big c, page-6

I have just had a look at the report and presentation and heard the webcast.

Negatives
1. less Gold this qtr (but guidance has not changed)
2. rain has impacted access to mine and exploration programme
3. C1 for this qtr is 70.3, up from 43.5
4. C1 guidance is now < 70 (was < 60) due to AUD and diesel.
5. Diesel costs are 25% of mining costs, and diesel has risen 7% from qtr to qtr

Positives
1. Initial inferred resource for slightly more than half the ore body of C is 2.7mt of Copper + gold + U + Silver
2. Ankata decline is on time and budget
3. Record high copper and Gold prices for the qtr
4. Copper price is projected to remain high for this year and next before falling in 2013.
5. A mining study is being conducted between Malu and Ankata (Munda Zone) in 2011/12. This is a very large area of predominately Gold
6. C indicative schedule is at least 6 years away.
7. C1 cash cost in AUD terms (other than diesel) has not moved
8. Plant performed well last qtr

Other comments

An analyst visit next week at P Hill will detail the exploration programme being undertaken.

My takeaways
1. I can see a growth pipeline developing of maintaining P Hill production, adding Ankata production late this year, adding Munda production in 2 to 3 years, then adding C production in 6 to 7 years.
2. Sandfire was not mentioned once by either TB or the analysts. That was interesting
3. No major comment on Cambodia.
4. No discussion of debt. TB indicated all capital and expenses could be funded from cash flow.

HT1