Wouldn't it be wonderful if minerals exploration companies could be cash flow positive before they have even discovered or defined a resource. This waiting for years for drilling results and the hassle of proving and quantifying the resources is such a pain in the ass isn't it.
Better still wouldn't it be good if you could build a mine without spending actual money thus avoiding this troubling issue of expendature impacting cashflow during development? Building a mine seems like such a wasteful exercise when you think about it. In a perfect world we would just say the magic word and suddenly the minerals all pop the the surface and load themselves onto the magic train driven by the pixies who take it to market for us and deliver back the proceeds in a pot made of gold. Much better.
I tried building a portfolio full of companies that met that criteria but sadly I had to use imaginary ones to fill it for there were no real world companies that worked like that. After a while my portfolio of imaginary companies and their ability to produce valuable income without actually doing anything made me cynical and I just ended up whinging about how real companies did everything so slowly in comparison to my imaginary ones. It was a bit sad so I sold all my imaginary portfolio to fund my virtual girlfriend. She's lovely and we rarely argue.
After all these years that CDU has wasted on exploring, applying for silly permits, buying lifesize Tonka trucks, determining optimal processing requirements, negotiating offtake agreements etc, yes, absolutely I see your point that having expendature spead over an extra couple of months makes one question why we are even bothering. The copper might not even be there anymore if it takes an extra few months to get there right.
And the dividends. Fair point. Not one I have ever thought about. From now on I'm only going to buy stocks that pay a dividend on July 1. Who would wait until half way through a financial year to get a dividend. Seriously, if a company can't pay a dividend in July of the year before it earns the money then it ain't worth investing in. Maybe Wayne should calls the guys from Centro and find out how they used to do it.
This rule about dividend payments being paid early in the fin year is particularly important this year. As the Mayans have determined that the world will end this December, my accountant has stressed how important it is to ensure dividend cheques are recieved and banked in the first half of the financial year. Apparently the ATO will assess you on your expected full year earnings for the 2012 financial year, even if the dividend cheques are not recieved before the end of the world.
CDU Price at posting:
$3.63 Sentiment: Buy Disclosure: Held
