Banter and general comments, page-39116

Within the Charts thread uranium69 noted:

• better start praying for lithium price to go back up....
• within 6 months if lithium still havent recoverd..
• cxo cant reopen back mines...
• so they force to do cap raised... or sell it...
• this is a dangerous gamble...
• but... if lithium recover.. then its all goid

This is better suited to general banter not charts so I've shifted where I reply. My view is that with respect, Uranium69's post contains inaccurate assertions.

In the last quarter Core had cash outflow's of $30.4m across all the types of cash outflow. This split was:

• 71% Production costs
• 13% Staff, Admin and Operating costs most of which are likely to continue
• 6% PP&E, Exploration and Evaluation costs
• 3% One-off return of Government funding (Hydroxide evaluation?)
• 6% Lease payments related to mining gear that is likely to be mainly returned and have costs end (until a restart).

The biggest cash drain was production costs. Having gone into C&M Production costs will collapse to low C&M levels. This will mean most of Core's cash outflow's in June will disappear in the September quarter. Core's cash balance of $87.6m will last for a much longer period multi-year period, not the 6 months Uranium69 suggests.

Core has already stated that the restart capex for Grants is low so there is no forced CR to restart. You can never rule out a company doing CR's but if the restart decision is done in a period of improving prices, Core would be quickly cash flow positive and therefore could restart could occur with minimal working capital. Core has previously shown it has the relationship with Yahua to arrange a prepayment so that would be another option.

or sell it
I suspect Core has received low-ball offers for its Uranium resources and they have decided its worth doing some more low cost exploration to further define this resource and through that, either confirm its sensible to develop or enable the sale of Napperby at a better price. While a lot of holes are likely to be required to further define the Napperby resource, page 7 of the 12 Oct 2018 update noted the average depth of current drilling was 9.6m and the maximum depth was 17m. Low cost drilling options like Auger drills were being used. If these depths continue, Core can get dozens of holes for the price of a single modest length RC/DD lithium exploration hole. The yellow area is considered likely to be uranium mineralised but the drill spacing is too wide to define a resource.