Iofina Share Discussion Threads

[engelo] 25/4/2014 23:34

lignum: I agree with your conclusion that Note 14 as it stands is implausible. Some supporting evidence:

As Rockstar states, this is a peak time of year for receivables, due in 60 days after the sale.

If we allow for the IOF Chem contracts moved into into calendar 2014 then surely a fair amount of cash would have been received by end March: from the Dec 17th RNS:

"Overall revenue in 2013 is likely to be comparable to 2012 levels. This is due to expected 2013 shipments at Iofina Chemical now being delayed into 2014. External iodine sales which were previously expected in 2013 are now expected to commence in 2014, resulting in an inventory build-up."

We've also been informed that the first raw iodine sales were made in January.

More straightforwardly, to-day's RNS states

"Realised revenue exceeded target for the quarter due to strong performance of Iofina Chemical;"

For the moment the business is highly weighted to IOF Chemical. There must be more strong cashflow to come post March end to support the 'no need to raise further cash' position.

The sale of investments could of course contribute to this....

Would be nice to have the definitive answer though :-)

[n3tleylucas] 25/4/2014 23:26

A good day for bulls, a few pals made a bit here today, in-and-out, you know.
I now suspect Stena will fund if needed as and when. Value? Need to start making some money, pure spec atm.

[cyberbub] 25/4/2014 23:04

The markets are closed at 17:08:08. It was a worked trade throughout the day. Whether a sell or a buy is difficult to tell...

NAI

[orslega] 25/4/2014 22:50

it was a buy: 40p when bid was 38 and offer was 40.75

2014-04-25 17:08:08 40.00 1,200,000 38.00 40.75 Buy 480,000 O

[crosseyed] 25/4/2014 22:47

I'm confused by the amount of interest at $764,352 charged on the loan (see Note 6).

The original terms of the loan are stated in Note 20. At a rate of 6.5%pa paid quarterly in arrears on $15,000,000 taken out in mid-May, there would be 2 quarterly payments (in August and November) of $243,750 (ie 0.065 x 15,000,000 / 4) totalling $487,500.
Any thoughts on that?

c

[simmy1699] 25/4/2014 22:20

Chaps1.2m sell trade showing. How can I find out if that's a director or II sell??

[naphar] 25/4/2014 22:05

Chr1sJS
thanks, in my rush this morning I missed that sentance in interest rate risk.
however, if they had all been converted to cash ahead of maturity, I might have expected it to be noted as a post balance sheet event. Maybe it should have been a have been / will be comment.

It needs clarification for sure but I have not yet received an answer from the company directly.

I have had an indirect answer which means I believe they are fine for cash, but that's just hearsay as far as anyone except me will be concerned.

[cyberbub] 25/4/2014 21:54

Ammons, I read that statement to mean that RB can only get costs down to $29/kg by limiting their operations to heap leaching, ie. exploiting already-extracted materials, without mining any more? ie. if they returned to normal extraction operations costs per kg would increase substantially. Not sure though - perhaps someone else can clarify.

Yes, hopefully IOF's cost/kg will drop towards the low $20 area, as today's results statement suggests.

NAI

[ammons] 25/4/2014 21:28

Thanks SG.

RB Energy said this about their iodine operations on 31 March 2014:

Iodine

"Iodine operations at Aguas Blancas will be limited to heap leaching during 2014. Production of iodine is estimated at 1,000 tonnes at a cash cost of approximately $29/kg. Aguas Blancas expects to supplement the sales of its 2014 production by reducing the level of its approximately 800 tonnes of finished product in inventory."

So IOF are already on a par cost wise with this established producer with, hopefully, big falls in cost per kilo to come? Do I read that correctly?

[cyberbub] 25/4/2014 21:19

I regret doing this because I think you are both honest investors and you've been around for a while.

Masurenguy
25 Apr'14 - 20:55 - 20141 of 20141 [FILTERED]


Festario
25 Apr'14 - 19:29 - 20135 of 20141 [FILTERED]

[masurenguy] 25/4/2014 20:55

Festario - 20135: Measurengay... ALL your earlier posts were rants!

How utterly childish. I've already challenged you to substantiate such a claim. You haven't, because you can't as it is just pure BS. Just more typical troll behaviour !

[superg1] 25/4/2014 20:47

Ammons

it's a case of reduced brine while they syphon off brine from pipelines, I.E. They reduce the amount going to an swd as they are 'nicking it'. E.G. If Chess did 100 Wells they may need 10 mill barrels of water or 10 months worth of supply to one swd.

So spread across various swds you can see how the disruption goes on. However 100 high cut miss Wells would then mean 500,000 bpd of new brine needing to go to an Swd. Hence the comments about once done they are swimming in the stuff.
Sandridge (with iof) plan 300/400 Wells and already have of 100 swd sites. It's a boom in play, like the early bakken period. Hence anyone with sufficient cash could dominate the iodine sector with iof tech patents and contracts. The opex just proved that

[ammons] 25/4/2014 20:09

Yes Festario, iodine production of 400T based on the fracking program of the next 3 months (known) being the similar for the following 3 months (unknown) and the 3 after that (also unknown). In 3 months time we might hear of another projected production cut when the current 3 month program is nearing its end and the next is announced to IOF. I hope not.

Also, SG1 hinted at fracking water being reused before we get it.

"In OK the produced water is sufficiently clean to re-use, so Chesa would tap into the pipelines to take water for fracking, that's where the disruption kicks in." Post 19874. Depending on the number of times the water is reused (if SG is correct) is this not inversely proportional to the total volume of water we get to extract brine from? If the same water is used twice we get half the amount of water had it been used only once??

