Iofina Share Discussion Threads

[tsmith2] 27/3/2014 19:16

Thanks panesarDo we know when the water permit news so be in the offing?

[monty panesar] 27/3/2014 19:14

I am assuming that is the case as I have seen it many times before. Many funds are not allowed to have cos. under 100m in their portfolios and so become forced sellers. Usually means the bottom of the share price as creates false low.

Sort of circumstance which explains why majority of funds perform so badly.

[woodpeckers] 27/3/2014 19:08

The great bit about today's RNS for me is that I feel the company has 'grown up'.

We have our 5th plant complete.

But perhaps more importantly, they have confirmed that "the Group's WET(R) IOSorb(TM) technology patented process has proven itself to a high level." Where was the fanfare for that...? Huge achievement surely....

We can expect two mobile units up and running this year and they have "some very high parts per million (ppm) but low brine volume sites where the units can be economically deployed." Again, round of applause from me.

We can expect more updates next month and water is all on track as far as they are concerned.

They intend to review and tweak where necessary... who can complain about that?


I'm in it for the journey and hope we don't get taken out too soon...

[tsmith2] 27/3/2014 19:02

Panesar - where have u got that from?

[monty panesar] 27/3/2014 18:57

It looks like some fund is having to sell on the sub £100m rule. Seems crazy but rules are rules. As a v long termer here mega surprised to see them back at these prices. Sorry for those guys showing a paper loss.

It still strikes me as a cracking growth story with an expected CAGR better than I have been able to find elsewhere. The next 3 months is about maximising the output from the existing plants which will then provide the springboard for the next wave of growth.

[bobbyshilling] 27/3/2014 18:55

Does anyone know if the mobile units will be subject to regulatory inspection and approval every time they are deployed? (I can see that it might apply initially). If they are not, then it seems that is the way to go, to monetize the higher ppms quickly, then move on, and all the time having IOs 1-6 steadily producing.

I have no real complaints about today's rns - the next one will be a biggie regarding water.......

[writz] 27/3/2014 18:23

Re the review, it seems to me there are a number of variables they're trying to assess, including variations in ppm, continuity of supply, issues with supplier close-downs and weather, equipment design parameters, operational reliability/maintenance, likely development patterns of O&G drilling, and their overall bottom-line performance curve. Put all that together and I can see that they'd want to observe all their plants over a reasonable space of time to get a picture of just how well they're doing. Investors and competitors won't get much of a sniff until they complete their analysis, but at some point later in the year, and unless the calculations so far have been disastrously wide of the mark, a solid forward plan based on known facts will emerge, probably against a background of strong iodine demand and operational profitability, and possibly of a near-monetized water business, and then - I'm guessing - the long awaited ping may be heard. But not this week.

[bobsworth] 27/3/2014 18:06

diggulden Yes. I should have gone to specsavers! Post edited.

[diggulden] 27/3/2014 17:49

Bobsworth 27 Mar'14 - 17:22 - 17674 of 17676 0 0

diggulden not that it changes your thinking on anymore IO plants this year but they state "This review, scheduled for completion in the autumn"

Not sure your point?! Q3 is the autumn.... so the same thing?

[ammons] 27/3/2014 17:38

"Surely the review shows the real problem is the fact that the company have no control over the brine they are supplied with"

I think the review is clearly about cash management and optimising what they have now before deciding whether or not to go ahead with further full size plant, mobiles or funding water or whatever. If they had zillions in the bank they could do the lot at the same time. They don't have zillions in the kitty so common sense must be applied.

Not sure how you have worked out that brine supply is the real problem when all the available info does not show that at all IMO. The supply can be problematic at times as we already know but is that the "real problem"?

[bobsworth] 27/3/2014 17:22

diggulden I totally agree

[freshvoicem] 27/3/2014 17:19

Surely the review shows the real problem is the fact that the company have no control over the brine they are supplied with.
If the oil co. Change what is going to our plants then we may not get anywhere near what we had hoped per plant.

[diggulden] 27/3/2014 17:14

engelo, just to be realistic, I don't think there will be any more IO plants this year.

If the review is not taking place until Q3, there is no way sites will be sorted, parts ordered and arrived and construction organised and finished by the end of the year. The best we can hope for in that respect is a similar track to this year, to maybe bring 4 plants online on H1 next year.

The minis are potentially lucrative but this needs to be proved.

Iofina have come along way in the last 2 years, they have chosen to have 6 plants running at 100% instead of maybe 10 plants running at 80%, that's my view anyway.

Is the potential still there? Of course it is, it is just going to take longer.

Bottom line is IOF will exit this year with a run rate of anywhere between 700-1200MT per annum, even in 2 years, that is quite an achievement.

[engelo] 27/3/2014 17:07

oldtown: One of the main bull points of IOF is that it is the lowest cost producer in the world I believe. The main world suppliers in Chile have costs around $40, just over or just under the current market price of iodine, so simply uneconomic atm. They are closing mines and reducing production, so shortage of world supply is certain at some point in 2014.

Simple maths taking IOF's opex as $20, then margin of 100% if iodine price is $40, but double that at $60 iodine.

IOF forecast recovery in the iodine price in H2 and resumed rollout in H2 will take advantage of this.

[tsmith2] 27/3/2014 16:18

Someone being filled at 54p?

[oldtown] 27/3/2014 16:13

The questions must be asked, do the actual costs of producing the iodine equate to more than to actual market value of the iodine? Is that why they have shelved/ slowed down in the roll out?

[broncowarrior] 27/3/2014 15:33

The problem I always had with people on here is that a PE of 25 was appropriate. Reduce that to 10 and a price in the early 100s would be appropriate.

having said that I once bought at 210 so I didn't trust my gut.

[broncowarrior] 27/3/2014 15:22

Haha Dean. My view on this is I'm stuck with a loss so I now need to take a long term view on it. Building up cash which underpins the price is a good way to stop this swinging wildly in price. We aren't likely to see 250 any time soon but should move back towards a hundred once cash flow can be demonstrated.

[bocker01] 27/3/2014 15:17

The company had roundabout USD12m of cash/cash equivelents in its balance sheet at the end of December if the various brokers notes are to be believed. Of course, they contain the only information in the public domain that is likely to be credible. What's more, the chemical company is no longer buying in iodine from outside. Difficult to see why people think the company's about to run out of cash (unless they think George has burnt it all in his back yard). I wouldn't be surprised if quarter 2 production figures lead to t/o interest developing.

[jasp2] 27/3/2014 15:11

About 1.5m green (unknown) trades today. Seems to be unprecedented, at a quick glance.

[deanroberthunt] 27/3/2014 15:11

Bronco...

you'd see impending death as a positive....

[writz] 27/3/2014 15:01

What you see in the RNS depends a lot on your time frame and expectations. Long term it can be read as the company easing itself into profitability and allowing an assessment period to maximize potential. Short term it puts a damper on the possibility of IOF roaring back to its former share price on the basis of rapidly increased production. The technology is certainly disruptive for the sector, and the market for iodine isn't going to go away; but figuring out how to implement IOsorb to best advantage clearly hasn't been the clear run most investors dreamed it would be last summer. As usual, hope runs ahead of reality. But acceptance of the water application will bring the short term back into focus, and another delay in that part of the business doesn't kill the underlying business plan, just makes it a slower burn.

[broncowarrior] 27/3/2014 14:39

I do see the RNS as a positive to be honest, build up a cash pile before looking to expand. What is wrong with that exactly. hippo, another absolutely drossmonger.