Griffin Mining - golden future! http://www.basemetals.com/

GFM deserves a new thread after todays AGM. For the first time the venue was packed with shareholders, a tribute to the interest and support the company has for what the Board has achieved. For those unable to be at the meeting here are some of the points I noted which may interest folk on this BB.

Production: dry and wet testing now completed and zinc concentrate comes through the smelter next week. Zinc price on the LME is currently $1300/ton. GFM is being offered $1700/ton at the mine gate. This premium reflects the demand and difficulty local industry has in sourcing this basic metal ( As an aside the chairman reported that zinc is not easily and efficiently extracted as a recycled metal so newly mined zinc is always required). Cost of production is $595/ton ($700/ton if all depreciation costs are included). Labour costs are $1000/worker pa cf an Aussie underground worker of $130,000/worker pa. Apparently the 20m.pa worker migration from agricultural to industrial jobs means that there are queues of applicants wanting jobs at the mine; wage inflation is not an issue. 240+ employees on site to run the mine on a 24/7 basis.
Production can be increased w/o further investment for a throughput of 400,000 tons of ore pa; An increase to 500,000tons pa would require further investment of between $1m and $2m . All plant has been purposely over-engineered to ensure capacity can rise reliably and with back-up facilities (eg 3 boilers, 2 of which are back-up)
H&S is to world stds., setting an example to the rest of the Chinese mining industry which has a poor record currently because of the number of small private mines.

Reserves: 14.5years supply on current zone rising to 25 years in zone 3. Chairman showed an independent report which believes that the closure of many existing zinc mines is now producing a supply gap which will continue to improve the zinc price cycle to year 2012.

Profits: No problems known or foreseen to the repatriation of profits. However the chairman stated that the profits might achieve more for shareholders if the company uses these for further exploration and possibly buying back the companys shares. The latter move might help resolve the current shorting problem where it is thought that between 6 or 7 million shares are currently being shorted. This move could have a highly geared effect on increasing the share price and help deter the shorters/stock bashers from further activity.

Exploration: Chairman says company will be drilling a further 18,000m over the coming summer months and in his personal view he expects the company to steadily move towards becoming a gold mining concern, with some of the profits from the zinc smelting funding that work. An RC rig which costs 33% of the cost of a diamond drilling rig has been brought on to site.
Future exploration areas always being looked at + changes in Chinese Ministry of Land & Resources policy towards funding means that GFM will likely be offered many more prime government held assets in the near future.

Personal view is that GFM is a well and responsibly run mining company which is now likely to really grab a lot more attention as the profits start to flow as of next week. I am sure others on this BB at the meeting can fill the gaps where I have missed anything.

These share will easily reach 1.20 !!!!

When is the good news going to finish ????

well i bought in friday and again today...expected it to go to 120p today so maybe tomoro

maetro, much of the good new would have already been priced in, as investors were expecting this...

Too right, I'm out now having ridden this up form 33p a share.

Anyone know when results are due on these.
last year they were released in May, but TMI mentioned March.

Trading Places goes with Griffin Mining, watch the last ten minutes.

http://demand.global-mix.net/?o=gmuk-stockmarket-vod/trading_places-190207.wmv&.wvx

In answer to post 1056, results believed to be due 30th April 2007

Yay GFM break out...I've been waiting for this especially with results due soon and GFM like to add on a nice new juicey tipbit...I wonder what it will be this time :-)
Di

from th eother side;

TAKEN FROM MONEY WEEK.

Griffin Mining sparkled at 113p, up 6p, on buying ahead of Monday's results. Collins Stewart's target price is 139p.

http://www.thisismoney.co.uk/investing-and-markets/tips-and-tactics/article.html?in_article_id=419699&in_page_id=23&ct=5

Results are expected to be good and I like the sound of 139p which dosn`t sound unrealalistic.

hope not is this is any thing to go by and as someone as said already @ preseant
they are saying it could be lifted to 1.30 which would be a new year high.

Don't you just love GFM!! ...looking back to last year there was a 40% increase in share price from 60p- 101p leading up to the results and a couple of weeks beyond.
This year we had a market retracement which took GFM with it down to 90pish in March and a 40% increase on this would give us 126p but I have a good feeling we are going to get to 130p and above this year.
Di
dyor etc ...just musing really

Whats made griffin jump 5.5p today not complaining just seems a lot for one day
thats all.

Good results announced on 30 April see Griffin web site

Yes, and they went from 122p down to 109p , so that doesn't answer why they have gone up today.

It appears there is going to be a divided payed next week on the 6 see back of shares mag its got it in there it stated in the end of year figueres.

GFM's prospects look good, according to my reckoning after giving the news releases a quick scan. production increases ought to see this go higher.

FWIW I think part of the recent SP drop (apart from possible profit-taking) could be due to the fact that someone, somewhere included GFM in a list of "overblown Chinese stocks".

But I find it difficult to see how one can argue with 500,000tpa of zinc concentrate by end of 2007 and plans for gold, silver and lead recovery from the tailings.

I haven't bought (due to funds being tight, also considering other options), but thought I'd throw in my two penn'orth.

Good luck to holders. PDYOR, etc.

GFM's prospects have never been better and go from strength to strength - see below


Profit from China without leaving home

Shanghais stock market tumbled last week but you can take advantage of Chinas rapid growth through shares listed in the UK

David Budworth and Kathryn Cooper


CHINA, one of the most hotly tipped markets of recent times, has been prompting comparisons with the dotcom bubble after soaring 50% this year, only to drop 4% last week when the government sought to calm the frenzy.

Millions of Chinese investors have been ploughing their savings into the market in the hope of better returns, with almost 30m share trading accounts opened this year alone four times the total for the whole of 2006.

