AEX - Acclaim Exploration

[alphman]

alphaman,
what do you think of there prospects in guinea in the new md?
from what i have been able to research it seeme dto be a step in the right direction

Don't know much about Guinea. All I know is that Nova Energy and Murchison United are they as well, but their projects are all in the early exploration stage.

The new managing director does seem very interesting though. Ralph Bagirathi was appointed CEO Africa for Brinkley Mining back in January. He has experience in "mine management, project development and project finance".

So why would Acclaim need a managing director with this experience if they weren't in a position to take DD to the next level? They've gone this far without an MD so why now? Also, Ralph had a pretty sweet position at Brinkley and if DD (or AEX) was a dud, why would he quit is job over there (after only 6 months) to join a dud? I'm sure this guy knows better.

Personally, I think there is more to it than meets the eye. There is something going on and not enough being said...

 

[bruno]

Don't know much about Guinea. All I know is that Nova Energy and Murchison United are they as well, but their projects are all in the early exploration stage.

The new managing director does seem very interesting though. Ralph Bagirathi was appointed CEO Africa for Brinkley Mining back in January. He has experience in "mine management, project development and project finance".

So why would Acclaim need a managing director with this experience if they weren't in a position to take DD to the next level? They've gone this far without an MD so why now? Also, Ralph had a pretty sweet position at Brinkley and if DD (or AEX) was a dud, why would he quit is job over there (after only 6 months) to join a dud? I'm sure this guy knows better.

Personally, I think there is more to it than meets the eye. There is something going on and not enough being said...

agree totally alpha, and whilst i viewed guinea and ralph as postives i like to see some news re guinea aquistion.

 

[alphman]

agree totally alpha, and whilst i viewed guinea and ralph as postives i like to see some news re guinea aquistion.

Hi Bruno,

My views on Guinea...

FOR:
- Spread operational risk across multiple projects (DD alone is too risky)
- Grow the company through acquisitions (provided they make the right choices)

AGAINST:
- Denny Dalton has lost about 6 months of progress due to delays. They need to focus on this one to bring it back on track.
- These acquisitions aren't free so there will no doubt be some (more) dilution when it happens. Even more when they start working on them.

Not much excitement for me in the short term. Long term perhaps, but like I said earlier, this is a gamble stock so long term is out of the picture for me...

 

[bruno]

Hi Bruno,

My views on Guinea...

FOR:
- Spread operational risk across multiple projects (DD alone is too risky)
- Grow the company through acquisitions (provided they make the right choices)

AGAINST:
- Denny Dalton has lost about 6 months of progress due to delays. They need to focus on this one to bring it back on track.
- These acquisitions aren't free so there will no doubt be some (more) dilution when it happens. Even more when they start working on them.

Not much excitement for me in the short term. Long term perhaps, but like I said earlier, this is a gamble stock so long term is out of the picture for me...

good points alpha,
heres hoping the dd annoucment is positive then and that mr bagirathi brings some quality management skills to aex

 

[bruno]

And with an announcement "imminent" AEX has increased volume since about 12 oclock, could be a very interesting afternoon re the announcement.

 

[the barry]

And with an announcement "imminent" AEX has increased volume since about 12 oclock, could be a very interesting afternoon re the announcement.

If only i had a dollar for everytime that has been posted........ lol. Has to come out some time soon??? They say good things come to those who wait, these results must be really, really good.

 

[alphman]

Hey guys,

With the results looming closer and closer, here's some food for thought...


The Upside

Will we see $0.20?

These guys already have JORC inferred resources of 11,025t U3O8 and 2.5moz Au. With the amount of drilling that has taken place over the past 8 months, we should see some resources move to the "indicated" and potentially "measured" status in their upcoming resource estimate.

If the resource estimate is maintained above 10,000t (22mlb) U3O8, it will not only extinguish all the doubts and negativity the market has towards the company, but it will also position it in line with BLR, EXT, BMN, and MLI in terms of resource, ahead of BLR and EXT in the timeline, but behind BMN and MLI.

