looks like a good buy to me......shorters have put a cloud over it of late.... typical play ahead of any reporting especially if the suspect/know...a good report will be issued..... ------------------------------------------------------
A recap on news to date...... Today pdn +5 on 6.39 mill volume......xao +24.9 SHORTERS appear to given up ...the risk is NOW to high...... Thursday then Friday....Monday 16th ....shorters on a a knife's edge --------------------------------------------------------------------------------------------------------------- 1 Historical reporting dates 2 Increasing number of reactors being built 3 Q4 2011 31 dec REPORT SUMMARY and projections for Q1 report Jan to march 2012 4 PDN announcement of Possible deals with Uranium energy companies rattles shorters 5 India and china in the market for Uranium investments 6 Japan 7 The Pattersons report (tossed in the rubbish bin)***********************************************************
2 Increasing number of reactors being built It appears PDN management made a wise move signing up contract commencing 2012 for a sales price of MID to LOW US$60lb for a set 2.8mill/ lb
This still leaves them room to sell at higher spot prices as the total 2.8M/lb is slated to 2012 to 2016 They will not be committed to sell 2.8M/lb in any one year but are protected from any drops in price.
It appears the BUYERS forsee a big rise in prices and a decrease in supply,so they have locked in some supply to average down their overall cost if the price of uranium rises to the US$70 range and above.
THE BEST OPTIONS FOR LATCHING ON to uranium's gains are exchange-traded funds linked to the mineral, and the stocks of uranium producers.
Two prominent funds–Global X Uranium and Market Vectors Uranium + Nuclear Energy (NLR)—are respectively up 19.78% and 12.86% this year.
Shares of Toronto Stock Exchange-listed uranium producers are doing even better.
Both Paladin Energy (PDN.Canada) and Uranium One (UUU.Canada) are up more than 35% this year. "
.There are 61 reactors under construction globally, according to industry trade group the World Nuclear Association. 26 are in China and 10 in Russia.
The WNA adds that 162 reactors are on order or planned, with 51 in CHINA, 17 in RUSSIA and 16 in INDIA
slated to join about 435 operable reactors worldwide. At the same time, uranium supply is waning.
Beginning in 2013 , secondary sources of uranium—mostly from the decommissioning of nuclear warheads—may dry up, as a U.S.-Russia accord to dismantle such warheads ends, according to Australia's Bureau of Resources and Energy Economics (BREE).
Mine output WON'T rise fast enough to offset both HIGHER demand and lower secondary supplies, the government agency said.
BREE projects uranium consumption will rise by 5% to around 77,300 metric tons in 2012—and grow to 110,200 metric tons by 2017.
BREE sees global mine output of the nuclear fuel at 58,200 metric tons this year and growing to 86,900 metric tons, with prices reaching $74.20, by 2017
Most analysts expect the price of uranium to rise from current levels of $50 to $65 [a pound] to $70 a pound over the next two years," Global X's del Ama said. ..............................................................................................
3 Q4 REPORT Paladin Energy 14/02/2012 announces PROFIT US$ 3.2 million as at 31/12/2011 previous comparative quarter realised a Loss of US$17.5m
Sales Revenue increased 50% result of Higher sales volume av sales price US$52 lb compared to 2010 of US$50 lb av Dec 2011 sale price US$53 lb
new contracts ...commencing 2012 to 2016 pricing mid to low US$60 lb for 2.8Mlb (Pg2) A higher proportion of contracted deliveries are scheduled in the forthcoming 6 months to 30 june 2012 (Pg 15)
LH Stage one project finance repaid (US$24.8M)
CASH position 31/12/2011 US$128.8M
CURRENT INVENTORY (dec31) US$187.1M jUNE30 INVENTORY US$177.7M (pg42) revenue from sales of Uranium oxide US$172.7 up 51% revenue 6mths ended 31 dec 2011 US$173.4 up 50% from US$115.8M in 2010 (Pg 30) SALES to external customers dec 2011 namibia US$126.2M Malawai US$46.7M SALES to external customers dec 201O namibia US$92.5M Malawai US$22.2M
Net tangible assets per share US$1.46
LHM In Dec produced in excess of 90% of stage 3 nameplate production. Dec qtr production saw an increase of 40.5% over previous qtr and 33% increase on previous qtr record (Pg3) PAGE 12 QUOTES 40% increase and 92% of stage 3 design capacity Expected to ramp up to 99% in March 2012 (Pg4) LH cost per lb reduced to US$32lb compared to US$33lb in 2010 C! cost for the qtr decreased to US$31lb
KM plant Dec 256,026 lb produced up 60 % from previous qtr...12 days in oct 2011 plant was offline... production for the qtr was 77% of nameplate 631,780lb Nov and Dec record production months av 93% of nameplate (Pg5)
C1 costs in 2011 had decreased to US$46 lb as at 20/05/2011 but the KM product sold from inventory in DEC Qtr..it had been written down to to a recoverable value of US$52.75lb with a C! cost component of approx US$40lb (p14)
C1 cost increased from US$40lb in the qtr to 30 spt 2011 to US$46lb in qtr ended dec 2011 Sept Qtr production was lower due to plant shut down and inventory sold in Dec was mostly inventory held at 30 june 2011 (Pg 18)
BANKERS Tech test for 90days nov1 2011 to 31 jan 2012 have been passed (Pg6)
RECORD PRODUCTION AT BOTH SITES FOR THE DEC QTR
..............
