# PEM - Perilya Limited



## brerwallabi (24 August 2004)

PEM is starting to look interesting up 8 cents from 74 cents last week to 82 today, big volumes for PEM 2.5m in last two days have not seen that volume for over 3 to 4 months. The are well and truely over production problems of earlier this year which was really a one off. Has some possibilities I think anyway else share an opinion?


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## brerwallabi (28 September 2004)

*Re: PEM a lot of volume the last couple of days*

PEM again goes up, hopefully to test 82cps again, I managed to pick up a few more at 72cps last week, closed at 77 tonight, will hang on to these. When the news starts to flow from the Dasy-Milano and Potossi mines coming in to production it should push PEM back to last years prices I hope. I hold. Has anyone else considered PEM?


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## brerwallabi (12 January 2005)

*Re: PEM a lot of volume the last couple of days*

Looks like this one might have slipped by a few of you, its worth looking into.


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## RichKid (12 January 2005)

*Re: PEM a lot of volume the last couple of days*

Em, too high for me now, wonder if it's ranging. Must have a closer look some time. You bought at the right time Brer! All the best!


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## brerwallabi (15 January 2005)

*Re: PEM a lot of volume the last couple of days*

"Em, too high for me now, wonder if it's ranging. Must have a closer look some time. You bought at the right time Brer! All the best! "
12th-January-2005 09:59 PM

Rich re your comment above, looks like it could test $1.00, if it breaks through I'm thinking around $1.20 will do me fine, but it could also fall back to the mid 70's. I understand your comment about being too high for you as the current chart does reflect an interpretation of that. This one has been a nice little earner as i have traded in and out several times last year but you won't see my shares for sale just yet. By the way Bolnisi is very worthwhile watching too, i picked up  a small parcel.


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## RichKid (16 January 2005)

*Re: PEM a lot of volume the last couple of days*



			
				brerwallabi said:
			
		

> By the way Bolnisi is very worthwhile watching too, i picked up  a small parcel.




Yep, agree with you there. Started a thread on BSG last week, resistance breakout trigger is only a few cents away imo, I expect it to be explosive rather than slow considering the sp history: https://www.aussiestockforums.com/forums/showthread.php?t=831


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## brerwallabi (15 March 2005)

*Re: PEM a lot of volume the last couple of days*

Well it made $1.20 fallen back but climbing back currently $1.18, not only a zincer but has some handy gold deposits up its sleeve, up 60% since I really got interested in this last July, looking for $1.35 now based on daisy milano and further good outlook in zinc prices. I was early into zinc PEM and CBH, I believe I am early enough into some goldies for a very enjoyable ride.


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## brerwallabi (25 April 2005)

*Re: PEM a lot of volume the last couple of days*

Lot of talk on ZFX on this site, its not the only zincer around, I believe zinc still has further upside but is definately not a long term investment, CBH has had a few bit of news lately and looks good to go further, PEM has been dogged by a few bad news stories and the latest being the loss of long time CEO, its trending down at the momment it could continue down to 75cps or reverse back towards  $1.20, much also depends on the Daisy Milano gold pourdue next month,not just a zincer, wonder if chicken can till me if there is any manipulation here re the 30% drop.I sold out on PEM @ $1.08 after my stop/loss was triggered watching very closely now trying to pick the bottom lol


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## brerwallabi (31 July 2005)

*Re: PEM a lot of volume the last couple of days*

I always keep some stocks on my radar and this has been one, this was a good one to trade about this time last year went from low 70's to a $1.20. Its looking very close to that again, this was another small cap that I think became a victim of the China debate and combined with some doubt around it broken hill mine performence and its daisy milano gold op this cascaded down. I am back in and my expectection is a few good trades in riding this back up, those bollinger bands are very tight a break out it seems is looking to open. 



This view should not be taken as advice of any form.


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## Porper (31 July 2005)

*Re: PEM a lot of volume the last couple of days*



			
				brerwallabi said:
			
		

> I always keep some stocks on my radar and this has been one, this was a good one to trade about this time last year went from low 70's to a $1.20. Its looking very close to that again, this was another small cap that I think became a victim of the China debate and combined with some doubt around it broken hill mine performence and its daisy milano gold op this cascaded down. I am back in and my expectection is a few good trades in riding this back up, those bollinger bands are very tight a break out it seems is looking to open.
> 
> 
> 
> This view should not be taken as advice of any form.




Very interesting reading peoples viewpoints and interpretation of charts.Only a beginner myself, but to my untrained eye I can't see any buy signals, only MACD, and this has not been appropriate for PEM.Seems to be in a downtred/ranging.If ADX started moving upwards towards 20 then I might think a breakout was on the cards.

As you say though brerwallabi, one to watch as it could well turn positive .


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## brerwallabi (31 July 2005)

*Re: PEM a lot of volume the last couple of days*

Agree this has been ranging and that can also a good time to trade a stock, PEM has come of a low of 65cps and is moving towards the testing of its 100 day moving average of 78cps and may test that this week. It may also fall back, I have covered myself for that and will then watch again for an opp to trade it as it continues to range.


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## brerwallabi (12 August 2005)

*Re: PEM a lot of volume the last couple of days*

Well 71 cents Monday just went to 77 now this morning, fair bit of volume yesterday about to test 78 cents. Beautiful stock to trade.


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## brerwallabi (17 August 2005)

*Re: PEM a lot of volume the last couple of days*



			
				Porper said:
			
		

> Very interesting reading peoples viewpoints and interpretation of charts.Only a beginner myself, but to my untrained eye I can't see any buy signals, only MACD, and this has not been appropriate for PEM.Seems to be in a downtred/ranging.If ADX started moving upwards towards 20 then I might think a breakout was on the cards.
> 
> As you say though brerwallabi, one to watch as it could well turn positive .



 Porper are you still watching broke through 78which was my worry this time, now 80.5. I have held this time around, have bought and sold through previous ranging over the last 15 months and have managed to take advantage of any substanial previous rises as well, still believe this will go again, almost think I know it like the back of hand. Not one for the nervous though.


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## brerwallabi (10 September 2005)

*Re: PEM a lot of volume the last couple of days*

I made my decision to take the profit at 79cps on PEM took it at 66.5cps looked like it was going sideways again. Good move as it dropped to 73cps all set to reenter and it jumped up to 80cps. PEM took a hammering from some analysts over the past two weeks who put 65 -70cps on it. It now looks with the Friday news of $36m in cash received for future sales of silver which really is a by product of their core mining activities that Pem has the ability now to fasttrack their development and exploration plans. I believe this company could grow into a far bigger enterprise then it is now over the next few years, it is now cashed up with a total of $50M and has some very interesting projects. Its Daisy Milano gold project in WA will be becoming stronger and stronger with production coming on stream now. I have been able to trade this very well over the last 15 months but this time when I get back in I think it might well go to 1.25 -1.30.It is primarily a zincer, lets not forget the big jump lately in Kagara and ZFX is well up.I cant see any reason for this not to progress.
My Ops only.


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## GreatPig (11 September 2005)

*Re: PEM a lot of volume the last couple of days*

Here's my chart for PEM.

I bought in at 76.5 cents back in early August and am still holding. I'm hoping with the jump up on Friday, it might continue on up for a while.

But of course you never know...

Cheers,
GP


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## brerwallabi (30 September 2005)

*Re: PEM a lot of volume the last couple of days*

Pem finally broken through took longer then I thought took another profit again this morning.Feel it still has the potential to go $1.20 plus especially with the outlook for zinc. Hope I can read PEM, will look for the pullback to 79cps and get back in.  My strategy with this stock in trading in and out has been a great money spinner for me this year.  If you follow a stock real closely and get to know it as well I beleive I know Pem - it almost is a guaranteed income stream.


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## brerwallabi (26 December 2005)

*Re: PEM a lot of volume the last couple of days*



			
				Porper said:
			
		

> Very interesting reading peoples viewpoints and interpretation of charts.Only a beginner myself, but to my untrained eye I can't see any buy signals, only MACD, and this has not been appropriate for PEM.Seems to be in a downtred/ranging.If ADX started moving upwards towards 20 then I might think a breakout was on the cards.
> 
> As you say though brerwallabi, one to watch as it could well turn positive .



PEM still looks very healthy to me reentered early October and was able to take the benefit of the ride up to $1.00 and sold. Now back in @ .90c and holding, chart looks interesting, still trending up from mid July with a further upside indicated. Hey Porper did you ever buy this one.


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## Ann (26 December 2005)

*PEM ....time for caution?*

Excuse my intrusion, may I offer a slightly less optimistic view of this stock?


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## brerwallabi (26 December 2005)

*Re: PEM ....time for caution?*



			
				Ann said:
			
		

> Excuse my intrusion, may I offer a slightly less optimistic view of this stock?



Interesting but the chart looks somewhat different over a 12 month period and the last 5 1/2 months is a clear uptrend although some pullbacks on the way. What is helping this along the way is the zinc price, over the last few years I would say PEM has disappointed some hence the drop from the $1.20's of earlier  this year but it is a junior miner and a diversified one at that and one that has encountered some setbacks on the way. It looks like a continuation of an upward trend to me.


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## Ann (26 December 2005)

*Re: PEM a lot of volume the last couple of days*

Hi brerwallabi,

Let's do that shall we.....what I see if I don't look beyond twelve months.

I always look as far as I can normally. I always like to know if there is a bus coming at me from a distance....


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## Ann (26 December 2005)

*Re: PEM a lot of volume the last couple of days*

Hi brerwallabi

I just looked at your attachment.....You show it travelling in a ranging channel. Now potentially creating an upper point of resistance. Your chart re-inforces that the price is due for a retrace right now. That means down folks.

I am really not trying to hastle you brerwallabi, just say what I see.


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## brerwallabi (26 December 2005)

*Re: PEM a lot of volume the last couple of days*

Ann, in no way are you hassling???? me. I always respect someone else's opinion, this is a site where we come to learn from each other and share experiences. I will continue to hold PEM in the expectation that it reaches $1.20, 500k of shares were issued prior to Xmas, staff incentives at .80c & .90c which have an impact as I guess a few employees seek some money for holiday period.
I hope your interpretation is wrong (no offence meant).
PEM as had a run this time of year for the last couple of years and I also can not see why it won't again. Other factors in its favour some increasing demand for lead and a 10% increase in lead rices last quarter also a 30% increase in zinc in the last quarter and we all know about gold. A finger in the pie in Strike Oil which has jumped from 12c to 18c very suddenly - some things are looking good in my opinion.
Please do not rely on technical analysis solely, although I do sometimes - my estimation on PEM is governed by my own inevstigations and judgements. I hold but I am never last of a sinking ship.


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## Ann (26 December 2005)

*Re: PEM a lot of volume the last couple of days*



			
				brerwallabi said:
			
		

> I hope your interpretation is wrong (no offence meant).




So do I brerwallabi, whenever I see a negative in a chart, I always hope I have got it wrong. If I have got it right, that will mean someone may lose money...that thought always saddens me.


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## brerwallabi (26 December 2005)

*Re: PEM a lot of volume the last couple of days*

The thought of losing money also saddens me but I fully expect not be successful all of the time, I do lose but it is all part of the strategy and if I lose it will be triggered by a stop/loss and it would not dampen my enthusiasm for trading PEM as it is likely to continue in the channel if it retraces. My head tells me this is going to go ahead. We shall soon know.


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## Ann (26 December 2005)

*Re: PEM a lot of volume the last couple of days*

Please let me be wrong!


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## brerwallabi (27 December 2005)

*Re: PEM a lot of volume the last couple of days*

Ann that Wesfarmers chart you posted on Wesfarmers thread looks like its identical to PEM over the last few months, not hassling you lol.


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## Ann (27 December 2005)

*Re: PEM a lot of volume the last couple of days*



			
				brerwallabi said:
			
		

> Ann that Wesfarmers chart you posted on Wesfarmers thread looks like its identical to PEM over the last few months, not hassling you lol.




You could never be a hassle to me brerwallabi,

The thing about charting that I love is its infinite possibilities of interpretation...

You gave me a fright brerwallabi, I thought I had put the wrong chart in for WES, it was late.

I see what you mean....let's put up another chart for PEM shall we?


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## brisvegas (27 December 2005)

*Re: PEM a lot of volume the last couple of days*

some serious upgrade to 06 earnings projections in last week . i'd say some serious rerating of PEM likely by covering brokers likely when the holiday season over next week . certainly one for my watchlist and i note it is CMC included at 10% margin . that 1.20 resistance likely to be tested in not too distant future judging by fundementals . note that near 80 mill cash on hand and 10 mill invested in equities on a market cap of 180 mill 



FORECAST EARNINGS  Last Analyst Update  
 23 December, 2005 
 EPS(c) PE Growth 
Year Ending 30-06-06 18.7 5.3 -- 
Year Ending 30-06-07 21.2 4.7 13.4% 

.............. pete


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## brisvegas (30 December 2005)

*Re: PEM a lot of volume the last couple of days*

Have been reading up on zinc and have discovered some interesting facts regarding supply/demand and production deficits going forwards . if this all is true the future looks good for zinc producers 

have a read of this article 

http://www.yukonzinc.com/zincMarkets.htm

................. pete


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## brisvegas (30 December 2005)

*Re: PEM a lot of volume the last couple of days*

JP Morgan suggest zinc is the metal to rise in 06


*J.P. Morgan is bullish on zinc

Purchasing December 27, 2005  


Poor mine production growth in 2005 has left zinc smelters starved of concentrate, which has led to a deficit of refined metal, which has led to world prices 11% ahead of forecast. Revised forecasts for 2006 show another 9-10% increase.


Zinc is the only base metal in which J.P. Morgan Securities is forecasting a higher 2006 price average than the expected 2005 average. A constrained mine-concentrate supply situation, in combination with ongoing strong levels of demand for refined zinc by China, has left the 2005 market with an estimated deficit of 338,000 metric tons. Upshot: The 2005 price on the London Metal Exchange average annual price has risen to 63 ¢/lb from 48 ¢ in 2004. For 2006, a 201,000 metric ton deficit is projected. So, analyst Jon Bergtheil at J.P. Morgan’s nonferrous desk in London has raised the brokerage’s 2006 LME zinc price forecast to 67 ¢. While global growth for zinc metal is expected to rise 3.8% in 2006, he expects China’s demand to remain above a 10% growth rate of the past three years. This will maintain the deficit, Bergtheil says. "The expected deficit takes the world inventory level from the current levels of 6.5 weeks to a forecast 4.9 weeks by the end of 2006." *


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## brerwallabi (30 December 2005)

*Re: PEM a lot of volume the last couple of days*

Bris, a lot of good points on zinc in that link, and certainly Australian zinc companies reflect the ongoing demand and coming deficits in the current prices

ZFX about to test $7.00 again new highs, I really missed the boat on this one

KZL wow hit $2.30 new high earlier this morning - holding

PEM back up to $0.99 this could test $1.20 and possibly highs of previous year and test $1.40 if it gets through $1.20 - holding

CBH problems down to $0.20 no production atm but was upto .35cps before disaster hit mine tried to pick up at 16cps but damn did not fall that low, price will slowly come back to 30's but might take 12 months - no holding

2006 should be a good year for zinc imo


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## Ann (1 January 2006)

*Re: PEM a lot of volume the last couple of days*

Hi Brerwallabi,

Did you see this article?

*ZL hikes zinc, lead prices*

Primary zinc prices raised 5% to Rs 97,500 a tonne, lead by Rs 400 a tonne
Dilip Kumar Jha / Mumbai December 03, 2005
Hindustan Zinc, the largest domestic zinc producer, has on Thursday hiked prices of primary zinc (99.5 per cent purity, ex-Debari/ex-Chanderia) by more than 5 per cent to Rs 97,500 per tonne, from Rs 92,600 per tonne (last revision effective November 16).

Price of high-grade zinc, with 99.5 per cent purity, has been raised to Rs 97,300 per tonne against Rs 92,400 per tonne. With the current revision, prime western zinc (98.5 per cent) shot up to Rs 95,500 per tonne vis-a-vis Rs 90,600 per tonne.

Ex-Vizag and ex-other depot prices differ up to Rs 2,000 based on the order size and the location. Hindustan Zinc also raised lead prices, by only Rs 400 per tonne to Rs 56,400 per tonne from Rs 56,000 per tonne (as per the previous revision).

Domestic zinc leader Hindustan Zinc revises selling prices fortnightly based on the movement of zinc prices on the London Metal Exchange (LME). The company has a market share of about 85 per cent, while Binanis shares about 5 per cent and the rest by the secondary producers.

Balance of article...

http://www.business-standard.com/sm...mnu6&leftindx=6

Edit. Sorry that link doesn't seem to work. This is another link to Zinc. 
Moderators...please feel free to squish this post...it is a link to another forum.

http://www.shares.com.au/forum/showthread.php?threadid=597


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## brerwallabi (1 January 2006)

*Re: PEM a lot of volume the last couple of days*

Just found this.
"BEIJING: China will reduce its tax rebate on exports of some metals and products to 5 per cent, including zinc, tin and antimony, from January 1, 2006, the Ministry of Finance said yesterday.

The export tax rebate would be reduced for magnesium, tungsten, tin, zinc and antimony as well as for related products and for scrap tin, zinc and antimony, it said in a statement on its website.

It did not say what the current rebate was."

Why rebate when the price is going through the roof obviously the Chinese see the zinc price going further.


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## saichuen (12 January 2006)

*Re: PEM a lot of volume the last couple of days*

this one is looking good and moving up to test the $1.40 resistance level.


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## brerwallabi (13 January 2006)

*Re: PEM a lot of volume the last couple of days*

It might fly right through $1.40 without stopping, zinc up higher again and now past $US0.90 per lb, it should be PEM's best ever 6 months profit, remember there is some gold to take into account as well, its Daisy - Milano operation and Strike Oil which is 20% owned by PEM looks like being a winner as well for them.


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## Ann (14 January 2006)

*Re: PEM a lot of volume the last couple of days*

You have said it all Brerwallabi

...and a picture of it flying....in case someone doesn't chart.


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## carpets (17 January 2006)

*Re: PEM a lot of volume the last couple of days*



			
				saichuen said:
			
		

> this one is looking good and moving up to test the $1.40 resistance level.




Gone well above the resistance level now... A high today of 1.63, who would've thought? 
If you look at market depth, this afternoon there where only 2 sellers, one at 1.70 and one at about 1.83, any takers?


