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
gold & producers up ... mun down 12%, page-8
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