Serabi Gold Share Discussion Threads

[imastu pidgitaswell] 06/4/2021 08:56

Thing is I have to sell some of either FRES or POLY to buy. Only a few mind, but even so - those are way too cheap and rising.

All in the timing...

[borisjohnsonshair] 06/4/2021 08:53

Missed chance under 62p pal, be quick under 63p. All the best.

[plat hunter] 06/4/2021 08:51

See my post from the 2nd... "Best case scenario... They put it down to fraud, someone gets sacked, the auditors then sign off with massive questions over Risk management."Let's hope that saves the tsx listing

[borisjohnsonshair] 06/4/2021 08:51

Storm in a teacup - the future unchanged and production marches on.

[imastu pidgitaswell] 06/4/2021 08:44

So there were some local controls - each withdrawal required two people to authorise... 🙄

They've pinched it - as I said, it's Brazil. It's less than £60k.

10.30 looking like a good call. Might set my buy for 10.25 to get in just before the rise...

[tightfist] 06/4/2021 08:35

That early 504,600 trade shows there is some serious money about.....

[borisjohnsonshair] 06/4/2021 08:27

10:30 will be the lowest opportunity to buy in ever again

[trader536] 06/4/2021 08:21

Timber!

MH has made SRB shareholders the biggest April fools this year 🤣😂😆

[plat hunter] 06/4/2021 08:10

So long as you're right, that's all that matters.;-P

[trader536] 06/4/2021 07:17

Boris my dear friend you were warned about the Brazil risk with this dog a long time ago, woof woof 🐶🐕

Another 9 years holding losses for my good friend stupid 😂🤣😆

Greedy fingers are in the till 20p coming soon

[backinblack80] 06/4/2021 00:00

You're truly wonderful mate. ATB

[backinblack80] 05/4/2021 22:38

Thanks Plat, we all think you're a good guy...honest.

[plat hunter] 05/4/2021 09:54

Some brave posting imo...Good luck for tomorrow everyone.Buying or selling, I hope you get what you want.

[tightfist] 04/4/2021 15:47

Not sure I will wait until 10:30......

[ironstorm] 03/4/2021 20:50

The issue isn’t the assets or the cash. The issue is the management and execution. Woefully lacking.

With better management this could fly. With MH it’s one thing after another. With MH in charge we are basing expectations on a lot of luck.

MH must go.

[tiger60] 03/4/2021 17:58

Have a strong recollection that although closing cash at end of Dec was reported as $8.1 this included cash receipt from early January (let me find the official wording). I think cash was 6.6m at end of Dec.

‘Cash totalled US$8.1 million at the end of December 2020 (including the initial outstanding proceeds from a December gold sale of US$1.5 million’

Again should be reporting the correct amount. The balance sheet as at 31 Dec by definition should reflect the balance as of that date and in no way should reflect expected payments.

But your comments above are valid but credibility was always an issue and one that has been brought to the fore once more. Matching forward statements to actual events has been a thankless task. Coringa is two years away and it looks like more than words/trust is needed to get a rerate. For long term holders a blip hopefully, for leveraged or short term holders another disappointment.

I was a short term investor hoping to ride the gold run but now a long term one awaiting what should be a turnaround in the months and years to come. However, I don’t think MH or CL should be able to ride this out but they will.

[plat hunter] 03/4/2021 16:21

Stu...There's nothing prudent in late reporting and getting suspended from exchanges.No listing no liquidity... Not that there's much anyway. Number one reason why i binned them at 86p for a 10p loss.This is one of those odd ones, in where on the surface it's a good company but the market is so small that members here can play the MM themselves. Put it this way, I'll be surprised if this gaps up on Tuesday.

