Rurelec: Yet further discounts for payment on the Bolivian Award to repay the Birdsong Loan (Is how I read it)

Rurelec PLC Update on Bolivian Award and Birdsong Loan

Third Party litigation funding has its risks as most would acknowledge. When a company tries to fund these matters on their own it creates a situation where even if 'partially positive' shareholders can be held over a barrel. Please see Oxus Plc and Churchill Mining for the differentials...The waiver of part of its award in exchange for prompt payment is disappointing but essential. The company has no choice in this matter due to the need for financing/funding and to pay the Birdsong liability. One hopes due to the substantial discount on the 'likely' returns being further discounted, Birdsong will not require any further premium on this funding. Over to Birdsong for the 'strong-arm' potential but one would assume some 'common-sense' prevailing.

One is unsure from the announcement is whether Rurelec are "only" forgoing the past dividends that should have been paid or whether its a mix of all the dividends and part of the award. Sadly, for those that held blindly to the listing, this does not bode well. I was short for a number of reasoning including the lack of disclosure in the conservative nature of the claim. 

For that reason, the company are likely to have near £3M in cash by my estimates post an award...without figures to hand, it's hard to work out the NAV, however 7 pence may seem a little high in the short-term. 

Atb Fraser

Morning Mumble: Tullow almost gifts its Ass(ets) to Faroe Petroleum (FPM) & SLP criticisms despite being a shareholder + a wise market to Ironveld.

Contributions via phone from Ian (put into English by Fraser): Faroe Petroleum (FPM) have, in my view acquired the North Sea Assets of Tullow Oil (TLW) cheap. It comes as no surprise with Tullow’s focus on Ghana, Ethiopia, Uganda and Kenya. People with a longer term memory will remember TLW acquired these from TLW for around $200M in 2005, albeit I think it was the ‘Christmas cheer of 2004’. The positive is, the structure of the deal is as a result of production milestones.  FPM appear in the market for further acquisitions, I wonder if they’ll surprise us before the slow period in the markets. The Schooner and Ketch acreage may just have significant upside. Its suffered in essence by Tullow’s need to focus resources elsewhere so what that space.

Staying with (H)OIL: A long-termer post the acquisition of the OML Interests has finally got back to where it should be with an offeror coming out of the woodwork. Heritage Oil Recommended All Cash Offer By Energy Investments Global Ltd (Tony Buckingham) (320p A Share). The deal is done and congratulations to certain parties for getting this ‘offer’ to the table without any noise to market in the past 7 weeks!

Back to sobriety now: Its been odd for me, I've been reviewing my news channels and information updates which are essential. Whilst withholding the criteria of the searches I use and, I noticed a flaw in them (or omission) in respect of Inmarsat (ISAT). Whereby, I had been informed of the own goal of Russia focussed satellite launches however couldn’t put the dots togethers. Alas, perhaps I cannot be everywhere but its nice to be kept abreast of developments.

Sylvania Platinum (SLP) Quarterlies are out today. Its an old wart of mine, albeit I should not be complaining on the trades and Ironveld divestment. Its rare for myself to full short a stock I own considerably long, however the managements inactions on the Group based costs and lack of willingness to put their own skin in the game clearly shows their views. One thing parties may not be aware of is the ‘nil cost’ options. This is not only bad practice in my opinion, more so, excludes them from investment by a variety of companies (mainly insurance co’s etc). So don’t hold your breath when it comes to investor days, a lesson of old for myself. The results are pretty much as a result of the deteriorating rand, but I suspect SLP are not out of the woods yet. Perhaps holders will soon be asking the board to account for the such high admin and general expenses in light of the production model. Wonders will never cease..

With links to Sylvania (no position currently but have been long and short), and the recent share sale by the Chief Executive of 216,804 shares or circa £23K is somewhat of an indication of things to come; no wonder the SP lost all ofrms of support. Had the financing discussions been on track etc..and allowing for a CEO’s salary, one questions the need to sell stock…unless?

Sirius Minerals Plc Latest Crop Study Webcast is no surprise in itself, when first researching the company I'd just given up the day job & was trading/investing near full time I realised that research was key. Having found research into Polyhalite by various companies (Google will aid you), it comes as no surprise the encouraging results of the crop studies. The question still to be answered is what is the end user willing to pay for a new product? Time will tell, but certainly something to buy over the longer term?

Sadly I don’t’ have time to cover the International Personal Finance (IPF) Interims IMS or Globo or Wolf Minerals incessant seller...will it break the 16.3p?

Leggie, I’m sorry your cricket wasn’t up to par, sadly that’s what comes with following Nottingham :-).

Atb Fraser

Morning Mumble: Side thoughts of Iron Ore (GBP Vs. AUD)

As a side thought to the Iron Ore issues. Earnings and the like are likely to impact on the Australian Currency/Economy and be the most effected in the short-term by the Chinese measures on "Import Loan's and Leverage" in the commodities sector.

Amazingly, if the issues roll (excuse the pun) into the Mills with defaults, one wonders if the £1VsAU$1.85 will be tested. There has been a surprising lack of movement in the GBPvs.Aud even as the news comes to fore of the issues the FX shrugged off the negative to hold the needed $1.80. The Aussie dollar finally gave in to the real economics of the situation and retreated to $1.82...it would appear the Australian prime Minister is getting his wish!

Atb Fraser

Morning Mumble: BG Group & Iofina's 'half decent deal'...+Any old iron.

So the gossip mungers are stating that Exxon are in the UK Currently, I suspect they're in many places. I'm negative on the Exxon deal purely because I believe it's "more valuable" to other companies. One of those is BHP Billiton (BLT); they can afford BG Group, and perhaps "some" shareholders have already given some form of indicative welcome to a share plus cash merger between BLT & BG. 

It’s quite ironic really when you look at the assets of BG, most are admittedly for the future, but what more does an investor want apart from the obvious current cash flow. BG wrongly positioned itself so earnings are jam tomorrow, with declining Egyptian Revenues it doesn't bode well for the balance sheet. Sadly, the company will more than likely sell and divest its assets, weakening the longer-term earnings of the company. It makes one wonder why they developed the Curtis LNG platform (Aussie Asset) to sell it before 'cream' benefits the company. One awaits the developments of next month for a clearer indication. 

Iofina, "reduction" in head count is a welcome sign of the seriousness of the issues facing the company. One can't help but wonder if its blame the new guy formula won’t work either but only time will tell, at least they'll walk with 6 months’ salary in their back pocket. The RNS acknowledges they have offered to be consultants, however the company doesn't go as far to say whether they're taking them up on that offer. 

Hot on the heels of the "headcount savings", Iofina announce a Bond Issuance which an equity kick to it, albeit at a premium to the current SP and various other elements. The cash raised will keep the company afloat through 2014, and with any luck to the water permit approval which I personally believe has more chance of being beneficial to the company than the Iodine. There is an anomaly between what investors have been doing and what the company have done. It’s clear to say the expectations have been greater than the reality. Perhaps some mugs giving abuse for shorters would like to give a coherent discussion about why the company is so undervalued. I still maintain, why didn't you sell at £2+, it's not hindsight contrary to popular belief it's "common-sense Vs. Greed". 

