Iofina Share Discussion Threads

[ammons] 21/12/2013 18:01

The article is no more or no less misleading than management being somewhat over optimistic about plant roll out and deployment. That said, I see the current position as being a bump along a likely bumpy road faced by a growth company like IOF and management now being more cautious. Rightly so. I like the fundamentals and will be sticking with it. Nothing is guaranteed or set in stone and by sticking with it I might lose ALL of my money. I accept that risk. I do not blame SG1 for my decision as some of you here and elsewhere seem to be. The way some of the lunatics on here are going on one would have thought that company is on the verge of going bust. Iofina could make a killing here IF IF IF they deliver.

[bocker01] 21/12/2013 17:33

Napolean, that is not just margin it is cash. Internal consumption of 30,000 kg per month x USD25. In otherwords USD750,000 per month of cash is now being saved compared to H1 2013 because Iofina is now using its own iodine rather than buying it in. Infact the difference is probably higher because the cost to Iofina of iodine from third parties was higher then. So imo if the company was not financing cap-x it would be very cash generative. Imo it has already financed the vast bulk of the current IO4, 5 and 6 rollout. It could cut off cap-x now and remain cash positive with those plants waiting in the wings.

[che7win] 21/12/2013 17:24

On the Chemical derivatives comment and description about it being a 'technical sale', IodiTech have previously described it as below:

On chemical margins IODITECH says this about their margins:

" Economics would say that iodine is an elastic demand material. Higher prices should reduce demand. However since iodine is primarily used as a raw material, and not consumed strictly in and of itself, this is not necessarily how the market is being affected. Oil prices directly drive gasoline prices, and gasoline is consumed throughout the world, and especially in the United States, as a direct budget item. High oil prices = high gasoline prices = less driving, and less demand through conservation. Potassium iodide, IodiTech's largest product line, is typically used at a less than 1% inclusion rate in products. In many of these products, the potassium iodide contained in the product may represent less than 0.01% of the product's overall price. In these cases, iodine prices could triple, quadruple, or more, without significantly impacting the product it is used in.

Iodine derivatives share a further unique property – they are occasionally inelastic to price in that they simply have no substitute. X-ray contrast media testing is an excellent example of this. The test has to contain iodine, otherwise it isn't an x-ray contrast media test. Dietary use for food production animals is the same. Dairy and beef cows, poultry production and swine production all require enormous amounts of iodine products, with no substitute. Again, prices can become as high as the suppliers want, and the animal still has to have its daily supply of iodine."

[che7win] 21/12/2013 17:21

Napoleon,
Yes, the article is flawed in places, not taking account on the margins now being achieved with supply internally of iodine to the Chemical derivates business.

That should be an extra ~$25 dollars margin per kg sold overall going to the bottom line.

[napoleon 14th] 21/12/2013 17:17

Contrarian Investor needs to get with it....

1. "Time will tell in January whether they can overturn the DNRC's decision".
Nothing needs overturning, just an answer to a request for "further & better particulars. Doesn't mean it's a done deal, & if the info. is not of the right sort, then the water deal is unsure. However, the info required is not rocket science, is it?
________

2. "new production from Chile in 2014 will keep a lid on prices".

Oh! Really? New prod'n?
Not SQM or Sirocco, is it?
LOL!

& again - " Iodine prices likely stuck at current levels for the foreseeable future with Chilean production increasing this will certainly hamper the companies efforts to improve margins and profit"

Not exactly in touch with the iodine market......
My take is that Chilean prod'n is being reduced to help maintain iodine prices within Chilean opex of US$40-60.
As opposed to ours of US$10-20.

________

3. "With the cash burn as it currently standards it looks like more financing will be needed in the 1st half of 2014"....

Somebody tell him what CAPEX is, please?
There's a plant roll-out programme going on.....
________

I'd agree there's a credibility problem due to shortfalls,
but no mention of what has been achieved, nor IOF's opex,
nor an accurate take on the situation in Chile.

Misleading IMO.

[bobsworth] 21/12/2013 16:35

naphar 20 Dec'13 - 13:39 - 13764 of 13882 0 0

Bobsworth, re 13752,

Did you get CAPEX and OPEX muddled up?
I think Bogg1e told you mobile CAPEX is about a fifth of a big plant, not that the OPEX is about a fifth

naphar afraid so! thanks

OpEx: (Operational expenditure) refers to expenses incurred in the course of ordinary business, such as sales, general and administrative expenses (and excluding cost of goods sold - or COGS, taxes, depreciation and interest).

Capex: Capital expenditures are expenditures creating future benefits. A capital expenditure is incurred when a business spends money either to buy fixed assets or to add to the value of an existing asset with a useful life that extends beyond the tax year.

So anyone know how much cheaper the OpEx is per MT on a mobile compared to a fixed plant?

[bobsworth] 21/12/2013 16:26

"have the potential to be huge cash generators "

Finger crossed this will start happening in 2014!

