Banter and general comments, page-38988

Those are cash costs. They will be low on restart because you have a pit with sloping walls. Each progressive layer lower in the pit has less waste to remove. Eye-wateringly high costs at the start (some were pumped into capex to mitigate these effects). Medium costs, low costs, super-low costs.

Core had to stop mining because of the mining schedule/weather. Cost wasn't the major factor but it was a convenient factor for management to blame. The market "high cost" position was also convenient while trying to do an excessively large, cheeky write-down.

Any good accountant will tell you that write-down's are done at year end, especially ones which may be taking assets below fair value. You still need to get the low value past the auditor, but there is no extended period you need to maintain that view. Close the accounts, develop a new strategy and the "worthless" asset that was fully written down can start having use again. The now departed ex CFO and GM decided to do a massive write-down at half year. This then required them to maintain the position that Grants had no value for another 6 months. Management and the Board having decided to do a massive 6-months write-down now have done what is necessary to maintained that position which is two fifths of nothing despite a share price that has cratered. The accounts will soon be finalised and you will start to see a different story emerging about how due to Core's restructuring efforts it will now be possible to profitably restart.

There's multiple examples of this write-down but I'll cover just one.

The Capex pre-strip element of the stripping asset
Core called $33.9m of mining costs pre-strip capex. Due to cost inflation the value was probably nearer $40m and I'm going to call it $42m for the nice around numbers that will create.

If you spend $42m of capex and get 2.1Mt of outputs, each output needs to be landed with $20 of costs. By the time you get the last of the ore out of Grants, then you have fully depreciated the pre-strip asset. With ~1.5Mt of ore remaining from open pit operations at Grants, there should still be $30m pre-strip capex waiting to be applied as a non-cash costs. Core has not just aggressively written down the stripping asset, they have written it off completely. If the auditor agrees, the new value from 1 July 2024 is $0.00. 100% of the costs of the pre-strip have been allocated to the first 0.8Mt of ore out of Grants. Because of this 0% of the costs of the pre-strip remain to be added as costs to the remaining ~1.5Mt of ore from Grants.

Its these write-down's saying no value exists when value does exist that is creating the oddities observed from management.