Iofina Share Discussion Threads

[diggulden] 15/1/2014 21:24

Andyhayward,

I think your figures are a little optimistic.

Firstly, Iofina Chem only currently uses around 400MT per annum, so only that amount will have the derivatives mark up. The amount of profit made is unknown, but I have personally factored in an average of 15% above the contract cost of Iodine, which currently stands at approx $50KG.

So I would say $57.50 per KG revenue on the 400MT that is processed through Iofina Chemical.

The remaining amount would be sold onto market, assuming we can sell it. We are trying to gain market share from the competition so our pricing may be low to start with to gain the new business, I would assume $45KG as a conservative sales amount, leaves plenty of room for upgrade.

So based on 700MT production. I would say

400,000 KG x $57.50 = $23,000,000 for derivatives revenue.

300,000 KG x $45 = $13,500,000 on open market.

Total of $36,500,000 revenue, based on production AND sales of 700MT of Iodine both through Iofina chemical and onto the open market.

This assumes they can sell all 700Mt of course, which doesn't necessarily have a time scale. Being an Iodine 'supplier' is a new market so will take time to harvest relationships I would imagine.

The figures do give an idea of what CAN be achieved though, the potential is quite fantastic. 2000MT of production and sale gives revenue of over $100,000,000 with what I would expect to be a profit figure of $30-$40 Million. I think we will prove over the next 6 months that we are a serious production company, then we just need to prove we can sell it profitably.

One thing is for sure in my eyes, we are drastically undervalued at the moment. I would still hope to see a share price of £2-3 within the next 12 months.

The BoD have a lot to do to repair confidence first.

[freshvoice] 15/1/2014 21:24

Andy
Looking at numbers and times I think these are rollovers not buys.
Price would have risen a lot with that size of buy.
Don't know if anyone who was watching L2 can elaborate?

[superg1] 15/1/2014 20:45

No....... let them hang on for a little longer

[andyhayward1990] 15/1/2014 20:15

2013 Review and 2014 Outlook RNS

"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."

So revenue wise we're looking at 2014 as between (using $60 per kg):

low:

700 * 1000 (to kg) * $60 = $42,000,000

high:

1000 * 1000 (to kg) * $60 = $60,000,000

I have notes from the agm stating that Profit margin is $40-45 per kilo confirmed by Dr. Fay at the 2013 agm. Is anyone able to fully confirm this?? Naturally this gives very substantial profit.

Obviously this is just the core iodine project not counting any of the other oil/gas/water revenue streams..

Bears have had an absolute field day here, but they will be concerned at the level of buying today. There were 3 very chunky trades around 13.37 today which were filled orders from the price walkdown over the past couple of days:

360,000 @ 95.375 = £343,350
100,000 @ 95.375 = £ 93,375
260,626 @ 95.375 = £248,572

Big money is attracted at these prices, two of those trades were the biggest this year. Bears will be closing if they're smart, otherwise I'm sure everyone here will happily see them get burnt.

[captain_kurt] 15/1/2014 20:11

In that case your in luck...Q1 is all about newsflow and presentations :@)

Shortly we will see what happens when newsflow and sentiment change imo

[n3tleylucas] 15/1/2014 18:36

News here is always a joy.

[rhwillcol] 15/1/2014 16:08

che7win: I think you're right! High volumes and some large buys. The shorters know that their time is now getting very "short", what with near-term presentations, new funds buying, and news being imminent.

[che7win] 15/1/2014 15:55

Jack,
Similar position to me then :-)

[jackster193] 15/1/2014 15:50

Me too Che7win :) I was waiting for 92p to top up but decided to grab 10k @ 95.435p. Onwards and upwards!

[che7win] 15/1/2014 15:46

I smell shorts closing.

[meadow2] 15/1/2014 15:43

Did Investec resign or were their services dispensed with? Could be significant!

[superg1] 15/1/2014 11:16

Scrut

I'm completely confused why you still hold on. That early first quarter well from last year still hasn't been reported on. The recent news sounds like a repeat of last year with once again the mention of the Chinese new year.

10 wells ????? $1.5 m 2 months each to complete.

A possible 250 wells more, do the maths. So are they talking that many over 2,3 years as they can't complete those in one year, not that they completed the numbers they promised from last year.

The last one 100 wells in India with just 5 rigs and staff to train. 6 lateral well would wipe put 1 rig for a year at least

How many rigs have they got left in China, some are off to India. I think it will be around 20.

Just as before it doesn't add up, best of luck.

As always with GDL the rns news doesn't match the maths.

Many have wised up to it now.

Then what about that pending GDG court case? I thought that was to be concluded early this year and it looked very damaging for GDG should they lose, and that wouldn't be good for GDL.

[sandbag] 15/1/2014 10:46

" I'm half thinking they would welcome a material IOF, to help finish off some of the smaller mines."

And I'm wondering if Lance met with SQM on his visit to Chile last year and I'm wondering what was said - not that I'm suggesting anything underhand went on but it would be interesting to know what each party learned from the other.

[superg1] 15/1/2014 10:23

Since when did Lance leave, he resigned from CEO he hasn't left, not as fit as he was but certainly not gone.

The water meeting seems to be getting some airing.

If the meeting goes well potentially it could go to PDTG, and they could update the site before an rns is out. Rns news takes time to be written, sent to the nomad, reviewed then released, we have seen this event twice already where we know water news before an rns.

Re the meeting

'If the information provided is adequate, DNRC will create the preliminary determination to grant the application and the application will move to public notice as discussed above'

So what do they need to provide, we'll put in a bigger pipe/pump and no none of the water is intended for ND as in out rns and letters of intent to buy water.

