Iofina Share Discussion Threads

[bogg1e] 14/4/2014 10:45

It looks like a drift near term, im guessing the market will now sit it out til results. What also muddies the waters is a low of 50p followed by a 60% hike to 80p. Now the news is out, and most of the bad hopefully a thing of the past, the market doesnt know whether its over or undervalued in the short term or at least til results next week. Lastly, our share hoover mr big is now on a cruise ship for two weeks, so unless hes put in big limit orders to fill should the share price drop, his absence wont stop a sell off. Hopefully the renewed forward looking optimism will curtail a drop back to the 50p area at least.

[superg1] 14/4/2014 10:37

Che

re

'I would love the opportunity to grab some more if we fell from here, but I expect the market is too clever'

I suspect quite a few are waiting exactly for that event. I have seen on many shares trading updates pre results and the mms hit the price, then come the results they do exactly the same as if it's fresh news.

re the market being too clever. No, they sly bar stewards. There are a few factors to consider. We have a supply at the moment not expected to last long. If it tightens up pre results day, and you plus others have orders in, then the good old mm's if necessary will drop the price to get sellers to fill orders.

However a fly is in the ointment and it covers the point Josh raises re brunt if buying now.

We have water news pending and that could drop the price is negative, so wipes out the results day issue.

Water could be positive, that should kick it on a decent amount, and then results back to wherever.

But then results now may have the current production rate at the time with io4 and 5 joining in, which if good then in some way negates any Q1 production.

Then the key is the chem div, as that is the revenue earner, and all whispers point to a very good start to the year even on lower iodine prices.

So clear as mud, as we run up to results.

A simple case of being a gambler, or just waiting for confirmation of events and judging whether the price at the time is a good time to enter.

But the there is Mr Big, who clearly states any pull back and he will be loading up more.

Hence once the water and results are out of the way, we can imo look forward to a far steadier share price and in theory, taking all the Chile circs into account as well, start setting an share price uptrend once more.

Water to hearing = in theory some cheaper iodine shares. If the market hit it on results day, cheaper iodine shares.

But then it all depends how much supply is around, as I have noticed in the last few weeks, a few new faces hovering. Many of whom note it looks under-valued.

The key is, IOF are producing, moving forward and have the revenue coming in. While we go on about negatives, they have done in the last 2 years, more than most AIMs I know have done in the last 10 years

[bogg1e] 14/4/2014 10:36

Oh ok, cheers.

[mclellan] 14/4/2014 10:36

I think they seem a good bet from now, after their troubles.
Good luck.

[spike_1] 14/4/2014 10:26

Not 21st per se, 'week beginning 21st.

[joestalin] 14/4/2014 10:23

Bogg1e, 21st April is a Bank holiday - probably 22nd?

[mclellan] 14/4/2014 10:09

superg1- thank you for the synopsis

[phoenixs] 14/4/2014 10:02

Positive tone to the expected rns.
Boggle, I understand what you are saying. However, I think that with Lance at the helm, there will be a greater drive to move the company forward at a faster rate than what has been achieved recently. One only has to look at the balls up re the paperwork for IO4 and 5 permits. I do not believe that there would have been the delays if Lance had been in control.

[bogg1e] 14/4/2014 09:58

21st april. In a week basically.

[josh_ftm] 14/4/2014 09:57

Good RNS this morning! Would anyone happen to know when the EOY results will be released? And when we will know about the water? I'm wanting to top up, but don't want to get burnt on the poor EOYs.Cheers

[bogg1e] 14/4/2014 09:55

As Lance is a consultant he would have been party to the decision to hold the IO plant roll out to IO6. Similarly he would have been party to the decision to roll out 2 minis. I see no reason why the plan should change just because his job title has changed. So i question the idea that we will get minis faster or that we will hit 1000 tpy within a few months. Minis should take us beyond 1000 tpy, but i cant see us getting proof of that til they have been running at least 1 quarter which wont be til the beginning of 2015.

[superg1] 14/4/2014 09:54

mclellan

In short

Like all AIMs IOF are behind where they would like to be and forecast where they would be.

Chile produce about 60% of world iodine, Japan are the other major but you can scrub them as their resource is depleting. Commercial iodine is scarce.

Prices got hit as Chile players scrambled to get a piece of the action on high prices. This $40 to $45 is as about as low as Chile can go, due to their costs.

That is evidenced in reported opex and producers pulling back production. Chile continues to have rapidly rising costs and a list of potentials that will put opex up for them. The affect of their pullback should kick in later this year and in theory should see a rise in the iodine price, as new contract deals come into play.

Production for Q1 this year is expected to be low for IOF as they had some brine problems early Q1, however as they had inventory it will not have affected the chemical division.

In 2012 they practically bought in all their iodine and that would have been at a high cost (probably $65 kg). In 2013 the left over inventory and production saw then through that.

Now in 2014, they will have all the iodine they need plus surplus. I say surplus if chem div orders rise then they can meet that demand within the existing facility.