Over to Russia, with Petropavlovsk Plc with their final results. If you think back to their interims there was a $500+M (I think nearer 600$M) write down which made sense. Allowing for exceptionals it’s clear the company's cost savings are at least on paper having a positive in terms of the Costs per Ounce. The company rightly highlights the debt reduction of $115M, in part by a shrewd entry to their bond market to buy up debt at a discount. The group has one thing hanging over its head, well more than one, being a Russian Operator, having debt (convertible bonds of $310M) to refinance by February 2015. Personally I can't see the attraction there, not from a western standpoint, albeit I am reliably informed that there are willing participants for an equity raising. Common-sense states its either Russian or Asia/Chinese investors that will assist POG. With covenant issues and the need for $310M the ICBC (Russian) has no choice but to be 'welcoming' to the positives of the company. 

For the RSA (Republic of South Africa) followers, Aquarius Platinum (AQP) one would be wise not to forget the issues and the amount of capital this company has needed over the past 3+ years just to obtain  the results to today. An item of interest for which has been a trading indicator for me, is the "lack of price movement" that AQP comments on despite more than 50% of the supply being removed from the market. Not only are parties becoming wiser to buying the commodity but more so, I suspect there's some blame to put at the ETF's including RSA's physicals that have stagnated the market by novice traders. One would have expected a 15% increase had the industry and their traders not been mothballed. Likewise, one cannot ignore the surpluses, even allowing for amateur PGM's traders, one cannot help but wonder if revisiting the "surplus" stock guidance would be prudent. With the three major producers and stocks dwindling, RSA Miners would be doing the industry a favour if they stayed on strike for 3 more months. 

Something that was coming across in news was "the apparent" news of China cutting down on Import Loans (See FT Article: China plans crackdown on iron ore import loans By Lucy Hornby in Beijing. Its somewhat amusing that the Government were pushing these only two years but now they don't like it. More to the point, as I commented on awhile back, the Government is trying to avoid the house of cards on large scale. So Shanxi Haixin Iron and Steel Group Co (not so insignificant) has now fully defaulted, we knew this in March, but of significance is the whether the Government allow this company to fully default. The monies are owed more to banks than to "retail punters". 

China have a significant overlap of debt, with suppliers lending monies to the steel mills and local companies "customers" also lending money. In essence, a triangulation of debt if one can picture it, if one goes they all go (well most). China has one choice here, 'refinance and roll up the steel mills debts' in such a convenient way Companies can almost 'tipp-ex' them off their balance sheets or 'muck up their growth targets significantly. Most figures estimate that the Chinese Steel Mills have between $210-250B of debt. My view is, $630-750B is at risk on a basic multiplier of debt due to the triangulation principles, so the Chinese have no choice but to "step in with the Shanxi Haixin et Al's debt problems...time will tell. 

The Chinese traders leveraged to the hilt on Iron Ore would be wise to ask for a little more money to shore up their positions as they unwind. With Iron Ore at Port increasing to near record levels, I suspect the issue isn't the slowdown in the mills at such drastic levels but the "bank and/or funders requirements" for payments before releasing the ore. Something missed by most commentary is the "bond" type delivery system and showing a lack of understanding on the market generally. BLT & RIO mirrored the iron ore issues, one wonders if it will not be too long before an overexposed supplier/trader of iron ore reports a significant default. 

Morning Mumble: Extraordinarily suspicious...Par Deux The LGO Funding

Its a rarity for me to be able to research and plan on Saturdays , however gin does improve this. My daughter is currently running around singing "dum dum dum deee blum blum dum dum dub dub dub." Whether she means me or not is another matter! 

When looking at Leni Oil & Gas (LGO) it was with no surprise whatsoever that a placing was afoot and lo and behold, Friday at 18:19GMT what came out. The RNS announcing the Funding and New Trinidad producing fields review. Now I know there's many ways to skin a cat, but shareholders have finally paid for the legal action via dilution, fund raising or whatever you want to call it. Of course it could be viewed:

"These funds will be used to assess a number of potentially attractive producing oil fields in Trinidad, which have recently been made available to the Company, and to ensure sufficient working capital is available as we embark on the next expansion phase at Goudron. LGO intends to spud the first of 30 new development wells on the Goudron Field in Trinidad in the next few days."

Neil Ritson goes on to state..."As we embark on the largest development drilling campaign in the Company's history management are keen to ensure that the Company is well funded, and the right balance is struck with existing short term borrowing arrangements."

So LGO had costs likely to be nearer £2M for the legal action and I am being conservative there. So with a further £1.3M post expenses (my estimates), £900K of that will be shortly on its way to Mediterranean Oil & Gas. MOG your cheque will be shortly in the post, assuming there are not likely to be damages in addition to the costs. 

LGO Shareholders should take note, yes I'm long, but this has cost every shareholder a minimum of 10% of the market capitalisation in cash terms based on my estimates. The question is, whether it should have been brought in the first place. This will come to light, but its noted that certain parties have no interest in "making public the action" for reasons, it would appear only they know. So in reality the likely upside for shareholders was far outweighed by the downside...

This RNS should have in my opinion been entitled "placing to pay for [failed] legal action." In essence, had LGO not brought the case, the items this is "now going to pay for would have been funded? Perhaps someone has a different view? The timing of the RNS is duly noted...

Apologies, it's something of a small interest financially for me, but a major interest in terms of drama! So sorry for wasting the 3 mins it took you to read this...

Its quite surprising that my Partnership (PA.) and Just Retirement Group (JRG) have been so profitable. The recovery is already in progress and for those knife catchers reduction would be wise. Apols for not responding to an email D Gin took priority. 

Have a good weekend, Atb Fraser

Morning Mumble: Weekend'ish Edition & Challenging Read...a prize of insanity if you make it to the end!

Gone are the years where a JORC or drilling update were akin to a gusher in the Oil World. Quite a few small companies have come back with decent results recently, but the realities are common-sense. Two examples being TYM and IRON.

By looking at Tertiary Minerals (TYM) with the Maiden JORC Compliant Mineral Resource Estimate, there’s an evident problem. So the resource of 38.4 million tonnes grading 10.4% calcium fluoride (CaF₂) at their mine MB Fluorspar project in Nevada overall value.  The 38.4m/t’s is made up of 8.9 million tonnes grading 10.3% fluorspar (CaF₂) at 8% CaF₂ cut-off and JORC compliant Inferred Mineral Resource of 29.5 million tonnes grading 10.4% fluorspar (CaF₂) at 8% CaF₂ cut-off. Rather simple that part, 

So looking to the future TYM state they’re at the early stages of “metallurgical testwork” commencing on the drill samples with the aim of producing acid grade fluorspar. The Directors believe that further drilling will significantly increase the size of this initial Mineral Resource Estimate as well as upgrading most, if not all, of the Inferred Resource to the Indicated classification.

