Iofina Share Discussion Threads

[phoenixs] 07/11/2013 18:58

superg1, corrosion? seawater?

[superg1] 07/11/2013 18:31

Good summing up of why I'm invested long term.

Crosseyed

While we are on the subject of opex.

For Q3 2013 Sirocco's opex was $41 per kg. Their highest cost so far this year.

I thought their Q2 had a smell of BS about it. The point being they intended to in crease production by 388mt, but went to inventory building to close a 12-14 supply lag time to 2 weeks.

To close that gap they stated they would go offline for supply for 6 months. They would have soon closed the gap on supply times with increased production. It turns out production went down.

Anyway the key point is opex, it has jumped around a bit this year, 38, 34 and now 41.

No mention of the plant wear, but still the capex and installation of equipment in an attempt to halt that in Q1 2014.

My bet is still corrosion, not wear.

[naphar] 07/11/2013 18:26

Meadow, where? Might have missed that! Tia

[meadow2] 07/11/2013 18:25

naphar - IOF have already stated that they've entered arrangements to supply at least one customer. I wonder if they will show any sales income separately or subsume any sales into other figures?

[festario] 07/11/2013 18:15

Meadow2, Agreed... in fact I will personally commission a 50ft high statue of SuperG to be sculpted, in the event that IOF makes me a rich man.

EWCT, seeing as you ask, I will stick my neck out and say that today was the low point for the share price If it does dip back into the 150's, I will immediately buy back the 15,000 I sold at 168 yesterday.
The rest of my holding is intact.

[naphar] 07/11/2013 18:13

I could of course be totally wrong, but I think the best hope to get that meadow will be if we sell some mud/came in 2013 and they shown the accounting split of that

[meadow2] 07/11/2013 18:07

Festario - I stand by what I said. If IOF performs as is possible, then superg1 will, indeed, be "worthy of great respect".

Naphar - I appreciate your caution, but I'm banking on year-end 2013 figures and an indication in the report of the early 2014 production and further prospects to give a predictive guide to a full year's possibilities.

[everybodywangchungtonight] 07/11/2013 18:02

Out of interest fest, as 170 didn't hold, where is your next predicted support line?

Do you see the gap 149-154 being filled?

EWCT

[noli] 07/11/2013 17:54

Meadow, 800mt is the max ioc could use without expanding, iof purchased a site for the expansion of ioc. IOF also have a facility in Montana as back up, this could soon be turned into a facility to expand should the need arise in fast order.

[festario] 07/11/2013 17:52

Ha Ha Meadow2, should that not read 'the UN-estimable' SuperG?? That would be the correct compliment. Trust me, Google it if you don't believe me.

Your phrase is tantamount to saying, 'with all due disrespect'.

It made me laugh though, unlike me share portfolio performance today.

[naphar] 07/11/2013 17:50

Meadow, I would not expect too much from FY numbers. We should see an improvement but it depends on how much of the purchased iodine has been used,ie are we producing derivatives with internal iodine yet, as well as whether we sell any mud/cake. If the answer to both is yes, I expect to see a good improvement. If only the first is true, we will see some margin improvement, and if neither is true, improvement could be negligible IMO.
I am not convinced we will see enough to prove or disprove our hopes and aspirations until we get H1 2014 numbers at the earliest. I will be very happy if I am proven wrong!

[meadow2] 07/11/2013 17:38

crosseyed - You will now understand why I, like many others introduced to IOF by the estimable superg1, believe that 2014 should (there is never certainty in investing) be quite a year. End year 2013 results, due about April, 2014, will prove or disprove our hopes and aspirations.

[crosseyed] 07/11/2013 17:21

So as it stands, the cost of raw materials should be reduced by about 70% (assuming around $15/kg for internally extracted iodine by IOF) which goes straight to the bottom line as additional profit cf 2012. Not to mention the increased production volumes and other cash-generating assets.

Now I'm beginning to understand the outstanding economics of IOF.
Thanks for the explanations,

c

[meadow2] 07/11/2013 16:52

noli - If IOC are using 800mt per year ie 67mt per month on average, then I understand why IOF could well be selling monthly surplus iodine into the market. Next published results should be quite interesting.

[naphar] 07/11/2013 16:51

IOF iodine production should reach a stage where they start selling "mud/cake/crystalised" iodine to 3rd parties, as they will not have the throughput in Iofina Chemical to use it all. At some stage, we might install a prilling machine, and then start selling prilled iodine into the market. Prilled is much purer than mud/cake, just because it contains less water, but the quality of the iodine is the same, and much better than some on the market.

