Share Value I find this companys share value astonishing on many fronts. Management has obviously lost the respect of the street. The company has assembled one of these nicest pipelines of future growth potential yet its failure, to this point, to deliver shareholder value has left the stock price trading for a song.
Large capital outlays are required to bring all these projects on line on a similar timeline. The company has adequate cashflows from current operations to bring them on in stages oer a longer time frame.
The company's credit is outstanding. (reaffirmed recently)
Cash on hand, 1300 million cash less debt 1000 million
Cash form operations 1000 per ounce on 2.6 million ounces per year presently
Tasiast is huge. Has become a liability as opposed to an asset.
I think the company needs to evaluate under present conditions not off the long term plans set in motion years ago.
Fruta del norte if we presently make a 1000 bucks an ounce profit and it won't deliver that number shelf it till it does as buying back your own shares would get you 1000 per ounce profit without the risk.
On a total reserve basis this stock is screaming value. somebody posted less then 90 dollars per ounce in the ground.
Management needs to step up or out.
1) you don't leave your shareholders out to dry.
You added 9 months of time into the development planning stage. This may be prudent. May prove to save lots of capital and improve profitability and better metrics but in the meantime the company continues to genrate 200000 ounces of sales per month at 1000 gross margin. You have 200 million a month in cash flow from operations. At current share values you don't need to invest anywhere but right here in your own common stock.
2) I would commence an open course issuer bid to purchase back up to 10% of the companies float ASAP.
At these values no brainer. Each share purchased and cancelled would add significant further upside and value to the balance of the shares outstanding.
3) Make it clear to the shareholders no further dilution will occur. Management will look at other ways of raisng debt or asset sale to raise anticipated cap x. Silver royalty streams etc. Asset sale, forward purchase agreement on a mines output.
I think most mining companies benefit from having a strong share price and they can use their share value as a bank. Until that confidence is restored in this companies management team (todays or tommorrows) I think this company has shackled itself with doubt.
Assess as of today, you need to send a message to the investment world that the share value is paramount.
Those who invest and back this company will be rewarded through asset appreciation accreditive to shareholders not total ounces produced compared to its peers at all costs and risk. This isn't a race (ego) this is an investment.
The pipeline of projects is great, the value is great, cash from operations more then adequate. I don't think I want to see anymore investments from this team till the market maintains a minimum $15-$20 share price for the common stock. Study the aspects of the total capx for these projects with return rates etc and until then commit free cash flow to share buybacks!
IMHO