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## Ann (17 January 2006)

*Re: PEM a lot of volume the last couple of days*

That's absolutely amazing Carpets

Only two people selling with this quantity of trades for today after 12pm


PEM 	Perilya Limited FPO 	
Total Trades	Total Volume	Last Trade	V.W.A.P*
336	2,175,737	163	153.29
* Volume Weighted Average Price
Trade
Number (s)	Time  Last Traded	Price	Volume	Change	Value	Number
of Trades
330 - 336	4:15:55 pm	163	22,425	3	$36,553	7
325 - 329	3:59:07 pm	160	75,000	1	$120,000	5
321 - 324	3:58:56 pm	159	41,600	0.5	$66,144	4
320	3:58:20 pm	158.5	91	0.5	$144	1
318 - 319	3:56:39 pm	159	15,000	1	$23,850	2
316 - 317	3:55:41 pm	158	5,500	0.5	$8,690	2
315	3:54:31 pm	157.5	486	0.5	$765	1
310 - 314	3:53:01 pm	158	20,000	0.5	$31,600	5
308 - 309	3:49:43 pm	157.5	2,000	0.5	$3,150	2
307	3:48:18 pm	157	500	0.5	$785	1
305 - 306	3:48:16 pm	157.5	9,600	0.5	$15,120	2
304	3:48:03 pm	158	10,000	0.5	$15,800	1
293 - 303	3:47:52 pm	157.5	30,500	0.5	$48,038	11
290 - 292	3:37:18 pm	157	25,100	0.5	$39,407	3
285 - 289	3:27:36 pm	156.5	13,920	0.5	$21,785	5
283 - 284	3:24:32 pm	157	9,980	0.5	$15,669	2
278 - 282	3:22:37 pm	157.5	16,500	0.5	$25,988	5
274 - 277	3:16:46 pm	157	30,020	0.5	$47,131	4
272 - 273	3:08:17 pm	156.5	10,461	0.5	$16,371	2
264 - 271	3:05:38 pm	156	30,649	0.5	$47,812	8
259 - 263	2:57:56 pm	155.5	96,000	0.5	$149,280	5
249 - 258	2:51:35 pm	155	180,000	0.5	$279,000	10
247 - 248	2:42:21 pm	155.5	45,000	0.5	$69,975	2
243 - 246	2:41:31 pm	155	56,650	0.5	$87,808	4
239 - 242	2:39:17 pm	155.5	17,000	0.5	$26,435	4
231 - 238	2:32:03 pm	155	81,038	3	$125,609	8
230	2:27:32 pm	152	316	2.5	$480	1
226 - 229	2:27:32 pm	154.5	41,699	1.5	$64,425	4
218 - 225	2:20:12 pm	153	38,301	1.5	$58,601	8
213 - 217	2:09:46 pm	154.5	47,985	0.5	$74,137	5
210 - 212	1:50:10 pm	155	6,550	0.5	$10,153	3
207 - 209	1:49:35 pm	154.5	3,966	0.5	$6,127	3
201 - 206	1:37:34 pm	154	13,640	0.5	$21,006	6
198 - 200	1:21:26 pm	154.5	6,500	0.5	$10,043	3
197	1:13:14 pm	154	2,576	1	$3,967	1
196	1:06:18 pm	153	600	0.5	$918	1
195	12:59:20 pm	152.5	1,000	0.5	$1,525	1
194	12:59:20 pm	153	1,000	1	$1,530	1
191 - 193	12:48:47 pm	154	37,424	0.5	$57,633	3
190	12:48:47 pm	154.5	10,000	0.5	$15,450	1
186 - 189	12:32:07 pm	155	13,000	1	$20,150	4
184 - 185	12:27:24 pm	154	20,349	1	$31,337	2
164 - 183	12:18:05 pm	155	78,287	0.5	$121,345	20


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## brerwallabi (17 January 2006)

*Re: PEM a lot of volume the last couple of days*

Well they didn't blame me for their speeding ticket today, I have been trying to work out the performance of PEM, the expected profitabiilty and its damn hard with a moving dollar and the price of zinc escalating. I had hoping about 1.40 to 1.50 on PEM I am still holding I think there could be further upside seeing also some analysts are now saying they could dispose of Daisy Milano and that would  certainly add a fair bit of cash to their balance sheet, some interesting days ahead. I wish I could find a few more of these, a Corolla to a Ferrari in days and still no stopping it.


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## brerwallabi (27 January 2006)

Geez this is going through the roof $0.98 to $2.07 in a month, its going to be hard to better this and we are only 4 weeks into the new year. Zinc is still increasing in price PEM's next six months wil be even better.


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## tony2252 (27 January 2006)

bought this one at a $1 sold 1.33 bought again $2.00. 

I thought 33% was good profit if only i held on! I thought it could not keep running.


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## yogi-in-oz (22 April 2006)

Hi folks,

PEM ..... price pulled back last week, but will be 
alert for some significant and positive news,
this week .....:

Key days for PEM, may be:

24-26042006 ..... spotlight on PEM and aggressive rally???

    08052006 ..... 2 cycles here - significant and positive 
                         news ..... finance-related???

    22052006 ..... minor time cycle.

    26052006 ..... minor 

    02062006 ..... significant financial  news???

    06062006 ..... minor but positive cycle???

    12062006 ..... significant and negative cycle

    26062006 ..... positive and minor cycle

    28062006 ..... minor

happy days

   yogi


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## Halba (23 April 2006)

tony i did the same thing!


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## michael_selway (22 July 2006)

yogi-in-oz said:
			
		

> Hi folks,
> 
> PEM ..... price pulled back last week, but will be
> alert for some significant and positive news,
> ...




Hi any updates for the furture?

thx

MS

http://www.smh.com.au/news/business...-at-broken-hill/2006/07/19/1153166457776.html



> Perilya takes a wider view and finds more in reserve at Broken Hill
> Email Print Normal font Large font Isabelle Oderberg
> July 20, 2006
> 
> ...


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## Sean K (9 October 2006)

PEMs had a good couple of weeks, looks set to test resistance at $3.10 ish. Needs to break this on volume for a more positive break upward. 

Generally trending up since mid June low. 

Kipp, your PM box is full.


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## itchy (25 October 2006)

PEM going for it the last few days, past resistence and at an all time high!
why is it always considered the poorer sister of KZl and ZFX ???


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## michael_selway (25 October 2006)

itchy said:
			
		

> PEM going for it the last few days, past resistence and at an all time high!
> why is it always considered the poorer sister of KZl and ZFX ???




PEM mainly mine life is the issue, its only about 6 yrs i think, so shorter than ZFX, CBH, KZL etc

but nevertheless, they should all rise if zinc prices rise etc

thx

MS


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## Brasidas (30 October 2006)

There is a good discussion of the next "nickel" sector - zinc - in this week's Minesite weekly roundup which is here in full.

That Was The Week That Was … In Australia 

By Our Man In Oz

Minews. Good morning Australia, another week, another record?

Oz. It certainly was for some stocks, especially those selling zinc and nickel to the steel industry. You probably saw the same reports we did down this way, that the world has almost run out of zinc, and the nickel price is showing no sign of retreating from its astonishingly high levels. The end result, naturally, is that zinc stocks such as Zinifex (ZFX), Perilya (PEM), CBH (CBH), Kagara (KZL) and Terramin (TZN) have moved into the stratosphere, joining the nickel brigade who where already up there.

Minews. A few price examples please?

Oz. Zinifex hit a 12-month high of A$15.05 during Friday trade, before settling back to close the week at A$14.65, a gain of A$1.14 (8.4 per cent), Perilya was up A70 cents (20.8 per cent) to A$4.05, down a fraction on its 12-month high of A$4.10 reached on Thursday and Friday. Kagara also set a 12-month high on Friday of A$7.34, before easing back to A$7.21, still up A82 cents (12.8 per cent). CBH, which received a severe setback at this time last year with a stope collapse in its Endeavour mine, was up A5.5 cents (8.8 per cent) to A67.5 cents, also a modest retreat from its high of A73.5 cents set on Thursday. Terramin, which is developing a small zinc mine close to Adelaide in South Australia, was up A14 cents (8.9 per cent) to A$1.70, down from a Thursday high of A$1.75.

Minews. And the nickel sector was strong again?

Oz. Yes, but not to the same extent as the zincs. Jubilee (JBM), which held its annual meeting during the week and said takeovers were off its agenda, was up a modest A20 cents (1.6 per cent) to A$12.60, down on its cracking start to the week when the stock hit a 12-month high of A$12.98. Western Areas (WSA) put on A25 cents (7.4 per cent) to close the week at A$3.64, also down from its 12-month high of A$3.79 set on Tuesday, and Minara (MRE) was up A11 cents (2.2 per cent) to A$5.20, which was some distance behind its 12-month high of A$5.55 set last week.

Minews. It looks from those price movements that the nickel sector is awfully close to a peak?

Oz. It would seem that way. It also seems to be the same with a number of the stocks exposed to the bulk end of the market where the future direction of iron ore and coal prices is being questioned. There were no dramatic falls, but the rises were modest, and not helped by a bit of corporate fiddling. Aztec Resources (AZR), which has been struggling with a takeover bid from rival Mt Gibson (MGX), and the sudden discovery of a royalty on its Koolan Island iron ore project, which it forgot to tell everyone about, resumed trading after a period in the sin bin, but hardly inspired. Volume was high on Thursday and Friday but the price only moved between A23 cents and A24 cents. There might be more to come on that royalty fiasco. Aztec’s takeover suitor, Mt Gibson, was treated more harshly, dropping A1.5 cents (2 per cent) to A70.5 cents. At the top end of the iron ore hopefuls, Fortescue Metals (FMG) returned to favour with a A78 cents (8.8 per cent) rise over the week to close at A$9.58.

Minews. And presumably your uranium stocks were hot after the production problems in Canada?

Oz. A strong week for that sector with most stocks trending up. Paladin (PDN) reached a 12-month high on Wednesday of A$6, but then fell away quite sharply to close on Friday at A$5.46, which was still up A54 cents (11 per cent) on the week. Pepinnini (PNN) also set a new high mark, trading up to A75 cents on Friday before easing back to close at A73 cents, still up A5 cents (7.4 per cent) for the week.

Minews. Much on the downside?

Oz. Very little, even the gold sector, which has been a bit of a laggard, managed to deliver some strong performances. Agincourt (AGC) reported good drill results from its Calais prospect near Wiluna and gained another A5 cents (4 per cent) to A$1.25. More importantly, last weeks’ rise took the gain over the past nine trading days to A25 cents (25 per cent). The only fall really worth noting was Consolidated Minerals (CSM) which dropped A10 cents (4.2 per cent) to A$2.30 as the takeover frenzy which gripped the stock earlier in the month seemed to run out of puff.

http://www.minesite.com/storyFull5.php?storySeq=3894


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## michael_selway (4 November 2006)

anyone holding PEM?

thx

MS


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## itchy (4 November 2006)

yeah i got PEM! i am really enjoying the ride, picked them up at 80cents the end of last year!
Now im just hoping CBH will follow in their foot steps!  
I dont really understand why they dont get nearly as much publicity as the KZl's and ZFX's on the frums!
Well im happy to hold them in silence!


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## michael_selway (4 November 2006)

itchy said:
			
		

> yeah i got PEM! i am really enjoying the ride, picked them up at 80cents the end of last year!
> Now im just hoping CBH will follow in their foot steps!
> I dont really understand why they dont get nearly as much publicity as the KZl's and ZFX's on the frums!
> Well im happy to hold them in silence!




**** nice, 80c

thx

MS


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## Sean K (4 November 2006)

MS, what's the pe of all these Z stocks running like the wind? Surely they're catching up to fair value, or exceeded?


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## nizar (4 November 2006)

kennas said:
			
		

> MS, what's the pe of all these Z stocks running like the wind? Surely they're catching up to fair value, or exceeded?




usually the pe doesnt run up that much when the EARNINGS are exceeding the share price appreciation!
CBH pe 7.5, ZFX pe 5.4, KZL pe 10.4
(and please dont tell me KZL looks overvalued as *its not*)

i suspect CBH will earn 13.5cps this year, ZFX $4+ and KZL $1+
(my opinions based on my calcs of $100m, $2b, and $200m in NPAT respectively)

so if the market is willing to pay the same earnings multiple as they are currently for these stocks, then KZL $10.40, CBH $1 and ZFX $21.60, though i suspect they market will pay a higher earnings multiple for them, so the upside is very clear.


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## michael_selway (5 November 2006)

kennas said:
			
		

> MS, what's the pe of all these Z stocks running like the wind? Surely they're catching up to fair value, or exceeded?




*ZFX* - Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS 219.9 296.8 238.1 140.9 
DPS 80.0 131.3 98.0 69.0 

*KZL* - Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS 16.8 69.9 63.0 43.0 
DPS -- 5.0 6.3 0.0 

*PEM* - Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS 42.1 75.3 68.1 40.6 
DPS 5.0 11.5 13.6 14.8 

*CBH* - Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS -2.8 10.2 9.7 16.8 
DPS -- 0.0 4.0 10.0 

*JML* - Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS -2.2 1.3 17.5 21.6 
DPS -- 0.0 0.0 0.0 

*OXR* - Earnings and Dividends Forecast (cents per share) 
2005 2006 2007 2009 
EPS 5.6 37.0 31.4 23.9 
DPS 1.0 6.0 5.0 4.2 


thx

MS


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## pacer (5 November 2006)

Thanks Mike....certainly throws the light on the real performers....Still holding KZL and ZFX....I'm already a week overdue for my sell point....gets a bit scary when you play outside your system eh?

Somehow convinced myself there might be a bit more in these....slap me!


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## Sean K (5 November 2006)

michael_selway said:
			
		

> *ZFX* - Earnings and Dividends Forecast (cents per share)
> 2006 2007 2008 2009
> EPS 219.9 296.8 238.1 140.9
> DPS 80.0 131.3 98.0 69.0
> ...




Cheers. CBH still looks like it will be the best value on current prices, if it delivers. No?


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## michael_selway (6 November 2006)

kennas said:
			
		

> Cheers. CBH still looks like it will be the best value on current prices, if it delivers. No?




man all zinc stocks are goign crazy atm, PEM the most imo!

thx

MS


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## nizar (6 November 2006)

kennas said:
			
		

> Cheers. CBH still looks like it will be the best value on current prices, if it delivers. No?




Agree.
But all ZFX, CBH and PEM are in blueskies at the moment. KZL will be shortly i suspect zinc spot just touched to us$2/lb!!


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## itchy (16 November 2006)

Interesting to see PEM was actually up today. justover 2%
i guess it did fall harder than some of th eothers though.
lets hope she sets a precident for the rest of the zinco's


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## michael_selway (21 November 2006)

itchy said:
			
		

> Interesting to see PEM was actually up today. justover 2%
> i guess it did fall harder than some of th eothers though.
> lets hope she sets a precident for the rest of the zinco's




PEM's held up well

*Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS 42.1 77.9 70.6 52.3 
DPS 5.0 10.8 12.0 14.0 

EPS(c) PE Growth 
Year Ending 30-06-07 77.9 5.4 85.2% 
Year Ending 30-06-08 70.6 6.0 -9.4% * 

thx

MS


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## michael_selway (28 December 2006)

Does anyone still own this stock?

*Earnings and Dividends Forecast (cents per share) 
2006 2007 2008 2009 
EPS 42.1 103.5 88.6 89.2 
DPS 5.0 14.8 13.6 12.8 

EPS(c) PE Growth 
Year Ending 30-06-07 103.5 4.7 146.0% 
Year Ending 30-06-08 88.6 5.5 -14.4% * 

thx

MS


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## mmmmining (28 December 2006)

michael_selway said:
			
		

> Does anyone still own this stock?
> 
> *Earnings and Dividends Forecast (cents per share)
> 2006 2007 2008 2009
> ...




I feel so good about this one that I don't check the SP very often.


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## brerwallabi (28 December 2006)

michael_selway said:
			
		

> Does anyone still own this stock?




Yes, ever since I started this thread I think some three years ago.


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## michael_selway (28 December 2006)

brerwallabi said:
			
		

> Yes, ever since I started this thread I think some three years ago.




oh ok and you didnt sell any of it yet right?   

thx

MS


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## brerwallabi (28 December 2006)

Michael
Read my previous posts I have traded this over a three year period and have made 22 entries and 21 exits I just took the trouble to check for you.
Last entry 4.63 and still holding, I like to get to know a company well.

It was still looking very very cheap last week, not so much today but still cheap....
The market has finally got some confidence in PEM it has had a few years of false promises and non performance but the last 12 months has seen some operational issues being addressed and production targets coming through.
Flinders approval just come through very high grade project.
Mine life at Broken Hill also looks to be further extended.
Looks like it will be a big cash cow.
Much will now depend on the price of zinc I presume your figures have been worked out at the around price assumptions of US$1.70lb try US$2.00. 
Yes it looks even better doesn't it.


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## Moneybags (10 January 2007)

Tragedy today for PEM workers at Broken Hill mine with a fatality overnight.
Condolences to family.
Operations temporarily suspended.

MB


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## mmmmining (7 February 2007)

Zinc price recovered well. So are most zinc producers. Why this one is not? Anyone knows? Maybe a good trading opportunity?


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## UraniumLover (12 February 2007)

Gold is doing well, zinc prices is on recovery, well stabilized at 1.40. Back to what it was 6 months a go from about 3 months.  LME stock levels have been declining for last month, but a large increase yesterday. Don't think there is much more down side.


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## legs (23 April 2007)

*Re: PEM - where too now?*

Just want your opinion on where this stock could be heading??? Has been down on last years highs over $5....can it get back up there??


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## legs (27 April 2007)

Damn missed the nice rise last few days...down today but I believe there is lots more upside...anyone???


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## legs (3 May 2007)

$4.62 how far is this boat going???? Always the way....you say you like it, you consider getting in, you don't and YOU are an IDIOT!! Up 15.5% in 10 days great cash reserves still. Zinc is strong.


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## Love Zn (3 May 2007)

The boat is still along way from it's high of $5.80 and it appears that it's rise back to that level (in % terms) is slower compared to ZFX and KZL.

But with the way the LME price was going this week, I must say the boat ride is enjoyable


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## legs (21 May 2007)

Perilya, Australia's third-largest zinc producer, jumped 9.8 percent to A$4.50, after Goldman Sachs JBWere upgraded its rating on the firm to buy from hold, citing its attractive valuations and strong earnings per share growth potential in fiscal 2008.


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## Love Zn (21 May 2007)

And here is me thinking it might have been something to do with KZL being on hold.  Always so many merger/take over talks with the three Aussie Zinc Companies.


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## legs (31 May 2007)

chart for PEM. Nothing real exciting here but trying out attaching a graph. Hope it works so i can add this info to my posts.


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## Tye (20 June 2007)

perilya, starting to climb its way back up to the top. Has had a poor year so far but has broken most recent high. Zinifex has led the charge back in zinc shares so far so lets hope perilya can match it. The next obvious resistance is $5.


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## Bazmate (20 June 2007)

There's a bit of action in the share price all of a sudden, not that I'm complaining, this one has been in my bottom drawer for a while.... No news that I can find other than dropping zinc price... Any ideas?

Upcoming announcement perhaps?


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## Lachlan6 (20 June 2007)

Just a quick opinion on (PEM) technically. It looks like its at a very important juncture at the moment. It has just pushed through the important 50% level from Jan 07 highs to the double bottom in March and its next big test seems like the gap refill area from Feb at $5.02. If it can push through this then the old highs should be reached.


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## Love Zn (20 June 2007)

Good graph Lachlan.  I was very surprised with PEM today, I was fully expecting this to bounce down off the $4.72-75 resistance, especially with the Zinc price dropping over night.  I've also got my next resistance at $5.00 and then think around $5.40 and finally $5.70-75 on the way up.

ZFX did well yesterday and PEM today, maybe it's KZL's turn tomorrow :


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## reece55 (20 June 2007)

Bit of a weak close, but still she's looking very nice at the moment.

Just for amusement, attached is the weekly chart. Assuming we have entered our wave 5 (which I believe we have), here are the potential extended wave 5 targets as wave 3 was less than a 1.62 extension.....

	   Start    Finish   Movement	% on W1
W1	 $0.80 	 $3.61 	 $2.81 	
W3	 $1.92 	 $5.80 	 $3.88 	        138.08%
Potential targets as wave 3 was less than a 1.62 extension				
.62 of W 0 - 3			$6.62 	
1 of W 0 - 3			 $8.52 	
1.62 of W 0 - 3		      $11.62 	

Would be incredible even if we got the first outcome!!!

Cheers


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## reece55 (20 June 2007)

Ah, crap, my wave 4 overlaps wave 1 for two days, only by 9 cents or like 2.5%!!!!!......

Any EW experts out there (Nick, Kauri, Wavepicker, etc.), I know that they say that only leveraged instruments are allowed to overlap, but there is no way the count is valid???? What a pain in the ****, because it looked so clean....

Cheers
Reece


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## countryboy (3 July 2007)

PEM on boardroom radio today. Production is getting back to where they want and with Flinders ranges project about to kick off forecasts should be good for 2008. Pinacles mine some 10k out of town-Perilya should have a look at this.Good M & A prospect with a number of efficiencies that could be made due to its location.