BLR Market Cap ($0.20): $140,000,000
EXT Market Cap ($0.80): $147,000,000
BMN Market Cap ($2.75): $400,000,000
MLI Market Cap ($0.70): $480,000,000​

Assuming the average "enterprise value per pound" for the Uranium industry is $10 (see footnotes) and this is being conservative, at 22mlb of resource, we get an EV of $220m which falls within range of the above companies. This equates to $0.33 per share, or $0.20 on a fully diluted basis.

Denny Dalton also has gold credits that cannot be dismissed, and this will give the company more reason to trade at or above the $0.20 mark.

Going by the above simplistic valuation, which is by no means accurate nor professional, one can imagine that we could see $0.10 even with 5,000t, but reality will probably see Mr Market punish those who had any hope.


The Fall

AEX have a significant holding in MLX (22,500,000) which at $0.44 is worth $0.015 per share. They should also have about $1.5m left in the bank which is equal to $0.002 per share. This brings the absolute bottom line at worst case scenario to $0.017. This assumes that Denny Dalton has zero value and the same for everything else they got going for them (property, equipment, new MD, Guinea, etc), which is highly unlikely.


My Personal Conclusion

IMO, the impact of the upside is far greater than the impact of the fall, however the probability of seeing the fall is greater than the probability of seeing the upside. I continue to hold my small parcel with my fingers and toes crossed. I just wish they'd end this misery already and release those results!



Disclaimer:
I have no qualifications in this area and often don't know what I'm talking about. Do your own research and make your own conclusions.


Footnotes:
http://www.extres.com.au/documents/Announcements/EXT_15062007_rev1.pdf

 

[bruno]

Nice post alpha and youve made some good points. As i have said before i have only held aex for a short time and still hold a postive outlook for the company but i can see why people like barry get frustrated. These guys released a statement over a week ago that the results of DD are "imminent" which by defintion means they are at hand or about to happen so in my opinion over a week is well and truly long enough.
I have three opinions on the delay:
1) That ccic are dragging there heels in completing the report to AEX hence the delay
2) The report is fantastic and AEX are trying to figure out the best way to deliver to the market (this is the wishfull thinking opinion)
3) That the results from DD arent flash and they are pushing back the announcement so it is either close or coincides with the Due Dillegence period of there acquistions in Guinea so they can balance with some good news.

Only my opinions and would be interested to hear what others think.

 

[Wysiwyg]

A sleeping beauty by definition :- Sleeping Beauty.......A company that is prime for takeover but has not been approached by an acquiring company.

And lets not hold our breath

Surely the amount of resource will be greater, but market sentiment, as Alph pointed out, is always a deciding factor.Fair comment Alph.

but reality will probably see Mr Market punish those who had any hope.

 

[alphman]

...the Company’s exploration consultant CCIC has formally informed the Company that these results are now imminent.

I think this basically means that CCIC have everything they need now from SGS (ie. no more delays) and that they are in the final stage of compiling all the data and preparing the technical report. If they were still waiting on SGS, then CCIC would have said just that rather than take a hit for them. For "imminent" to be interpreted as being immediate I think is wrong. There is a lot of data to work through and a technical report of this size would take time to write and validate. How long I dont know but my guess is two weeks, three weeks max??

If you look back through their previous announcements, first phase drill results took 7 weeks (from 31-Aug-06 to 19-Oct-06) for 896 samples. On 16-May-07, the final 675 samples were submitted to SGS. Assuming this takes 7 weeks to process due to backlog/delays, we get 04-07-07. 6th July, the above announcement made. Makes sense to me. Two weeks from the announcement is this Friday so I'd say that we'll see it either end of this week or next week, but then again who knows...

Guinea due diligence period expires tomorrow so they may wrap it all up in the one announcement. One thing I know is that this will be a massive announcement regardless and it might not be easy to make a buy/hold/sell decision.

