Tahoe Resources TAHO

info for knife-catching people

[mingzhu]

"The agreement with a syndicate of lenders, which runs until 2021, has US$300 million in available credit, but borrowing is capped at US$75 million while Escobal's license is suspended.

Tahoe will be in default if that remains suspended on April 1, 2018, the company said last month."

"RBC Capital Markets analyst Stephen Walker said it could take 12 to 18 months to resolve the constitutional claim."

https://www.bnn.ca/tahoe-resources-shares-hit-all-time-lows-as-guatemalan-mine-licence-suspension-is-upheld-1.838952

[SKRiderFan]

That bit of news along with all the civil suits sounds like a kiss of death

[phil_t]

I saw that too, but maybe someone here can enlighten me as to what exactly they will in default of. their Q2 financials show only $35m in total debt outstanding, with $190m cash on hand.  Lenders may withdraw the credit facility which means they will not have the flexibility to access additional funds for development projects, but it doesn't mean a death spiral.

[Jigsaw]

At the moment I believe the vendors they deal with in Guatemala are not being paid, hence the default issue has arisen.

[BASTILLEDAY4U]

Phil, I see 190 M cash but also see Total Liabilities $ 474,912 M. 10. Of that, ACCOUNTS PAYABLE AND ACCRUED LIABILITIES = $109,941 M. >> 12. LEASE OBLIGATIONS = $ 15,946 M. This is some serious debt. Assets are worth whatever someone is willing to pay for them.

[phil_t]

Most of that is not the same as debt, which carries a fixed due date.  More than half of total liabilities is deferred tax which only comes due as part of income tax payable if and when you earn a profit.  The $109m in accounts payable and accrued liabilities is real enough but more than covered by current assets, which does not include the value of mines.