buy time, page-176

Tooli I have some sympathy with you position but have questions on some of the detail. You say that SLR burnt $17m last quarter - this is true from pg 6 of the last quarterly, however the components of the cash burn are unclear to me and may not be net outgoings over the next quarter. These are:
1. Capex ($6m) includes relocation of power equipment from the Murchison and the NCM payment for Majestic of $1.025M - say $2m total
2. Care & maintenance ($6.3M) was a one off payment of $4.7M for redundancy & $1.6M for Lakewood - this item should not be there in the next quarterly.
3. Working Capital movement ($8.4M) consists of outgoings of $2.5m (bullion) and $5.9m trade creditors. Hopefully this will not be repeated in the next quarter particularly with 3,588 ozs of bullion refined and not sold on hand.

In short SLR should be better off next quarter by about $16.7m making them about breakeven over the month if the PoG stay roughly the same and the benefit of existing bullion (worth $5.28m) in hand (i.e not sold) should make them cash flow +ve (just).

Agreed they will have Capex down the line but there should be a lot of pressure to cut their cloth and keep their head (just) above water - danger is PoG goes down further and US$1,180 PoG is broken or the A$ appreciates.