DE GREY MINING LIMITED (ASX:DEG) - Ann: Quarterly Cash Flow Report - March 2024, page-3 - HotCopper | ASX Share Prices, Stock Market & Share Trading Forum

Originally posted by Arh0070 ↑

Interesting to review the Quarterly cash flow reports and activities.
Point 1 ,cash flow .Cash burn rate remains at around 23 million per quarter which is basically for continuing operations with essentially zero being spent on equipment .The interest that they receive from thier cash balances from selling shares is around 4% ,the amount is their only revenue and will decrease as the cash reserves are slowly depleted.They barely have enough to support continuing operation for a couple of years which basically means that all plant expenditures will either have to come out of future borrowing or another equity raising (highly likely over the next two years) as I personally doubt that any bank will finance 100% of a mine .though banks are sometimes foolish with other peoples money so hard to tell.
Point 2 quarterly activities report .This report is of importance for what it doesnt say .It is apparent that permitting is not received yet and further information has been provided to the various government entities .There is NO indication as to when permits for construction of the mine might be received .Reading between the lines it is clearly not yet known when mine construction might begin in earnest .Seems likely to be August or later ,timelines have been inexorably slipping from prior estimates.It will be 3 years minimum to build the plant and get it operating profitably (to start paying down the bank debt),which will be the first priority.
POG down big time overnight ,interesting to note that the recent rise in the POG is having essentially no impact on DEGS share price as one would expect for a project years away from completion.
Point 3 the gold road /Orion situation .We dont know a great deal ,Gold road share price is down related to weather related events impacting gold production and the potential deal with Orion .Gold Road clearly wants more production and cash flow .If it indeed sells its stake in DEG it will be because it believes the deal with Orion is a better deal than spending the next 3 years or more waiting for cash flow from DEG .If it sells its 20% share in DEG to Orion ,I think it will be at a discount ,Orion is a sophisticated investor who has already helped bring another gold mine to production which is is now trying to sell to gold road (it has been for sale for several months).One can be certain that they will not overpay for the 20% of DEG since they would help finance the mine and then sell again (for a profit) when production is imminent .They are not operators.Interesting to see what (if anything )happens over the next few months .All will be determined by the numbers.Gold roads share price has not increased with the rise in POG and they are totally dependent for cash flow on Gruyère ,clearly they are attempting to diversify their current cash flow.Interest rates remain high worldwide making financing a mine difficult.
Just my personal opinion of course as a private investor.

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Gold Road could sell De Grey stake to fund Canada play

Analysts believe an equity raising is not the only option for Gold Road Resources when it comes to funding a $1bn Canadian deal.

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(20min delay)
Last $1.18		Change 0.010(0.85%)		Mkt cap ! $2.822B

Open	High	Low	Value	Volume
$1.18	$1.19	$1.17	$7.391M	6.261M

Ann: Quarterly Cash Flow Report - March 2024, page-3

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