GROSS PROFIT in 2011 was US$17m in 2010 it was US$11m (due to higher sales and lower c1 cost per lb
Total Comprehensive income to 31dec 2011 US$185.5m Total Comprehensive income to 31dec 2010 US$108.8m (Pg19)
CONVERTIBLE NOTES (Pg 45)
CONVERSION PRICES OF NOTES DUE 2013 US$6.59 DUE 2015 US$5.665
CAMECO AND PALADIN ENERGY ANGELA JOINT VENTURE ,NORTHERN TERRITORY PALADIN 50% CAMECO 50 % JOIN VENTURE MANAGER PALADIN ENERGY AS AT Sept 2011
exploration to resume approx june qtr 2012
So it shows that Cameco are on good terms and future deals cannot be unexpected.
THE IMPAIRMENT THAT SENT THE PRICE DOWN DUE TO IRRESPONSIBLE JOURNALISTS NOT REPORTING ALL THE FACTS THIS impairment is a simple devaluing of the plant and equipment due to the financial circumstances after the disaster in japan. when carried forward in the accounting the reduced valuation becomes a loss and consequently any REAL PROFIT appears to VANISH... THE REALITY IS ITS MAKING MONEY.... It all for accounting purposes and realises a tax loss on paper.
The journo failed to mention one main point THE COMPANY MADE A PROFIT AFTER TAXES
WELL I covered as many points as i could and probably missed many but there are 64 pages so go read it and enjoy.
The $120 million LOSS was an IMPAIRMENT cost associated with the WRITE DOWN OF THE KAYELEKERA MINE ASSET that occurred in the previous quarter ended sept 2011 The write down was considered NECESSARY as a result of the REDUCTION in uranium prices POST FUKUSHIMA Company recorded US$3,.2 m PROFIT after tax for the qtr ended dec 2011 COMPARED to a US$ 17.6m loss in the comparative qtr as a result of HIGHER SALESVOLUMES and PRICES as well as LOWER OVERHEAD and FINANCE COSTS
4 PDN announcement of Possible deals with Uranium energy companies rattles shorters then came the 11:30 report... 10 the april 2011
shorters then they hit the panic buttons......the buying started.....
they tried to contain the rise to protect their profits.....
with only 3 tradings days left in this week they have a TIGHT window to cover their shorts.....
Monday is the 16th of April so Q1 report historically can appear shortly after that date......
But now they have these additional problems mentioned in the report.... high possibility of deals with Uranium energy companies....
a MOU could appear at any time before June 30 and be signed ...but after June 30 for tax reason..if it involves pdn receiving any cash.....
......................
and the price keeps rising
the news today confirms what I have said in previous posts....
now the market expects an announcement to pop out of the blue at any time...
as for the ipo....well I expect it in the new financial years as per the timetable set out for global promotion etc....pdn won't want the additional TAX to fall in this financial year ending june 30....
Higher uranium PRICES the report stated.... and Pdn had at dec 31 2011 placed a lower valuation on its inventory...then valued at US$177.7M...and had fully costed its production into the Q4 2011 financials.....
well that sits well for the lower valuation of the inventory held at Dec 31 2011 ....
its sits well for the expected production increase at both plants.......
many uranium energy users very interested.... sits well for present and future demand for bigger orders....
so now the markets is expecting either some JV activity with new partners putting up larger amounts of funding OR some TRADE sales.......
these can come at any time.....out of the blue......so now traders have to be cautious about selling......
...............................................
5 Indian and China reported to be looking in Australia for safe supply sources
It was recently reported in the australian media that India and China are looking for safe sources or investments ....for uranium supplies in Australia.....
Now Pdn has stated that NUCLEAR ENERGY PROFUCERS are very iimpressed with PDN plants and its assets held in Australia and most probably also in Canada....
Areva is on the SMM QLD shareholder register with just over 10% of the stock..... Now with Labor in Qld gone and the LNP in power ....there now exists the real possibility the LNP with allow Uranium mining in Qld Australia.....
Canada ....the moratorium on uranium ...has been lifted and Rio just recently outbid cameco for huge Uranium Leases in canada
cameco is involved in a JV with Cameco ..with PDN being the manager of the project .....................................................................................................................................
6 Japan Japan....1 reactor still on line....other under inspection /repair/upgrading ..... Japan...Govt will consult with provincial Governors before re-starting reactors that are technically declared safe...... Japan...oil and Gas prices tooo high to NOT re-start Nuclear reactors..... Japan....if reactors are not re-started soon....power shortages will occur across all of Japan and hit industry .....facory output will drop...and eventually they will see staff lay offs japan....No Nuclear to feed power Hungry industry and Japan will face a TRADE defecit.....
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7 The Pattersons report (tossed in the rubbish bin)
Patersons...like who would listen to them.....
pdn has 1 year to pay down the finance or re-finance.....this downgrade sniffs of camel dung.....
have to wonder what goes through their minds when they put out rubbish like this.......
just go to the report dec qt4 2011 page 45 convertible notes
conversion price of notes
DUE 2013 US$6.59 DUE 2015 US$5.665 ........................................... 1 Pdn as at dec 31 2011 CASH POSITION US$128.8M Pg1 Current Inventory dec 31 US$187.1M
2 Sales revenue INCREASED 50% result of HIGHER sales volume Pg1
3 NEW CONTRACTS...commencing 2012 to 2016 pricing mid to low US$60 lb for 2.8Mlb Pg2
4 LH stage 1 financing repaid US$24.8M Pg1
5 A higher proportion of contracted deliveries are SCHEDULED in the forthcoming 6 months to 30/06/2012 Pg15
did they forget to read pages 1 ,2 and 15 and 45
believe that valuation and then put a tooth under your pillow and wait for the tooth fairy
PDN Price at posting:
$1.76 Sentiment: Buy Disclosure: Held
(20min delay)