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clock Created with Sketch. 19/09/16
17:41
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Originally posted by eshmun
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I think a little trading/investing discipline needs to be applied in this situation."Annual group gold production for FY2017 full year is expected to be 135,000 ounces at an AISC of A$1,050/oz" and Sept quarter guidance expected at 31-35,000 ounces at an AISC of ~A$1,100/oz. Taking in account existing hedging and the gold price for the quarter the margin on production we should receive if guidance is met should be at minimum A$501/oz and probably closer to A$570/oz if the company equally divides the remaining hedge at $1601/0z over the next 6 quarter to Dec 2017 and one assumes production maintains a mid range guidance of 33koz over all 6 quarters as well (and this doesn't include the higher value hedge at $1,830/oz). These margins are well ahead of many of RMS's ASX peers and in theory the Sept quarter and the full FY2017 production should be enviable periods when figures are compared (if guidance is achieved).RMS's share price this week has been sold-off over and above its peer group.
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Solid analysis Eshmun - good post - think you have it covered. Call me naïve but I don't think it is (1) (so far I see management as having played a fairly straight bat) and that would really have serious negative long term implications for the company and management - and not really in the (2) box either but never rule out entirely the unsophisticated "sophisticated" investor (though this sort of makes RMS look a bit silly as well in terms of their choice of placement). I think it might be more of (3), I'd be interested to a do an analysis of volumes traded to see whether the recent placement shares might have been traded in whole or in part across the period as a driver of the decline (as this would presumably see a decent spike in volume) and also to see how easily manipulated the share price might be by a determined player.
(20min delay)