Woodburne Sq Share Discussion Threads

[marab] 15/1/2012 11:02

engelo - top find that website a lot of interesting stuff and well worth a flick through for anyone invested or thinking of investing here. A couple of bits stood out for me.

'Of the estimated 71 million tonnes of graphite still in the ground around the world, the US Geological Survey estimates that China possesses 55 million tonnes of that. When it comes to actual mine production, China accounts for 800,000 tonnes out of the annual world output of 1.1 million tonnes. The next most significant producer is India, whose mines produce 130,000 tonnes a year, with Brazil in third place (76,000 tonnes) and followed by North Korea (30,000 tonnes).

In terms of reserves, and after China, India has an estimated 5.2 million tonnes, Mexico 3.1 million tonnes and Madagascar 940,000 tonnes. The last mentioned country once had four graphite mines in operation, but at the latest report there was still just one French mine still operating.'

[jojo_jo] 15/1/2012 01:26

Bloody hell, that graphene sub-element of graphite looks like being mega over the next few years. That move by Woodburne looks more brilliant by the day. Thanks for the link engelo. I think I'm in for some more on Monday, this one's not going much further south again... ever.
IMPO.

[jojo_jo] 15/1/2012 01:05

Not likely to be much affected by the broad market fluctuations at the moment impo.
Our various calculations are close enough for now, I think.
Just one point:
Total Value of Assets = GBP1,957,152 in July, and a smidgen more in November, presumably tic the extra £150k cash/Brdy. However the NAV is quoted at 2.7-2.8p/share. Using the July figures, 2.7p x (say) 57m shares gives us an approx. NAV figure of £1.54m, so perhaps (as this is NET asset value) the approx. £400k difference accounts for the loan notes? Using the asset value total, and dividing it by the no. of shares gives us a figure of 3.4p/share, so some debt/liability has been tic when quoting the nav of 2.7p/share.
In this case the loan notes are accounted for already in the various NAV figures quoted by the company. So no wucking furries on that score.
IMPO/DYOR.
Jo.

PS. Nice to see the muppets are noticeably absent from this thread (for now at least!)

[marab] 14/1/2012 20:58

knowsleyman1 - no share holding update since 2010 so you may well be right, I do remember that one of the RNSs was on a fully diluted basis which probably just confuses things more. Either way I should email the company and ask for an updated list of major share holdings and shares in issue.

engelo - DOW up and down like a yoyo, but they usually take any bad European news as an excuse to sell off and we had a plethora of down gradings on Friday. Doubt if it will affect us either way in any case.

[engelo] 14/1/2012 19:16

And now for a bit of excitement try WSAG gets a mention, but the real deal is graphene :-)) Hands up who's heard of it?

[engelo] 14/1/2012 18:57

marab: slump on Monday?? Wall St recovered on Friday and the FTSE future was up 30 last thing. Still, you may of course be right!

[engelo] 14/1/2012 18:53

More important than all this fine tuning imo is Jo-jos estimate of a PE of 1 if we invest remaining bucks at the same price in Graphmada. Even if it's a PE of 2 we can sit back and await the next move, whether RTO or further investment or what.

[engelo] 14/1/2012 18:47

Jojo/marab/Knowsley: a few corrections (mainly for my errors):

The official NAV was 2.7p at the 7th Nov (see 10 Nov RNS).

There is a bit of doubt even about this as the purchase of Brady was sneaked in beforehand (26th October) and we don't know what Brady share price was used, perhaps to bump up the NAV!

I had not found a reliable source for the no of shares in issue (thanks Knowsley for reminding me about the subscription). Working backwards from the 4th Jan RNS, the no of shares in issue at the time the NAV was published was 62.4 m.

So starting pot at 7th Nov is 62.4 m x 2.7p = £1.685 m.

I assumed a slight fall in silver share values by the time they were sold: Jo-jo has assumed there might have been gains. So lets take the 2.7p Nav as a basis.

Investments since Nov 7th have been Graphmedia only at £833k leaving
£852k remaining for investment.

[knowsleyman1] 14/1/2012 17:44

Marab

You appear to have overlooked the, I think, £600K that was additionally raised for further investment. That is what I had more in mind, not that payable to TW.

