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TRY 41.0¢

price expectation

  1. snapper82

    133 posts.

    Any one has a idea of price expectation after Friday ?
    cheers

  2. asf

    9,542 posts.

    The 3B got issued on the 11th- last Thursday, so most AZH holders already have their shares- potentially, if not practically, putting price pressure on TRY. It can take some time after new shares roll through the system, for a suitor company to get some stability, and get rid of some "unnatural" holders in the new company.

    Interestingly, the market cap of TRY and PRU are now the same, after PRU's rout today. The TRY dividend might be diluted to share around with the new holders, but it should still be decent, imo. It's something to look forward to.

  3. The chart is a bit depressing. No sign of a bottom yet...

    J

  4. loki01

    8,615 posts.

    asf

    TRY would be very foolish to pay a dividend in the current market conditions and in the light of their loan and funding requirements for Guyana.

    They need to get the new project up and profitable ASAP in case TRY's current operation becomes more of a silver mine rather than a gold mine and be even more heavily impacted by the low POS.

    Notice how TRY's share price has not bounced. I think there is some market concern about the profitability of its operations and need for cash. This transition period is its most difficult and they need to conserve cash or there could be a capital raising at some time.

    loki

  5. pisces

    10,555 posts.

    I have to agree there Loki .I've been an admirer of the management here and the stock was very kind to me .They've bitten the bullet and taken very much a long term perspective at what ,in hindsight ,was the worst possible time .I've been trading these over the last couple of months with mixed success and it's nearly killing me to not take a solid position but I'm just wondering whether all of the issues haven't been completely sorted.

    Nonetheless I'm as certain as one can be that over time Troy will prove to be a profitable investment from around these levels

  6. Hi all,
    I'm an NST older and have noticed the slide in the TRY share price over a long period. It seems to be stabilising and getting to a level that may attract me to buy in. Also considering SLR. I have done a bit of detailed research on TRY this week, but still getting my head around all the issues in the context of broader market sentiment. There are mixed recommendations out there (which I don't give a great deal of heed to, however Intelligent Invester Stocklight App gives it the green light and 7/7 on a range of fundamental measures) and I am inclined to agree that longer term the share price will only go Up. I am struggling though to find relevant company matters (positive or negative) that may significantly affect share price over the next 6 months or so (besides external factors).
    B.

  7. Justis

    12,182 posts.

    "TRY would be very foolish to pay a dividend in the current market conditions and in the light of their loan and funding requirements for Guyana."

    Sort of agree with you, personally I would not hold it against TRY for not paying a dividend for that reason.

    However, TRY are very proud for the fact they have paid conservative dividends over the last 12-13 years, in one years they delayed paying a dividend while getting casposo up and running but ended up paying a dividend before the FY end.

    Possible TRY will pay a small dividend to maintain the track record, remember that we have the divided reinvestment scheme so a lot of it would go back as equity

  8. asf

    9,542 posts.

    Good posts, guys. TRY will be paying a dividend- they promised in the Half Yearly:

    "The Board of Directors has confirmed that the Company is committed to the payment of a dividend based on the full year results to be published in August 2013."
    ___

    So, that is that. Now, as to the quantum. There's a clue in the target/bidder's statement, on p. 16. Under a graph showing the dividend history, it says:

    "For the year ending 30 June 2012, Troy’s gold equivalent production was 137,457 ounces and Troy reported a net profit after tax of A$31.4 million. Troy’s total gold equivalent production for the half year ended 31 December 2012 was 66,603 ounces."
    ___

    So, I saw that a a gentle warning that the dividend might be less this year, due to less gold production- at that time. perhaps the dividend could be 7c (a conservative guess). Should one halve that 7c to account for the 45% larger registry? The dividends are fully franked, so even if it's a few cents, it's not a bad deal. Other companies should go by TRY's example on dividends- 14 years straight is pretty good, but why don't other companies fully frank if TRY can?
    AZH says they will have a PFS out by end of 2013, so it will not be a quick process:

    http://www.azimuthresources.com.au/images/investorcentre_files/AZH%20TRY%20Presentation%2029%20May%202013%20-%20Latin%20America%20Down%20Under%2013%20May%20for%20printing.pdf

    In looking at the price to build a mine, UML has it at about $80m, but has made some cost savings, so less than that. Cheaper to build in Uruguay than Australia?

