GRR - Grange Resources

[fanger]

Is this stock a dividend trap? A 12% yeild seems to good to be true.

 

[Erlang]

Checkout the dividend history. They typically or historically do 2-cent payments, but did one or two 10-cent payments in the last 18 months. But they have now, it seems, returned to giving 2 cents. So that 12 percent yield would be based on the last two payments of 10 and 2 cents. The next dividend payment? Who knows.

The iron miner Fenix Resources (FEX) has even higher dividend yields, paid once a year, but they only started making profits a couple years ago.

 

[Erlang]

Note the extra/surprise interim 10-cent dividend in December 2021. My guess would be the 10 cent dividends were not the norm.

Note: Technically GRR is an iron pellet producer, which involves digging up iron ore and heating it up.

Compare GRR's dividends to that of the paid once-yearly dividends of FEX (who only started paying dividends 15 or so months ago).

This not a recommendation. I just thought of FEX as a small iron ore miner for a comparison, though they just produce iron ore, not pellets. (Image Resources (IMA) has a comparable dividend too, but they mine mineral sands, and only started paying the last couple of years).

Note: FEX diluted their shares in the last few months to raise some capital (to buy a trucking company), which probably *partly* explains their drop in price last year.

 

[divs4ever]

MARKET UPDATE

The Board of Grange Resources Limited (“Grange” or “the Company”) has announced that the Company’s CEO, Mr Honglin Zhao, will delay his retirement.

Mr Zhao will continue to serve the Company in his current position to ensure the goals of the next phase of important projects (including North Pit Underground and Southdown) are achieved.

-ENDS

i hold GRR ( free-carried' )

probably not a bad thing will give them extra time to find a suitable successor

 

[divs4ever]

CEO APPOINTMENT

The Board of Grange Resources Limited (“Grange” or “the Company”) is pleased to advise of the appointment of Mr Weidong Wang as Chief Executive Officer.

Mr Wang has over 30 years’ experience in management, engineering and projects in the steel industry. Mr Wang has held multiple high-level positions within Jiangsu Shagang Group, including Deputy General Manager at Northeast Special Steel Group Co. Ltd, assistant to the Chairman and Director of Technical Improvement Department at Jiangsu Shagang Group.

Mr Wang has extensive experience in project management and delivery, including a 5,800m3 blast furnace (BF), one of the world largest BF and new ironmaking solution, FINEX ironmaking projects.

Mr Wang holds a degree in Industrial Electrical Automation from the Shazhou Institute of Technology.

Mr Wang’s commencement date will be subject to the applicable approvals and working visa being granted. Upon commencement, Mr Honglin Zhao will retire from his position of CEO of the Company and retire from the Board of Directors. T


he key terms of Mr Wang’s contract are provided in Annexure A below.

This announcement was authorised by the Board.

i hold GRR ( free-carried' )

Substantial Shareholders List As of 30 Jan 2024​

NAME	SHARE HOLDING	SHARES HELD (%)
Shagang International Holdings Ltd and associates	554,762,656	47.90%

so of course the new CEO came from China

but has been a great stock for me over the last 12 years

 

[divs4ever]

my August 2024 comp. tip

( i hold free-carried ' ) and currently have top up order in the market ( so going down would not be that unfortunate for me )

has crazy metrics , is sitting on a pile of cash , and looking for partners to develop the new mine

• Cash and liquid investments of A$289.55 million and trade payable of A$5.37* million compared with cash and liquid investments of A$271.96 million and trade receivable of A$30.37* million for the March quarter

.• Early works program for Underground project progresses with detailed engineering design work and over 800 metres developed in the exploration decline.
• Concentrate production increased for the quarter with 675kt produced compared to 586kt for the March quarter with favourable milling performance.
• Pellet sales decreased for the quarter to 483kt compared with 565kt for the March quarter due to adverse weather delaying 2 shipments at the end of June to early July.
• Increase in average received prices for the quarter to US$134.69/t (A$206.11/t)* (FOBPort Latta) compared with US$108.11/t (A$166.03/t) for the March quarter.• Unit cash operating cost decreased for the quarter to A$145.05/t compared withA$161.70/t for the March quarter due to higher concentrate production.