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## countryboy (8 July 2007)

JV /maybe merger .....my source had too much too drink so I will suss out some more will be announced some time soon.Shares in the other company will be worth more. Countryboy will do some more wining and dining to find out what is going on....and of course buy shares in this company before he tells anyone else but ASF has been told first !!!


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## rustaman (8 July 2007)

countryboy said:


> JV /maybe merger .....my source had too much too drink so I will suss out some more will be announced some time soon.Shares in the other company will be worth more. Countryboy will do some more wining and dining to find out what is going on....and of course buy shares in this company before he tells anyone else but ASF has been told first !!!





Seems like your cousin "bushkid" got to blather first on HC at 00.08am. 

Wine and dine on boyo.


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## Tye (17 July 2007)

Pem is starting to bang it head around $5.  Fair bit of resistance here. With zinc rising to 3-month highs a break above $5 may see perilya going for a nice move. also zinc stockpiles are falling quite fast. This also helps. Cant wait for the break (if so)


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## Tye (18 July 2007)

not looking to shabbby up 10c in a falling market. This is always a good sign of continuing strength.


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## countryboy (19 July 2007)

Sydney - Thursday - July 19: (RWE Australian Business News) - 
Perilya Ltd (ASXEM) has reported full-year production from Broken Hill of 92,100 tonnes of zinc and 60,500 tonnes of lead. Increased June quarter production of 22,000 tonnes zinc and 14,500 tonnes lead, coupled with higher lead prices, resulted in net cash operating costs of US58c/lb, 60pc lower than the previous quarter. Cash operating margin of US85c/lb zinc was comparable to that achieved in the first half of 2006/07. The fifth anniversary of Perilya's ownership of the Broken Hill mine was marked on June 1. Since acquisition, the operation has produced 642,000 tonnes of zinc, 298,000 tonnes of lead and 8.6 million ounces of silver. During this period, the ore reserve has been broadly maintained. At Flinders, open-pit mining operations at Beltana continue ahead of schedule and under budget. A total of 10,544 tonnes of high-grade ore at an average grade of 33.9 per cent zinc was mined during the quarter. Resource drilling at Reliance has returned "excellent" results, including 36 metres at 31.8pc zinc from 58 metres. The process of obtaining development approvals has commenced for the Reliance, Moolooloo, Aristotle and Aroona2 deposits, located within 15 kilometres of the Beltana operation.

the lower you go at BH you tend to pick up more lead- according to some old miners.One of the middle levels will be mined out this year and so the focus will be a bit deeper.Its all super quality ore mind you.

For my money PEM will need a substantial aquisition to take it foward in the next 10 yrs. Worth watching


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## Tye (10 August 2007)

30% fall in 3 weeks. This was looking great 3 weeks ago. Does anyone think that this can ever be recovered, because a belting like that is never good for investors and traders. I heard it was cheap at over $5 now its under $4. This share is so volitile.


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## UMike (10 August 2007)

Must say I had a bit of a nibble on it today.
.

Did about $24 mil in trade throughout the day though.


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## countryboy (11 September 2007)

from todays australian:

Perilya (PEM) $3.77Font Size: Decrease Increase Print Page: Print Tim Boreham | September 11, 2007 
HAVING twice given the nod to the Broken Hill base metals producer and twice been chastened, Criterion is loath to give Perilya the benefit of the doubt.

Yet Perilya's numbers look compelling. Despite a sharp retraction last week, lead prices have still doubled this year while zinc continues to be in tight supply. At the same time, Perilya is emerging from the production hiccups stemming from the death of a worker in January's underground accident. 

In the wake of the tragedy, 2007 production slid dramatically to 92,800 tonnes of zinc and 61,000 tonnes of lead, from the previous year's 144,000 tonnes and 75,000 tonnes respectively. The lower production affected per-tonne costs, as did the use of lower-grade ore. The buoyant prices saw Perilya post a "record" $82.5 million for the year to June 30, 2007 (take out asset sales and the result was less glossy). 

Perilya forecasts current-year output of 120,000-140,000 tonnes of zinc and 70,000-80,000 tonnes of lead. There's also 28,000 tonnes of 35 per cent grade ore stockpiled at the Flinders Zinc (Beltana) project in South Australia, expected to be sold in the December quarter. 

Broker Patersons notes that Broken Hill grades should improve as Perilya moves to higher-grade stopes. 

An unabashed fan of the stock, Patersons forecasts a current-year net result of $119 million and earnings per share of 67.1c, which puts the stock on a miserly PE ratio of 5.6 times. This assumes an average zinc price of $US1.14 a pound, compared with the current $US1.28/lb. 

Goldman Sachs JB Were's Perilya watchers are more grudging, noting in part that Perilya paid a 1c dividend when the firm expected 10c. Presumably Perilya -- sitting on cash reserves of $173 million -- is eyeing an acquisition. 

As with Zinifex's Century mine, Broken Hill has a short (six-year) mine life. Perilya is moving away from its flagship Broken Hill through the Beltana project, which is "on schedule and below budget". 

Criterion rated Perilya a buy at $5.37 on January 31 and then again at $4.23 on February 8. Laughable calls, perhaps, but if Perilya's production recovers, the stock looks laughably cheap. 

For a third time we say buy, but any more hiccups over the next year and it's bye-bye.


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## Ken (27 September 2007)

PEM doesnt seem to have recovered as much as MMX or MCR or MIS from its lows.

Any ideas why?


I wanted to pick some up after I heard the Patersons report online.

But I am just going to wait and see, am riding the financials at the moment.


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## michael_selway (28 September 2007)

Ken said:


> PEM doesnt seem to have recovered as much as MMX or MCR or MIS from its lows.
> 
> Any ideas why?
> 
> ...




Well zinc price is not that hot as yet, plus they do have a limited 6 year mine life.

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 66.0 64.8 50.3 
DPS 11.0 17.0 16.0 12.3 *

thx

MS


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## dj_420 (11 October 2007)

There are a lot of concerns though this one is a nice bluechip that has not recovered well since correction.

I bought in yesterday at 4.05 on open, I liked the look of this one, trading on a PE of 6 and expected earnings upgrades will put this one back in favour IMO.

The short mine life is a concern, though PEM are well cashed up and rumoured to be on the prowl.


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## mishu (2 November 2007)

*PEM - Perilya holding up well*

With the market like it is today I notice PEM is holding up well.  Even flat at one stage. Also I note that AMP increased its holding to 5 percent in yesterday's notices. The company looks strong and safe with its ongoing operational mines, hedged dollar, hedged lead prices and money to expand. Its hedged for a dollar above 83 cents. 

There is some discussion about whether it might be a takeover target itself on other forums. Having good assets makes that more likely but they also have a lot of cash on hand which they intend to use to expand. They are evidently in talks about a joint operation with another company for a mine near the Broken Hill region.


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## michael_selway (2 November 2007)

*Re: PEM - Perilya holding up well*



mishu said:


> With the market like it is today I notice PEM is holding up well.  Even flat at one stage. Also I note that AMP increased its holding to 5 percent in yesterday's notices. The company looks strong and safe with its ongoing operational mines, hedged dollar, hedged lead prices and money to expand. Its hedged for a dollar above 83 cents.
> 
> There is some discussion about whether it might be a takeover target itself on other forums. Having good assets makes that more likely but they also have a lot of cash on hand which they intend to use to expand. They are evidently in talks about a joint operation with another company for a mine near the Broken Hill region.




Well its not bad although 2008

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 61.4 69.7 42.8 
DPS 11.0 15.9 16.6 12.6 *

thx

MS


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## mishu (5 November 2007)

*Re: PEM - Perilya holding up well*



michael_selway said:


> Well its not bad although 2008
> 
> *Earnings and Dividends Forecast (cents per share)
> 2007 2008 2009 2010
> ...




Thanks for that info Michael.  I don't recall seeing it before. Where was it from? Do you like the share? It looks good again today - its up today when the market is down.


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## UMike (6 November 2007)

It's really diving now 

An almost 1 grand profit is now more than negative 1 grand.

Can this one turn around?


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## UMike (6 November 2007)

LOL

Lost 3% before going back to $3.67.

This share is crazier than KCN :lol:

Hopefully this recovery continues.


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## mishu (6 November 2007)

Yeah it is volatile. That can be good as well as bad. It can mean a faster rise up again. My partner made significant gains on this stock earlier this year. He bought back in recently and is happy to hold.


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## michael_selway (6 November 2007)

mishu said:


> Yeah it is volatile. That can be good as well as bad. It can mean a faster rise up again. My partner made significant gains on this stock earlier this year. He bought back in recently and is happy to hold.




Hi Mishu, why are you guys buying it? doesnt it have a relatively short mine life i.e. 6 years about?

thx

MS


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## Ken (6 November 2007)

Perilya is cashed up and on the prawl for an acquisition. 

If they continue to fall the stock will become a takeover target certainly.


Watch this space.

Dont go bottom picking.

Fundamentals come into resource stocks, forward looking eps are deceptive because they also rely on commodity prices.

Worth noting that PEM is a top ten lead producer in the world.

So they are not a small speculative stock. 

I think they are unloved because of the short mine life.

An acquisition of another company could very well give investors long term confidence to get stuck in.

There are several target prices of $4-$5.20


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## mishu (7 November 2007)

It has two active mines and plans for 4-5. It has the sites and money to develop them. We think the share is very good value currently and we expect a good return on it over the next two-three months.


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## mishu (7 November 2007)

It's up 4 and a half percent today. I am convinced that this stock has good prospects- both on its own merits, and also either through acquiring or being acquired.


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## GREENS (8 November 2007)

Have to say, when people talk about PEM being one of the biggest Lead producers and benefiting greatly from the rising price of Ld, one needs to only look at their hedging strategy for the metal for the 08 and 09 Financial years to see, that although they may be the among the biggest producers they would certainly not be among the top earners for the metal. They have close to 50% of their Lead production hedged for 08 @ approx AU$0.75/lb and for 09 @ approx AU$0.80/lb. When Ld has been currently hovering around AU$ 1.80/lb, no wonder investors aren’t poring in for the exposure to Ld, because if investors did want exposure to Ld your probably be better off jumping on other miners that are producing way less but are fully unhedged and have greater diversity in their metal production to also take advantage of higher Cu, Ag & Au prices. I was looking at the company because it appeared to be good value, but considering the price of Zn at the present time and the grim outlook over the feasible future, the low profit margin compared to its peers, the short mine life and the relatively high cost of production at broken hill, it was obvious why it traded on such a low PE multiple. After looking at these basic fundamentals I didn’t even bother looking at the company’s development and exploration, so maybe I am missing something and this is where the value of the company really lies. However one good thing to come out of its hedging plan is that it hedged against the AUD/USD at an ER around $0.83, which will benefit its Zn sales compared to other miners. Still trading on a PE of 8 to me says that surely this hasn’t got too much more downwards movement, unless their current mine experiences some server output problems or Zn heads sharply south. So maybe its one for the bottom drawer, but the question is how long will it have to stay in the bottom drawer to earn its rewards? Nevertheless the brokers seem to place high hopes for it, so good luck to all those that hold.


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## mishu (12 November 2007)

PEM has bought a significant holding(8%)in Herald which is developing a mining site with excellent lead and zinc resources in Indonesia. Production and Labor costs should be lower there.


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## mishu (12 November 2007)

Greens I think you misunderstand PEM's position. 

From a financial report they submitted to the ASX:

"Metal Put Options
The company has acquired put options over approximately 50% of forecast lead sales to June 2009. These put options
provide the right, but not the obligation, to sell lead at an agreed strike price at a future date (refer to Table 4 on page 10).
The overall effect of these USD lead put options and the AUD call options is a minimum gross achievable price of
A$3,316 per tonne on the 30,221 tonnes hedged for the balance of FY08, and A$2,666 per tonne on the 38,701 tonnes
hedged in FY09, whilst maintaining upside exposure to a rising lead price and/or a weakening AUD."


----------



## GREENS (12 November 2007)

mishu said:


> Greens I think you misunderstand PEM's position.
> 
> From a financial report they submitted to the ASX:
> 
> ...




Mishu 

Yes you are correct in saying they have 50% hedge of there Ld production using put options, but they have also entered into forward contracts (which I would assume to be a short and not a long position) for the sale of the other 50% of Ld production. Refer to page 10 of their latest quarterly report, its all there. This means that they will have a loss on their put options and have forgone significant revenues from entering into their forward contracts at such low prices. Forward contracts are an obligation to deliver a certain amount of contained Ld at a particular price you don’t have any choice whether you want to exercise or not.

08 Forward Contracts – 25,006t @ $AU 1,447/tn & 4,794t @ $US 2,446/tn & additional put options as you mentioned. Adding to this is their small position in Zn Forwards 18,000t @ $AU 2,466/tn.

09 Forward Contracts – 33,242t @ $AU 1,748/tn and small position in Zn again 16,246t @ $AU 3,768/tn.

10 Forward Contracts – 5,460t @ $AU 3,359/tn

If you can prove this to be wrong, I would be quite happy, because then maybe PEM would be worth considering in a market where value is hard to find.


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## michael_selway (12 November 2007)

GREENS said:


> Mishu
> 
> Yes you are correct in saying they have 50% hedge of there Ld production using put options, but they have also entered into forward contracts (which I would assume to be a short and not a long position) for the sale of the other 50% of Ld production. Refer to page 10 of their latest quarterly report, its all there. This means that they will have a loss on their put options and have forgone significant revenues from entering into their forward contracts at such low prices. Forward contracts are an obligation to deliver a certain amount of contained Ld at a particular price you don’t have any choice whether you want to exercise or not.
> 
> ...




Hi there 6 yr mine life is still an issue i think

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 61.0 69.7 56.5 
DPS 11.0 15.4 16.4 15.0 *

thx

MS



> Date: 15/10/2007
> Author: Michael Vaughan
> Source: The Australian Financial Review --- Page: 22
> Australian-listed base metals group Perilya will pursue acquisitions in order tosignificantly boost its market capitalisation. Perilya is currently valued atless than $A1bn, but CEO Len Jubber says the group's aim is to increase itscapitalisation to more than $A2bn. Perilya will seek to acquire a base metalproject in the near-term, although Jubber says the group wants to ensure that itbuys the right asset at the right price. Perilya shares eased $A0.17 on 12October 2007, closing at $A4.25
> ...


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## mishu (13 November 2007)

GREENS said:


> Mishu
> 
> Yes you are correct in saying they have 50% hedge of there Ld production using put options, but they have also entered into forward contracts (which I would assume to be a short and not a long position) for the sale of the other 50% of Ld production. Refer to page 10 of their latest quarterly report, its all there. This means that they will have a loss on their put options and have forgone significant revenues from entering into their forward contracts at such low prices. Forward contracts are an obligation to deliver a certain amount of contained Ld at a particular price you don’t have any choice whether you want to exercise or not.
> 
> ...




The forward contract sales are there alright. And yes they are at low prices. But the rest of the product will likely be at better prices than the rest of the market will get. PEM's financials are on target for the expected profit as of the last financial report. (Unlike ZFX, they have not issued a profit downgrade).  I have asked  PEM to clarify the position regarding the forward sales and the projected minimum price attainable - no answer as yet, but I truly do not see the pre-sales as a bar to a growing company, well managed, and developing into Indonesia in all likelihood. 


Regarding mine-life, I am not expecting to have to hold the share 6 years  When the first Flinders project sales are made this quarter i believe they will boost figures and result in a very good December quarter report.  However, investment in Herald for its rich Indonesian mining sites and extended exploration for other open and other mining prospects continues. 

You can see about the ongoing exploration and development of sites in the latest quarterly report.


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## mishu (14 November 2007)

I note that ZFX has recently announced it expects lower revenues than predicted due to the falling price of zinc and the high dollar and rising mine costs. (Apparently brought on by analysts lowering their outlook for zinc prices to 1.25 per pound from 1.75)

Relevant to that I note that PEM has evidently taken into account lower zinc prices when plannign their mining viability , cash flow and profits, has hedged against the dollar,  is ahead of forecasts and below costs on the Beltana zinc production, and is actively exploring other avenues of lowering mining costs, including the Potosi deposit and the later possibility of taking over Herald.

(Information from various articles and reports)

http://www.bloomberg.com/apps/news?pid=20601081&sid=aLmmqc4bcYlo&refer=australia

http://www.news.com.au/heraldsun/story/0,21985,22754890-664,00.html

http://72.14.253.104/search?q=cache...e+of+zinc+"&hl=en&ct=clnk&cd=1&gl=au&ie=UTF-8

http://www.theaustralian.news.com.au...-23634,00.html 

http://au.us.biz.yahoo.com/ft/071112...3103.html?.v=1


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## mishu (15 November 2007)

http://asx.com.au/asx/statistics/showAnnouncementPDF.do?idsID=00783243

Good news here. Doubles the copper resources of PEM and increases suitability for open cut mining.


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## michael_selway (15 November 2007)

mishu said:


> http://asx.com.au/asx/statistics/showAnnouncementPDF.do?idsID=00783243
> 
> Good news here. Doubles the copper resources of PEM and increases suitability for open cut mining.




Hi how much does that increase its mine life by?

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 61.0 69.7 56.5 
DPS 11.0 15.4 16.4 15.0 *

thx

MS


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## GREENS (16 November 2007)

Mishu

Back to my original points. People have been suggesting:

1. That Perilya has substantial leverage to currently high Ld Price. My point was that yes they still do have 50% of production unhedged but their other 50% is hedged at considerably low prices. Investors can gain this same exposure through other companies with smaller production which are fully unhedged, yet have more attractive exposure to Cu, Au &/or Ag which have been performing much better than the other metals of late. Thus the reason why investors aren’t rushing in for the exposure, to the higher lead prices. Please let me know if this is incorrect when you hear back from the company, because as you can see from reading the report, it obviously says they have future contracts amounting to the volumes discussed in my previous post. 

 2. It is good value because it is trading on a low PE multiple. The fact that you wont be holding until the mine exhausts its resources in 6 years is not the point (even though it is likely this mine will continue producing for longer, as each mine manager has been saying this for ages).  But current short mine life combined with high costs of production and relatively lower margins compared to its peers clearly justifies why it trades at a discount and inturn on a low PE multiple. Add the poor performance of the Zn price of late with the grim outlook from brokers for the rest of 2007/08 and things aren’t looking so crash hot. I think the fact that PEM has only managed profit margins of 19.5% (06) and 21% (07) in a major commodities bull market speaks loud and clear.

As I said before I did not get into the nitty gritty of their exploration and development, just had a brief glance, so could be missing something here, feel free to elaborate on this if there is anything important. Nevertheless brokers seem to like it and think it is undervalued so maybe your short term view will pay off.


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## mishu (16 November 2007)

They have active ongoing exploration and hold many promising sites Greens. Did you see yesterday's announcement?  They had drilling results showing a doubling of their copper resource at Mt Oxide - and good suitability for open cut mining.


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## michael_selway (17 November 2007)

mishu said:


> They have active ongoing exploration and hold many promising sites Greens. Did you see yesterday's announcement?  They had drilling results showing a doubling of their copper resource at Mt Oxide - and good suitability for open cut mining.




Hi in terms of mine life.how much would that be?

