woteva mate , a mate of mine held around 750,000 CTO shares six months ago. he also had had a long chat to management, an hour on the phone discussing various things.
Feeling comforted by this friendly upbeat chat he held on for a while longer until he ran into me. I asked him what gold stocks he was holding and his head dropped in shame as he confessed it was almost all CTO.
So we talked a bit about the issues of narrow reef mining, the poor regard for management blaa blaa. The only positve was that Towsey obviously was a capable guy who knew plenty about mining gold. The negatives are a page long.
he quit 500,000 shares at 15c a few weeks later thank god. Maybe you were the buyer !
Under 10,000 ounces per quarter this operation is barely breakeven at AUS1200 gold
The cash costs are only half the picture. the other half is that capitalised costs/lease commitments and admin/exploration run at $5million per quarter . So at 10,000 ounces per quarter( which is the best they will achieve view as I dont believe thay can bulk mine a 60cm reef grading 12ishgpt without serious dilution) then you add $500 an ounce to the quoted cash costs circa $500 and voila its costing them $1000 an ounce cashflow to stay in business at 10,000 ounces per quarter
Thus the 8.5c price as the market has twigged this is now simply a high risk leveraged play on the gold price
Better form elsewhere even at these prices.
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