So after the JORC update, the company announce on Thursday 24^th April “The Directors of Tertiary Minerals note the recent downward share price movement following the positive announcement of its maiden JORC compliant Mineral Resource Estimate etc…etc..”

Well the reason is not just based on the “share appreciation” for TYM, but more so the fact they have a EFF (Equity Finance Facility). This is the reason I am short TYM, perhaps the Directors will realise the negative elements of these facilities. So not withstanding any positive news coming forward, the share price will stagnate and drop lower (slow spiral) helped on its merry way via the EFF and Equity Swap. TYM came to my trading attention when Darwin excised their warrants back in February/March. Don’t get me wrong it’s a good company, merely with the wrong funding in place in my opinion. So the excise of warrants, issue of shares and limited forward news in the interim everything is priced at the moment. So much so, I’d consider 7.5p to be the limit notwithstanding any news. Perhaps the company would be wise to raise at 7.5p say £8M based on the progress and consolidate (not the shares) the company’s position.

Then Ironveld announce the Publication of Definitive Feasibility Study. Yes it all looks good does it not (Copy & Paste from the announcement):

·     The Study confirms the Project's viability to deliver an exceptionally high grade iron product (99.5% Fe) called High Purity Iron ("HPI") which commands a premium to the pig iron price.

·     Vanadium and titanium slag containing commercial grades of vanadium and titanium will also be produced and sold.

·     Project life is in excess of 100 years and highly scalable.

·     Ore from the main magnetite layer on the Company's properties can be fed directly to the proposed smelter without the need for beneficiation

·     20MW of power available on site by year-end 2014 from an ESKOM substation adjacent to the Project area

·     Study shows the ability of the Project to deliver an annual turnover of GBP 26.4 million with an EBITDA of GBP 8.1 million per annum (based upon current costs and commodity values)

·     Project is also projected to be cash flow positive from the commencement of production

·     The capital expenditure is projected to be approximately GBP36 million, a proportion of which will be funded out of early cash flow from the Project

·     The robust nature of the Project has attracted interest from a number of Capital providers,  the Company is in advanced discussions with banks, other financial institutions and industry who are interested in providing the necessary capital as part of capital equipment and/or offtake agreements for  the Project's HPI, vanadium and titanium.

So when looking at this and breaking down the detail IRON give don’t give any economic figures despite this being a “definitive feasibility study.” Perhaps someone can advise them that definitive includes financial details, but alas that’s no doubt saved for the “interested” parties despite being shareholder essential information.

So if we ignore the ESKOM issues which contradict the 20MW’s of power being available onsite by year end 2014 (December). A basic knowledge shows the ESKOM issues and please remember there’s a lot of strikes at the moment so reduced demand on ESKOM.

Ironveld state: “The capital expenditure is projected to be approximately GBP36 million, a proportion of which will be funded out of early cash flow from the ProjectA £36m 15 Megawatt (MW) Direct Current smelter will be capable of producing a little over 40,000 tonnes of High Purity pig Iron, 415 t of vanadium in slag and just over 8,000 t of TiO₂ in slag, per annum for up to 100 years from late 2015. “

At current prices, this is capable of generating £26.4m of revenues and £8.1m of Earnings Before Interest, Tax, Depreciation and Amortisation per annum. They state this is based on upon current costs and commodity values. So what are their figures, currently an average of £255 per tonne for Feb, March and April would be wise (£10.2M likely revenue) for Pig Iron, and the slag prices vary widely, but by apply 30% discount to market prices would seem reasonable. Vanadium is currently averaging £15.77p/kilo and TiO₂ not less than 90% at an average price of £2,204.62 a tonne ($1.65 a lb). So if you give a 20 year mine life, the IRR isn’t something to get excited about at current prices. Price rises have been far from accepted globally, maybe 19% if you’re bullish with the numbers and don’t forget the BEE (Black Ethnic Empowerment)…at 26% reduces that further to some 13%?

So a thought for those still awake, with the price rising it was rude not to take a short interest. I received stock via slp for the divestment which I threw out at a significant premium and maintained a short. Now with the numbers and absence of financial data, one cannot help but wonder if the price is over excited for the realities of the project? £1.4M plus loans won’t get them very far. So if one was to use a ‘best case scenario’ a mere 15% of costs are likely to be funded via cashflow for IRON the IRR is reducing further. Viable asset, but be aware of the realities rather than the expectations.

Atb Fraser

  

Morning Mumble: LGO's common-sense, Court Transcripts...& blaming the Chinese

I'll get to the mining section and Anglo's clear attempts to start the 'sales process for the wonderful platinum assets' that guidance is reduced a mere 7-10% pending which way you turn your screen. They do add the 'caveat' that his guidance for production may change. Sorry to say, but if that strike continues the guidance will reduce exponentially as feedstock is massively reduced. If AAL could get rid of the crap they'd be laughing...

First and foremost was the categorical and absolute events announced by  Leni Oil & Gas Update, whom omitted to point out their first appeal had been refused. As per Mediterean Oil & Gas's announcement that LGO strangely forgot to mention 'when they were considering an appeal' that the first appeal attempt had been refused...3-0 MOG, and perhaps even some compensation as well save for LGO being wise to agree not to appeal on the basis no further monies are sort? Surely common-sense?

For clarity, I have some spreadbet's Longs in LGO, purely based on Trindad and for no other reason, there was not an investment case in my view without this. Albeit long-term shareholders will now be some 75% underwater. Its makes for an interesting read if you compare the production rates of Spain with the 'revenue's and the correlate that with the price of oil at the time, or say 3 months after from 2008 onwards. Either way, its no wonder there were issues with the sale.

So on to the title, I am led to believe by Ian has done what he said in terms of contributing and applied for the court transcripts for LGO. So Ian you're now formerly compelled to get your arse into gear and produce an Eastender's worthy edition. We have a bet of a case of Hendricks or a Case of Bolly on whether he does or does not, either way, I'll be happy! This is not for an investment case more some drama, we all love a bit of drama, albeit I'm led to believe they're not pretty for certain individuals. 

Kenmare Resources gave an Interim Management Statement update to day, and it's 'not as bad as expected' (depending on whom you read), but certainly not worth a rush to buy "yet." Things appear more bullish and they're actually selling what they mine / produce, I can hear the cheers already. Perhaps the Iofina holders may realise that when producing something sales are essential, their current cash situation implies they are not selling at a viable rate that covers the costs/interest payments. (I'll perhaps cover the rumours in due course.) 

