AIM Soiree Butler Polo Resources POL.L

Polo ResourcesPolo Resources Limited (AIM and TSX: POL) is a globally focused natural resources and mine development investment company. We select, acquire and manage substantial investments in companies and projects with strong value enhancement potential and attractive growth prospects, and utilise this ability to deliver value-adding returns.

Polo Resources is trading above the moving 50 day average and above the moving 200 day average on above-average volume.
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  • Re: Orchard Gate by Orchard Gate
    Thu, 18 Dec 2014 13:13:00 GMT

    Oh dear fusion, the truth hurts too much, does it? Can't stand the pain?

    p.s. 'you're', not 'your. By Orchard Gate
  • Simon Thompson by Gwynfryn1
    Thu, 18 Dec 2014 13:12:00 GMT

    Shares in Aim-traded investment company Polo Resources (POL: 7p) have proved a volatile investment since I included them in my 2013 Bargain share portfolio. I last updated my view on the company ahead of this month’s full-year results when the price was 8.5p (‘Polo’s waiting game’, 4 November 2014) and recommended holding onto them at the time.

    Those figures were announced yesterday and the company has sensibly taken a close look at all its commodity investments and taken a realistic view of their current worth. Inevitably this has led to write-downs, the largest of which has been on Polo’s Nimini Komahun gold project in Sierra Leone. Following the outbreak of ebola in the country, and the declaration of a state of emergency, Nimini has moved to a care and maintenance footing until the crisis is over.

    To recap, the Mine Development Agreement which will establish the fiscal regime for the development was signed in February by the minister of mineral resources to Sierra Leone’s government. Subsequently, Nimini was advised that certain terms needed to be renegotiated ahead of ratification by parliament. However, the outbreak of the ebola virus has led to a postponement of those negotiations. Polo has written down the investment by $31m to $20m, or £12.7m, which equates to 4.5p of its net asset value of 27.2p a share. The last Mineral Resource Estimate showed a resource of 890,000 ounces of gold at the project.

    Sensible accounting

    The company has also marked to market value all its listed investments. These include holdings in Aim-traded Banglasdesh coal project developer GCM Resources (GCM: 15.75p); Australian listed Celamin Holdings NL (CNL:ASX), a company holding phosphate interests in Tunisia; Western Australian gold explorer Blackham Resources (BLK:ASX); and Aim-traded Namibian copper explorer Weatherley International (WTI: 2.5p). Combined these four investments are worth 2.3p per Polo share. Polo has made investments in the last three companies in the past six months to try to take advantage of the sharp fall in commodity prices and the favourable environment for making investments in this area. It reviewed no fewer than 40 potential investment opportunities as part of this process.

    Time will tell whether any of these pay off, but frankly they don’t have to because at the current price all of Polo’s investments are in the price for free. That’s because as of 12 December 2014, Polo had cash, receivables and short-term deposits of $35.6m (£22.6m) on its balance sheet, or the equivalent of 8.3p per Polo share. This means that 1.3p of cash on the balance sheet and all of Polo’s unlisted investments worth 16.6p per Polo share are in the price for free too.

    So even if you ignore the 4.5p per Polo share represented in the company’s net asset value of 27.2p by the Nimini investment, and ignore the value of all the aforementioned listed investments worth 2.3p a share, then there is still value to be had in Polo’s unlisted holdings, worth 11p a share.

    Valuable investments

    As I have noted before, the key value creation for Polo shareholders still lies in its 42 per cent stake in Signet Petroleum. Following Signet’s farm-out deal with Shell in Namibia in February this year - which led to a $22.8m cash payment to Polo, worth 5.1p per Polo share – Signet has invested $10m of its retained sale proceeds in Regalis Petroleum, a company that has been developing oil concessions in both Chad and Namibia and owns a 70 per cent interest in Block 2813B in the Orange Basin, nearby the Kudu discovery and the former Signet Petroleum block. This gives Signet a 9 per cent shareholding in Regalis. Polo already has a 7 per cent direct interest in Regalis so in effect now has a 10.78 per cent combined interest, worth $12m in total, or the equivalent of 2.8p per Polo share, through its 42 per cent stake in Signet.

