Medusa Share Discussion Threads

[johnhemming] 02/8/2021 06:47

In a sense management cannot win. If they include costs in the AISC then people criticise them, but if they make a judgment call and exclude them then the argument is put forward that they are misleading people.

In the end they need to also put forward an analysis. My view is that if they are developing the new incline and cash balances are staying constant that is a good situation.

[pigeonfeeder] 01/8/2021 21:28

Maybe I am over estimating the intelligence of investors but I find it difficult to believe that 'most people only look at the first page of the Qly results'. Surely if you notice a significant increase in AISC the reaction of most investors wouldn't be to immediately sell but to read the rest of the (brief) announcement and find out the cause?

There does appear to be an element of subjectivity as to what is included within AISC.

The World Gold Guidance on AISC:

“Non-sustaining costs are primarily those costs incurred at ‘new operations’ and costs related to ‘major projects at existing operations’ where these projects will materially benefit the operation. A material benefit to an existing operation is considered to be at least a 10% increase in annual or life of mine production, net present value, or reserves compared to the remaining life of mine of the operation. Companies should publicly disclose the ‘new operations’ and ‘major projects at existing operations’ that are considered non-sustaining. ”

Therefore it is likely that MML have judged that there is no definite evidence that the decline will meet the definition of being a material benefit to an existing operation.

I think most investors in MML have been frustrated at the share price - the price doesn't seem to be close to what we believe is true value.

As I said in my previous message and it appears you agree I see no justification for the price drop and I believe true value will come through eventually. I believe it will be a temporary price drop and value will out.

[polaris] 01/8/2021 19:02

Guys - i know it is in there. The point is that most people only look at the first page of the Qly results and saw 22odd k production at $1594 in the headlines and no increase in the cash pile. The inclusion of the costs was not in the highlights for the Q but buried much later.

As a cap-ex project and not standard operational works, i wasn't expecting the costs to be put through in the operational AISCs. I wouldn't class it as sustaining cap-ex, clearly the company are. Had the company flagged it before the announcement then i doubt the share price would have dived 12 % on the day of the report. Hence, a PR screw-up. Of course AISCs are going to rise if you are spending $50 odd M on a multi-year project and putting the costs through the books as operational spend. I did wonder why MML were keeping to FY AISC guidance after Q3, despite the operations coming in well under that. Now I (we) know. At least it is flagged going forward.

I still expect a further dividend at FY results in a month or so. The payment of an interim would look very weird otherwise. The fact that MML could spend $6.5 M on Tiger Way in the Q shows that the $70 odd M on the books are unlikely to be required for the cap-ex project itself. It's planned for 36 months and $54 M, which is more like an average of $4.5 M per Q.

Clarity is key for a small miner. Teo and his team seem to be masters at obfuscation. How can a company that has $70+ M on its books, beats its production target and meets on FY costs drop 12 % on the report day when the EV is less than 1.5x cash-flow post AISCs?

[johnhemming] 01/8/2021 08:42

From the announcement:
"All-In-Sustaining-Costs (“AISC”) in the quarter increased as expected to US$1,594 per ounce with the inclusion of costs associated with the construction/development of the Tigerway Decline Project. Total capital costs to date for the Tigerway Decline stands at approximately US$6.5 million. The AISC for FY2021, inclusive of the Tigerway Decline was achieved within guidance at US$1,231 per ounce."

[pigeonfeeder] 31/7/2021 22:58

The quarterly clearly explained that AISC included the costs of the decline and should be obvious to anyone reading the statement.

I don’t see why it needs to be flagged up in advance that the cost would be included.

If you think the fall in price was unwarranted then it is a buying opportunity, unless like me you have reached the limit of MML exposure you are comfortable with. I am happy with my investment and the quarterly hasn’t changed my view. I’m a long term holder and am not bothered by short term price fluctuations. I believe the market will see the value and if it doesn’t then it is me that is wrong.

[c9ajl] 28/7/2021 22:50

Medusa exceeds gold production target in the Philippines | Kitco Newshttps://www.kitco.com/news/2021-07-27/Medusa-exceeds-gold-production-target-in-the-Philippines.html

[cp42kx07] 28/7/2021 10:11

Agreed. It's absurd but, as usual with this company, they continue to present themselves in a most negative way. It defies logic (unless the directors have an entirely different agenda to the shareholders). Very disappointing yet sadly not surprising.

