Rambler Metals & Mining Share Discussion Threads

[snowydays] 15/3/2012 16:47

Hmmm,

"Initial CAPEX requirement of $231M estimated for the entire ramp-up of
the project. "

but

" Numerous opportunities exist to improve the business case. It is these
areas that future optimization and engineering studies will focus on to
ensure that if or when the decision is made to proceed with the
expansion, the project will benefit from the upside of the existing
operation. These opportunities include:

-- A reduction of upfront capital requirements by advancing synergies
with current operations; "

Let's assume the capex can be reduced to $200m.

The company should be producing strong cash flow once copper concentrate production starts. At least $100m in the next three years, and possibly $130m or more. If the expansion could be delayed by 18 months then cash flow alone might cover all the costs.

But if there is a need to find another $100m to satisfy the capex requirements how much can be borrowed? A company generating around $45m each year, with at least six years at the current rate of production should be able to borrow two years cash flow without too many problems.

Hopefully we will get some more details when the second quarter results are released next week.

[myst1] 15/3/2012 16:31

Rambler unveils positive PEA for Ming mine
15 March 2012 | 14:09pm
StockMarketWire.com - Rambler Metals and Mining has completed a preliminary economic assessment to include the lower footwall zone mineralisation in its mine plan at the Ming copper-gold mine, in Newfoundland, Canada.

This assessment has evaluated the potential for an expansion programme to first optimise then transition the Ming mine into a bulk tonnage operation.

The results show positive economics, good internal rate of return and significant cash flow in addition to numerous areas of opportunities which can only further improve the findings in future studies.

The PEA is based on an optimization of the current high grade operation at the Ming Mine and Nugget Pond milling facility followed by a transition into a 20-plus year bulk tonnage mine based on the anticipated ramp-up schedule:

* Current Production: 630 mtpd (year one)

* Years two and three: 1,000 mtpd (optimisation of existing infrastructure)

* Years four to end of mine: up to 3,500 mtpd (bulk tonnage operation)

* Also in year four and five the Nugget Pond hydrometallurgical facility will process all remaining gold ore from the 1806 zone within the Ming Mine

At 2:09pm: (LON:RMM) share price was +0.75p at 34.25p


Story provided by StockMarketWire.com

[killing_time] 15/3/2012 16:02

Had a quick read through and this looks impressive.

[myst1] 15/3/2012 15:16

This RNS relates to the Lower Footwall Zone and to my mind there is no value in the current share price attributed to this area.

The following courtesy of Harry P on iii:

This is the "initial" news we've been waiting for on the Lower Footwall Zone. It is a massive resource that would require a bulk mining operation. The bulk mining operation would significantly reduce cost per lb of copper and massively extend the life of the MING mine and therefore potentially move the company to the $350-$500 mln mkt cap that George Ogilvie has been recently talking about. With that though comes a cost.

Potential to increase daily throughput by 500%, extend life to 20 years and beyond (also depending on further exploration of exsiting resources), and reduce cost per lb by 50%. Plus free up the Gold mill to work independently on our gold rich zones or satellite operations in the area (Maritime??) whilst the new copper mill worked solely on the Ming resource.

However, all of the above is NOT for now. I haven't had a chance to have a proper look at this yet, but it's effectively advising of the what the POSSIBLE outcomes are.

Having a very quick glance through they don't believe that a bulk mining operation is likely until 2015/16/17. And that is where the big infrastructure costs would be.

You'll note that years 1-3 (2012-2014) are still using existing infrastruture with various pieces of optimization.

This is purely the preliminary econonimic assessment - i.e could this be profitable going forward.

Will have a proper look at this tonight.

Cheers

H_P

P.S. Timing of the new strategic partner announced last week looks quite coincidental now - lol! In 3-5 years we may need to raise quite a bit of money IF the LFZ gets the go-ahead and TINMA happen to have close "relationships" with the 2 biggest banks in China - Chinese Construction Bank International and Chinese Agricultural Bank - this i sall getting quite exciting now!

[elban] 15/3/2012 14:52

Saucepan,

What significance?

It looks to me like they will need a placing in the next two years to raise about 3 times the present market cap.