The big near term news is water. IOF (Atlantis water solutions) awaits the result of a water permit application in Montana. This is to supply the fracking industry with Halliburton as IOFs main customer. None of that is priced in share price wise or any broker note.

So not where they want to be, iodine prices on a low, but yes it does look very good value on these prices.

Results to go, along with the water permit. Once they are done, we all know where we are and can move on.

The water permit could move to a hearing if not awarded, which drags in the wait a bit longer

[bobsworth] 14/4/2014 09:51

As Lance thinks mobiles offer significant upside for Iofina I would not be surprised, with his new authority,that he tries to bring forward their roll out!

Why mobile Mini-IOsorb units could be BIG for Iofina

- Able to target rich ppm iodine brine wells
- Able to produce upwards of 75-100mt/year
- Much lower Capex costs
- Much lower Opex costs
- Hence more profitable
- Lower Capex + greater profitability means they can increase numbers quickly
- Faster hook up means a quicker revenue/profit return on investment
- Quicker construction with no delays caused by extreme weather
- Able to avoid site down time by using a backup mobiles
- Would avoid disruption to brine supply caused by ongoing fraccing
- A growing number of sites to choose from
- Could target high volume brine disposal sites

[che7win] 14/4/2014 09:51

Superg,
Just to be pedantic, there are no negatives in the RNS.

In most other companies, we would not have known the reasons for delays, I believe that the licensing authorities are paying a bit more attention to IOF with the acceleration in plants, but nothing that good planning by IOF in future won't mitigate.

I didn't expect a rise today, neither did I expect a rise on Lances appointment because it was after a 45% recovery in the share price.
Had we never fallen 40%, Lances appointment and today's news would have pushed us into the 80s or higher.

Just as these couple of news items were priced in, next weeks results which won't be great are also known by the market and more or less priced in.

I would love the opportunity to grab some more if we fell from here, but I expect the market is too clever, looking ahead we are probably above a 700-800MT run rate now, we will probably be above 1000MT over the next few months.

The 150% growth comment makes it plain; today's prices provide a nice opportunity for long term capital appreciation.

A P/E around 15 this year against ~150% growth, go figure.

[bobsworth] 14/4/2014 09:43

Nice! "a 150 per cent increase over the fourth quarter 2013"

[malachey] 14/4/2014 09:31

just because they aren't planning any more plants this yr after io6, doesn't mean they will be doing nothing, or that we won't have news to look forward to. What about:

Production updates for the six plants as we go through the year.

Mobile units being built and deployed.

Prilling tower plans - build or borrow.

Water Permit - if that gets the go ahead there'll be lots going on.

[mclellan] 14/4/2014 09:22

A very negative reaction from some posters to what seems like great news.
How surprising.

[1madmarky] 14/4/2014 09:22

RE :The dead period wrt plant builds. If as a result of the review they can knock off a quarter mill or something like that, off the build cost then that's got to be good. If they can modify the towers so that they are easier to clean that would be even better. Perhaps a dual tower configuration going forwards to again reduce down time. Would be nice to get a better idea of what they will be reviewing. But hey we are still on track, just 4 months behind where we hoped we would be.

[superg1] 14/4/2014 09:21

The negative in that rns (plenty looking for it) is that it is many weeks late and probably shouldn't have happened in the first place.

I note your post spike re production/sales.

The only regulatory permit I know of (as fully explained in the admission document)

However, a US DEA (Drug Enforcement agency) licence is needed to ship iodine within the U.S. This is accomplished by filling out the necessary
paperwork to inform the DEA of your intent to become a licensed shipper of iodine. Exported iodine requires 15 day waiting period from the time of notification to the DEA and the planned shipment of the iodine.


So my guess is that someone forgot to do the paperwork and hence the delay. It didn't happen on io1, 2 or 3 (although io3 had that brine sign-over delay)

I don't expect the same to happen re io6

[rhwillcol] 14/4/2014 09:15

I'm happy too, madchick. This is great news! That's a lot of new iodine
being produced.
PS One might even say "A brinary outcome!"

[madchick] 14/4/2014 09:11

Yes, would be great to hear the first week's figures in the results!

Oh dear, I can feel myself going into doubt mode. I doubt they will, though, as I guess the content needs to be approved some time beforehand, so they won't have time.

I may be wrong, though. About everything. Sorry for all the "doubting madchick" posts. I don't know what's got into me today. No harm meant. Just thinking aloud. I'm actually pretty happy!

[shonny] 14/4/2014 09:09

This will be in the sixties after the results. It hasn't exactly taken off on todays news. Mr Bigs two month target of £1 beginning to look a bit sick now.

[che7win] 14/4/2014 09:04

We're used to seeing all the negatives in an RNS, with this one I can't see any! First time since last July we have two positive RNSs in a row.

Off to a flying start, three days production under our belts for the latest two plants and five plants producing - this is a new milestone. I wonder what Chile make if it?

We have this week to see how production goes, I'm sure management will be on top of the new plants sifting through all the metrics.

If we get a good weeks production this week, it would be nice to hear the figures next week alongside results.