Ann: Strategic Review of Operations Underway, page-305

My opinion of GM is not back and white. Like most anything (even Donald Trump as POTUS), I CAN find a few positives, but overall, I believe that GM and the BOD have done a VERY poor job of maintaining shareholder value, and they don't appear to be very good miners, either.

The 2025 guidance isn't their only mistake, by a long shot.

I agree that the fact that they accomplished the CR is a good thing, but I can sell you a Tesla every day, if I'm selling them at $25K, instead of $70K. But......

The CR was at $0.40, but on 16 August, when the announcement took place, the share price was $0.545. More importantly, a CR like this doesn't happen in a minute. Assuming that this was closed in a lightning fast 30 days, the share price on 17 July, when the wheels of the deal would have had to start (and I'm guessing it was probably even a bit sooner than that, but I'm trying not to go worst case scenario), the SP was $0.945. You and I could have negotiated a deal for a $0.40 CR if we were dealing with a $0.945 SP!

I also have to wonder, though this is PURE SPECULATION, about why they negotiated such a deal (not the CR concept, but why they accepted so much less than fair value). Given the timing and the rapid descent in share price in the space of ONE MONTH, when clearly, the negotiations for the CR must have been taking place, were our managers letting their mates know what we were doing? Was someone inside the management/BOD structure whispering? Our bankers?

GM is also failing, rather spectacularly, as an actual miner. I also own PLS (in fact, I own MUCH more PLS than CXO), and have seen what the commissioning and ramp-up process can look like, so I do not expect them to wave a magic wand and start producing SC6 with 80% recovery, at nameplate capacity. I do expect that the numbers will improve, though. It's taken them ten months, now, and the recovery rates are still very poor. Furthermore, we improved our recovery rates by producing a far inferior product. The AGM Presentation from 24 November notes that recovery rate went from 46% to 59% (from March to November), but if you read the footnote, we were producing SC5.5 in March, while in early November, when we got up to 59% recovery, were were producing SC4.6. That extremely inferior product is not only going to fetch an even lower price, but we will also have to ship almost 20% more product (19.6%) to bank the same amount of revenue, and that will come with the added expenses related to moving (on site), trucking and shipping 20% more product. It's also an epic ESG fail, for those that care.

Here's just one example of what I'd expect from competent management, from a person that understands more than the average Joe (I've performed environmental and safety audits for major miners, including RIO and BHP, including when I worked for GHD) but has nowhere near the experience of a real miner. If you've spent a few months working on your much lower than anticipated recovery, and you know other firms have already been through this exercise, why didn't they just go find the metallurgists that successfully helped PLS or another mine that's been producing and overcome their initial stumbles, already, instead of tinkering with our apparently limited processing experience?

As a last note in assessing GM as a leader, I AGREE that, with a low product price, the wet season at hand and a ROM pad that can get us through, stopping early works at BP33 MAY have been the correct call, but without even assessing whether the costs of the decision (I will in a second), did they REALLY have to announce that on the last trading day before Christmas? That announcement couldn't have waited until today? BTW, the decision does come with two major costs, including the demobilization and remobilization (if we can get them back) costs associated with the subcontractors that have been pulled off, and also the potential revenue disruptions down the line. Don't forget that there was already a concern that Grant's Pit might run out of mineable ore before BP33 comes on line. The longer the delay in BP33, the more certain that such a gap will exist, and the longer it will be.

GM is not the worst leader in this industry. Fortunately for him, the 1MC management team (or are they the SYA management team?) have GM beaten for worst performance in the industry, hands down, and there are a few others that are very poor. I prefer to look at the firms up the ladder from us, which I would hope we're trying to overtake, rather than down the ladder, and if I compare this management team to those at PLS or LTR, it's not just that PLS/LTR communicate better and seem to have a better vision, they have been FAR superior at execution, which at the end of the day is what they can most affect, and why "they make the big bucks."

I still believe in CXO, which is why I still hold, but in assessing the investment, I see GM and the entire management team as a negative, in my SWOT analysis. Not so negative that I'm in the "GM must go crowd," YET, but if they don't start drastically improving their performance, soon, I can easily be swayed to join that camp.