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FML, FOCUS MINERALS LTD
flower
post Posted: May 1 2013, 07:18 PM
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In Reply To: arty's post @ May 1 2013, 06:32 PM

QUOTE
Of course, you're right to some extent. Management should have been expert enough to foresee the price development, both in terms of their production costs and revenue. It's OK for you and me to hold different opinions of where the pog is likely to move to; we don't own and operate a gold mine. If Managers and Directors of a mining company can't do any better than we can, the least I'd expect from them is some decent risk assessment and mitigation. Even if they had been in your camp, expecting exponential growth to $3000/oz, almost two years of it NOT getting there should have rung alarm bells and sparked preventative/ mitigating action much sooner.


Hi arty, of course the POG in AUD played its part, IMO the opinion that Bill Beaumont (MD of NST) voiced several weeks ago when he started to talk about NST's total production costs instead of just cash costs should have indeed rung alarm bells in our ears as traders/investors, but more importantly in the boardrooms of all gold producers since at some point the punters were going to wake up to the fact that many goldies simply put are going broke, no board member likes to admit that especially in public and they have attempted to hide behind the publication of just "cash costs"---and we started looking at Q reports much more closely (hopefully).

Now we are all awake and digging much deeper into what makes a successful gold producer, those boards who have been within the law but less than transparent are going to find shareholder support suddenly vanishing, and I know everybody expects the AUD to fall, but right now just cannot see that, thus the AUD POG becomes of great concern to all "just viable" goldies who will now find their funding doors slamming shut, none more so IMO than the pure gold explorers.




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Combining Fundamental comments with Fundamental charts.
 
arty
post Posted: May 1 2013, 06:32 PM
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In Reply To: flower's post @ May 1 2013, 04:42 PM

With respect, flower, the pog does come into the picture:
If your long-predicted $3000+ per ounce had come true, they'd rake in the profits even at $2500 production costs.

Of course, you're right to some extent. Management should have been expert enough to foresee the price development, both in terms of their production costs and revenue. It's OK for you and me to hold different opinions of where the pog is likely to move to; we don't own and operate a gold mine. If Managers and Directors of a mining company can't do any better than we can, the least I'd expect from them is some decent risk assessment and mitigation. Even if they had been in your camp, expecting exponential growth to $3000/oz, almost two years of it NOT getting there should have rung alarm bells and sparked preventative/ mitigating action much sooner.



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I trade daily, but I am not a licensed adviser. Whether you find my ideas reasonable or not: The only person responsible for your actions is YOU.
I follow two rules: (1) There are no sacred truths. All assumptions must be critically examined. Arguments from authority are worthless. (2) Whatever is inconsistent with observed facts must be discarded or revised. We must understand the Market as it is and not confuse how it is with how we wish it to be. (inspired by Carl Sagan)
 
flower
post Posted: May 1 2013, 04:42 PM
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In Reply To: arty's post @ May 1 2013, 10:15 AM

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Another one bites the dust as low gold price makes mining uneconomic


HI arty, with respect the low gold price had very little to do with its demise, the real reason was their diabolically high cost of production.

FML had the staggeringly high total cost of production of $2408 an ounce, given the AUD POG today is 1421 surely blind Freddie could have seen this coming, once again it highlights the absolute imperative necessity to only be involved with ASX gold producers who have total cash production costs of $AUD1000 or less, or they risk going the way of FML.



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Combining Fundamental comments with Fundamental charts.
 
arty
post Posted: May 1 2013, 10:15 AM
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Another one bites the dust as low gold price makes mining uneconomic.

QUOTE
By Rhiannon Hoyle SYDNEY--Australia's Focus Minerals Ltd. (FML.AU) said Tuesday it will shutter operations at its Laverton Gold mine in Western Australia as margins are being squeezed by an increase in costs and a slide in gold prices.