[nearlyman] 25/4/2014 20:00

A question has been put to me about the increase in the inventories. I know this was stated to increase in a RNS in December as sales were shifted from 2013 to this year, but do we know those sales have taken place and been paid for?

[rock star] 25/4/2014 19:57

What TW forgot to remember in his calculations was "receivables". If the sales in Iofina Chemicals were ahead of expectations in a business where sales have historically been heavily biased towards the first few months of the year then they are likely to be due a lot of money in for the sales since payment is typically around 60 days after delivery.

Historically cash has bottomed at this time of year.

With Iofina Chemicals you have to remember this: Inventories tend to be highest at year end due to forward contracts due for delivery in Q1. Cash then lags sales by around 60 days.

Having said that IOF tend to highlight the negatives.In Dec stated the inventories as being high and March highlight the cash being low.


Big7ime 25 Apr'14 - 18:27 - 20131 of 20135 0 0


From TW, can he be so wrong?


I first remind you of a timeline of events. On 26th and 27th of March I posted two articles HERE & HERE which, inter alia, suggested that Iofina was almost out of cash but also noted that Iodine prices had tanked and that trading must also be dire. I predicted that a profits warning was inevitable.

Yesterday, 22nd April, Iofina duly served up that warning and also stated that on 30th March cash was $2.3 million. It did not disclose what trade payables were not did it say what net cash was as at 22 April. In these days of electronic banking surely it knows what cash it has on a daily basis?

[festario] 25/4/2014 19:29

Measurengay...

ALL your earlier posts were rants!, Now, stop being peevish please, and you continue to invite criticism by persisting in using bold type. You have been asked nicely, but to no avail.
Now, I have family things to do, a nice meal out with my Mum who is visiting, and my long suffering wife.
No need for reading glasses, you will be delighted to hear that my cataract operation was a great success only 2 weeks ago. (Thanks for asking)

On Monday, perhaps this board can revert to the issue of cash flow and production of Iodine, and hopefully you will have revised your font settings so that we can all follow the discussion. Is that too much to ask?

[lignum] 25/4/2014 19:22

Re cash: the Annual Report has been carefully worded and is encouragingly detailed.
It is therefore unfortunate that it states 'Subsequent to 31 December 2013 the investments were converted to cash.' This implies a cash outflow in the period to 31 March of 2.1 (cash 31 Dec) + 6.2 (investments at 31 Dec) - 2.3 (cash at 31 Mar) = 6.0m.

This is not plausible as total current liabilities at 31 Dec are only 3.7m with contingent liabilities for further capital expenditures of 3.5m. There could only be a 6m cash outflow if all these liabilities were paid in full, or if there were a huge build up of inventory / receivables in Q1.

Despite the implausibility of all the investments being converted to cash in Q1, the Company's credibility is such that I think it needs to confirm that Note 14 is incorrect.

[masurenguy] 25/4/2014 18:48

Festario - 20130: "Measuring Guy"

Still can't decipher my username huh - better invest in some reading glasses !

"You also go off on a hell of a rant to convince everyone that you are not gay. Why would you do that? Who cares? How do you know that I am not gay?"

LOL - please reproduce or reference "the rant" to which you refer.

[big7ime] 25/4/2014 18:33

And he likes to bite the hand that feeds him too, bulletin board morons

[festario] 25/4/2014 18:24

Measuring Guy,
You really need to keep an eye on that blood pressure, Sir!
I am certainly no troll, despite your time consuming attempt to selectively find posts of mine from YEARS ago which taken out of context show me in a bad light.
You have way too much time on your hands, and a bee in your bonnet with me personally.
You must have read through many HUNDREDS of my posts to find those ill judged ones, and you must have noticed that the vast majority are either pertinent to any company I am discussing, or a little tongue in cheek.
You also go off on a hell of a rant to convince everyone that you are not gay.
Why would you do that? Who cares? How do you know that I am not gay?

Now, we got off on the wrong foot, because I (and several others) have asked you in a very civil way to please stop posting in bold fonts. It makes a real mess of this board when reading it using apple devices.

[engelo] 25/4/2014 18:12

crosseyed: could be that a half decent headline end March cash position (+ $2m sounds infinitely better than - $4m) was top priority and they decided to cash in the investments ahead of natural schedule, presumably forgoing interest and maturity returns, to achieve this.

If so a little sleight of hand, so hope this is not the case.

[crosseyed] 25/4/2014 17:49

Chr1s et al,

I would agree that the Investments of $6,198,821 referred to in Note 14 Financial Instruments are closely equivalent to cash. At year-end, the effective Cash+Investments position was $8,268,755.

I'm not too sure whether the statement under Interest Rate Risk...
Subsequent to 31 December 2013 the investments were converted to cash.
...should read "will be converted to cash". The investments mature at monthly intervals from January to August 2014. As it also states...
Surplus funds are invested at either floating rates of interest or short-term fixed rates. The benefit of fixing rates for longer term is kept under review having regard to forecast cash requirements and the levels of return available.
So why state that, with the detailed list prior to that, if they have already cashed the investment?

On that base, $1,716,319 of those investments (plus yield interest) would have matured by the end of March. That would still leave $4,482,502 (plus interest) to mature in the following months. So effectively, with the cash stated at $2.3 million at the end of March, Cash+Investments would actually be about $6.8 million.

It seems a very odd way of stating the "Cash" position though, leading to much angst amongst investors! I eagerly await the response from IOF on whether that interpretation is correct.

c
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