Iofina Share Discussion Threads

[napoleon 14th] 17/12/2013 18:09

johncs - the last 4 or 5 posts should give you a lead, imo.

[scrutable] 17/12/2013 18:08

Warren Searle

The whole world including you exploits credit, mortgages, and loans, to expand trade and these add to general wealth. Borrowing shares you don't own and selling them is not the mirror image. Leveraging long adds to general wealth, but borrowing to short destroys it. There is a moral difference as in the difference between philanthropic giving and a mirror image of it in burglary or fraud.

It should be illegal to borrow shares to pretend you own them and then to construct a contract to sell that you cannot deliver, and whose delivery obligation you have to avoid by reversing it.

I am sure you are intelligent enough to see that but don't want to miss an opportunity to sneer.

[johncsimpson] 17/12/2013 18:03

I haven't posted so far:

I've spent the best part of the day talking to members of my family who I 'persuaded' to buy Iofina, this after the attempted email communications weren't' cutting the mustard.

Most have a 'paper loss' between 40 and 50% two were going to sell this morning and they wouldn't say how much they would actually lose. (I suggested they sold half).

I have >55% paper loss of a six figure sum which represents more than 40% of 25+years of saving(s) most of it in a SIPP. My position is such that selling would now seem 'pointless' though some would argue IOF has further to fall. I unfortunately was way over-loaded here which in the light of ALL my experience is incredible.

I will try to come back later, possibly very much later depending how my evening goes, but right now, I promised further calls to people who couldn't talk because they were at work during the day. 'Financial counseling' I have discovered, is not a forte.

[the librarian] 17/12/2013 18:01

That sums it all up nicely Che, looks like they decided to follow the lead of the other iodine suppliers and painte as poor a picture as possible, beyond my level of thought.

[napoleon 14th] 17/12/2013 18:01

che - interesting post.
IMO it's very difficult to judge much about the iodine market in general.
Chilean producers have done a U-turn from expansion to cutback/closure & let's get into Lithium! World economy not brilliant, new president in Chile will back workers who are strike-prone & so on.
When experienced big boys are having probs, is it reasonable to expect IOF to have delivered a perfect copy? Their kit works but was experimental not long ago, it is successfully patented and IOF's IP - no one else's, & the roll out is happening, which also depends on suppliers' delivery. For what is practically a start-up, that's not bad but looks bad 'cos too much has been expected of the situation.
Maybe things would have been better run by Lance, but who knows? C'est la vie... As they say, "if you can't stand the heat......"
Peeps concerns are real, but most start-up phases are risky & unpredictable.
Investment in such things, likewise.
Starry-eyed golden scenario investors are NOT Wise.
I'm not making excuses for anyone, but I doubt the IOF team (or anyone else!)would appreciate either BB hype or jibe.

[roboben] 17/12/2013 17:58

lesable - I was really quite taken aback by the contrast between the persona of the poster and the man himself, when I met him. He's a good guy trying to be helpful. Outstanding when it comes to doing original research. Just not so good when it comes to estimating timescales. (But, then, who is?)

This drop hit me hard because I too was stopped out by City before I got a chance to do anything. They held 50% of my position. Not tempted to buy back yet. Probably a mistake. I've made a lot of those this year.

Still see this as a good long term hold but wondering whether there might be better options in the short term.

[jackabite] 17/12/2013 17:55

lesable

your post is 100% spot on, everything about the guy smacks of the BIG I AM...and where is he now after all his banning and regimental dictatorial moderation of this board Kim Jun Un styleee?

You described him to a tea.

[jackabite] 17/12/2013 17:43

superpooh

you got your cloak of invisibility on? cause nobody can see you lol

[jackabite] 17/12/2013 17:42

frog1 17 Dec'13 - 17:23 - 6488 of 6489 0 - 0


The $4.4 million miss is a real concern for me. If it is from a single order, I would be flabergasted if there is a single delivery/payment schedule and is just delayed. The numbers just suggest a cancellation. . Also, forecasting it in the interims then missing suggests complete lack of control. To forecast something like this I would expect a water tight order, but within 6 months they've missed the forecast and the share price is deservedly trashed.

I have always doubted the water permit, but the reason given for rejection when they had some sort of consultants employed again suggests lack of due diligence on the consultants or a lack of proper review of the submission and the consultants work. Then the roll out problems suggest the issues were not thought through properly and then managed tightly. It just suggests the managment view the job as just getting the technology working and leaving the rest to someone else, and then being surprised when it doesn't happen. I don't hold for a second with all these accusations of deliberate missleading info, but I do think they seem to lack a business focus on what in the end is the most important issue, money.

[lesable] 17/12/2013 17:40

I have never met superg1 but have read his posts over a long period. Even choosing his name rather suggests someone puffed up by their own self importance.
The picture i have is Mainwaring in Dads Army !!!!

[hitsha3] 17/12/2013 17:14

Not really, but if you take a dive in the water then you have to learn quickly have to swim. I personally think long term we should be ok.

[che7win] 17/12/2013 17:11

Well, after Friday, I didn't expect another shocking RNS but new management are rapidly gaining a reputation for undelivering and breaking previous management expectations.

It's not good enough to have 1 plant rolled out this year instead of 4, what have they been doing the whole year with the money raised?

It seems that new management are going out of their way to underpromise and overdeliver. I can't help thinking they don't have their eye on all the operations, the vaccum when Lance left has done a lot of damage in my opinion.

If I had attended those presentations I would be up the walls by now.

However, I haven't been forced out at this price (but really feel the pain having bought loads in the last week). Reluctantly, I've bought more because I see the current price overly negative.

If we did get that water grant, the share would soon respond.

Some analysis:

The first three plants " confirms the rollout and successful implementation of the Group's corporate strategy".

