AAM - A1 Minerals

[AngusSmart]

Looking good so far kicking myself for not spending a little more on it now since i didnt quiet spend all i was planning to on my holiday..

 

[Pivotonian]

First pour announced today - finally!

Still to be seen what impact it will have on the SP as its still in a halt. Hoping for some appreciation next week ...

 

[condog]

This is an absolutely amazing result to make the progression to producer. Overdue and small pour, but extremely powerful benchmark for the company.

Dont uner estimate the gravity of this moment for AAM. Irrespective of what the sp does, this is a massive achievement and one that the vast majority of gold explorers in this country ever fail to achieve.

I only wish i had a lot more of AAM

 

[AngusSmart]

This is an absolutely amazing result to make the progression to producer. Overdue and small pour, but extremely powerful benchmark for the company.

Dont uner estimate the gravity of this moment for AAM. Irrespective of what the sp does, this is a massive achievement and one that the vast majority of gold explorers in this country ever fail to achieve.

I only wish i had a lot more of AAM

you and me both man! @ .28 when i got in was so good! but i needed 1400 to go heli skiing in Alaska.. only to find the day we book it gets put on hold most of the day and than canceled.. would have added a fair bit more to the bunch i'm already holding.

cant wait till monday now!

 

[condog]

Should be a big week for AAM, depending on the post cap raising churn. apparently the cap rasing was done by Pattersons and had to be scaled back to 25% of application qty, due to massive demand. Gee i wonder why at 25c mates rates.

None the less should be a massive time ahead for AAM now that it is officially a Gold producer. A significant achievement that most goldies fail to ever attain.

Congrats to all holders.

 

[condog]

Announcment Friday During Trading Halt - expect market to react on open tommorrow.

Highlights
A1 Minerals completes first gold pour from BrightStar Project near Laverton in Western Australia, producing a 7.99kg unrefined gold bar.
Targeting production of 30,000oz per annum based on the plant’s current capacity of 300,000 tonnes per annum.
Exploration programme continuing to convert reserves and underpin future expansion
Western Australian gold company, A1 Minerals Ltd (ASX: AAM) has celebrated its transition into production with the completion of the Company’s first gold pour, comprising a 7.99kg unrefined gold bar, from the BrightStar Gold Project in the Laverton region of Western Australia.
The pour represents a major milestone for A1 Minerals, propelling the Company into the ranks of Australia’s gold producers and marking commissioning at the Company’s fully‐owned gold plant. The plant has initial production capacity of 300,000 tonnes per annum, but has been designed to allow a ramp up to 750,000tpa for an estimated cost of $10M.
The BrightStar Project has a JORC compliant resource estimate of 1.7 million ounces of gold, including a reserve of 150,000 ounces (ASX 1 December 2009). A1 Minerals is targeting minimum gold production of 30,000 ounces per annum for four years, with an exploration programme underway to expand the production output.
Recent exploration activities have suggested significant additional gold mineralisation, including the identification of large zones of near‐surface mineralisation within 400m of the plant where assay results have returned grades of up to 6m at 63g/t Au.
Page 2
Managing Director of A1 Minerals, Mr John Williams, said that the conversion of additional reserves would be a key focus in the months ahead.
“I would like to congratulate all our staff and contractors who have worked so hard to achieve this significant milestone of pouring our first gold from BrightStar,” he said. “With production now underway, our core aim at A1 Minerals will be to convert resources to reserves and define additional JORC resources to underpin the Company’s growth into the future.”
John Williams
Managing Director – A1 Minerals Limited
For full reports and information go to A1 Minerals website: www.a1minerals.com.au or ASX Code: AAM

 

[AngusSmart]

Hope today goes well..

does anyone happen to know an other Asx gold company that has a similar production rate and is currently producing also? would like to gauge a price of where this is expected to head.. if that would be any indication on where it is to go..

Cheers and thanks for the original heads up on this company..

 

[tja125]

Hey guys,

Well it seems the market didn't react that well to the capital raising.

Please offer me some insight or correct me, but i did some quick calculations to workout what the price should be after the shares are diluted with the cheap 25c shares and my answers left me thinking the price should still be around .32 (assuming the price of .33 at the time of the announcement).

Why such a bad reaction? Expecially given that it was also at a time of another positive announcement?

 

[condog]

Hey guys,

Well it seems the market didn't react that well to the capital raising.

Please offer me some insight or correct me, but i did some quick calculations to workout what the price should be after the shares are diluted with the cheap 25c shares and my answers left me thinking the price should still be around .32 (assuming the price of .33 at the time of the announcement).

Why such a bad reaction? Expecially given that it was also at a time of another positive announcement?

Not so much that it reacted badly, more of a case , theres 17 million shares just bought for 25c that can attain around a 15% return in 3days. And theyhave chosen to offload them.

Certainly the market hasnt reacted as strong as it should have and probably will once some of the discount shares are offloaded.

 

[tja125]

Not so much that it reacted badly, more of a case , theres 17 million shares just bought for 25c that can attain around a 15% return in 3days. And theyhave chosen to offload them.

Certainly the market hasnt reacted as strong as it should have and probably will once some of the discount shares are offloaded.

I see. Maybe I misread the accouncement, i thought it was saying that they will place the shares, not that they have already done so. I understand now that there are about 15.6 million shares given out in the last few days @ 25c and the rest will await approval form shareholders?, Well lets hope things go a little better once these guys have finished making a quick buck out of their mates

Thanks for your reply condog!