The economics look good and I like the management.
But a whopping placing is a big negative.
Hard to judge a value for the share price until we know the details.

[fangorn2] 15/3/2012 14:35

Positive PEA

[saucepan] 15/3/2012 13:58

Great RNS out just now. I don't think the market has woken up to its significance.

[mdchand] 08/3/2012 23:27

Broker Note - Ocean Equities

Whereas this news has little bearing on Rambler's current operations, which have shown that the initial copper production phase will be economically robust and self sustaining, the bigger implications for this news are that Rambler is preparing the way for the development of the Lower Footwall Zone (LFZ). A preliminary study on developing the LFZ is expected from Rambler soon which will highlight the economic viability of the project that could fundamentally change Rambler's outlook. Most importantly, there is a chance that Rambler will be able to sustain separate copper concentrate and gold dore production streams, which would give the Company two sources of revenue and allow it to target the recently discovered high grade gold areas in the Ming mine as well as produce copper concentrate from the bulk mineralised areas in the LFZ.

Moreover, as we have seen from Rambler's recent strategic move to take an equity stake in Maritime Resources, its fellow Newfoundland explorer, Rambler is beginning to look at its prospects beyond the Ming mine. The historic and high grade copper-gold mine provides a great foundation for Rambler to grow its production base in a low risk operating jurisdiction.

Picking a China based group is a smart move for Rambler as it accesses a new pool of capital as well as strengthens its ties with China based groups that are most likely to take Rambler's copper concentrate.

Rambler is close to bringing the copper circuit on-line at its Nugget Pond processing facility, part of its fully integrated mine-concentrator-port facility in Baie Verte, Newfoundland. Currently the mine is in an initial gold production phase to take advantage of the current high gold price and the large amount of high grade gold ore that Rambler has in the higher levels of the Ming mine.

[gardenboy] 08/3/2012 16:37

chip,

Many thanks for the figures. I have updated a link in the header directing to post 1504. The date reference could be changed should you edit the post.
Again,thanks

[chipperfrd] 08/3/2012 13:53

FY is to 31st July. I am really estimating for calendar years. I need to change the headings for my summary.

I was planning to expand my model to FY quarters once they are into concentrate production

I will edit my earlier post.

Cheers Sporazene.
Chip

[sporazene2] 08/3/2012 13:45

chip the fiancial year being august to august for RMM?

[timberwolf3] 08/3/2012 13:00

Thank you Chip.

[chipperfrd] 08/3/2012 11:53

Summary of my 3-year earnings estimates for RMM including latest placing.

Nothing included for current gold from 1806 zone.
6-year NPV (currently 1807 zone only) will obviously change significantly once a FS is conducted for the LFZ. So nothing included yet by way of CAPEX for that possible expansion to 4ktpd of ore throughput.
AIMO so please treat with caution.
Chip