"Although not fully optimized, the three combined plants are averaging in excess of 1,000 kilograms of iodine per day, satisfying the Group's internal iodine demand while building inventory for future outside sales."

Optimization on plants 2 and 3 continue. That is initially surprising, I wouldn't expect that on plant 2 but they state " IO#2, .... recently underwent extensive planned maintenance to refresh high levels of iodine production in the tower"

So it seems they need to change the plant parameters because of the additional brine feed?

Why don't they break down each plants output, it's as if they don't want to tell us figures for some reason.

On production levels:

"Although not fully optimized, the three combined plants are averaging in excess of 1,000 kilograms of iodine per day, satisfying the Group's internal iodine demand while building inventory for future outside sales."

In excess of 1000 kg per day shows us the current minimum being achieved. They are rather coy - I would rather they publish the trend over time so we see a steadily rising profile.

What I don't understand is why the build up of iodine inventory? This was something I noted from the interims. I agree with Frog that excess inventory should be sold off at this stage, why the delay? The excess inventory from the start of the year will have to be written down due to the decrease in iodine prices. Do they have a really, really large order that they are fulfilling from India or somewhere?

Good news on the towers, it should mean the next two plants up and running in the next couple of months. They better suprise on the timeline this time - excuses are no longer tolerable.

So on figures:

If the first three plants are doing in excess of 1 MT per day, that's over 365 MT per year.

Add in the recycling and we're sitting at a 400 MT run rate which should be worth 6p EPS (if sold raw or 7.2p through the Chemical plant).

The combined annual production rate from IO#1 through IO#6 is expected to be in the range 700-1,000 tonnes of crystallized iodine. That seems ultra-conservative as that means the next three plants are expected to produce between 120 and 210 MT each or average 165 MT per plant. Surely we expect more than that - are they in ultra-cautious mode? Where are the 50000 capacity plants?

Were previously the old management were far to optimistic, the new management seem to have swung the other way and given themselves unchallenging targets - that is not impressive.

If we work on the median 165.5MT for plants 3 to 6, we have another 500 MT.

So 6 plants should produce 865 MT and mini-sorb plants on top.

The target of 3 more plants on top of plants rollout of plants 4-6 means 6 plants next year or double the current number we have. As Scrutable and others mentioned, it's a delay from the slow roll out this year but also a knock on effect to cash flow rolling in.

9 plants by end of next year with plant 4-9 producing at the median 165.5 MT run rate means 990 MT for plants 4 -9 and a total of around 1400 MT run rate by end of next year.

At a margin of only $25 kg, that equates to $35m or £21.8m at 1.6 exchange rate. Roughly £14m at the full 35% tax which is worst case. Surely a P/E of 15 for the growth is realistic if they actually hit a target next year.

Add in mobile unit and the case becomes more compelling:

"These plants will bring the number of plants to nine with the anticipated inclusion of some additional mobile plants. The planned mobile unit's conceptual design is being finalised and the Company is planning to seek turnkey contracts for construction shortly. The number and location of these mobile plants is under evaluation."

I accept delays on Chemical shipments slipping into next year, they blame the inventory build up on that. That concerns me as it's tying up cash that we should be using on roll out.

Do they have sales of the raw iodine or are they not actively pursuing that?

Management have also been poor at forecasting the iodine price, they made no mention in previous releases even though this was obvious months ago to everyone taking a passing interest.

They need to up their game on a number of fronts, nevertheless, it looks priced in too pessimistically to me - it is still a growth company with next year looking 'exciting' as they put it in contrast to this year.

There are positives scattered throughout this negative update - taking over disused O&G sites would cut iodine opex by $5 a kg I would guess.

I think new management need to be held a lot more accountable - no question about it that it's poor and each update I'm starting to dread.

I agree with their last line " Taking stock of the iodine production opportunities, increased derivative sales and prilling that are open to Iofina, 2014 signifies an exciting year for the rapidly expanding Group."

My interpretation is a takeover by a rival - an ideal time with all the gloom around.

[hitsha3] 17/12/2013 17:10

I can't belive that there isn't even one comment from sg1 and the boys, that's shocking.

[warrensearle] 17/12/2013 17:08

Hitsha breath of fresh air from you today chap none of the normal doom and gloom have you turned over a new leaf ??

[ramu kumar] 17/12/2013 16:57

ck, the directors can fill this gap

[naphar] 17/12/2013 16:56

Josh, I really wondered that myself and would like to know the reason for the delay!

[ramsey11] 17/12/2013 16:54

Probably the Maldives hit

[killerbudgie] 17/12/2013 16:54

Good question, ramu. Why bother building more plants if sales are down and you can't sell the inventory you have? The RNS raises a lot of questions and says to me that the BoD are still preferring to fly under the radar somewhat.

[hitsha3] 17/12/2013 16:53

By the way where is SG1 and the boys gone today.

[monkeymagic3] 17/12/2013 16:52

Give it a rest CK!

[hitsha3] 17/12/2013 16:52

I can hold for another year, no problem. Once we get all 9 plants runing plus portable and water then we will see where the share price is. Sales will happen.

[deanroberthunt] 17/12/2013 16:26

Sorry, we are delaying our RNS until after Xmas, as we want it to be merry.

[josh_ftm] 17/12/2013 16:26

With regards to the stock pile of 2013 iodine which is yet to be sold.

I believe this will be sold in 2014 and added to the 2014 accounts. Why would IOF release there very first profit of a couple of million when then can release the year ending 2014 results in the second quarter of 2015. These results will be astonishing in comparison to previous years and warn the competitors of what we can do.

For me IOF is a long term investment and not about making a quick few quid here and there on day trades.

GLA