Stock Research Floats Anvil Mining Limited (AVM) Investment...

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Anvil Mining Limited (AVM)

Investment Summary
Company Profile

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For more information on what a Blue Book is, please click here. Core Commodities Copper, Silver
Price (as at 03-Sep-04) $0.44
Market Cap $103.6M
Cash (as at 2 June 2004) $10.6M
Cash / Share $0.05
Turnover (pa) $40.3M
Status:

Summary activity for the current quarter Quantity Budget
Soil/Rock Chipping 2,500 $0.01M
RAB 0 $0.0M
RC/Diamond 2,000m RC & Diamond $0.15
Assays 450 $0.02M
Geophysics Induced Polarisation $0.08M
Other Research $0.01
Total Expenditure $0.27M

Top Shareholders
First Quantum Minerals Ltd 17.10%
Commonwealth Bank 4.1%


Dikulushi Mine (Stage I)
Location Congo (DRC) The Dikulushi mine and processing plant produced 7,730t of concentrate during the June Quarter at an average grade of 41.25% Cu and 1,212 g/t silver. The concentrate contained 3,189 tonnes of copper and 301,315 ozs silver. The cash cost of production was USc55.4/lb payable copper (after silver credits). The company experienced mining contractor problems which are currently being resolved.
Commodity Copper / Silver
Qtr Production 3,947t Cu Equ (-1.5% QoQ)
Cash Costs US$0.55/lb (+ 20% QoQ)
FY Forecast 17,000t Cu, 1.3Moz Ag
Reserves/Resources [email protected]% Cu, 201g/t Ag
Dikulushi Mine (Stage II)
Location Congo (DRC) The commissioning of Dikulushi Stage II began at the end of August 2004 and will increase production by 50% to 20,000 tonnes of copper and 1.8Moz of silver. Benefits of Stage II will be: a) an increase in plant recoveries from the current 70% to approximately 92%; and b) an increase in concentrate grades from 39% copper and 1,000 g/t silver to over 55% copper and 1,700 g/t silver.
Commodity Copper / Silver
Style Vein/Shear / Structurally Controlled
Best Intersection 25.4m@12% Cu,404 g/t Ag
Kapulo
Location Congo (DRC) The Kapulo prospect comprises 3 medium to high grade fault controlled deposits, each about 300m long. Exploration work by Simkat around 1916, and Falconbridge in the 1970s indicated a resource of 1.1Mt at 4.7% copper. Anvil has initiated an exploration program with the building of a base camp and other works. An RC drill program of 4,000 metres will commence mid-2004.
Commodity Copper
Style Vein/Shear / Structurally Controlled
Best Intersection 36.5m @ 6.98% Cu
Aegis Equities Comments
Projects: Dikulushi mine production for the March quarter was affected by an interruption to mining by a military incident nearby unrelated to the company. Also, silver grades and ouitput were lower. Overall cash costs were kept at reasonable levels due to a higher copper head grade of 7.85% Cu. Copper production was right on target at 3,365t. Silver production is forecast to increase as mining moves to the higher-grade part of the pit. Stage II is about to enter commissioning.
Potential: Dikulushi has potential for deeper, high grade extensions, that could be mined underground. Potential also lies elsewhere in the large, 1.5km x 8km section of the Temba Fault Zone, host to Dikulushi. The vast concession area offers significant exploration scope, including the Kapulo deposits, which lie along 40km strike of a North South fault line. This fault has significant potential for finding similar prospects to Kapulo, and will be evaluated this year.
Overall: The restructure of Anvil in conjunction with a C$7.0M IPO in Canada was successfully completed in early June as planned. Anvil is now listed in both Toronto and Australia. This is well timed, the company making a record profit for the March quarter of $3.5M and commissioning Stage II. Cash flow should increase substantially in 2H04 with the capital outflows for Stage II at an end and production running at a higher level, aided by a strong copper price and an unhedged position.


Share price performance

Source: Bloomberg


www.anvil.com.au
Company Contact -
Bill Turner (President & CEO)
61 8 9481 4700



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