    Importantly, the investment in Regalis by Signet was pitched at the same price - $2.25 a share – as all of Regalis’ o By Gwynfryn1
  • Re: The Comedians by spotyplonka1
    Thu, 18 Dec 2014 11:47:00 GMT

    "the Company offers investors a more balanced risk investment exposure to the metals, mining and energy sectors" By spotyplonka1
  • Orchard Gate by Fusion98
    Thu, 18 Dec 2014 09:46:00 GMT

    alright we get it, your upset because your investment didn't go the way you planned it
    Now give it a rest.

    Iggy bin for you
    Fusion98 By Fusion98
  • The Comedians by Orchard Gate
    Thu, 18 Dec 2014 08:52:00 GMT

    "the Company offers investors a more balanced risk investment exposure to the metals, mining and energy sectors"
    By Orchard Gate
  • Re: rns by spotyplonka1
    Wed, 17 Dec 2014 18:24:00 GMT

    personal map for newbie reference...

    Sizing equipment for open pit mining – a review of critical parameters

    https://www.google.co.uk/url?sa=t&source=web&rct=j&ei=yciRVMflEMX3UJu1grgB&url=https://www.u-cursos.cl/ingenieria/2010/1/MI3130/1/material_docente/bajar%3Fid_material%3D280556&ved=0CCMQFjABOBQ&usg=AFQjCNGF1TUk9U_4-llxBGFHT2SI3y_u7g&sig2=1XQf4kqXR6i8VdiWgY_G4w By spotyplonka1
  • Re: rns by Gwynfryn1
    Wed, 17 Dec 2014 17:06:00 GMT

    New post on Closet Indexer


    Polo Resources – Annual Results Update
    by closetindexer

    Polo Resources - Results Update
    Polo Resources (finally) released their results for the year to 30th June 2014. You can read the results yourself here: link so I won't bother repeating what's written there. Suffice to say the income statement was vaguely encouraging (income from subs is up) despite the Nimini writeoffs, the balance sheet was helpful and interesting, and the lack of a detailed asset valuation was disappointing - maybe in the annual report!
    The original recommendation post can be found here: https://closetindexer.wordpress.com/2014/09/24/a-pit-of-money-polo-resources/
    The real nuggets of gold in the results are the commentary on the individual investments which did contain a couple of useful numbers.

    Balance Sheet
    Cash & Receivables
    Cash at 30th June was $30.6m. I've adjusted for the 2 post-results investments (Celamin and Weatherley) and converted everything to GBP to give £22.8m of cash (more than the market cap!).
    Listed Equity Investments
    Nothing of real interest here. Taking the % holdings of the various listed investments and using their quoted share prices for valuation purposes we have a total value of £5.1m
    Non-Listed Equity Investments
    There was some very nice information here discussing the progress, status and reserves of all the various equity investments. No valuation for Signet was given (I expect we'll find this in the notes to the FS when the annual report is released) but they did give a recoverable amount valuation for Nimini of US$20m.
    In addition, there was some detail given on the implied valued of Regalis. Signet invested $10m for an equity stake of 9% giving an implied valuation of Polo's 7% stake of $7.78m ($10m / 9% x 7%) = £4.95m.
    There were no other interesting numbers so for valuation purpses we still have to rely on the older NAV investment update (link) and the interim results (link
    Other Assets & Liabilities
    Nothing of real interest here. Some trade receivables, PP&E, intangible development licences and payables (most likely all from group consolidation).