 

[McCoy Pauley]

The announcement clearly talks in the past tense (ie., the placement has already been made). Not surprised to see the SP sink on the back of that announcement.

 

[kermit345]

Disapointing that a raising is made with institutional and sophisticated investors at such a massive discount only to dilute the current shareholders positions, as well as have them simply sell on market straight away for such a large premium that they have recieved for simply taking part.

This is what can be disapointing about companies sometimes, the smaller investors get shafted by 1) not getting the opportunity to participate and 2) getting their holdings diluted by the large discounts to the 'sophisticated investors'.

What makes it worse is the timing of this announcement. I still believe the share price is undervalued and has some way to go as gold production continues and exploration is ramped up (as well as the possibility of production expansion). Unfortunately i'm having mixed feelings with the management after initially being very happy, hopefully from here on out there are minimal hiccups and a lot more positives.

 

[Sean K]

The capital raising at such a steep discount has potentially effected the share price reaction to the first gold pour, but really, those expecting a significant spike in the price on telegraphed news need to check themselves.

And those selling are likely not to be the sophisticated and institutions as they would have made some agreements not to sell for a certain period. I stand to be corrected on the mechanisms put in place for such processes.

As far as a good placement, what were these jokers smoking when locking in 25c? The VWAP over the past 3 months has been well above 30c and possibly around 35c. Major shareholder dilution and a indication of the markets willingness to hand out money to AAM at this stage. ie, not much.

Having said that, I think holding above major support at 30c is a very good outcome here. Could have just as easily tanked down to 25c.

 

[kermit345]

True kennas, I guess it does display the confidence in A1 that the share price hasn't fallen to the 25c mark and that shareholders are comfortable to retain their holdings in expectation of future performance.

A positive to take from this is that 4.3 mill was raised and it is to be used on 'working capital' which I assume includes keeping production happening so that a sustainable revenue stream starts occuring as well as some site drilling to *hopefully* increase reserves.

This is the vibe im getting from their recent announcements and plans for the mine/site.

 

[condog]

The raising was done by Pattersons and was 4 times over subscribed, surprise surprise, who wouldnt.

The dilution itself isonly around 1.4cents which does then set us up very nicely for accellerated growth in coming months, so its not all bad news. Its a shame it came on top of the maiden gold pour. Thats the dirty part.

The step from explorer to producer should have easily launched it past 40 c given its psent much of recnet months in the 30c+ and up around 37 c for some time.

Dumb, bumb, bumb is the only way to describe this move by an otherwise brilliant small company.

who ever they recieved advice to do the cap raising off needs to have their AFSL revoked.

 

[Sean K]

The dilution itself isonly around 1.4cents which does then set us up very nicely for accellerated growth in coming months, so its not all bad news. Its a shame it came on top of the maiden gold pour. Thats the dirty part.

The step from explorer to producer should have easily launched it past 40 c given its psent much of recnet months in the 30c+ and up around 37 c for some time.

Yes, not too much dilution, but after having more of a think about it, I wonder why they didn't tap the players for even more cash while they could? 4 times oversubscribed... Maybe another $5m in the bank would have been a good thing. At 35c, of course.

Yes, big step, but we'll never know what effect it would have had on the sp due to the surprise raising at bargain level.

Now, they need to prove consistant production to get that 30m oz pa. Still very very junior just to be running for 30m ounces. They should be fast tracking the ramp up I reckon. I suppose once they prove themselves here, they might do it. Will be interesting to see what their cash costs end up being for this initial period.

 

[kermit345]

I would hope that they make a habit of some regular announcements over the next 1-2 months to keep everyone up to date given the poor correspondence recently and the shareholder disfaction from this recent event.

would be good to have some ongoing reports on how the facility is functioning and what tasks they are undertaking with the new cash at hand.

 

[condog]

I would hope that they make a habit of some regular announcements over the next 1-2 months to keep everyone up to date given the poor correspondence recently and the shareholder disfaction from this recent event.

would be good to have some ongoing reports on how the facility is functioning and what tasks they are undertaking with the new cash at hand.

Im pretty sure we will see a better communication process, i certainly told them what i thought and it appeared i wasnt the first or last in line.

They will be drilling the nearby pits so we should be seeing assays, but a second pour for me will be the deciding factor.

At 30K oz we should be looking to see 80kg. It will take a while for them to reach that point due to technical refining etc, but i want to see a second pour of at least 40kg plus by approx 30 days from now.

 

[Sean K]

At 30K oz we should be looking to see 80kg. It will take a while for them to reach that point due to technical refining etc, but i want to see a second pour of at least 40kg plus by approx 30 days from now.

condog, what are you working on to try and get these figures?

Monthly rates of production I assume...

30k oz pa = 850kg pa

= 70.8kg p/mth

Not much difference I suppose.

And, why have you plucked 40kg? Just an assumed ramp up rate? Maybe we should be aware that if they keep 'ramping up' over the coming months, they will not make the 30k pa as you expect in first year, unless they overcook the mill in the later months.

 

[condog]

condog, what are you working on to try and get these figures?

Monthly rates of production I assume...

30k oz pa = 850kg pa

= 70.8kg p/mth

Not much difference I suppose.

And, why have you plucked 40kg? Just an assumed ramp up rate? Maybe we should be aware that if they keep 'ramping up' over the coming months, they will not make the 30k pa as you expect in first year, unless they overcook the mill in the later months.

Using troy ounces. i picked 40kg, assuming they will take time to rectify teething problems and ramp upr production processes and efficiencies.