    As for the dividends, I hope TRY keeps them up forever- despite POG or capex or whatever. They have proved thrmselves, and their takeover of AZH is timely- they are quite lucky to have nabbed her, considering their other mines are running out, and for only about $100m- they could be laughing one year hence for this. If AZH keeps exploring, one could hope it becomes something of a PIR- high grade and profitable. Uruguay is in a good jurisdiction, too.

    A waiting game, but POG will probably rule all the goldies. Having said that, TRY and AZH need to get news out soon- seriously.

  9. SP being worked over today by lots of small trades.

    Have been holding off this goldy, but the upside on this looks good given sound financial position and resources in the ground.

  10. Eh? Uruaguy?-- TRY's holdings in AZH are all in Guyana--a very mining friendly country

  11. asf

    9,542 posts.

    Ye, my mistake- Guyana.

    Tumbling again today. I guess it makes the AZH takeover even cheaper. No consolation for holders. I watched SEA get smashed to the tune of 25% when the new shares came in from Texon Petroleum, but then it recovered. Different situation, as Texon may have been earnings accretive from day 1, but TRY is bound to recover from this.

  12. Justis

    12,182 posts.

    Quarterly report due soon will give us an update on TRY production and exploration results which will hopefully give the SP a boost, the full year report next month.

    Yes plenty of hints another dividend will be announced.

    Could also get news on exploration in guyana, from what I understand work has been ongoing.

    Early in the piece TRY mentioned they had already identified some second-hand plant and equipment the Guyana project so we make have more progress and news on that

  13. asf

    9,542 posts.

    Justis, I have a question for you. It may seema bit bearish, but I don't really mean it to be. Is it worthwhile comparing production and market cap on some of these gold shares? So, PRU has production of >200,000oz. TRY has production of >100,000oz. They both have similar market caps now- around $220m each. As we know, PRU has been hit hard re costs, etc. So, to those who wish to be 100,000 producers- UML aims for that when Dargues is built- around March 2014 is the aim. It currently produces 50,000oz. Current market cap of UML is $47m. MOY aims to produce 100,000oz by year's end. Current market cap is about $70m.

    Looking at oz produced, do you think TRY could have more to cool in share price/market cap, or is it just too crude to go on this measure? Your thoughts as well as anyone else's, is appreciated.

  14. Justis

    12,182 posts.

    asf, I'm no expert but I would say there is a lot more to it than oz produced.

    Without knowing much about the others you mention, thing like mine life, exploration potential, production cost and debt levels need to be considered.

    keep in mind TRY has relatively few share, even after the AZH TO it is 164 million, most gold stocks have many multiples of that

  15. asf

    9,542 posts.

    Oh, for sure, Justis, about grade, cost, and all manner of other things, being relevant. Scale would be a part of it, too- the more produced, the cheaper it should be (except for PRU, who had the cost blow out). I guess we've also had FML- a 100,000oz producer, just putting their mines on care and maintnance, too, and is now @ cash-backing. Not all miners are created equal, clearly. Perhaps it is the merit of TRY that, as a 100,000oz producer, it has a similar market cap to that of PRU, a 200,000 producer. Also, PRU's Sissingue project, is to be put on hold, even if it doe get mine approval. No chance of AZH's mine being put on hold.

    Thanks for the reply, Justis.

  16. Justis

    12,182 posts.

    Cheers ASF

    As a long term holder of TRY I am impressed with the management team, they really do care about shareholder unlike a lot of them that seem to run a company for there own benefit.

    Good example is the recent announcement that directors would take a 25% pay cut along with other cost cutting measures, not often do we see example like that.

    Try have always aimed for low cost production mines, seems like the smart thing to do as it allow for a profitable operation at lower POG where others would have to shut down.

  17. asf

    9,542 posts.

    I agree with you on all counts, Justis. I also like Russell Clark, formerly of Grange. He was one of the most respected CEO's when he was at Grange. It is though he left there due to not being able to get the best outcomes for minority shareholders against the majority holders (Shagang) who are also Grange customers. Unable to reconcile the conflict of interest, and knowing Shagang dominate the Board, he left. An article about that:

    http://au.news.yahoo.com/thewest/a/-/breaking/14322886/grange-exit-unsettles-market/

    He's a good man to have on board TRY.

  18. Justis

    12,182 posts.

    asf, Russell Clark became CEO of AZH early this year, I read some thing along the lines that his job will be gone after the TO.