[marab] 14/1/2012 17:18

In June the NAV was about 2.8p, then we had an RNS in October that said,-

'Faced with these continuing difficulties, and mindful of the need to retain shareholder value in the Company's existing portfolio, the Board has undertaken a strategic review of the sustainability of Woodburne's current investment model. This review has concluded that to provide a long-term, sustainable platform to drive shareholder value, the Company should build its cash resources, via the phased sell-down of its existing portfolio, and thereafter to seek one or more large-scale natural resource investment or acquisition opportunities.

As part of this revised business model, and to initiate the establishment of the Company's cash resources, Woodburne is pleased to announce that it has raised £150,000 before expenses, by way of subscription by new investors, for 4,615,384 new ordinary shares of 0.4p each in the share capital of the Company (the 'Subscription Shares') at a price of 3.25 pence per share (the 'Subscription Price'). The Subscription Price represents a premium of 4% to the closing share price of the Company on 13 October 2011.'

Since we don't know what was sold or at what price we have no clue what the current NAV is. The £150,000 raised at 3.25p will have helped support the NAV though.

Regarding the loan note - 'On this basis the Company will therefore issue loan notes with a 0% coupon which convert at 5.75p into 1,003,148 new shares to TIM in respect of its quarterly management fee.' There appears to be no time limit on the loan note but I wonder if TW would be willing to sell that on at a reduced amount or whether he will hold on to it. We are only talking about £60,000 value so probably doesn't make much difference anyway.

It would appear that there is about 64m shares in issue at the moment which is nothing really for an AIM stock, and we know that at least 22% is held by what we expect to be a firm holder, so probably not a lot of free stock. The share price seems to be pretty well supported at about 3p which is comforting.

So an NAV of somewhere between 2.5 - 3p perhaps, 64m shares in issue, a 22% share holder, some intereesting investments and perhaps the chance of an RTO somewhere in the future. Doesn't look bad value for 3p a share. Be interesting to see if the possible market slump on Monday affects the share price here, although somehow I doubt it. I suspect a few of us here would take advantage of any share price weakness.

I suppose we should thank the Lander brothers and TW for whacking down the overheads here, which means most of any cash raised goes into investments and not directors pay packets.

[engelo] 14/1/2012 17:13

Jo-jo: you've been very busy! I was editing my post (lost it all and redid) while all yours were going through. Will check back.

[jojo_jo] 14/1/2012 14:46

I've done the best I can, with what info I have.
It seems likely they have now sold off all the old silver/gold/etc investments. They should clarify this in the next RNS.
It's the only way they could fund grafmada, unless they've got a bit of time to pay the £833k.
All impo, jo.

[knowsleyman1] 14/1/2012 14:38

I think we will have to wait for the next RNS to, hopefully, find out what the current board have ditched to enable this latest investment.

You will note that the company has no borrowing authority from any recent members meeting, so unless there is some unauthorised borrowing it has all been paid for in cash.

In the not too distant future there is also the question of how the loan notes are going to be repaid, assuming that the share price is still under the 5p conversion price.

Whilst it is all looking very good i would have liked more background information, but then I am an old cynic!

[jojo_jo] 14/1/2012 14:29

Assuming £1m cash (having liquidated all prior investments), and valuing recent stake purchases at fair current value (imo) the NAV value should now be nearer £2.5m.
This is substantialy more than 2.7p/share in only a few weeks!
NAV is probably nearer 3.4p/share now.

Of course a lot more is coming in the form of an rto/jv into the company, imo. Should triple, at the very least from here.

IMPO, Jo.

[jojo_jo] 14/1/2012 14:22

engelo,
Based on the following investment/asset split advised in July, and a virtually unchanged NAV in November and January 2012 (although it looks like it may have risen between Nov and Jan):

Woodburne Square is focused upon investments within high quality silver companies listed on the TSX, AMEX and, together with some special situations in gold and the UK market. Its investments and assets as at 07 July 2011 are split as follows:
Cash GBP11,672
Value of investments quoted on the TSX GBP1,159,465
Value of investments quoted on the AMEX GBP146,475
Value of investments quoted on UK exchanges GBP640,140
Total Value of Assets GBP1,957,152

So they should have had cash equivalent assets (as Silver and Gold investments usually are) in the pot of around £2m.
I guess they must have liquidated this, or some it, to fund the purchase of Graphmada.
If they liquidated all their Silver/Gold etc holdings, they should have roughly £1m left to invest after Grafmada?
They also have Brdy and Grafmada which are worth about £930m at book cost (and a lot more now, in reality).
IMPO/DYOR.
Jo.

