a sucker born every day, page-4

Lol.... just back from holidays, feeling good and thought I'd take out the trash before getting started.

Astounding price action for a Zombie company. You know about zombie companies right? Made famous in Japan during the 90's when companies with huge debt but no chance of paying it back were kept alive by their creditors for the benefit of their creditors, keeping assets alive and bad debt off the balance sheet. CMR is operating in the short term soley at the whim and for the benefit of the creditors while they see what the plant is capable of producing. Can't die wondering if it works or not this close to full ramp up.

Meanwhile CMR is burdened with AUD$85M con note debts (Cornell US$30M, HNC US$10M and GT AUD$23M). Annual cash outgoings circa $8.5M interest, $10M admin and exploration etc and $63M as their share of operating costs for a total of $81.5M or $6.7M per month. Revenue at nameplate and current pricing is $48Mpa or $4M/month but of course only producing copper at $18M pa or $1.5M per month (at best). Currently burning $5M per month until or if the cobalt-nickel production kicks in, then they only burn $2.5M per month. Oh and don't forget CMR plan on paying back Cornell at the rate of AUD$3.5M per month on top of that!

How will the market take the plant being put on care and maintenance in the new year? Obviously still a lot of believers who think that HNC will swoop with a quick mercy killing takeover but I'm not so sure. IMO they will keep CMR on stand-down life support while the DFS takes it's course over 2009 and convert the con notes into sqillions of shares including more equity issue for ongoing costs. HNC has their foot on CMR's throat and no-one else will come in and make a play for their zombie!

Cyclopes, I note your sentiment has dropped to hold. Taken the rose coloured monical off have we?

goodluck