The Company’s exploration consultants, CCIC, will then submit a detailed exploration and resource report on the Denny Dalton project. This will include a summary of all drilling, assay results, geological models and resource estimates. This report will be released by Acclaim Exploration as a single announcement as soon as it has been received.

 

[bruno]

Hi Alpha,

Cant disgaree with your time anaylsis re the results and anaylsis i just think with there apparent track record re these things they shouldnt have use the word "imminent" because as i said the defintion is "immediate, to hand or about to happen" which then raises shareholders expectations I think they would have been better off just saying they are expected by the end of July or in 2-3 weeks maybe?
And yes it is going to be tough (but isnt that half the fun) trying to make a buy/hold/sell decision when the ann is finally out

 

[alphman]

Agreed - they definitely need to cut the crap.

Anyway, I've noticed quite a few companies have used "imminent" in their announcements. It must be a "buzz" word in the industry. Of course, when it becomes such a thing, people tend to use it in the wrong context...

 

[Wysiwyg]

Agreed - they definitely need to cut the crap.

Anyway, I've noticed quite a few companies have used "imminent" in their announcements. It must be a "buzz" word in the industry. Of course, when it becomes such a thing, people tend to use it in the wrong context...

Hows it goin` chaps:bekloppt:....mastered the imminence yet?:cussing:

I reckon that every stock with the letter `X` in the code has posted something in the last 6 weeks except the `ol AEX.
An interesting observation I have made is the varying degrees of tolerance and patience.Waiting drives people crazy.esok:

 

[bruno]

Hows it goin` chaps:bekloppt:....mastered the imminence yet?:cussing:

I reckon that every stock with the letter `X` in the code has posted something in the last 6 weeks except the `ol AEX.
An interesting observation I have made is the varying degrees of tolerance and patience.Waiting drives people crazy.esok:

The more time that goes buy the more i think option 3 i posted on the 17 july looks like the likely outcome. Only my opinion and i hope im wrong

 

[alphman]

Woohoo! PoU now US$120/lb. Down US$10 from last week. Biggest fall so far!!!! Just in time for the drilling results!!!

:swear: :swear: :swear: :swear:

 

[bruno]

ann out late today re delay in dd results.

looks like more waiting in store for all holders.
oh well they say patience is a virtue

 

[Wysiwyg]

Agreed - they definitely need to cut the crap.

Anyway, I've noticed quite a few companies have used "imminent" in their announcements. It must be a "buzz" word in the industry. Of course, when it becomes such a thing, people tend to use it in the wrong context...

If I had a million dollars I would say that it is all bull****.I haven`t. I`ll say it anyway.Full of ****.

Reason?.....You DO NOT tell the company and shareholders lies such as imminent and then say more delays.Integrity is priority in communication.FLUNK.

Where are the average persons rights here?
Answer = I have none.

 

[Wysiwyg]

If I had a million dollars I would say that it is all bull****.I haven`t. I`ll say it anyway.Full of ****.

Reason?.....You DO NOT tell the company and shareholders lies such as imminent and then say more delays.Integrity is priority in communication.FLUNK.

Where are the average persons rights here?
Answer = I have none.

THE CORRECT COMMUNICATION TO SHAREHOLDERS TWO MONTHS AGO IS.....

Due to workload and upgrade there will be a considerable delay in processing of drill samples and resource estimates.

 

[king.jackson]

Looks like things are picking up again for AEX.

Any thoughts? Maybe something cooking in the kitchen and the smell is starting to drift into the dinning area!...

 

[Wysiwyg]

Looks like things are picking up again for AEX.

Any thoughts? Maybe something cooking in the kitchen and the smell is starting to drift into the dinning area!...

No they are not picking up.

I must have passed the AEX wishful thinking on to you.Good luck byyyeeeeeeeeeeeeeeeeeeeeeeeee.