Iofina Share Discussion Threads

[atino] 04/5/2014 19:16

Hi, does anyone know how to upload pictures...in a post ???

[engelo] 04/5/2014 19:15

Naturally impatient for next RNS and April production figures (but of course these may not be great). HOwever there's the strong possibility that given a little time good news from negotiations with Chesa on brine flows could come out at the same time, which would be hugely positive. Also plans for mini manufacture/deployment must soon be publishable.

Many thanks SG for details of Chile horror story: Imo iodine price MUST rise on the back of it. World demand if anything will continue to increase as the supply continues to dry up. IOF have an open goal if they can get their boots on.

The golden scenario is that H2 sees I03-6 getting decent brine flows, I07 and minis built and deployed in the right locations, and all taking advantage of a revived iodine price. Imo this is entirely realisable.

Then project into 2015....

[n3tleylucas] 04/5/2014 19:11

The gap-fill failure rally to 48.5 of the 54 is disappointing. I sadly expect the shares to fall significantly from here to test and then breakdown through the major support at 16 over the coming months. The news being told maybe sounding good, the chart behaviour is telling a different story entirely. The shares are now looking doomed to failure.

I suspect Stena has already written this off, leaving Arron Banks as the new lender of last resort. He will only commit so much to this, then it's down... to Graham & Co. Let's see if they put their money where their big mouths are, eh.

[hurricane.] 04/5/2014 17:15

From FT today

4/5/14

Iofina highlights tech start-ups' burden

By Kate Burgess

"Somebody is going to get hurt," a reader warned in December when Small Talk urged Iofina, the iodine producer beloved of chattering online traders, to bring investor expectations down to earth.

He was right. Shares in Iofina, despite the breakthroughs in extracting iodine from the waste brine thrown off by US oil producers, have fallen from £1 to 40p since January. They had already taken a pounding in previous months.

Iofina's woes illustrate how quickly technological innovations, however sure they seem to make money, can be derailed.

The first sign of crisis emerged at the end of March when Chris Fay, Iofina's chairman, quit and Iofina's board stopped expansion plans and initiated a review of operations, costs and cash flow.

In mid-April, Lance Baller, the co-founder, was parachuted in after a year's absence to take the chair. Two weeks later he told shareholders that production would miss market expectations by a country mile and the company would have to slash costs and staff to conserve cash. The company's pre-tax losses widened from $1.2m last year to $3.8m.

Last week, the chief executive and finance director quit and Jeffrey Ploen, also co-founder, stepped in as interim chief executive for a salary of just £1. Midweek, Iofina issued a convertible bond to a US investor to give it headroom.

Mr Baller and Mr Ploen, self-styled "go-getting guys who get things done", argue that some of Iofina's troubles are out of its control and, they hope, temporary. The company's main supplier unexpectedly chose to use its brine in fracking rather than push it Iofina's way.

But the founders are frank about the previous management team's mistaken strategy of "growth at any price". "While small companies are given a period of grace at the start, even for them, the only things that matter are earnings and free cash flow," says Mr Baller.

He and Mr Ploen have already identified $150,000 a month in costs that can be cut without affecting operations. They have also identified the next chief executive, but would rather let him get on with the urgent task of rescuing Iofina without the distraction of dealing with shareholders.

That may or may not be a salve for investors' wounds. But Iofina's plight illustrates how big the burdens of disclosure and maintaining relations with shareholders are for early-stage technology companies struggling to turn good ideas into commercial successes.

[orslega] 04/5/2014 09:21

Roboben - yes, that describes pretty accurately what blinkx has just experienced - Assistant Prof Edelman (Harvard) in sustained attacks on the company....unsubstantiated and incorrect claims about its ad software - paid "research" by two hedge funds and a whole loads of shorting in place.....a perfect catalyst to tear the pants off any share price...and pretty much nowt anyone can do.....

[orslega] 04/5/2014 09:13

yes, well worth a read that SG1 link.

From all these recent press articles, news bulletins etc it does seem Chile is facing huge internal issues on many fronts which must surely impact its ability to compete on terms seen previously. Chilean iodine producers are responsible for over half of global market. The likes of SQM will not be immune from economic reform planned. Logic says that iodine prices seem likely to rise. Hopefully in time for the brine supply to reach IO#3 - IO#6.

Roskill research 2012:

"Production is dominated by Chilean and Japanese companies, which accounted for an estimated 58% and 32% respectively of global output. An estimated third of Japanese iodine production is secondary so Chilean companies are the leading sources of crude iodine. The most important producer is SQM of Chile, which produces around a third of global crude iodine".

[roboben] 04/5/2014 08:42

I spotted the following on a QPP thread. It was posted by thecat on 3rd May.

I don't think that we were subject to the kind of shorting attack that they experienced but I certainly found it informative and interesting. There's a lot to read and useful links to follow.

It's the best explanation of how a concerted shorting attack can be orchestrated that I've seen.

Here's what he posted.

This makes a great read, makes sense why there are more buys than sells yet the price ends down.

[masurenguy] 04/5/2014 08:24

superg1 - 20661: Higher prices are relevant. Chile reported that not me. It's not widespread in the media, it's just a post to identify trouble is brewing which may heavily impact the iodine supply market. If the find was that China had found a rich cheap source of iodine and started flooding the market with it, then I'd want to know about it before the market.



superg1 - thanks very much for the relevant input and also the above link.

[bocker01] 04/5/2014 00:06

Naphar, it is not based on discussions with the BoD.

