1. All the problems are at Nifty. They are short term production problems and have sharply impacted cash.
2. 32% reduction on head grade of copper. Stuck with mining old area for a reason I don't follow but which are probably reasonable. There are good ores waiting to go in a number of directions past the Indian mess, resulting in a fall of 34% in copper production over same period last year.
3. On top of this a 44% of copper produced was not sold, or was not yet paid for? This resulted in a substantial mismatch between revenue and costs. This is a pretty rare occurrence in miners. Id like to know more. Floods blocking roads seem to recall? Presumably the revenue for this copper will come in in the current quarter? This will boost cash sharply. Were they holding back for higher prices in a rising market? Not a bad punt if you can. The improvement in copper prices lately has been marked. 3000t @A$10k ton= +$30 million. That should keep the wolf from the door. But please, please do'nt this be a bad debt from the Indian processor.
4. On a positive note, a 53% increase in the price for what was sold.
5. Drilled reserves increasing rapidly of a much better average grade than the stuff that has gone through this half.
6. Plant is running continuously now but not enough feed yet? Cost of doing this substantial. The problems in the old "checkerboard' were obviously underestimated.
5.
MLX Price at posting:
85.0¢ Sentiment: Buy Disclosure: Held
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