[bomber13] 03/4/2021 16:19

Thursday's after hours announcement ahead of the long Easter weekend , strangely entitled " Miscellaneous " , has undoubtedly made Serabi's ambition of being valued in line with its peer group a whole lot harder . Having to cease trading in Canada temporarily , the one country which is the benchmark for valuing mining stocks , and owning up to some internal accounting and operational discrepancies , albeit not life threatening , will leave a nasty taste in investor's mouths , particularly those who took part in the US$17.5m fundraising at 75p just 4 weeks ago . COVID or no COVID , poor internal controls have been exposed even if travel restrictions in the last 12 months have not allowed the CEO and FD easy access to kick the tyres .


So where can we find some positivity in this unfortunate cameo ? Undoubtedly , it is in the cash and the assets .


Whilst we don't yet know the financial results for Q4 2020 and Q1 2021 , we do know that cash was US$11m at end September , 2020 , US$8.1m at end December , 2020 , and US$20.5m at end March , 2021 . We have already been warned to expect a poor Q4 as a result of lower levels of gold being sold due to timing fluctuations , so , on the basis of the quarterly movement in cash , it looks like net operational cash flow will be about NIL in Q4 after allowing for the US$3m ( US$1m per month ) paid to Equinox as part of the Coringa acquisition agreement .


For Q1 2021 the cash situation is confused by the US$17.5m ( gross ) fundraising , and one has to reverse engineer the US$20.5m cash at end March by making various subjective assumptions in order to guess the net operational cash flow for Q1 , so here are my guesstimates below for what it is worth -



Starting cash Dec 2020 - US$8.1m

Plus gross fundraising - US$17.5m

Minus cost of fundraising - US$1m (?)

Minus Greenstone Convertible - US$2.5m

Minus Equinox payments - US$3m

Minus Exploration - US$1m ( ? of the US$5m budgeted for in the fundraising )

Minus Coringa Mine Portal - US$0.4m ( ? of the US$3.4m budgeted for in the fundraising )

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US$17.7m

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Subtracting the above US$17.7m from the closing March cash of US$20.5m therefore gives an expectation of around US$2.8m of net post tax operational cash flow in Q1 2021 , an okay quarter and not too dissimilar to figures for Q2 and Q3 2020 .


Looking further forward , we know that Serabi is looking to retire the remaining US$3.6m of Equinox debt shortly to leave the company completely free of debt , and we also know from the budgets in the fundraising document what may be left to spend on exploration ( US$4m ? ) and Coringa's mine portal ( US$3m ? ) . These 3 items add up to US$10.6m , so on that basis pro-forma net cash going forward , before one makes any cash flow assumptions for the rest of 2021 , would still be a healthy US$9.9m .


Coringa's cost to build when fully permitted has been put at US$24.7m , which includes a 20% contingency , so subtracting the US$3.4m already budgeted to be spent on its mine portal and initial development this year ( as per above ) , whilst awaiting the full construction permit , gives Serabi US$21.3m still to find , and this will be funded by cash flow , the pro-forma net cash of US$9.9m , and some form of short term project finance . Coringa has the potential to be an absolute nugget for Serabi . Bought for US$22m in late 2017 inclusive of a larger than required processing plant and when gold prices were US$1250 per oz , the PEA in September , 2019 projected a conservative post tax NPV10 of US$56m at a gold price of US$1450 , and an IRR of 46% . AISC costs are projected to be US$852 per oz on production of 38/- oz pa for a minimum of 9 years , so the margins should be mouth-watering .


Adding Coringa into the mix of the more established Palito and Sao Chico mines gives Serabi the potential to be a near 100/- oz pa gold producer by 2023 with AISC of just under US$1000 per oz . Meanwhile , its exploration drilling campaign on some new and highly prospective tenements has the potential to take overall resources nearer to the 3m oz that Serabi is targetting .


Rightly so , the knives may well be out on Tuesday morning , and emotions may get the better of the fundamentals in the short run , but , providing there are no more skeletons in Serabi's cupboard and corrective actions are taken , opportunity knocks . Ultimately , the cash and the assets more than back the shareprice . At 60p , 10% down from Thursday ( for arguments sake ) , the market cap would be US$63m , and the EV just US$42.5m .