Outlay of approximately A$22.7 million has been made in the quarter on capital projects including continuation of the Underground Exploration Decline, replacement of two 777ROM Trucks and upgrades to Savage River town-site accommodation.

since they have been looking for partners in the new mine for years , there is a very real chance they will go it alone at initially reduced production

 

[sptrawler]

Grange Resources, I've looked at them over the years, but never found a really good reason to buy, they were going to pump ore down to Albany from the Porongurups from memory and their mine in NW Tassie is laterite from memory.
It's good to see they are still going, gives me a bit of hope for IGO and Lithium at Greenbushes, the Chinese have a major stake in that.

 

[divs4ever]

Grange Resources, I've looked at them over the years, but never found a really good reason to buy, they were going to pump ore down to Albany from the Porongurups from memory and their mine in NW Tassie is laterite from memory.
It's good to see they are still going, gives me a bit of hope for IGO and Lithium at Greenbushes, the Chinese have a major stake in that.

View attachment 181715

yes an interesting relationship where the major iron customer is also the major shareholder , although the former Chairman ( of both ) has passed away .

some would call that a bad thing ( reliant on one single customer) , but since the shareholder base is stable ( around 10,400 shareholders for what it seems is years , maybe the shareholders are relatively content and patient

 

[sptrawler]

yes an interesting relationship where the major iron customer is also the major shareholder , although the former Chairman ( of both ) has passed away .

But the underlying interest is alive and well.

As long as the foreign ownership board keep an eye on Australia's interest, rather than allowing the foreign companies to become Dyson vacuum cleaners, sweeping up stranded assets. Time will tell.
But it is all looking like rope a dope at the moment IMO.

 

[divs4ever]

But the underlying interest is alive and well.

As long as the foreign ownership board keep an eye on Australia's interest, rather than allowing the foreign companies to become Dyson vacuum cleaners, sweeping up stranded assets. Time will tell.
But it is all looking like rope a dope at the moment IMO.

attractive enough to throw some more cash into it after reducing last year ( to help fund the farm purchase )

not a lot of cash , mind but some , now the question is , will Chinese steel demand taper in the next 5 years or will it stay stable as other nations become unprofitable as their manufacturing ( as costs rise and rise )

 

[sptrawler]

attractive enough to throw some more cash into it after reducing last year ( to help fund the farm purchase )

not a lot of cash , mind but some , now the question is , will Chinese steel demand taper in the next 5 years or will it stay stable as other nations become unprofitable as their manufacturing ( as costs rise and rise )

Well they have weathered many material cycles so far, so there is no reason to think, they won't keep doing so.

I'm too late to the game, to pull on a guernsey.

 

[divs4ever]

the 10 year chart shows this went as high as $1.60 , but i consider that an anomaly , i think this will plod along with a few dips and rallies as long the way as it fails to attract many big holders ( apart from the major holder/customer )

 

[divs4ever]

bought these as low as 11.5 cents a share in 2014 , the global economy is waning and this could slip below 30 cents this year

maybe not depends on what you call an attractive entry point

( BTW i reduced at 70 cents April last year )

 

[divs4ever]

my tip for the January 2025 comp.

i hold GRR and have a reasonably low-ball order for extra shares currently in the market

i hadn't previously noticed the ann. in the attachment , but it does demonstrate this company carefully considers its moves and tries to stay debt-free

it got booted out of the Top 300 last September so there will be less shares loaned out to shorters




* adjusted for the costs of freight and final pricing settlements on provisional settlements as per sales agreements.

Pricing is typically finalised in one to three months after shipment month.


Outlay of approximately A$24.5 million has been made in the quarter on capital projects including continuation of the Underground Exploration Decline, 789 Haul Truck Rebuilds,Face Shovel Rebuild and upgrades to Savage River townsite accommodation

and of course the MAIN REASON i bought into this ... it does NOT mine in WA missing that famous WA stormy weather

 