So, as the Broker's point out and I eluded to awhile back, one would be wise to await the figures from Tronox. There's a strong argument for some higher risks monies in Kenmare now and maybe increasing as the news flow proves more beneficial to their set up. So for the first time in years, I'm not negative on Kenmare, but the moaners and misguided risk assessors best wait for a better headwind in the sector. 

Now Centamin Egypt's market update appears that all their problems are solved. Now from a common-sense perspective, if the powers at be have stopped parties being able to challenge Government Contracts/Licenses etc in this way, what other means are there? My concern for CEY is that this problem won't just disappear but turn into a different issue, alas the company is doing well, and at 61 pence ish, longer term it might just bode well for the "long-only" brigade...why you didn' buy in the 30's 40's I'll never know.

The Chinese Government are getting involved in the Commodities prices. I'm starting to sound like my In Laws in America that blame the Chinese for everything, however this is more noteworthy rather than whom shot who! The Chinese Government are in essence buying bonded commodities, whether they're being tipped out the back door at a "small loss" is to be seen but one would imagine so with the amount of "second hand fire sales around at the moment." 

Nickel and Copper reacted positively to Reuters news flow (albeit it has been known for some time). What parties should note is, with more of this 'transparency' around the stockpiling, it does bode well for the longer term. So, in the interim and the Chinese action, it would be wise to have some longs in Commodities such as Copper and Nickel, as China attempts to allegedly take advantage of lower prices; the question for me is, when they have never informed the market of much before why tell them now? Could it be to stave of a house of cards for the Chinese Banks promoted to provide finance via security of "Copper etc..." (aka the bonded element? Some very good trades in copper coming up for those inclined to do the obvious...

With Facebook and Apple, for the first time I took a conviction to long both stocks, most in part due to how facebook use is transforming and how Apple's figures were underpinned by Arm. Quite surprised, but I would not say I'm fully conversant with playing with the big boys! 

Finally, adding a caveat of "BS", its rumoured that IOF are considering a delisting to sort the issues out, raise funds via the larger shareholders and come back with water permitting and the like sorted. In reality it would make common-sense, assuming one has significant enough backers to get the situation resolved quickly. Perhaps even start selling inventory? 

Atb Fraser

Morning Mumble: IOFina Plc & Chinese Stimulus coming...

Good Morning, for those that had Easter off or celebrated just the fact its the weekend pending on country location, I trust you're frefreshed for the slot through until the end of May. For quite some time now, I've reduced my trading activity coming into May, normally focussing on around 8 stocks instead of the wider coverage. 

Iofina came through with the news that should have been factored in as an element of risk by shareholders. Iofina PLC Production Update 23rd April 2014 if you read through the numbers and market expectations there was no way the production could be maintained at the previous guidance, nevermind no mention of sales. However one can pull apart the RNS today to show that there have been limited sales on any front if "cash is limited to £2.3M." Their stock levels must be around $37M so, I'm curious how a production unit can remain profitable if the sales are not being concluded. 

Don't get me wrong, I had high hopes for Iofina but at the peek any one that didn't take some off the table needs a chat with themselves. This isn't to rub it in, but what more was one expecting in the short/medium or long-term. Alas the cash conservation starts today, which is a positive in some regards as they're not increasing their stock levels. One wonders if you're building inventory and not selling why one would be producing? Perhaps its too many things I do not understand. So the bulls will be citing the time is right to top up...they aren't far off however the risks are increasing and the cash requirements are also likely to need replenishing sooner, I suspect within 4 months, maybe 6 months. One wonders whether it'll be "an open offer" to keep all parties happy. 

So Chinese Data is consistently deteriorating in manufacturing, I'll enclose the Reuters link so people can drool at the Rover 25 I think it was known as over here being manufactured. So if we stick with the facts, the Chinese Government wants a more realistic economy, allowing 'specific' defaults and buy 'assets' from companies to assist with them meeting their obligations/liabilities. They're also made clear statements about "not increasing any stimulus." So consider that based on the data and "slow down" coming out of China, reflected in part by the commodities prices, the Chinese are heading towards stimulus or slow down, take your pick. I'd personally be better on the former as they've yet again managed to amass yet higher foreign currency reserved, nearing $4B. People ask how? Yet they're always on the look out for the cheaper price...so manufacturing goes East with the Currency.

Going wider to Miners, Anglo would be wise to up their efforts to get shot of the platinum 'assets'...

Will complete when I have time, but would be wise to consider the issues with Highland Gold including the main shareholder.

Morning Mumble: I CU all the way...BLT pushing with expansion, and CAML hitting the mark!

Am I missing something with AIM? Admittedly it makes no difference to me, but what are companies doing awarding themselves 4%+ of the company based on??? Tower Resources PLC Grant of Options and Exercise of Warrants Only 75M shares at the placing price from Tower Resources PLC Placing, Acquisition and Preliminary Results from the week before. Where else in the world can you get the ability to buy stock at last week’s prices? It would appear the board room of Tower Resources is one of those places! 

The company wants to be very careful, as its these sort of things shareholders are looking at. Imagine if the placees were told...we've got a brilliant company that needs cash, are you interested? Were they at any stage informed that a significant percentage of those monies would be diluted to award "options." to Directors. The event is so material of the mind-set of the company parties would be wise to flip the stock and go elsewhere.

So back to the markets: BHP Billiton's results  are obviously bullish with the 10% headline increase in production. 

So the race is on to force companies out of the market place not only with Iron Ore but Coal as well, with an additional 2Mt's hitting the market despite it being so dire. The fittest companies will survive, but certainly not those overwhelmed with debt. Copper increasing and I suspect revised guidance upwards is on its way with expansion plans. With RIO and BLT's dividend one would be wise to hold them in a long portfolio. 

BLT's news bodes well for RIO (as they weren't as bullish as BLT in their announcement yesterday). In addition to the news from Mongolia that things are progressing at Rio’s Turquoise Hill Says Parties to Seek OT Funding Extension is the Government finally giving clarity on Royalty, Taxes and the like. Turquoise can then be taken out by Rio, the 1700 workers reemployed and everyone's happy in the bliss that is Oyu Tolgoi. We knew back in March that AMEC were advertising for workers, so one assumes this process is further along than the press realise?

We all must welcome Polypipe (PLP) to the market with Admission to Trading on the London Stock Exchange. Will the founders/PE backers run to the door quickly? A quick look over the market shoulder at the Appliance Online (AO.) share price is positive for me. Will they have to change their name to "Insurance Online?" 

So with Fresnillo and Hochschild's announcing yesterday would you be holding silver stocks long? We have Fresnillo coming out with production inline however its higher cost sector friend Hochschild's results yesterday don't elude to much in the way of any positives nor is there much commentary of the Silver Price down 20% on average over the last 12 months, costs will be key and HOC are now limited in their savings. 

HOC announced in March that their costs were around $18.6 per ounce and that was during a year of "savings/costs focus", with the current silver price not leaving much headroom and after the $27+M annualised interest costs on their Senior Notes, there's little left for shareholders. If you're in profit at HOC, you'd be wise to sell up or switch to FRES with costs around the $5.6 per ounce all in, significantly better than HOC. 

