Certainly an easy on the eye presentation,as you say nothing new explains things simply without
If RRR can progress the Gold Tailings situation to production at Migori this year cash flow would
improve substantially if the current price of Gold holds.
Ivory Coast Gold exploration looks promising, but long term to production and only small %
Current situation on investments,cash flow and future cash flow certainly a big improvement
set against previous years trading.
Must agree share price too low taking into account future potential of RRR. 2p will be nearer the mark if this year delivers the investment returns(and maybe even a Dividend).
Nothing particularly new, but a nice confirmation of cash in bank and prospects. With JMS and 4 Points, there's a $1m+ per year income stream, plus certainly good news to come form Steelmin and hopefully Congo Copper/Cobalt project. This is just way too cheap now - I'm topping up at this level.
The car and battery industry are panicking and and forward buying any Cobalt that is
Or will become available.If the tailings that RRR are doing a due diligence on with Cobalt
Blue delivers positively it could well be a lucrative investment.
Tin hat on! Defending my friend Andrew Bell is always a way to get the modern equivalent of hate letters in green ink. But here goes anyway, proof that the guy can do smart deals and that those who say everything he does turns to dust are talking rubbish. Let's just look at some facts.
Andrew Bell gets a lot of stick but if you look closer, he actually does some very solid deals from the huge success that is Jupiter Mines (now a dividend producing company) to his latest investment in Steelmin, a ferro-silicon smelter in Bosnia which is now entering production. Red Rock has pulled out a cracker of a deal getting all its investment capital back and a free equity carry of 22% of the issued share capital of Steelmin and didnt have to dilute even one share to get to this result. His financing from RiverFort was a secured bridge with no equity involved which was great for shareholders.
Last year Red Rock Resources (RRR) came across Steelmin in Bosnia, a venture that was looking for the final stage of capital to bring its smelter into production. The opportunity looked to have potentially very attractive operating and financial characteristics once in production.
Previously Red Rock had informed investors that it would minimise issuing equity, as their shares stood at a very large discount to true value, and it expected this discount to be unlocked by the anticipated listing of Jupiter Mines, where it held over 20 million shares.
So the question became whether something could be designed that would meet Red Rocks need to control risk, minimise dilution and would offer an attractive return, and would be acceptable to Steelmin needed to bring their ferrosilicon plant in Jajce, Bosnia, into production.
The project itself looked interesting. A well-built Yugoslav plant, with one 48 MVA furnace installed by Elkem and one 30 MVA furnace installed by Tagliaferri, could be in production from the first furnace with one final push, and would then be capable of 36 million annual revenues and 7 million EBITDA.
In collaboration with Riverfort, Red Rock executed a process of intensive negotiations and due diligence with Steelmin to complete the last dollar finance. On 23rd June and 3 July last year the deal was announced. Red Rock would borrow a $4.4 million Note from a consortium arranged by Riverfort, and would then lend to Steelmin a 3.85 million Loan. The interest rates were aligned in each case at 13%, and the fees were aligned, but though in principle a back to back secured loan that approximately matched terms for both RIverFort investors and Red Rock.
Steelmin believed it might be able to refinance the Loan within a couple of months, but was confident of doing so from a letter of credit once the plant was in production around year end. It was reluctant to give Red Rock the equity it wanted. The compromise was that Red Rock received 16%, and after 1st September would receive another 1% a month until repayment.
In mid-January Steelmin signed up a new longer term lender, which would also provide additional working capital and possibly expansion finance, and on 21 February, less than 8 months after the initial announcement, Red Rock announced that its Loan had been repaid in full and it had repaid the remaining part of the Note.
Red Rock received 4.3 million in repayment, and having itself repaid $1.73 million since September was left with a $3m final payment to make (so a total of $4.73m) and a residue of $2.28m in cash. The back-to-back was profitably unwound, and Red Rock holds now an undiluted 22% interest in Steelmin, which is preparing to start production at the end of the month. To add icing to the cake, since the investment was executed there has been a 20% plus increase in the prices of the main product, ferrosilicon.
Now can someone tell me why that was not a great deal for Bell and Red Rock?
