SP, I wonder whether Brazil has experienced severe cost inflation in the past 18 months? I recall TRY was forecasting very low cash costs for Andorinhas about the same time. The Brazilian real is currently very strong so that is squeezing margins.
I take your points, but I am happy that MUN hasn't diluted shareholders during the difficult times, which has been possible by operating in a relatively low cost environment; more expensive Australian operators have diluted shareholders terribly in 2008/09. That is evidence for mine that managers are taking a disciplined approach, looking after the shareholder base.
Right now I'd pay current prices for MUN's assets without even considering the cash-flow from Engenho. But yes, I'd wish they be more realistic with their targets with some margin for error factored in when inevitable issues, like adjustments for safety, arise.
Rowingboat
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