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GRR, GRANGE RESOURCES LIMITED
mullokintyre
post Posted: Jun 8 2021, 12:42 PM
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In Reply To: nipper's post @ May 15 2021, 04:22 PM

Mr market seems not to agree.
The price is down to the low 50's, and yet it has a P/E of 3 and a yield of 5.8%.
The attractiveness of its high content iron ore pellets have not diminished.
Seems like a low risk investment.
The price of high content fines would have to come off a long long way before it starts to lose money.
If that price does drop to loss making territory, it will likely be for a major disaster reason, in which case it won't help whatever you are holding.
Have piled in at these prices.
Mick



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nipper
post Posted: May 15 2021, 04:22 PM
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In Reply To: nipper's post @ May 15 2021, 04:17 PM

further expressed in this AFR article:

https://www.afr.com/companies/mining/china-...20210426-p57mdp
QUOTE
Steelmakers have traditionally paid a premium to that 'benchmark' price for the higher iron content in pellets and the efficiency benefits, both cost and environmental, of lump iron ore.

Lump ore can be added directly to a steelmaker's blast furnace without the energy-intensive sintering process that is required before iron ore 'fines' products are added to a furnace.
Some Chinese provinces had placed limits on sintering, particularly during the northern winter, in a bid to reduce pollution.

"Steel mills in China have been reluctant to replace lump with sintering fines so far this year due to both emission control requirements and productivity considerations," said analysts at S&P Global Platts.

... with approximately 65 per cent iron content, this implies Grange is receiving more than $US250 per tonne ($321.78 per tonne) for its pellets at the moment; the company's unit costs last year were $99.77 per tonne, excluding royalties and administration costs.



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: May 15 2021, 04:17 PM
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In Reply To: mercury's post @ Oct 18 2014, 05:04 PM

Grange still at it and in a bit of a sweet spot. From somewhat glory days in the previous resources boom, by the GFC / late 2008 GRR was in a slump and tried to rally into 2012 to 2013. Then it bounced along the bottom, 10c to 20c range for the best part of a decade.


Dec 2020 saw a significant upgrade of resource and the SP has doubled in 2021, closing at 54c this week
QUOTE
• Ore delivered from Main Ore Zone supporting 2.5 million tonnes of Concentrate.
• Exploration Decline and Bulk Sample Drive complete.
• Steel Pan Conveyor installed at Port Latta Pellet Plant.
• Furnace number four redesign progressed

And of course 2.5 million Tonnes is not a huge amount, but the NW Tas operation is lean, and current iron ore price tailwinds have helped.
In the context of Chinese buying, rising steel prices, shortfalls in supply from Australia and especially Brazil and, more importantly, the growing crackdown on pollution and capacity has seen a shift in uptake from what is the major world player. Environmental concerns and the move from large operations with blast furnaces to smaller outfits utilising electric arc furnaces are also at ply.
QUOTE
Iron ore prices will remain volatile and demand for products such as pellets and the 65% Fe fines from Brazil, will rise because they take less energy and involve fewer emissions to turn into steel.

For Australian companies like BHP, Rio Tinto, Fortescue, Roy Hill, Atlas and Mineral Deposits this is bad news. For the country's only pellet maker ; Grange Resources , with its Tasmanian operations, it's good news.
These issues are explored further in this article:

https://www.sharecafe.com.au/2021/05/14/iro...ie-of-the-land/



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
bam_bamm
post Posted: Oct 20 2014, 08:05 AM
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In Reply To: mercury's post @ Oct 18 2014, 05:04 PM

I didnt think the costs were that high. I'll have to do some further digging.
I'll get back to you if I find anything



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mercury
post Posted: Oct 18 2014, 05:04 PM
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In Reply To: bam_bamm's post @ Oct 17 2014, 11:58 AM

Yes financially safe....but , according to a previous chart indicating costs....(which the presso didn't tell) the sales at 103$ is just 5 $ over cost to produce (it was charted at 98$ but I don't know what that all entailed) .
Now I am not trying to downramp. In fact I would like some discussion so that I can get my head around their real costs.
In 2012 the cash costs were around 112$ per ton. Then some remediation was necessary at savage river and the costs escalated to 118$ per ton. Now , they have cut expenditures where they can....and I would like to know the cash costs. In fact I would really like to know how they added 30 million into the kittly, if the sales costs of $112 are applied. The cash costs must have dropped some.
I figure that 835,000 tones of product at a 30 million profit is 35$ profit per tonne....which means cash costs would have to drop from 112 to 77 $ per tonne. (not likely)

bamm bamm can you help here.?

thanks
Merc

 
bam_bamm
post Posted: Oct 17 2014, 11:58 AM
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Have been in and out of GRR successfully over the years. ("in and out" reminds me of a joke about a couple of ducks, one named puddles..)

Quarterly released today, indicates that GRR is currently below cash backing. And they have a lot of quality pellets ready to be sold too.

I wonder if management are thinking of recommencing dividends? Anyone else watching GRR?



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macduffy
post Posted: Jan 20 2014, 12:48 PM
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From FN Arena - if anyone's interested in GRR these days:

[/size]Macquarie ratesGRR as Outperform (1) - December quarter production was strong, aided by arecovery in grades and improved pellet premium. Macquarie notes the recovery atSavage River was faster than anticipated and 2014 production expectations havebeen upgraded.

The company is generating free cash flow at arate that, if maintained, could allow the cash balance to exceed current marketcapitalisation in less than a year, in Macquarie's estimation. Hence, thebroker believes there's upside risk to the 2c dividend forecasts, with the fullyear earnings to be released in late February.

The Outperform rating is maintained and the pricetarget is raised to 33c from 30c.

Target price is $0.33 Current Price is $0.24Difference: $0.09 If GRR meets the Macquarie target it will returnapproximately 38% (excluding dividends, fees and charges).

The company's fiscal year ends in December.Macquarie forecasts a full year FY13 dividend of 2.00 cents and EPS of 2.10cents . At the last closing share price the estimated dividend yield is 8.33%.

At the last closing share price the stock'sestimated Price to Earnings Ratio (PER) is 11.43.

Market Sentiment: 0.7

How do these forecasts compare to marketconsensus projections?

Current consensus EPS estimate is 3.4, implyingannual growth of 9.3%.Current consensus DPS estimate is 2.7, implying aprospective dividend yield of 11.1%.Current consensus price target is $ 0.30,suggesting upside of 23.6%(ex-dividends).Current consensus EPS estimatesuggests the PER is 7.1.

All consensus data are updated until yesterday.FNArena's consensus calculations require a minimum of three sources

[size="3"]


 
macduffy
post Posted: Jan 17 2014, 10:20 AM
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Another strong quarter from this unloved, overlooked iron ore miner.

http://www.asx.com.au/asxpdf/20140117/pdf/42m55x81dng8jz.pdf



Yes, I hold a few.

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mercury
post Posted: Aug 13 2013, 08:49 AM
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In Reply To: macduffy's post @ Aug 13 2013, 06:13 AM

yeah you are right. I was overdoing it. But yes, I agree with you.....not much chance of it progressing without a few upticks in price and stability in economies....and a few iron ore potential producers shutting down. I feel that companies like SDL, should they ever get going, those kind of projects make GRRs project less likely.



Merc

 
macduffy
post Posted: Aug 13 2013, 06:13 AM
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In Reply To: mercury's post @ Aug 13 2013, 03:26 AM

No, not dead in the water - but definitely on the backburner meanwhile!

sad.gif

 
 


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