Iofina Share Discussion Threads

[superg1] 29/6/2013 15:45

Some good points raised.

I always say assuming delivery.

So assuming delivery of just i2 to 4 up to speed, what would one value those at, per plant on 30k bpd producing on average 500mt each PA.

It has been suggested as £10 to $15 opex per kg.

Using the range range of 250mt to 500mt per plant and just $45 per kg for iodine, it's still $30 per kg profit.

$22.5m profit to $45m profit on on annualised rate. They have plenty of losses to place against initial profits.

If you do the maths, io2 on old brines was turning out about .75mt per day on 18.7k bpd. The extra bod only has to be 300ppm to take it over a 450mt unit.
I think the new brine will be over 300ppm.

I think io3 and 4 will produce more than io2.

If I start using likely opex at 30k bpd and the $60 prices the revenue situation grows rapidly.

If you do the maths, io2 was producing at a rate of 275 mt Pa in May, and at 30k bpd it would mean 440mt, but that doesn't include the better ppm brine it will get.

So all along there has been nothing wrong with my expectations or comments.

IOF have said they have 450mt units, the figures are in rns's, and if you calculate what they have put, they meant it.

PPM mentioned, knocks the expectation for 6, 450mt only works off 300ppm.

Once io2 is up to speed on new brines, and data comes out it will be a wow moment.

Things said about io3/4 and beyond was my wow moment, or more a wowser moment.

So while it may languish after the big dip, and traders doing there thing, at some point, assuming plants built and running at a good bpd, the share price could end up, lagging the profits, by a decent margin.

That is not a view to encourage buys, that's just the way I see it, and what I expect to appear over the coming months.

What the market does can be a different game.

So DYOR, but as far as I'm concerned the business plan is lucrative, and while it's not openly visible to the market, if you carefully at rns's, there are enough numbers in there, to show io2 is lucrative with potentially very good profits in the next 18 months.

There are a few around with higher MC's than IOF, but nowhere near the prospects , with profits in 2015 on.

The bears no which one's they are and they have put warnings out.

In fact the most vocal bear on this website re Avanti was me, but I don't short and was not far into understanding the market.

When I say bear, that is purely down to the figures not stacking up near term.

For IOF the figures do stack up, and while others languish in the doldrums of jam too far tomorrow, IOF won't.

What it will do this week or next, I don't know. Where it will be with io2 to 4 producing at good rates and stated as such, then it will be a lot higher.

So when those are producing, what do you then assume for io5 to 10.

It's not so long back that Investec had generic plants at 105 mt at 30k bpd.

For May, IO2 was on 18.7k bpd or 2.5 times the generic figure on 65% capacity.

Assuming delivery, it will have to re-rate at some point.

[mikkydhu] 29/6/2013 15:03

Here is my view of how the share price will behave in so far as it depends on the company's performance:

The share price will respond progressively as certain hurdles are overcome. The last hurdle will be the large profits that will appear in the bottom line. They are some way off at present. Here are some hurdles:

1. Technical. Does the iodine extraction method work?
Yes. Established by both IO1 and IO2

2. Volume. Can IO2, and then IO3 etc produce the volume of iodine expected
of them?
Probably. We need to see this. It will depend on ppm, barrels per
day and temperature. This may be confirmed any day now. But it
hasn't been yet.

3. Reliability. Will IO2, IO3 etc actually, consistently, produce on a daily
basis the high iodine output we expect of them? This will depend
significantly on the reliability and cooperation of the oil
companies we work with. As more and more plants come on stream, a
stoppage at any one plant will become less and less important.
This reliability is yet to be demonstrated.

4. Monetisation. Assuming that we produce ever-increasing amounts of iodine,
can the company sell it either as iodine derivatives or in prill
form?

5. Profitability. Even if all the above are achieved, will this be done at
great profit? This is a long way from proof.

I do hold a good number of Iofina shares, but I am well aware that the share price will only gradually reflect the full potential of the company as each hurdle is overcome.

[n3tleylucas] 29/6/2013 15:02

Yes, sentiment has definitely changed here over the past 14 trading days. It's gone from "how high" to "how low". It's gone from superg1's intensive posting, to an occasional post. Many heavy contributors have gone very quiet. People are not stupid, they see these things, they feel these things. There is now disquiet, rows are brewing, superg1 will feel he has to ban more posters to maintain order and the message. The next few quiet weeks will be very interesting indeed.

