Ironveld Share Discussion Threads

[rec0very stock] 18/10/2022 18:38

LADESIDE I do own shares in IRON - I attended the GM as a shareholder. I used to own a lot more than I do now, you would be one of the people who bought them from me, which is why I like you so much.

Al of course I could be wrong, but the figures don't lie. It could be a £5.5m black hole or a £6.5m black hole which ever way, it is a massive black hole and true to form the company breaches AIM rules by omitting key facts. Could a white knight eg Grosvenor come along and bail them out, of course it is possible, but there would be a painful cost to bear.

Is it better to act on imperfect information (because the company has deliberately ensured we only have imperfect information to work with) or wait until the worst is confirmed (as it will be in the annual report) and the share price has totally cratered?

[al101uk] 18/10/2022 14:11

RS,

You make all of your arguments in absolute terms and have completely ignored the point of what I said.

We could be wrong.

If you don't accept that then you are more guilty than Ladeside of the things you accuse him of.

We've been on this merrygoround before.

Cheers Ladeside :-)

[ladeside] 18/10/2022 12:08

Do you post on any chatboards that you OWN shares in Recovery ?

Just wondered, as it remains a complete mystery to me why you spend so much time and seem to take it so personally the goings on at a company in which you have no interest ??

Keep pushing your agenda though as it makes no difference to me nor the share price, it's just rather tiresome, that's all.

Al, I see you as pretty neutral and a very good poster for what it's worth....

[al101uk] 17/10/2022 23:07

Lloyds is only a bank in the sense that it's a piggy bank and scape goat for politicians.

The UK has made so many sectors uninvestible, banks, energy & utilities being but three. You can add UK retail to that too if you like.

At least I can sit and watch the same government as has been in power for the last 12 years tell us all that the country is f'cked... it's nice to get some honesty.

I own some Lloyds by the way, even after swearing off them during the Financial Crisis... :-D

[aceuk] 17/10/2022 22:00

Well, in effect being a life and pension company for the last 25 years hasn't done Lloyds a lot of good!

[al101uk] 17/10/2022 21:52

Ace,

I was doing so well until that mini-budget, showing a profit for the year and good headwinds for my portfolio to outperform.

Rising yields and an easing of S2 was certain to make life & pensions companies a great investment over the next few years... as long as bond yields didn't get too volatile :-/

I guess fun is one word for it ;-)

[aceuk] 17/10/2022 21:38

al101 the last few days have been so much fun :-)

[al101uk] 17/10/2022 18:58

"RNS neatly avoids mentioning the £6m funding black hole"

That's not the only option. It could be that we're wrong about the funding black hole (we disagree on quantum, but I agree that working capital isn't covered).

Would have been nice to get some details on the debt deal as they obviously have some numbers to pump in to the interest bearing years of the model published in the analyst note.

[al101uk] 17/10/2022 18:42

Ace,

I think I was being positive, but then I can't be sure anymore.

I'm a bear to the bulls and a bull to the bears, such is life.

[ladeside] 17/10/2022 16:10

Very good update today where we're finally seeing things start to fall into place.

Today's share price will be a distant memory (similar to Truss) 4 weeks from now.

Keep clutching at straws Recovery and surely even you can at least acknowledge that today's update is very positive, given the doom and gloom which you've been spouting for months.

The fact you're doubling down with your garbage speaks volumes imho.....

[rec0very stock] 17/10/2022 12:45

RNS neatly avoids mentioning the £6m funding black hole - another breach of AIM rule 10.

Those 2 x 10m sells at 0.26p have worked it out though.

Keep averaging down at these crazy prices!

[aceuk] 17/10/2022 11:23

Operations to commence almost immediately

[ladeside] 14/10/2022 13:40

She's certainly a nightmare but is currently a dead woman walking.

If she sees out October I'll be extremely surprised.

[purchaseatthetop] 14/10/2022 11:19

I keep on hoping I wake up and find out the Liz Truss rule was simply a bad dream……

[aceuk] 14/10/2022 11:16

Still sheltering from the joys of life al101 😉

BTW The Scarecrow has landed and Dizzy Trasher has announced a press conference later but not given a time .... stagger, stumble, stagger!

[al101uk] 14/10/2022 10:57

I think it's difficult to get any deal on debt done when interest rates and currency volatility is so high.

Interest rates are up substantially:

hxxps://tradingeconomics.com/south-africa/interest-rate

But then the model in the note uses 16 Rand to the $ (even though it claims to use 15) and comments that any weakening in the Rand offers upside. Rand now trades at 18 to the dollar.

The other positive is, who the hell else would want to buy a do'er up'er smelter in this economy... so Ironveld may believe their strength is that all other options are worse.

