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White Dam update



Fox-Davies retains a BUY recommendation with an unchanged target price of A$0.88 per share.

Exco Resources (ASX: EXS) last traded at $0.59, with the recommendation providing a potential 49% upside.



Exco Resources (ASX: EXS) has released its interim results for the first half of fiscal 2011 and also released the production figures for White Dam along with a resource upgrade.

These releases also coincided with a site visit to White Dam by Fox Davies personnel.

The interim profit was A$10.4M, very much in line with expectations given the quarterly production figures and cash flow statements that the company releases every quarter.

However, gold production at White Dam for the period January and February, at 19,378oz well exceeded our expectations.


The current quarter should be exceptionally good for ExcoÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s 75% owned White Dam mine.

With the gold loan now fully repaid, the mine should be receiving the spot gold price.

Combine this with production that is expected to be well above the 22.84k oz produced in the December quarter should see cash costs decline below the $246/oz recorded in the December quarter.

Regarding the presumed excellent March quarter, we certainly saw nothing to suggest that the excellent production achieved in the first two months of the quarter was an aberration.

It should see the cash on hand grow well in excess of the A$13.67M on the balance sheet at the end of December.

The result of this is that Exco will be able to continue its aggressive exploration programme in north-western Queensland and fund it all from cash flow.

These results, plus the expected developments at the Cloncurry Copper project put Exco in a very strong position.




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Well V1 that is a pretty compelling article to throw a few dollars at these guys and just hold for a bit..





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V1, the low cash costs is a big selling point in my books....





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Might be a little higher than that price if the story below has legs:








Alcoa, Alumina, Exco Resources Meanwhile, it looks like Minmetals' move on Equinox has also got the market talking about other potential plays in the sector. According to The Australian Financial Review, one possible deal getting some traction is one between aluminium giant Alcoa and its joint venture partner Alumina. Aluminium prices are expected to tick up in the next 12 months or so and the paper reports that Alcoa has the capacity to raise the money it needs to buy Alumina out of its 40 per cent stake in the Alcoa World Alumina & Chemicals joint venture. Elsewhere, WA-based copper-gold junior Exco Resources is also reportedly in play and has had an approach from an international suitor about two weeks ago.



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G'day Balance.


Been a while yep. SS wasn't getting much traffic for a while...I think I'll be back now.


How's things mate?




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trading halt flagged but not seen announcement as yet! V1


Ahhh still time to edit my post:

Expect Further announcement today to clarity FinC's post with media speculation etc in it!

Edited by veeone
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