But then that is not the core business as they keep telling us. But if they get it on a 60 cents to $1 pb range it's £11m to £18m with 80% plus of that as profit, so where does that fit in with the current price.


IOF keep going on about the core business and by more than chance that's why we keep going on about Chile and it's issues because iodine, however boring and unloved it is, has been as sector on a consistent growth and scarce resources.

Any price drop sector is ignored that's the way of the market, price drop = avoid. Just look at gold and all the comments over the last few months, no explanations are needed re gold.

5 plants shortly with more to come.

Personally I think SQM are making a smart move, and I have an inkling what their plan is, re taking on the other Chile guys, while SQM go for operational efficiencies, by closing the high cost depleting mines, I'm half thinking they would welcome a material IOF, to help finish off some of the smaller mines.

SQM are large enough to think about mid and long term plans. Others haven't been so sharp, chased the boom and the tide is now receding fast. This year we should get to see what they are wearing, and personally I don't think it will be pretty for some of the smaller mines.

Meanwhile way in the background and down the road for IOF, horizontal drilling begins in the Nisku to the west of IOF's land, the same Nisku that runs entirely under their acreage that Weil resources have been looking at.

The longer IOF sit on that land, potentially the more valuable it becomes, it has no serious value now, but as others do the exploring East and West it may well turn into a valuable asset.

[microcline] 15/1/2014 10:09

N3 A quantum mechanics aficionado perhaps?

[che7win] 15/1/2014 09:52

Bryproj,
Just be careful, he thinks it should be at 230p and 75p simultaneously, can't work that one out myself.

[bryproj] 15/1/2014 09:49

Just topped up 10k on the back of Nettlies v. useful valuation technique..

[ansana] 15/1/2014 09:45

Che thanks for the reminder about Netley's blunt tool. Netley I am grateful to you for pointing out where this share will go £2.30. Thanks, time to buy a few with io4 and io5 just around the corner. Did someone say presentations on the way this month? I think they did. Not much of this month left so if you are going to make a presentation about your company it stands to reason you will have plenty of positives in there. How is IO6 doing hmm... Yet another reason to buy a few. Even the weather is OK in OK.

[scrutable] 15/1/2014 09:24

Fellow PIs are well aware that I have grimly held to a large holding in GDL
throughout the continual slippage in share price during H2 2013, confident of the well drilling tests being conducted by CNOOC and SINOTEC, two Chinese super majors and their two further supermajor associates.

This has at last been vindicated by an RNS this morning, announcing a $15m contract for the first 10 LiFaBriC geo-steered horizontal wells worth $15m out of a total 150 worth $225m to come this year from Green Dragon Gas, and up to a further 250 similar wells(worth $375m)from the Chinese super majors.

This heralds very big business from a small, but leading, technology company,

In the words of engineering CEO Randeep Grewal:

"We expected to conclude 2013 with a significant backlog going into 2014 and indeed we do. While the first quarter will be predominately a ramping up period, the quarters following should be robust. Two customers confirmed so far for 2014, could demand up to 250 wells drilled while we expect to conclude additional incremental orders with our other Chinese clients."

Obviously DYOR

[che7win] 15/1/2014 09:20

Oh,
Make no mistake, the share is not trading in relation to the business or it's prospects right now, it's an opportunity that I'm taking advantage of.

P/E 9.5 this year, probably half that for next year, too early to say ( ignoring water ).

Using Netley's 'blunt' formulae, according to him we should be around 230p.

TUNG, forward P/E of 63 next year, IOF 4.5 (conservative)

[uppompeii] 15/1/2014 09:13

Just email the board your thanks Che!

[che7win] 15/1/2014 09:00

Interesting trading this morning,
MMs on top of their game today. They were happy to gather a lot of shares this morning, they dropped it only slightly, seemed reluctant to drop it further this morning with mostly sells.

At 93.75p to buy, I was hoping for a further fall of a few pence, I guess a lot of others were too. It's called greed.

Then they raised the offer on a couple of trades and kept raising it.
I was looking to buy some around 90p, but the MM knew there were a lot looking to buy on a turn here.

I have obliged and bought more on the turn, nice to be aboard with more ahead of the presentations.

I half expected some news this morning, usually a Wednesday is a likely date.

Those deramping have done their job for now, lower lows as expected, a lot of noise.

I'm pleased to get a second bite at this price, thanks to those who helped me achieve it.

Ps: the MMs probably accumulated shares these past few days, they were always going to move up quickly and get buyers coming in at some stage.

[florence10] 15/1/2014 09:00

More dross to filter!

[superg1] 15/1/2014 07:57

Br

Did you not read the numerous media comments

As far as the market is concerned the water permit was rejected.

The meeting isn't do or die, they clearly need to make some changes to the design. It's pipes and pumps, so either the pipes or pumps were not big enough (or both). The beneficial use has been covered by a few, and mentioned in many areas re a query if the plan is to supply any water to ND. No there isn't, it's pure speculation.

So come the meeting, the design change will either be in place or proposed to be in place, and the beneficial use side explained as for Montana only as detailed in the rns.

The depot is close to the ND border, but it's there because that's where the Montana oil well action is, and that's where the Missouri is.

The media post water news said the water permit had been rejected, which as we know is not the case.

It can only be concluded at the meeting to the positive side, if there is still an issue, it goes to a hearing.

Down the road even if it went that far to rejection completely, IOF have the rights swap deals in place, then there is another option.