Other than being a nice return for long suffering shareholders, a dividend I think would both boost the company profile and share price. RRR has received nigh on £1.5m in dividends from Jupiter to date, RRR shareholders have received squat diddly.
Cash at Dec17 £125k
Steelmin proceeds £977k + £643k ($912k)
Jupiter Dividend £353k ($501k)
That's £2,098k in the bank presently folks, less any expenditure in the quarter
Plus near term expectations....
El Limon Note £593k ($840k)
El Limon Royalty Q1 £70k ($100k)
Jupiter IPO funds £1000k (A$1842)
So £1,663k due in next 2 months
A dividend of 0.1p/share (10% yield) is easily affordable ~£510k and leaves £3m for commitments to progress existing projects. What say?
I am not surprised that the SP hasn't moved. As I said in my Post on Friday, AB has very little respect in the market. Until money starts coming in from other sources and filling the coffers and he doesn't spend it on other projects, RRR is only valued on Jupiter.
It is frustrating but the only facts Mr Market has to go on is the debacle of El Limon, Melville, plus in RGM there has been several delays regarding Rosa, so the SP stands still until those income streams start generating cash. If past results had been different then the market would have reacted very differently. If Steelmin etc start going with few problems then people will forget and sentiment will return and the SP will start moving north, sadly, until we see anything different why would the Market react any differently?
For the record my average is 10p and I would love the SP to get to those sort of prices and I still think that we can reach that, but it is still a gamble.....
Well, that's a much more concrete statement of why this stock is undervalued. As has been said here many times , the value of the Jupiter stake is pretty much equal to the RRR market cap. I'd be very surprised if there is not a step up today.
Absolutely he can do better than that, and as someone on the BOD of several companies, he should. There was talk of the potential of Melville being massive, and there was all that farce of AB appearing on a video with pictures of Greenland in the background talking of we should think about putting it in, (I can't remember the exact name), some sort of castle and forgetting about it! If prices hit $140/t again then surely it's worth a few quid
I've been in RRR (and RGM) a long time also, and made good money in the past, albeit I'm still in the red overall, even with averaging down at the lowest levels.
To be fair, you can't get everything right every time - not even if you're called Buffet or Jobs - so I have no problem with getting a few wrong and a few right - you'd hope more right than wrong, and as you say Jupiter and Steelmin have been good wins.
But to brush away your failures is not good form for a quoted company. I don't foresee an RNS on it, but I'd expect at least a commentary in the next Annual Report, and if questioned that AB *should* give a decent answer.
I did look through the accounts for Melville Bay and the asset (£5m+) has been totally written off in there. So OK, perhaps it is not economically viable at this point in time. But Iron Ore prices is a volatile thing. Sure it was worth$150/t+ in 2011/12 when Melville was a big thing, and prices dropped to $40/t a few years back, but is in $80/t trend this year. On one hand AB talks about the commodity super-cycle, and there is support for that, sic, but then acts in another way by writing off an expensive asset without a passing comment. It was the flippancy of the remark that enraged me. Mr B, you can do better than that.
AB went from hero to zero in a few months due to several things, a number of years ago, and Greenland was one of them talk of selling and it was all about done and then the buyer disappeared, along with the money. Then there is El Limon and that fiasco. Kenya hasn't been plain sailing too. Jupiter has been the saving grace and, putting it plainly, saved RRR from going under. You're right a comment like "Dead" without any narrative is very poor, but AB hasn't been that great in the past. I assume he's waiting for Jupiter to complete its float or buy out or whatever to complete and then we'll get some news, he did hint that something was happening soon. Initially, we got quite a few newsletters, but they dried up over the years, not had one for a year, I think. Cut backs, AB would say...Nothing worth saying I'd say....
Obviously with Steelmin and Jupiter there certainly has been a corner turned and the resurgence of AB could well happen. I said many years ago he spread himself too thin and gambled too much and lost, but thank heavens for JMS. Hopefully the lessons have been learned and we get true shareholder value. He sort of hinted at a divi come June, but I'm not holding my breath. I wouldn't be surprised if the surplus cash get's reinvested into another project. Perhaps if Kenya gets going they'll need cash for that. If it does it should up the SP.