Now who'd have thought Tesco would have been cooking on gas today? Would you have been short going into results final results. Tesco have some relief, but it takes no rocket science to realise the three companies have to transform their pricing perception and offerings in light of significant competition. Asda clearly are winning, albeit all appear to be losing between 4-6% of their turnover to the lower priced offerings of Aldi and Lidl. 

The final thought for the day goes to Central Asian Metals 2013 Full Year Results, with 100% of the Kounrad Copper Mine income being attributable from now going forth, the earnings are set to benefit further. With 9 pence per share final dividend, there are not many around AIM doing what they say! The costs per pound are spot on, albeit I see some increase in these going forward at around 5%, the dividend coverage is more than affordable. Currently in at a fully inclusive cost in Kazakhstan is $1.13/lb albeit last year was $0.98/lb (2012).

Atb Fraser

Morning Mumble: Las Bambas (Valuation) really?

The bulls (Glencore) are no doubt celebrating with the $5.8 billion valuation (GLEN Announcement PDF) . More fool the parties when the 450K tonnes per annum comes on stream. For some strange reason it reminded me of a dire film I watched in Cuba awhile back called La Bamba. So GLEN are going to create some cheer with an alleged return to shareholders...personally with what they need to get into production/improve, the shareholders should come in second place to the cash.

The GLEN Oil deal, albeit positive is towards the top end of premiumds, Glencore to buy Chad oil firm Caracal for 800 million pounds. No one Caracal paid a break fee to end the proposed merger with Canada's TransGlobe Energy Corporation. There won't be much left in the kitty for shareholders, so envisage a near $350M special dividend for GLEN holders to keep them happy (which they need).

So yesterday, I was sat down working out the metrics of the Las Bambas deal and got side tracked with a trip to a theme park, so never ended it. Thankfully my time was prudently spent and lo and behold, this morning, Mines Online came forward with the metrics and comparisons in an email today. It's significant ahead of large scale mining prices, just look at what Rio achieved with Palabora!

MinesOnline.com Analysis of Glencore Xstrata's Sale of the Las Bambas Copper Project

Leggie, you mention Providence Resources and the speculation about a Farm In/Out deal, there's been rumblings for some time of a very "positive" news item coming forward, perhaps even with the interested parties acquisition of Lansdowne Oil & Gas Plc? Who knows, but time will tell! It would appear the chatter in the market is very similar to yours as well Leggie! All betting on the big buxs:-)

EMED is being hammered at the moment and I suspect the company and advisors have missed the point for why. The news items that they anticipated as drivers were immaterial to the share price. The company caused this with their willingness to place at lower prices etc...Yes, as a trader, its something I look for, in terms of the psychology in the stock. Remember you have to "buy" to short and sell to long...I hope that makes sense. There is no other reason for this, the placees now being locked in with the market and buyers unwilling to take stock at much of a premium to the placing. One could argue the news meant the market has no faith now in the risks of placings...a lesson for many a company. 

Its nice to see Ocado coming to a real 'value' in the market and I suspect will be my best trade of 2014 and we're only 4 months in. ASC (ASOS) being pushed as value by every man and his dog. Really in a risk off (myopic) view, it's not likely to have a staggering run based on fundamentals. 

I need to refresh my views on Rio Tinto delivery of "strong first quarter production", One assumes they knew the comparison to the previous quarter would not look good? Nor will it look that good for Kenmare as Titanium dioxide feedstock had softer market demand. They don't wish to rebuild one of their furnaces until the market improves. If tenders have been completed for the Rio Tinto Fer et Titane (RTFT) furnaces, one hopes the companies involved have other works on and may have to revisit their pricing as it'll be some time away as they're waiting for an improvement in the market. Albeit Anglo Pacific can sit there happy in the knowledge there was nothing unscheduled in the rainfall etc...

A thought for companies...one would be wise not to utilise the term  "pleased to draw down funds" (Tertiary Minerals RNS). 

Atb Fraser

Morning Mumble: Appliance Online (AO) what next? A short piece...and the week.

For those following the story of Appliance Online, it listed at a massive valuation compared to its profit from the previous year. Appliance Online do just that...white goods and small appliances only. Well my figures do not stack up on that valuation and it comes as no surprise, having modelled the company, that is the reason why I am short. 

The important part that needs to be considered is the expanding offerings from AO. AO, with the "marketing concept" and heavy push means they have to start offering other electrical items within 5 weeks to keep the psychology of the model moving forward. This needs to be continued, almost akin to "Shake and Vac" marketing, for those that know about that advertising benefits of that brand that had astronomical results when advertised at regular intervals...

Its likely within this new offering of TV's that Appliance Online will sell a unique brand as well; say from a company that already produces components and parts for larger and well known manufacturers such as Samsung and Panasonic. So I envisage AO offering a new line called HiSense or similar. They're already selling under that brand in the US and a limited degree in the UK, but I expect them to do some form of quality launch with exclusivity for AO.com leveraging off the back of manufacturing parts for other more well-known companies. 

Whatever appliance online do, in the short-to-mid-term it won't justify the stupid valuation it currently has. Profits are a must and it's not just "about cashflow", shareholders want more, or at least should. It will be interesting to see if the psychology of the AO model means the launch will happen within the 5 week window to keep "the news beat consistent" and maintain people's interest. Only time will tell, but due to the nature of the market, its my a risk I have to factor into the shorts. 

The concept, of warranties must underpin AO more so than any other brand. A dishwasher has a "lifetime warranty" for only £6.95 a month for Dishwashers... that's  £83.40 a year. It's a lifetime warranty so when you cancel you cannot renew it (fear) but more importantly with the average white goods costs being around 450 you're paying for a new one every five years ish. Interesting concept, buy one pay for two just in case on breaks down/has a fault. I won't debate the statutory rights a customer has under the Sale of Goods Act here, but you get the idea. So for now I remain short...but am wary of news so will be looking to close down at points prior to my five week deadline. 

To elaborate further on Friday's commentary, its rumoured there is going to be an APR Energy and Aggreko tie up (I'd give it the caveat of a significant BS Rating). Some, including myself, cannot see the benefits save for the additional savings in one set of group costs. Would the brands be able to hold their share as one entity? Hmmm...A lot of gossip at the moment but time will tell, the main difference could be that APR use gas and Aggreko's main set uses oil a positive when combined in terms of offerings. 

For the shorters than don't just focus myopically on one area it should have been a very good week, in fact exceptional and some stocks benefiting from parties buying back (closing their shorts). There's a renewed negativity in the market that for some strange reason a lot of funds have started to reduce their risks exposure on a very predictable format but as a herd; the outcome is obvious is it not? The question is, what took them so long to realise? Perhaps someone can enlighten me on the situation, but the situation does not look good for the longs, save for the rumblings of MRW being taken private. 

