In the June quarter AUZ had postive cashflow of $0.6m based on 445,000 lbs at a realised price of A$12/lb. AUZ is now unhedged. Assuming the same production and same operating costs, based on a current nickel price of A$20/lb (currently A$20.70) AUZ would generate additional operating free cashflow of $3.56m or over A$4m in total for the quarter.
Even before today's announcement mine life was expected to be extended beyond August 2007 ie at least 5 quarters of production remaining.
Then there is the deeps drilling and today's announcement.
If anyone knows of another company with such leverage to the nickel price please let me know as I think AUZ is in a pretty unique position of unhedged exposure to the current nickel price with significant exploration potential and a small market cap creating significant upside potential.
My view is the current share price is way way undervalued after today's announcement. Might take time to get on the register of investors, and if today's drilling is just the tip of the iceberg then it should be a multi bagger.
Just my opinion
Monty
blair nickel mine exploration update, page-5
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Last
0.7¢ |
Change
-0.001(12.5%) |
Mkt cap ! $9.789M | |||
| Open | High | Low | Value | Volume |
| 0.7¢ | 0.8¢ | 0.7¢ | $10.88K | 1.542M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 23 | 4483283 | 0.7¢ |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| 0.8¢ | 4518809 | 16 |
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| Last trade - 12.30pm 30/09/2024 (20 minute delay) ? |
| AUZ (ASX) Chart |