[benny hanna] 03/5/2014 23:09

What Iofina could use at present is an "off-take" agreement, whereby a buyer commits to buy all or a pre-determined volume of raw iodine over a certain period of time. IOF can't produce enough at present to compete for the larger wholesale contracts so they have to sell into the spot markets, and even then, only when internal needs are met. Given the volatility in the wholesale iodine marketplace (Chili in particular, as well as globally) that revenue (and discounted cash flow) would serve as "ballast" to future sales growth, and more importantly, serves as collateral for future financing if cash flow wont support it. I'd also like to see a "farm-in" for the water, if/when the permitting issues are resolved. Same for oil and helium assets, being non core as well. Lance, can you pull this off?

[1madmarky] 03/5/2014 22:38

Thanks for posting the links it's all good and along with everything else going on in Chile it points to higher iodine prices in the future. Which is great news that we should be able to benefit from once we sort ourselves out

[superg1] 03/5/2014 22:13

Have a read yourself




12/18 months ago the entire market was talking about the great and wonderful Chile investments opportunity.

[superg1] 03/5/2014 21:52

Not sure if anyone actually read the link but it said this.

'as organizations before individualized declare that no reply by the highest authority of our country, we will initiate an indefinite strike'

Note the 'as organisations before individualised'

I didn't post that list of 40 plus unions, but it includes-:

'federation Cosayach'

and the federation of port workers.

I don't know anything else called Cosayach other than the miner Cosayach in that area.

Cosayach is the mine that has been selling iodine cut price and is rumoured to have cash problems.

If Cosayach workers go on an indefinite strike then that will disrupt the cheap iodine supply and may end Cosayach.

So personally if Cosaych and others are going on an indefinite strike here it's very relevant.

It's not just about iodine prices, it's about long term supply agreements which is something IOF will be looking to achieve when excess production is in play.

The point is the problem was brewing before the earthquake, and while it seemed there was no obvious damage the fact is many are living in tents, with health and other services disrupted and they have had enough and it seems have called a widespread multi union indefinite strike.

So personally I'll be watching out for any further information in the coming days and weeks to see if this has momentum or will be short-lived.

[superg1] 03/5/2014 21:09

I'm not suggesting the iodine market is going to be hit. All I did was search to see for any Cosayach action and came across a report in Spanish which suggests the entire iodine producing region may end up with employees on an indefinite strike.

That could mean a short term spike in iodine prices for all I know. It could end up with weeks or months of disruption. It could be nothing. The fact is reports showed SQM employees Are totally p'd off with their home and working conditions (mid April), including similar topics listed in that general strike.

After all Chile producers in a battle drove the price down. If mines go on strike for any length of time, the supply market will be hit and prices could rise. It may send those struggling in Chile over the edge.

Higher prices are relevant. Chile reported that not me. It's not widespread in the media, it's just a post to identify trouble is brewing which may heavily impact the iodine supply market
If the find was that China had found a rich cheap source of iodine and started flooding the market with it, then I'd want to know about it before the market.

[monty panesar] 03/5/2014 18:33

Think Bocker is being over demanding. Look at HAWK who give monthly production data. They typically report on 10th-17th of each month.

[naphar] 03/5/2014 18:10

Bocker
When you say production numbers were meant to be Thursday, and must come Tuesday, is that based on discussion with IOF, or just your personal expectation given the month is complete?

[monkeymagic3] 03/5/2014 17:47

Not sure I really get the relevance of Chile problems at the moment.

It's like saying every JCB in the world has broken down so we are the best because we have got a bucket and spade.

Long way to go yet.

[monkeymagic3] 03/5/2014 17:42

Cyberbub- you may be forgetting who these directors actually are. I don't think they will exactly be on the bread line. I'm not complaining but let's be honest with ourselves, it has been done out of necessity, that's all. If not for the financial impact but for the desperate need to get investors back on side.

[bocker01] 03/5/2014 17:38

They needed to start restoring some confidence after a run of unbelievable incompetence, simple as that. It's not worked yet either. Not at 40p. So they need to pull their fingers out a bit more. Transparency is needed with production figures on Tuesday. They should have been on Thursday. How long does it take to add the final day's production to the previous 29? We also need news that talks with Chesapeake about more brine are going well. The technology works. What has not been working is the previous incompetent BOD. Thank heavans for the change. The company has so much going for it.

[cyberbub] 03/5/2014 17:07

Monkeymagic 20652. In other companies short of cash the directors often take their salaries in new shares. The fact that our directors have not seems very positive that they have all shareholders' interests at heart (as well as their own!).NAI

[dcgray21] 03/5/2014 15:28

Well said Monty and shows what a profit making machine IOF could be if it can execute . As Rockstar said , IOF survived the debacle due to its inherent low cost base

[monty panesar] 03/5/2014 15:07

The most important first step is to get iodine production back to around 1t per day. At that point they will be supplying sufficient iodine for the Chemicals division.

If they have costs around $25/kg they should with the vertical integration and value enhancement of the Chemicals Division be making $20-25/ kg Gross Margin which then more than covers the corporate overhead. Once the get over 1t production they start making the surplus cashflow to expand the business going forward.

[monkeymagic3] 03/5/2014 14:11

It doesn't actually but you may interpret it as such. We are not entirely sure that IOF could AFFORD to pay them, it could be no more than that.

[sandbag] 03/5/2014 13:31

"Further, the two recently appointed non-executive directors and the Company's Interim CEO have reduced their compensation to GBP1 until further notice"

That tells me the technology works and the share price will head one way only.