Katoro Gold Investors - KAT

Katoro Gold Investors - KAT

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Stock Name Stock Symbol Market Stock Type Stock ISIN Stock Description
Katoro Gold Plc KAT London Ordinary Share GB00BSNBL022 ORD GBP0.01
  Price Change Price Change % Stock Price Last Trade
-0.05 -2.38% 2.05 12:26:55
Open Price Low Price High Price Close Price Previous Close
2.10 2.05 2.10 2.05 2.10
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burtond1: Are we entering a commodities supercycle? And what does it mean for small cap investors?https://total-market-solutions.com/2021/02/are-we-entering-a-commodities-supercycle/
grahamwales: Hurry up and get this plant sorted. htTps://www.kitco.com/news/2020-12-31/Retail-investors-see-gold-prices-pushing-through-2-300-an-ounce-in-2021.html Retail investors see gold prices pushing through $2,300 an ounce in 2021
grahamwales: hTtps://www.southernsilverexploration.com/site/assets/files/3982/why_is_metallurgy_test_work_important.pdf Junior resource companies need funds to advance their projects toward production. Convincing investors and banks to part with their cash means management must continue to de-risk a project to move it to the next stage. Once a company has successfully identified a deposit and delineated sufficient resources, the next step is development and mine construction; an expensive undertaking that’s also risky for investors betting on whether those resources are in fact economically recoverable. The higher the recoveries (the percentage of a metal extracted from the ore during processing), the higher the profit margin and the quicker investors will see returns. Positive metallurgical testing results tell the market not only whether an operation will be feasible, but also if it will be profitable
grahamwales: Ed The way I see it the price reflects possibly couple of hundred thousand turnover and no profit. If they get this project up and running then could be looking at £2 to £3 million profit in 3 years time. Sounds a long way away and for traders it’s a lifetime however for investors it’s not that long and price won’t go up overnight but 20p or so in 3 years time will be very lucrative for potential investors. Prove up Haneti and farm it out then look for more tailing projects. DRDgold seem to do quite well out of it.
dozyduck: GW Re projections. Yes I might have doubled counted into costs some of the items in an AISC or AIC. But I don't think what was used for the scoping study could have included financing costs, since these couldn't have been known. And the point anyway is that, regardless whatever the 'average' 25 year figures are, the project cash earnings will be dented in the first ten years or so by the loan repayments (or capex, whichever way you look at it) So the average is of no use for what investors will want to know, which is cash flow in the foreseeable future which I would say is the first five years, with the next five not given much credit for. I was about to rerun my figs assuming all possible costs were in the AISC when I saw the scoping study total free cash flow projection (which one can take to be accurately taking account of everything) of $267.4m over 25 years. That saves the bother because at $1,800/oz the FCF after tax becomes $410.2m or an average of $16.4m pa. But in practice will be substantially less in first ten years while capex and loan repayments are incurred.(not to mention that output won't reach max until year four) So we can take it that Kat's share in he first 5-10 years will be substantially less than $8m ! - most of which will probably beploughed back into the $110m ttal capex (And by the way, the study total output states 661,000 oz over 25 years - ie 26,440 average pa, and not the 35,000 LC states.) All in all, very little info so far for investors to work out the likely share price even when construction starts. If gold stays at current levels, yes at the end of 25 years shareholders will have earned a lot of cash. But will they be around to see it ? And will Kat have spent it meanwhile on Haneti ?
grahamwales: The board of directors also believe that the impending incorporation of the unincorporated Blyvoor JV delivers a clear indication that the requirements set out by potential investors are nearing completion Take as long as you need, gives private investors time to build up a nice holding
grahamwales: I see our negative posters are back on the lse board still claiming to own shares yet tell us that they don’t believe in the company. Not sure if they think investors are so naive that they believe they are invested or trying to brainwash us. Basically what they are saying is that the potential investors in the gold tailings have said we don’t believe there is the amount of gold in the tailings that your telling us therefore go and do some drilling but we’re still not going to give you the money even if you prove up the reserve.
