mmn still sliding short sellers, page-9

On the one hand you advise that ATV are going to raise cash in December when gold is trading at $1200 and also hedge at that price and then you advise that MMN's investment in NGG is not liquid under the same circumstances! If gold is trading at $1200 in December as per your scenario please provide your reasons why NGG producing at 40K oz per year at cash costs of US$350 would not be trading at four times its current share price and be a liquid investment valuing MMN's investment at around CAD$36M? It seems you paint a pretty picture for the ATV scenario but not for the NGG scenario to suit your bias!

Now lets go through the March quarterly report!

Silver produced - 73,000oz
Silver sold 17,000oz (proceeds $270K or $15.88oz)
Total Cash costs - ($3.95M not including the $270K from silver sales)

Now lets translate those figures into the June quarterly!

Silver produced - 100K oz (assumption by me of a sligh increase on the March quarterly)
Silver sold - 156,000oz (Includes the 56K from march qty)
Proceeds from sales - (AUD$2.8M) (Assume average price AUD$18)
Total cash costs - $4M
Proceeds from sales of ag - $2.8M
Cash burn for june quarter- $1.2M approx
Add 30% for contingencies - Labour /fuel costs
Revised total cash burn - $1.6M

Using the above calculations and using a $4.5M cash costs per quarter and an average silver price of AUD$18, MMN would be csh flow neutral once producing 250,000oz silver per quarter noting that they would no be paying any tax.

Things do not appear to look as dire as you assume! Noting that I spoke to MMN a number of months ago complaining that they were wasting valuable funds on exploration/drilling at Talley ho they advised me that they were not concerned about cash burn.

Obviously the June quarterly will tell all! The odds of MMN being closer to 20c than closer to 8.6c by the end of July are quite compelling!

DYOR.