Iofina Share Discussion Threads

[crosseyed] 16/12/2013 20:22

gh,

Presumably you mean Iofina's IOsorb plants.

That's a question that has occurred to me. I would think that technological improvement is the main factor in terms of useful life. My understanding is that the equipment could be useful for many years (5 or more?) but the technology is moving so rapidly that it may be somewhat less. It may be, though, that a lot of the infrastructure could be re-used, particularly the collection pipelines, storage tanks, etc.

That is just an opinion, in no way based on any known facts. For what it's worth, I'm assuming 5 years.

[Edit] If you really did mean the brine source wells, I know that shale wells last for a long time, up to 40 years in production, and presumably producing brine continuously during that time. Also the number of new wells is rapidly increasing, so brine supply is not likely to be a problem.
c

[superg1] 16/12/2013 16:45

jr

There isn't a sector as such. IOF is the only iodine related investment in Europe. SQM has other sectors, Sirocco has suspended operations.

On growth and those figures quoted, at 3% growth, that would add around 3,500mt plus by then.

Sirocco were to hit 1500mt, so that has gone, they may return as mentioned, but on their heap leap process of 1000 mt per year, plus some for next year from inventory built up pre close. I very doubt much they will return. In 12 years they never hit their target they were hoping to hit 10 years back. They never produced nitrates after 12 years of going on about it.

SQM were look like they have taken 2000 to 3000 mt off the production market. Cosayach have not recovered from their water issue from 2011 when they went form 6000mt to 2000mt. They planned a comeback but dumped the expansion plan last month.

Algorta have been the one to add to the market, I estimate 2000 to 3000 mt per year built up over the last 2 years.

When you do the maths, with SQM mines closed once the dust settles, in theory there is likely to be a supply/demand tightening in 2014. That's the plan by SQM to keep prices in an area they are happy with.

Then of course there is SCM Bullmine 600-1000 mt who imo will close before long if the price hovers here too long.

[jackabite] 16/12/2013 16:27

Hi guys,

I'm going to leave this thread now and have decided that I won't come back unless Superpooh tries it on with me again. It's best that trolls mouth stays shut though imo!

I hope you all have a merry Xmas xox

[festario] 16/12/2013 16:22

It's 6 minutes to market close... the MM's are leaving it mighty late to engineer the usual end of day collapse in share price
Another leg up tomorrow then.

[the fat controller] 16/12/2013 15:53

naphar,

I'm sure the numbers wont be correct. And you point re sale price has merit, although you could argue that reduced Chile output will keep prices higher.

But the principle is right: that if IOF can keep building plants, that produce Iodine, even at the lower end of expectations, then this share can climb high. High barriers to entry, scarce but vital commodity, and competitors rising opex, all contribute to a perfect storm.

All imho. No investment advice intended.

TFC

[jrjr99] 16/12/2013 15:48

what is the typical p/e in this sector?

[naphar] 16/12/2013 15:46

TFC,

compelling if you believe that IOF can bring 5640mt to the market without impacting the price below $50

It will depend on how long it takes them to get to that level I suppose, how many more current mines are closed and how quickly demand rises.

Even with a $35 selling price, EPS of your example would be 36p.

Even if it takes 3 years to get there, that's also worth holding out for in my book.

[the fat controller] 16/12/2013 15:24

iofra,
That assumes that the rest of the world continue to produce at the same rate. We already know that Chile are scaling back operations, so 32,000 may be optimistic. You have also taken the lower end of the range for Iofina production.

I would estimate 25% of world's production, but the figure is immaterial.

But take 5,640T at $35 (50-15)/kg profit = $197,400,000pa
Deduct 35% for tax (ignoring tax losses)=$128,310,000pa
£1=$1.6. $128,310,000 = £80,194,000pa
127,400,000 shares = 62.95p eps
p/e 20 = £12.59
p/e 25 = £15.74
p/e 30 = £18.89

Worth holding for in my book.

But DYOR etc etc
TFC

[iofra] 16/12/2013 15:15

Hence my range of 15-30%

[noli] 16/12/2013 15:13

You could reduce the 32000 as some mines have closed and companies have reduced output, at a guess it may now be 29/30000. The above is low ppm, when maxsorb/hydrosorb come in, bpd either increase up to 80k i believe and ppm of 800+ but lower bpd on those. It will be over your 17.6% if iof can build the plants and keep the bpd going to them.

[iofra] 16/12/2013 15:07

I think we're agreeing 1410 from 6 x 4years = 5640/32000 = 17.6% of world production?

[noli] 16/12/2013 15:00

6 pa = 1410mt as stated above in my previous post.

[iofra] 16/12/2013 14:51

There will be more than 6 plants in 4 years hence my % of the 32,000

[noli] 16/12/2013 14:39

If you assume all plants go on a 150ppm site @ 30k bpd = 235mt per plant, x 6 plants as stated = 1410mt pa. So on bog standard ppm iof will have nearly covered the 1700mt assuming they roll the plants out.

What interested me more was record high prices for the sector and very little extra iodine produced, that to me is what makes this investment compelling.

[noli] 16/12/2013 14:16

If you look back to 2008, world iodine production was 30300. In 2012 it had only gone up to 32000, so only 1700mt in 4 years.

Then consider the iof growth rate once these plants are up and running, how much iodine could iofina produce in 4 years when you consider the above stat and the industry going backwards as a whole.

[phoenixs] 16/12/2013 14:11

...been filtered for sometime now. He must enjoy writing to himself. Sad really and I feel sorry for him/her/it.

Come back N3TLEY, ALL IS FORGIVEN!!

[crazycoops] 16/12/2013 14:06

sweetnodude,

However in this case is there anything further that they'll know in 14 days time as compared to right now regarding exit rate?

Yes, they'll have more data.

[chutney1] 16/12/2013 14:00

What a tiresome idiot jackanory is!

[jackabite] 16/12/2013 13:54

ansana

Hehe! all good points, which I will ignore. Thanks :)

You won't be ignoring the placing when it lands on you though!

[ansana] 16/12/2013 13:45

I have no idea what Jack...is banging on about I have filtered him like so many have. Is there anyone out there reading Jacks rants? If he knows how miniscule his audience is it might discourage him from wearing out his keyboard. Jacktheunstable, when you go back to the woodshed please remember to close the door.