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 43.1 61.0 69.7 56.5 
DPS 11.0 15.4 16.4 15.0 *

thx

MS



> Date: 12/11/2007
> Author: Michael Vaughan
> Source: The Australian Financial Review --- Page: 16
> On 8 November 2007, listed Australian miner, Perilya, purchased five millionsshares in Herald Resources from Renaissance Capital. It is not expected thatPerilya will launch a takeover bid at this stage, although CEO Len Jubberrecently indicated that Perilya aims to purchase a base metal miner by 31December. Herald Resources is valued at $A310 million. There is speculation thatPerilya could ask Herald Resources for access to due diligence and couldpotentially appoint a board member to the group. Shares in Herald Resourcesclosed $A0.08 higher on 9 November, at a record $A1.58, while Perilya fell$A0.03 to $A3.60







> 15 November 2007
> Excellent new drill intercepts at Mount Oxide copper project
> 
> Perilya Limited (ASXEM) are pleased to announce further significant results from recent drilling at the Mount Oxide copper project in Queensland, Australia. Highlights include:
> ...



).


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## mishu (19 November 2007)

I am not sure why you are stuck on mine life. Obviously new resources and interests in various other companies add to the company life and mine life. 
Take a look at the diversity and intelligence of the management of the resources they have and the way they are expanding.

They have at least 6 years mine life in the Broken Hill mine. They have an ongoing interest in Silver Lakes. They have another operating mine and they have now found a good site for open cut copper mining. They have other good drilling results in other locations. And they have the stake in Herald.


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## mishu (20 November 2007)

Nice for companies that mine zinc and lead that lead is apparently going into deficit according to a recent article. Particularly with zinc prices falling as they have.


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## Tye (20 November 2007)

just wondering how you guys are coping with perilya. I dont know anything about T.A or Fundamentals. But to an untrained person like myself it looks as perilya has had it for good. The market is so strong but perilya is so weak. (what a crap share, considering my broker told me to buy it at over $5, bloody dick head)


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## legs (20 November 2007)

Tye said:


> just wondering how you guys are coping with perilya. I dont know anything about T.A or Fundamentals. But to an untrained person like myself it looks as perilya has had it for good. The market is so strong but perilya is so weak. (what a crap share, considering my broker told me to buy it at over $5, bloody dick head)



The market is anything but strong, with ALL resource commodities down to 3 mth lows. This stock has been hit hard but look at similar cap stocks such as Oxiana that copped a 6% fall today, not as  bad as PEM. MRE 3.8% down, ZFX 3.73% down, etc etc. It will rebound in my opinion and when it does I will be all smiles as I seem to buy more each day it gets lower. 
I must say $5 is my target however, so maybe he was a bit over enthusiastic about it.


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## countryboy (20 November 2007)

you have a wins and losses Tye. PEM above $5 maybe a bit hard to swallow.The guys are still pulling plenty of tonnage out of the mine and management is looking for a merger ,aquisition or take over. The lousy 1c dividend recently didn't help the share price but gave PEM a small warchest to go after something. i know your not allowed to post targets on this site but for me its current price says buy- undervalued ( PE etc) I aim to exit above $4 which PEM has bounced off several times this year.


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## mishu (22 November 2007)

Interesting to see what happens today with this stock. It is at the bottom of the Williams, at which point 85% of stocks bounce up. However zinc fell again last night.


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## countryboy (22 November 2007)

Ouch ! broke the $3 mark. For me this is over sold and represents great value. Still mining lead which has made up for any shortfall in the price of Zinc.  No lead from the DOW so the market will go sideways unless metal prices go south again tomorrow.To buy or not to buy...that is the question


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## Ken (23 November 2007)

PEM could fall to $1.50 and still be lining up with a 5-7 year upward trend.

There is massive gapping from $3.40 south.....

Thus why I think its very volatile.

It's hard to pick a bottom for stocks like these, because they move so quickly when they do.

Confirmed downtrend for last 12 months you'd say.  Well off all time highs.

EPS still looking good going forward. Counts for nothing when people are selling up though...


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## legs (23 November 2007)

Lead 2845.0000 -65.0000 -2.2337 USD/t Mkt Close, Nov 22 

Zinc 2226.0000 +5.5000 +0.2477 USD/t Mkt Close, Nov 22 

Probably take another pounding on the -2.2% Lead fall. OUCH!!


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## legs (23 November 2007)

Consensus Earnings 


                                        FY08  FY09   
 Consensus EPS1            (c) 63.5   66.6  
 Forecast Earnings        ($M) 121.1 127.0  
 EPS Growth                 (%)          4.9  
 P/E Ratio                     (x)   4.7    4.5  
 P/E Rel. All Ords            (x) 0.31   0.34  
 P/E Rel. Sector             (x) 0.39   0.44

Strong buy for me!


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## tronic72 (23 November 2007)

legs said:


> Consensus Earnings
> 
> 
> FY08  FY09
> ...




I agree and actually jumped in today 2.9. Healthy company that's been oversold over the last few months.


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## Ken (26 November 2007)

Heres some charts of ZINC and PEM.

Its pretty interesting I think.  Says a lot about the way PEM is traded.


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## mishu (27 November 2007)

Very true. PEM has been very tightly linked to zinc in its trade.          

In that light, zinc price was up again overnight. More than 4 percent. That is several rises in a row now- infact it has turned around and climbed ever since China did its allowance in its market of allowing a thirteen percent drop to muster support for it, which worked. 

Also PEM, looks like being able to diversify into copper, somethign ZFX would liek to do.  Have you heard the interview about Mount Oxide that was out yesterday? Looks like the area is good not just for copper but also cobalt and may be good for more extensive mining as well as open cut.

If I had the money I would probably be buying in around now. Within a week anyway. But the share represents great value for money right now in my view.


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## Ken (27 November 2007)

http://www.mineweb.net/mineweb/view/mineweb/en/page36?oid=40698&sn=Detail


More positive news for PEM

But guess what share price still falling...


What does this mean, other than very frustrating times. or does it mean get some margin loan happening....

Speaking out loud.

Still trading on a silly forward looking PE ratio.


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## tronic72 (27 November 2007)

Ken;229060[url said:
			
		

> http://www.mineweb.net/mineweb/view/mineweb/en/page36?oid=40698&sn=Detail[/url]
> 
> 
> More positive news for PEM
> ...




I purchased PEM late last week and sold today. I made a small profit (paid my brokerage). To be honest I forgot why I sold!!! .....oh I remember, was to buy more Allco Finance after the citigroup cash injection which was designed to calm those exposed to the sub-prime fallout. (correct me if I'm wrong)

I've just had another look and PEM still seems like a good thing. (guess that's why I purchased last week huh) Etrade research shows, 4 strong buys, 3 moderate buys and one hold.

I've only been trading for 18 months but I learnt early on, that most of the people in the Market are sheep. I don't mean that in a rude way, but often it takes someone to make the first move. If the price stays the same or lower this week I'll probably buy back in. I don't think we'll have to wait long for PEM to turn around. I think a positive increase in a commodities price could be all it takes.

My 2c


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## mishu (28 November 2007)

Ken said:


> http://www.mineweb.net/mineweb/view/mineweb/en/page36?oid=40698&sn=Detail
> 
> 
> More positive news for PEM
> ...




Yes very good to see that news- also reported here. Very glad they are on track with that sale as expected in their outlook for this quarter. 

http://www.news.com.au/adelaidenow/s...55-913,00.html

"THE first shipment of zinc silicate ore from Perilya's Beltana mine has been loaded at Port Pirie, bound for China.

Perilya said yesterday one of the largest users of zinc silicate in the world had pre-paid for the 10,000 tonne shipment, with a second shipment planned for January....

Currently, 160,332 tonnes of high grade zinc ore at an average grade of 39.2 per cent zinc and 80,112 tonnes of low grade zinc ore at an average grade of 16.1 per cent has been mined and stockpiled on site, ready for shipment to Port Pirie.

Sales of the ore were expected to continue for another two to three years."


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## mishu (28 November 2007)

Zinc LME stockpiles have fallen again. While the price of zinc had a minor setback last night it did rise 5 percent the previous day. Vast over reaction in the market today.


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## mishu (29 November 2007)

And zinc prices back up again today. That would be i think 5 out of the last 6 days.If this stock does not start rising soon I want to know why.


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## legs (29 November 2007)

mishu said:


> And zinc prices back up again today. That would be i think 5 out of the last 6 days.If this stock does not start rising soon I want to know why.




Zinc 2479.0000 +104.0000 +4.3789 USD/t Mkt Close, Nov 28 

Yes it appears it has finally reversed its trend. However Lead wasn't very impressive:-

Lead 3022.5000 +20.5000 +0.6829 USD/t Mkt Close, Nov 28 

We need a better turnaround in  lead as well to see it back up near $4.


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## legs (29 November 2007)

Do you think the market has finally caught up to this? Is a +7% daily upturn really just from this or is there more to this turnaround? Any whispers?


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## countryboy (2 December 2007)

PEM - PERILYA LIMITED 
Credit Suisse rates PEM as Outperform - A positive for the company is it has begun to ship ore from the Beltana Project, but as the broker notes zinc prices are currently below its forecasts and this implies downside earnings risk. 
Despite this the stock remains cheap in the broker's view as even on spot earnings it estimates the shares are trading on a FY09 P/E of around 5x. 

Target price is $5.00 Current Price is $2.92 Difference:$2.08 - (brackets indicate current price is over target). If PEM meets the Credit Suisse target it will return approximately 71% (excluding dividends, fees and charges - negative figures indicate an expected loss). 

The company's fiscal year ends in June. Credit Suisse forecasts a full year FY08 dividend of 14.80 cents and EPS of 60.20 cents . At the last closing share price the estimated dividend yield is 5.07%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 4.85.


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## countryboy (2 December 2007)

Zinc prices zoom by 15%

MUMBAI: Zinc prices have moved up by over 15% in the week on London Metal Exchange making it the top gainer of all commodities during the week ended December 1. 

On LME the 90-day contract closed at $2,590 per tonne from about $2,252 last week. On MCX, zinc December contract closed at Rs 102.95 from Rs 92.35 last Friday. The domestic spot prices also rose due to increased demand by stockists. 

http://economictimes.indiatimes.com/Markets/Zinc_prices_zoom_by_15/articleshow/2588655.cms


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## mishu (17 December 2007)

Good to see Credit Suisse rating this stock as one of its 4 hot picks in a recent news article. Also it can only be good for PEM that its holding in Herald is worth more because of the takeover bid for Herald by Bumi. Also recently rated by Huntley's as currently worth 3.55.

We are holding. I can't understand why people are selling unless it is a quick profit take.


----------



## UMike (17 December 2007)

mishu said:


> Good to see Credit Suisse rating this stock as one of its 4 hot picks in a recent news article. Also it can only be good for PEM that its holding in Herald is worth more because of the takeover bid for Herald by Bumi. Also recently rated by Huntley's as currently worth 3.55.
> 
> We are holding. I can't understand why people are selling unless it is a quick profit take.



Well it got hit hard today. 

Wish I sold half my holdings for $3.55 recently.

I too still am very positive about this stock.


----------



## michael_selway (17 December 2007)

UMike said:


> Well it got hit hard today.
> 
> Wish I sold half my holdings for $3.55 recently.
> 
> I too still am very positive about this stock.




Do you think a short mine life is an issue with PEM?

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 7.8 22.5 35.8 54.5 
DPS 6.0 4.8 15.9 12.7 *

Thx

MS



> Date: 12/12/2007
> Author:
> Source: The Australian Financial Review --- Page: 17
> The prices of key industrial metals have fallen sharply in recent months,reflecting international concern about the state of the US economy. The nickelprice fell by about four per cent in London trading on 11 December 2007, and ithas fallen by 49 per cent since peaking at $US51,800 in May. Likewise, the priceof zinc has fallen by over 45 per cent since late 2006 and the copper price isdown 18 per cent since May 2007. Meanwhile, the shares of Australian zinc andnickel producers such as Perilya, Zinifex and Jubilee Mines have fallen sharplyin the last month


----------



## mishu (19 December 2007)

"Perilya weighs into Herald bid
13 Dec 2007 | The Australian Financial Review | Michael Vaughan 

Base metals miner Perilya will hold talks with Herald Resources following a $455 million bid for the explorer from Indonesia's largest mining company, PT Bumi Resources. "

http://afr.com/home/viewer.aspx?ATL://20071213000020076505&title=Perilya+weighs+into+Herald+bid

"...Between January 8 and 14, the Dow Jones AIG commodity index will adjust the weighting of many commodities including zinc, nickel, copper and aluminium traded on the London Metal Exchange (LME).
The adjustment is likely to involve the purchase of about 250,000 tonnes of zinc and 10,000 tonnes of nickel. Both metals are used to make steel.
To put those numbers into perspective, stocks in LME warehouses now stand at around 77,000 tonnes for zinc and at 46,000 tonnes for nickel.
"If you look at buying relative to market size, the rebalancing is probably going to have its most significant impact on zinc," said Michael Jansen, analyst at JPMorgan.
"It will also be very friendly to nickel...""

http://www.guardian.co.uk/feedarticle?id=7149765


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## UMike (20 December 2007)

michael_selway said:


> Do you think a short mine life is an issue with PEM?



 I'll concede that I don't know a great deal about PEM (well not as much as I do CBH) but I am not overly concern about some estimation of the mine life.

Broken Hill Southern Operation  conservatively credit five years mine life based on reserves.

As well as.....



> Perilya (PEM) announced a Board decision to proceed with a six month feasibility study on the development of the 3.7Mt North Mine Deeps project at Broken Hill. Perilya's CEO, Len Jubber, said that the potential extension of the existing North Mine would add substantial value to the Broken Hill mine, extending the mine life and reducing dependence on the Southern Operations.


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## mishu (21 December 2007)

Regarding mine life they are also a go for copper since that discovery. And they have just sold their stake in Herald for a nice 16 million dollar profit, as I calculate it. Should be good for their bottom line this quarter. 

http://stocknessmonster.com/news-item?S=PEM&E=ASX&N=390740




> Perilya Limited (ASX: PEM) has today sold its 8.86% shareholding in Herald Resources Limited for a total consideration of approximately $39.3 million and ceases to be a substantial shareholder.
> ...Background to Perilya
> Perilya Limited is an ASX 200 Australian base metals mining and exploration company. Perilya is investing substantially in the development of its three major projects located in the Broken Hill, Mt Isa and Flinders regions as well as exploration in the surrounding tenements.
> The company is expanding its operations at the iconic Broken Hill mine through the development of an exploration decline at
> ...


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## Freeballinginawetsuit (21 December 2007)

mishu said:


> Regarding mine life they are also a go for copper since that discovery. And they have just sold their stake in Herald for a nice 16 million dollar profit, as I calculate it. Should be good for their bottom line this quarter.
> 
> http://stocknessmonster.com/news-item?S=PEM&E=ASX&N=390740





Yep the HER saga is a bit of a dissapointment for all concerned, PEM have done the right thing to exit there holdings for a tidy profit ( HER is a bit of a done deal in my opinion, all concerned may as well accept and move on).

Market isn't liking it ATM though.................perhaps most aren't happy at the 100% plus profit and wanted PEM to hold out for env approvals till the neva neva!.

IMO PEM are oversold and undervalued and have loaded up today


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## treefrog (21 December 2007)

technically (day chart) there is strong S/R line at $2.50 but then its down to S/R at $2.00
froggy's  worth is thatthe $2.50 level should hold and bounce for a while but a lot of overseas buying a coupla years back and suspect they would be bailing with falling zinc (halved since oct 06) and looks like completing a classic head and shoulders pattern taking it back to $1200 - if PEM goes with it share price will drop to $1.60 before mid next year


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## Freeballinginawetsuit (21 December 2007)

treefrog said:


> froggy's  worth is falling zinc (halved since oct 06) and looks like completing a classic head and shoulders pattern taking it back to $1200 - *if PEM goes with it share price will drop to $1.60 before mid next year*




Pretty much got the opposite cycle view on Zn price than you!.

PEM would be in some serious probs if the SP reached $1.60, considering there cash reserves and stockpiles.......... something like a cave in might do it though .


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## treefrog (22 December 2007)

hope u r right freeball - just calling what IS there atm and possibilities

the thread was concern/reason for PEM's current slide

have a good xmas


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## tronic72 (27 December 2007)

Am looking at buying back into PEM. The recent high volume combined with a turn around in the Zinc price should make all the difference. 

Here's part of what Huntley's said in their recent buy recommendation:

"We initiate PEM coverage with a Buy recommendation. Key attraction is likely production growth at Broken Hill and other advanced projects. Our valuation is $3.55ps. Long term assumptions are US70c/lb lead, US90c/lb zinc and US$10/oz silver. We use an A$/US$ foreign exchange of 0.80 and a 10% discount rate. PEM’s share price has languished since the tragic death of an employee in January."

Anyone else got PEM on their watch list?


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## DowJones (28 December 2007)

I have PEM on my watchlist. I have bought the stock twice. The recent one was about 2 months ago when I bought it at 3.90 and sold at 4.30. I thought it was going on a strong run...

The price of zinc needs to rebound, but on the other hand, what mining stock is trading at PE of 5.52???

Its EPS, however is decreasing due to their mine life - but they are cashed up and will acquire. 

IMO, at $2.6 can it get cheaper? Wait for a more favourable RSI I think.


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## tronic72 (28 December 2007)

The current RSI is only 30.1. I was under the impression that anything around the 30 mark meant the stock was over sold. 

Correct me if I'm wrong.


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## bvbfan (28 December 2007)

RSI can stay below 30 for a long period, doesn't make it a great buy now.

If you had used RSI, then on the run up the RSI went above 70 at about 2.90 but it stayed overbought to $5


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## treefrog (29 December 2007)

tronic72 said:


> Am looking at buying back into PEM. The recent high volume combined with a turn around in the Zinc price should make all the difference.
> 
> Here's part of what Huntley's said in their recent buy recommendation:
> 
> ...





tronic - that Huntly report does not instill confidence as PEM forward sold all their silver for the next several years at less than $5/oz a couple of years ago - a significant blunder as the spot price of silver quickly rose to three times that shortly after the sale and is thereabouts today

the other thing that is not good news for PEM share price is that analysts are continuing to downgrade earnings forecasts

and living on top of their main cashcow here in broken hill one hears a lot of rumours about the local mine - one is that the amount of ore remaining in the north mine is much less than old records indicate and that comes from the former underground foreman for that mine who says they actually mined the pillars much narrower than agreed with the DoM - so who knows - refer to ASX ann "Decision to Proceed with North Mine Deeps Feasibility Study" dec 20


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## oldblue (30 December 2007)

Hi treefrog
Given the prospects for silver it would be interesting to know who PEM sold its 5 years' production  to.

Any ideas? Did they ever disclose this?


----------



## treefrog (30 December 2007)

oldblue said:


> Hi treefrog
> Given the prospects for silver it would be interesting to know who PEM sold its 5 years' production  to.
> 
> Any ideas? Did they ever disclose this?




yes they did - this is part of their 9/9/05 asx ann......"PEM has sold 17.2million oz of payable silver to Coeur for an upfront payment US $36m - a further $6m will be paid in annual increments over the next 8 years plus $2 /oz as each oz is produced plus a refining charge of 31c/oz...."