Atb Fraser

Morning Mumble (with apologies): Uranium, will it have a head wind? & Oil...

Japan approves energy plan reinstating nuclear power (Reuters)

Very interesting news from Japan, something which will assist with the recovery of the Uranium Price. The difference being, it's going to only assist with volumes for the forseeable future with a little price recovery. Obviously this depends on the speculators that may rush in but with most being torched as they speculated at $40/lb then $35, do they have it in them again? One would do well to avoid positions until there is greater support in the market!

Its nice to see the gloves being taken off and certain actions being made public: Mediterranean Oil & Gas Plc Litigation Update: Receipt of Initial £600,000 of Costs from LGO. Shareholders would be wise to get hold of the transcripts in readiness for the LGO AGM or EGM if parties are likely to take issue with the matter. £1.5M is not a paltry amount and cost the company significantly. There would have been wisdom to ask for disclosure before running to tort/legal actions especially that were so significant in the allegation. This however, I do believe is not the first time either. 

I see Baobab Resources have pushed the positives forward...BAO’s CSIRO Pyrometallurgical Testwork Update. Looks like there is quality in the asset now and with sufficient funds to complete the Definitive Feasibility Study. With by products (credits) it looks a goer, the question for most will be 'longer term funding for development.' On the flip side, having held Ironveld (IRON) BAO are certainly offering better prospects including being closer to development. 

Yesterday it was surprising there was not more coverage of the potential delisting of Russian Miners such as Polyus Gold, Polymetal and steelmaker Evraz. Evraz won't be missed in my view but sadly with its results and determination to pay a 6c dividend it'll be with us for longer than the former Co's. With a number of companies including in the FTSE Gold Mining Index, the future doesn't look to chirpy! Apart from the gossip surrounding a number of companies considering a delisting/relisting elsewhere, including oilers there's certainly now a risk. 

Roger Bade's commentary suggests that Chelyabinsk Zinc (CHZN), Magnitogorsk (MMK), Norilsk Nickel (MNOD), Phos Agro (PHOR), Polymetal International (POLY) and Uralkali (URKA) are obvious ones to follow, although Polymetal is a UK PLC. Highland Gold (HGM), Nord Gold (NORD) and Petropavlovsk (POG). Personally, having had my fill (short) none of them will be missed, a wide berth would save some investors the pain!

The diamond market appears to be stronger than most thought, Diamond Banks Rein in Lending as Gem Speculation Drives Prices. Will the prices continue into the next sales? Time will tell but perhaps investors would be wise not to consider too much headwind in the sector as a result of "the fuel being reduced."

Something surprising was the lack of commentary regarding Faroe Petroleum (FPM). Regulatory News for FPM. FPM appears to be progressing. It's a stock that for reason reasons parties took side step (See Share Society's Press Release below. A number of items were valid but clearly value is looking more than likely...a positive result that can be tied in with other production totally under the radar. 

ShareSoc Press023 Faroe Petroleum

With the weekend upon us, I shall be working...

Leggie, are you recovered? Atb Fraser

Morning Mumble: Apart from the reactive commentary about Copper, the shuttle has landed (GKP) & Trap (hoping to take-off)

The copper stories are interesting, for which I shall get round to penning my thoughts (subject to time). The basis of it is, everyone's expanding and demand is not. Where have we heard that before? Strange isn't it that reporters have to wait until it's staring them in the face before acknowledging the obvious. One would have hoped they could have worked out with the expansion of Chile's production by 2mt's that others would "not be reducing." Alas, with everyone on the fence, no wonder companies make so much monies from people long/shorting (cfd or spread betting) as they appear to be the lambs to slaughter (hiding my soapbox). 

The amount of distressed copper being traded gives an indication copper is likely to trade around $2.65-2.85/lb for the forseeable future, with higher point demand perhaps peaking at $3.15-3.30lb, so presents some significant trading ops for those like-minded folks. In essence when you compare this with Iron Ore, Steel and the like there's a squall ensuing for most commodities, save for Zinc and Nickel? Supercycle? Super Supply...

Speaking of which, with no surprise whatsoever the Bond/debtholders of Rusal have agreed to take no action for 3 months. Well it would have made no difference, so better to be seen as obliging than problematic with the situation. One question for these holders is, why would you in the first place? These defaults were not a sudden surprise, they were coming with a guarantee or no money back small print assured. When will debt funders wise up to this? I suspect the time will be never...with fees attached. 

Speaking of fees, you could argue at 4% ($10M) fee, Gulf Keystone's 13% US$250 million debt financing + 40M warrants for Gulf Keystone was a good deal. This now presents an opportunity to market the company which also presents as an opportunity to short the stock post marketing? So with some sudden relief in the market, GKP only needs 32$m a year.

Staying with oil, Trap appear to be promoting the virtues of the company.... Tower Resources PLC Placing at 3.5p, Acquisition of Rift Petroleum with Preliminary Results (saving cash on RNS's as well! What next a director change?). With confetti hitting the market, one would be wise to wait for settlement! It would however appear to be a very shrewd move for risk/reward exposure, especially for those that sold higher! One wonders if a similar namesake TRAP will start producing some decent news flow as well.

Atb Fraser

Morning Mumble: Caledonian Mining Corporation (CMCL) & common sense.

Caledonia Declares Second Quarterly Dividend which is exactly what it said it would do...this does not mean it removes the risks presented with the Gold Sales agreement to a Government smelter as one day one assumes they can delay payment in Zimbabwean style whenever they feel like it. The plus is, they're generating cash and making a profit...nearly unheard of on AIM!

Its rather amusing ready the suitors for the worst leveraged gold play Albemarle & Bond's. Its almost like they knew what was happening with the company and they're following the story through to its conclusion. Not one analyst or journalist looked at the structure of the company and realised it should have been the largest value short of 2014. This type of reactive journalist does not bode well for the independent investors or shows that the analysts are willing to take a negative view rather than a mere 'sell.' Perhaps there's an etiquette in "sell means crap" but I doubt it.

Aquarius Platinum's Tender Offer & Proposed Rights Issue makes me think that the knife catchers will be hoping for a recovery in sector. One cannot help but wonder with the previous managements fundraisers "for exapnsion" and to reduce costs, which ironically ended up being mainly CAPEX whether it's good money after bad...

The final thought of the day goes to a delay in IPO's and the coke fuelled frenzy that has happened...IT companies being rerated, one assumes after they've taken their own monies off the table but call me sceptical on that. The Market is becoming very logical but for some reason the market ignores the common-sense. With the Longs on GKP significantly increasing will there be an opportunity to short it again? One assumes the "market" knows more of the terms than the gossip I have heard of 7% coupon and 45M warrants at a £1 being thrown in?

Atb Fraser

Kromek (KMK) the Directors putting their toe in...

