hI jOLLY, I just baught in here this morning! You are right, there are other smaller producers who are run better and are good value. BUT price to asset value is not such a bargain as this one, its too bloody cheap at this price !!! I know, I expect the asset value to fall as they do not maintain profit levels in the short term, however I do not see the asset value of this business falling below 600m. MEDIUM TERM this should at least double the sp. My views only, make up your own minds people! regards Jan
The Company has already implemented a series of measures which will substantially reduce the year on year expenditure in these areas, including: • A $50M reduction in our sustaining capital • A reduction of $25M in our exploration spend • $8M of savings in our corporate overheads.
I think the Chinese have there political calculations rather thane pure economical. I assume, they don't trust the US dollar anymore. They want to establish their rinmimbi instead of that as world currency. That's why they close those treaties with Australia, Russia, France, Brazil, Korea,Taywan, Japan, Iran to avoid the USD in the bilateral trading. Well, nobody accept rinmimbi in the form it is today. That's why they need a gold backed currency and that's the reason they buy desperately all the gold they can get. I also doubt, they get those amounts for the spot price. In the last year for the first time they lowered their exposure in US bonds and I'm pretty sure,this trend will accelerate this year. I think (hope), they will use the money they don't buy bonds for, to buy gold. BTW the same is going on in russia. I really think for them the price of gold or mines is not the most relevant factor. May be i'm wrong, it's just an idea.
This is my " dog-"well down on this one but strangely I don`t feel bad. It doesn`t take much to get my real dog to perk up wag his tail and bark the place down with excitement - might happen here so going to stay patient. In the meantime what I would like to know because I only got in after the failed t/o drop is if the supposed cost of production is known to be so high, why were the chinese considering buying it at 3 times the present sp ? They must have pretty much known that and I think the chinese are probably the last people to play games. Can always be wrong of course (( Any experts shed light etc. ?
Yes being a major company does not mean the costs are lower just a bit less risky with more resources and expertise to deal with issues etc. IIRC Allied had very high costs at its mines higher than ABG at the time so those mines currently must not be very profitable.
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