This (in part) is was what I penned for the local rag around that time (14th jan 06)......... (the hillbilly trader = treefrog)


"But then the market has begun to wake up that 65% of Perilya’s product is zinc and that the zinc price growth that started in late 2004 was not a short term spike with the price having doubled from $1000/tonne to near $2000 today.
And hasn’t the Perilya price responded – up to the time of writing (Saturday) it has lifted 33% in just 10days.
A really rough check on this would be to say that the market valued Perilya shares somewhere around $1 over the last few years when it was drifting in and out of profit each year so all things being equal, the product selling prices have now doubled so we should be good for a significant free cash and earnings boost from here on – dare we hope for double on those and the share price as well?
Checking the longer term chart Perilya has twice before tried to break through the $1.45 level and failed (jan 94, jan 04) and looks set to have another attempt at this level. When trading, Hillbilly has observed that quite a few shares move above a price level on their third attempt. Conservative traders will wait for a clear break above that resistance, but for others the recent doubling in zinc price will be more than enough to jump on board with the expectation that dividends now should not now be too far away.
With our additional homework done, many would probably agree with the analyst who made the strong buy recommendation.
And does Hillbilly have any concerns about the hometown miner? One certainly. Just how market savvy are the Perilya board members when they sell all the family silver in September last year at the bargain basement price (to the purchaser mind) of little more than $5/oz when the market price was then $7.50 and rising solidly on the shirt-tails of the gold trend.
Silver is now $9/oz and rising rapidly with some year end forecasters suggesting $15/oz.
Let’s put this another way – Perilya produces silver, almost 2million oz a year at negligible cost because it is a by-product of the main lead and zinc operation. It sells this silver at half market price to buy a gold mine at full price. The forecast price increase for silver is to at least double but the price of gold to increase by only 40%.
All going well, the gold mine will produce 65,000oz pa, marketable at say $600/oz for a net say $200/oz giving $13m profit pa less the costs to buy the mine. Whereas the 2m oz of silver marketable at say $11/oz giving a net profit of $20m pa. Or $7m pa better off staying with the well proven silver production.
The CEO’s spin to shareholders is that it is a good deal, so I contacted the company a few times last week to understand how so as hillbillies are generally regarded as fairly thick, but I couldn’t get anyone to tell me.
And without a glossy market education on these matters, Hillbilly’s view is that the potentially foregone $50m on 17.2m oz silver would have been very welcome as dividends to the long suffering shareholders.
And let me state with certainty that board members won’t let this solid gold clanger affect their options, salaries and bonus entitlements. They will simply ask us to look how much better the share price is now than in June last year or some other diversion.
But that’s the market

Until next time
The hillbilly trader


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## oldblue (30 December 2007)

Thanks for that, treefrog.

I've been tracking PEM for a few months now but didn't research back far enough to find the goods! Very interesting, hillbilly was right on the money!

Seems to make CXC an even brighter prospect?


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## treefrog (4 January 2008)

keeps attacking the 2.50 S/R line looking for a hole

frog has changed his solid 2.50 S/R line to one with gaps in to signify the price is looking to go lower  - as the gaps and holes are equal length now, it has a 50/50 chance to move lower next time it bumps up and down again.


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## mishu (16 January 2008)

"- PERILYA LIMITED

UBS rates as Upgrade to Buy from Neutral - The broker has lowered its target price to $3.05 from $3.35 after downgrading FY08 net profit by 48% and FY09 by 18%. This comes after factoring in the company?s weaker production guidance and lower short-term zinc prices into its valuation. UBS has, however, upgraded the rating to Buy from Neutral as it believes that much of the risk with Broken Hill?s operating performance has been priced into the share price. ... "

This is a recent upgrade to buy from UBS. 

Source FN Arena Broker Call Headlines - 11 Jan 2008
Sunday Jan 13 10:30 AEDT


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## DowJones (16 January 2008)

I remember buying this stock at 3.92 and selling it at 4.25 not too long ago, how times have changed, for the worse...

The PE is remarkable but baked into that is the decreasing EPS due to the mine life. PEM Ive read is cashed up for acquisitions though.. Also, a rally in Zinc prices will help it greatly.

Another with low PE for smilarly reasons is ZFX...

Both look attractive and could bounce, or await a takeover at these low levels


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## tronic72 (16 January 2008)

DowJones said:


> I remember buying this stock at 3.92 and selling it at 4.25 not too long ago, how times have changed, for the worse...
> 
> The PE is remarkable but baked into that is the decreasing EPS due to the mine life. PEM Ive read is cashed up for acquisitions though.. Also, a rally in Zinc prices will help it greatly.
> 
> ...




I agree 100% 

Yet another decent stock who's price is totally oversold. at $2 this share is good value but the way the market is I won't go near it. It's not like the company isn't worth anything. 

Nearly 200 Million in cash and assets, good income, at a bargain basement price. It's not like the company is failing or even in bad shape. 

Maybe PEM and ZFX should merge to become a Zuper Cr@p Miner


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## DowJones (17 January 2008)

Both PEM and ZFX fell further today. 

I was watching CNBC and some analysts noted that there is starting to be a lower demand on commodities and there is a stockpile on the LME. With zinc prices getting smashed recently, hopefully it wont drop too much further.

PEM seems like a good buy, but I rather fly to quality and hold big caps right now.


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## treefrog (22 January 2008)

sub $1:50 as we go to press
that's about 7% divvy over the next few years IF earnings hold as forecast

still short looking for $1:00 now, or confirmation to reverse back to longs


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## legs (22 January 2008)

treefrog said:


> sub $1:50 as we go to press
> that's about 7% divvy over the next few years IF earnings hold as forecast
> 
> still short looking for $1:00 now, or confirmation to reverse back to longs




I have heard that they have enough cash that equals $0.75 a share...this must make this the bargain of the year??


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## treefrog (22 January 2008)

legs said:


> I have heard that they have enough cash that equals $0.75 a share...this must make this the bargain of the year??




don't care how good it looks on the info they have told us legs, the market says <$1:50

but yes, cash assets of $147m, for 194m shares

quick ratio a very healthy 0.95 (for a miner) (BHP .65)


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## Freeballinginawetsuit (22 January 2008)

treefrog said:


> don't care how good it looks on the info they have told us legs, the market says <$1:50
> 
> but yes, cash assets of $147m, for 194m shares
> 
> quick ratio a very healthy 0.95 (for a miner) (BHP .65)




You called this one right TF a few weeks back, I'm currently 20 percent in the red even after hurdling in!.

Watching closely for another double digit downer on open tomoz.

I wouldn't expose youre **** too much on this one though...... situations like this are exactly what caused the wealth gap in the first place.

Hope alls well in Broken Hill


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## xoa (23 January 2008)

PEM rose 25 cents early (glad I sold out) then lost all its gains.

Zinc prices have been falling and I guess people are anxious about the upcoming quarterly.


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## treefrog (23 January 2008)

Freeballinginawetsuit said:


> You called this one right TF a few weeks back, I'm currently 20 percent in the red even after hurdling in!.
> 
> Watching closely for another double digit downer on open tomoz.
> 
> ...




hi freeballs,
had another look at this one and have now removed my shorts as it settled back there at the 150 level again (sitting here in just my jocks now)
the 150 level is the third and longest fib extension and I think will be hard to push down from here without first an exhaustion retrace but hell, market is nervy and anything goes
didn't do well today at all today considering others but vol not high and buters/sellers are even for now
will sit this one out until things are more indicative


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## Ken (23 January 2008)

I cant honestly see a recovery for PEM.

Just my opinion but I have never seen a chart fall from 5 buxs to 1.50 and then recover in any short period of time. This could seriously take 3-5 years to recover.

In which time they would have needed to make a discovery of some sort...


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## Ken (24 January 2008)

PEM

10 year return on investment.

Strangley enough the 10 year return chart is still in an uptrend.

I guess you could say if you take out the volatilty.

Year on year PEM has been a solid investment.


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## legs (25 January 2008)

Nicely up today on what? People have obviously seen value and I agree.. With cash reserves on 75c per share and when you count the reserves they have..even though diminishing.. it has to represent value.. is there something i've missed? rumour or anything?


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## Ken (25 January 2008)

Nope I think the market has just had enough of seeing it get sold down.

It went from 3.00 to 1.40 in no time.

So unless you bought in the last 2 days PEM has been a shocker.

Is it a bottom, not sure.

I know there is a resource upgrade coming up.


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## Freeballinginawetsuit (4 February 2008)

treefrog said:


> hi freeballs,
> had another look at this one and have now removed my shorts as it settled back there at the 150 level again (sitting here in just my jocks now)
> the 150 level is the third and longest fib extension and I think will be hard to push down from here without first an exhaustion retrace but hell, market is nervy and anything goes
> didn't do well today at all today considering others but vol not high and buters/sellers are even for now
> will sit this one out until things are more indicative




Exited half my recent trades today in PEM, same with ZFX, happy with the returns.

More upside to come IMO, especially with PEM. so holding the rest for now


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## tronic72 (7 February 2008)

Freeballinginawetsuit said:


> Exited half my recent trades today in PEM, same with ZFX, happy with the returns.
> 
> More upside to come IMO, especially with PEM. so holding the rest for now




Got some PEM today at 1.6. Better return than cash sitting in the bank and that assumes the company goes nowhere in the next 12 months. Huntley's still have a target price of, wait for it.......3.55 PS. We all know that's crazy for today's market but I still feel it's undervalued. The clincher for me was that I noticed PEM had one of the highest dividend yields. See my post on finding companies with high Dividend rates.

Finally have noticed a bit of resistance recently so it should't be long before more buyers jump in.


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## Freeballinginawetsuit (7 February 2008)

tronic72 said:


> Got some PEM today at 1.6. Better return than cash sitting in the bank and that assumes the company goes nowhere in the next 12 months. Huntley's still have a target price of, wait for it.......3.55 PS. We all know that's crazy for today's market but I still feel it's undervalued. The clincher for me was that I noticed PEM had one of the highest dividend yields. See my post on finding companies with high Dividend rates.
> 
> Finally have noticed a bit of resistance recently so it should't be long before more buyers jump in.





PEM's div yields are O.K. but I think more importantly Management needs to pull there head in and form a constructive production profile/targets for the Company over 08. 

Finances arent an issue so this is not an unreasonable ask IMO.What PEM does with HER's profit and cash reserves short term is essential in the aforementioned, the market will savage them if they squander this cash position or pay some silly divy just to keep pundits happy!.

ATM I'm back to a sensible holding in PEM (over exposed myself of late). Like you Tronic, I see value in PEM and if they retest the lows again.......... I will hurdle in 

Cheers


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## tronic72 (7 February 2008)

Freeballinginawetsuit said:


> PEM's div yields are O.K. but I think more importantly Management needs to pull there head in and form a constructive production profile/targets for the Company over 08.
> 
> Finances arent an issue so this is not an unreasonable ask IMO.What PEM does with HER's profit and cash reserves short term is essential in the aforementioned, the market will savage them if they squander this cash position or pay some silly divy just to keep pundits happy!.
> 
> ...




Hey Freeballin,

The directors at PEM's agree with you 100% Have a look at their latest article entitled "Reviewing Strategic Options". See below:

*5 February 2008 


Reviewing Strategic Options 

The Board of Perilya Limited has commenced a process of reviewing strategic options for maximizing 
shareholder value.  This will include a review of corporate and operational activities and should be 
completed during the March quarter 2008. 

The objective will be to refine the company's growth strategy to optimise the operational performance of 
its existing assets and pursue merger and acquisition opportunities that may result in corporate 
transactions. 

The company confirms that Patrick O'Connor has been appointed Executive Chairman until completion 
of the implementation phase of the strategic review and any corporate transactions. 

Further announcements will be made by the company in accordance with its continuous disclosure 
reporting obligations and when circumstances dictate. *

I think everyone in the Market, including the directors it seems, have been waiting for PEM to have a more definitive view of where they are heading.

This review should be just the ticket and I wouldn't be surprised if the SP turns around simply on the news of this review. Maybe the turn around on Thursday was based solely on the news of the review as I've seen no other reason for the turn around


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## jonojpsg (19 February 2008)

Updated Mt Oxide resource out!!  80% increase to 200 thousand tonnes of contained copper.  Sounds good, and market seems to think so too, up 18% as I write.  PLeased that something is going right for me after the AED debacle


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## Ken (19 February 2008)

Up 18%....

Down 66% from its all time highs.

The frustration of going long on PEM.

Still needs to rise another 30% for me to break even.


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## countryboy (19 February 2008)

work is rife with rumours of something with CBH,Met a bloke from WA over to start employment down the north but has been told to sit for a while until things are clarified. I thought todays leap forward was about CBH.....


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## Freeballinginawetsuit (19 February 2008)

countryboy said:


> work is rife with rumours of something with CBH,Met a bloke from WA over to start employment down the north but has been told to sit for a while until things are clarified. I thought todays leap forward was about CBH.....




Going on PEM's low open today, any truth in yada/yada rumours would seem unlikly.

 PEM seemed to bump along with a bit of momentum after the resource in-situ upgrade !.


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## UMike (21 February 2008)

Rumours are somewhat founded.

ann: http://cms.cbhresources.com.au//information/pdf/21.02.08.pdf

Chb has been going great guns since while PEM has dropped a bit.


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## countryboy (21 February 2008)

i cant see a takeover or merger, This ann will be operational. Joint crib halfway down the incline ! and share a loader or two. should have happened earlier.


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## Miner (21 February 2008)

*EXTRACT FROM FN ARENA*

*Market Sentiment: 0.6 *



PEM - PERILYA LIMITED 
Credit Suisse rates PEM as Downgrade to Underperform from Neutral - The *analysts have downgraded Perilya's rating due to recent relative share price movements.* In the past five days, Perilya's share price has risen 17.4% while the S&P/ASX200 has fallen 1.2%. 
Perilya has released encouraging results from its Mount Oxide deposit. Although this is positive, analysts believe that earnings will drive the share price, and Credit Suisse maintains the outlook for Perilya's earnings is weak at present. 
Target price is $1.70 Current Price is $1.90 Difference$0.20) - (brackets indicate current price is over target). If PEM meets the Credit Suisse target it will return approximately - 10% (excluding dividends, fees and charges - negative figures indicate an expected loss). 

The company's fiscal year ends in June. Credit Suisse forecasts a full year FY08 dividend of 3.90 cents and EPS of 15.80 cents . At the last closing share price the estimated dividend yield is 2.06%. At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 11.99. 


ps: i do not hold any PEM SHARE OR OPTIONS . Just for information


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## UMike (22 February 2008)

countryboy said:


> i cant see a takeover or merger, This ann will be operational. Joint crib halfway down the incline ! and share a loader or two. should have happened earlier.



I agree also countryboy. Makes sense to combine the efforts in this way at Broken Hill.

Better late than never.


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## noirua (3 March 2008)

Boardroom Radio report on the half year results with Mr Len Jubber, MD and CEO:
http://www.brr.com.au/event/42084

Company website: http://www.perilya.com.au


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## UMike (3 March 2008)

noirua said:


> Boardroom Radio report on the half year results with Mr Len Jubber, MD and CEO:
> http://www.brr.com.au/event/42084
> 
> Company website: http://www.perilya.com.au



I know these guys are experts in spin but It seems to me that the company is going way better than the sp of late indicates.


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## cordelia (4 March 2008)

What happened to PEM today? I still have a few of these not too many. I thought the price of zinc was stronger


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## Freeballinginawetsuit (5 March 2008)

Fug, owning this share is like partaking in chinese torture. 

Im sure if they gave the inmates at Guantanimo the choice of being a shareholder or giving up Bin Ladens whereabouts they would opt for the latter .

Got a partial fill for more PEM today.......will the bottom never end


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## UMike (6 March 2008)

ha ha....I totally agree with you.

I have no idea what is driving the price down Zinc, Copper and Silver have increase greatly in Price,. 

Bin Larden's in a mountain in Afgan I tells ya.


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## Young Gun (6 March 2008)

Looks like a double bottom in charting analysis, anyone support my views on this one? New to this stock and havent been following it, interesting thou.


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## legs (6 March 2008)

Young Gun said:


> Looks like a double bottom in charting analysis, anyone support my views on this one? New to this stock and havent been following it, interesting thou.




Dont know about that, looks like it tested it a a while ago and went below. But then again I dont chart too much either.


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## blablabla (6 March 2008)

Young Gun said:


> Looks like a double bottom in charting analysis, anyone support my views on this one? New to this stock and havent been following it, interesting thou.




Looks more like a triple bottom. The timeframe of less than 2 months might be a little short for this triple bottom to be a strong reversal pattern but it is nevertheless either neutral or a reversal. A reversal will not be confirmed until the $2.00 resistance is smashed. 

On fundamentals PEM might struggle to get above $2.00, but a rise to this level is possible.


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## treefrog (11 March 2008)

somehow methinks the attached earnings and divvies have a lot to do with it and will see price less than a $ in near future


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## Freeballinginawetsuit (12 March 2008)

treefrog said:


> somehow methinks the attached earnings and divvies have a lot to do with it and will see price less than a $ in near future




TF,

Comsec data isn't worth a pinch of salt, youre own cut/paste indicates how wrong they have been over past forecasts . Who uses broker research off Comsec anyway.......!

Current market sentiment in general may indeed take PEM below a buck, are you a buyer/seller/bystander or downramper if that eventuates?


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## treefrog (13 March 2008)

Freeballinginawetsuit said:


> TF,
> 
> Comsec data isn't worth a pinch of salt, youre own cut/paste indicates how wrong they have been over past forecasts . Who uses broker research off Comsec anyway.......!
> 
> Current market sentiment in general may indeed take PEM below a buck, are you a buyer/seller/bystander or downramper if that eventuates?




freeballs

there was no comsec analyst in that composit - commsec just collate the data - those included for the PEM summary (according to commsec) were CONTRIBUTING ANALYSTS  
CREDIT SUISSE - AUSTRALIA, HARTLEYS LIMITED, PATERSONS SECURITIES LIMITED, GOLDMAN SACHS JB WERE, ABN AMRO, E.L. & C. BAILLIEU STOCKBROKING LTD., MACQUARIE RESEARCH EQUITIES, UBS (sorry for the caps - copied from their footnote

I am monitoring PEM only atm - have not traded it since closing short position at 1.50
have been looking to go long but am wary of current market sentiment and apparent lack of confidence in the spin and decisions made by CEO Jubber
not convinced there is much downside left as more analysts are jumping on the buy button for PEM - but despite this the market is not interested as so many buy reccos and so few buyers
and yes I do take note of analyst reccos (for MT trades) not because I think they are right or wrong but because, like the media they are a factor in influencing buyer sentiment - their weighting I input to my decissions could be up to 1/3
cheers


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## Nick Radge (13 March 2008)

Its a few weeks old now, but....







*BOTTOM LINE 
26/2:*
EW Trend: Down
Price Trend: Down
Trend Strength: Strong
Broker Consensus: Intermediate BUY

*LAYMANS ANALYSIS 
26/2:*
VIDEO ANALYSIS (1 mins 37 secs)
*LAYMANS:* Always the cynic that I am but here is a classic example of how and why Fundamental analysis is a dangerous sport. My philosophy is not about being right or wrong. The damage is done by staying wrong. I'm going to quote FN Arena (www.fnarena.com) which is a service that helps in my analysis of Broker consensus and cuts through the long-winded reports. Here are the valuations by Credit Suisse, a very large, global investment bank that pays its analysts top dollar:

22 October - Valuation: $5.00 Price: $3.79
28 November - Valuation: $5.00  Price $2.78
8 January - Valuation: $3.00 Price $2.20
31 January - Valuation $1.70 Price $1.88

The whole journey this Broker has suggested that PEM is a Buy. All the way down. In turn they have reduced their valuation progressively and after the price has declined. At no stage did they suggest exiting positions or protecting capital. The core difference between Technical Analysis and Fundamental Analysis is that charts offer a very strong right/wrong point where capital can be protected. Afterall, if you lose your capital, you can't participate. One of my core motto's: "I am simply a manager of bad trades". If I can look after the garbage, then the rest will look after itself.
*TECHNICAL:* Off my high horse. The price action after the drop through the major support at $3.50 has been nothing short of impulsive. Clean and strong. The current price action is taking the shape of a 3-wave counter trend pattern and is most likely a wave-iv. Classic texts will call this a bearish flag. Any breach through the lower side of this flag suggest *continued weakness, quite possibly toward $0.50* being the lower side of the channel. Discussing such targets can be difficult, especially when looking at a chart and seeing where the stock was just a short time ago. However, reality suggests and confirmed by recent events, that stock prices can go far and wide of the mark driven by sentiment of fear and greed. PEM has had a slow tumble compared to the likes of Centro, Allco and today in ABC Learning. A slow tumble is not an over reaction though and represents a more sinister problem with the company. Until we see a base being built there is no reason to be involved with this stock on the long side.  