The company, which is majority owned by China's Shandong Gold Group Co., said its decision to stop mining at the site came only after processing gold there turned "commercially unviable." It added that it intends to focus on exploration work, but will be conducting reviews on such progress.

The price of gold is down about 12% on the start of the year and earlier this month plunged to a two-year low as investors exited the market in hopes of better returns elsewhere.

The Laverton complex, an open pit mining operation that produces gold at an annualized rate around 100,000 troy ounces, was acquired by Focus in October 2011 after its takeover of Crescent Gold Ltd.

"We are not about to deplete our current reserves base just to break even," said Focus Chairman Don Taig in an emailed statement.

Focus will in the meantime assess possible asset purchases to build its portfolio, he said. Several producers, including the world's largest gold miner by output Barrick Gold Corp. (ABX), have signaled a willingness to sell operations in Australia, underscoring the shift by major mining companies to focus on a smaller group of more profitable assets.

The company is examining "opportunities for acquisitions that could underpin and improve the existing operations and enable Focus to move to a lower cost base with improved scale and productivity," said Mr. Taig.

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

April 30, 2013 04:14 ET (08:14 GMT)







--------------------
I trade daily, but I am not a licensed adviser. Whether you find my ideas reasonable or not: The only person responsible for your actions is YOU.
I follow two rules: (1) There are no sacred truths. All assumptions must be critically examined. Arguments from authority are worthless. (2) Whatever is inconsistent with observed facts must be discarded or revised. We must understand the Market as it is and not confuse how it is with how we wish it to be. (inspired by Carl Sagan)
 
mcart117
post Posted: Feb 17 2013, 10:01 AM
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In Reply To: mcart117's post @ Feb 17 2013, 01:26 AM

Just fleshing out my last post a bit, according to page 4 of the last full annual report:

http://www.asx.com.au/asxpdf/20121026/pdf/429q40lxhbzd4j.pdf

They produced 176 k oz for revenue of $258.3m, so they received about $1467/oz. GP was $55.6m implying COP about $203m or $1153/oz. On
Friday gold closed at 1610 after bouncing off 1600.

Obviously I don't know the COP of what's in the resource table, nor can I predict the POG when it come out, but I still think the SP on this one is a bit harsh.



 
mcart117
post Posted: Feb 17 2013, 01:26 AM
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Another of my dismal performers, and their latest announcement was pretty disappointing:

http://www.asx.com.au/asxpdf/20130205/pdf/42cvncyt8sg244.pdf

But if you read past the loss for the first half it says: "Focus has cash and equivalents as at 31 December 2012 of $225.8 million".

And at Fridays close of $0.029 the MC is only $256m!

According to the quarterly report for December:

http://www.asx.com.au/asxpdf/20130131/pdf/42cs1knzx4nwvt.pdf

They've defined a total resource of 4.27moz, which at the current share price is being assigned a value of just $30m, or $7/oz. I know the POG is falling, but will it really go that low?

 

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shooter
post Posted: Jul 26 2012, 01:08 PM
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I wouldn't want to be holding this before the quarterly!

"Next quarter" I hear the punters say "next quarter".............

 
diana
post Posted: Sep 17 2011, 09:32 AM
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In Reply To: gottsy's post @ Sep 16 2011, 07:24 PM

Hey Al

Yes I read that announcement. I think they must be confident of getting the 90% for compulsory acquisition and must have brokers working on clients or some such thing to inspire yesterdays price action. Anyway, it was great to see some life in it.

R/Di



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gottsy
post Posted: Sep 16 2011, 07:27 PM
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In Reply To: diana's post @ Sep 16 2011, 01:47 PM

Sorry should be Hi Di

 
gottsy
post Posted: Sep 16 2011, 07:24 PM
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In Reply To: diana's post @ Sep 16 2011, 01:47 PM

Hi Hi,

I think the latest announcement was saying we will hve about 85% with the loan conversion and about 60Million shares still out there not in the hands of Stone.
Cheers
Al

 
 


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