RE: RE: Great News!!!??? Hello ch08532, and all my other friends on the Silvermex Board!
I'm still around ... but just as frustrated as I was when I owned Great Panther before its breakout! I guess as the months and years go by, I believe more and more that there's so much manipulation at all levels of the market that little fish like us are dominated by bigger fish that bend the market to their advantage. And then there's always that Vampire Squid out there somewhere, although profits from manipulating SLX wouldn't cover the cost of free coffee at one of their large offices.
So, we've seen the drill results and the financials. I must admit, due to Spring chores, I haven't studied them as carefully as I would like to. However, my first impressions were not all that great. Let me explain:
- Considering the number of employees (what were there, five geologists alone), sales for 2011 of $16,8 million isn't very much. I realize all the problems the Company has had to surmount, but the market(-makers) only really care on the final results.
- Net Loss improved to $3.4 million - well, that's still a loss.
- Cash costs were $8.67 per ounce of silver net of by-products. I'd be interested to know what the cash cost was per actual ounce produced period...
- The La Guitarra mine and plant output was optimized at its maximum rate of 320 tonnes per day. That means for Sales to increase substantially, either: a) La Guitarra's mine capacity must be increased, which probably means major capital outlays and/or b) Rosario comes on line as a major producer.
- The drill results at La Guitarra seem to indicate pretty narrow veins - i.e. good numbers when you hit the vein, but is it enough?
Now, please don't think I've lost faith in the Company. I haven't! I'm still in there as a shareholder, but it seems to me that a lot more water will pass under the bridge before we get back to $1. I could be wrong; indeed, I hope I am. My confidence in Duane and his team hasn't changed - it's just that the following quote doesn't light any fires for me:
"We will concentrate on the development of these new ore shoots to improve head grades and production. Our primary focus for 2012 will be on developing a new mine plan that can expand production well beyond our current capacity."
It's all good stuff and the right way to go I guess, based on my limited knowledge of the facts. But it tells me we aren't "there" yet.
Somewhere I read that the Company's assets were valued at around $71.2 million. Based on the number of shares out (287,7 million) that equates to about 25 cents a share. Mind you, there's a lot more to a company than the assets that are accorded a dollar value. Still, we are still in the early stages of this Company, and I am not expecting any great change in the share price for a while yet.
Let us hope that I'm just an OLD skeptic, and unable to see the treasures buried below the ground and behind the financial figures!
Sunwood