dozyduck: Edgein Kibo's biggest by far financing need is for their coal to power projects. They need multiples óf Kibo's market cap even for Kibo to keep a measurable stake. I've been predicting for over a year that Kibo needs mega-refinancing to survive.Its going a tiny part of the way with med. It will have to do the same (by floating off) with ther rest, but such project's aren't profitable enough (or reliable enough) for investors to accord a high rating to new issues to fund them. It will be the same with Med - now that eg PlusPowergen is withdrawing from the market having achieved results less than 1/4 what they projected in their own IPO. I bet LC (as is his innumerate wont) is still hoping for the returns he quoted when first tied up with Mast. (itself with practically no experience in what is turning out to be a cut-throat UK market.) Investors won't be very interested in it. But old Shylock Sanderson might ! - (at the usual expense to ordinary investors new to LC's levels of judgement)
algernon2: From the FT 5 hours ago: ------------------------------------------------------------------- "Gold raced to a record high on Monday as the US’s deepening Covid-19 crisis sent the US dollar tumbling further and encouraged anxious investors to choose the precious metal as the place to park their cash. The price of the metal, used by investors as a store of value in times of stress, climbed as much as 2.4 per cent in intraday trading on Monday to a record $1,945.16 a troy ounce, blasting past its previous nominal high of $1,921 set in September 2011. Gold has rallied by more than a quarter this year, making it one of the best-performing mainstream assets, as investors brace for the economic fallout of Covid-19 and seek to minimise the effects of sweeping central bank interventions on their portfolios. “I think it is the story of the year in financial markets,” said Peter Grosskopf, chief executive officer at Sprott, a precious metals specialist with $12bn under management. “Gold has finally come on to Main Street as an asset people actually need to have.” Investors have stashed a net $7.4bn of cash into gold-backed exchange traded funds this month, according to data from the World Gold Council — adding to the record $40bn they invested in the first half of the year. “There is no doubt that global demand from investors is currently the major force driving prices up,” said Hans-Günter Ritter, head of trading at Heraeus Precious Metals." -----------------------------------------------------------------
dozyduck: Too high a price being fantasised here. The latest scoping study looks more realistic thsn LC's first (as usual) exaggerated account, and is far less attractive looking 1) The irr is now 25% at a$1,500 gold price against 31% at $1,300. 2) The NPV looks higher, but only because now calculated at 5% discount against 10% - which on paper more than doubles it. 3) In any case NPV's are useless for predicting a share price. It has to be at above 12% (1/3rd that at 5%) to be anywhere reflected in market cap. 4) In this case a NPV over 25 years is even more misleading. Investors will never give credit for more than 10 years ahead, if that. 5) In this case a NPV doesn't recognise that what counts for investors' valuations is cash flow, and that the same NPV doesn't discriminate between early cash flow or late cash flow. In this case cash flow doesn't build up until at least 5 years in 6) NPVs calculated on the 'project' don't allow for what it will be for investors after the large chunk of NPV that repays any project loan. In this case likely to be very large. 7) The ROI is a meaningless number unless told what the 'investment' is. Is it on initial equity before a net (or gross before nterest) profit (geared up by loans) ? Is it on the first chunk of capital investment, before any subsequent investment ? etc etc 8) The ONLY measure a bank of long term investor will look at is the IRR, which is independent of financing and of the NPV discount rate. 9) The total capex now is 3 times what we were told before, but we have no idea when required. 10) Far from LC's initial boast of 35,000 oz/year, the average over 25 yrs is now only 26,400oz/yr Answers to all above are essential before shareholders can know the value to them. That means seeing the full scoping study. On past form LC won't disclose it, but will announce cherry picked figures - out of context and with none of the necessary detail but 'looking impressive' like the "260% ROI" 10) An equity raise is certain at some point, which will make anyone's 'back of envelope' estimates of per share value 'valueless'. One might be necessary to fund Haneti in any case. Sorry Folks ! Only if the eventual detailed feasibility study (which will cost money now) for the tailings (a scoping study isn't claimed to be better than 30% accurate), and funding plan for it and Haneti, is announced should investors venture in (If it happens at all)
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