    Valuation
    Polo stated their estimate of NAV was around 27p (around 280% upside to current share price). However, I take a more prudent approach and apply some severe discounts to their assets to give a more conservative NAV. My write downs include:
    • GCM down to £0
    • Intangibles down to £0
    • Cash down by 10% to account for future operating costs etc.
    • Receivables down by 50% for bad debts, collections etc.
    • All other assets and equity investments down by 60% to account for uncertainty in their reserves and operations and valuation
    After applying these hefty write downs, we arrive at a bear-case NAV of 16.3p, which is 134% upside to the current share price. Net cash is currently around 6.6p (after a 10% discount) which acts at a theoretical downside buffer. To paraphrase a skeptical friend: "basically you're buying the net cash and if any of their assets are worth something it's free upside".
    Polo Resources remains a high-conviction idea and further purchases have been made in the Closet Indexer Portfolio (big update coming early January).
    Links
    Original Investment Recommendation: https://closetindexer.wordpress.com/2014/09/24/a-pit-of-money-polo-resources/
    30 June 2014 Results:
    link
    31 Dec 2013 Interim Results: link
    Most Recent NAV Breakdown: http://ww1.investorrelations.co.u By Gwynfryn1
  • Re: rns by spotyplonka1
    Wed, 17 Dec 2014 15:23:00 GMT

    ot vid whilst waiting for divi.
    ...on the back of it a little open cut yields a lot of puss

    link By spotyplonka1
  • Re: rns by Orchard Gate
    Wed, 17 Dec 2014 14:43:00 GMT

    "the Company offers investors a more balanced risk investment exposure to the metals, mining and energy sectors"

    I assume they inserted this as a joke, give everyone a bit of a laugh at Christmas.

    If it offers investors a "better" risk exposure how do they explain that shares in Polo, YTD, are down roughly 70% when the metals and mining sector is down less than 10%? How is that 'better'?

    I think they are taking the mick out of you lot. By Orchard Gate
  • Re: rns by spotyplonka1
    Wed, 17 Dec 2014 13:12:00 GMT

    link
    link
    link By spotyplonka1
  • Re: rns by spotyplonka1
    Wed, 17 Dec 2014 12:54:00 GMT

    it was not Tang that brought GCM or the gold in Africa

    link By spotyplonka1
  • Re: rns by next-time-lucky
    Wed, 17 Dec 2014 12:36:00 GMT

    The report was showing a good strategy IMHO, the writedown in asset value was dictated by conservative accounting, but I have always thought the gold project as too small and best sold off. The commodity cycle will turn, my impression of phosphates is that it is better business than gold or oil, not stelluar but steady. The BOD are well placed for the future, it was not Tang that brought GCM or the gold in Africa, the money recently spent looks positive IMHO. In fact most of the institutions WANT higher inflation which for commodities means longer term higher prices. By next-time-lucky
  • Re: rns by alpal
    Wed, 17 Dec 2014 08:58:00 GMT

    "Through our transaction driven business model, the Company offers investors a, more balanced risk investment exposure to the metals, mining and energy sectors."

    What nonsense in the Annual Results. Over 18 months we have ONE transaction in Signet, the rest is just spending money which any id**t can do. So much for a 'transaction driven business model'.

    However I am surprised not to see all the directors rushing in to buy these shares at this fantastic value. By alpal
  • Re: rns by Small Holding
    Wed, 17 Dec 2014 08:34:00 GMT

    So assets of 27p a share
    a share price under 7p
    over $30 million in the bank
    and a market cap of £19 million

    Why aren't they buying their own shares for cancellation?
    £1 worth of assets for about 25p

    I know, there are better investment opportunities out there By Small Holding
  • rns by searchers-son
    Wed, 17 Dec 2014 07:14:00 GMT

    Net Asset Value per share as at 12th December 2014 was approximately 27.2 pence per share. By searchers-son
  • RE: ST by 50glass
    Thu, 18 Dec 2014 13:11:34 GMT

    And it is clear to see the effect your purchase has had on the sp. Thanks! (a grateful long-term holder of POL).
  • ST by WatchMaverick
    Thu, 18 Dec 2014 13:03:12 GMT

