nice work brighter spark. I note all your numbers are in USD -...

nice work brighter spark. I note all your numbers are in USD - no conversion to AUD!! which is always going to be the contentious number into the future. Clever way around it! :)

FYI - they get a 4 year tax holiday.
- the SG&A is way too heavy - the BFS had included Admin in the operating costs. This is a company that has been parsimonious for many years - i would slash it and even it out over the years.
- they can easily add another year at the very least with existing resource using lower cut-off.

My NPV model come out at 27c, using POG1300 flat over 11 years, and at 10% disc. But now they have the mine nearly running its time to reduce the discount rate.

The Petra Capital 16/6 NPV is 27c
The Casimir capital NAV, is 17c using POG 4US950 and 5% and they have a 27c target.

As I have commented before these NPVs on their own don't give a true picture of the value of the assets.I like the mix of methodolgies as per Casimir or even that of Fat Prophets (buy at 15c 13 Oct'10) which have a open view on targets and look for fundamental and technical value.

I look at it from the viewpoint of NBV -the Net Book V.is $139m (1H10) - so the market is only valuing the gold at $30m +. I would argue that steady ongoing annual decline in gold production and gold grades will cause investors in existing producers to re-rate the value upwards. I have read commentary on the fact that the average gold producer will in future need to see sustainable POG 1400+ in the face of increased cost pressures.

Remember folks every $100POG is worth approx. 1.5-2c on RED SP.

And we have had plenty of these increments since BFS and the 17c cap raise