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AIM-listed Shanta Gold (SHG) has announced another director share purchase which looks to me to be more of a sell signal than a buy signal. I previously highlighted (HERE) that CEO Toby Bradbury had changed his mind about supporting the recent fundraising by ponying up for 500,000 shares at the offer price of 6.5p – instead completing half of promised purchase in the market at the reduced price of 5.65p. Today we learn that NED Robin Fryer has put his hand in his pocket to the tune of 45,000 shares at 6.2p.
As much as it pains me to highlight this, as I hold a (very) small handful of shares here, I note with interest an announcement at 4.17pm yesterday afternoon (almost no-one-is-watching o'clock) from AIM-listed Shanta Gold (SHG) which simply strikes me as a spoof. It is a director buy, but I fear that it is a sell signal. Here is why.
East Africa-focused Shanta Gold (SHG) lifted output at its flagship New Luika gold mine in south-west Tanzania 20% to 29,139 oz. between the third and second quarters of last year and indicates full-year production for 2015 was 81,873 oz. That is down from 84,028 oz. in 2014 but ahead of more recent guidance suggesting between 72,000 oz. and 77,000 oz. for last year. Is this a recovery buy?
John Meyer of SP Angel this morning comments on Shanta Gold (SHG), Rio Tinto (RIO) and Vedanta (VED) as well as offering a detailed macro view on the news that is shaping global mining and the AIM mining pond.
John Meyer of SP Angel this morning comments on Caledonia Mining (CMCL), DiamondCorp (DCP), Kefi Minerals (KEFI), Mariana Resources (MARL), Petra Diamonds (PDL) and Shanta Gold (SHG) as well as offering a detailed macro view on the news that is shaping global mining and the AIM mining pond.
In upbeat mood, Toby Bradbury, chief executive officer of East Africa-focused Shanta Gold (SHG), has launched the Guernsey-based company’s underground feasibility study, base case mine plan and an updated reserve estimate for its operations in south-west Tanzania. These suggest the company’s flagship New Luika gold mine could produce an average 84,000 oz. a year for five years from the mine’s underground resources at an all-in cost of $640 (£421) an ounce for an initial five years, against a present gold price of $1,131.23c an ounce.
John Meyer of SP Angel this morning comments on Anglo Asian Mining, Ortac Resources, Shanta Gold, Stellar Diamonds and Vast Resources as well as offering a detailed macro view on the news that is shaping global mining and the AIM mining pond.
Shanta Gold (SHG) will this year apply ’a big focus on improving efficiency’ and bringing down costs at its flagship New Luika gold mine in Tanzania, while contemplating potential corporate deals and developing its prospects in the Lupa goldfields, the mining-friendly East African country’s second largest known gold deposit, along with Singida in central Tanzania. That is the word from Mike Houston
Mike Houston, boss of Guernsey-based Shanta Gold (SHG), is preparing for a busy autumn as the AIM-quoted company works to lift annual gold production at its Tanzanian gold project from a forecast 80,000 oz. this year to 100,000 oz. in two years time. Shanta, which produced 63,000 oz. in 2013 and lost a much-reduced £2.6 million on £40 million turnover, is expecting two feasibility studies in September or October on its currently producing New Luika mine in south-west Tanzania’s Lupa goldfield and its Singida project in the centre of this East African country. But how might the market react to this potentially positive newsflow?
Shanta Gold (SHG) is sounding confident after encouraging first-quarter production in the (currently) mining-friendly East African state in Tanzania. The company awaits boardroom departures shortly and bankable feasibility studies between July and September on two of its ventures: extending the life of its New Luika mine in the south-western Chunga district and its Singida project in the country’s central region. Chief executive officer Mike Houston says work on plant, processing and adding underground operations could potentially add another eight years’ mine life to wholly-owned New Luika, but will this be enough to list Shanta’s share price?
Although many second line Gold stocks doubled between July and September ahead of the no taper move from the Federal Reserve, there may well be more to come. The first rally could just be a dress rehearsal. That brings us to Shanta Gold (SHG) at 14.375p.