    Nice update from Simon Thompson today in IC - as he says and we can all see from the balance sheet the cash covers the market cap so all assets are free...its simple decision to buy this one. Lets hope the company do a share buy back soon. I added 100,000 shares to my holding.
  • RE: Celamin, again by NathanBryce
    Thu, 18 Dec 2014 08:28:53 GMT

    Thanks for these updates. Appreciated.
  • Celamin, again by Masterbaker
    Wed, 17 Dec 2014 23:00:52 GMT

    They just don't stop,

    link

  • RE: 27.2 by 50glass
    Wed, 17 Dec 2014 19:23:08 GMT

    Having spend the last hour going through the annual report I'm left with the conclusion that it has more holes than a colander. I fear I may have to devote time to attend the AGM to button-hole the BOD.
  • RE: 27.2 by okenia
    Wed, 17 Dec 2014 17:18:34 GMT

    They mentioned the cash last time, the absence this time suggests it has been spent, otherwise they'd be flagging it up as their warchest to use to go shopping during a generational sip in the junior resources sector.
  • Results by grahamscotland
    Wed, 17 Dec 2014 16:03:52 GMT

    Found some analysis. Looking good!

    link

  • RE: Hmmm by Drew57
    Wed, 17 Dec 2014 14:36:54 GMT

    Following my email to Polo and their IT support link, this 404 problem was speedily resolved.
  • RE: 27.2 by 50glass
    Wed, 17 Dec 2014 12:24:26 GMT

    Text of an email sent today to Polo: "As a shareholder who has read the latest year-end results I would appreciate confirmation of: a) when will you publish a breakdown of the NAV by investment, b) what is the cash only element in the combined figure stated for 12 December 2014." Let's see if it produces a response.
  • RE: Hmmm by 50glass
    Wed, 17 Dec 2014 11:22:15 GMT

    And when you do see it you will be disappointed that amongst other omissions: a) there is no breakdown, by investment, of the NAV, b) given the post year-end transactions, there is no breakdown of the current cash position - rather cash is 'hidden' in a fairly unhelpful cash, balances, etc. figure. All-in-all the BOD has failed to give this investor the information to which he feels entitled.
  • Hmmm by Drew57
    Wed, 17 Dec 2014 10:53:33 GMT

    Would like electronic copy of results so hit 17 December link on Polo website home page. Oh dear; crashes with a 404 Not Found error. Not very professional.
  • 27.2 by IREB499
    Wed, 17 Dec 2014 10:26:36 GMT

    Only 3p out 50glass. Pretty good shot.
  • RE: RNS by Masterbaker
    Wed, 17 Dec 2014 07:24:45 GMT

    On 12 February 2014 the Company announced that Signet had concluded the sale of its interests in Block 2913A/2914B in Namibia to Shell Exploration and Production in a confidential transaction, and thereafter, implemented a dividend in specie and a share buy-back offer. Polo received approximately US$22.8 million in respect of the buy-back (equivalent to approximately 5.1 pence per Polo share) which was reinvested in the Company to help unlock value in the existing portfolio as well as being available to acquire further undervalued and high potential assets in accordance with its investing policy. · Celamin Holdings NL o In March 2014, the Company acquired a strategic 12.7 per cent stake in Celamin Holdings NL (ASX: CNL), an ASX listed company holding phosphate interests in Tunisia. In December 2014 Polo increased its interest in Celamin to 33.23 per cent. o Celamin is advancing a bankable feasibility study on the Chaketma phosphate project, Tunisia. Drilling to date has intersected thick mineralised zones averaging over 15 metres at favourable depths, outcropping at surface in places and at grades that generally exceed 20 per cent phosphorous pentoxide (P2O5). Independent metallurgical studies have verified the potential to produce marketable concentrate acceptable to international offtakers. · Blackham Resources Limited o In March 2014, the Company acquired a 4.2 per cent interest in ASX listed West Australian gold explorer Blackham Resources Limited (ASX: BLK). In May 2014, Polo increased its interest in Blackham from 4.2 per cent to a combined direct and indirect holding of 11.85 per cent. o Blackham has a substantial prospective exploration package with a combined host JORC Resource of 40 Mt at an average grade of 3.3 g/t gold for 4.3 Moz. · Weatherly International Plc o In November 2014, the Company subscribed for new shares in Weatherly International Limited (AIM: WTI), an AIM traded mining, development and exploration company focusing on Copper in Namibia representing an interest of approximately 7.06 per cent in Weatherly's enlarged issued share capital. o In accordance with terms of the Subscription Agreement with Weatherly, Polo has the right to subscribe for a further 51,984,748 Weatherly ordinary shares at the subscription price of 2.925 pence per share, before 7 February 2015 which would increase Polo's interest to approximately 12.88 per cent of Weatherly's enlarged issued share capital. o Weatherly's Namibian copper assets include the Otjihase and Matchless producing underground operations and the open pit Tschudi Project which is expected to be in production in the second quarter 2015. Tschudi is designed to produce 17,000 tonnes of copper cathode per year with an 11 year mine life. Michael Tang, Executive Chairman of Polo, said: "The year under review has been one that has seen Polo sig
  • RNS by Masterbaker
    Wed, 17 Dec 2014 07:10:31 GMT

