288 replies to this topic

[soutie]

I have now had a reasonable dig through the results & yeah...all is not bad....they are however heavily dependent on Eskom which given their reserve mix is understandable. While I may not be altogether comfortable with that it makes no sense to be a shareholder in a company whose stated direction is to be 50% + 1 black controlled & not be aiming in this direction so while I would have liked to see Mr Boje at the helm until that was achieved I will be satisfied with some new blood appointed to the board with minority interests paramount.

One of the overwhelming characteristics of small caps is we're always waiting for the game changer move that will push the share price into orbit, Elandspruit was such a chance but has been way overshadowed by all the other sh%t that has taken up considerable executive management time which is evident in their debtors book...! Listening to the results presentation if Mr Suliman were to remove Mr Ramite's penis from wherever it's firmly lodged I'm sure he would be much more comfortable let alone speak much clearer....

Happy to hold till next results or even better Eskom deal.

Cheers.

[Crunch]

@keithmclachlan: Actually quite good results from Wescoal out this morning.. Comfortable balance sheet & cash generation. Trading margins up, but Eskom key.

Hi Sugafoot

 

I'm not impressed with the results as they highlight some concerning issues.   However in the longer term there may yet prove to be some value in Wescoal for  shareholders.   Personally I have reduced the number of shares I own in Wescoal as I no longer believe that this company is necessarily acting in shareholders best interests and as a result I limit risk by reducing my average cost.  The balance sheet is indeed comfortable, but not as comfortable as either last year or as I had anticipated.   Trading margins are slightly up due mainly to increased stripping ratios at a mine with a limited allthough increased life span.   Turnover is also up however its pointless having an increased turnover if your customers can't pay however it is a fact that there have been some "once - off" expences incurred.   In esscence Wescoal is highly dependent on future long term coal contracts with Escom. To this extent Mr Sulaiman has been brought onboard and has  begun a process of ensuring that Wescoal is majority black-controlled.
 

[Sugafoot]

@keithmclachlan: Actually quite good results from Wescoal out this morning.. Comfortable balance sheet & cash generation. Trading margins up, but Eskom key.

[Crunch]

Hi Soutie

 

Thanks for you input.  

 

You have mentioned that Mr Raminites objective was to "make sure he gained control of or blocked the sale of the company"

 

I'm not sure of Mr Raminites  intent, however i'd like to share the following facts.   When I last spoke with Mr Raminite on 12.05.2015

he intimated to me that the bid was not genuine.   This may or may not be the case.... Brendon Hubbard has intimated that

he feels Mr Raminite has not acted in the best interests of shareholders which may or may not be the case.   I can therefore

logicially assume that this is why there is a request for two non-executive directors to be appointed as he believes that there may be other interested parties and thinks that there’s more value in attracting a bid than in Ramaite securing the Eskom contract through his BEE holding.  Mr Boje was going to leave Wescoal anyway in the near future and I believe that there was a myriad of reasons for his resignation ranging from personal to circumstantial.   The "sale of the company" was terminated on 24.02.2015 and Mr Raminite has purchased 2,520,711 shares at an average cost of R1.95 since the termination of the bid .... up until the commencement of the "closed period" which began on the 31st March. He has mentioned to me that he intends to continue purchasing further shares in due course- which may or may not be the case (when discuss prospectively it's almost tantarmount to speculation)

It makes sense for Wescoal minorities to win some assurance its board is working for all shareholders however i'm not understanding a couple of things.   Firstly what is Mr Raminites true intent?   Secondly why buy just under 5 million rands worth of shares at an average price of R1.95 after the bid was terminated assuming that he knew that the rehabilition liability would lead to results which would most likely be below expectations, which in turn would have a negative effect on the share price.........   There are of course answers to these questions and I believe the situation that we are aware of may only be the tip of the iceberg.  

 

 

[soutie]

Hi....

