RE:RE:RE:RE:Drop below $10,000,000 and AOT is done? If I read that rightcrazytimes wrote: wildhorse.... just can't see it going that way. Last insider report shows Ccori Apu S.A.C at over 120 million shares. They have two board members so have a good idea what's going on and no sales to show. In my opinion there will almost certainly be a financing coming, the only question is at what price? The real risk is it is a brutal below the market raise, but that looks more unlikely by the day. Hell, they could raise $60 mill just from doing an exclusive offering to current shareholders alone. Looks like today there was an agreed upon coordinated move to see how it trades freely. My guess is the financing is coming sooner than later. If I had to guess, it will be around $60 million at somewhere between .15 to .20 cents per share. If they are lucky it won't be as bad if someone gives them a little more credit. That will give you a dillution of say 350 million shares if all equity which is likely already priced in and more and maybe half that if they get an expanded credit line. No way they can just let this fold, not with such low debt and a billion dollar mill and 3 million high grade ounces. Fiduciary duty would come into play. Way too many other options. To be fair, I have been quietly accumulating down here last few days. Just my opinion.
Good post. Yes a lot of smart people and companies have invested a lot of money to get AOT to this point of having a refurbished mill that had been operating at capacity recently. They also have i believe it is more like 6 million or more ounces of high grade gold and a lot more to be found once they have money for drilling.
After several hundred million dollars of investment and years of waiting do all these investors want to throw the company into the uncertainty of a bankruptcy when they are so close to production with a good mill huge resources and very little debt?
At the current gold price of aprox. $2400 AOT should produce aprox. 180 000 ounces per year. 10% or so goes to the gold stream leaving AOT aprox. 160 000 ounces per year. Lets use an AISC of aprox. $1200 which is quite a bit higher than forecast. That would leave AOT with 160 000 ounces x $1200 per ounce profit or aprox. $192 million US per year in profits or aprox. $250 million Cdn.
AOT currently has a market cap. of aprox. $140 million CDn. At 8 times Cashflow the $250 million in Cashflow would equal an aprox. market cap. of 2 billion or a 14 bagger from here. Of course there are income taxes and other things to subtract from Cashflow although i am sure AOT has a lot of write offs and depreciation. Lets be conservative and use a possible 10 bagger from here in the next couple of years.
Its either that or AOT goes broke is sold for peanuts and shareholders get zero. Although on the other hand even if AOT were to go broke i doubt it would sell really cheaply as there are other gold miners who know what they have here. There is also not a lot of debt to be payed back so shareholders could do well even in the event of a bankruptcy.
I agree the big worry is a huge financing at these low shareprices. I would rather they borrow the money or as much as they can or even sell of a few more percent as a gold stream.
No current sharholders are happy with what happened here. Where they last 30 or 40 million financing from a month ago went so quickly i dont know likely paying off the last of the construction costs.
Now they have finished contstruction and have stopped operations as they would not have enough ore to feed the mill. The cash burn has slowed a lot and they have to regroup and get enough money so they can get to the ore and have money to start things up properly when they have enough ore for full production. The mill itself was operating quite well so it should not take a lot of money to get that up to speed when that time comes.
These junior gold miners are risky bets and everyone should know that going in. Trying to re build and existing mill and drill and produce ore in large quantities from deep underground in the middle of nowhere takes years and the company has no income other than what it can borrow or sell shares to raise during that time. Many if not most of these small companies either have a lot of trouble or go bankrupt trying to do what AOT has done. The one thing that saved them is that they already had a past producing operation with a mill and the mine infrastructure in place saving them many hundreds of millions of dollars.
These types of situations for people with the guts are where life changing money can be made or lost. $100 thousand invested in AOT shares at todays prices could easily be worth $1 million in a
couple years or it could also be worth zero.
You put your money down and you take your chances. Or you dont your call. Just dont do it and then whine endlessly if things dont work out as some here do.
Not to say that management here has performed that well as there have been a lot of mistakes and miscalculations. How do you plan to start up a mill when you dont have the ore to feed it and have to tunnel over a kilometer of hard rock to get to it? They have had years to prepare for the mill opening and they forgot about getting to the ore? Got to do a little better than that. I guess they were short of money so getting the mill finished was more important than getting to the ore. I think you need both.
After all these years waiting now that we are on the verge of huge profits i am staying put doing some trading of shares i bought lower while keeping aprox. 250 000 shares in reserve which i may add a bit to.
This is very likely my last investment in these types of junior miners.
Made a lot more losses than profits over the years with these companies and am getting to old for this nonsense. Hopefully i go out on a high note with AOT i think the chances are a lot better than with most of the broken down broke moose pasture "Mining" companies i have bought over the years. The only thing most of them mined was their shareholders pockets.
Good luck to all.