[jojo_jo] 14/1/2012 13:58

Yes engelo, no far away from some of my estimates. The effect of the Grafmada investment on overall p/e is imo around 1.5 (less than 1 against actual cash invested , ie. they should recover their £833k well within a year, imo).
I'm not sure what comprised the NAV figure of 2.7p/share, but if it's all cash or cash-equivalents, there's 'effectively' a lot more still available to invest.
Any breakdown on NAV figure?
Cheers
IMPO, Jo.

Calculated rough Asset estimate, see next post.

[engelo] 14/1/2012 13:31

Jo-jo: tried to put a bit more flesh on 584/585. Please feel free to correct!

Assumptions: shares in issue: 57,500, $ exchange rate 1.53

As at 10.11.11, NAV 2.7, market value 1.553m

Allow for 10% shrinkage due to falling mining equities, say 1.4m .

Since then invested in Brady £95k, Graphmada £833,333 .

This leaves ca £567k in equities/cash to invest.

1. Your PE calculations work out if the remaining cash is invested in Graphmada at the same price. Maybe this was your assumption!

2. Looks like further investment in Graphmada/elsewhere will need more funds. Favourite source Bogu: he will be planning all this. Next RNS: completion of strategic review and fund raising?

3. Since we've got £833k to invest right now, we could infer that the silver holdings were sold pdq and so avoided share price falls since Oct. If so a good call, and (particularly with recent changes) we're going to have to learn to respect the new management :-)

[anointedone] 13/1/2012 20:33

I find it amusing that our man Jeff was the contact @ GG & CosMin and I guess
He is putting the armenia gold JV together with "himself & I."

Oh yeah, he has a role with WSAG too which becomes me, myself and I. :)

[jojo_jo] 13/1/2012 15:47

Looking at some old Armenian news I notice that Global Gold are almost persona non grata with Armenian workers, so it looks like they have to have a Russian led company involved to exploit their properties there. Consequently that would put ConsMin firmly in the driving seat negotiation-wise, and they could probably get up to 60% of the JV for $5 - $6m. They'll get at least 50% impo. Clearly a name as famous and respected in Russia/FSU as Bogolyubov will get things together, restore confidence and make things happen.
I guess a lot of Western companies are unpopular in Russia/FSU, which opens up a lot of cheap JV opportunities for popular and (in)famous businessmen like Bogolyubov, Derepaska and Abramovich. No doubt they're all local folk heros, having broken the domination of the 'old enemy' in billionaireville.

All very positive.
Looking good for next week. Major news close impo.
Jo.

[engelo] 13/1/2012 15:18

Totally predictable bad figures from JPM (edit also totally predictable rumours of S&P downgrades) so the whole world is coming to an end again :-(

[engelo] 13/1/2012 15:06

OT (?) I think I'm on my own here but my BRDY holding has gone from despair to hope (20% intra day jump) in about 30 secs flat :-)

[engelo] 13/1/2012 14:56

Jo-jo: We have a PE of 1.5 for part of our asset base (haven't calculated the weight of the BRDY investment or tried to guess the remaining equity holdings/cash components). Rerating logic would apply to the graphite operation only.

You're right though that if an RTO is planned and (as I believe) the parties are
acting in complete concert then this latest transaction doesn't (contrary to what I first thought) cast doubt on the RTO theory. Otoh might well be an indicator of what sort of assets could be injected here :-)

[jojo_jo] 13/1/2012 12:57

Trying to round my holding up into a decent number ahead of the weekend. Graphite's very expensive stuff, and the mine investment looks brilliant, but there's more brewing behind closed doors I suspect.
The investment in a producing graphite operation gives us an almost immediate p/e of 1.5 or less, so the shares should re-rate to reflect a more realistic p/e of (at least) 4 - 5. Ie. they should treble from here. That's without attributing anything to the RTO/JV which I'm certain is still coming to the street, sorry, square.
All IMPO, so DYOR.
Jo.

[marab] 13/1/2012 10:30

Can sell at 2.91p so someone still happy to accumulate. engelo, the graphite investment is looking good, and WSAG are obviously going to increase their share.