kha341 wrote: Since weeks ago it has been obvious to the markets that management has to revise the 2015 guidance downward. Just a question of basic math. Now let’s do our math again with the revised numbers:
1) 2015 new production guidance = 6.500 tonnes
2) Production from Jan to May 2015 = 296 + 285 + 472 + 473 + 487 = 2,013 tonnes
3) Production remaining to be realized from June to Dec 2015 (or the remaining 214 days of the year) = 6,500 – 2013 = 4,487 tonnes or a daily average of ~ 21 tonnes per day (4,487 tonnes / 214 days) or ~ 630 tonnes for 30 days.
4) July’s production = 607 tonnes. We don’t know the number for June’s production, but for sure it has to be less than 607 tonnes. So let’s assume that June’s = ~550 tonnes. Both months production were below the required average of 630 tonnes.
5) So the production remaining to be realized from Aug to Dec 2015 (or the remaining 153 days) = 4,487 – 550 – 607 = 3,330 tonnes or or a daily average of ~ 21.8 tonnes per day (3,330 tonnes / 154 days) or ~ 653 tonnes for each 30 days from Aug to Dec , a number which is quite realizable in normal circumstances.
6) In other words, they are about 2 months behind (the original target of 7,850 tonnes would be achieved by the end of Feb 2016).
kha341 wrote:
As per the latest revelation by Mark Smith it looks like that the ramp-up is about 3 – 4 months behind schedule. There are maintenance / mechanical conveyance issues that need to be fixed. We should forget about a commercial production in Q3 as previously expected by management. Imho, it is unlikely that they will achieve commercial production before the end of Q4. So until then it would not be a surprise to me if the sp stayed below the $1 range. As I’ve said before my own target is 2016 (but that’s just me).
Furthermore with regard to the fact that Largo “is sticking” with the 2015 average production forecast of 7,850 tonnes (see quote below), I have to say that it seems to be an impossible task unless management also include the 1,032 tonnes produced from Sept to Dec 2014 in their numbers. Let’s do the math:
1) 2015 average production forecast = 7,850 tonnes
2) Production from Jan to May 2015 = 296 + 285 + 472 + 473 + 487 = 2,013 tonnes
3) Production remaining to be realized from June to Dec 2015 (or the remaining 214 days of the year) = 7,850 – 2013 = 5,837 tonnes or a daily average of 27.3 tonnes per day (5,837 tonnes / 214 days)
4) The average of 27.3 tonnes per day (required from June to Dec to achieve the 2015 average production forecast of 7,850 tonnes) is higher than the 100% phase 1 nameplate capacity of 26.4 tonnes per day.
5) Imho, an average annual production of about ~ 7,000 would be more realistic as a forecast for 2015.
…