 

I'm new to this forum and have been an investor in WSL for a while.  I'm not impressed with the trading statement which historicially

seems to have been issued the friday before the results.   I'm not convinced that the Wescoal directors only now realise that the results for the period to be reported on will differ by more than 20% from the previous corresponding period.   It is clear to me that a trading statement of this nature is likely to concern shareholders as can be seen by the current decline in the share price.... which I would think could also have been anticipated.   From a technicial perspective this leaves us with support at approx R1.12.   From a practical perspective this will afford Mr Ramaite an opportunity to continue to build his position within this company at a considerable discount to what I would consider to be fair value. Ultimately once Wescoal have a signed agreement from  Escom, there will be more certainty with regard future earnings.   In terms of earnings -  the rehabilitation liability has cost approximately 6c per share which equates to the lions share of earnings over the last six months.... I must question why shareholders were not notified of this impending liability timeously.   It will be interesting to see how much the settlement of mediated exit packages have cost shareholders.   Significant increases in doubtful debt are concerning.... It's all about managing the three "what's"   WHAT 1 ..... what youv'e planned to happen   WHAT 2 ....what didn't happen   WHAT 3 ..... what the hell you're going to do about the disparity between the two ............ management, pure and simple is about reducing the disparity between the current outcome and the desired result.

Hey Crunch

While I agree with most of your post & welcome by the way, I don't at this time see the chairman taking advantage of the dip in price any time soon. His objective was to make sure he gained control of or blocked the sale of (which he now has) the company. From a shareholders perspective now we have to insist on the removal of the not so independent directors that sit on the board.

As mentioned earlier on this thread there is a process underway for us to have better representation at board level so vote in favour of it when it is time. At the AGM we must insist that a resolution is tabled to provide us with a mechanism to achieve this. Some fund managers have got together & kick started this request so lets support them to voice our concerns collectively. This is our best & most pragmatic option.

The share price I would like to think has reached a base price give or take the odd deal going through by an exasperated holder, however going north from here will be a very slow process. Today's action is still quite above my average buy in but way above my patience/frustration levels.....!

[myusuf]

Sold out 100k @R1,50 today - was supposed to be my 10 bagger but 20k in the red instead

[Crunch]

Hi....

 

I'm new to this forum and have been an investor in WSL for a while.  I'm not impressed with the trading statement which historicially

seems to have been issued the friday before the results.   I'm not convinced that the Wescoal directors only now realise that the results for the period to be reported on will differ by more than 20% from the previous corresponding period.   It is clear to me that a trading statement of this nature is likely to concern shareholders as can be seen by the current decline in the share price.... which I would think could also have been anticipated.   From a technicial perspective this leaves us with support at approx R1.12.   From a practical perspective this will afford Mr Ramaite an opportunity to continue to build his position within this company at a considerable discount to what I would consider to be fair value. Ultimately once Wescoal have a signed agreement from  Escom, there will be more certainty with regard future earnings.   In terms of earnings -  the rehabilitation liability has cost approximately 6c per share which equates to the lions share of earnings over the last six months.... I must question why shareholders were not notified of this impending liability timeously.   It will be interesting to see how much the settlement of mediated exit packages have cost shareholders.   Significant increases in doubtful debt are concerning.... It's all about managing the three "what's"   WHAT 1 ..... what youv'e planned to happen   WHAT 2 ....what didn't happen   WHAT 3 ..... what the hell you're going to do about the disparity between the two ............ management, pure and simple is about reducing the disparity between the current outcome and the desired result.

[Sugafoot]

@Soutie,<br />I'm going to use your 3day rule here

[soutie]

@ Sugafoot Yip have to agree with you there.

Management just have to up their game collect in the monies owed push Eskom for the off take agreement & roll out Elandspruit efficiently.

Lastly please please please don't think you're smarter than the market sneaking in a dismal trading statement at 16:55 on a Friday & think nobody will notice...! We've been patiently waiting for it "FFS"....! Plus who authorized the delay in releasing the statement surely they knew waaaaaay before Friday that loses would be more than 20% so flouting the rules also strips away at credibility of management...!

