Post by
production05 on Aug 29, 2014 11:32pm
A few highlights from the financials
The Q2 financials are now filed on SEDAR. I have only taken a 2 minute glance. One should review it in details to get a full understanding of the company`s business situation. Obviously, the company will need to work out financing in order to address the debt situation and surviving as a going concern. However, I progress with the Q2 financial and operating results puts them in more favourable position to strike some sort of financing deal with someone. I think NWM has been addressing the cash shortfall by taking out demand loans with the lenders. I think they took out another $500K demand loan in Q2. I think that makes two $500K demand loans thus far, therefore I think they now owe $1 million in demand loans. They plan on paying back the demand loans once they receive sales tax refunds from the Mexican governments. NWM is expecting to receive as much as $4.8 million in sales tax recoveries (or at least that is what they have booked in the financial statements as sales tax recoveries). NWM booked $869K in Interest on promissory notes (in the Income Statement). It likely means they made their interest payment on the debt for Q2. Of course, the $500K demand loan likely helped out with that. Generally, they had an improved quarter. Even with making such a huge interest payment, they still manage to realize a Net Income of $403K. Cash from operating activities was $864K. I think that is all largely due to operational improvements and finishing the upfront pit stripping work and pit enhancements (in previous quarters). The realized gold price was $US1,302 per oz while the Cash cost per oz was $US923 - a significant per oz margin improvement. It would be good for the manipulated paper gold price to finally go back up at least $100 or $200, say to $1400 - 1500. It would make a world of difference to these types of small producers. It`s just a matter of time. Q2 gold production was 4600 (4595 sold). The strip ratio improved quite a bit, to .86 (likely largely due to what I mentioned above). The mined ore grade was .38 - lower than previous quarters, but within the acceptable range for this type of heap leach operation. Let`s see if they can keep it up in Q3. If they can do it for a couple of quarters then, and the gold price remain stable, it will increase their chances of closing a financing deal, in my opinion. It looks like (very early indications are) the new operations team are understanding what it takes to get this mine to perform. Let`s see how they do longer term.
Comment by
babedinkleman on Sep 01, 2014 6:42am
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