Leggie, something I've been following and the directors are keen to buy in. One of the twin plays is the Amphion (AMP), where the company holds 11.6% of the stock. Richard Morgan, Chairman of the Company, puts his toe in for 40K stock today... one didn't waste much time in notifying the market from 10:35 this morning to RNS before last notice. Something the market may acknowledge tomorrow tomorrow...

The Company is new to market, but at least is following best practice if they believe in the company etc..

Atb Fraser

Morning Mumble: A Slog: but consider the other indicators on Ilmenite & Zinc

ZinCox Plc Open Offer to raise up to approximately £3.93 million

Today's is a slog but its something that needed to be considered...in terms of thought processes and risks.

ZinCox should be doing well with the price of Zinc etc...but this company's share price says a little more of story. The last fundraising you're thinking was "yonks" ago...A quick glance at the records shows a contradictory story: 12th November 2013 Proposed fundraising through the Subscription by the International Finance Corporation, Placing and Open Offer. An oversight? Perhaps miscalculated the financial needs when doing a placing only 4-5 months previously? The Directors have experience of this? Oh well time will tell, after all they've entered into another agreement for similar 'recycling plant' in Russia.

Obviously there needs to be a share incentive plan here and its always surprising to look at the wording of the incentive plan. Its no coincidence that the incentive plans are significantly ahead of the current share price. It looks a lot better does it not if when selling "another placing" that one can say..."look we're so confidence of the company's future our options are nearly double the current share price." Nor was the share price movement and subsequent decline a coincidence in light of the news being announced. Would it be a coincidence that financing was "maybe" discussed near the end of March and the subsequent decline by 50% was evidenced?

One hopes ZinCox will be producing sufficient and in profit before their Korean Recycling Plant rent kicks in or will there 'be a need for an extension of the rent free period?' The price shall appreciate in value but not for long if another equity raising is required maybe in November? So will perhaps present some trading opportunities in the mean time...Perhaps someone can correct me on whether its the C or O that is capitalised?

Caledonia Mining Crp Q1 2014 Production Update which was 10,607 ounces of gold were produced during Q1 2014 and was lower than Q4's 2013 at 11,429 production. The company states it will be paying "closer attention" to grade control in future (so nice of them)...I will be very surprised if they hit the targeted gold production for the full year but this should not impact on the dividend coverage with an announcement due 30th April an approximate yield of 8% based on 6 Canadian cents over the year.

Now as Sierra Rutile announces Q1 2014 Operational Update one assumes the positive will start to read across to Kenmare? Yes, previous discussion on Kenmare (KMR) (Ken's Mare) showed itdoes not have a positive track record but Sierra Rutile’s results may read across as a positive for Kenmare. If SRX’s sales, which were higher than production (a positive for once), then perhaps Kenmare would be likely to benefit as well? Remember Rutile is the premium end of the pigments and ilmenite the lower quality cousin. There’s two possibilities here, one being that Rutile (Premium Ore) is replacing its lower quality cousin (contra play) or both offerings are set for an improvement on demand (dual play).

Remember, ilmenite can have the titanium oxide upgraded to make a synthetic rutile however the quality is often inferior. One would be wise to keep an eye on Iluka Resources (ASX: ILU), Mineral Deposits (ASX: MDL)  (only started producing/mining at Grande Côte two weeks ago), Base Resources (ASX & AIM listed) (Kwale Operations & Quarterly Activities Report – March 2014 ) and World Titanium  (ASX: WTR) (Development Stage Project on the ASX. Remember it was only this time last year that Iluka (ASX) and Tronox (NYSE) became bullish in terms of enquiries and reported an improvement but not much of that mirrored bottom line. It would be prudent to wait for evidence of a wider industry improvement when Tronox release their Q1 2014 results, expected in June 2014 which may or may not bode well for Kenmare. Sierra Rutile will certainly benefit in the short—term from the news.

Finally, Armadale Capital Plc's Strong Financial Returns Demonstrated from Mpokoto Scoping Study. If you like a rollercoaster of depreciating returns, I’ve followed this for the predictable outcome I envisaged in 2009 when it was formerly known as Watermark Global and would clean up Acid Mine Drainage in South Africa…alas has a shareholder ever made monies here?

Crimea impacting on Gas Prices, or is it the Ukraine? Russia really is the law unto themselves with an abundance of Natural Resources, I do not see what the issue was in terms of Crimea "voting by a significant majority" to go back to Mother Russia? Or is the Scottish Majority vote whichever way it goes (I assume independence) going to be declared illegal based on the majority voting? Wonders will never cease.

For the Grand National followers you'll be pleased to ride any of the horses I followed on a Beach Near you for a 5 minute ride!

All the best, Fraser

Morning Mumble Par Deux: the lack of news & financing.

Well it would appear the juniors are finally looking at cost savings. Medusa has been plagued with issues and as such the delisting won't help the stock in the short-term either. Intended Delisting and Cancellation of Securities from the London Stock Exchange on the 22 May 2014 . I wonder how the placees from October 2013 feel after the successful completion of placement and increase in size to a $34 million? Well the price will be under pressure till then for parties that don't want to convert their holdings into Aussie Dollars. Albeit not at a bad price/exchange rate.

Kromek Group PLC New Contract Signed in Medical Imaging Market seems they're getting on with the future revenues despite market reactions. Leggie, I note you commentary and only came across KMK when it tanked and hit lows last week. The company's revenues are far from transparent with the announcement on the 28 March 2014 with a trading statement that is significantly below forecasts. As such today will provide support for the stock based on the headline figures. The Tech is quite exciting and its clear companies are starting to view it/rate it, a shame the management were perhaps less bullish on IPO'ing in October 2013. Over-expectation is a recipe for disaster. 

Going back to solar wafers and the commentary about Pure Wafer, the recent director sale should be noted & as such despite reducing significantly higher I am now selling all. Whatever the garb when a director sells it should be acknowledged.

Could someone advise if its an over-expectation that Vedanta apparently ignore most market communication needs. Having heard from a third party, Vedanta appear to have not thought to advise the market of a significant change in guidance for their Western Cluster Mine. Perhaps common-sense prevails they're seeing slack in the market and as such don't really want to be expanding to 20+Million Tonnes by 2017? With capex at $2B they'd be wise to delay nevermind the logistic issues. Are the issues are unimportant to the market if one has to rely on the Washington Post: Billionaire Agarwal Said to Cut Iron Ore Project in Liberia Rajesh Kumar Singh and Abhishek Shanker Apr 04, 2014 for corporate news. More importantly, wouldn't this make the previous buys a related party transaction during a closed period? Seeing as the news is errrr....so recently after buys. Not to worry, I am sure there's only 5% out there with any interest in VED in the UK. So as expected the stock ticks up, totally immaterial to the market and the company.

