Ormonde Mining Share Discussion Threads

[gotabsirius] 20/6/2019 08:26

Wait for turn in Tungsten imho. Chinese will ensure it goes much higher

[jamie crawford] 20/6/2019 08:18

Things would want to improve before the next AGM I think they will get a grilling from the shareholders as to there this company is going I always believed they were heading in the direction but now I don't know what's going to happen.cut my losses before they get worse or hold on I'd like to hear from others on how they position themselves now after yesterday

[dolores123] 20/6/2019 08:13

Its oversold now. When tungsten price improves so will share price

[cyberbub] 20/6/2019 07:50

Thanks steel - another reason behind the drop possibly... What's going on with the APT price??

[steelwatch] 20/6/2019 07:45

Europe - APT, cif Rotterdam - Ferro-tungsten, in-warehouse Rotterdam Wednesday June 19 APT- $230-245 per mtu - Offers at $235 per mtu



(Early indication ahead of usual Monday update)

[cyberbub] 19/6/2019 20:33

I think a buyer will probably want to wait until they see proper cashflow established (ie. in say 9-12 months) before striking? I suppose they would have to pay more in that scenario though...

[cyberbub] 19/6/2019 20:28

Are we able to work out a reasonable share price for ORM in a takeout situation? I suppose the key variable is the APT price. If APT was say $300 can we calculate a takeout price for ORM? We'd need the NPV for the project and to build in the debt level etc

[gotabsirius] 19/6/2019 20:18

Current trade disputes with China will only heighten the likelihood of this project being taken out by a larger beast. The west will want to significantly reduce reliance on China for metals such as Tungsten where they have a strangle hold over supply. Additionally, the way the company communicates with the market suggests they aren't too concerned on share price fluctuations.... Why?

[gotabsirius] 19/6/2019 20:13

My guess is the project will be bought out before year end. Wouldn't be the first time a company has tried to buy this project, indeed orm were offered over 4p cash pre Oaktree funding

[cyberbub] 19/6/2019 19:45

Thanks Sirius, that resolves my question.Hopefully Mr Market is wrong footed then? Would be nice to see a bounce!It's still clear that ORM's cash balance is perilously low, though... Let's hope they can get through the next 6-9 months until revenues start flowing...

[wanobi] 19/6/2019 18:07

many thanx gotabsirius and thanx for posting this, cheers Wan :-)

[gotabsirius] 19/6/2019 18:00

Spoke with company this morning and pleased to report Saloro project’s funding headroom is sufficient, based on current forecasts.


Ormonde receives revenue under a management services agreement in place with the Barruecopardo Group. 2018 saw higher overall “administration costs” reported due to once off, non-repeating expenditure, including legal costs associated with a water discharge at La Zarza. It is not anticipated that cost will recur in 2019. Aministration costs are managed in line with revenue and this continues to be our strategy.

So no dilution and no more funding required barring a crash in APT

Thanks

[cyberbub] 19/6/2019 17:31

Good find Dolores. I've also realised that the accounts are in Euros - doh! That's what comes from reading stuff on a small mobile screen...So the question of the Euro 750k is cleared up. What's still not clear is why the admin expenses have jumped 30% and whether this will continue.

[dolores123] 19/6/2019 17:23

PS I was quoting from rns dated 22/12/16.

[cyberbub] 19/6/2019 17:19

Yes. We need clarity on why they have increased - I doubt they will respond to me but I believe a couple of longer term holders on this BB have the ear of the directors? Or wait for the AGM I suppose but it would be nice to find out now - and particularly whether they're expected to increase further.

[dolores123] 19/6/2019 17:19

Just found this extract re the 750.

"- The Project JV partners have also agreed to defer an equal portion of their respective management and monitoring Fees. As a result the annual management fee payable to Ormonde will reduce from EUR1 million to EUR750k with reinstatement of the full fee and the accrued amounts being made upon the Project achieving two consecutive quarters of positive cash flow. "

[dolores123] 19/6/2019 16:43

Ok. So the problem appears to be larger than expected admin etc expenses.

[cyberbub] 19/6/2019 16:39

That's not correct as the figure shown for 2017 in today's accounts is £750k as well.

[dolores123] 19/6/2019 16:26

I recall the first year was reduced to 750k being a part year.

[sleveen] 19/6/2019 16:12

cyber,

You're correct in your analysis re needing a small placing. That's how I read it too.

Perhaps nearer to £400k than £250k.

[cyberbub] 19/6/2019 15:46

I've looked back at the details of the Oaktree agreement. ORM are to be paid EUR 1m p.a. as a "management fee", which was expected to "cover all operational expenses". So I don't know why it's shown as GBP 750k? It should be closer to GBP 850k. Plus it would seem that ORM's expenses have risen over £1m so this fee is no longer covering them.Does anyone on here have the company's ear and can ask them why?

[dolores123] 19/6/2019 15:20

Wont they be due another payment from saloro or oaktree eg annually?

[cyberbub] 19/6/2019 13:10

We already knew that initial grades were low, but they will be working into the higher grades in the coming months. The plant itself seems to be working well and there seems little obvious reason to worry on this front.The results themselves show that most of the loss is non-cash which is good. However I think the main issue behind today's drop is the actual cash level.As at Dec 2018 (it's poor that it has taken 6 months to issue these simple accounts) the company had only £400k in cash, with a net £200k trade payables, so only £200k in net cash.Their admin expenses have risen to £1m (why are costs so high for a small company with no direct outgoings?) but these are offset by £750k 'revenue' which I believe must be the money which Saloro pay them as part of the deal.So they are burning about £250k net p.a. and had £200k left 6 months ago. I think Mr Market is calculating that they will still need to raise equity to see them through to cashflow from the mine. This seems a real possibility to me, which is disappointing as it wouldn't be necessary if their admin expenses had not increased to £1m. On the positive side, assuming that cashflow starts rolling in this side of Xmas, I don't imagine they will need to raise much more than another £250k, which is a fairly trivial 2% dilution even at say 2.5p.I see the drop today as an opportunity, for people willing to hold 12 months....No advice intended etc

[wanobi] 19/6/2019 12:50

adding more today, some showing as sells on the ORM ADVFN trades page :-), now's the time :-) cheers Wan