copper price increasing from lows, page-3

eagle888, no I don't know enough yet.
the company has yet to make comment to the asx about the issue.
The last annual report page 42 of 104 item 2(b) refers to the going concern issue and makes comment that the $45m debt facility with Macq' has to be refinanced in dec 08 and the ceo's comments talked about maximizing cash flow from the expanded Laddie Annie operations, selling non core assets to lower debt, surplus cash to be re invested in new business and to seek to unlock value from core assets.
The target of 58% increase in production (nov 08) to 30,000 tpa . Cash cost at US$1.08c lb. Copper price this morning up about 6% to US $1.67.
The 250koz of PGM pa in 09 which CUO has a share in should add to forward earnings particularly as the market price of Platinum rebounds.
I'd like to see them sell the gold asset in Greece, the China gold asset, keep the PGM assets and all the assets in Australia ( inc' the Lady Loretta Zn,Pb and Ag)
Copper went up about 6% last night which could see the CUO share price go back to the 10c levels on Monday and if the Copper price starts increasing over the next month, prices of 12c to 14c could be seen. The key will be the announcement on the refinancing which I think is having a big dampener on the share price currently.
And that's the challenge....to weigh up the upside and balance the risk. They will be up the creek without a paddle without the finance. They are in the fortunate position to be able to show dollars coming in through production after spending a lot of money on the plant and equipment.
Those with a low tolerance to risk would be unlikely to be buying CUO at the moment until the refinance is announced.
I traded CUO earlier in the year, in at about the low 60's and out in the high 60's from memory. The $56m raised at 54c earlier in year makes 8c look very, very oversold. To me, it's an opportunity with risk and high reward balanced against the refinance risk.
The company should be announcing something pretty soon as if they don't, it would mean to me that they are having difficulty convincing Macquarie. If they get the refinance committed I'd expect a rapid move in the share price....that's the reward for accepting the risk of not being able to get the funds.
The share price, after a successful refinance, could return to the 20c to 30c levels particularly if the copper price rebounds further at the same time. All a bit of a guess until we see the details.
The good thing is that interest rates are falling which should be making things easier for the discussions the company is having. The lower interest rates should also be good for Copper Co's bottom line profit.
As always, DYOR etc.
http://www.brr.com.au/asx/CUO/copperco-limited/