*TRADING STRATEGY
 26/2:*
A break of the lower flag boundary would suggest a selling opportunity but many would find this hard considering how far the stock has come. Essentially it can go to zero. There are plenty of stocks trading below $0.50 that were once high fliers. The same thing occurred back in the late-90's. All we need do is replace Resource with Technology and we're doing the same dance. 


_This post may contain advice that has been prepared by Reef Capital Coaching ABN 24 092 309 978 (“RCC”) and is general advice and does not take account of your objectives, financial situation or needs. Before acting on this general advice you should therefore consider the appropriateness of the advice having regard to your situation. We recommend you obtain financial, legal and taxation advice before making any financial investment decision._


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## jonojpsg (13 March 2008)

Surely though their stash of cash would have to provide some sort of base below which they would be unlikely to fall, eg if they have $136m in cash and an MC of $200m then their operations are only valued at $64m.  

I guess when you are talking *TA* though, you're right in saying that protecting capital is about reading the charts and getting out when you should.  Maybe a short on PEM then?


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## UMike (26 March 2008)

Well they have found a takeover/merger target.

· Under the terms of the Proposed Merger, CBH shareholders will receive:
o 1 Perilya ordinary share for every 3 CBH shares;
o 1 Perilya option for every 20 CBH shares; and
o shares in Kimberley Metals, expected to be approximately 1 Kimberley Metals
share for each 9.2 CBH shares.


Will be interesting


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## UMike (29 March 2008)

UMike said:


> Well they have found a takeover/merger target.
> 
> · Under the terms of the Proposed Merger, CBH shareholders will receive:
> o 1 Perilya ordinary share for every 3 CBH shares;
> ...



How can I find out what *Perilya options* and the worth of *shares in Kimberley Metals*?

Any help will be appreciated.


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## StillStanding (3 April 2008)

I don't think there are any shortcuts here UMike and I've been trying to work it out myself. 
The value of the option can be estimated using some kind of weighted volatility based on what the resulting company will look like (I think 59% CBH, 31% PEM) and historic prices, plus I guess the best estimate of the price of the underlying would be todays PEM price. We know the expiration is Dec 2010 as well. But the implied volatility using this would probably be too high. I'm not sure how best to adjust for this in any objective way. 
The value of the Kimberley portion is also a guess, but there are clues in CBH quarterlys which can give you an idea of what the tenements are worth in-situ. 
Not much help I suppose but that's my two cents.


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## countryboy (3 April 2008)

interesting story unfolding at the southern end of the line of load. 15km out to be exact .Private company Pinnacles resources have just announced a jorc compliant resource from just 35% of their mine lease.Exact figures I'll post when i get the paper back from my wife !

ongoing stories about PEM chasing this area which could still eventuate. Pinnacles are developing the open cut mine from their own capital but surely don't have the resources to go the whole way. At some stage they will require the help of a company with access to capital.

more to come on this


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## treefrog (5 April 2008)

Aspect "Perilya (PEM) and CBH Resources (CBH) will finally merge. Broken Hill will have unified ownership for the first time. The merger is all scrip, via scheme of arrangement. It’s conditional on an independent expert concluding the merger is in the best interests of CBH shareholders and a CBH shareholder vote. PEM will offer 1 share for every 3 CBH shares – a generous deal for CBH. Only six months ago PEM traded at over six times CBH. CBH shareholders also receive 1 free $2.00 PEM option for every 20 CBH shares, expiring December 2010. PEM will own 41% of the combined entity and CBH 59%. Merger documentation is expected in early April with the vote and final court approval set for July. Prior to the merger, CBH will spin out ‘non-core’ exploration assets into Kimberly Metals. Shareholders will get a Kimberly share for every 9.2 CBH.

A merger has long made sense, though the terms are somewhat surprising. A 50/50 split seems fair but CBH extracted a premium, suggesting PEM’s Broken Hill mine is struggling more than was already known. PEM shareholders are paying the price for management taking its eyes off the core business. This has seen a lukewarm response from PEM analysts and the media. Regardless, it’s a better than average corporate deal. Significant value will be created and it makes sense for both sides. New Rasp ore will help reduce reliance on PEM’s troubled Southern Mine and fill the Broken Hill mill.

We reaffirm our Buy recommendations on both stocks individually and preferably with the merger to proceed, looking for a recovery in the zinc price, cost savings from Broken Hill and Endeavor and growth from Panorama. High cash costs make both companies unsuitable for conservative investors. The zinc price is close to the marginal cost of production and some miners are hurting. On that basis, there is potential for substantial uplift in earnings and valuations but a prolonged zinc price depression would threaten the business. The conservative combined balance sheet provides some protection and we don’t expect zinc to fall out of bed. Nevertheless that risk must be acknowledged. This deal makes the most sense for both companies and its unlikely a competing offer will come forward. The more probable play would be a takeover after the merger, though significant progress would need to be made on cost savings first.

Our combined valuation is $1.95 a share for PEM and 68c for CBH, conservatively assuming no synergies from the merger. Broken Hill has deteriorated for PEM due to a number of production issues. The merger should help solve the problems, with real benefits from FY10 onwards. Forecast FY08 and FY09 output is reduced while cash costs and depreciation estimates rise. We now expect FY08 Broken Hill production of 89kt zinc and 54kt lead at a cash cost of US$0.93c/lb, down from previous guidance of 95kt-105kt zinc at US$0.80c/lb. A strong improvement was expected in FY09 but that now looks unlikely and we downgrade to 100kt zinc. Our CBH valuation is slightly higher than the PEM merger implies as CBH is pre the spinout of Kimberley Metals. We assign a nominal $25m to Kimberley Metals. Long term assumptions for both companies remain US$0.90/lb zinc, US$0.70/lb lead, an A$/US$ exchange rate of 0.80 and a 10% discount rate. Forecast combined EPS is 1.5c in FY08 and 14.7c in FY09 per PEM share which equates to 0.5c and 4.9c per CBH share respectively.

The deal is unanimously recommended by CBH’s board and largest shareholder Toho Zinc. PEM’s chairman Patrick O’Connor will chair the combined group while CBH’s CEO Stephen Dennis will become Managing Director. *Current PEM MD Len Jubber has retired effective immediately.* The board will include four PEM and three CBH directors. PEM is bringing a strong balance sheet while CBH brings a better pipeline of exploration and development opportunities.

Close to $200m in operating and capital cost savings should come from Broken Hill by FY11. Use of PEM’s spare capacity will avoid $70m to build a separate mill for the Rasp mine. CBH will not need to recruit a separate new workforce. Rasp production will be brought forward to June 2009, dependent on receipt of government permits by October 2008. Some high grade ore on the lease boundaries will be accessible for a modest near term production uplift. Post FY11, expect ongoing operating cost savings of at least $30m a year. Potential for additional savings will be explored with more likely to be found. PEM previously indicated a US20c/lb zinc cash cost saving from running its Broken Hill mill at full capacity. This suggests operating cost savings closer to $50m a year.

The combined group will be capped at around $500m. The balance sheet will be strong with $313m cash and $243m debt, most of which is convertible notes which will convert. Proforma 2007 production was 220kt of zinc and 72kt of lead. Diversification will reduce operating risk with ore sourced from five mines. The merged group will have a reasonable pipeline of exploration and development options. Combined group resources and reserves are 10.3Mt and 4.1Mt of zinc equivalent respectively. 


*Combined sensitivities per PEM share. For sensitivities per CBH share, divide by three."

emphasis mine - a fighting chance now for PEM with spin merchant gone


----------



## Plasmo (5 April 2008)

UMike said:


> ha ha....I totally agree with you.
> 
> I have no idea what is driving the price down Zinc, Copper and Silver have increase greatly in Price,.
> 
> Bin Larden's in a mountain in Afgan I tells ya.




Uh, Chinese ramping up Zinc production and becoming a net exporter rather than importer might have something to do with it?  Anyone considering investing in Zinc would be wise to take note of that.


----------



## countryboy (7 April 2008)

my understanding is that CBH initiated the deal with PEM. PEM have really been directionless as to its future apart from a short lived play at Heron.

My two cents worth is this project just 15km out of Broken Hill Pinnacles Mines: released a jorc statement of 400,000 tones lead,51 million ounces of silver, 575,000 tonnes of zinc, 12,000 tonnes of copper and 210,000 ounces of gold This was achieved off just 35% of the lease being drilled. geo Tim Hopwood put an estimate of 30 to 60 million tonnes on the resource.

This company is a private entity and will need some capital to mine this area.

get out the wallet PEM !


----------



## countryboy (27 April 2008)

Production out of Broken Hill increased by 22% for lead 22,000 tonnes and six percent Zinc: 13200 tonnes in the last quarter. Target for full year is 90,000 tonnes of zinc and 55,000 tones of lead.

Decreasing zinc price (and it has not tanked!) is offset by increased lead price.


----------



## countryboy (30 April 2008)

*60% upgrade of Flying Doctor Resource *to 104,600 tonnes of contained zinc and lead.
Perilya Limited (ASX: PEM) is pleased to announce a 60% increase in the mineral resource estimate for the Flying Doctor lead and zinc deposit to 1,450,000 tonnes @ 3.2% zinc, 4.0% lead and 44g/t of silver. Flying Doctor is located approximately five kilometers north of company’s Broken Hill Southern Operations and two kilometers north of the Northern Operations.

looks like an open pit to 200m depth

plenty more ore to pul out of Broken Hill


----------



## doogie_goes_off (30 April 2008)

Looks like i'll be back in black before you know it. PEM is the sleeping giant IMHO. I am holding on with white knuckles incase the ride starts (also grinding my teeth incase they fall more)


----------



## GREENS (30 May 2008)

Have to say Perilya is not looking to crash hot at the moment with zinc and lead prices taking a beating. In the last quarter out of memory I think they had an operating cash cost of $US0.94/lb for zinc. No wonder they had no choice but to merge with CBH and there share price is where it is at the moment. Anyone know how long until CBH’s (Broken Hill) CML mine starts production and feeding its ore into PEMs broken hill concentrator? As this should cause costs to decline significantly from their current levels.


----------



## countryboy (4 June 2008)

Queensland, 100 per cent ownership, Copper

An 80% increase (announced on 28 February 2008) in the Mount Oxide mineral resource estimate to 203,000 tonnes of contained copper, together with the majority Indicated status of the resource, strengthens the project’s potential for development in the current strong copper market.

Mount Oxide has considerable potential as a low cost near term development project. Mount Oxide is located in a proven mineralised system in the highly prospective Mount Isa region and is part of Perilya’s 720 square kilometre tenement holding in this area.  It is close to existing infrastructure.

Within the project area, Mount Oxide mine produced 51,000 tonnes of secondary copper ore at a grade of 21 per cent copper from an underground mining operation to a depth of 90 metres below surface, prior to 1958. Between 1968 and 1971, an unknown quantity of ore was also extracted from an open pit at the mine.

The potential of the deposit was proven by previous shallow open cut mining and the resource is open at depth.  Mount Oxide is located 25 kilometres from an under-utilised processing facility and close to a major mining service town.


drilling was to start in April 08

had to post something positive about this stock as it continues to drop


----------



## Synergy (5 June 2008)

Relief perhaps in sight for you countryboy, some nice drill results released today:


_Perilya Limited (ASX: PEM) is pleased to announce spectacular drill intercepts at depth below the main Mount Oxide
resource, including:
*
- 22m @ 6.3 % Copper and 0.3 % Cobalt from 258m;
- 19m @ 3.7 % Copper from 315m;
- 31m @ 6.2 % Copper from 346m; and 
- 23m @ 8.9 % Copper from 395m.*

The high grade intercepts occur in one hole between 258m and 418m downhole.

Perilya’s Executive Chairman, Patrick O’Connor, said that the intercepts highlight Mt Oxide’s upside potential for expansion.

“These intercepts are outside of the current resource and have significant prospects at depth.”

“The results are particularly encouraging for either defining a high grade underground resource or deepening the planned open pit,” he said.

Drilling commenced in April with two diamond rigs to infill and expand the current resource of 203,000 tonnes of copper
and to define the potential of the project._


Interesting to see what effect they have on a stock in such a heavy downtrend...


----------



## countryboy (5 June 2008)

i sold on todays small rise....massive loss
will look to buy into CBH at around 20c close to the merger date

cancelled a stop loss at around $3.40


----------



## cordelia (5 June 2008)

countryboy said:


> i sold on todays small rise....massive loss
> will look to buy into CBH at around 20c close to the merger date
> 
> cancelled a stop loss at around $3.40




I bought these at 3.40....sold at 1.92....I lost heaps too

This was the biggest loss I have ever had. Taught me a real lesson about entry and exits. I know its hard but try and learn from the experience. I know exactly what I did wrong which is something positive


----------



## BAM (5 June 2008)

Hi
Does anyone have any new thoughts on PEM?
Closed down again. How do people think the merger will affect the stock?

Released positive drilling results today, any thoughts?
Can you see a recovery in the mid-term?


----------



## Max_ob (5 June 2008)

i bought at $1.03 and am still holding at a close of .68 after a good announcement . . . . 

am slowly learning about stop losses myself. . . . 


merger hopefully be finished off soon and then maybe it will crawl back . . . maybe bottom draw it as i've heard other people say. . .


----------



## aramis (10 June 2008)

I bought in at 0.93 and am holding.

I dont really know why the share price is still falling, this company has too many positives.  Zinc prices are falling true, but these guys have plenty of cash in the bank, so if zinc falls and smelters get closed down, that in itself will cause zinc prices to go back up (as supply will decrease) and as such, Perilya will be in a good position to sell at a higher price.  Due to cash @ bank being so high, I doubt they will close anything.

Secondly, I suspect (mere speculation) that short-sellers are to blame for the share price falling so heavily...  That is, people selling (by borrowing from an institution for example) at the start of the day and this in itself causing the price to fall and then buying towards the end of trade or once it has fallen enough for a profit.

I also suspect that many people have made losses on this stock so many people are crystalising their losses (i.e. selling the stock and then re-buying perhaps now or perhaps a bit later so see if it falls even more) before the end of the financial year in order to reap the tax advantages associated...

Overall, I think that the price of the stock right now is really good, and if I didnt get in at .93, I would have been buying much more of this right now.  Its not about whether it will get back up, its about when. 

As for people selling right now, why bother sell now? can it honestly get any worse?  As some of the people already here mentioned, they got enough money in the bank, plus stockpiles of zinc, plus they are merging hopefully soon ... all these easily equate to a much higher share price than what it currently is at. 

My feeling is, when this stock starts going back up (and I feel it will probably be July as soon as financial year has ended), it will start climbing fast as it appears to be undervalued for the above mentioned reasons. 

Anyone think otherwise? give me your reasons and I'll be happy to discuss :


----------



## Stan 101 (10 June 2008)

The issues with PEM are starting to compound now. Zinc is under $1US and is just about levelling with the cost to PEM to pull it out of the ground. Sure there are other metals pulled out of the tailings but for a basic, it's one for one. Lead is in the same boat.
At the point where there is such a price parity a business starts to dip into reserves. 
The CBH merger is not a given. It is now trading at a premium to PEM. Who would want to vote to lower their share price? The answer may be n the synergies and savings by sharing overheads, getting the Rasp up and running at least 12 months earlier and a potential takeover bid with the new entity.

CBH's operating costs are not that much better than PEM and I cannot recall seeing any projected operating costs of the new entity.
People may be selling down PEM simply due to margin call. Remember this thing has been in basically freefall for nearly 12 months along with Zinc prices. I too thought it had bottomed at $1 but it sure proved me wrong and burnt me a bit. I jumped out at my loose stop loss.
The word Perilya is looked upon like a deviant term at the moment. 

I've just looked at NAB margin and PEM and CBH is still at 60% leverage. That is a positive. Agius(?) still have a 12 month view of PEM to have them trading at $2.01 as of late may.
Zinc needs to bottom and start that long climb back before this share can really look like stabilizing. 
Yes I think there is a future and why I held CBH and often traded it. Time will tell.
They could do worse than get a name change, a good publicist and an operations management audit. They need to get their costs down and turn this around. They also need to let people know of the change. A shakedown of the management team would be a bonus, too. No matter how they have really performed, there is a certain stench on them all in bourse circles.


Cheers,


----------



## Miner (11 June 2008)

Stan 101 said:


> The issues with PEM are starting to compound now. Zinc is under $1US and is just about levelling with the cost to PEM to pull it out of the ground. Sure there are other metals pulled out of the tailings but for a basic, it's one for one. Lead is in the same boat.
> At the point where there is such a price parity a business starts to dip into reserves.
> The CBH merger is not a given. It is now trading at a premium to PEM. Who would want to vote to lower their share price? The answer may be n the synergies and savings by sharing overheads, getting the Rasp up and running at least 12 months earlier and a potential takeover bid with the new entity.
> 
> ...




Stan 101 

Good thoughts and thanks

Question is who is going to convey PEM about what you suggested as they shoudl do etc. If they were smart enough to research and learn then our postings were not necessary and there was all green around PEM and CBH

If you refer to my old postings when I did say that CBH management is  an incompetent ones and they have just made a good growth prospect into a sickening farce. 

Probably CBH management shoud join with ABS Eddie and Bryerty Director to make a sick company and ask MK to be its chariman to make the full circle of incompetency 

Sorry for frustration as in a rising resource market investors are just loosing money for their faiths being shattered by such unworthy management of PEM and CBH


----------



## Stan 101 (11 June 2008)

Miner said:


> Sorry for frustration as in a rising resource market investors are just loosing money for their faiths being shattered by such unworthy management of PEM and CBH




Are we really in a resource market that is rising? Can you give me some examples of this? The only commodity I've noticed (and I've not looked that hard) with a demand outstripping supply scenario is iron ore.

Cheers,


----------



## Miner (11 June 2008)

as reported in FN Arena today (11 June) 

Macqquarie rates PEM as neutral . An increase in cost assumptons has led the broker to downgrade both PEM and CVH and the target for PEM falls from $2 to $1.  

Disclaimer : I do not hold PEM


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## oldblue (11 June 2008)

As at 31 March 2008 PEM had $85.5m cash, 43cps, or 29cps net after debt of $28.2m. I wonder how quickly this is being spent? 
The other question that exercises my mind is their hedging position. They had hedged a quantity of zinc forward in the 2008 financial year but not much further out. Seems to be a fair bit of lead sold forward. Does anyone have a handle on this and what the financial effect ( benefit) could be in the current year?

Disc: Don't hold but very nearly bought around $1, and still interested.


----------



## Max_ob (11 June 2008)

lucky you. . . . i did buy in at $1.03 

and silly enough to still hold. . . .and not confident enough to average down right now


----------



## kkyyoo (11 June 2008)

it hits 0.55 today... 

Bought it at $1 and still holding it

Hoping for some miracle to happen after the merger is done and the metal prices picking up as the OPEC meeting is being held to increase oil production to tackle the rising oil prices (which indirectly affect the metal prices )

not prepared to lose half of my money.... 

anyone has any idea what the hell is going on ? is it gonna go down again  ?


----------



## aramis (11 June 2008)

lol, I got in at.93 and now .545.  

errrrrmmmm, I am not prepared to sell now either, lol, just imagine how the people who bought at $5 and still holding freel?  

Upside is, they got plenty of cash, low debt, they own a mine and a lot of equipment, they are proposing a merger... and the stock is pretty cheap right now so I suspect institutional investors will be in as soon as financial year end. 

