Amerigo Resources Ltd T.ARG

$5 million write down

[TimeTooSoar]

Anyone know why there was a write down of $5 million this quarter. If there wasn't the write down this quarter would of been huge. Now instead of growing cash last 3 months they are $1.4 million less in the bank account.

[goldens]

Could have been the pumps and generators they bought in case flooding ever happened again. Next quarter will be huge and will include a positive from the settlement increase prices. It was smart to write it down now.

[Thestockguy]

I am not sure to what you are referring.  'Write downs' are accounting entries and while the affect earnings, they do not affect cash.   Are you talking about the $5.773M (non-cash) Depreciation and amortization charge?    This charge is the highest it has been in the last year or so.  Howevewr, it is not meaningfully so.  (It has been at or above $5MM

[TimeTooSoar]

Yeah it's the non cash charge. It's not explained in the financials as to what that is.  You think or know it's the depreciation of the plant?  I know it's a non cash charge i just find it hard to believe the results were so bad. Copper price they got is $3.95/lb yet they only paid dividend, a bit of debt and had a negative cash draw in the 3 months.  I remember the

[goldens]

It is not disturbing and in my opinion this was all related to the flooding that occurred. I think they explained it in the last quarter's report. They even said there would be some carry over. Don't forget the contract bonus ate into profits this time around as well. Next quarter will likely be more normal.

[harvester]

There's also NCIB in the mix

[TimeTooSoar]

Not until they have $25 million in non restricted cash. Thats why a solid 3 months and a cash reduction is not good... 

[goldens]

They had $13.8 in March and based on their settlement prices they will pick up at least $6.3 from this past quarter which would mean over $20 million based on settlement of past production (read the report under significant items). They will likely have the $25 million before the end of the next quarter based on currrent copper prices. The $25 million was also a number they were comfortable with