Confident that we should see some upward pressure on the SP in 2018, how much, is anyone's guess. But the only true winner in all of this is AB and the BOD!
Umm. The point from the Zak Mir interview about Melville Bugt being dead is interesting - not in a good way. That looks like $0.5m investment down the swanny. That was one of the big projects once, DSO from Greenland.
In the Nov17 report, RRR held 60% of Melville Bay Ltd. AB remains a director of Melville Bay Ltd and it is still an active company. So what has happened - a disposal, licence being allowed to lapse, Greenland government intervention?? There have been no RNS about this, AFAICS, but I feel an explanation is in order. You can't just say something is dead with providing some narrative?
Whilst I'm positive on RRR, things like this are very frustrating and undermine the integrity of the company.
The indicative Timetable for the Buy-Back Offer is as follows:
Booklet lodged with ASIC Wednesday, 24 January 2018
Record Date of Buy-Back Offer 2.00pm WST on Wednesday, 24 January 2018
Booklet dispatched to Shareholders Monday, 29 January 2018
Opening Date 9.00am WST on Monday, 29 January 2018
Closing Date 2.00pm WST on Monday, 19 February 2018
Acceptances processed Friday, 16 March 2018
Cancellation of Shares Monday, 19 March 2018
Dispatch of confirmation letters Monday, 19 March 2018
Dispatch of payment to Buy-Back participants Monday, 19 March 2018
The above timetable is indicative only and subject to change by the Directors of Jupiter.
With the profit from Steelmin, which had no comment here, that should put a nice sum in the bank.
Para Resources certainly making a success of the El Limon Gold Mine. Ramping up Gold
Production from the January figure of 457 oz to 1200 oz by the month of June.
They are also saying the gold vein extends for 12 miles through the El Limon Property with a
potential of 2 to 3 million ounces mineable.
That would certainly greatly increase RRRs bank balance on the Royalty Payments.
Good spot sixoclockticket.
Thats the results you get when competent experts run the patch.
manganese up 10% ish in the last year. that equates to $15mill to bottom line so profit for the year should be around $80mill thats worth about $1 mill to RRR. the listing should be interesting I reckon the mine will be worth listing at somewhere around 10 times next years earnings so around $400 mill or $5 mill to RRR so those who got locked into RRR back in 2012 when share price was equivalent with dilution to 33p may see some pain relieved but lets be serious. AB has made a proper mess of running this company
Its good to see that the shares in RRR have taken a turn for the good for its Shareholders.
The current investments are certainly showing value for money, and hopefully the BOD
under Andrew Bell will continue this trend.
Shoats Creek appears to be the weak link in the chain.
Maybe should be given the order of the boot.
Yes that is why i stay investeren here
But my confidence is shaky to say the least after the due diligence disasters
Yes disasters (4times) with regency minder
Never a word to explain of excuses and of h.k.
Hehe dat lucht op
I agree with you that it is undervalued. Market Cap here is less than £2m, yet £.5 million a year coming in then surely that gives a NPV of £3million if you have a discount of 10% and lasting 10 years, add up all the other assets etc then we should be worth 10million that's 5 times today's SP that's why I said 2-3p, so undervalued yes.
Will we get there? It really does depend on the steel project, if no real issues then we could see 3p and then we might even, dare I say it, a small dividend. I'd expect if Kenya pans out then he'll farm that off and get a royalty.
Yes fish lips, I nearly included that in the post. He has collected quite a number of errors hasn't he. Worse he has usually bulled them up rather than being balanced and is much more reluctant to admit things in the garden are less than rosy than he should be. I nearly said, much like has recently happened at Ortac, a new broom is required to move this on but as that is unlikely to happen it seemed pointless but you are correct and lets hope AB does have a little more success with his risk taking!
The trouble is sentiment. After the debacle of Columbia, Greenland and late news on other items, the market has very little confidence in AB. He does deals and some work and some don't he has a very big risk appetite and as long as he can raise funds and some of the projects make money he'll always do it. He gets paid and we don't see much of a return on the SP. Hopefully the deals will be less risky and the money will come in, as predicted from other projects and we will certainly see a rerating. It should be at least 2-3p for JMS, though.
