Ann: Production Ramp-Up At Thunderbird, page-9

Same insto that has been buying since 46c sellers came and went in some volume a few weeks ago is on the bid soaking up sellers, but I can't work out why? There was definitely a lift in HM grade from the pit based proven by maths on the HM assay process, which i had at ~15%, and mostly explained the recovery lift in product from the plant. Bruce refused to be drawn on the question of HM reconciliation vs DFS model (I asked that question in the webcast) but whether or not his mine geo's havenb;t worked it out yet, or Bruce is keeping that bit of good news for those inside the circle I don't know?

Point is I was expecting 85% of nameplate from 75% of u/size to the plant from lower DFS OS predictions, which is a plus and might go a long way to reaching nameplate with tweaks to the DMU, lower OS in future pits etc. That would also explain the insto bots all over the stock, front running retail bids with their invisible half cent off-screen orders, always pipping buyers at open and close auctions leaving some retail smuck to cop a 1 share hit etc.

Today's update is a shocker on costs regardless of how one might 'guess' at mine reconciliation without any mention of ore grade to go with product tonnages. Sorry... when management cherry pick data to release and keep critical data and commentary back it makes me suspicious. By my tables they are getting closer to 80% of Ilm product compared to nameplate for 1.35Mt ore, bit lower than 85% guided. Zircon is up closer to 95% maybe, but the question of lower ZrO2 in the con and thus higher tonnes hangs over the numbers (and might explain in part the lower than expected NMag zircon con pricing?).


That paragraph is the shocker... even if it lowers over time it remains wildly higher than expected. Take BridgeSt latest report which says "We have also taken the opportunity to bump up costs a little, reflective of the inflationary environment in WA currently.".. yet has ANNUAL cash cost (approx by op expenses) at $80M... $55M per Qtr x 4 = $220M annual vs $80M doesn;t even make sense... The DFS22 has annual site opex at ~$160M per year, so I'll assume Bridge has made the mistake of tabling half-year figures under full year headings??



Anyway, $220M vs $160M site costs opex is a 37% increase in costs, while the zircon con is now running at ~75% of DFS22 expectations. Fingers crossed that the AUD stays low, because if the USD eventually falls from grace but min sand products don;t reflect that fall with a proportional rise (reflecting instead supply-demand fundamentals in local currencies) then the 'jaws of revenue-cost' will be snapping shut...

Based on todays update KMS will be ~$20M cash negative on an operating basis, less other costs shuffled into capex, corp etc.. That can only go on so long until KMS bank is empty, SFX bank is empty and a CR is required. Fingers crossed for continue and better lift in production and lowering of costs...

GLTAH