# Cashed up companies



## nioka (10 April 2008)

In times like this it makes sense to invest in companies that are cashed up and avoid those with high debt. Would anyone care to mention any Company that is cashed up. ZFX and MCR are two I am looking at now. There must be plenty more.


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## JTLP (10 April 2008)

Nioka, although they are not cashed up to the max, they have ZERO debt, and fund all drilling and exploration via profits...the minnow i am referring to is...

CVN


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## Joe Blow (10 April 2008)

JTLP said:


> Nioka, although they are not cashed up to the max, they have ZERO debt, and fund all drilling and exploration via profits...the minnow i am referring to is...
> 
> CVN




JTLP,

That's not what Nioka was asking is it? According to their most recent half year accounts CVN had less than $4.4 million in cash as of December 31, 2007. That's hardly "cashed up".

Nioka, perhaps you should define what you consider to be "cashed up" as it seems that some will find any excuse to turn a thread like this into an opportunity to ramp.


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## YOUNG_TRADER (10 April 2008)

Also alot of cashed up companies have the cash pegged for the development of projects ie AIM has $80m in cash but it needs it all (+ more) to develop Perkoa, so maybe that needs to be a factor too, ie has the cash been set aside for anything?


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## nioka (10 April 2008)

Joe Blow said:


> JTLP,
> Nioka, perhaps you should define what you consider to be "cashed up" as it seems that some will find any excuse to turn a thread like this into an opportunity to ramp.




I consider a company cashed up if it has:
 1. Sufficient cash on hand to finance it"s promoted projects without the need for future fund raising and available for dividend payment. ( an example would be MCR) 
 2. Surplus funds which are available for share buy back or aquisitions ( an example would be ZFX)
 3. A prospecting Company that has sufficient funds to carry out their intended program. ( an example would be NWR.)
 This is how I see those companies (but I'm not always right.)


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## nioka (10 April 2008)

YOUNG_TRADER said:


> Also alot of cashed up companies have the cash pegged for the development of projects ie AIM has $80m in cash but it needs it all (+ more) to develop Perkoa, so maybe that needs to be a factor too, ie has the cash been set aside for anything?



 Even though they have cash on hand I don't consider them as cashed up. They don't have the cash on hand to complete their project.


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## james99 (10 April 2008)

nioka said:


> I consider a company cashed up if it has:
> 1. Sufficient cash on hand to finance it"s promoted projects without the need for future fund raising and available for dividend payment. ( an example would be MCR)
> 2. Surplus funds which are available for share buy back or aquisitions ( an example would be ZFX)
> 3. A prospecting Company that has sufficient funds to carry out their intended program. ( an example would be NWR.)
> This is how I see those companies (but I'm not always right.)




Nioka

I agree with investing in well funded companies in tough times and am doing so. But I think that the proposed criteria are quite problematic and looking at cash is quite a blunt instrument. A few examples only:

1. quite a few (small cap) companies have sufficient funds for 12- 18mths or so of exploration projects, but cannot then move to production without further cash;
2. some companies (even small cap), have shareholdings in listed co's which are essentially cash equalivents;
3. if some co's, with cash, do not obtain consents for, eg uranium extraction, then their value is essentially NTA only;
4. some co's have been very good at marketing (and hence raising cash from share issues etc) but have managment that is not very reliable at turning that cash into viable investments.

In a tough market, don't we also need to look at, eg, income stream, management, geopolitical risk, supporting brokers. 

I am sure that you are aware of all of these and more, and simply wish to express the view that a "cash" analysis is not, in my view, likely sufficient to mean that a stock is good.


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## So_Cynical (10 April 2008)

I wonder if *TRY* - Troy resources, qualifies as being "cashed up" considering there junior status.

Company Summary
Market Cap:	181,517,785
Issued Shares:	69,814,533

A$22M cash balance as at 31 March, 2008
Adelaide resources (ADN-ASX) -14.2% equity
Birim Goldfields (BGI-TSX) -7.4% equity
100% unhedged - 100% debt free
Andorinhas project (Brazil) 50.000 Oz Gold per annum...in production
No large developments planned or underway...only exploration Drilling


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## JTLP (10 April 2008)

Sorry Joe...wasn't really going for the ramp, just being cheeky :

My bad


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## nioka (10 April 2008)

james99 said:


> Nioka
> 
> I agree with investing in well funded companies in tough times and am doing so. But I think that the proposed criteria are quite problematic and looking at cash is quite a blunt instrument. A few examples only:
> 
> ...



 I agree 100%. Cash is not King on it's own but you would have to agree that those companies with cash on hand are in a better position than those that have to borrow or service borrowing in the current trading conditions


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## gfresh (10 April 2008)

CBH also has/had approx $200m cash at last quarterly. Not sure how you'd assess now with the PEM merger, but anyhow..

For explorers, some in which I have an interest.. 

TLM has $10m in cash as at last half-year, and embarking on an extensive iron ore drilling program in the Pilbara. I believe they have plenty of cash to achieve their drilling objectives over the next 12 months without further capital raising. Market cap = $42m.. high cash/shareholder equity position. 

MAR has approx $7m in cash as of last half-yearly... currently drilling and evaluating opening of old Conrad Silver mine in NSW. Current market cap = $28m - high cash/shareholder equity position.

