Feb 21, 2008 News Release:
Production from the Lamaque underground mine has steadily increased from 5,137 tonnes of ore in October 2007 to 7,783 tonnes in January 2008. Century currently forecasts average production from the Lamaque underground mine of 300 tonnes of ore per day in the first quarter of 2008.
Mar 25, 2008 News Release:
Average daily production for March (through March 23) was 325 tonnes of ore per day.
For the month of April, the Company expects to increase production to approximately 400 tonnes of ore per day from the underground mine.
What can we extrapolate from these news releases? Production in January was 251 tpd based on working the full 31 days. This increased to 325 tpd for the first 23 days of March, so for February one would expect somewhere between 251 tpd and 325 tpd. The average of the two is 288 tpd, but to be conservative let's assume 275 tpd.
April was forecast to be 400 tpd so for the last 8 days of March the production should have exceeded the month-to-date average, but let's be conservative again and assume no increase.
Therefore we should reasonably expect the following for Q1 production from Lamaque:
January - actual reported = 7,783 tonnes
February - 29 days x 275 tpd = 7,975 tonnes
March - 31 days x 325 tpd = 10,075 tonnes
Total = 25,833 tonnes
Average tpd for Q1 = 284 tpd
Forecast tpd for Q1 = 300 tpd
Actual as reported on Q1 financials: 17,045 tonnes
Average tpd for Q1: 187 tpd
Nov 5, 2007 news release:
The Lamaque mine is currently producing 350 to 400 tonnes of ore per day at an average grade of approximately 5.5 grams per tonne.
14 comments:
Carib, we know that PK, to cut to the heart of the issue, is a habitual l*ar! This is not a quality that inspires confidence among shareholders and investors.
Who was providing these figures to her? Adrian McNutt or Pascal Hamlin? Who writes the press releases. Who reviews for consistency and continuity.
The IR dept. has been regurgitating these figure ad nauseum to whoever calls him. He relies (he claims) on the mine to give him accurate data. Can CMM shareholders believe anything that he tells us when PK and the mine staff are misleading and deceiving him? I'm not accusing him of complicity, however, PK directed us last September to call IR if we wanted answers. I'd grab a baseball bat and stride into her office and take care of business if she made me look this bad to my shareholders.
We owe Sulliden a great deal.
If they hadn't complained to BCSC about CMM's shady accounting and reporting practices, Lord knows the company and shareholders would be in real world of pain right after PK's house of cards collapsed when all was eventually exposed.
I am going to add Sulliden and the BCSC to my Christmas card list. The BCSC actions practically guarantees that CMM's financials are clean now, the 43-101's are fine ... they can't do anything about incompetent management. That is up to the shareholders and Board of Directors.
What does the blog think of this news release?
First of all, where the heck did CMM get the money to buy out the hedge book? 11K ounces at $200 = over $2.2M that could have gone into expanding Lamaque. The only good news about that is now any future gold sales will be at current (and going much higher prices).
San Juan was a disappointment. $600? what happened to $300 or $400? Either way, gold at $1000 will give us cash flow of $2.4M per quarter..... not great but it will stave off any threat of bankruptcy.
With these numbers and a clean financial balance sheet (no buja buja or skeletons in the closet), I actually believe that this outfit is a strong speculative buy at this time.
I think that with San Juan putting out positive cash flow and no other unknown liabilities on the books unlike before with Rosario, hedge book, Shahuindo etc. This returns certainty to the investment community which will bode well for both Fortis and investors.
I call $0.05 the bottom. Question now is where does it go from here?
will PK issue more paper? or will MRI and Fortis come through?
A few other interesting notes from the Q1 MD&A:
The San Juan mine produced 4,058 ounces of gold during the first quarter of 2008, the highest quarterly level since the Company has operated the mine. The mine has recently initiated operations at Veta Clara and Veta Jessica, which are narrow vein, high grade operations that have improved the overall grade but also increased mining costs. As San Juan management gains experience with these conditions, mining costs should decline after one or two more quarters.
On June 2, 2008 the Company agreed with a Swiss financial institution on the terms of a $5 million loan to be completed by June 30, 2008, and now expected to close by late July.
On July 7, 2008 the Company bought out the forward gold sales commitment at an average price of $923. The Company anticipates that it will settle its obligation with the trader, Gerald Metals, during the third quarter.
As a result of settlement discussions with respect to the claims filed by Sulliden
Exploration Inc. in the Ontario Superior Court of Justice leading up to the scheduled court date of July 9, 2008 the trial was rescheduled to late October,
2008.
