Wayne was raking in $865,000 p.a.. Truly astounding. No wonder he wanted to keep drilling for extra years without putting out a resource, eh? Well, at least he's gone - that saves the company nearly a million a year. Then there's Hutchinson's $650K p.a.. Lucky no bonuses were liable to be paid!
And at least these poor chaps are getting regular 3% p.a. wage rises. Take that, stagnant wage growth.
* $3.163M transport bill was paid by issuing shares. I guess if you forgot to budget for shipping your mill from China, you have to write scrip.
* SinoSteel can elect to take its fees (or part) as shares in lieu of cash for doing what it should have done if CDU had managed the building contract of the mill properly and had done the cabling better. It decided to take 5,666,666 shares for $8.5M
* 294,118 shares for $500,000 for the tailings dam.
So far, the company has paid $24M in invoices by issuing scrip (see pp 46). if anyone's going to whine about dilution, that's a good place to start.
* As said a few days ago, the $30M capital raising under the 15% rule, is before a vote for shareholdres to elect to exclude that issue from the 15% rule. As I said 2 days ago, this means they will want to raise more money - and there you have it; $30M to the mystery shopper, and another $63M in a non-renouncable rights issue at 1 for 4. Which because the timing is right, the mystery shopper gets to dip into the kitty again for another 25%! But it's pretty silly the company can't even name this company in the text of the Annual Report....almost as if they didn't know which shell company their benefactors were going to funnel the cash through before the Annual Report went to the (pdf) printers.
* Based on the impairment review at 30 June 2015, the recoverable amount for the Rocklands Project was determined to be $405 million, resulting in a provision for an impairment loss of $109 million.
* Total losses were $131M
- $109 loss on impairment (of which $60M was an impairment on the mill)
- $2.9M on logistical assets (whatever that means)
- $11M forex loss....which means they had an invoice in US$ and sat on it and the AUD tanked.
- $5.6M employee and consultant expenses(half of which is the Directors)
However, here is the kicker:
Furthermore, the Group's cash flow forecasts are based on estimates of future commodity prices and exchange rates. The Group has reviewed long term forecast data from externally verifiable sources when determining its forecasts, making adjustments for specific factors relating to the Group. Copper prices used in the model range from $3.40 to $3.90 per pound.
So, to derive a value of $450M, which then gives a mere $109M impairment on the value of those future cash flows, the company is using US$3.40 to US$3.90 per pound of copper.
The current copper price is close to $2/lb. So excuse me for being a bit picky, but how the hell did KPMG let them make this bold as brass assumption that copper would suddenly double in value on average for the remainder of the lift of the project going foward?
The assumptions are extremely heroic. I would even say implausibly heroic. Fantastical, even. Which means the cash flow models are based on complete furphies.
You will also note, the company does not have a Reserve. They don't even definitively know if they can mine anything for a profit.
This is C-grade at best. F-grade most likely. This is why you NEVER invest in a mine which doesn't have a Reserve. Lol.
- - -
$5M in inventory (ore stockpiles: Native Cu?)
$10M in nn-curent asset (ore stockpiles; must be oxide ore which is not current due to being untreatable pending the plant completion)
$600K in trade and receivables (GST refunds)
Total current assets: $6.4M
plus $30M cash = $39M
$40M in invoices due
$19M in short term loans (presumably including the $8.5M from Sino)
$58.7M long-term loans
Total Liabilities: $19M
* Short term loans totalling $8.33 million was received by the Company. These loans were arranged by the company’s major shareholders and are to be repaid from the rights issue or from future production. (this is as I said; the line of credit remained open from Sinosteel as they charged the company for installing cables and totted up an IOU).
* 19.9M of loans are classified as current (ie; within the next FY, ie $15M due April-May 2016) so $19M of the $30M raised has to go toward paying these off.
* The directors have prepared cash flow projections that support the ability of the Group to continue as a going concern. These cash flow projections are based on the successful completion of the Rocklands Project including associated infrastructure and commissioning of the Rocklands mine processing plant, with commercial production expected to commence in February 2016. (see pp 50)
So, who was saying divvies within the year?
CDU Price at posting:
$1.11 Sentiment: Sell Disclosure: Not Held