[divs4ever]

oh and it pays dividends when it can

GRR

GRANGE RESOURCES. ORDINARY

Change

Balance Date	Dividend Type	Cents per share	Ccy	Franked %	Ex-Dividend Date	Books Close Date	Pay Date
30/06/2024	Interim	0.500	AUD	100.00	13/09/2024	16/09/2024	30/09/2024
31/12/2023	Final	2.000	AUD	100.00	12/03/2024	13/03/2024	28/03/2024
31/12/2022	Final	2.000	AUD	100.00	10/03/2023	13/03/2023	28/03/2023
30/06/2022	Interim	2.000	AUD	100.00	13/09/2022	14/09/2022	30/09/2022
31/12/2021	Final	10.000	AUD	100.00	11/03/2022	14/03/2022	29/03/2022
30/06/2021	Special	10.000	AUD	100.00	15/12/2021	16/12/2021	29/12/2021
30/06/2021	Interim	2.000	AUD	100.00	13/09/2021	14/09/2021	30/09/2021
31/12/2020	Final	2.000	AUD	100.00	12/03/2021	15/03/2021	30/03/2021
30/06/2020	Interim	1.000	AUD	100.00	11/09/2020	14/09/2020	30/09/2020
31/12/2019	Final	1.000	AUD	100.00	13/03/2020	16/03/2020	30/03/2020

so i have all my investment cash back in divs. ( plus a bit AND franking ) since just 2020

but be careful they are trying to fund the new expansion going it alone ( since they couldn't attract a partner )

 

[frugal.rock]

i hold GRR and have a reasonably low-ball order for extra shares currently in the market

Can I ask at what price your low ball order is at?

it got booted out of the Top 300 last September so there will be less shares loaned out to shorters

Shorts on the way down for the last month but never got above 0.18% and only got up to around 1.4% around 3 months ago, which was it's highest in a 12 month period.

Might have to do a claculation using softening iron ore pricing versus weaker AUD, however I can't see the offset covering the difference.
That coupled with funding concerns for the expansion perhaps could just see it mothballed until prices improve.

I think that's what they are potentially relaying in their recent market update.

Bit of a big boo boo in their most recent quarterly! $54 million better off after correction!
($~27 million receivable instead of payable)

 

[frugal.rock]

Chart looking a bit grim also.
Do you think they will probably cancel dividends for a while?
Reduce franking %?

 

[divs4ever]

Can I ask at what price your low ball order is at?

Shorts on the way down for the last month but never got above 0.18% and only got up to around 1.4% around 3 months ago, which was it's highest in a 12 month period.

Might have to do a claculation using softening iron ore pricing versus weaker AUD, however I can't see the offset covering the difference.
That coupled with funding concerns for the expansion perhaps could just see it mothballed until prices improve.

I think that's what they are potentially relaying in their recent market update.

Bit of a big boo boo in their most recent quarterly! $54 million better off after correction!
($~27 million receivable instead of payable)

currently @ 17.5 cents .. but have bought them as low as 11.5 cents in the past ( September 2014 )

remember the major customer and the major shareholder have a relationship , so sell most of the output to that customer

Shagang International Holdings Ltd and associates

554,762,656

47.90%

Mr Xu is a former head of steel merger and acquisition division of Shagang Investment Holding Co Ltd, the investment arm of China's private steel company. Mr Xu specialises in investment of upstream and downstream processes for steel producers. Mr Xu has management experience in private equity projects

Mr Jiang currently holds the position of Investment Management Director in Shagang Group Investment Holding Co Ltd, being responsible for venture capital investment and project post investment management. Prior to this appointment Mr Jiang joined Shagang Group in 2013 as an Assistant Director of the Investment Department of Shagang Group.

Ms Shen is currently the deputy general manager of Shagang International (Singapore) Pte. Ltd., a subsidiary of Jiangsu Shagang Group, China's privateowned steel conglomerate. Ms Shen has experience in raw material procurement and trade, company management, and supply chain operation management and investment planning.

 

[divs4ever]

Chart looking a bit grim also.
Do you think they will probably cancel dividends for a while?
Reduce franking %?

View attachment 190790

well they are trying to finance the new project solo ( despite attempts to attract a partner in that project )

so withholding should not be a total shock to the investors , BUT then 3 of the directors have a history with the major shareholder

so MAYBE reduced divs. are more likely

 

[divs4ever]

they have been fairly solid on the franking ( when they paid a div. at all ) i suspect they will fully frank but reduce the divs to retain cash for the project .when they started paying out large divs a while back , i suspect that was deter a circling predator ( as happens when you hold more cash than your market cap. )