    As Paul Benson is CEO of TRY, they may keep him on in another capacity but with the cost cutting IMO Clark will be made redundant

  19. Sorry, but I don't agree with the rosy sentiment of a couple of posters here. The market as a whole is pretty clearly indicating that it doesn't like the job management has been doing. Perhaps I just do not have the "glass is a quarter full" outlook needed to see this sustained downward slide as a good thing. It makes me doubt whether this really was the best M&A option available. If it was the best, perhaps they should have kept looking...

    J

  20. Sorry, but I don't agree with the rosy sentiment of a couple of posters here. The market as a whole is pretty clearly indicating that it doesn't like the job management has been doing. Perhaps I just do not have the "glass is a quarter full" outlook needed to see this sustained downward slide as a good thing. It makes me doubt whether this really was the best M&A option available. If it was the best, perhaps they should have kept looking...

    J

  21. loki01

    8,615 posts.

    Out of desperation I bought some TRY shares on the opening today and got lucky with a very nice bounce. My goldie larder is very bare and there is not much left that is relatively cheap so TRY was my pick.

    I suspect the quarterly report will be a bit of stinker, just like PRU's was and all the others that are waiting to release their reports on 31 July. You know the usual story - the dog ate the paperwork and I want to contain the bad news as long as ASX listing rules will allow.

    I still have no confidence in the POG playing along and where it goes is dependent on the US Fed Chairman. Benny is becoming harder to read - will he or wont he start tapering before he goes and how dovish will his replacement be? I am clueless.

    You can not invest in goldies, they are just a speculation and I have no idea how long I will hold onto these shares.

    GLTAH

    loki

  22. loki01

    8,615 posts.

    Too much dumping of this one over the last few days so I am out. Not sure what is going on, but the rush to the exits says something I suppose.

    GLTAH

    loki

  23. PussnBoots

    1,851 posts.

    Thats a shame Loki but admire your resolve.
    Think its a bumpy ride everywhere. Very emotional and nervous herd mentality going on thee last 6 months (even more so than the usual sharemarket antics).

    Am hoping looking in the mid to lonnger term, these guys are pretty well placed so I'm happy to sit tight.

    Hope to se you back in again at some point.....just hopefully not due to the price tanking any further for no real reason!

    PnB

  24. MrGordon

    3,782 posts.

  25. loki01

    8,615 posts.

    PussnBoots

    Thanks for our thoughts.

    No harm done to me here - I am just being careful. I had a rethink about this one last night and decided I would exit early.

    I think we will find the answers to why TRY is not responding to the higher POG when we see the quarterly report. I think some have already worked it out or are in the know and are taking anticipatory action.

    PRU fell back like a stone once it released its quarterly report and let the cat out of the bag about its woes. Being upfront did not do anything for their shareprice.

    I suspect this will be the case for TRY (and will be the case for many of the other current goldies whose share prices have had good recoveries in percentage terms (eg SLR, RSG, EVR, BDR, SBM) once they also report. The main issue is costs relative to the POG.

    Unfortunately goldies need a much higher POG to make reasonable returns and have cash for expansion.

    I will keep TRY on my watchlist. TRY has solid management and should survive, unless the POG heads below $USD1000 and stays there. They really need the Guyana project in operation, but this will take another 2 years. This is the project that can make TRY into a mid-size goldie over time and is the main reason I have taken more than just a passing interest in TRY.

    Good luck.

    loki

  26. WangChung

    8,352 posts.

    I would have thought at these levels, any bad news would already be baked in the pie.

  27. WangChung

    8,352 posts.

    I'll go a step further...

    If the results aren't extraordinarily bad, you might even get a decent bounce in the share price.

  28. Gordo7

    34 posts.

    The price action this week has been a cause for concern.

    A stock with good fundamentals (in comparison to other gold stocks) but still close to its lows when the majority of other gold stocks have had a good run this week. No reason for TRY not to have participated at least one day this week in my opinion.

    Suspect a big seller or two, volume has been heavy, but the price action is disconcerting and makes you wonder if someone knows something.

    I hold but could sell very soon if there is no overdue outperformance.

  29. hotmix

    259 posts.

    I suspect the volume is probably not a large seller or two but a number of ex AZH shareholders grabbing their profits and departing.
    I expect the SP to edge back up when they've sold all their stock and move much higher when the gold price increases.
    This is a well managed company with much more reserves in the ground and increasing.