[beercapafn] 29/6/2013 14:45

lets hope we dont see the likes of the LONR fiscisco here.. investors provide all the seed capital, then directors award themselves huge options. then taken out at 10p.. dreadful.

[che7win] 29/6/2013 14:17

Scrutable is a gentleman, he does have incredible enthusiasm. I remember in the early days after reading Scrutables posts I found it extremely hard not to buy.

I will say this, his figures and analysis on the business are spot on and worth noting.

The same goes for Superg1.

Investing is a psychological game and sentiment driven. Sentiment has swung from one extreme to the other this past couple of weeks, meanwhile the business carries on growing with many positives appearing.

No one should be followed on these boards blindly, I am content with my own analysis which I share as others have done for me. Everyone should do their own research.

This stock should be held a minimum of two more years from here, anyone holding on that time horizon will be richly rewarded if the company rolls out on my current expectations IMHO.
There is no point trying to time the markets, give the business time to perform and the share price will reflect it.

[pcjoe] 29/6/2013 13:44

Snap Monts....

[monts12] 29/6/2013 13:41

wayneduncan - 28 Jun 2013 - 23:16:44 - 4252 of 4289
"Scruts - need anyone to hold your hair whilst you're sick into the toilet?

On the plus side - I guess you are guaranteed a nice Christmas card from IG Index???!"

A truly disgusting post and one deserving of a permanent ban IMO. Is it not enough that many here have lost a packet recently without having salt rubbed into their wounds as well?

Never kick a man when he's down......he might get up!

[pcjoe] 29/6/2013 13:39

Wayne - Your post to Scrutable - 4252 - He can fight his own battles but was your following recent post really necessary? -

"Scruts - need anyone to hold your hair whilst you're sick into the toilet?

On the plus side - I guess you are guaranteed a nice Christmas card from IG Index???!"

I`m sure Scrutable has likely lost a packet like the rest of us - As a fellow holder I`m surprised that you take a delight in rubbing it in - Almost a banning offence for you in my opinion - Or were you just trying to be funny?

You failed by the way....

[uppompeii] 29/6/2013 13:15

Not just traders.How many sold out in the fall who were here for the long term? Not just on spreads but shares too? Only Diggulden I think has posted on here he did, and then bought back. I doubt he was the only one, even if it were inadvertent sells on margin calls or stops. Everyone is a trader or weak holder when circumstance goes against them.I don't want to be a strong holder left with toilet paper, been there. I certainly look at the price more than once a month and have a price at which i'll sell, I won't have a loss on these. If that makes me a trader or weak holder so be it.Again, apportioning "blame" is futile. It could also be argued it is the long term holders fault constantly topping up, posting of future sp, pulling in friends, neighbours, colleagues thereby creating a false market, forcing the price up prematurely before delivery really comes on stream. Then being forced to protect profit/lessen losses, self fulfilling and then the short term traders come in maintaining volatility for a number of days.I'm sure many have seen it before, its not uncommon.

[wayneduncan] 29/6/2013 12:33

Answer - no I haven't. But warrensearle has been. Why SuperG? We are both long term holders and believers in IOF. Yet it seems we can't express an opinion.

[testuser123] 29/6/2013 12:28

Neddo - they're a nice company in principle but I tend to avoid anything to do with David Lenigas. Any company he's involved with always tends to print shares like they're going out of fashion, and the placings always seem to be preceeded by a load of ramping from Lenigas via twitter. Once again doesn't mean fastjet won't do well (the business model seems reasonable enough), but it's enough for me to avoid it.

[neddo] 29/6/2013 11:58

has anyone got an opinion on fjet?

[che7win] 29/6/2013 11:16

Naphar,
Thanks for your reply, I've amended my post as you are of course correct.

My view is that there is no point in looking at current year expectations in a growth stock, it always must be looking at the next 12 months and factoring in what the growth is worth back to the current price.

The market currently is very short sighted to me.