I agree on poor management though... when share prices are going down dramatically on a regular basis, when there is nothing actually changing in the company, then it is important for management to express their opinions to the market and assure the market that nothing is going on, business as usual.  This can be through a market announcement or media interview.  However, both PEM and CBH management have totally lacked any initiative in this department.  Very disappointing...

Overall, I think I might wait a bit, see if it goes down any more, and if so, buy up and sell in the middle somewhere to break even or make a bit.. we'll see/.


----------



## aramis (12 June 2008)

Looks like PEM is back on its way up... 

Strong BUY depth compared to sell...

Opened higher currently at .595.


People finally realise this is going back up...  My prediction (speculation only) 0.75 by end of the month. 

WOOT GO PEM GO!!!

P.s. I got in at 0.93 and .545


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## oldblue (12 June 2008)

oldblue said:


> As at 31 March 2008 PEM had $85.5m cash, 43cps, or 29cps net after debt of $28.2m. I wonder how quickly this is being spent?
> The other question that exercises my mind is their hedging position. They had hedged a quantity of zinc forward in the 2008 financial year but not much further out. Seems to be a fair bit of lead sold forward. Does anyone have a handle on this and what the financial effect ( benefit) could be in the current year?
> 
> Disc: Don't hold but very nearly bought around $1, and still interested.




Good to see a bit of strength in the SP on a down day.
Still searching for the answers to these questions.
Any takers?


----------



## kkyyoo (12 June 2008)

Todays up because of the announcement of the Flaunders mine as a new resource

http://www.perilya.com.au/articles/...80612_Reliance_resource_asx_release_Final.pdf

And yea, a really strong buys too.. compared to yesterday 

Hopefully its going back up now


----------



## Miner (12 June 2008)

Miner said:


> Stan 101
> 
> Good thoughts and thanks
> 
> ...




At last CBH management read our stories and here u go 

See the attachment of management changed and Stephen Dennis stepped into


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## aramis (13 June 2008)

Ahhh, whats with this stock!!!

I'm out of this one.  I just dont get it, had two positive announcements and still didnt really recover.  Plus the buys are starting to disappear again...

Hmmm, probably has something to do with the price of zinc... I guess it is going to take a bit of time before production of zinc slows down and accordingly, the price after that goes back up... even then, as one of the other guys here mentioned, you have to question how quick their cash in the bank is being spent...

dunno...  anyways, will always keep an eye out for this stock.

What do u guys reakon btw... the commodity "boom" is coming to an end?


----------



## kkyyoo (14 June 2008)

Completely clueless about this one 

CBH changed management
2 positive announcements
merger is going to take place 

this share should go up rapidly ... or not ? or theres some people on the back stage playing with the share price ?


----------



## GREENS (19 June 2008)

oldblue said:


> As at 31 March 2008 PEM had $85.5m cash, 43cps, or 29cps net after debt of $28.2m. I wonder how quickly this is being spent?
> The other question that exercises my mind is their hedging position. They had hedged a quantity of zinc forward in the 2008 financial year but not much further out. Seems to be a fair bit of lead sold forward. Does anyone have a handle on this and what the financial effect ( benefit) could be in the current year?
> 
> Disc: Don't hold but very nearly bought around $1, and still interested.




Old Blue 

All of Perilya’s hedging is on page 7 of their latest quarterly report. You can work out then based on a current zinc price what the benefit or loss will be for each contract. 
http://www.perilya.com.au/articles/...port_for_the_3_months_ended_31_March_2008.pdf

In terms of how quickly there going through their cash. I would say they are going through it a lot quicker than shareholders would like. At a Zinc price of 0.85/lb they must surely be operating at a loss now. There cash costs for the last quarter were around $0.94/lb of zinc. 

I think the only relief for shareholders in PEM and CBH is a merger and in turn a greater focus on operating efficiencies, particularly in the broken hill region. That is getting more ore through the broken hill concentrator to bring cash costs back down and therefore attempting to make the broken hill operations more profitable. Also bringing on line the lower cost Panorama Zn-Cu and Mount Oxide Cu project as well as exploiting the high grade Beltana style deposits is a major stepping stone for rebuilding the merged entity towards a lower cost producer and a more successful and sustainably profitable company going forward. There are a few bright spots for the merged entity in the longer term, but management must first show their ability to run the company near its potential before investors will jump back on.


----------



## kray192 (20 June 2008)

Does anyone know if PEM uses LME or SHFE prices. SHFE prices are 10-20% above LME, so PEM could still operate at a profit under SHFE prices.


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## kkyyoo (20 June 2008)

Went into trading halt today

so do CBH ...

I wonder if it got something to do with the merger ? 
(I thought they are supposed to be merged at early July )


----------



## legs (24 June 2008)

kkyyoo said:


> Went into trading halt today
> 
> so do CBH ...
> 
> ...




announcement:
http://www.asx.com.au/asxpdf/20080624/pdf/319smsytd8h9xq.pdf
PEM rejects merger even after a newer offer of 3.5 cbh shares for each PEM share compared to original 1 for 3 shares! 

2 more new announcements...
http://www.asx.com.au/asxpdf/20080624/pdf/319smrgt5yb6sp.pdf
http://www.asx.com.au/asxpdf/20080624/pdf/319smnkn5ghpzw.pdf

PEM concerned on changes made at CBH operations since merger talks started and hedge books with CBH. Metal prices have tumbled and effect on CBH reserves and operations the major concern.


----------



## trevormc (28 June 2008)

The power of zinc: Startup CEO talks zinc-based fuel cells 

Washington (Platts)--26Jun2008
Robust supply and softer demand has transformed zinc from a hot to a
lukewarm commodity, but new technology that would make zinc the power running
cell phones and laptops -- and a significant distance down the road -- a fuel
source in hybrid cars, could help launch the base metal's comeback. 

     Power Air Corp., based in Livermore, California, announced this week it
had entered into a technology-sharing deal with Hawthorne, New Jersey-based
eVionyx to make zinc-based battery units called Powerpacks, that will give
extended-run capability to increasingly sophisticated -- and power-hungry --
mobile electronic devices like Blackberrys, MP3 players, and global
positioning systems. 

     "People don't know that zinc is a potential energy source," Power Air
President and CEO Donald Ceci, told Platts. "Eventually, if the world was
running on zinc, you'd have sustainable fuel." But, he added, "There's a lot
of development work to be done." 

     The technology is known as the zinc-air fuel cell, which gets its name
from the underlying chemical reaction that occurs when zinc pellets are mixed
with oxygen from the air, causing zinc oxidation. Lithium is the material
currently used in the batteries powering mobile electronic devices, but
deposits of the commodity are more scattered and scarce than zinc, and
increasingly pricey in the face of insatiable demand for the next big thing in
electronics, Ceci said. 

     "There's not that much lithium; you get it from salt lakes on the tops of
mountains in Chile and China." While those are not the only regions where the
material is found, he said, "There's certainly not enough to run the world's
hybrid electric vehicles." What's more, Ceci added, "Lithium is getting more
and more expensive because all the portable devices are running on lithium. So
zinc is developing into the next-generation alternative to lithium. We're
pioneering that to an extent." 

     Although the current crop of hybrid vehicles have fuel cells based on
lithium or hydrogen, the zinc-air fuel cell is safer and better for the
environment, he said. "The nice thing about zinc is, it's nonflammable and
nonexplosive and you end up with zinc oxide as a byproduct, which is totally
recyclable. You don't burn anything up into the atmosphere [so] there's no
emissions." Also, "of all the stable elements, zinc has the highest energy
density, so it is a very good power source," Ceci said. 

     These qualities could raise the base metal's profile as a fuel source and
drive up its price on the order of metallurgic coal -- the coal used to make
steel -- the price of which has soared on rocketing steel demand from China.  
"Broadly speaking, I think this is a trend that going to grow not only in
North America and Europe, but around the world," Bart Melek, a commodities
analyst with BMO Capital Markets, told Platts. "Certainly with oil at
$135-138/barrel, we're going have to use other ways [to get power]." 

		--Laura Gilcrest, laura_gilcrest@platts.com


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## kkyyoo (1 August 2008)

so it looks like the company is going no where now ...

Any ideas what is going on ? 

they already officially terminated their merger with CBH... 

From their last quarter report

• Metal production at Broken Hill increased 18.5% on the previous quarter
• Full year production from Broken Hill of 91,295 t of contained zinc and 52,412 t of contained lead
• Significant exploration results at Broken Hill and Mount Oxide and an increase in mineral resources
• The value of Perilya’s projects and assets is receiving interest from a number of parties
• Reverse takeover proposal from CBH Resources rejected as inadequate

at least they are taking profits this qtr compared to prev qtr

June qtr profit = 0.03 US$ /lb zinc
Mar qtr loss = (0.12) US$ /lb zinc

*A strong focus on cost control and higher production volumes resulted in the direct cash operating cost reducing by 13% to
US$0.96/lb during the quarter, resulting in an improved cash operating margin.*


----------



## aramis (6 August 2008)

This stock is starting to look good again...  

0.35 and I'll be in.  Word on the street is that zinc will be up 2009 as many companies have reduced production and steel requires zinc in some sectors? anyways, article I found... 

http://economictimes.indiatimes.com...demand_from_steel_cos/articleshow/3312409.cms

lol, I feel sorry for the ppl who bought at $5 if they are still holding this one.


----------



## treefrog (12 August 2008)

may still have a bit to go on current fundamentals, but 40c is strong LT support line (if you have a bent for LT S/R lines.........and cash on hand is 39c/share; today PEM at 44.5c
PEM made +3c profit/lb (after belt tightening) on an ave Zn price of 96c for the 1/4
Today Zn down to 75c/lb
PEM took over from Pasminco who morphed into Zinifex who morphed into OZL - (OXL and ZFX)

Interesting chart comparison over the last 5 years


----------



## treefrog (21 August 2008)

local rumor (very sketchy though), is that currently management meeting with workers and offering 435 redundancies - appears to be the total workforce here
repeat *very* unconfirmed


----------



## Sean K (21 August 2008)

treefrog said:


> local rumor (very sketchy though), is that currently management meeting with workers and offering 435 redundancies - appears to be the total workforce here
> repeat *very* unconfirmed



 Crikey! Could PEM and CBH both be put into mothballs until their commods recover? 

It's a bit early to be picking up rumours from down the pub treefrog!

Is a mining town I suppose...


----------



## Speewha (21 August 2008)

Hello

This morning’s Fin Review 

 “Perilya broke the news at a shift change last night that workforce of 750 would be reduced by about 450 “. 


Regards


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## prawn_86 (21 August 2008)

Yes this news was also on the ABC's Madday report.

PEM said they will re start operations when the Zinc price recovers sufficiently


----------



## UMike (21 August 2008)

kennas said:


> Crikey! Could PEM and CBH both be put into mothballs until their commods recover?
> 
> It's a bit early to be picking up rumours from down the pub treefrog!
> 
> Is a mining town I suppose...



Not exactly Mothballs.

"A resizing of the Broken Hill Operation to focus on a reduced tonnage, lower cost
operation at the Southern Operations. The North Mine and Potosi exploration decline will be placed on care and
maintenance." is a quote from there recent ANN.


----------



## doogie_goes_off (27 August 2008)

Strength coming back into the cobalt price should see PEM tick up on the back of Mt Oxide...

"New York (Platts)--25Aug2008
Cobalt prices have bounced sharply as a result of traders buying around
100 mt of cobalt from BHP Billiton in the space of just four working days,
with prices of transactions climbing by more than $5/lb since last Thursday"


----------



## legs (12 September 2008)

got a rocket in its butt today...up 56% so far 10 minutes before close. Obviously traders liked the spin off of Mt Oxide and acquisition of purchase of 200m shares in Chalice. 

Not before its time though.


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## Hendrik (12 September 2008)

legs said:


> got a rocket in its butt today...up 56% so far 10 minutes before close. Obviously traders liked the spin off of Mt Oxide and acquisition of purchase of 200m shares in Chalice.
> 
> Not before its time though.



It was heavily oversold in recent months, this week was a real downer for it pushing it below 52 week lows and support, so anyone who scalped this one today, well done


----------



## fighting41 (12 September 2008)

I got on Perilya when it went to $0.40 and yesterday was watching my portfolio at 3.25pm when it colapsed from $0.32ish to around the $0.17.

After wasting a minute trying to work out what had happened and why, I was able to get on again at $0.19

I was cheering when it was up 70% at one stage today.



> Sept. 12 (Bloomberg) -- Perilya Ltd., an Australian zinc and lead producer, rose the most in 17 years in Sydney trading after Credit Suisse Group boosted the company's rating, saying the stock is ``well below'' its value.
> 
> Perilya jumped 61 percent to 33 cents on the Australian stock exchange, making it the benchmark index's biggest gainer. Perilya has lost more than 88 percent of its market value this year.
> 
> ...




http://www.bloomberg.com/apps/news?pid=20601087&sid=aTvqMZ49Hwpw&refer=home


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## michael_selway (12 September 2008)

fighting41 said:


> I got on Perilya when it went to $0.40 and yesterday was watching my portfolio at 3.25pm when it colapsed from $0.32ish to around the $0.17.
> 
> After wasting a minute trying to work out what had happened and why, I was able to get on again at $0.19
> 
> ...




Hm that sounds scary

*Earnings and Dividends Forecast (cents per share) 
2008 2009 2010 2011 
EPS -10.3 6.2 14.6 12.7 
DPS 1.0 0.5 0.0 0.0 *



> Date: 12/9/2008
> Author: Jamie Freed
> Source: The Sydney Morning Herald --- Page: 21
> Investors have again been disappointed by Australian zinc miner, Perilya. It hashad a difficult year in 2008, with falling zinc prices, a failed merger,redundancies, write-downs and poor results, with its share price falling from apeak of $A4.42 in November 2007. Perilya sold its Mount oxide copper project inQueensland to Chalice Gold Mines for $A25 million on 11 September 2008. However,the fact that the transaction was for scrip, not cash, caused its share price tofall by $A0.115 to $A0.205




thx

MS


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## legs (12 September 2008)

"Date: 12/9/2008 
Author: Jamie Freed 
Source: The Sydney Morning Herald --- Page: 21 
Investors have again been disappointed by Australian zinc miner, Perilya. It hashad a difficult year in 2008, with falling zinc prices, a failed merger,redundancies, write-downs and poor results, with its share price falling from apeak of $A4.42 in November 2007. Perilya sold its Mount oxide copper project inQueensland to Chalice Gold Mines for $A25 million on 11 September 2008. However,the fact that the transaction was for scrip, not cash, caused its share price tofall by $A0.115 to $A0.205"



Thats old news as it didnt fall today...it went up 61%.

The fall was from the day before. It rebounded very strongly today.


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## oremo (10 March 2009)

*PEM - Perilya Mining*

I'm holding 100,000 shares at average cost 27 cents..
I kept buying in at what i thought was the bottom.

I know...some say that's dumb.

Seemed simple at the time...

buy when everyone else was getting out
Zinc stockpiles will be consumed & create demand...eventually...

Am I any chance of recouping?

Appreciate some feedback

Oremo the newbie


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## UMike (11 March 2009)

*Re: PEM - Perilya Mining*



oremo said:


> I'm holding 100,000 shares at average cost 27 cents..
> I kept buying in at what i thought was the bottom.
> 
> I know...some say that's dumb.
> ...



If "Zhongjin Lingnan" aquired 50.1% of PEM for $0.23 we have buckleys of seeing $0.27 anytime soon.

That they didn't merge with CBH astounds me.

Life goes on.


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## oremo (12 March 2009)

The  "Zhongjin Lingnan" aquisition (50.1%) for PEM for $0.23 was interesting.

At least they value PEM at $0.23 in the current market conditions which indicates that it's good long value at the moment. Only needs a bit of demand to send the price up.

They are obviously thinking long.  

News out of China points to stockpiles slowly running out. 

Feel a bit of confidence coming back

Anyone out there got some concrete info? 

Life goes on and on and on.........:walker::walker::walker:


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## oremo (14 April 2009)

Knew PEM would go up. Hit up to 29 cents today and settled back to finish up at 27.5 cents. Up 8 cents on the day. Not bragging just relieved and happy to go square. What will happen tomorrow? Dow futures look good for tonight.

Seems China is either stockpiling Zinc at cheap prices or their consumption is growing. Lots of good news out of China in general.

Holding 77,000 shares and am up by $850 

Tempted to bail out but going to sleep on it. Anyone care to comment on where this stock is  or sector is going?


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## misterS (16 April 2009)

oremo said:


> Knew PEM would go up. Hit up to 29 cents today and settled back to finish up at 27.5 cents. Up 8 cents on the day. Not bragging just relieved and happy to go square. What will happen tomorrow? Dow futures look good for tonight.
> 
> Seems China is either stockpiling Zinc at cheap prices or their consumption is growing. Lots of good news out of China in general.
> 
> ...




Hi Oremo, 

This Perilya and Kagara action has spurred me to start thinking about zinc again, which I did when making a quid out of Zfx as zinc got to $2/lb.

I wouldn't pretend to advise you, being just a mug punter, but will presume to volunteer the little I learnt from that period anyway.  

Perhaps you already know, although I didn’t to begin with, the very basic thing is that there is a base metal cycle - demand rises above supply, the prices goes up sharply, speculators increase the effect, but the price is absolutely pole-axed eventually by the overpowering massive over-supply response.  Zinc is a common metal and a good price gets miners cranking it out.   The price movement is aided and abetted by mysterious speculators.  ("Nuclear winter in base metals" by Frank Veneroso was an interesting read in that respect)

So, the price of the metal is the driver of the SP of producers, bearing in mind debt level, the amount of resource they have and the price of their production per lb – which reflects its accessibility, ratio, contaminants, etc., etc. and of course the lead you get when mining zinc.

So, provided you are happy with the recovery cost, the management, the resource, it is all about the price of zinc (and lead).  This is primarily where you have to concentrate your research.

Simple things like having a Google on "zinc demand supply" and so on will give you a start on what sorts of articles and opinions / statistics / forecasts are around. Kitco has some good historical charts of prices and LME holdings of the metal. Of course, there are non-LME stockpiles as well and stockpiling and de-stocking by the various producers and users alike (and sometimes, it is rumoured, by price manipulators). There are all sorts of commentaries about supply/demand and futures trades and so on. A poster called “Brend” seemed to be the ducks nuts on commodities and zinc on Aussie stock Forums

From a very quick squiz at their website, (you’d need to check what I am saying is correct - have a gander at their website) Perilya says it has no debt, and currently claims to produce at around 60 - 65c per lb, having recently reduced costs (and production). 

Despite the lack of debt, it appears they would have collapsed without a capital injection provided by the Chinese getting 50.1% for $45m. You can’t keep producing something that sells for less than it costs you to produce for any length of time.  

This Chinese intervention is predominately a comforting one (to me).  For one thing, it indicates the resource is very satisfactory.  Resource security is clearly important to China. It seems reasonable to expect China is pleased to have snapped up these resources cheaply and so the short-term price is probably not their primary concern. They are not likely to relinquish them just because they lose money for a period.  Although, the other side of that coin is that they may not feel compelled to mine it at a loss - happy enough to know it is there – and theirs.

So, as always, whether the price keeps going up seems to be the question that will bear on whether Perilya SP does too, but since the Chinese have come on board, this may allow some leeway in how critical the immediate zinc price is.

You would think China is not taking these cheap companies with good resources to just let them fold due to short-term market price problems – after all, that is exactly how they came to acquire them in the first place, isn’t it? China wants resource security, it doesn’t care about losing a quid for a year or however long they think is tolerable – quite a long time I suspect.  The profit imperative is not so demanding when your access to capital is not really constrained. 

As a cycle, zinc will go back up again at some stage – and the money made during the boom times is considerable.  If you had China’s resources, you wouldn’t be too upset by a delay in realisation of an investment.  Let’s say the price of zinc gets above a dollar again in 2012 or 2013? 