  30. Gordo7

    34 posts.

    That makes sense Hotmix. Had not thought about that.

    If that is the case and if the POG holds up should anticipate some significant price appreciation (catch up) at any time.

  31. snapper82

    133 posts.

    Not all of the azh holders are selling, happy to hold at these levels, next 3 month should be interesting

  32. asf

    9,542 posts.

    I think the market was just waiting for the Quarterly. Now that it's out, there should be some share price stability. A tense time of year for all of these goldies.

  33. asf

    9,542 posts.

    Here's TRY's dividend history, for anyone interested:

    http://www.sharedividends.com.au/try


  34. Yeah,it did plunge to the deep late,so did many goldies.

    Fear of a good jobs report from the US tonight,seems to have
    weighed on gold and gold stocks.

    For a longer term investment could be a decent entry price on
    monday.

  35. mxzjimmy

    45 posts.

    why is this stock keeping going down???

  36. Haha oh Danny boy the pipes the pipes are blowing!

  37. hotmix

    259 posts.

    Run for the hills, throw out the women and children............... She's agunna blow!

  38. gttrain

    4,642 posts.

    What are the chances of a dividend next month?

    Got a parcel today and short term the gold price is gonna control this one. A quick blast below 1300 on friday arvo got em scared.


  39. dargie

    4,418 posts.

    If they are cutting costs across the board and execs are taking salary cuts to conserve cash, I would say you have buckleys chance of getting a dividend.

    The share price decrease is ex Azimuth holders selling out and/or the arb traders selling out as their profits are threatened and/or whittled away already.

  40. loki01

    8,615 posts.

    We will know in the next quarterly report if their cost cutting has been successful in restoring profitability in the new low POG environment.

    Last quarter TRY/AZH were cashflow negative. Hence the need for activating the Investec loan facility. Casposo needs to generate a large cash surplus to fund activities in Guyana.

    Clearly they will need to fund the Guyana mine from additional borrowings.

    That was a pretty uninformative presentation at DnD.

    Some nice drill results announced today - but the market already knows there is economic gold in Guyana so not much response, I suppose.

    The goldie market could remain frustratingly tepid for another year.

    loki

  41. rowingboat

    3,197 posts.

    I wouldn't rule out a dividend just yet, say 4c ($6-7m), delayed perhaps to late in the year with successful transitioning to UG ore production at Casposo.

    Loki, the March Qtrly indicated that income tax payments of $12.4m would occur in the June Qtr. There was the $10m outgoing to AZH and $18m capital investment at Casposo (UG mine development & mobile equipment purchases as they move to miner-operator, plus the plant expansion & commissioning).

    Open pit mining costs have been high in the past nine months. Later this month however, higher grade ore will be exposed and waste stripping and therefore mining costs are set to fall significantly. At the same time UG tonnages will begin to increase.

    Most importantly from my viewpoint is they stitched up the merger with AZH quickly and cleanly and results are already flowing. Note today's statement "start with small scalable plant"... good time to shop and they'll have parts from the Andorinhas plant as well.

    BTW, 'nk' put me onto these W.D Gann specialists who are positioning themselves for a major bottom in commodities in the weeks ahead followed by runaway moves (60-yr cycle).
    http://www.gannglobal.com/

  42. MrGordon

    3,782 posts.

    Clearly they will need to fund the Guyana mine from additional borrowings.
    --------
    I am not so sure! The POG for the present 1/4 will be higher than what it averaged for the one just reported on unless it tanks again(unlikely imo) Also the intention is to mine higher grade now.
    I think the news regarding vulture funds is what has most weighed on the SP and am anticipating a good outcome there and hence am now back in.

  43. dargie

    4,418 posts.

    Not dismissing what you are all saying, but borrowing money to develop and then paying a dividend, well that does not compute in my book.

    Big sell signal if that is the case. Just digging a debt hole that is unnecessary (and in my opinion reckless).

  44. What you have to consider here is the falling gold price is offset by the weaker Aussie dollar. Gold at $1300 an ounce in round figures when repatriated back to the AUD is $1460 an ounce. Today's rate cut will help this further. . Troy will pay a dividend, my guess is 5 cents per share, the cost cutting measures are in place in order to maintain their run of 13 dividends on the trot. This is something they are very keen to maintain.

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