JMS has approx $5.8m in cash as of last half-yearly.. Various iron ore and other exploration targets. Market cap = $30m..


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## nioka (10 April 2008)

gfresh said:


> CBH also has/had approx $200m cash at last quarterly. Not sure how you'd assess now with the PEM merger, but anyhow..
> .



 Neither CBH or PEM appeal to me individually however if the merger is successful the merged unit could be a good one. I'd need to be convinced that they would be reliable where dividend payments were concerned. the record of CBH in that regard is not good.


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## intheblack (11 April 2008)

Since nobody's mentioned it yet, I'll suggest that SEV is still sitting on a huge pile of cash following its deal with KKR to sell half of its TV network.  Some of the cash has been invested in WAN and Unwired, but there's still got to be plenty left to collect interest.


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## nioka (11 April 2008)

Been watching that one. They are engaged in a share buy back at the moment and are only half way through the "allowed" amount. Even with the company actively buying it's own shares the SP is still at a year low. Why is it so? (as prof. Summner Miller used to say.) Their finances are hard to follow. They claim a $2.5 billion cash war chest yet Wectpac shows their market cap at less than that. I must do some more research. They are either a fantastic buy or something is wrong in the print.


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## nioka (11 April 2008)

intheblack said:


> Since nobody's mentioned it yet, I'll suggest that SEV is still sitting on a huge pile of cash following its deal with KKR to sell half of its TV network.  Some of the cash has been invested in WAN and Unwired, but there's still got to be plenty left to collect interest.



Decided that SEV does not qualify as "cashed" up for me. A cash war bag of $2.5billion is far outweighed by debts of over $4 billion. the $4billion+ figure may be out of date as it is taken from the last balance sheet available to me and the $2.5bln figure is from a news item.


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## Muschu (11 April 2008)

nioka said:


> In times like this it makes sense to invest in companies that are cashed up and avoid those with high debt. Would anyone care to mention any Company that is cashed up. ZFX and MCR are two I am looking at now. There must be plenty more.




Would NVT [currently into a buy-back] and AXO qualify?


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## doogie_goes_off (11 April 2008)

Cashed up miners: Holding MCR due to good cash and outlook from production. Others companies in my headlights are ZFX and ofcourse BHP, but I think there are a swag of "spec" juniors with no debt that have enough cash to get their projects to bankable feasability, these are my preferred targets due to the lower number of shares issued, which means they are "cashed up" relative to the number of shares ie: you get good equity in the short term with a medium term upside of resource increases. Not sure that cash is the be all and end all but it's easy to understand!


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## james99 (11 April 2008)

nioka said:


> I agree 100%. Cash is not King on it's own but you would have to agree that those companies with cash on hand are in a better position than those that have to borrow or service borrowing in the current trading conditions




Agreed. Regards.


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## jman2007 (13 April 2008)

nioka said:


> In times like this it makes sense to invest in companies that are cashed up and avoid those with high debt. Would anyone care to mention any Company that is cashed up. ZFX and MCR are two I am looking at now. There must be plenty more.




Crescent Gold CRE

AUS$ 85M in the bank, unique for the ASX

jman


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## rub92me (14 April 2008)

BDG - Gold explorer turned producer turned explorer again. Did their last big captial raising before the bottom fell out. Still plenty in the kitty to have another go if they prove up enough gold. They're treading very carefully though.

MEO - Also did a big capital raising and then had some disappointing drill results. Enough funds to have many more chances.

CQT - Lots of cash and lots of prospects. JV for gold with major South African gold company and hence reduced exploration expense.

TAP - Cashed up oiler; still waiting to prove up a company maker/transformer and various promising prospects, including Brunei.


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## Markcoinoz (14 April 2008)

One that no one has mentioned is CFE.

MCC has secured an exclusive right (until 30th April) to conduct due diligence for the acquisition of the project.  MCC has paid a deposit of A$10mln to CFE with A$5mln being non-refundable.

MCC to pay CFE in 3 Tranches

$240mln end of April 
$ 80mln 60 days after settlement
$ 80mln on the grant of a mining lease.

Therefore they should receive A$320mln within 60 days of settlement.

One would expect CFE to then decide to do some shopping for bargains.

Cheers markcoinoz


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## wipz (15 April 2008)

SEA - Sundance Energy Australia Limited.

$52.2 Million cash at bank, current market cap of 56million.

Only bad thing is opes prime holds 12% =[
Could be a good one to watch and pick up cheap once sold off.
Cheers


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## bas (17 April 2008)

UEQ- $18M in bank at last quarterly?


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## niknah (17 April 2008)

OSH, US$344m cash.


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## nioka (17 April 2008)

Markcoinoz said:


> One that no one has mentioned is CFE.
> 
> MCC has secured an exclusive right (until 30th April) to conduct due diligence for the acquisition of the project.  MCC has paid a deposit of A$10mln to CFE with A$5mln being non-refundable.
> 
> ...




 I like this one. It will be well cashed up if the deal goes through and if the deal falls over it could still be a good proposition. I like the management. I became interested when I realised that Ian Burston had become Chairman. I hold a few CFE and hope that I can soon note that it is well cashed up.


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