    YEAR ENDED 30 JUNE 2014 Polo Resources Limited (AIM: POL), the natural resources exploration investment company with interests in oil and gas, gold, coal, iron ore, phosphate and copper, today announces results for the 12 months ended 30 June 2014. Financial Summary · Combined total of cash, receivables, payables, listed and unlisted equity investments of US$117.8 million as of12th December 2014. · Net Asset Value per share as at 12th December 2014 was approximately 27.2 pence per share. · Value of unlisted investments amounted to US$75.6 million and long term listed investments marked to market value amounted to US$6.6 million as at 12 December 2014. · Loss on ordinary activities after taxation of US$19.1 million, significantly attributable to prudent provision against Nimini's Sierra Leone Gold project of US$28.2 million and goodwill write-off of $2.8million, following the ebola crisis and weak gold price outlook. Operational Highlights · Nimini Holdings Limited o Nimini filed an independent Mineral Resource Estimate ("MRE") for its Komahun Gold Project ("Komahun") in eastern Sierra Leone in August 2013, which included a significant increase in Mineral Resources at the Komahun Deposit. The MRE resulted in an Indicated Mineral Resource of 0.55 million ounces ("Moz") (3.65 million tonnes ("Mt") at a gold grade of 4.69 grammes per tonne ("g/t")) and an Inferred Mineral Resource of 0.34 Moz (2.61 Mt at a gold grade of 4.08 g/t), and was restricted to potentially mineable Mineral Resources at a 2.4g/t cut-off grade. o Field programmes have identified targets for future drilling both proximal to the Komahun Deposit and within the greater Mining Licence area. o The Environmental and Mining Licences for Komahun were renewed for 2014/2015. o The Mine Development Agreement ("MDA"), which will establish the legal, fiscal and operating regimes for the development and commercial exploitation of Nimini's gold project, was executed by the Minister of Mines and Mineral Resources in February 2014. However, Nimini was subsequently advised by the Minister that Government of Sierra Leone ("GoSL") requires certain of the terms to be re-negotiated. o The outbreak of the ebola virus, the subsequent state of emergency declared to combat the virus, GoSL's focus on that issue and restrictions on travel to Sierra Leone, have unfortunately resulted in the MDA negotiations having to be postponed and site activities being ceased. As soon as the situation improves the primary focus will be to conclude the MDA negotiations such that the MDA can be put before the Sierra Leone Parliament for ratification. · Signet Petroleum Limited o On 12 February 2014 the Company announced that Signet had concluded the sale of its interests in Bloc
  • RE: rns by fatherjockstrap
    Wed, 17 Dec 2014 07:07:15 GMT

    Net Asset Value per share as at 12th December 2014 was approximately 27.2 pence per share.