Jubilee Metals Share Discussion Threads

[kryptonsnake] 06/4/2019 16:11

If some of you believe this is going to 30p I've still got plenty of time to buy in if I wanted to LOLsss

I didn't say Kabwe won't push the price up. I said it won't deliver any profits for 2 years

I've already made money on BMR. If Jubilee makes money from Kabwe, BMR are guaranteed 11% of what ever Jubilee makes

It's in the bank folks, it's in the bank

LOLsss

[goldibucks] 06/4/2019 16:06

GSG yes agree with Jammer’s take on the profit share. A Shard DCF valuation of £19m for Hernic wouldn’t make sense if we switch to 15% profit share when from calendar Q4 19 which was my concern. Also, I remember after the damn breach and slow ramp up due to tailings supply issues Leon saying that due to the terms of the arrangement, the amount that we had to recover before the profit share kicked in had gone up. If the full Hernic profit share lasts into FY22, we probably won’t even notice the 85% dropping out by that point. I’m hoping the Hernic sale to Samancor completes by 20 April. In the March update the business rescue administrators said they expected the last two conditions of the sale completing, the Transnet contract assignment and Eskom contract be “finalised shortly”. Anybody else think Jubilee may have done a deal with Samancor to buy out the profit share? It would have cut their net purchase price and if it doesn’t kick in until FY22, they may have concluded the contract they inherited from Mitsubishi wasn’t worth the hassle. Conversely, Jubilee May have thought the profit share was getting pushed so far into the future, it wasn’t worth buying out.

[goingforarun] 06/4/2019 15:58

Personally annoyed this has moved up so quickly last week. Not getting my bonus until the end of April. Just hoping this is going to be at that level till then! After that happy for it to go to whatever level. Think the future looks very secure now.

[goldibucks] 06/4/2019 15:42

“It's not closed above 3p yet and it won't be long before it's stuck below 3p again”. It’s stuck below 3p now so there isn’t any won’t be long about it. When the market opens on Monday at 8:00, we are going to be stuck below 3p. Logic not your strong point? ;-)

[nelson01] 06/4/2019 15:37

Gold I...absolutely correct....what a sad individual.

[goldibucks] 06/4/2019 15:32

“I guarantee this won't be anywhere near 6p” Interesting how you invested in BMR for Kabwe even though they didn’t have the know-how or financing capabilities to pull it off but now JLP own 92% of it, have the know-how, and the financing sorted, you refuse to accept that it might push their share price up. Every act of stupidity is its own punishment and yours is going to be losing Kabwe as a BMR shareholder and then sitting with us lot out of spite for 2-3 years picking the scab until we make it sing so you get to feel bad about it a second time. You’d be better off cutting yourself off from everything Kabwe and Jubilee and moving on.

[nelson01] 06/4/2019 15:25

Krypton, you make yourself look like a fool every day.

[ileeman] 06/4/2019 15:15

Major breakout of monthly resistance on volume, financial report has perked up the market coupled with large funds taking big stakes. Buy/Hold.


5p target.


free stock charts from uk.advfn.com

[goldibucks] 06/4/2019 15:10

“If you want to focus on Net Cash only fine, from 1H 2018 to 2H 2018, JLP's Net Cash position was worse by £2.1m”

Yes but if £1.5m of that £2.1m is loans drawn down to build the DCM fine chrome plant to make more money in 2019 and another £0.8m is working capital to fund higher receivables, what’s your point? Should they not invest or grow?

You say you’re talking free cash flow but you’re not. Free cash includes replacement CAPEX but excludes incremental CAPEX because that spend is voluntary. When you do that with the £2.4m DCM fine chrome spend in H1 FY19, they don’t have a problem.

You’re claiming that there is a £5m mismatch between profit and cash but there isn’t. You were wrongly comparing project earnings of £4m to a £1m mash up net debt / working capital outflow and saying that’s a £5m gap. That comparison doesn’t make sense.

The number you should be looking at is the £0.8m accounting profit and asking whether that coverts into free cash. They burned £0.6m of cash in H1 FY19, take off the loan draw down of £1.5m = £2.1m burned, then add back the incremental as opposed to replacement tangible and intangible CAPEX of £3m leaves £0.9m. The accounting profit converts into free cash. No £5m gap as you claim.

In 2019 they will have PlatCro chrome, PlatCro PGMs, and DCM fine chrome earnings coming through, all generating free cash to fund more investment and/ or Kabwe working capital.

It doesn’t make sense to start a valuation assessment of Jubilee with Tjate. Everybody knows it’s not viable at the moment, Shard attached no value to it, so that makes you look biased.

[choppernoel] 06/4/2019 15:09

I have owned jubilee from Braemore days. Since Braemore I made several more purchases. I have a substantial holding in jubilee. This company has finally turned. krypton, u are correct, the share price won't be anywhere near 6p. It will be closer to about 18p. If not higher. I'm very pleased that finally something is happening here, and it BIG.

[cptborelli] 06/4/2019 14:31

Does anyone know where i put that circular?

[cptborelli] 06/4/2019 14:31

You said the same thing about 3p

Are you going to keep doubling your target every time it get's there?

[kryptonsnake] 06/4/2019 14:25

And your investment here is a shining example? LOLsss


Let's see who's right when it comes to year end. I guarantee this won't be anywhere near 6p

[plat hunter] 06/4/2019 14:08

What's wrong with BMR lol

[nelson01] 06/4/2019 13:56

Krypton, your past history of investing tells me all I need to know.

