Dismal Failure Trevali is a dismal failure on every level. Zinc above $1.50 should be a dream come true for investors, yet the best the stock could manage was a pathetic CA$.26. No one trusts this bone headed management anymore. Look at some of the ways that bone headed management has failed investors:
- Costs out of control - As of the last 2 quarterly reports, the company needed $1.26 zinc just to break even. Mining costs are through the roof. Management is doing nothing to control costs.
- Bad hedging - Not all hedging is bad, but bone headed management hedged at a price that is currently giving them a guaranteed loss. The company needs $1.26 zinc to break even, yet they hedged at $1.23. Is locking in a loss a good hedging strategy?
- Caribou - Caribou was hedged at $1.25, and it is probably showing a loss at that price. Bone headed management missed their goals on Caribou, and now inflation is increasing costs even more.
- Reverse split - Bone headed management refused to do a reverse split because they have given up on the long term prospects for this company. Their gold is to kick the can for as long as possible while raking in their generous salaries.
- Treatment costs - Bone headed management was handed a gift on a silver platter with the reduction in treatment costs this year, and they managed to squander the money on their out of control mine costs.
- Development - The lack of development at the mines has led to the possibility that one mine will be shut down and is probably part of the reason for the out of control costs. Bone headed management failed to warn investors about the development problems just like they failed to warn investors about anything until the release of the quarterly reports.
- Share buybacks then dilution - Bone headed management was crowing about their share buybacks a few years ago. Then last year, after the price of zinc was already rising, they printed 243M shares and warrants to dilute investors by 30%.