[naphar] 29/6/2013 11:05

Che,
I see that as a nice balanced write up.
I would clarify this piece ..."So 16 plants at 200 MT would be 3200MT. A minimum 40p EPS (or £1 EPS on best estimate 500 MT)."... I guess you are saying, on the basis of the assumptions you have defined, the end of 2014 run rate would then be 3200mt, and not that we will produce 3200mt?

[monty panesar] 29/6/2013 11:02

Last week was all about greed and fear by PI's. The big picture is exactly the same. The truth will out.

[che7win] 29/6/2013 10:44

Superg,
It's also in our interests to see the share price stabilise, a fall from here is undervaluing the business and making it ripe for takeover imminently IMHO.

The main points to me:

The negatives:
Rollout delay of IO3, partly due to the decision to move to Oklahoma.

Poorly worded RNS on IO2.

New CEO needed, although Lance still works 30-40 hours per week.

Oil companies in drilling season, delaying brine supply to io2.

Share price got ahead of itself, but not by that much, I think below 200p is undervaluing it.

Too many holders on margin.

The positives:
On IO2: "increased production expected from both full flow and additional brine volumes post the drilling campaign." That is 1000KG per day from production H2 for this plant.

Next year, 50k plants being looked at, providing production around 700MT each. A 50k plant on 300ppm would do 700 mt plus, on 400ppm over 900mt. This would be after I06 and no decision taken yet.

Hyper sites, which from what I can deduce, are not 1000PPM, but much higher capable of 300MT+ with a mini iosorb plant.

Possibly one mini iosorb plant in production at year end.

Prill tower going to Kentucky. will be ordered this year after careful concept and detailed design.

High margins in some of the Chemical division products e.g. etching gases 100+KG.

Montana water app approval expected end July / early August.

Patent news expected imminently.

Dr Fay stated that once on a roll, rolling out one plant a month must be possible.

Dr Fay stated that expectation is for 6 plants by end of this year and a target of 8 for next year.
14 plants at 200mt per year each is about 10% of world production.
At 200mt per year per plant, that is even less than what IO2 did this quarter (on an annualised basis) with weather issues and reduced brines (i.e. very conservative).

Dr Fay stated that OK is the focus for now, so plants rolling out all have high ppms.

Dr Fay stated low teen iodine extraction costs per KG.

Other comments:
Lance in one of the questions at the AGM answered the competition over the coming months will soon become fully aware of what the company can do.

Conclusion:
14 plants by end of next year is the expectation.
I believe that plant roll out will become more routine going forward.

Lets use the rollout expectation of 14 plants but use 200 MT as the production figure to add a significant buffer into the figures. We include a couple of mini iosorb plants at 200MT as well

So 16 plants at 200 MT would be 3200MT. A minimum 40p EPS (or £1 EPS on best estimate 500 MT). That would be the run rate from end of next year, 2014.

Factoring in P/E 20 will become routine when the plant roll outs become routine, you either believe the story or you don't.

Mr Market is in panic mode, I'm not, I have slightly more shares than before last week.

[n3tleylucas] 29/6/2013 10:32

In fact this is now back to February's levels ...

BAGUETTE,

75p? It was only 38p away at one point on Monday. I think this will hit 75p before it ever hits 250p again.

[skasher094] 29/6/2013 10:21

Thanks monty fortunately I'm in a better position than most as
Been in since 20s 40s 120s 140s and 190 and after drop 140 Wednesday
Not bought any over the £2 price partly because of putting up your average each time you buy higher and all paid shares
Personal opinion would be sit on your hands next 3 months and await delivery in part

Appreciation to n3 for post showing where and how to check for share being shorted
Or about to receive bear attention

[n3tleylucas] 29/6/2013 10:13

Dunno mate, SCRUTABLE seems to know a lot about ASOS, maybe he'll be able to answer you.

[skasher094] 29/6/2013 10:12

Mean was asos overbought in same senario early days

[monty panesar] 29/6/2013 10:07

Yes ASOS had major bear raids along the way. Also had the Bunsfield fire to contend with a long the way.

I think you have to understand it took several years to build ASOS into a major company. IOF are trying to do it in a much shorter time frame.

I think people need to start to look at the bigger picture.ie where they will be in 6 months a year and not the next 6 weeks.