[orslega] 21/12/2013 15:29

[Proactive link removed]


"Director deals: Iofina chairman Fay bags over £150,000 worth of shares

By Ian Lyall December 21 2013, 10:00am

He bought just over £150,000-worth in two tranches at prices between 100p and 101pHe bought just over £150,000-worth in two tranches at prices between 100p and 101p

It has been a rough week for iodine producer Iofina (LON:IOF) with the share price down around 33% in the last five trading days.

The fall was precipitated by a trading update, which lowered earnings and sales guidance and gave a fairly dour assessment of the market for iodine.

The miss, however, was more of a timing issue as it said a shipment had been delayed.

And it revealed that even in the current environment, Iofina is still making a decent margin on its low cost production.

In fact the current shake-out could have a long term positive impact as some of the higher cost producers bow out and prices rise.

Iofina sees this happening in the second half of next year.

As market makers are not normally given to assimilating such a nuanced assessment of prospects, so the red button was hit and slide began.

This is natural, there is always a degree of overselling (panic), which provides and opportunity for those savvy enough to follow their gut instinct.

No doubt Iofina chairman Chris Fay believes he has bagged a bargain acquiring stock in the company at depressed levels.

He bought just over £150,000-worth in two tranches at prices between 100p and 101p.

At the moment he is out of the money. But this looks like a long-term wager on the potential of Iofina's technology, which can extract valuable iodine from the brine found when drilling for oil and gas.

It will complete its fifth and sixth facility in the US in the first quarter of next year.

They have the potential to be huge cash generators and this supports broker Investec's 230p a share price target.

In a recent note it said little had changed with its forecasts, though it added that iodine prices were "slightly below" its assumption.

Investec is predicting revenues of US$18mln this year, rising to US$77.5mln next year and then US$117.8mln in 2015, with the latter figure resulting in a pre-tax profit of over US$50mln.

If Investec's predictions are correct, then Faye has indeed bagged a bargain"

[mail2] 21/12/2013 15:23

a must read to me

[harry3021] 21/12/2013 14:03

Iofina proves an expensive investment as shares plummet by Contrarian Investor

[ammons] 21/12/2013 14:01

Agreed Monty.

Sensible, sober comment seems to be lacking on everything related to IOF at the moment.

[nofool] 21/12/2013 13:57

Question is - did superg bank his profits before this crash?

[superg1] 21/12/2013 13:30

Oh the brave anonymous posters are abound.

Keyboard warriors that infest just about any social exchange website around. It will be lonely xmas for them I suspect.

[monty panesar] 21/12/2013 13:15

Nothing wrong with what Superg has said IMHO. Market taking more cautious view of expectations after recent delays. Delays are small compared to most growth companies.

[napoleon 14th] 21/12/2013 13:08

I was about to say I'd OD'ed on this thread & would take leave until real news, as opposed to endless "nice me, nasty you" type posts,....

until STARFISHPRIME's post. Priceless!
The most inteligent/welcome post in ages here.
I'll stay & only take notice of real news & GSOH.

[ramu kumar] 21/12/2013 13:04

SG's rambling post 13865 - it's the Bears and the BOD that brought IOF down. He's absolutely blameless.

Not one apology or remorse - such arrogance, unbelievable!

[ramu kumar] 21/12/2013 12:46

Post 13867 - excellent. Best Christmas gift for all IOF investors!


I'm going to read it every time before I buy any stock.

[starfishprime] 21/12/2013 12:43

Norland SUS

[kcowe] 21/12/2013 12:34

Wonderful post STARFISHPRIME.

[jungmana] 21/12/2013 11:53

SG whats gone wrong here? Last time i looked in this was 200p. Also have not seen you at GDL lately with your 'intelligent analysis'. Lol!!!

[superg1] 21/12/2013 10:05

Paid rampers?? Yes there are, but not on this BB. It's called the BOD.

There have been a number of presentations attended by funds and PIs along with documents in existence that give guidance no different to that shared here.

All had the chance to go, listen to the BOD, and speak to them afterwards. Brokers were there, Investec, and Stena. Many spoke to some or all of them, and all were very buoyed by what was said.

We all know the guidance given in that time, including a number of plants this year. If we go back to the early ones then there should have been a water depot built in spring of 2013, going on guidance.

Also this year it was suggested pod or two should have appeared. Thus on the guidance given by the company the following should be in place by now.

6 producing plants
1 water depot with H2 of revenues with more permits in play
at least one or two pods producing.
Triple digit growth
Dividends about now.

That is what was said.

At the AGM it was said by CF the water permit would be 45 days (impossible and I mentioned that to a broker present) and up to 6 plants by the year end. Although he did say, io6 'by the skin of our teeth'

IO3 was always 'soon' and I did note the 'cut the turf' comment v 'being built'

In late Sept, it was once again stated that 6 plants would be built by the year end. Knowing they take 3 months at least, it seemed a fair bet that most of them must have started the build process, if not why say so. Pods would not be around as they are trailer mounted and they wanted designs to combat possible wind issues.

