Good afternoon
a dog which barks does not bite? Soybeans and a few hundert mill$ of LNG, and no tariff on cars?Looks good for now - but will these agreements last? I doubt it...he will bark again!
Understandably, equity markets show relieve today....
Facebook is getting a hammering on disappointing outlook...taking tech stocks around the world with them.
Uranium is talk of the day amid Cameco´s extended shutdown of it´s largest mine.
Macquarie has appointed Shemara Wikramanayake as new CEO! A female running one of the best banks around - and a great person on top! Congrats to Macquarie, and especially Shemara!
Fortescue - things are not as great as they used to be...The company is still doing an extraordinary good job on the cost-side, but the discount on it´s iron ore due to inferior quality vs RIO and BHP is stubbornly significant...Comments from the new CEO also let the market believe, that there is no improvement in sight. This is not the time to buy FMG....
Independence Gold - their main asset is their nickel project - and they have cut reserves as well as grades to a mine life of 7.5 years now! This company has disappointed investors numerous times over the last 2-3 years...not one to hold, in my opinion!
Newcrest - I have to give it to them: This was a very, very strong Quarterly today! Cadia as well as Lihir and Telfer did better than expected - only Gosowong, which is not important any more, below expectations. Gold production at the upepr end of guidance, copper production above the upper end. ASIC of 795 A$/oz was positive as well. Lihir is now running at AISC of 724 A$/oz - that is a great achievement, and by June, the Cadia block cave operation was running at a 30 milltpa rate again. This Quarterly puts them back on the investment map! But I remain of the view, that Cadia needs to be accounted for at some discount, due to repeated, seismic activity. I am not an engineer - but could it be, that a 30 mllt block-cave operation is highly likely to be the reason for this activity, anyway? That´s a lot of rocks falling from the roof!!
St Barbara - production numbers had been known before - but the full Quarterly confirms, that the company has had anotehr outstanding Quarter - once again. Grades at Gwalia are fantastic at 13.4g - and this is exactly my concern going forward: The official reserve grade is 7.8g/t - and eventually, they will come back to that - or for a while, could even produce material below the average grade. We can all imagine, what this will do to earnings. I would like to stress, though, that the management is doing very well...producing gold from 1800m depth by decline at below 900 A$ AISC is just fantastic!
Oceana - and yet another company with a good Quarterly. 138900 oz at 696 AISC to generate 110 mill$ EBITDA and net profit of 44 mill $ is certainly positive. Strong exploration results from NZ had been reelased earlier. I think OGC have something left in them.
Evolution - the Sawiry family is reducing their 15% stake again, now to 10%. The bookbuild has been expected to be completed at a price of 2,78 A$ - that is an interesting level to purchase EVN again! Recently, and as I have written several times, the stock had run ahead of itself - but following this pretty severe correction, I am a buyer here. As Jake said recently: They have become the victim of their own success, where everybody expects the good things ( and only the good things! ) to repeat themselves again and again. That was at 3.50 A$ - at 2,78 A$, we are in buying territory!
Paringa - the new boss is trying to stear them into the reight direction again! Construction is making good progress now above, as well as below ground...There is enough money to pay for everything needed until Oktober, but by then, the main condition of the Macquarie credit-line ( which has not been used so far, and does not have to either until Oct ) has to be met: Additional forward sales of coal. The company expects these to happen within then next few weeks - but we have heard that from the previous management for a few Quarters - hence I am a little cynical about it. Fact is, though, that the market for their coal has dramatically improved over recent Quarters - coal stokpiles have been falling for teh first time in many years at this time of the year, as export markets are providing higerh prices and good demand. And gas is also not as plentiful, as you would expect. If the company delivers the mine as expected by year end, this stock is very cheap....But I want to talk to management next week.
Foran Mining - the boys from Foran have started their large, 26.000m drilling program. That´s the right thing to do - if you want to convince the non-believers, you will have to use the drill rig to show the value! This is a very important part of the feasibility study, and we should see results consistently over the next 2-3 month. I am always amazed, when companies are conducting relatively large capital raisings ( in this case, oversubscribed placement to raise 9.4 mill$ at 48ct ), and then you find absolutely zero aftermarket, even 10-15% below the placement price!
have a nice evening
WS
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