If the market was made aware say 3-4wks ago earnings would be impacted by the previous years profit on the sale of an asset doesn't sound so bad...?

Expecting a little rush for the door at open...

[Sugafoot]

Been catching up on Twitter-land.<br />Lots of expectations by some fund managers and market students that there are once-off recurring charges, as you've stated Soutie.<br />

[soutie]

Basically through all their corporate activity of late plus the possible buyout people, well I certainly was, expecting better. Earnings are flat year on year if you strip out the Vlaklaagte sale. Why I say that it will drop +20-30% on Mondays open is people will move on & Mr Market will lose all patience with WSL & it will be relegated to an "OFF" the radar type of counter. Sorry to say but add the more recent boardroom spat with the chairman coming out on top & "inserting" his guy there's just a lack of professionalism in the air surrounding WSL. I hope I'm wrong as WSL doesn't deserve to be labeled a risky penny stock but that sure looks like the direction we're heading.  

[Sugafoot]

😳 absolutely horrible, and I'm not even an accountant. If it hits 110c, what options does one have?

[soutie]

Then again Keaton's trading update released just after makes for grim reading.

Stealing on a massive scale, Eish how do you not pick that up...?

[soutie]

Trading statement out & it's a shocker R1.10- R1.30 come Monday.

[myusuf]

waiting for that Trading statement! come on already

[soutie]

Pre-result jitters no trading statement issued to date so nervous sellers off-loading no real volume to speak of lately either.

Pretty turbulent year for shareholders when it could of been so so different.....

I don't really combine WSL with the broader resource market cos they're just not big enough. That may change after this set of results but only on the trading side with the McPhail acquisition.

The next hurdle is the off-take agreement for Elandspruit ROM with Eskom then positive roll out of the mine plan on time & under budget. 

The situation from a market/share appreciation point is starting to frustrate holders like myself who see opportunities elsewhere while knowing that I'm sitting on a winner in WSL. I mentioned earlier on this thread that it's starting to look very much like a value trap, management have to start to ratchet up their performance & not just plod along otherwise easy funding that they have access to will either become much more expensive or dry up altogether no matter how their BEE card looks. 

Here's to a more pro-active/aggressive 2015/2016 with no more head office antics to keep us back...! 

[myusuf]

HEPS expect it to be around 25 (Interim Hep 15c and Revenue doubled) - Effective PE is very low +-6

 (optimistic 28-30)

On pure financials share is dirt cheap but the market sentiment for resources is negative so catching a hiding at present

[soutie]

Been given confirmation results out on the 23rd

[myusuf]

Share is just dropping....

[soutie]

Some interesting information was divulged this morning. All is ready to go go go at Elandspruit just the funding will only be made available by Investec on condition of a signed contract with Eskom. The board have committed to being 51% black owned by December 2016 & have communicated this to Eskom. There is also some encouraging possible extentions to both Khanyisa & Intabane life of mine of some 5yrs apiece at current yields, admittedly some of the jargon baffled me be I 'm fairly sure that's the jist of it.

As mentioned further down this thread they are completely into Eskom to the tune of 80% of their 2mtpa.

Whenever the deal with Eskom is signed +/-16wks later will be the first coal out of Elandspruit which will bring it up 80% of 4mtpa.

Questions around the boardroom squabble proved to be a little tetchy but the Chairman comes across as very positive on the prospects going forward & lets face it his money is where his mouth is. Acting CEO.....Hmm jury's out on that one....Lead Independent Director well no thanks......So it's a good thing some more substantial shareholders have asked for better independent representation at board level a good thing me thinks let's hope it materializes.

Lastly wage negotiations with unions have been concluded at one mine & should be concluded at the other early next week.

They were quite cagey about financials in a closed period Re: year end results due about last week of June.

Cheers.