It would be no surprise to hear that GC is squeezing so hard that the deal is on a knife edge. The question is will it all end in a bloody mess.

I'd be shocked if the financing for the smelter deal isn't RNS'ed.

[ladeside] 13/10/2022 18:49

I'd say the exact opposite actually, if this deal falls through it will be because we don't want to proceed, however I fully expect it WILL complete and reckon it has already done so as I mentioned previously.

Incidentally, Ladeside won't be averaging down at 0.36 as he's already done all that he requires at 0.26 and is now happy to sit back and watch events unfold whether it be for richer or poorer......

[al101uk] 12/10/2022 19:17

Ladeside,

Truss is why I'm hiding out here, it's a sea of calm compared to my portfolio ;-)

I agree with the consolidation idea, doesn't look good having stock priced at a fraction of a penny even if it shouldn't make a difference.

[ladeside] 12/10/2022 13:15

I think Ironveld is the least of our problems right now as Truss and Kwarteng would appear intent on completely destroying what's left of our already failing Economy. Add to that the fact that Bailey has had enough and has now gone "rogue", then I think we're in for a rather bumpy ride.....

[ladeside] 12/10/2022 13:02

Remember we have the warrants which at some point are likely to raise further funds at 0.30, they've already been priced in as a negative yet ironically are above the current share price and haven't been factored in currently as a positive.

I also wouldn't be surprised if the DPA wasn't RNS'd on completion as the company have more or less confirmed that it was a mere formality. Knowing how GC worked in Amer, we could get an RNS in a few weeks which will give a far more substantial update on where we are in terms of refurbishment along with the fact that the DPA was already signed off and possibly something else included, that would be typical GC.

Who knows what will happen, but it wouldn't be outwith the realms of possibility to see a share consolidation (possibly 10 to 1) and then a further cash call ??

Like everyone else here I've no idea but I still like the odds at current share price ....

[rec0very stock] 11/10/2022 20:31

Time will tell. We ride the waves as we see them and take the consequences of our own investing decisions - my decisions to sell when I did seem to have worked out very well for me so far, even though I took a very small loss.

We are now approaching 6 weeks from when we were told the DPA would be done in 2-4 weeks.

There is a £6m funding black hole to fill somehow, if the DPA does happen.

I remain very happy with my tiny shareholding and am not tempted at all to average down as that is a fairly sure way to end up taking a much bigger loss, because you only lose if you sell is a lie and there is not reverse Newtonian law that what goes down must go up.

[al101uk] 11/10/2022 20:03

If you base your assumptions on the note from a while ago, but factor in a placing for working capital you can get an idea of a basic valuation.

I'd use a placing price of around the current share price, that means an additional 1.56 billion shares. I'd use the notes estimations for their discounted cashflow at around a 10% discount (I've used something between 8 and 10 for simple numbers and rounded at 1p per share on current share count).

That means with an increased sharecount of 4.46 billion shares in issue the discounted cashflow can be re-adjusted to 0.65p per share.

I'd say this is the central case.

Obviously worst case is the smelter deal doesn't complete and on that basis I'd value the company at a million quid, but to be fair writing off your capital at that point is probably not unreasonable as substantial further capital investment is likely... I'll use 0p because it's easier and it's close enough.

Best case is probably a placing at something above 0.25p, if we assume the price doubles on sentiment when/if the smelter deal is done, we get half the dilution and a valuation based on that of 0.78p per share.

...and now arbitary percentage chances:

Lower Case: 25%
Central Case: 50%
Upper Case: 25%

So on a risk weighted basis that gives a current valuation of 0.5p per share.

On RS's metrics, I reckon he'd come in at 0.03p per share or lower (5% chance of mid case) which is a market cap of £500K.

I reckon Ladeside will have a scenario better than the ones I show, but probably comes in mostly on the upper end at 0.78p.

Remember this is a risk adjusted valuation, it's not where you expect the share price to be, the situation changes, Ironveld likely won't stand still once the deal is done and will be looking at ways to increase capacity further... they may do some other financing deal to get the working capital... but these seem like small percentage chances at this point in time and are not things the company has hinted at or that are mentioned in the note.

Also, just because I've put a valuation of 0.5p on the share doesn't make it a buy. You have to factor in volatility, risk and management history. This is just a base case from which to work using only the fundamentals of the business. Personally I wouldn't buy the company until I know they are fully funded to profitability, but that doesn't make it worth nothing.

edit - I didn't even really think much about my percentages, so I wouldn't assume them as my view, more an illustration.

Looking back I'd probably use a higher discount rate than 10% in the current environment.