Personally I believe we should already start selling some mud/cake in 2013 to bring in revenues, it has been stated we are producing more than Iofina Chemical can use currently. Selling some this year (assuming we are producing enough for it not to be a concern) would be great for both the P&L and balance sheet this year.

[noli] 07/11/2013 16:39

All purchased and iof produced goes to ioc, ioc then make the derivatives and sell at a higher price. As iof stopped buying iodine in and are now a producer of the product all magins will increase, the raw iodine produced by iof will go to ioc, i believe 800mt is what ioc can convert into derivative. However iof make some derivatives in the field at IO#2.

[crosseyed] 07/11/2013 16:34

meadow2/noli/naphar,

Thanks for your responses. All part of the learning process. I see that there were inventories at 31 Dec 2012 amounting to$4.056 million of which $1.761 million was accouted for by Raw Materials, presumably at historic cost.

Do IOF sell the raw stuff directly, or is iodine from the extraction facilities passed on to the Chemicals division for processing of derivatives ?

c

[noli] 07/11/2013 16:33

I believe it was the end of jan 2013 iof purchased the last iodine shipment, the inventory was high due to a decent size order that was pending which i believe was filled by iof.

[larboulois] 07/11/2013 16:30

noli and naphar

Thank you for the explanations re opex. I need to pay more attention

[superg1] 07/11/2013 16:20

RV

Clearly some read that in the wrong way.

I'm purely going on experience on various shares over the last 4 years, mainly in relation to what I've picked up on BB's. If I look at share I tend to read the many 100's of posts, sometimes 1000's to see what decent info I can eek out from that.

I talking more about herd investors. Then those that panic or overreact.

Some simply react because they think others will, which often starts a spike up or down.

I watched 100 mill shares bought on a share that little volume in the weeks prior. On what was decent news very little action went on, on the next rns, the way it was worded caused a herd stampede and big rises. There was little thought put into whether was said meant and whether it was viable or not.

That is one of dozens of shares I have seen it on, so yes I worry more about investor reactions than an actual business and it's plans.

When I say investors, that isn't just PIs but city folk and even funds too, as at the end of the day, a fund manager makes a call.


Be greedy when others are fearful, and fearful when others are greedy.

There are numerous quotes that cover all the behaviours. No matter how many the famous successful guys tell us their secrets, the reaction and behaviour of investors will be the same, contrary to what they say, for as long as investing exists.

One line in an rns more or less caused chaos, an H and S sign off. E.G. Any spills from your plant and it's your problem and liability not ours. I don't think anyone would consider it to be any other way. Those events happen on any handover, I did it daily for years, and so do millions of others.

[phoenixs] 07/11/2013 16:03

I know that this an aside, but the share price for Twitter is truly staggering to me. at $50, market cap $27b.

[naphar] 07/11/2013 15:54

Crosseyed,

Meadow is right, in the past reports, they were buying in most of their iodine, some at high prices over $70/kg.

Even in first half 2013, whilst they produced some iodine internally, they had buy in of inventories from 3rd parties second half of 2012 I think and maybe early 2013, I forget. They did that stock in to ensure that they ahd enough iodine for the derivatives business, in the event that production issues with the first plants. As an iodine producer, they thought they would have difficulty buying raw iodine from competitors.

I suspect the purchased iodine was being used in derivatives manufacture in the first half of this year, and that home produced iodine will have gone into inventory, first in first out logic.

That may also be the case in second half of 2013, and maybe also during first half of 2014. I think those figures will still be "muddy" until we have used and sold on all externally purchased iodine.

Even if we start selling our own raw iodine this year, it will probably show as higher cost than $15/kg. Why? Because IO1 does have higher costs due to lower volumes, and IO2 was not at full capacity for much of this year, so economies will not have been realised.

Hope that helps. Certainly I would expect second half 2014 figures to be much clearer, and show nearer the $15/kg level, but even then it is not that simple due to derivtive manufacturing costs etc etc.

[noli] 07/11/2013 15:44

IOF were buying iodine in at that timeframe.

[meadow2] 07/11/2013 15:40

Crosseyed - The period in question would include a relatively small proportion of home produced raw materials. It will be interesting to see how much the raw material percentage costs change as an increasingly large proportion of home produced raw material is used.

[larboulois] 07/11/2013 15:30

Looks like a good question crosseyed or are we both missing something?