With a fairly regular £500,000 per annum from Jupiter with the prospect of further increases if they go for growth and presumably, though we haven't heard anything for a while a dribble from Columbia and the steel processing plant coming on stream early 2018 am I the only one who thinks this is looking seriously undervalued?
UK Investor Show 2017
Red Rock has Investments in a Producing Manganese Asset in South Africa and a Ferrosilicon Smelter in Bosnia
The Company has exposure to gold production in Colombia as well as gold exploration in Kenya, Ivory Coast and Ghana.
Oil and Gas
Red Rock has producing oil and gas investments in the United States and interests in petroleum exploration onshore in Benin.
Through its investments Red Rock offers exposure to a wide variety of commodities including metallurgical coal, nickel and nickel processing technology, as well as coal bed methane.
El Limon bullet points.
RRR: Ongoing Disposal
Gold Assets sold in 2015 for $5M
USD1M Promissory Note ($250,000 paid $750,000 due 1st April 18)
USD3M Royalty Still to be Paid
2017 Production Expected to be
Long Term Goal of 25,000oz per Year
Jupiter Mines bullet points.
Manganese production in South Africa
Production of 2MT
Targeting 3MT in FY2018
Announced distribution of USD55M to shareholders
RRR HOLDS 27.3M Shares
Funds from JMS buy back $530,000 received + $300,000 due November
Stake in JMS could be worth £5m+++ as they hold a 49.9% stake in Tshipi Manganese mine in S.A. which is in the process of realising shareholder value, also JMS are considering re-listing on the ASX ( RRR hold 27.3m shares in JMS 1.2% )
Planned distribution of US$55m to shareholders in Q1 2017
Tshipi, South Africa 49.9% ownership of open-pit manganese mine
Started production early 2013
Production increased to 2MT+
One of the worlds largest Mn mines
Strong manganese prices
Mount Mason, Western Australia DSO project
On care and maintenance
Mt Ida, Western Australia Magnetite project
JORC inferred resource of 1.85bn tonnes at 29.48% Fe
On care and maintenance
Steelmin (Ferrosilicon Smelter in Bosnia) owes RRR EUR3,874,560 8 Month secured loan note, check out details below. (an income is expected from this investment in 2018 )
So far RRR has 18% of Steelmin, (UP TO OCT) and this will increase each month @ around 1% per month until the loan is re-paid to RRR. (up to max 30% ) Steelmin are expected to go into production this December and re-finance which should enable them to then clear the loan to RRR EARLY who in turn can then repay their lenders (RRR AT PRESENT HOLD 18% OF STEELMIN for VERY little money) it is assumed RRR have so far made two repayments on the loan, which is secured on JMS stock.
Steelmin Ltd. Bullet points.
RRR 16% Stake - May Increase Up to 30%
Initial FeSi Production Targeted for Q1 2018
Two Electric Arc Furnaces Onsite
Complex Capacity of 48,720t of FeSi and 9,700t of Microsillica
Projects 35m Rev and 7m EBITDA
Near-Term Production in Familiar Steel Feed Space
VERY CLOSE TO PRODUCTION
Migori Gold Project bullet points.
RRR: 75% Project Interest
1.2Moz gold JORC Resource
Kenyan Greenstone Belt
Working with Kenyan Ministry of Mining on Licensing Issues
Exploring Partnership Opportunities
Ivory Coast Gold Project bullet points
Early Stage Gold Exploration
Underexplored With Significant Potenital
Birimian Greenstone Belt
On the back
Might dip my toe here despite the somewhat unpromising Steelmin deal.
I emailed the company and they confirmed that the board position relating to the steelmin deal is unpaid. They also confirmed that a substantial liquidity event from the Jupiter sale would likely lead to a distribution subject to board approval.
In my email I mentioned that, in my eyes, if the return to shareholders wasn't substantial, that would effectively amount to a resignation by AB as his position would be untenable. Not sure what everyone else thinks?
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