Let's get real hereFollowing the shut down imposed by the Covid pandemic starting in March 2020, TMAC receives a lowball bid from SD Gold at $1.75 which is announced with Board support in May 2020. In a middle of the pandemic shareholder vote, 97% of shareholders voting approved the sale.
TMAC is obliged to cut back activity at the mine site to a bare minimum during Q2 and Q3, and has continued at this "on hold, wait for the deal to close" basis in Q4. Underground exploratory work, underground ore extraction, milling and refining were all cut back, and the volume of gold produced and sold fell to baseline levels.
So how did the Company do under this minimalistic approach? It generated a consistant after tax profit of $0.13 per share in both Q2 and Q3, and a positive cash flow each quarter of $26 million. So let's assume the Company continues to chug along in this "idling" state for Q4, and Q1 and Q2 in 2021, and generates the same results. It had $87 million in supplies and consumables stockpiled on site at September 30, sufficient to see it through operations until the end of Q3 without committing additional cash.
This will potentially add another $80 million in positive cash flow, and will have generated a 5 quarter after tax profit of $0.65 cents per share - for a share that you could have purchased today at $1.05 and which closed at $1.25.
And this is the cash flow engine that has a 25%-50% chance of going bankrupt in some poster's minds? I don't think so, unless our Board and management fiduciaries are total idiots, and criminal in their intent. They have had over 8 months to consider a Plan B for the debt rollover as a contingency if the SD Gold deal fell through. Time to pull it out while tere is still 6 months in hand and get a decent solution on the table.
Long suffering TMAC shareholders are waiting to see their well compensated leadership demonstrate they are up to the task, and to do so quickly, IMHO.