Luna Gold is currently trading for $.79 per share. They went through a similar financing process as Century, with prepaid gold sales and heavy share dilution. In my view, their prepaid gold sales deal is much worst than Century’s deal, with a commitment of 17% of current planned LOM production plus 17% of future discoveries (on certain exploration locations).
In addition to the 17% LOM gold payment (debt) commitment, they also have a $15M repayment commitment on normal debt. Century’s gold payment debt is less than 5% of its current P&P Reserves. Also, there is no gold payment commitment on Century’s future Reserves. As well, Century does not have any other secured debts on its Balance Sheet to be repaid.
Luna Gold has no production ounces right now - Century currently produces 18,000 ounces. First gold pour for Luna Gold is expected in Q2’10 (same time period as expectations for Lamaque’s first gold pour).
Luna’s management has managed to deliver $.79 for their shareholders so far. There is nothing in Luna Gold’s fundamentals that I would consider superior to what Century Mining has to offer the market. IMO, if Century’s management does not deliver a share price substantially higher than $.38 in the near-term then I would consider it to be severe under performance by management.
Luna Gold:
Current share price = $.79
Current market cap = $280.5M
Current issued and outstanding shares = 358.8M
Current FD shares = 374.1M
Operating location (s) = Brazil
Expected first gold pour = Q2’10
Current run rate production = 0
2010 production = 47,760 ounces
Production in future years = 57,100 ounces per year
P&P Reserves = 729,000 ounces
Expected cash cost per oz = $422 US (+ 1% royalty)
Century Mining:
Current share price = $.38
Current market cap = $128.2M
Current issued and outstanding shares = 337.5M
Current FD shares = 400M (approx.)
Operating location (s) = Peru and Quebec
Expected first gold pour = Q2’10
Current run rate production = 18,000 (SJ)
2010 production = 65,000 ounces (SJ and Lamaque)
Production in future years = from 95,000 ounces (25K SJ + 70K Lamaque) to 185,000 ounces (35K SJ + 150K Lamaque)
P&P Reserves = 1,300,000 ounces
Expected cash cost per oz = $450 US - $500 US
5 comments:
Production, this comparison clearly illustrates the management discount from owning CMM. You can compare CMM to a lot of other gold companies and get similar results, but Luna Gold is a very good example because of its similar share structure. Based on gold in the ground CMM should be valued much higher than Luna, so it is obvious what the problem is.
I listened to the PK interview posted on the Century website and it was nauseating. It had to be a paid-for interview based on the heaps of praise bestowed on PK by the interviewer.
Please let's have the announcement of the new Chairman, new board members and the Operating Committee for Lamaque and send Andrew McNutt packing.
This comparison is excellent and Carib’s comments are noteworthy. I think that Century’s share price would benefit greatly from a consistent record of delivering on promises. Case in point, there is absolutely no excuse for late financial reporting to the Toronto Exchange yet this has happened on more than one occasion. Many times the press release has promised an event to occur before a specified date only to hear a redirection at the last minute. The market wants consistency. Sadly this has been lacking. But to Peg’s credit, we did get out Christmas toy (Lamaque financing) on time.
Let Cooler Heads
Before we going demanding someone’s resignation, let cooler heads prevail. First, Carib needs to tell us what specifically the issues with Mr. Adrian McNutt, VP of Operations, are. Having said that, we have the attributes that Mr. McNutt needs to change or we need to be looking for in a new in the new VP of Operations. The same can be said for the CEO and other Board Members. Without this sort of a qualitative analysis we may actual get something that is less desirable than the status quo.
Anonymous, the Blog Header states that posters must use a unique name and that Anonymous posts are subject to deletion.
Were both comments on this post from the same person?
Guys, how obvious could it be? Carib is 100% right - is there really any doubt that with a new CEO this stock is at a buck???
Peggy caught a hail Mary pass with Finsky/Scola which is really great. But she took the company to the brink, diluted the hell out of us to benefit HERSELF, for example: $200k senior secured loan to the company (secured against mill equipment) at a high interest rate - here's the kicker - with FULL WARRANT COVERAGE AND MAKING THE INTEREST CONVERTIBLE AS WELL... this $200k loan within the past 12 months was converted into over 8,000,000 shares which is today worth over $3,200,000 to PEGGY... WHAT DID WE GET FOR THAT $200K LOAN? DID IT SAVE THE COMPANY FROM GOING UNDER??? This has been only one of several financings that has helped Peggy and hurt us, after our shares cratered under her 'leadership' from $1.60 to 1 penny!!! But I digress.
Without her, INSTITUTIONAL MONEY will flow into the name. Finsky/Scola know this. If they want Century as a roll-up vehicle they need to have a currency in the stock. For that to happen, institutions need to invest.
Good job Peggy for getting this financing - it was a great job, actually. But lest we forget, Century was not otherwise finance-able as people would not invest in HER!
If she parts from the company now, the share price will fly. It's crystal clear and Carib/Production are right in their postings.
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