[goldibucks] 06/4/2019 13:50

Governments will always struggle to collect the headline rate due to transfer pricing. JLP would want to book their profit in the jurisdiction of their tax losses. What you say makes sense to me. I’d be amazed if they ended up paying anything like 35%.

[redtrend] 06/4/2019 13:44

Goldi - I included trade receivables and payables to be kind as it makes JLP's balance better. Tailings company's have huge build-ups of receivables due to delayed payments from refiners. It does a disservice to just focus on cash + debt. They are rare beasts where normally receivables far outweigh payables.

If you want to focus on Net Cash only fine, from 1H 2018 to 2H 2018, JLP's Net Cash position was worse by £2.1m. At a time they state earnings of £4m.

I'm not talking about accounting profit, I'm talking free cashflow. And as per many posts here, yes many people clearly believe JLP's earnings amount to free cashflow (explicit exception is Sleveen with his new EBITDA G&A metric) and they're rarely if ever corrected. If you think they are persons of "limited intelligence" that is your opinion. I believe it is JLP being misleading and as a producer, they need to report in line with industry standards: it's not hard to provide AISC, Capex costs, Cash position, Debt position and working capital movements on quarterly basis.

As for Tjate, it's an "asset" and people talk about it on here like it can be sold. I care not if Shard included it - I don't pay much attention to a house broker's report on NAV. That goes for any company. So just like Shard, I completely disregarded it.

If Kabwe truly is as profitable as per production guidance suggests, the earnings before tax will likely fall into the top bracket of 40%.

EDIT: As per Goldi's link may well be 35%. Depends what takes precedent but would assume the 35% does. Some mining operations once hit a specific earnings, hit the 40% threshold.

[plat hunter] 06/4/2019 13:43

Cheers Goldi, will do

[gsg] 06/4/2019 13:28

From what I can gather, Jammer's interpretation on LSE of the future Hernic split is closer to the truth, than the Shard note. If so, Shard have made an enormous rickett, and urgently need to correct their note.

[plat hunter] 06/4/2019 13:15

On the Kabwe point Goldi, happy to be corrected here but Jubilee isn't a mining licence holder and JLP company is in fact registered a recycler. By operating unthe cover of the JV combined with JLP's company registration. They side step all taxes and applicable VAT's that have been levied onto miners by the zam gov't.

It is this that makes the re-treatment of tailings in Zambia as a whole an attractive proposition as the VAT saving alone makes it uneconomical for the miners to process their own material.

JLP will be generating revenue as a contractor before any project profits are reported at Enviro mining level

[goldibucks] 06/4/2019 13:07

“Anyone agree or disagree with redtrend's review of JLP on the SLP board.” Yes it’s cobblers, painfully amateurish tosh. Firstly, he’s clearly not an accountant. He quotes “net cash” but then includes receivables and payables in his calculation. End result is a weird mash up of net debt and working capital. JLP made £0.8m in H1 FY19, add back £1.4m of depreciation is £2.2m, they drew down £1.6m of debt to partly fund DCM fine chrome so that is £3.8m, they spent £0.8m funding higher receivables in line with the H1 revenue increase, paid off £0.5m of their payables balance, presumably timing related, increased inventories by £0.1m, paid out £0.5m of interest, spent £2.4m on plant and machinery which ties in with Shard’s USD $3.4m DCM fine chrome cost forecast, and another £0.6m on intangibles. Total cash reduction £0.6m from £6.4m to £5.8m. All very explainable for a growing business. Redtrend reports a £5m “gap” from comparing a movement in his weird mash up of net debt and working capital and quarterly reported PROJECT earnings. A truly nonsensical comparison. The financial analysis equivalent of karaoke.

Jubilee report PROJECT earnings quarterly to show the ramp up of individual projects. Only a person of limited intelligence would assume that was accounting profit or that it was being passed off as such.

So Redtrend kicks off his “review” of Jubilee’s assets with Tjate even though Shard completely exclude it from their 6p price target. Mindset one decade behind where Jubilee are today.

The assumptions about overspend on Kabwe are just his personal opinion. They were slow to ramp up Hernic but didn’t overspend. Their track record and Leon’s experience at Anglo and JLP are on our side.

Can’t argue with his comments about Hernic. The 15% post capex plus return on capex split isn’t good. On the plus side they spent their previously overvalued equity on PlatCro PGMs and Kabwe so Hernic has served them well as an equity money box and shop window. Shard still value the future earnings at £19m on a DCF basis and Q1, Q2, and Q3 profits will still accrue on an unshared basis, firing strong rises in both project and accounting earnings for the next 6-7 months. Also, they own the £13m Hernic plant so at some point they could get 100% of any top up processing and I still wonder if they would have tried to buy more of Hernic’s future earnings from Samancor using debt but haven’t been able to report it to date because of the long delay closing out the deal with Mitsubishi(looks like it could finally get done by 20 April per the end of March update).

The high tax on Kabwe earnings is a good point to note. From my research, the rate will be 35% and not 40% though. Mining processing license holders pay a flat 35% with no additional 5% royalty on top. They presumably have substantial tax losses to shelter SA earnings for a while which will pull down their overall effective tax rate. Also, nobody really knows what can be achieve in Zambia with tax planning, it’s not like companies are handing over corporation tax at the headline rate in the UK.

[plat hunter] 06/4/2019 12:49

The network isn't developed enough for a takeover bid yet.

couple more projects of kabwe's size in different jurisdictions then the M&A eyes will be start to pay attention in my view.

No one buys a company, so that they can do all the hard work, people buy companies once the hard work has been done, otherwise they'd just do it themselves from scratch.

We're safe from M&A for at least another 5 years imo