Shaft Sink Share Discussion Threads

[ivyhuang] 06/2/2014 21:13

I am the share holder of SHFT.

Found the following second article in:


January 28, 2014 7:21 am
ENRC founders' venture alleges court order caused 'losses'
By Cynthia O'Murchu
.......

Separate arbitration proceedings are under way in Switzerland between EuroChem and Shaft Sinkers. In that case, EuroChem claims damages of $800m, alleging that Shaft Sinkers hid a report which EuroChem argues says that the excavation of the mine shaft could not be completed using the technique Shaft Sinkers proposed. EuroChem also claims Shaft Sinkers paid bribes to an employee of EuroChem to cover up problems encountered during the excavation work at Eurochem's Gremyachinskoe potash mining project in Russia.

...

The Swiss arbitration proceedings are secret, but defence arguments made on behalf of IMR in the Dutch case stated that EuroChem had misinterpreted the findings of the report into Shaft Sinkers' proposed excavation methods and that the EuroChem employee to whom bribes were allegedly paid had a consultancy agreement with Shaft Sinkers which he had cleared with his employers.

Both Shaft Sinkers and IMR deny any wrongdoing. A spokesperson for Shaft Sinkers said: "Shaft Sinkers completely rejects EuroChem's unfounded allegations."

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[hedgehog 100] 31/1/2014 12:05

31/01/2014 10:52 UKREG Shaft Sinkers Holdings Plc Impact of AMCU Strike

"Impact of AMCU Strike

Shaft Sinkers Holdings plc (LSE:SHFT), the international shaft sinking and underground construction group, provides an update on the ongoing strike action by members of The Association of Mineworkers and Construction Union ("AMCU") involving its clients, Impala Platinum Holdings Ltd. and Lonmin Plc., and the impact it has on Shaft Sinkers' operations at those sites.

Whilst Shaft Sinkers' employees are not on strike, a number of its projects for these clients have been impacted by the current strike action at these sites, although the situation at each site remains fluid. The remainder of the Group's South African projects are unaffected.

The Board believes that the strike could result in a material negative impact on the Group's revenues and profits for the year ended 31 December 2014 if the strike situation prevails for an extended period. The Group continues to monitor the labour situation in South Africa closely and will make further announcements as and when appropriate."

[technofiend] 31/1/2014 12:01

SHFT's share price has normally recovered quickly from the imapact of strikes.

[mrwhits1] 31/1/2014 11:22

due to negative impact in strike action, if it continues...

[technofiend] 31/1/2014 11:20

Let me guess, decline in value of South African Rand expected to impact revenues?

[technofiend] 31/1/2014 11:18

27% fall?

Anyone know what news is coming out?

Bad results expected?

[buywell2] 26/1/2014 23:28

PLAT Mining stikes resume in South Africa then

[muckshifter] 24/1/2014 13:19

Noirua,
You would think that getting paid in $US and paying your staff in Rands would be very beneficial, but I don't think that's the case on many SA contracts somehow, judging from the last half yearly report. I couldn't understand how the fall in the Rand against the £ over the period could explain the decrease in turnover that shft blamed on that exchange movement, even if every job in SA was paid in Rand.

I suspect that the current strikes at most of their SA contracts is weighing on the shares at the moment. But there has been no announcement from shft so maybe they are still working. I once worked a contract, in the middle of a huge works, right through a major national strike which had shut down our client, and although it was uncomfortable for our local lads, and we had union men watching us through binoculars and trying to intimidate everyone, we managed OK. So you never know.
Regards.

[noirua] 24/1/2014 10:32

Contagion Spreads in Emerging Markets as Crises Grow - Bloomberg


I know SHFT have negotiated and renegotiated some South African contracts to US$s and it looks all the more urgent now.

[547trader] 21/1/2014 23:27

Thanks Hedgehog, I think I have enough information now. My own research and your helpful pointers and views have led me to err on the side of the bulls for SHFT.

[hedgehog 100] 15/1/2014 21:18

A useful extract from SHFT's prospectus dated 20th. December 2010:

"Under no circumstances does the Group accept liability for consequential loss and damage. In circumstances of force majeure, each party generally is responsible for its own costs."