On the other hand, there are some commentators who say the zinc price will remain flat for a couple of years.  Even if this proves correct, it will not be falling after that.

If I understand it correctly, when the massive over-supply response shocks the base metal price, it reverts pretty much to cost of production.  However, in this case, rather than massive over-supply causing it in the usual way a base metal price rout occurs, it has been due to the sudden erosion of demand caused by the general financial crash that has affected demand and perhaps more accurately, “perceived demand”, and not over-supply itself – except relatively speaking.   I’m not sure the distinction drawn there necessarily holds much water, of course demand / supply is relative, or whether it can be extended to a meaningful consequence, but it is a working hypothesis for me for the time-being. 

Accepting that proposition, then stimulus and any sort of recovery could have a sharp effect on base-metal price, because the usual true cause of base-metal flat-line is massive over-supply response which overshoots demand by a long way because of how long it takes to bring production on-line, not merely temporary demand erosion, which at least has the potential to be more quickly restored.

Prior to doing any sort of real contemporaneous reading or research, my initial feeling is that the base-metal prices will continue to improve simply because of the absence of massive over-supply.  Demand erosion skewing the demand supply equation is not of the same long-term magnitude as the classic massive over-supply response which cruels the price for an extended period. 

Perilya looks to be a good company with no debt, who made sensible rationalising moves when the zinc price crumbled, has improved production costs which are around the current price of zinc and better financial depth and therefore the luxury of more time because of its new major stockholder.

I wouldn’t presume to give advice to you about your holding, but there should be some comfort in the fact the independent advisor gave a valuation around 30-33 cents when the Chinese took their stake, although I don’t know what price they assumed in their valuation.  The fact the price of zinc is around 65cents tonight on Kitco is not bad either. 

Given the previous Perilya SP there must be many, many unhappy holders who wished a price of 29 cents put them in the black and I would be feeling more excited than anxious being in that position.  The Chinese backing and the cash itself both provide some longer term security, but of course, depends on what else you hold, risk appetite, etc.

I might have a bit of a nibble myself after a bit more of a sniff around.  I always feel stupid talking actual prices because I am seldom right, but after a 41% increase, a retrace of a couple of cents would not be unheard of. 

On the other hand, if their longer-term survival looks more certain now, then significant increases could well be sustainable.  The aftermath of this crash sees the Chinese snapping up resources at bargain prices and people making real money in the market.    

A modest base metals rally doesn’t depend on the world booming again - it just has to be going along wanting more zinc than is available.  There will presumably be some production curtailed (as by Perilya) and some imbalance in re-starts versus immediate demands.  

As far as the condition of the world economies, I slightly discount the bears’ current profile in forums and the media because this prominence flows from a natural bias towards the flavour of events which have already occurred – which is not to say everything is rosy, but there is a lot of things that still need to be going on and a lot of money wanting a profit and an awful lot of people with aspirations which generally manifest at some level as “wanting stuff”.  The various stimulus packages have a big infrastructure component, good for copper and zinc.

Sorry to have gone on so long, but it has got me thinking zinc again in my amateur way and the straightforward equation once you make the complicated decision of whether and who (and when) to invest in with a zinc producer has its own appeal:

Open Kitco -check zinc & lead price - hooray, or boo hiss.  

Cheers,


----------



## oremo (16 April 2009)

Hi MisterS

Thanks for your reply. You have illuminated me. You spoke my language and raised many thought-provoking viewpoints. So many in fact that I am giving serious considertaion to your logic as I like to digest information and then ponder. I'll come back to you with some feedback.

Today PEM is up 3.5 cents so far. To say someone out there has faith in zinc would be an understatement.

Thanks again for you eloquent and informative reply and I'll check out the information resources.

Cheers


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## misterS (17 April 2009)

oremo said:


> Hi MisterS
> 
> Thanks for your reply. You have illuminated me. You spoke my language and raised many thought-provoking viewpoints. So many in fact that I am giving serious considertaion to your logic as I like to digest information and then ponder. I'll come back to you with some feedback.
> 
> ...




Hi Oremo, thanks for that generous reply.  The philospher and scientist Herman Helholz said that the genesis of an idea lies in a process of saturation, incubation, illumination, so you are in good company with getting info and pondering it. 

Good to see Pem put another quid, (potentially, at least) in your pocket today.  On that point, if you take a profit and then get back in to the same company later, at a higher price, you do not lose any of your capital, it has still increased by your profit.  You merely have less shares and still suffer or enjoy whatever fate befalls the price going forward from that point. The bit between is not really something you have "lost", except in the sense it is a profit foregone (or a loss avoided) and of course the CGT issue.  

Although, I found CGT considerations to be a distortion and a trap.  You hang on to shares come hell or high water waiting for the 12 months to be up and sometimes your profit dwindles or turns into a loss.  I finally realised I should rather pay tax on a profit and trade as I saw fit, than passively wait to see where the price is in 12 months.  Of course, it shouldn't be ignored, but be seen only as a side-issue, not the central decision driver. 

I've pondered a bit more myself about whether the sheer sudden dislocation to zinc producers is a positive factor for Pem. Plenty have shut or reduced production and ramping back up is not an overnight process, but if you are a user, you need it when you need it.  Smelters lay off workers and suspend operations for lack of concentrate, or cash to operate because the margins are too tight, etc. 

This brings me back to my hypothesis that because the cause of the recent price rout of base metals is different, therefore the consequences will have a different pattern.  The immediate effect was the same, reversion to production cost, the same as if the cause had been the traditional massive oversupply response.  However, even the improvement to date is probably quite different.  (I'm too slack to do the research to see if there actually are any little rallies when massive oversupply kicks in, but I suspect there are very few).

Also, reviewing some old notes, I see China uses about 2 and a half times as much zinc as the USA, so China's economic performance is more important to the zinc market than the USA.  I read that the Shanghai price is currently higher than the LME price and that is causing imports for China and also increasing the LME price. Not ignoring the fact that USA is a big market for China, but infrastructure is not an export. 

Bloomberg says zinc futures surged 5% for July delivery on the Shanghai futures market, but at the same time they have an article about the Chinese economy slowing, so which way are they going?

The fact China is buying zinc mines may be an indication of what they think about it - although, not to forget they may be more interested in supply security more than simply profit, in my opinion.  Of course, not suggesting that these are mutually exclusive objectives for China to pursue.

Everything has so many facets, doesn't it? You can be completely wrong and make money and completely right and get shafted if the market disagrees. Or you can think you know why something is happening and yet it may be happening for reasons not known to you. 

Anyway, I think my hypothesis is fair enough, it may even be blindingly obvious, and so silly to refer to it as "my hypothesis" but whether it follows that the consequences are better zinc prices remains to be seen. 

I would be happier to get some PEM under 30 cents, so I might wait until the late afternoon tomorrow to see if I can get them from the profit-takers who have no reason to hold over the weekend  - in case the DOW does something really ugly on Friday night.   

Lots of getting out on each Friday given the volatility at the moment and the run having gone for a while now.  You would hate to see a sudden five hundred point fall and the PEM price 17 cents next Monday. (No points deducted for a bit of self-serving scare-mongering there, I hope)

Otherwise, i might keep my powder dry and see what transpires next week.

Another thing I am struggling to learn is not to be always rushing in like a cat crossing a road, all anxious dithering followed by an arbitrary sprint.  Not that a bit of caution really compensates for my lack of real financial insight regarding the "real" value of particular companies and whether it is already fully realised in the SP.  

This ultimately makes my buying pretty much arbitrary, certainly with regard to the important timing element, but I guess the whole market suffers a bit from the arbitrary nature of things.  With zinc, at least there are broader factors that I can have a think about and an an easy to understand primary factor - the price of zinc today and what the futures market can tell you about the price next month.


cheers


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## Boggo (17 April 2009)

From a charting view it had "look at me" written all over it on the 9th when it closed on its high and was poised for a break.

[I hold at 22c]

(click to expand)


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## misterS (17 April 2009)

Hi Boggo - Perhaps that illustrates how a picture is worth a 1000 words.  As I'm stuck with the 1000 word, rambling, inconclusive narrative, and am considering buying today, is there any chance of sharing the message delivered by today's chart, with particular reference to whether it is still saying "look at me", or has it come over all self-concious?


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## Boggo (17 April 2009)

misterS said:


> Hi Boggo - Perhaps that illustrates how a picture is worth a 1000 words.  As I'm stuck with the 1000 word, rambling, inconclusive narrative, and am considering buying today, is there any chance of sharing the message delivered by today's chart, with particular reference to whether it is still saying "look at me", or has it come over all self-concious?




Still seems to be interest in it but that is not a recommendation by any means.

Re the 1000 words, I find the pattern first in a Metastock scan, then look at the results on a blank chart, only if it comes down to the need to find the most likely from four or five do I consider looking for news/rumour etc.
Whole process takes twenty to thirty minutes.

PEM type patterns have been the performers over the last few weeks, not using targets, just trailing stops at a safe distance after I achieve break even.

Cheers


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## oremo (4 May 2009)

Hi MisterS & Boggo

Thanks for your replies to this post. I didn't exactly rush out and buy more shares in PEM but your points of view helped me stay in. I needed to hear what you guys had to say. 

MisterS thanks for your ramble. it was informative and well thought out. generous.

Boggo, thanks for your short, sweet, to the point feedback.

PEM has rallied nicely now. I siverely hope you guys hopped on.

Even though I was beginning to doubt the faith in my own belief it has been now been restored. 

"Do I take the money and run?" "Will they profit-take?" Those are the thoughts going through my mind right now.

I'm also thinking that my in-depth study of the zinc situation indicates that this is just the beginning of the stockpiling going on. 

The buying of zinc reminds me of my shopping expedition on Saturday where I found my favourite spaghetti was on sale at 67 cents as opposed to the usual $1.12. I thought I'd top up my pantry at the great price given I will continue to eat spaghetti for a long time to come.

Do you share the same opinion that the price will continue to rise back to "normal" consumption?

I'd love to hear from you guys.

Cheers

oremo


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## misterS (4 May 2009)

Hi Oremo,

Glad to see you are further in front.  Sadly, I am unable to translate my general surmising into timing sensible buying and selling, so wouldn't pretend that my advice on that would be any good. 

That said, on general principles, it seems a bit of a retrace tends to follow a couple of  large percentage rises and actually taking a nice profit is always gratifying.

Maybe depends if you are eyeing anything else in the market, or would just like to briefly "short it" by selling in the hope or expectation that it will at least retrace a bit during the course of a couple of days trading, allowing you back in a bit cheaper than your sale price?

Perilya responded quite adroitly to the zinc price crash and their new majority holder has funds and is itself also part of the zinc market.  Perilya production costs of about 52c a lb was re-assuring, but I think there was reference somewhere to a few cents of other costs to be counted also?

If the zinc price reversion to cost + hovers around 60cents, then that should see them do alright, even if prices do not recover very much.  The brief 70cents last week would look pretty good, so in the medium term it looks reasonable to hold, if that is what you decide to do.

It made me feel suddenly very nervous to see drawdowns and falling prices at the same time during last week.  In fact, and this should serve to ensure you are not confusing my ability to string a few thoughts together with any sort of trading nous, let me emphasise my general trading stupidity (should have put this on the losers thread) by telling you I bought some PEM for 31.5 cents after waxing on about zinc on this thread and then panicked and sold them for 25 cents _three days later _when I misinterpreted the falling zinc stocks plus falling price as the harbinger of another market armeggedon...you can see what happened next.

My only thin excuse is swearing to stop losses "this time" before they get out of hand and just cop the consequences on the chin. 

The only saving grace of the whole embarrassing affair was buying some PDN at 3.88 the day after, which thankfully compensated somewhat (though not entirely).

Anyway, "loser" confession out of the way, if the forecast of around 260k tonnes surplus for 2009 gets reported as diminishing in any major chunks over the next few months, that might suggest that the supply dislocation caused by the price crash was having at least a temporary ongoing effect.

It is the fact that the base metals price is probably going to continue to be volatile that would make me lean towards taking the money and running, but not running very far...and then running back.   (Kind of the opposite of how I often find myself trading...losing money quickly and running away and then running back later, cursing).

Hopefully PDN will fully reimburse my stupidity tax, and then I might come back and have a more considered look at PEM.

cheers


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## CAB SAV (4 May 2009)

Mate travelling through Broken Hill last Monday was told by a local that PEM was going to put on up to 120 workers. 
Funny how PEM & CBH both ended up 34% today.


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## MACCA350 (4 May 2009)

I baught in Thursday at 0.305, would have been nice to have picked it up around the 12c lows 

cheers


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## MACCA350 (5 May 2009)

Looks like PEM will open at 49c that's 12% up from yesterdays close with buyers eating up 10 levels of sellers........looks like we may crack 50c today

cheers


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## tech/a (5 May 2009)

Excellent been pyramiding into these for a couple of days.

Time to get out now everyone wants them!


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## tech/a (5 May 2009)

That was enjoyable.
One to keep on the watchlist.
Small miners have been good lately.
I'm filling up space with idle rubbish.


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## adds (31 May 2009)

Hello PEM followers, looks like PEM is primed for another break up as its formed an ascending triangle on low volume. Would be interested to hear what others think of this?

I wont upload the chart again so view chart here https://www.aussiestockforums.com/forums/attachment.php?attachmentid=30674&d=1243758894 posted on potential breakouts thread.


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## legs (3 June 2009)

It did this:

Volume was big and lets see where it goes, maybe it will continue today.. currently up 4.17%


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## adds (3 June 2009)

Yep broke out yesterday, that's when I got aboard. Lets see how it continues.


hmmmm... post not long enough to submit. Who's with me on PEM! Go PEM  lol.


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## legs (27 July 2009)

Statement today after the close made by Perilya:


"QUARTERLY ACTIVITIES REPORT FOR THE THREE MONTHS ENDED 30 JUNE 2009

The three months ended 30 June 2009 represented a consolidation of the new operating plan at Broken Hill, which has resulted in a vastly improved performance over the corresponding period last financial year. This improved performance under the new operating plan coupled with the post end of quarter termination of Perilya's silver sale arrangements has helped build a platform for Perilya to now pursue new growth opportunities."


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## GREENS (27 November 2009)

Given I have been so critical of Perilya before, it looks like CEO Paul Arndt has really turned the company’s fortunes around. Cash costs have fallen from >$1 to <$0.40 over the past 12 months. Margins are quite healthy and there seems to be plenty of upside with the Mount Oxide copper/cobalt project turning into a fairly decent deposit with more drilling to come. Very impressed with the turn around, I thought this was pretty much dead and buried a year back. Maybe they should takeover CBH’s Broken Hill assets and do the same. Would be a very profitable venture if they could do the same and increase the scale. Also given that cash costs were $0.38/lb of zinc even though there was a 9 day power outage is even more impressive. 

Negatives seem to be the dilution that occurred when the Chinese bought a 50% stake and the heavy reliance on lead (i.e. both price and production rates) as by product credits and its effect on cash costs. Direct costs are still very high. So any correction in the price of lead will likely have a considerable effect on cash costs. May be one to keep an eye on for directing some spec money if base metals continue to improve.


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## djones (20 September 2010)

Does anyone know the charts on this one?? Any chance of a breakout if heading over 50cents?


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## djones (23 September 2010)

"Last night Broken Hill City Council Held an extraordinary meeting Re: Heavy vehicle bypass around Broken Hill this is great news to PEM as it opens up a trucking route for the Potosi/Silver peak , The North Mine & the Flying Doctor open cut mines to deliver ore to the mill at the southern operations."
Quote from Hotcopper.


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## djones (7 October 2010)

TRADING HALT - ACQUISITION

http://www.canadianbusiness.com/markets/headline_news/article.jsp?content=b4760676

TORONTO - GlobeStar Mining Corp. (TSX:GMI) said Wednesday it has signed a deal to be bought by Perilya Ltd. in a deal that values the company at $221 million.

Perilya, an Australian company, has offered $1.65 per common share in cash.

GlobeStar shares closed up two cents at $1.27 on the Toronto Stock Exchange.

The deal requires approval by at least two-thirds of GlobeStar shareholders.

Perilya is the operator of the Broken Hill zinc, lead, silver mine in New South Wales, Australia, and the Beltana zinc mine in South Australia.

China's third largest zinc producer, Shenzhen Zhongjin Lingnan Nonfemet Co. Ltd, holds a 52 per cent stake in the company.

GlobeStar owns the Cerro de Maimon mine in the Dominican Republic.


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## noie (7 October 2010)

That is very interesting, Zinc and Silver at home now Copper and Gold overseas.
if they can work the rest of globestars plot then things could be even more interesting.


Cerro de MaimÃ³n, a copper/gold deposit in the Dominican Republic, is GlobeStar’s primary operation. Cerro de MaimÃ³n hosts approximately 6 million tonnes of open-pit copper/gold reserves, as reported in a National Instrument 43-101 compliant technical report dated August 2007 by independent consultants. The Cerro de MaimÃ³n property, and surrounding 3,391 hectare exploitation concession, was acquired from Falconbridge Dominicana (Falcondo) in April 2002. Falcondo retained a 2% NSR of which GlobeStar purchased 50% in 2008. The company owns 100% of the deposit, subject to the remaining 1% NSR retained by Falcondo. The Dominican Secretary of State of Environment and Natural Resources granted the Environmental License to GlobeStar to mine the Cerro de MaimÃ³n mineral deposit in 2004.

There is potential for expanding the reserve base of the operation from satellite deposits in GlobeStar's 100% owned MaimÃ³n Concession surrounding the Cerro de MaimÃ³n deposit. The MaimÃ³n Concession covers approximately 85% of the MaimÃ³n massive sulphide belt


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## djones (11 October 2010)

PEM powering up to 55.5cents today after a great day Friday!

Can anyone post a chart??


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## Boggo (11 October 2010)

PEM was one of just three stocks that came up on both my daily and weekly scan of the S&P ASX300.

Two horizontal lines will display resistance.

(click to expand)


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## djones (12 October 2010)

How is it looking after todays trade Boggo?? Bullish or Bearish?? I am purely into fundamentals but are trying to get a grasp on charting as well!


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## Boggo (12 October 2010)

You may get some support now in that area of former resistance.

Some great performers in the ASX 300 in the lower price ranges at the moment.

(click to expand)


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## G Gekko (30 April 2013)

PEM hasn't been posted about a lot lately. At 15c a share I think it's a steal. They are still making a strong profit despite a downgrade on last year and if past performance is anything to judge seem well positioned to rise in the future. I consider them fundamentally undervalued by a negative market on commodity exposed companies.

On these notes, I placed an order for 6,250 shares with a limit of 16c. I don't paying a little bit more than the closing price because I view getting in on this stock a good opportunity.


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## mim168 (17 June 2013)

is PEM a sinking ship??


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## oldblue (18 June 2013)

They certainly have their problems but it would be premature to write them off, IMO. It may be some time before lead, zinc, silver prices rebound to better levels but meanwhile the lower AUD is working in PEM's favour. I'm keeping it on  my watchlist.


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## UMike (5 September 2013)

TO for PEM?????

Zhongjin Lingnan Proposal to acquire Perilya at $0.35/share 
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01440798

Currently trading 31.5c, 3.5c discount to the TO price. Doubts about it's success?


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## System (22 December 2013)

On December 19th, 2013, Perilya Limited (PEM) was removed from the ASX's official list following completion of the Scheme of Arrangement with Zhongjin Lingnan Mining (HK) Company Limited.


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## UMike (23 December 2013)

System said:


> On December 19th, 2013, Perilya Limited (PEM) was removed from the ASX's official list following completion of the Scheme of Arrangement with Zhongjin Lingnan Mining (HK) Company Limited.




Yep.....

Got the cheque Friday.


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