Yeah did speak the Nathan a week back, in response to a WTF emailed in frustration, and was told, the drag on the sp was linked to long term finance and once resolved, we'd all be smelling like roses again......
What to think.
All I know is what is reported. If they meet projected outflows this qtr, and come out on near cashflow neutral with about 16mio development costs serviced it means they have a healthy cash flow positive operation. Notwithstanding all the positive cash goes to paying down debt, but that is mostly gone this time next year.
Based on my calcs, this time next year they will have paid the Taurus debt and 50mio of the Gerard debt down with a bank balance of 15mio at the end, and another 50mio of debt to service,. That is a net debt position of 35mio.
The key to this is the following three assumptions:
1. Spot copper must stay above 2.70
2. Production at or near 28kt
3. Outflows per qtr on or near 26mio.
It can be done but it will be close. Long term debt consolidation takes the heat out of the repayments, but the sadistic part of me would rather take the year of short term pain and get this debt down by 100mio. You don't have to be a rocket scientist to realise that late Friday's action was orchestrated. The only thing holding the Tgs share price up was retail investors who weren't scared off with the sheep. But as of 3:15 Friday they were either in the pub like me or lost in a shopping centre with no f8ckin idea what to get their missus for Christmas....
The trades atm are there to scare you into liquidating. If you are smart you'll hold out or buy. These cants are doing this to take the company down or come in the cheap ass take over. I think personally it is the perfect storm of general market sentiment, tax selling, and the fact these guys have played it close to the wind. If they pull it off well all be nominating them for the miners of the year. I suspect they will make it. I saw NST drop from highs near the 1.40s down to the low 40s on low gold sentiment and a couple of dodgy qtrs of reporting. They are now back in the 1.20s and were as high as 1.80 a little less than a few months back.
Remember this, it can turn the other way just as quickly as it has dropped and those same idiots shorting to make the half a cent margin will be racing to close out their shorts. Gltah
TGS Price at posting:
9.6¢ Sentiment: Buy Disclosure: Held
