Avocet Mining Share Discussion Threads

[mirabeau] 15/11/2013 08:03

I think the hedge buyback is excellent news for AVM

[nofool] 12/11/2013 11:29

Interesting. I wonder what you were saying when AVM was 3p..?

The inflation reports are certainly not helping the case for Gold.

[a.fewbob] 11/11/2013 00:41

Buying AVM now wouldn't be so much as like catching a falling knife but more like catching a grenade.... in your mouth!

[buywell2] 10/11/2013 23:28

GOLD is weakening

profit is wafer thin as it is re production costs

[cockneyrebel] 08/11/2013 14:55

Dump this pig and get into retail and related stocks imo.

CR

[a.fewbob] 07/11/2013 19:27

Fool,

Don't put the words hedge and AVM in the same sentance, it upsets people.

[nofool] 04/11/2013 13:39

Well, I'm building a position in AVM; as a hedge against the rest of the market..

and I bet I'm not the only one.

[thewileecoyote] 01/11/2013 13:13

Is it me or e every time AVM tries to break 17 it gets pulled down again for no obvious reason.... usual manipulation. ..but for how long ?

[drewz] 31/10/2013 15:57

Gold = $1550 by year-end, I expect.

[giant steps] 31/10/2013 08:26

Knowing Avocet's luck gold will probably plunge to $800 !!

[giant steps] 31/10/2013 08:11

Looks like a route to recovery, an overdue plan


edit : removal of hedge looks like a strong market signal imo

31st October 2013

[sos100] 31/10/2013 08:00

nice analysis there.

[polaris] 31/10/2013 07:46

So they finally exit the hedge costing another $47m. The total lost revenue as a result is close to $200m. It clears the decks of most of the issues except the Elliott loan, which is secured on the TRI-K assets and is due for repayment at the end of the year. I assume that AVM will be able to meet that and generate enough cash from exposure to spot in current Q to pay other costs. It will be tight as the Ecobank loan will take two repayments before year end and they need to ring fence two months of payments, totaling a little over $5m. If they mine 120k oz next year with a $200 margin on all-in cash costs then AVM can pay the loan schedule and cover corporate costs. They need to get costs down and also hope that gold stays above $1350 but it should be possible. I still do not see how they will fund mine construction at TRI-K but that is a while down the line. I'll not be buying but AVM may turn a corner now that they have removed the hedge millstone. Getting costs down to below $1000 will give healthy cash generation to expand exploration. Only a gold moonshot will give enough cash to fund the next mine development without outside further funding. Time will tell there.

Regards

Paul

[giant steps] 31/10/2013 07:10

The hedge is a strangle :

"
At 30 September 2013, the mark-to-market liability of the hedge book was US$46.6 million, compared with US$35.8 million at the start of the quarter, resulting in an expense to the income statement of US$10.8 million. Although the total ounces hedged decreased by 18,000 to 117,980, the increase in mark-to-market liability of the hedge reflects the fact that the quarter end spot price increased from US$1,192 per ounce at 30 June 2013 to US$1,327 per ounce at 30 September 2013.
"

[sos100] 31/10/2013 07:05

Refinancing & Tri-K

· Avocet poised to become a fully unhedged gold producer;

· US$63 million medium term loan facility with Ecobank Burkina Faso drawn down - no hedging required;

· Ecobank loan term of five years at interest rate of 8% per annum;

· Remaining Macquarie debt repaid during the quarter - entire Macquarie hedge position to be bought back shortly;

· Tri-K feasibility study:

- work to date confirms technical viability of low cash cost operation;

- mining licence application process commenced;

- government approval received for environmental and social impact assessment;

- key Koulékoun exploration licence valid for additional two years; and

- work underway to optimise project, including capital and operating costs, to determine project economics.

looks quite good from initial glance

[loverat] 12/10/2013 10:29

Sounds like a possible scenario but by no means inevitable or probable. I think perhaps kibes has the right idea to keep his options under review. Do not write off AMA and AVM just yet as things can and do change very quickly. DYOR.

[kibes] 11/10/2013 11:47

I did buy some of these for the recent run up but am out now. With the gold price below $1300 they are not making any money and if it goes back to $1000 they are dead in the water. Nobody is going to put up $88 million unless there is a recovery in the gold price. I'm ready to buy if circumstances change but far too risky to hold at the moment. I do think the gold price will pick up at some point but not until weak holders have been completely flushed out by lower prices.

[giant steps] 11/10/2013 09:57

Clearly the market is struggling to swallow the

"Capital cost, including contingency, of US$88.5 million"

given avocet history.

[sos100] 11/10/2013 08:08

might be other investments out there that might persuade you to be positive again?

[polaris] 11/10/2013 07:47

Where will they find $88.5m to build it? These assets also secured against a loan, due for repayment at YE. Right now it is a pipe dream to bring Tri-K into production. I will be very interested in the Q3 results at the end of the month for total cash costs, cash position and an update on loan and debt situation. AVM have a lot to do to persuade me to be positive again.