I recently emailed IBG with a series of questions. Original and responce below. Some names/contact details are obscured for what I determine to be relevent.
From: ?????? Sent: Thursday, 13 December 2012 8:14 AM To: ????? ????? Subject: Shareholder enquiry
Hi ?????? I recently called you twice to garner some information with regard to my investment in Ironbark Zinc. Unfortunately both times no one was available to respond. Hence I am writing with hope that someone will return my call and address the enquiries below. Firstly while I am quite concerned about the recent share price I am more concerned about my investment. With regard to Glencores recent merger and talk that they will be selling off interest of some of their zinc assets to gain EU approval quicker, does this have any effect on agreements with IBG? Has any of the $50 million facility with Glencore for acquisitions or working capital been drawn down or likely to be? Has IBG enough working capital for the foreseeable future and is a CP possible? With regard to the possible acquisitions mentioned in many ASX announcements can you clarify what this means? Will it mean acquiring a company similar to Ironbark or more downstream with processing plant etc? Are there expectations when a BFS/DFS will be available? The original is well overdue. Has there been any comments received about the recently submitted EIA? Is it the aim to continue spending on further exploration or focus on more near term goals of mine production? Would a SPP be considered to support the chronic share price? As I am a small share holder within the IBG structure all I have to go on are the ASX announcements, and to be completely honest these generally seem to contain little new development, and any presentations to major shareholders/brokers I am not privy to. Your assistance in addressing my concerns would be greatly appreciated. Regards ?????? ??????
Dear ?????? Thank you for your email – I am equally concerned about our share price fall which appears to be the result of a single large retail shareholder selling out. As far as we are concerned here –the business itself is progressing well. ?????? I will answer your questions in the order asked below:
I have asked Glencore directly about the Xstrata merger impact and they do not see any change with regards to their position in Ironbark. In fact, in my opinion, as they are seeking to merge with Xstrata and the Xstrata growth model is the path that Ironbark is hoping to adopt- we are hopeful that our model remains attractive to Glencore.
At this stage none of the $50M facility has been drawn down however Ironbark and Glencore have made joint offers under the facility and will continue to do so –at this stage, for a variety of reasons, our offers have not been accepted.
Yes, our working capital position is sound with no debt. We are awaiting the capital cost estimate which is being worked on by NFC and Arccon and hope to update the market by February 2013. Do you mean a capital raising by CP? None is planned.
Our acquisition strategy is flexible and opportunistic but we are seeking a base metal opportunity that is in production or close to it, that is undervalued, possibly due to a one off negative event that has resulted in a distressed capital raising, but that can be resolved.
The DFS is expected as part of the Arccon work in February 2013. The key results as released on 12/10/2011 are close to a DFS release however the 2011 drilling increased the material that could be categorised as minable (indicated/measured) reserves by 56% (released this year), the updated mining scheduled (2012) increased the life of mine head grade by 26%, the increased throughput (+10% to 3.3Mtpa) and potential capital cost reduction ex NFC (hoping for a 10-20% reduction). This is a material and positive outcome. When we release a final DFS obviously we want to include the best results possible and we certainly feel that we have some better numbers to put forward.
No – not at this stage. The EIA submitted was done with a strong collaboration from the Danish and Greenlandic environmental departments as well as Danish and Canadian environmental consultants – these groups should have limited further comment.
No- the mine life is already 16 years and would be a top 10 global zinc mine and we have gathered all the site data we require for a DFS with no likely further value to be added from exploration on site at Citronen. We expect to be drilling on other projects in January/February though (Captains Flat/Peak View)
I don’t see how an SPP would support the share price? – my experience see SPP’s and any other rights issue seeing the stock falling to the rights price and probably not raising much money – which we don’t really need at this time. Please let me know if I misunderstand you?
?????? –the presentations made to brokers are generally released on the ASX too – I would be happy to personally go through our growth strategies: 1 Citronen Development, 2 M&A 3 Exploration - which we are progressing on all fronts although we have had some disappointments on point 2 and the zinc price/market has been weak and has not helped us. I am on leave for 2 and half weeks and can be contacted on my mobile ???? ??? ??? and would be happy to speak about what we are doing in more/any detail if you wish.
Again, I feel the business is moving ahead with a great project, it is well backed but the market is seriously hurting our share price. I can’t explain why our price has collapsed so much other than a single large aggressive seller and hope to see that resolved shortly. Thank you being a shareholder and I am genuinely happy to speak with you so please feel free to call.
Merry Christmas. Jonathan Downes Managing Director
IBG Price at posting:
6.5¢ Sentiment: LT Buy Disclosure: Held
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