Production Costs A lot of talk but little substance. Ajay55, you are 100% wrong! Welcome flagship61, but I hate to tell you that you, and your "analyst" are also wrong. rickless was the closest to being correct when he recalled what John G said in the last conference call. Then the net costs excluding by-products as I recall him saying as well was something around 50 cents a lb for Copper. I think he was ball-parking that estimate though in the Q & A portion.
Cobalt pricing has caused the net costs to rise from the original financial model forecast of -29 cents to a positive cost factor. I believe the conference call updated the costs to something around 20 cents, at that time. Check out the presentations on the company's website if you like as there is dated but relevant information there. The markets are constantly moving so what was said a month ago is currently out of date. Keep in mind that prices are not stable. Even the copper hedged here was in a range to a high of $3.97/lb if memory serves me correct. That is for 50% of the copper production for 2 years starting in 2014. Current copper prices supported by a decline in the inventory should put continued upward pressure on the price. So if we sell the hedge portion at the high (rather than at the original model estimated price) and the remainder at or above current prices what is the net profit (not production cost) today. That is far more relevant that what the by-products make the average production costs to be. What is the net after tax revenues per share. Then for idle conversation you can talk to whichever analyst or "Fund Manager" you wish to ask about the off-take agreement potential, including manganese that is due to be updated in Q3 of this year.
$1 per share being a risk to a new investor? Yes it is IMHO! It might go down to 90 cents because of this Proxy battle and MM manipulation. It will also be worth not less than $2 at some point in the next 9 months and unless taken out by MK or someone else, at a premium, it will be worth multiples of the current price in time. To quote John G. - "pick the multiplier of your choice" when he felt the market norm was between 8 and 15 times and he estimated the production value would be as high as 80 cents/share. I'd get a 2nd opinion, or do some of your own DD before getting others to do your homework flagship61!
Have a great weekend all. Should be more boring trading to watch again next week here.