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Malaga Inc MLGAF

Malaga Inc. is a mining company. The company, through its subsidiaries operates tungsten mine and gold plant with mining and exploration activities focused in Peru. The operations, exploration and development activities on the Pasto Bueno Property are located in the Ancash Department, Central Peru. The company also owns and operates in a hydroelectric asset. The company owns 100% of the property, including all surface rights. The company processes the ore from its own mine.


GREY:MLGAF - Post by User

Comment by SimplyTheFactson Mar 28, 2012 3:27pm
238 Views
Post# 19729608

RE: RE: RE: RE: RE: Don't get it.

RE: RE: RE: RE: RE: Don't get it.

Because no one I know thinks prices will go higher than $500 MTU in the near future, and most analysts think $500 is an opportunity that needs to be taken advantage of, by increasing production to as much as you can to increase revenue.

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Let's take a look back, China imposes quotas on Tungsten being exported out of the country and price of Tungsten triples, reaching $500. MLG finally manages to become profitable, not by any earth shattering number, but by 5.6 mil. Now if we want to double or triple revenue and get the stock price to fly, we need to increase production... please understand that prices have already tripled and are not expected to rise indefinitely.

.

Further more, we wake up tomorrow and see a headline saying China has decided to remove the export restrictions, and the price of Tungsten has fallen to $150 MTU overnight... Therefore, you would expect a company like MLG to take advantage of what has happened to prices, and increase production to make a lot of money for as long as the opportunity lasts, which is what MLG is trying to do. But there was competition from other mines in the area for good laborers, they payed better wages, so and MLG lost workers.

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Consequently MLG raised their wages and improved working conditions for miners. But the two subcontractors which were supposed to hire new employees could not do so, therefore a new mine manager was hired to deal with the situation. On another front, today they mentioned permit problems also contributed to the loss in production, but I have not checked with the company as to what they were. Anyway, as I said previously, if they fix these problems and increase production, the stock will do just fine.

Simply

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