updated 8/3/12 (1807 zone only)
Calendar Year ................. 2012 ........ 2013 ........ 2014
Copper price/t ................ 8,287 ....... 8,287 ....... 8,287
Gold price/oz ................. 1,684 ....... 1,684 ....... 1,684
Silver Price/oz ............... 33.39 ....... 33.39 ....... 33.39
Ore mined (t) ................. 135,000 ..... 250,000 ..... 250,000
Ore Milled (Mining Rec 90%) ... 121,500 ..... 225,000 ..... 225,000
Head Grade Cu (%) ............. 3.86% ....... 3.90% ....... 3.90%
Head Grade Au (g/t) ........... 1.75 ........ 1.75 ........ 1.75
Head Grade Ag (g/t) ........... 7.18 ........ 7.18 ........ 7.18
Milled Cu (t) ................. 4,690 ....... 8,775 ....... 8,775
Milled Au (oz) ................ 6,837 ....... 12,661 ...... 12,661
Milled Ag (oz) ................ 28,050 ...... 51,945 ...... 51,945
Concentrator recovery Cu ...... 92% ......... 92% ......... 92%
Concentrator recovery Au ...... 75% ......... 75% ......... 75%
Concentrator recovery Ag ...... 60% ......... 60% ......... 60%
Recovered Cu (t) .............. 4,333 ....... 8,108 ....... 8,108
Recovered Cu (lbs) ............ 9,550,963 ... 17,870,252 .. 17,870,252
Recovered Au (oz) ............. 5,128 ....... 9,496 ....... 9,496
Recovered Ag (oz) ............. 16,830 ...... 31,167 ...... 31,167
Revenue (US$) Cu (98.5%) ...... 35,372,945 .. 66,184,267 .. 66,184,267
Revenue Au @ 75% attrib ....... 6,087,604 ... 11,273,341 .. 11,273,341
Revenue Ag @ 60% NSR .......... 337,178 ..... 624,404 ..... 624,404
MING revenues US$ ............. 41,797,727 .. 78,082,012 .. 78,082,012
Operating Costs ............... 12,689,460 .. 23,499,000 .. 23,499,000
OP Costs per tonne Cu ......... 2,928 ....... 2,898 ....... 2,898
Concentrate produced (t) ...... 14,943 ...... 27,959 ...... 27,959
TC $/t @ x/t concentrate ...... 747,150 ..... 1,397,948 ... 1,397,948
RC per lb @ y/lb contained Cu . 477,548 ..... 893,513 ..... 893,513
Sustaining + dev Capex ........ 11,120,000 .. 9,680,000 ... 7,500,000
Operating pre-tax cash-flow ... 17,988,267 .. 44,903,012 .. 47,083,012
Gold Tailings Operation
Throughput tpa ................ 215,550 ..... 215,550 ..... 215,550
Tailings grade g/t ............ 1 ........... 1 ........... 1
Recovery rate % ............... 80% ......... 80% ......... 80%
Payable gold production oz .... 5,212 ....... 5,212 ....... 5,212
Revenue from tailings (75%) ... 6,582,772 ... 6,582,772 ... 6,582,772
Costs at $5/t ................. 1,077,750 ... 1,077,750 ... 1,077,750
Cash flow (Tailings) .......... 5,505,022 ... 5,505,022 ... 5,505,022
D&A ........................... 1,600,000 ... 1,880,000 ... 1,780,000
EBT ........................... 21,893,289 .. 48,528,034 .. 50,808,034
Tax rate ...................... 0% .......... 0% .......... 0%
Tax Charge .................... 0 ........... 0 ........... 0
CAPEX ......................... 0 ........... 0 ........... 0
Free cash-flow ................ 17,988,267 .. 44,903,012 .. 47,083,012
Shares in issue (FD) .......... 139,593,428 . 139,593,428 . 139,593,428
EPS (US$) ..................... 0.129 ....... 0.322 ....... 0.337
FOREX (GBP/USD) ............... 1.589 ....... 1.589 ....... 1.589
EPS (Ukp) ..................... 8.11 ........ 20.24 ....... 21.23
Est share price @ PER of x9 ............ 73 .......... 182 ......... 191


Phase 1 NPV estimate
NPV (US$) = .................... 183,462,116
IRR (%) ........................ 66.7%
NPV/share US$ .................. 1.31
NPV/share UK(p) ................ 83.6
Discount rate .................. 6%

[dukedosh] 08/3/2012 07:47

I often wondered why the TSX doesn't take to this stock.

Is it really good business to sell a large chunk of your already successful company, on the cheap and you don't even need the money? Would you? I most certainly wouldn't.

Where would we all be if we offered all our major customers a couple of places on the board? Sure as eggs are eggs it will attract talks about the product at a preferential discount to market prices. I wouldn't.

For our troubles, us existing shareholders get a 8% dilution and a couple of unknown entities on our already well appointed BoD. Where's the upside for us?

And the good news was what exactly?

I often wondered why the TSX doesn't take to this stock.

[gardenboy] 07/3/2012 20:07

random,

thanks for ManicMiner's info.

despite the Trade Show in Toronto little interest in Rambler on the TSX today

[randombutton] 07/3/2012 17:49

copied from manic miner again (last one)

All,

on Monday I visited the Rambler Booth at PDAC where I was informed the MIne has now exceeded 6,500 oz gold produced. There is still 35,000 tonnes of 1806 zone ore to be processed. This will be completed over the next two months whereupon they will turn over to the copper concentrator in May. There estimate was that by the time this 1806 zone block is mined at the end of April they are projecting total oz gold close to 11,500 oz gold. It appears that there are more tonnes (+15%) while the grade (4.2 g/t gold average) is (+10%) better than predicted.

