smh news pdn faces cash crunch by christman, page-6

@wipper

so you call this AGE report worth the ink? Interestingly.

From the AGE article by Ker:
>>The uranium miner Paladin is in a more difficult position, with $125 million in bonds due to mature just seven months from now, and just $US96.9 million in cash at last report. Paladin had a $US120 million loss in the six months to December 2011, and with uranium prices recently slumping to a multi-year low, the company is discussing asset sales and other options to enable it to meet its debt obligations.<<

The $120Mil loss included US$133M (post-tax) impairment cost associated with the write down of the Kayelekera Mine assets that occurred in the quarter ended September 2011. When Ker cited the cash position of $US96.9 million from the financial report 16/05/2012, he conveniantly left out to acknowledge the cash flow report just above the cash position:
>>Cash Flow:
- Positive cash flow of US$62.1M generated by the Langer Heinrich and Kayelekera mine operations for the
nine months before investment into working capital required to support higher production levels and
payments for administration, marketing and non-production costs, exploration and net interest paid.
- Cash outflow from investing activities slowed to US$5.2M in March 2012 quarter with completion of
construction required to expand production capacity to 8.5Mlb.
- Cash investment in working capital reduced to US$18.6M in March 2012 quarter, down from US$63.1M in
December 2011 quarter, mainly for additional finished goods stocks required to meet firm sales commitments
of over 2Mlb for the June 2012 quarter. No further significant investment in working capital is expected once
the operations reach production design capacity.
- Positive cash flow from financing activities of US$135.7M for the nine month period ended March 2012
attributable to the drawdown of the Langer Heinrich Stage 3 project finance facility, proceeds from the share
placement and after scheduled repayments of the Langer Heinrich and Kayelekera project finance facilities.

Moreover, Ker forgot to mention that PDN had no trouble to raise $274Mil through Convertible Bonds at 6% as outlined in quarterly report on 13/07/2012.

What uranium prices is Ker talking about? The spot price or term price? Again, Ker should have read the quarterly:
>>The Ux spot price remained in a narrow range during the quarter on comparatively low volumes.<< PDN sells most of its stuff into contracts. >>The Ux term price increased US$1.50/lb U3O8 to US$61.50/lb U3O8.<< PDN reported another record production (2nd quarter in a row) with a very positive outlook as stated at the end of their quarterly:

>>Outlook1
The re-start of Kansai Electric Power Company’s Ohi No 3 & 4 reactors and the creation of a new nuclear regulatory
regime in Japan signal the slow resumption of nuclear operations in that country after the devastating incident at
Fukushima. Japan still has 48 nuclear power plants off-line and it seems likely their progressive re-start will be slow but inevitable as the country faces severe shortages of electricity. Global uranium production growth has slowed significantly in the last year, suggesting that future supply constraints will still have a significant impact on the uranium market as the world nuclear industry regains confidence post-Fukushima. Production in 2011 was 53,494tU (WNA data), which was a very small decrease on 2010 production of 53,663tU. Kazakhstan was again the number one producer at 19,451tU, raising production by 9% over 2010, which was a considerable drop from the 27% increase recorded in the previous year. Kazakhstan’s production increase offset falls in Canada, Namibia, and Russia. Total world uranium production is still below world uranium demand, a situation likely to persist for some time.

To sum it up, Ker just picked the numbers that fit into his dodgy piece of scaremongering. He had all the necessary information to give a balanced report about PDN's situation. Yet he chose only the BAD INFO. Why is that?

That is why I call his piece rubbish and downramping.