Member Info for Iaintittle

What time do you reckon the bullion banks will try to drop kick the gold price today 14.30 or 16.30?

From Q1 RNS
Corporate Highlights at 31 March 2020
· Liquid assets (cash and gold) of $25m ($14m at end Q4 2019)
Cash of US$8m (US$9m at end of Q4 2019)
o 11,000 ozs of gold inventory on hand (2,900 oz at end Q4 2019) worth approx. US$17m at 31 March 2020 gold price
· Bank debt of US$34m, repaying US$6m + interest in the current quarter (US$40m at end of Q4 2019)

Cash and gold (@1545 oz) $25m. Bank debt $34m. Unless we have other assets or debts that we don't know about.....$9m net debt at 31st March. Monthly production of 10,000 oz at newly inflated AISC of $950 and sales at minimum $1660 is $7m pcm. Plus an extra million for the 11,000 oz inventory revenue (sales revenue above $1545 oz).... we should have been net debt free 5 weeks ago....... and could be net positive by $13m end Q2 with budgeted production and current gold price.

Ahh kkkrrr the Freudian spectre of 'Cashlow'.......
I think it would be dangerous to assume that a/ Cora can be taken out at a 100% premium and b/ That Cora don't have the cash to build a mine (whilst technically true). I understand that their biggest two share holders (Lord Farmer/Red Kite and the Quirk family, 46.7% in total) have stated a desire to take the mine to production and a willingness to fund a mine build (with lose change). The scoping study at Sanankoro suggests a $20.6m capex for 45kozpa production and a fcf of $19m with an IRR of 84%. The next year or so of drill/development work is funded so, whilst the size of this on its own doesn't set the world on fire, it will fund extensive exploration in the future. Don't get me wrong, I believe that there will be a link up between the two companies in time, just not yet. If HUM can pick up a project at AISC $800 for $10 per oz in the ground, great, I doubt Cora would sell for $20, even if it had one (when it has one).

Gold has reached all time highs in most currencies but not against the US$. It seems that the US$ and the bullion banks are still in charge as shown by the orchestrated drops that we continue to see, not least Friday.........the paper gold market artificially trades the annual gold production every day . the Q2 economy figures are going to be the worst in history, we have unbelievable unemployment, we have riots on the streets, we have some of the biggest companies in the world filing for bankruptcy ......is there a point at which gold disassociates itself from the $???

In fairness we are not likely to increase the LOM unless we do some drilling, which we have only just re-started after 15 or so months....... there was plenty to go at 18 months ago; depth at Gonka and other project zones open at length and width ...... now that we have the cash to invest in drilling, I hope that we will move ahead with pace and increase our resources and therefore LOM.

Simple question. Hill and Betts have invested f’all cash in Hummingbird over the past years and yet invest in a business that they have spun off from the mother Co taking a good chunk for themselves...... what do they know that we don’t?

This worries me. I do not want to see the management of this project thrown in the direction of former East European block miners like Diamo who may not fully understand the profit motive or the urgency. On another level I do not want to see novel Czech processing get selected ahead of what Dorfner have achieved on our behalf unless we are certain that it is at least equal if not superior. In my opinion the Germans will have a significant part to play in the development and future of Cinovec. I don’t want the two nations to get into a pi**ing contest, they are mutually reliant in automotive at the moment. The Germans have plenty of ore on their side of the border, they could easily use their money to develop this with Poland as a parts production base and assembly in Germany..... sounds risky go down this path if that’s what CEZ plan

Interest no more that $5m @ 9%. So depreciation? Thing is, nobody seems to know what the policy is. As Dan said last year, the great thing is that we don't have a plan, we will adapt to whatever happens ....... in other words rudderless, aimless, hostage to fortune? I find it very frustrating and increasingly believe that he is running this company as a personal cash cow. What is not to like about a £400k package for a 3 day week + 1,300,000 penny options and not a lot of skin in the game to risk.......

