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CMM - Capricorn Metals

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CMM went through a 5 to 1 share consolidation in late 2019, but even taking that into account it has done very well since my last post in this thread back in June 2019.

CMM share price is up 10.6% today and is currently $2.03 (pre-consolidation price of around 40c) after the company announced that it has acquired the 2,083,000 ounce Mt Gibson Gold Project for approximately $20/oz.

I haven't dug into the details yet, but CMM looks to be going from strength to strength.
 
Never hear about these guys... Also, I probably spoke to soon when I said I never see cash balance waterfall charts anymore...
  • $1.3 billion market cap at $3.50 share price
  • $50 million debt (paid $15m last quarter)
  • 31,000oz produced for the quarter @ $1,166/oz AISC
  • Now taking the total cash outflows of ~ $58m/31koz I get just under $1,900/oz of cash being spent (ignoring debt repayment) which roughly equates to about $20m of quarterly "free" cashflow - Not too dissimilar to GOR which has a similar valuation but also has a much higher net asset value ($720m vs about $250m for CMM)
Not a bad quarter, but certainly not a cheap valuation in my mind. Why is it that WA gold miners command such a high premium in the market?

 
Good morning
CMM gone to the moon after revealing its mineral resource estimate increased by 32 per cent to 2.75m ounces from 2.08m ounces.


Kind regards
rcw1
 
Good morning
Capricorn Metals Limited has advise that it has reduced its gold hedge book by 51,000 ounces to provide further exposure to any increase in the A$ gold price over the next 15 months. Nice one sunshine Lolly pops...

Holding

Have a very nice day, today.

Kind regards
rcw1
 

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  • Partial-Closure-of-Hedge-Book-Gives-CMM-Gold-Price-Upside.PDF
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Yes, its hard to invest in a gol stock that has a PE in excess of 18, I think its at best fully valued, if not overvalued for my liking.
I like gold and gold producers, but not at some of the prices offered in OZ.
mick
 
Good morning/afternoon @DrBourse
Hope your boat cruise is going well.

Should you have an opportunity, would much appreciate if you would place your TA ruler across this one for rcw1 please.

Kind regards
rcw1
 
rcw1 said:
Good morning/afternoon @DrBourse
Hope your boat cruise is going well.

Should you have an opportunity, would much appreciate if you would place your TA ruler across this one for rcw1 please.

Kind regards
rcw1
Click to expand...
Hi rcw...
Sorry M8, cannot help you atm as I do not have have access to my PC or my Spreadsheet Calculators to do an indepth analysis...
..
Cheers,
DrB
 
"The latest victim of nature's fury is Capricorn Metals' (ASX:CMM) Karlawinda gold mine, in the heart of the Pilbara. Facing its second deluge in less than three months, the company finds itself grappling with the consequences of Mother Nature's unpredictability.

Reporting to the ASX on Tuesday, Capricorn Metals revealed the toll exacted by the recent downpours. Despite enduring two substantial bouts of rainfall, the company maintains cautious optimism regarding its annual guidance for the fiscal year ending June. However, it concedes that meeting targets may necessitate operating at the lower end of the projected range, set at 115,000 to 125,000 ounces.

The impact of the inclement weather on open-cut operations at the Karlawinda site has been pronounced. With over 150 millimeters of rain inundating the area in recent days, the mine grapples with operational disruptions reminiscent of the deluge experienced two months prior, when 133 millimeters of rain fell within a couple of days.

These rain events have resulted in eight days of lost mining activities for CMM, significantly impeding progress at the site. The company's contracted mining partner, MACA, finds itself unable to meet the targeted material movements for the March quarter, further exacerbating operational challenges.

While the processing plant remains operational despite the rainfall, Capricorn Metals has been compelled to process lower-grade stockpiles due to the inability to access higher-grade ore in the open pit. In response, the company now shifts its focus towards maximizing the extraction of higher-grade ore until the conclusion of the fiscal year in June, aiming to bolster production amidst the setbacks.

The repercussions of these lost days are reflected in Capricorn's revised production estimates for the quarter, with expectations now hovering around 26,000 ounces of gold. Despite a promising performance in the preceding December half, where production surged to 60,099 ounces and sales increased by 7% to 60,341 ounces, the company acknowledges the formidable challenges posed by the prevailing weather conditions.

Moreover, the adverse weather conditions are anticipated to impact the company's all-in sustaining costs (AISC) for the first half of the fiscal year 2024, which stood at $1,324 per ounce. Capricorn Metals anticipates that the overall AISC for fiscal year 2024 will likely trend towards the upper end of the guidance range of $1,270 to $1,370 per ounce, primarily due to the reduced tonnage processed as a consequence of the weather-induced disruptions.

"As Western Australia's miners navigate the formidable challenges presented by nature's whims, Capricorn Metals' experience at the Karlawinda gold mine underscores the resilience and adaptability required to thrive in such volatile environments. As the company perseveres through the trials posed by the elements, it remains steadfast in its commitment to surmounting obstacles and delivering on its strategic objectives despite the odds.

- journalistic flourishes from Glen Dyer

EDIT : add graph
 
Last edited:
Good evening

An all-time high achieved today (03/04/24).
Have a very nice night.

Kind regards
rcw1

15 minute chart
 
Macquarie has downgraded its rating of Capricorn to an Underperform rating with a $4.80 price target after CMM lowered its full-year production guidance.
 
I have been patiently waiting for CMM to dip below 5 bucks for an entry.
Its nearly there.
Hopefully the pummeling of gold stocks continues to allow me a small wager.
Mick
 
From a livewire interview with fundies about sml/mid cap managers worth following, according to them.

Not Held

Capricorn Metals (ASX: CMM)​

Nathan Hughes: So I nominate Mark Clark of Capricorn, formerly Regis, and we knew him quite well through his Regis days. In the gold space, it's quite tricky. Capital allocation is difficult, and sadly, a lot of gold companies haven't shown a great track record of generating shareholder value and free cash flow. We like Mark because he's a pretty conservative guy. He has a bit of an under-promise, over-deliver culture. He's conservative in how he talks about reserves and resources. And traditionally, he hasn't overspent on CapEx or gold-plated, pardon the pun, some of the assets. So we just think he's been a really sensible allocator of capital, which actually is quite rare in the gold resource sector.
 
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