Ok. So.
I finally had time to read the quarterly with a less emotive viewpoint. There is a fair bit of qualitative information, but... lacks the required quantitative figures for true comparisons. We do have to look at the big figures, and... their production costs are simply too high, though... and let me be clear, this is not financial advice, just my ponderings on my part... the main increase is the expanded U/G mining (not just the development, the development has actually decreased, from $14.8m down to $9.5m, which makes sense as the Scotia open pit pre-stripping was a sort of upfront hit).
Everything is this first table basically has to be doubled because it was still 50/50 with TUL. The quarterly makes it clear they are still having issues with the contractor.... staffing and dilution. This likely means the contractor is bleeding staff but... throwing $$ around to keep filling seats, not... with the most experienced in W.A. Basically, they spent $39m on operations in the June Q, with $14.6 on non-sustaining. I think $43-45m is what it should be sitting at once it reaches commercial production rates. It helps that the likes of WGX are basically able to run 3 plants at approx $120-125m per quarter, or... $40-42m per plant. WGX do have some serious efficiencies of scale and are basically owner operators, so... that could be saving them at least 10-15%, which would imply $45-50m is more reasonable, which.... leads me to thinking that whilst the numbers are high for PNR in the Sept Q, they are not... world ending.
.
The quicker they get rid of Halls Creek the better, that is $2.4m saved per Q. No more bloody merger costs (total was about $13m, what a bloody joke).
Above all, PNR need to get the Scotia open pit ore closer to their reserve grades (even just 2g/t would be enough). As the U/G is likely to be cover the slake once it hits full production.
I follow another newish.. producer CYL, which had quarterly costs of $43m. It just acquired the asset, which.... was already in full production for years, so somewhat different to PRN, but should show what is possible, plus, their average grade was 2.1g/t, which is what PNR produced in Sept (this should undoubtedly increase at both Scotia and U/G though.
I mean... sheesh, the grades they are seeing are.... worthy of attention, even if PNR is doing terribly at producing it profitably.
Whilst of course profitability is key, it can only be achieved if these issues are resolved.
Some very simplistic calcs...
Grade for Sept was 2.1g/t.
Processing looks to be running at 256k for the Q, with the highest rates in Sept, at approx 86kt at 2.1g/t (recovery 90.7%), for 5300 ounces.
If the grade hits 2.5g/t with another 86kt for Oct - 6.3k ounces (revenue of approx $18.9m)
If the grade hits 2.6g/t with another 86kk for Nov - 6.6k ounces (revenue of approx $19.6m)
If the grade hits 2.7g/t with another 86kk for Nov - 6.8k ounces (revenue of approx $20.5m) (Total- $59m)
Then.... it's all about consistency. If either throughput of grades increase further, then PNR will become cashflow neutral/positive.
Easy to put numbers on a screen, much harder to do in a gold mine without a doubt, but... even if the reserve grades for Scotia and OK mine are 10% below, the average grade should be closer to 3g/t
The MD has really made a hash of things, though... perhaps TUL were no better and simply acted as a ball and chain, as how can they state this in the quarterly....
When in August they stated this....
At least be brutally honest and just retract what was put out earlier.... say we are aiming to put out guidance early Jan for a CY2025 target etc.
Anyway, while it does feel all doom and gloom with the share price, the replacement cost of the project is north of $250m, with almost 5m ounces in MRE to accompany it.
- Forums
- ASX - By Stock
- PNR
- Ann: Quarterly Activities/Appendix 5B Cash Flow Report
Ann: Quarterly Activities/Appendix 5B Cash Flow Report, page-50
-
-
- There are more pages in this discussion • 3 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add PNR (ASX) to my watchlist
(20min delay)
|
|||||
Last
12.5¢ |
Change
0.005(4.17%) |
Mkt cap ! $806.7M |
Open | High | Low | Value | Volume |
12.0¢ | 12.5¢ | 12.0¢ | $461.0K | 3.772M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
3 | 180042 | 12.0¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
12.5¢ | 1387864 | 7 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
3 | 180042 | 0.120 |
12 | 828291 | 0.115 |
19 | 1654688 | 0.110 |
18 | 1697224 | 0.105 |
21 | 1721248 | 0.100 |
Price($) | Vol. | No. |
---|---|---|
0.125 | 1387864 | 7 |
0.130 | 7468122 | 37 |
0.135 | 2827070 | 11 |
0.140 | 1112719 | 17 |
0.145 | 1592119 | 8 |
Last trade - 16.10pm 09/10/2024 (20 minute delay) ? |
Featured News
PNR (ASX) Chart |
The Watchlist
AHK
ARK MINES LIMITED
Ben Emery, Executive Director
Ben Emery
Executive Director
SPONSORED BY The Market Online