[glavey] 28/7/2021 07:15

On that basis the AISC will not be looking good for some time.
Off a good 10% - AUS market clearly not impressed.

[geckotheglorious] 27/7/2021 10:36

When is one of the majors going to come along and buy this dog - and get rid of Teo.
He is useless and definitely holding this company back.

[polaris] 27/7/2021 08:50

Was expecting a cash increase this Q to over $80 M. looks like MML have added the Tiger Way costs into the AISCs, which add around $300 to the Qly costs. That drop in grade is also symptomatic of the last time Teo took charge, as a COO keeps on top of mine grade and Teo isn't a mine manager. That said, if MML can pay for Tiger Way out of operating cash-flow and retain $70-75 M in cash, that will work while construction happens. Another month or so until audited results and forward guidance for 2022.

[c9ajl] 27/7/2021 08:06

Quarterly Reporthttps://www.medusamining.com.au/wp-content/uploads/2021/07/210727_june2021quarterlyreport.pdf

[polaris] 05/7/2021 13:08

Anyone buy the bottom of the trend? Another nice bounce off the trend-line and the wedge is slowly closing. Maybe just in time for information on the annual production.

My average is near AUD$0.835, after taking into account the dividend payment on part of the holding bought before ex-dividend date.

AUD:GBP and AUD:USD exchange rates aren't doing us any harm either. Just means the business is on an even lower forward multiple.

While Tiger Way is under construction (36 months), i just want MML to keep production steady, unlike the debacles of other works. The fact that this work will not require haulage from the existing shafts should preclude repeats!

FY2022-2024 at 90-95 k oz and $1150-$1200 AISCs would do just fine by me. If they can add in a divi of AUD$0.08-0.10 p.a., even better!

[deka1] 30/6/2021 06:31

polaris hi , thanks for your input on this board .

[polaris] 29/6/2021 13:30

Back down on the base of the channel. I've got as many as i can afford here, unless one of my other stocks shows a breakout to release margin. FY21 end for MML is tomorrow and then the wait starts for the Qly production and then audited FY21 results. I am expecting another dividend in H2, hopefully another AUS$0.05. It is hardly that taxing on the FCF. Going forward, I'd like some statement from MML on a dividend policy of a certain amount of FCF. That would draw in some income investors. At AUS$0.805 the yield would be over 10 % if a H2 dividend matches H1. Whatever you think of Teo and the legacy issues, the share price should be well over AUS$1 on production profile, AISCs and cash at hand.

[geckotheglorious] 24/6/2021 08:51

Damn, TEO is still there!!!

[c9ajl] 24/6/2021 08:47

Results of General Meeting 24 June 2021https://www.medusamining.com.au/wp-content/uploads/2021/06/210624_resultsofgeneralmeeting2021.pdf

[ilostthelot] 09/6/2021 11:08

Looks like the beginning of a breakout. A$1 goes we're off to the races!

[polaris] 03/6/2021 08:29

A couple of up days over the last week to come off the bottom of the rising channel. Maybe someone with deeper pockets than me is finally taking an interest. I've got around 100 k of these now. Picked up another 20 k over last week. Gold averaging around $1850 for the FY will do very nicely. Only another 4 weeks til period end.

[bushtuckaman] 02/6/2021 19:10

At what point does an RNS similar to the one below become a possibility?





The difference now is that board and management don't hold so much stock!

[polaris] 02/6/2021 16:29

Traded is AUS$ but the figures are presented in US$ for results and cash holdings. That $72.2 M of cash is worth quite a decent part of the market cap in AUS$. It’s a little over 50 % of current share price at current exchange rates. Forecast operational cash-flow for FY21 is not too dissimilar to current cash pile if MML meet upper forecast for production and lower target for AISCs.

[deka1] 02/6/2021 16:04

tuckerman cheers

[bushtuckaman] 02/6/2021 14:33

No Deka, Oz dollars as traded on the asx.

[deka1] 02/6/2021 14:19

Please anyone , are Medusa share prices traded in usd
tia

[killing_time] 29/5/2021 12:36

Thank you Glavey, that was a big help and i no longer have the hassle of heading to the bank. KT.