I agree with you, Optimusprime, that we owe the BCSC & Sulliden considerable gratitude for calling attention to CMM's shady accounting & reporting practices; and thereby forcing PK & Co to cut out the doublespeak and tell the truth about the Company's finances. At least now we know that we have a huge working capital deficiency.
Even the tone of MD&A is different this time. Seems to be devoid of the usual BS and sounds more humble (if that's possible with PK!?). The upcoming conference call should be interesting.
By the way, in your Christmas cards to BCSC & Sulliden, please add that many other shareholders feel the same way as you do [Proof: the poll results a while back about PK's resignation/firing]
I beg to differ on the thank-you's to Sulliden. Itr was PK's grossly miscalculated missteps and financial desperation that led to the disastrous take-over bid for Sulliden that got us the truth about the finances in the end. Had she not gone that route, Sulliden would not have had reason to look at her finances.
Gambit, you won't find anyone around here who disagrees with your remarks about PK's "miscalculated missteps and financial desperation" that got us here.
I might add her huge ego and flagrant disregard for shareholders rights.
Regardless, it was Sulliden who complained to the BCSC that triggered the clean-up of their reports, filings, and financial statements. Our own Board of Directors were derelict in their oversight duties.
The CFO's who challenged her were suddenly departing for other opportunies. The new CFO would have left too were it not for the CTO and MCTO. If you look him in the eye you can see that the PK factor is there.
PK is continues to manipulate - she convinced owners of 60 million shares to vote for her. This despite losing millions on hedges, the aborted Shahuindo/Rosario deal, and $20 million in the Sigma Pit.
We learned yesterday that CMM has a settlement date with Sulliden scheduled in October. She refuted their claims during the takeover bid. PK has never explained why she withdrew the Sulliden takeover bid after burning through big bucks in the pursuit.
Nope, the best thing that happened to Century is when Sulliden complained to BCSC and PK got her big comeuppance. The Board of Directors if they had any guts should do what the retail shareholders and Wega would not do. lol
N/R from
Tuesday, June 24, 2008
Our recent share price decline has come from repeated program sales from a significant shareholder who has declined to work with management to move its block of stock.
Now we know why Wega as declined to work with management. I wonder if they tried to get the BOD to get PK out and when they realized it wasnot going to happen started selling. I talked to a person in the mining business and told him the rumour was out that PK was gone, he told me its almost impossible to get the BOD to agree to get the CEO out. He was right. Would NOT comment on PK.
Makes me wonder what is in it for the management and BOD of this company to keep making one mistake after another (its as almost done on purpose), I am a firm believer that ITS ALWAYS about the money, you guys can speculate on how people would of made money on CMM.
I've been a fan of this blog since I discovered it a few months ago. As a fellow Century shareholder, I wanted to thank Carib for all his hard work.
Personally, I've been averaging down at these levels. With the CTO soon to be lifted, Peggy and the directors will likely buy shares in the market - to the extent they truly believe in the company. It would be great if the selling at these levels dried up a bit causing the insiders to actually bid up the stock. IMHO, now (or below $0.30) is not the time to be selling.
From 1Q08 MD&A, Century granted 180,000 options at exercise prices b/n $0.12 and $0.25. Century managers should be buying their stock in the open market like everyone else (especially at today’s prices!). They should not be granted any stock options until the share price significantly recovers. As for the fact that their existing options are underwater or expired as they were underwater… my investment in Century is also underwater. Let’s get it to dry land before granting bonuses and options to the management who brought us to this point.
Nino, from a practical perspective Wega probably had valid reasons for selling to get under the 10% ownership reporting other than PK's personality. Why would they decline to work with CMM management if they were being offered more money for their shares? Does that make sound sense? Hans reportedly stated that Wega would stop selling when they saw a reason to stop. What a stupid statement. I'd think it was bogus except I know the guy who he told it to. Ingles and Schneider are the only large institution who voted for PK to remain. The retail shareholders voted the bulk of the votes to keek her around.
The money was made in 2006 when PK's pals at RAB, Endeavour, Sprott, Canaccord blew out their 25cent shares betweeen $1.25 - $1.89. She denies it was a pump and dump and passed the blame. In 4Q 2005 they reported 20,000 ounces of gold. The future looked golden. Then the lies came home to roost - and the rest is history. Incidentally, some of those sharks from the old days are circling CMM. Did you discuss the AGM with BJ?