AIM-listed gold producer from Tanzania, Shanta Gold (SHG) has announced that it has restructured its bank debt facilities with FBN Bank on improved terms, including an improved interest rate of Libor+6.5%, with a four month capital repayment holiday and longer repayment tenure of 36 months improving 2013 working capital by approximately $12 million. The following updates, with the shares currently trading more than 3% higher on the news at 16p…
AIM-listed gold producer from Tanzania, Shanta Gold (SHG) has announced second quarter of calendar 2013 gold production of 14,448 ounces, up from 11,888 ounces in the prior quarter, and that “phase two of the planned plant improvements has been successfully completed with the commissioning of the upgraded crushing circuit carried out in early July”. However, “as a result of the uncertainty of increasing the volume through the incinerator without further upgrades, the company expects to achieve the lower end of its previous guidance of 63,000 - 70,000 ounces for the full year”...
AIM-listed, Tanzania gold producer Shanta Gold (SHG) has announced it has “entered into forward sale contracts over an additional 9,000 ounces to be delivered during the period to March 2014. These forward sales were secured at an average price of $1,362 per ounce. The company now has in place total outstanding forward sales contracts over 30,000 ounces through to March 2014 at an average price of $1,398 per ounce”.
On Friday, AIM listed Shanta Gold (SHG) announced that director Jonathan Leslie had bought 2.3 million shares which brings his total holding to 15.44 million or 3.34% of the company. Even at the current low price of 12p this purchase is not immaterial. The company is now capitalised at £55.42 million and is just off 12 month lows (10.375p) and well off 12 month highs (34.5p).
The good news as far as technical analysts are concerned in terms of the charting set up at Shanta Gold is that it is very similar in structure to that at another precious metals play I looked at today: Arian Silver (AGQ). The bad news is that if anything, the outlook here is just as poor, or worse.
Post 6 directors of AIM-listed, Tanzania gold producer Shanta Gold (SHG) acquiring an aggregate of more than £185,000 worth of shares at 17.75p each last month I updated that, whilst there remained risks, there looked to be value in the shares but that current gold market sentiment was clearly not helpful and could still see the shares fall in the short-term.
Shares in AIM listed, Tanzania gold producer Shanta Gold (SHG) traded at more than 40p in February 2012 but have since been hit by a combination of a weakening gold price, poor sentiment towards its sector and what October-appointed CEO Mike Houston described as progress “hampered by funding constraints throughout much of 2012 and subsequent plant design weaknesses, which together resulted in startup delays and a production shortfall”.
It was not a good Autumn for AIM listed Shanta Gold (SHG) but the last two RNS statements from the company demonstrate that it is both soundly financed and that, at last, it is delivering operationally. The shares have always had clear latent value it is just that investors have had a number of (utterly valid) reasons for not believing. But the times they are a changing.
Good news today from AIM Listed gold miner Shanta Gold (SHG) – it confirms that it is on track to hit production targets both for the fourth quarter of calendar 2012 but, far more importantly, for calendar 2013 and that will make it a hugely undervalued cash cow. At 18.875p the shares could, in my view, easily double over the next year – even without a surge in the gold price, which I still expect, and here is why.
AIM listed gold producer Shanta Gold (SHG) has announced that it will today raise a minimum $30 million (£18.6 million) via an institutional placing. An accelerated book build will take place today so we do not know the price but I reckon that it will be in the range of17-18p. Yes private investors are being screwed and the share price movement in the days leading up to today stinks like a mackerel’s rectum but the shares, at 17.125p valuing Shanta at £54 million) are still very attractive for the long term investor. Here is why
AIM Listed gold producer Shanta (SHG) is in production and should be generating cash from its New Luika mine in Tanzania At June 30th it had $21 million in the kitty yet on October 5th it announced that it had secured a new $4 million loan facility from a director and was “in discussions with additional providers of working capital financing facilities to meet its short term working capital requirements during the ramp up phase of the New Luika Gold Mine.” What on earth is going on?
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