Hey Bly,
You jump around a lot between forecast and actual data which makes yours posts a little harder to follow so i'm open to be told i'm reading you wrong.
Is the issue you're seeing with BSM that at nameplate it won't be covering the costs of the ongoing business or that it won't fund the exploration and additional investment? At name plate they are pulling 1,500 tonnes of graphite. Taking into account only ongoing business (removing Exploration & Capex) the running costs of the business are expected to be $2,050,000 for the September quarter. Meaning to break even at that rate the graphite would have to be selling at $1,366 per tonne. Per the announcement on 23/08/2018 the BOD is expecting a bag price of USD1,051 which at todays rate is $1,563.
I have to take managements expertise at face value because i can't claim to be better at their job than they are. So by that average expected bag price they will cover expenses at name plate when everything is running smoothly. We know production is in a ramp up phase as shown by each report coming out. Sales are tracking up, prices are tracking up, quality of the graphite is tracking up and cost of production per tonne is tracking down. We also know we aren't there yet (hence the convertible notes to fund operations) which is the risk associated with investing in a company like BSM. We are trying to predict an event which has so many variables.
Now push into that equation the expenditure of exploring and capex - they are trying to increase the attractiveness of the mine to investors by growing the resource estimate and trying to increase production by installing various parts of capex towards stage 2. Can the current operations fund that? No. Can it be funded by issuance of shares and notes? Yes. Do management think they are closer to profitability and no longer needing further debt to fund operations and instead go after debt just to grow operations than we think? Maybe, impossible to tell.
A small mining play isn't something you value on historical data because you would never invest in a miner ever again. They are loss makers for many years before turning a profit while establishing the mine. You value a miner based on future potential, and eventually future probable income. It really is a toss of a coin. If they secure funding to get through this period until the ongoing operations fund both the current operations and future growth they will do very well. If they don't they could very well go into administration.
- Forums
- ASX - By Stock
- Ann: Preliminary Final Report
Hey Bly,You jump around a lot between forecast and actual data...
-
- There are more pages in this discussion • 8 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add GW1 (ASX) to my watchlist
|
|||||
Last
5.3¢ |
Change
-0.001(1.85%) |
Mkt cap ! $11.75M |
Open | High | Low | Value | Volume |
5.4¢ | 5.4¢ | 5.3¢ | $2.902K | 54.21K |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
1 | 71428 | 4.2¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
5.9¢ | 726 | 1 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
1 | 71428 | 0.042 |
1 | 20000 | 0.040 |
3 | 52205 | 0.036 |
1 | 500000 | 0.035 |
2 | 50252 | 0.033 |
Price($) | Vol. | No. |
---|---|---|
0.059 | 726 | 1 |
0.063 | 1000 | 1 |
0.070 | 35121 | 1 |
0.085 | 50000 | 1 |
0.090 | 55000 | 1 |
Last trade - 10.50am 05/09/2024 (20 minute delay) ? |
Featured News
GW1 (ASX) Chart |