Continuing with the theme of no corporate news, yesterday at lunch Reuters reports that Glencore are cutting their debt costs: Glencore Xstrata to cut loan costs with $15 bln refinancing-sources One would assume the differential 2.5B$ will be coming from the Las Bambas post April 5th, it's either shortly after the UK Tax year, never or post Swiss December 31st Y/E. Obviously its so insignificant, we'll hear about the cost saving after the event. 

Plenty of phosphate deals coming through, is the bottom in sight? With the Chinese Deals giving some views of future demand, it could be in for a very slow ride up. I wonder if Kier Group will benefit from Mosaic's news? Hmmm

A thought for the knife catchers: Is the slide on RusPetro over with the results: Preliminary Unaudited Results for the Year Ended 31 December 2013 Hmmm one can't help but wonder with the end of the interest deferrment coming to an end, is there enough left over for Shareholder Returns? Yet another company with Siberian (Russian) Assets. For me, the results are a point to close shorts and await some form of consolidation...is it likely? Finance is key and the ability to repay it is slightly significance. 

Atb Fraser

Morning Mumble: High Frequency Trading (HFT) & E E E E Eeeeeeeeeeeeee-nterprise

There's only so much one can bare in terms of HFT. Yes I am involved with it for trading Forex mainly the dollar but believe it or not, its not as profitable as physically trading. Computers are great as long as their variables are right. Admittedly they can trade faster than humans etc...but when it comes to common-sense a computer may predict a trend but having used such software its not for me. I prefer my gut and actions, perhaps I'm a control freak. Anyway, what's likely to happen is "until such time as the invesigation means its regulated" we're going to be bombarded with the negatives how it creates false markets. A market is false when there is only one offering? Did the world miss that offering from my GCSE class of 1987?

One thing I have noticed is the RNS list is the UK Investor Show RNS's. From a trading perspective I won't be going, I do not need personalities involved with a sales process/promotion to make decisions. I acknowledge that the Investor Show multifaceted  and is also about learning and its a positive to have events within the event comprising for discussions and the like (read as caveat emptor warnings) about the risks and also the dogs of the market. Something most would be prudent to take advantage of. The opportunity to meet companies was something I used to relish, but sadly I'm easy to be sold to face to face, so don't do it often. I'm now a Hermit of Traders, I no longer help lost causes save for Ian, but mainly refrain from meeting company because it means there's an Agenda a) for me to make money b) them to make money or be funded or c) Me not make money and them pay their bills. For myself it's a weekend I'm permitted 1hr stocks coverage as I don't work weekends much and am allowed the Weekender to read. I say allowed it's my own rules! That excludes the shorters meet-ups/booze ups, it is afterall a legitimate event where the negatives can exchange views. 

Yes its good to promote your wares as such, but the last thing I read is often the company presentation. There's a lot to get to before that and perhaps this is what investors and funds are missing. Those funds got caught wrong footed on ABM, GKP, TALV...and shall we say it, Connaught, Mouchel, Serco? G4S...to cover some in the FTSE. The logical items one needs to cover are being missed by the analysis, which has got so far away from bottom line and the like that the dross is even rising. Its an issue of mine, having had to take over my own pension due to the incompetence of a company whom had been told by me I wanted high risk, but when put to strict proof would not present the information. Long story, but suffice to say said company decide it was "in their interests" to pay up rather than deal with the logical consequences.

So we have a market, with Just Eat et al on forward earnings that are just stupid (for the moment). The reality is that utilising one platform may be well and good till companies click on "after exposure" that they will be known and can go it alone. Really, does one need to know what takeaway is available further than what they already do? Perhaps in the short-term when you can a half kicked around pizza from another merchandiser instead of Dominoes. What Dominoes is acknowledging though is the rapid expansion of it's E-business. Yes this in part validates Just Eat, Delivery Hero, there's actually more than you realise, with "onlinepizza" and HungryHorse. My concern is, in the e-cash society we are becoming is one not getting so far away from the actions that who's going to tip the delivery guy? Will he start taking contactless payments for his 5-20% prompt delivery. 

The positives are well known, and I concur that Just Eat will be akin to RightMove.Co.uk and is quite possibly going to be more successful than rightmove on the basis that there are no sufficiently large enough takeaway groups to start their own network. Something a lot of Real Estate and Lettings Agents are concerned with regarding RightMove & Zoopla they're doing their own networks. Will it work, I suspect not as individuals now think of their 'search agent' over the estate agent. Likewise, selling your own property with the web is not that hard either, do parties, save for the high end $60M residences (Leggie's) specifically use one agency/broker? No most either search via Zoopla, Rightmove, Primelocation (the very poor sister), and one I haven't often used is Nuroa.

So Cars have had the "nationalisation of pricing", Property, Food, Energy, the next step is children's kit. Something where there is a significant lack of a leader. The Savvy minded will be taking Kiddicare off Morrison's hands whilst its cheap and reorganising it. There's a number of changes needed at Morrisons that the current management clearly have missed in promoting brand awareness and 'the everyday essential demand' that is required nowadays. Such as Rightmove, OnlinePizza, Autotrader, webuyanycar.com/any house...There's massive opportunity for Kiddicare, perhaps being with Morrisons has limited that as their e-offering has been notably week. Will cover the news in due course!

Atb Fraser (needing a proof-reader)

Ding Ding Round 1 & 2 (In Small Caps) over LGO Vs. MOG

In making a number of assumptions here (not being privy to the full facts), one can only assume that LGO (Leni Gas & Oil) let Mediterranean Oil and Gas Plc Acquire the 10 per cent interest for the Maltese license for $1+$19,050 because LGO didn't value it. Likewise LGO didn't pay their liability of $19,050. 

Now the lesson here from what one can make out is that had LGO paid their liabilities they would have been entitled to further information. In the wording on the 01 August 2012, it is noted that MOG were "pleased to announce that they had acquired' which is consistent with the latter farm in/out with Genel (GENL). 

So not only have we had the excitement of the MOG winning the legal case but some Eastenders type drama with LGO's Legal update considering an appeal. They do not feel it relevant to to inform the market that their first appeal has been already turned down as per MOG's Litigation Update: Court awards MOG indemnity cost. 

So with two companies with a market cap of say £38m between them, one company sort to risk a significant proportion of shareholder funds on litigation circa £1m. The question is, what "prospects of success" [POS] did their Counsel advise? With the full facts and based on the small commentary from the MOG to date surely LGO's POS were not good (30-40% with a guess).

So Round 3, will LGO appeal again or go quiet and focus on what its been trying to do for years in terms of improving shareholder funds (the chart tells a story). Will there be another case in due course seeking damages as a result of the commentary post the acquisition of LGO's 10%? One can hope so to keep the excitement going but very much doubt it.

I wouldn't advise holding your breath for an RNS stating LGO is not considering a further appeal. Parties would have been better going the silent route whereby egos and face could have been purely down to commercial protection of each others shareholders interests.

The share price is likely to follow suit with LGO, albeit with a small holding I am in no rush to depart. MOG's has big exposure with little downside...

All the best, Fraser