[hedgehog 100] 15/1/2014 21:08

547trader,

I first became aware that EuroChem's claim was not against the group as a whole when I attended SHFT's AGM last June. Please see my following post on the thread "SHAFT SINKERS The thread for debate not bile. (SHFT)":

Hedgehog 100 15 Jun'13 - 20:34 - 44 of 266
"HEDGEHOG 100'S 2013 SHFT AGM (7.6.13) REPORT
..."

[547trader] 15/1/2014 20:37

Thank you for redirecting me to that information. Very useful. I was under the impression that if the arbitration claim went against SHFT it would be a case of insolvency for the entire group. It seems your view is that this is not the case at all, but in fact the claim is against a subsidiary of SHFT which will leave the group to continue its other operations.

Where did you get this information from?

Thanks again.

[hedgehog 100] 15/1/2014 16:35

To be honest 547trader, I think that the fact of the claim is now very 'old news', having been announced over fifteen months ago.

Any shareholders, including institutional ones, who would wish to sell before the outcome have had plenty of time now to sell out, and I believe should now have done so.

Equally though, the likelihood is that the shares will not really start motoring until the claim is out of the way.

But I personally, as a SHFT shareholder, am supremely relaxed about the claim.

Please refer to my following posts on this thread for more details:

Hedgehog 100 7 Oct'13 - 21:51 - 4 of 59
Hedgehog 100 8 Oct'13 - 17:56 - 6 of 59
Hedgehog 100 12 Oct'13 - 19:32 - 9 of 59
Hedgehog 100 12 Oct'13 - 20:05 - 10 of 59
Hedgehog 100 13 Oct'13 - 15:27 - 13 of 59

[547trader] 14/1/2014 22:52

Hedgehog, profit forecasts sound wonderful, but do you not feel concerned about the arbitration claim result?

I know SHFT "is contesting these claims robustly" etc as they are "without merit" but have you read this?



Its a little old but it appears SHFT have a bad apple, could it not bring down the whole tree?

This part is most worrisome:

"EuroChem in October last year initiated arbitration proceedings against Shaft Sinkers, claiming damages of $800m, alleging Shaft Sinkers concealed a report that was critical about its mining methods and bribed a EuroChem employee to cover up difficulties encountered during the performance of Shaft Sinkers' work at EuroChem's Gremiachinskoye project in Russia"

[hedgehog 100] 14/1/2014 18:44

2013 eps of say 7.5p would be a 53.7% increase of the 2012 eps of 4.88p, which would highlight the strong earnings recovery here.

And another 50% increase could follow, with 11.84p forecast for the current year.


Assuming a relatively conservative result of 7.5p eps for 2013, at the current share price of 2013 that would equate to a P/E of 2.467.

And the PEG ratio would be a staggeringly low 0.046!




Is there another main-listed share with a PEG ratio as low as this?

[hedgehog 100] 14/1/2014 16:32

From the "SHFT (SHFT)" thread:
muckshifter 30 Dec'13 - 15:40 - 2361 of 2363 0 0
" ... The way I see it, a heavy defeat for shft would most probably be curtains for them within a few months, despite all the HH assurances that they would just bankrupt the subsidiary and carry on, with no ill effects. At the time Eurochem let the contract to shft, the company to which the award was made was, iirc, the main asset holder of shft, and this was changed at IPO, but I doubt if that change in status, post contract, would stand legal challenge. ... "


Muckshifter,

While I'm in questioning mode, where is your evidence for your above piece?

The EuroChem contract was awarded to Shaft Sinkers in 2008, and SHFT's 2010 prospectus said this:
"July 2008 EuroChem awards the Group a major contract at Volgakaly in Russia"

However, that's different from saying that the contract was actually signed with the holding company, rather than with a subsidiary company.

It seems far more likely that the EuroChem contract was signed with a Shaft Sinkers subsidiary from the start, and that no 'switch' took place.

Do you have any evidence to the contrary? As opposed to what you supposedly 'recall' from years ago, with no source quoted. Because I can't see any such evidence in the prospectus.

[hedgehog 100] 14/1/2014 15:44

I have read them, and I've been unable to see any such evidence in them - could you please be specific?

[muckshifter] 14/1/2014 15:34

Plenty.
Read my past posts and you'll see.