hill end's cashflow

After previously making a guess about Hill End's expected cash outflow for the next 4 Quarters - including the Dec '08 Qtr that we are currently in - I checked back over the last 8 reported Quarters of cashflow. From that I've concluded that taking the Sept Quarter's cash outflow and multiplying by 4 for an estimate of a year's cash outflow is probably a reasonably good estimate.

I narrowed the items considered down to the operational costs of a) exploration, b) development, c) production, and d) admin. I did that for convenience, and because costs for other items tend to be low and more optional. They will probably be accounted for by rounding up in this rough calc.

The only relevant Qtrs to consider turned out to be the Sept '08 Qtr, and the June '08 Qtr, because this is where the cost itemised against exploration/evaluation ramps up after the gold plant gets into gear.
As a side note, the cost itemised against exploration/evaluation is really mostly for development, which for some reason is left blank. Anyway operational cashflow for all these items is $6,700,000 in the June Qtr, and $6,483,000 in the Sept Qtr. So I think an estimate of $7m X 4 = $28m cash outflow for the next 4 reported Qtrs is a reasonable guess.

I think we can throw out their estimated cash outflow for this current Qtr of $4m, because their previous reported estimates turned out to be hit and miss, with the misses being way out. For examples: in Mar '08, est cash outflow for the upcoming June Qtr was $3m. Actual was $6.7m. In June, est cash outflow for Sept was $4m. Actual was $6.5m.
So we can forget their estimates, and best guess by me for cash outflows for the next 4 reported Qtrs remains at $28m, to be funded one way or another, through production, financing, or cash at bank. Cash in the bank being a very healthy $7.5m at end of Sept Qtr. Bit of interest from that too.

Based on opaline's expected tonnages through the plant after ball mill and cone crusher upgrades, and with good reason to be optimistic for higher grades than 23g/t, as more high grade ore is accessed and less development ore used, then meeting costs from production seems doable. That does assume, say, 300 days a year of plant operation. Also if you're optimistic about the $A gold price for 2009, which I definitely am.