Hi Nino,
Unfortunately, in all probability even the "independent" directors were nominated by PK (as Chairman, President & CEO). That is where part of the problem lies with CMM: the Chairman should not be CEO. So our independent directors aren't truly independent.
One would think that independent directors have their reputations to protect, before they allow themselves to be party to shady and misleading accounting & reporting practices (as was the case with CMM's Management prior to BCSC's CTO). One would also expect that they might respond to shareholders' letters. But not this bunch (at least not so far).
If Wega really wanted to get PK out, I think they could have, if they chose to do the planning early (like last fall). All they had to do was team up with Scion, and advertise for the disgruntled small guys (like us) to come on board. If they did that the share price currenly would be over a dollar. IMHO.
The current low share price is reflecting the markets negative assessment of Century’s prospects for success in closing on their debt financing any time soon. I would agree that in the current environment of an extreme credit crunch and low gold price relative to high input costs that Century's chances for success with the Fortis debt financing are quite slim. So any success on this front would be a big upside surprise. In the meantime any recovery in the share price would be contingent on Century demonstrating that it has the ability to wait this credit crunch out, and clearly the poor balance sheet raises serious questions in this regard. There is also the possibility that a higher gold price relative to energy and labor costs would reopen the financing options for Century even if the credit crunch was persisting, if for example Century could make a good case that the loan could be paid back in less than 12 months. I think there is no appetite any more for making loans that take years to pay back. A sustained rise in the gold price to somewhere in the range of $1200-$1600 while oil goes sideways might just do the trick. This would be another upside surprise that the market is currently not anticipating. While I am of the view that there is a reasonably good probability of this relative out performance of POG happening, I am less certain of Century’s ability to hang in there for the 6-18 months more time that may be needed for this to fall into place.
optimusprime:
Did you discuss the AGM with BJ?
I got tired of listening to his lies, mostly over the phone. Try to get him to put it in writing (I have a couple of times,just in case it is needed).
GLTA
Our production is small potatoes, but nevertheless, it's nice to finally be able to participate in the $972.50 gold price. It has been a long time for us. The pathetic hedging decisions by this management team in the past have been extremely stifling to shareholders. Hopefully the hedge buyout is an indication that these people will finally stop making what I would consider to be boneheaded decisions. I actually thought that the timing of this buyout was actually really good from many perspectives (albeit it might have resulted due to the curtailment of Lamaque). Here are some things I liked about the timing:
1) The gold price continued to rise nicely after the buyout price - we get immediate benefits.
2) We would have been capped at $727 until into next year. Instead, we now get the difference between $972.50 vs $727, and any benefits that may arise above that - the rise in gold price doesn't seem like a complete waste anymore.
3) The buyout payment to Gerald Metals is not expected to be made until Q3'08 - let's say mid Q3. That would mean we get to capitalize on about 5 weeks of the higher gold price before the payment is due. The benefits gained throughout the 5 weeks can go towards the payment. Of course, the money is needed elsewhere (given it's essentially our only source of revenue), but speaking theoretically.
4) Based on the MD&A, it sounds like the hedge buyout will be paid either through an equity offering or if they can manage to do it through debt. Of course, any type of equity offering sucks, but it's cash that is most vital right now (unfortunately). Doing it through equity (although it dilutes shareholders - not that the share price has much more to be diluted, with being $.085 and all), it allows the added exposure to become a new source of income ($972.50 vs $727, and anything beyond). This is money we otherwise wouldn't have.
One last thought. I think it is important for management to change its ways about keeping shareholders in the dark for extremely long periods of time. They really do need to provide a current update to shareholders about San Juan's production, in particular about cash cost per oz and tpd. Apparently, they provided a very positive update at the AGM, but we all know about the lack of credibility. They need to do an official update via a news release.
Optimusprime, you are one of the best informed and most knowledgeable posters on this board about CMM's management, and PK's shenanigans (past & present). Including the "pump & dump" period in 2006 (e.g. "blowing out" the 25-cent shares by RAB, Endevour, Sprott, etc between $1.25 -$1.89). You also seem to have good knowledge concerning what's going on inside CMM.
I have three questions for you: (1)With having her knuckles wrapped by the BCSC, is there any hope that PK is capable of reforming her act (or is that just a "pipe dream"? in your opinion, of course)? (2) Should we (disenfranchised shareholders) begin the "Zarlink style coup d'tat" against CMM's management sooner rather than later (the idea suggested by Production05 in one of his posts; he seems to think later would be more appropriate)? (3) Is there another remedy for our predicament (other than selling our shares and take the capital losses)? I look forward to reading your views
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