The recent flotation of Belle International Holdings, Chinas largest retailer of womens shoes, was more than 500 times oversubscribed by private investors. This is reminiscent of the frenzied flotation of Lastminute.com in March 2000, at the absolute peak of the tech boom, which was 40 times oversubscribed. The shares soared nearly 50% after issue, before plunging back.

There are even concerns that speculators have been borrowing against the value of their homes to invest in the stock market.

Tony Dolphin of Henderson, a fund manager, said: The Shanghai A index is up 155% in the past nine months and has soared through 2,000, 3,000 and 4,000 with hardly a pause in a manner reminiscent of the Nasdaq index in 1999 and 2000.

Alan Greenspan, the former American central banker who warned of irrational exuberance during the tech boom admittedly three years before it burst said he feared a massive contraction in Chinese stocks.

Last Wednesday, the government took steps to calm the frenzy when it trebled the stamp duty on share trading from 0.1% to 0.3%, which hit Shanghai shares and spread through the rest of Asia. Western markets escaped unscathed, however, unlike in February when a 9% fall in Shanghai knocked shares around the world.

Most analysts say that a further sell-off in China should not hit the rest of the world too hard, at least in the longer term, because it is still such a small part of world markets, and because its Asian neighbours are much stronger than they were in the last regional crisis in the late 1990s.

Kevin Gardiner, head of global strategy at HSBCs investment-banking arm, said: The A-share market [the Shanghai market used by domestic investors] is largely insulated from global indexes, and still relatively small at just 2.5% of global markets.

As we saw in late February, a material setback in Shanghai could doubtless trigger some contagion in the rest of the world, at least in the short term. Looking further ahead, however, we think that the global indexes can shrug off localised setbacks in some emerging markets because we suspect that there is potential for growth surprises from the rest of the world, including America.

Hugh Young of Aberdeen Asset Management also believes any collapse would only have a very local impact. He said: Chinas stock market is a domestic bubble with little foreign participation. The apocalyptic view is that the bubble will burst and cause an economic slowdown that would then hit the rest of the world. But I think it is a classic speculative bubble that will end in tears but will largely affect domestic share traders. The global impact will be limited.

A setback in China could even bring some buying opportunities in other shares. While Shanghai markets look overvalued at 48 times earnings, Chinese firms listed in Hong Kong, known as H shares, are at just 19 times earnings, according to HSBC Investments.

There may even be opportunities closer to home, in Londons Alternative Investment Market, where scores of Chinese companies have listed in recent years. Some are trading at price/earnings ratios of just 10, according to Patrick Evershed of New Star Asset Management. He said: If the Chinese market tumbles, so will these stocks but companies that are growing strongly and are on a low p/e shouldnt be as badly affected as most.

We asked the experts to recommend Chinese shares you could invest in closer to home.

China Shoto

The firm makes most of its profits selling batteries for mobile phones. China Mobile, the countrys largest telecoms provider, is one of its biggest customers. Mobile-phone use is getting a big boost because 3G technology is being introduced for the Beijing Olympics next year. The shares cost 176p on Friday.

Evershed said: Another big growth area for the business is batteries attached to bicycles, driven by the need for cheap transportation. Production of these bike batteries has gone up by 50% over the past two years to meet the strong demand.

Griffin Mining

This is not strictly a Chinese company it is domiciled in Bermuda and its main office is in London. However, it makes most of its profits from mining and processing zinc, which is used to galvanise steel, at a mine 124 miles from Beijing. Its shares cost 112p.

Evershed said: Griffin has been growing rapidly. Its turnover in 2005 was $6m (3m), last year it went up to $43m and in the current year it is expected to rise to $63m. The company has $40m of cash on the balance sheet so its a good long-term growth stock.

Renesola

Merrill Lynch, the investment bank, thinks shares in this Chinese solar-panel maker could soar from 539p to 800p over the next year.

However, Giles Hargreave of Marlborough Fund Managers issues a note of caution. He said: Renesolas shares were cheap when it came to the market but as investors have recognised their value they have shot up. I have taken some profits after such a successful run but I still think it has some way to go.

Prosperity Minerals

China has become the worlds largest cement producer with an output of 1 billion tonnes a year. Domestic demand is expected to reach 1.2 billion tonnes by 2010. Cement is expensive to move around so it needs to be made by local firms such as Prosperity, one of Hargreaves favourite stocks at 153p.

Haike Chemicals

This company refines crude oil into gasoline and diesel in China and its business has boomed as the economy expands. At present it is forced to sell its oil at artificially low prices set by the government, but these controls are expected to be lifted later this year. The shares currently cost 194p.

Standard Chartered

It was rumoured recently that Chinas new state investment fund could take a stake in the emerging-markets bank, lifting its shares. They currently cost 17.27.

Charles Deptford at Baring Asset Management would not be surprised if a takeover bid materialises. He said: This would be a strategic investment for the Chinese government as it would boost its global financial profile. It would also give it direct exposure to other parts of Asias financial markets.

Even if it is not taken over, it is still a good bet on Chinese growth because two-thirds of its profits come from the region.

Funds

Most of the funds available to UK investors steer clear of Shanghais A shares and invest instead in Hong Kong, or other countries such as Korea and Taiwan that have benefited from the China bandwagon. Justin Modray of Bestinvest, an adviser, recommends funds such as Aberdeen Global China Opportunites and First State Global China.

Hi
Could anyone tell me if they have received their dividend payment yet ?
I use the IWeb platform, and they tell me they haven't received the payment.
Thanks.

I received mine in the post last thursday or friday, if that helps at all