be bunched up. We do have dedicated teams specifically for the plant rollout, I would hope their workload is evenly spread.

[johncsimpson] 30/10/2013 15:45

Re plant roll out

che7win 30 Oct'13 - 12:30 - 10310 of 10321

Che7 - Is there some reason that next years planned plant roll out has (ignoring your time guesstimates) to follow such a pattern?

If Barratt or Wimpey were developing a new housing complex (I know it's not the same but you'll get the gist) they wouldn't build the first property and then start the second and then the third. There would be phasing; after the drains, services etc. went in that team would move on , then the foundations would then be laid and then that team would follow the service team and then the brickies would start on the first property followed by roofers etc.

At the moment I'm under the impression that IO4, 5 and 6 are in the process of being constructed. For all we know they could be 85 / 90 / 95% complete.

If they started to construct say another 3 plants in the New Year - presumably using different contractors for each new build since it's not like a Barratt build - they could easily all be up and running within 6 months and those same 'construction contractors' could be 2 months into the next three.

jamonit 30 Oct'13 - 13:05 - 10313 of 10322

. . . . Does anyone here really think this is going to happen? One every two weeks?

So yes jamonit, it could happen unless there's some yet to be revealed problem with I03 . . .

Vis a vis next year, what we have to hope for is no great delays with weather, for instance and that any improvements to the core design re actual plant equipment doesn't throw up problems.

[noli] 30/10/2013 15:03

Every day we get closer to the update, so it won't be too long now. aimho. Lots to look forward to, we just have to wait it out.

[che7win] 30/10/2013 14:11

Engelo,
I must admit, I have never got my head around the AIM rules changes regarding contracts mentioned here so often.

To me, a company is only worth what someone is willing to pay for it and an acquirer will pay the minimum necessary for agreement.

If multiple companies are involved in a takeover (as I would expect with IOF, the prize being domination of iodine with a disruptive technology), then the price can go very high.
There must be quite a few in this closed and secretive market eyeing up IOF nervously.
We can see SQM throttling back on production to protect prices, our wee company can keep expanding regardless.

Of course, a friendly approach would have to be willing to pay whatever IOF management deem to be acceptable. If all our contracts make replicating our business hard to do, then these contracts must be valued in a final price.

[bobsworth] 30/10/2013 13:52

Fingers crossed that RNS will confirm some very good Iodine production figures for both IOF#2 & 3.

[scrutable] 30/10/2013 13:36

interesting today - buyers and sellers seem to have exhausted themselves.
Only 46k shares traded by 13.00 hrs. Everyone waiting for that RNS re IO#3 ?

[1madmarky] 30/10/2013 13:33

IO6 maybe physically built but I doubt it will be producing. Just my view.
Edit by the end of this year.

[engelo] 30/10/2013 13:26

chetw7n: while you're in valuation mode SG has made a very good point above about contracts in place. As we all know IOF has 100s of them. On Oct 1st there was an AIM rule change which extends the valuation of contracts to include those cos whose business is predominantly outside the UK. Afaict this is just sheer good luck, could never have been anticipated (white swan?). Has the mkt priced this in? Think not :-)

Another source of value is the Atlantis deep rights 200,000 acres of Bakken, 3 Forks, Nisku etc. Difficult to value but its potentially very big. (My feeling is that you could float a new co with this asset alone.) Said at the presentation that negotiations in progress and if and when a JV is agreed that will tell us.

[bobsworth] 30/10/2013 13:25

Looking very good for Iofina

"In 2012, global crude iodine production was estimated at around 28,700mt and was carried out in only nine countries: Chile, Japan, USA, China, Turkmenistan, Azerbaijan, Indonesia, Russia and Iran".

"During 2012 to 2017, world demand for iodine is forecast to rise by an average of around 3.5% per year and reach 36,300mt".

With Chile now cutting back to offset their high capex and Japan supplies in decline too, plus world demand rising there is plenty of capacity for Iofina to fill.

hxxp://www.roskill.com/reports/industrial-minerals/iodine

[napoleon 14th] 30/10/2013 13:14

sg1 - 10304 useful insight, & a good case for why 1 shouldn't give in to these scammy shorters, like in June with IOF & GBO this week.
The sheep will always get fleeced anyway!

I'm very much looking forward to 2014 & might make some cash & space for these in my ISA as well. Steady progress under continualy more & more favourable circumstances....

How can it possibly miss?

[engelo] 30/10/2013 13:09

Che: yes think there will be more plants in 2014. After all they are putting I03-6 in over 5 months right now (only doubt imo is re tower delays, which won't happen again).

Also agree that from I07-8 onwards some likely to be maxsorbs which could be 80k bpd.

Your 2000 Mt seems to me a good conservative working figure for 2014, which I'll use on the back of my envelope for the rest of the calcs!

[superg1] 30/10/2013 12:57

Engelo
Back to the AIM rules of contracts in place carrying a value so there is great protection.

There was a bit of a grey area re UK residency for the full rules, but in recent announcements it covers just about all AIM participants.

[neddo] 30/10/2013 12:50

what happened to the£5 by xmas? too many mind inventions before they happen ? t/o who mentioned that?

[che7win] 30/10/2013 12:30

Engelo,
Yes I agree.

For 2014, we have to work at a level much higher than just 6 plants commissioned.

Say we have 6 plants established from 2013 running near year end or even early January 2014.

Then 2014 plant rollout scenario (nothing runs like clockwork but let's go by the companies 6 plant build forecast).
BTW, I secretly suspect they think they could beat 6 plants next year, they earlier spoke of 6 plants minimum and 6-8 plants earlier in the year.

