Ann: Nifty Copper Operations Update, page-57

Interesting release, with just the bare minimum of information given out, if you had to summarise this release it would be something along the lines of:



As described in the last Qtrly where we reiterated that the Nifty operation was turning around, we still have confidence in our ore body, are developing "mining stocks" (i.e. we can drill and prove the orebody) and we are fixing ventilation and paste fill systems, despite progress in all of these we still can't access or fire stopes and underground equipment availability is poor so we still can't get the tonnes out of the ground. So we are now reactively doing an operational review that everyone in the world was asking for before we bet the future of the company on Nifty.

No metrics to support this contradictory information. No mention of things like we targeted X tonnes paste filled but only got Y tonnes filled, or we targeted A tonnes of ore out of the ground but only got B tonnes, or we aimed for 98% utilisation on our bogger/truck fleet but got 85% availability. Surely they could give us some metrics for f%#k sake??

Or how about, who is doing the review? Or how much time this review will take, and whats in the scope of the review and whats not?

Looks like a bit of a "kangaroo in the headlights" news release to me where they are admitting they have a problem, and maybe are worried that some operational news may be leaking out already? As a matter of fact the large volumes from late Sept may be indicative of news leaking, out or larger holders moving in and out.

Looks like a short term trading stock now, but timing your entry is very difficult because there are only a few events that will turn sentiment? Complete management shakeout, a decision to put Nifty on C&M, or a low-ball opportunistic takeover offer. Right now the cash burn, current distracted management, stubbornly modest Cu price and numerous operational problems are a major source of downwards inertia for the share price.

Can't say that it won't get any worse with any certainty, they could surprise us with a "Oh the main decline has collapsed" or a "Oops the mill has fallen into the open pit" release tomorrow, that's about the only things that haven't gone wrong with Nifty, but a lot of bad news baked into the share price now. Even if they announce the closure of Nifty tomorrow, its difficult to predict the market reaction, the market might like it and lift the SP recognizing that the bleeding of cash will cease or it may provoke another swoon like today as everyone rushes for the exit.