For the copper concentrator they would like 60,000 tonnes of ore to be available which will give them three months of production in inventory. They currently have 20,000 tonnes. All construction work is now complete.

While at the booth they showed me some fantastic looking ore with double digit copper grades and multi ounce gold grades - spectacular.

I also noticed they hired a new IR person who was at the booth and they have redesigned there booth and promotional material as they are now a mining company.

I did speak to them about the [e-mail] e-mail and nobody from the Company getting back to investors. They recognize they have a problem. Apparently marketing groups send hundreds of junk information to this address meaning that genuine e-mails don't get seen. There looking at resolving the issue.

There Q2 results will be out in the next two weeks.

ManicMiner

regards

[timberwolf3] 07/3/2012 11:28

extract from above;

Analysts at Ocean Equities say that Rambler has made a smart move picking a China based group as a strategic partner, as it strengthens ties with Chinese groups that are most likely to take Rambler's copper concentrate.

"This new alliance has been specifically formed to provide the company with increased financial strength," said chief executive George Ogilvie.

[timberwolf3] 07/3/2012 11:27

Worth a read;

[steadyriser] 07/3/2012 10:34

Just got this from Seymour Pierce. Provides a little clarity from their Nomad.

Rambler Metals & Mining 3,4,5 (BUY) - Tinma becomes strategic shareholder in Rambler
RMM.L (34.75p, Target price 62p) Market cap: £42.9m

Rambler announces today the acceptance of a C$4.6m strategic stake by China-based investor Tinma International. Tinma is primarily focused on the trading and processing of non-ferrous metals, but has been recently looking to expand into upstream mining processes and the investment in Rambler will be the first of such strategic investments made by the company. It is hoped that through the relationship with Rambler, which has been developing since last March, synergistic value will be exacted between Rambler's own operations and Tinma's own non-ferrous metals trading and processing businesses. Conducted at a placing price of C$0.44 based on the weighted average price of the shares on the TSXV over the 90 prior trading days to 14 Feb, the C$4.6m stake by Tinma will bring that company's stake in Rambler to 9.9% after the admission of a further 10,403,980 ordinary shares to the AIM market (an increase of 8.4%). The purchase has been entered into on a conditional subscription basis and will see Tinma granted first refusal in all subsequent equity fundraisings enabling Tinma to increase its shareholding to not more than 19.9%. In addition while the holding remains above 9.9% Tinma will have the right to nominate one director to the board and if above 15% a further director can be nominated. The funds from the current raising will be used by Rambler to advance the Ming Mine's Lower Footwall Zone through a feasibility study and for general working capital purposes. As of last night Rambler traded on a P/E ratio of just 1.9x and an EV/EBITDA ratio of 1.8x for 2013E.

[cfro] 07/3/2012 10:13

Snowydays, A pe of ten is perhaps a little optimistic but a pe of 5 certainly wouldnt be. Saying that i have known mines with short lives comand extraordinarily high multiples in past mining booms.

And lets be honest, management are being extremely cautious with their 6 year mine life estimate. We all know it will turn out to be significantly more than that. Again in my experience, i have known mines with short lives to still be in operation some 80 years later!!

This cash will be put to good use. The management here are very shrewd. What we need now i the copper operation to quickly come on stream then we should get our re-rating.

[billy_liar] 07/3/2012 09:26

Money talks. Let's face it, if you had bags of cash to invest you would be looking for a discount too. Not rocket science.

If you think the company doesn't give a hoot about your £5K holding, guess what? You are probably correct.

[ajviews] 07/3/2012 09:11

The proactive update from yesterday also confirms the points from manic miners conversation - with funding available to finance progress at the LFZ. The article also mentions that separate copper and gold production lines are now a possibility -

Like the positioning for LT growth that RMM are working towards with the LFZ and regionally so would welcome the opportunity to add to my initial investment here on any weakness prior to further news. - AJ