So next year:
1 plant built February, commissioned say March, giving 10 months run time.
1 plant commissioned May, 8 months run time,
1 plant c. July, 6 months run time,
1 plant c. September, 4 months run time
1 plant c. November, 2 months run time.

I've deliberately left out 1 plant in my forecast (margin of safety), so only 5 plants built next year. We should also have mini-pods which I'm ignoring and possibly some of these plants might be larger than 30,000bpd.

So in 2014, let's estimate 5 plants built over the year as above. Add total months running above and it's equivalent to 1 plant running 30 months. That's the equivalent of 2.5 normal sized plants running on top of the 6 plants from this year in 2014 financial period.

So forecasts should be for minimum 8.5 plants running full time next year.

2000 MT actual production easily achievable next year, £5 target within 12 months is what I hope we achieve for iodine.

£6 with water in next year, any takeover below this over the next 12 months would be disappointing IMHO.

PS: If the market then looks ahead to 2015 and we get through next year, 14 plants running is the rough calculation :-)

[engelo] 30/10/2013 11:59

che: IOF must be constantly thinking out T/O defence tactics and like the rest of us hope that the 2013 rollout will be completed, and the dreaded water permit granted, while potential predators don't have any decent figures to work on.

Theoretically speaking, any T/O price calculation to-day would be small compared to say, 3 months time with up to I06 producing, water ready to roll (plus more permit applications in), and numerous other developments to be announced in the meantime.

All in all, the mkt will soon have to focus on 2014 rather than the ups and downs of 2013 and adjust to what we think the co is worth. Then on top of that we can add a (speculative) T/O premium :-)).

[che7win] 30/10/2013 11:23

Warmsum,
I happen to agree with you, especially when IOF looks such a good candidate for breaking up by an acquirer.

Water division alone surely worth 80p.

[jonnyno1] 30/10/2013 10:52

thanks for clarifying crosseyed.

j.

[warmsun] 30/10/2013 10:49

For me, it's a further (and sooner) step to us being bought out.
Just my view/opinion!

[johncsimpson] 30/10/2013 10:45

While we're all waiting for this IOF update and there's not too much to talk about on these threads, I spent a lot of time looking at CNEL yesterday – currently very volatile and likely to remain so - been up as much as 600% since Monday's close. I'm not going to pretend I have some magical insight here but there is a very similar general story to IOF though specifically CNEL are an engineering company and not producers of end products; in the case of the 'contacts for 10 plants' which have caused the rise, the end products are biofuels.

My general reading has also led me to two other Chinese companies, Camkids (CAMK) and Naibu Global (NBU) both manufacturers of sportswear.

As always happens when at the start of background reading it's difficult to digest so much new information and it's very easy to get side-tracked as I did on numerous occasions. I mention this as the 'sport thing' led me to the Chinese tennis player Li Na (lost a WTA ranking final to Serena Williams this last weekend and won the French Open back in 2011) - 21 million followers on Twitter nearly $4M of prize money this year and $40m of sponsorship deals in the last 3 years - currently the third highest female sports earner.

All in all impressive stats and China has one hell of an emerging home market albeit it is China. But then I remember how people used to poo-poo Japanese electronics and anything made from plastic.

I see since I started this CNEL are now down 7.5% (they were up +30% earlier) and NBU are up +5%.

Apologies if I've got any errors here - rung one of the ladder so to speak. As always DYO research but three to watch IMO . . .

[phoenixs] 30/10/2013 10:17

$45-$50 for Iodine is great news for IOF. Competition closes mines and they wont reopen in a hurry.When prices recover IOF will be one of the main beneficiaries.

[superg1] 30/10/2013 09:52

SQM closing mines is significant imo. I may have to check but that I think contradicts what they said in recent results.

They clearly had some mines of high opex (dwindling resources) and couldn't cope with the price drop.

They wanted to expand and spend money on the new mining areas but that has been shelved.

This price drop was supposed to hit the smaller miners not SQM. I suspect they will drop production by 3000mt per year as a result.

Sirocco went to 'inventory building' which as we know compared to the reason of why they said that it seems to be BS, as increased production (388mt p.a.) would have fixed their supply lag issue.

With prices in the $45-$50 range even SQM can't handle that with some of their production.

We know Sirocco had opex of $34 to $38 per kg but hadn't solved their 'plant wear' problem which could kill their $60m plant.

Ioditech reported at prices higher than this that some mines were on break even. I suspect SCM bullmine may be on a loss now. I believe they do 600-1000mt. I think they will fold under this price pressure. So with Sirocco that will be 2000mt going out of the market.

I must find those Algorta figures again, but they looked to be on $35 plus opex too.

In discussions way back, it was said that SQM would not want the price to go below $45, well that seems to be spot on, and it now clearly demonstrates, what had been said for months that Chilean miners who cover near 60% of the market had high opex and could not cope with prices around these levels.

It's not a forecast anymore, the price has been hit, and the BS about 'we are going to expand this, and increase production' turned out to be exactly that.

Chile iodine producers are on the ropes, a short jab now should finish some smaller players in Chile.

All of this before some have the Seawater in place. They now can not afford to go that route, and there isn't enough water around.

[crosseyed] 30/10/2013 09:48

This is what the ADVFN Help for the Trades window reports for the C column:

"The 'C' column will contain a 'C' if there are any bargain conditions on the trade. The particular bargain condition for each trade is not reported by the Exchange."

It is not a Contra trade.

c