IO4 was said to be 4 weeks behind io3, but then they mentioned at some point the towers were 4 weeks late, so I thought 8 weeks. However then came a numpty error on io3 with the brine sign over, one that should never have happened with a bit forward planning.

Then we learn suppliers have let them down re tower delivery timelines.

Now we see there were clearly some errors by the engineering firm re the specifications, and a query over beneficial use, which for now (until advised otherwise) I think is the water bureau's confusion re Hal/IOF relationship.

At the various meetings, everyone form the old and new BOD has been present at some point, including the company secretary. The only one I believe hasn't attended is Forrest Dorn.

They came to London, Leeds and Birmingham I believe. So those with a big interest had the chance on at least 5 occasions (3 presentations and 2 AGMs) to meet the BOD and discuss the business with them. Presentation documents exist with much of the detail on.

There was no need to rely on anything here. 80 plus attended each event including the last AGM.


So where are we v that.

Pods next year but they said that late this year.

Io6 being built now so surely by end of Q1.

io4 and 5 advanced stages of building. No idea what the photoshop comment is, please don't tell me someone conspires to suggest the photo's are false.

Water permit, talks or hearing in the near future to sort out the raised queries.

So in fact what was supposed to be around by now, is now suggested has slipped into Q1 14, with a question mark over water.

The last rns 'not fully optimised' tells us the plants were not running at full rates and we have a 1 mt plus 365 to 400mt rate, just 1.1 hits the 400 mark.

So no, not paid rampers here and a bit of a juvenile comment, just investors that were assured delivery would come with 6 plants by the year end.

Post that last presentation I recorded many posts saying it's no issue to me if it's slips into Q1, as most seemed obsessed with year end dates. I didn't know it would, I just wasn't holding my breath

On that point IOF have an order that has slipped into Q1, a big order some are told.

So the promise now is 6 plants by the end of Q1, if I go on photo's then io4 and 5 look certain if they get the towers. I would like IOF to tell us if and when those towers arrive, instead of leaving us guessing.

IO6 started it's build but after all this I'm not convinced it will be complete in Q1 going on past performance. So It's up to IOF to keep us up to date on that front.

I didn't expect IOF to become an example of a company in delivery mode v those impossible fail companies/positions mentioned before.

I could list a few here, but won't. They are currently on high MC's, some very high. They are there as they are in promise mode, with revenues and actual start of deliver set for late 2014 and some way beyond, so for those shares there is nothing to fear, and investors pile in. At least one I know of will report whacking great losses and has been for years, but while in impossible fail mode investors are safe. The problems will come when delivery fails, and it will fail for some of them, that's what the stats show, most of them will fail.

The bears listed a few they intend to target, they haven't yet, they will wait until delivery time and make a massive issue of any slight slip and go into attack mode, sometimes it works for them sometimes it doesn't. In recent months GBO and Cupid and been targets, they have been working hard on GDG recently too.
IOF got the same, but there was nothing really to pick on so they scratched around, fortunately for them the BOD did all the delivery they needed. Most AIMs fail to deliver, so more than 50% of the time if bears pick on all performers waiting for delivery, then they are going to profit. Much o that profit is created simply by the fear they put into investors which causes in some case exaggerated drops, as investors flee in fear.


So now IOF is in the 80's with io1 2 and 3 built, io4 and 5 80% built and io6 started.

Potentially the water permit sorted and a depot built this year.

Everyone seems to be talking about the high MC impossible fail shares, and are bullish.

There are a few other shares actually about to deliver that have not attracted the same attention, and hence lower prices, so those are the ones that attract me.

That includes IOF, the timeline slipped, not a lot changed other than some poor management of delivery on promises THEY made. So going forward THEY have to gain the confidence of investors by demonstrating delivery.

However I know the iodine market is a good growth sector, and I know from a lot of research that Chile opex costs are very high, with mines closing. That will mean a tight demand/supply point at some time in the future. Based on Chile actions I expect the price of iodine to rise in 2014. So do others in the sector.

It could fall, but the indicator suggests not, as a fall would mean iodine suppliers competing on costs, and selling at a loss, so this is unlikely. Unless of course the odd Chile mine see's the opportunity to put a rival out of business by taking a short term hit themselves, to kill them off.


Do I want the likes of GDL to fail, no I don't, I hope investors make a packet, fortunately it's not one of those on ridiculous highs. Why? because it hasn't delivered as promised, the highs this year were when impossible fail was around, and in theory I agree with posters there, it should have broken 30p and 40p based on the company comments.

Now it languishes I suspect while investors wait for the GDG court case outcome, I hope it's good, but the bears are there lurking with their reports posted waiting to stampede through on any slight hint of weakness.


The same bears trashing this the share predicted a 250 breakout, I did warn to be very wary of them.

Finally take a look at PLE, there is a pump and dump for you, the bears tipped it, drove it high, then dumped, and shorted posting the opposite view calling investors mugs.

Fortunately those in early over there still made well, but those that bought on recent highs won't be happy, check the thread, you will recognise some names trashing it having used others tags to pump it up prior. I must look up that analysts name at some point.