Again, underwhelmed by a Hummingbird RNS.
Yes gold is rising and looks attractive but that is an external factor that is beyond our control, it will benefit all well run gold projects.
What I dislike is the continued stream of bad news against the smoke and mirrors of selected drill results (more later).
The company have just announced that the 2020 years AISC may be $100 higher than Q1 ..... ~$12 million extra in opex and it says this is caused by 'employment costs and logistics costs' due to Covid....' coupled with, potential, extra material movement later in the year as we look to take advantage of higher gold prices and re-sequence our mine'. ???? How much is Covid and how much re-sequencing? Is Dan now addressing the problem that he has with the pay dirt on the ROM pad that is earmarked for the wet Q3 but is only 1.8 g/t? If increased logistics costs refers to shipping dore to the refiners, the delays worked in our favour. We had 11,000 oz inventory on the 31st March and averaged $1568 for Q1. On April the 1st the gold price was $1568, 4 days later it was $1650 (and it has remained above this ever since) and since the 13th April it has averaged $1700. Besides which the refiners usually pay transport. What about fuel cost benefit of lower oil prices? Would like that $12m explained.
And then there are the published numbers. I am no accountant and I would love someone to explain them to me……. I don’t understand how we can pay off $5m debt each quarter and only reduce net debt by $8.4m unless we have taken out new debt?
We show an EBITDA of $54.5m, so after Interest, Tax, Depreciation and Amortisation we are left with $9.4m?? is that right?
Next gripe, the rolling mine plan, the LOM, when did this last roll? 'The Company has recommenced field exploration activities, initiating drilling operations on the 5th March.' In the 4 quarterly updates in 2019 there is no mention of any drilling apart from the 2018 program....... so around 15 months without a drill hole. In 2018 we drilled 28k+ metres, 2019 nada, recommenced on 5/3/20 with a 14 hole program (guessed at 300m each = 4,200m)….. how will we increase the LOM without drilling?
‘The Company expects to produce in the region of 130,000ozs in 2020. The Company believes this will form a long-term average production level based on the impact of the second ball mill.’ (Q2 2019 Update RNS)…….. Feb 3rd 2020 RNS ‘5 Year Rolling Mine Plan’ 2020 125koz; 2021 120koz; 2022 121koz; 2023 100koz; 2024 108koz …. Are we going backwards? (And 3 weeks later the management get their 1p shares awarded ……..)
I don’t believe that there is anything of substance in the RNS to encourage anyone to buy these shares and there are some tough questions that need to be asked of management here; it is our company, where is all the cash going (did all the cash go), what are the problems (if any, or are they solved), when are the shareholders going to be given answers?
All on the Q2 performance now, news in 6 week

Interested to see whether we get a change of shareholding RNS corresponding to the two tranches of 2,500,000 shares that changed hands last week.

Turnkey, I don’t disagree that your view might might be correct but don’t you think that there are investors waiting in the wings to enter when this finally breaks 30p?

I drift from optimism to pessimism with HUM. I would be much happier if I knew that the seller was gone. I think everything is going swimmingly well but history tells me that I will be underwhelmed by the y/e results .... there will be something (investment in off beat N American zinc mine, hidden payables, gold sold forward, missing inventory, no extension to LOM) that will disappoint. What we really need is absolute clarity on how the company is going to use all of OUR money that the management are making for us (for which they are being handsomely rewarded) ..... Divi policy, share buyback policy, drill plans....... make a firm statement of intent.

Would love the annual report to state that all costs associated with the pit wall issues are now paid and accounted for......

What is more frightening to the VW hierarchy is that Tesla adopted the Chinese supply chain model years ago as they realised this would be the only way to compete. As a result it is Tesla driving their price down by playing a part across the whole supply chain (even recently saying they are prepared to become a miner). This leaves VW no option but to become involved in one way or another in a way that they are unfamiliar with .......

....and I remember the care free old days when you used to be able to go to a restaurant!!

..... and the Yanfolila plant was designed to be expandable. Options could be Sanankoro (single permit only) or also Tekeledougou which is only 6km away. There was talk also of building a concentration circuit at either of the above which would remove 95% of the waste material enabling supply of low volume high grade to Yanfolila (where the limiting factor is currently input volume) and reducing hauling costs. Costing around $20m the gold rich ore (minimum 1 oz/t) would replace paydirt at a ratio of 1:20..... extra CL tanks could be added onto the circuits to cope with the additional clean up.

The leading shareholders would not do a cash sale at 21p.
I understand SRK mandated the maiden resource to have a cut off of 1.6 g/t for 265,000 oz when that figure would have been over 1 million oz if the cut off had been 1 g/t ...... 1 million oz at that grade held in surface oxides with little overburden is worth what $40 an oz in the ground at todays prices? The scoping study released in Jan gave $19m free cash flow at $1,400 (or ~$30m at $1,660 oz) from a pre prod capex of $20.6m with an initial 5 year mine life. BUT, maybe a partial sale would allow for funding of future drilling and handsomely reward the shareholders whilst giving them a free ride into the future; that might be a win win, after all there are plenty of permits in the Cora stable.

Any deal to buy Cora would have to have the support of the two major share holders, Lord Farmer and the Quirk Family. They are both known to have invested some of their cash into this project at 15p. They are both known to favour taking this to production and are in here for the long game. I can’t see them agreeing to sell for less than 20-25p and even then, it would have to be a mutually beneficial merger not a fixed sale. I can’t see them being too encouraged by ‘merging’ with HUM as their objectives appear not to be in line with Dans. If it were another non Mali based West African producer then maybe, but not HUM.

Rick Rule has regularly observed that investment in PM’s, whether it be stock in miners or physical, represent under 1% of portfolios on average. If that were to double as people lose faith in stock, bonds, gilts, cash, banks etc what would be the consequential rise in prices?

I think that the 2019 results will be worse than many expect and I don't think that the street are going to like them and so I think that the company needs to demonstrate current upside to balance sentiment. There should be ~$46m profit after ASIC minus some central expenses and the biggy ........ 'trade payables' the undisclosed one off expenses that might have been associated with the pit wall disaster but were not included in the ASIC. But 2020 is off to a cracking start 'The Company's guidance for the calendar year to 31 December 2020 is to pour 110,000 to 125,000 ounces of gold and an AISC on gold dore sold of US$850 to US$895 based on spot gold price of US$1,350 and a diesel price of US$0.70 per litre at site.' the numbers greatly favour us.