Ann: Change in substantial holding, page-7

tpf - The worry is that as explained by the last announcement, debt payments are quite big and yet, for now Deflector costs are going to be high in the near term (prob much lower in the first half of 2018) as they are still doing a lot of development drives. So.. you have Andy Well making no money, deflector making perhaps $200 an ounces whilst the development is ongoing, and debt to be repaid of at least $5m a quarter (if not more, I am unsure of the exact amounts, as DRM removed all the broker reports about 2 months ago). Yes, they have $26m in cash/dore, but... how much of that is actually accessible? Then you have the cost of closing down Andy Well, plus the ongoing care and maintenance, all while Deflector is still developing.

It would seem, when I look at the past 10 announcements, that while green shoots were appearing at Deflector, Andy well destroyed all that, plus Gwaneeda proved to be nice, but... not enough for Andy Well.

So.... as I see, its going to be a close thing for DRM to meet all its obligations near years end. Now.... if they could renegotiate the debt, the equation would change dramatically, but... no mention of that in the last announcement... the bank is perhaps not so understanding now.

DRMs E/V is right now, approx $92m, cheap compared to almost everything I can see against the market, but that is 100% because of 2 things, the debt and Deflector still being somewhat unproven.

I guess I am starting to look at DRM like TRY... and all I can say is, that I thought an E/V of $100m for a decent producer was the bottom... well, I was wrong, more like $50-60m (which makes me think that DRM could get down to perhaps $0.15 before selling exhaustion sets in). Even BLK is heading towards this too. Scary.... The market is truly hating underperformers (which is fair enough). As all of the 3 stocks I mention are likely to need more cash, and... their share prices are being absolutely hammered.

Andy Well ASIC costs are hard to predict, other than being high... how high?? big question.
Deflector ASIC next 2 quarters, I am guessing $1400 per ounce, but... would be a huge issue if higher than that.

Sigh. So sad that DRM has fallen so low. Whilst some have been blaming the new MD, almost all of these issues are not his, but... Mr Kelly's IMHO. The real situation needed to be explained to the market and the MD has done that. Hard, but I think it worth at least saying that I think he has done the right thing, and I give him credit for being so upfront with the market.

I have to wonder if some sort of corporate activity might be possible in the months ahead. DRM is struggling and there are quite a few cashed up mid tiers like SLR and RMS... whilst I am guessing Eshmun would not like such a move, DRM has two mines currently yet is valued at peanuts.

Good luck to those buying or holding. Its going to take nerves of steel to stay on-board.