PEM - Perilya Limited

[aramis]

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]

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

 

[oldblue]

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]

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]

Stan 101

Good thoughts and thanks

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

At last CBH management read our stories and here u go

See the attachment of management changed and Stephen Dennis stepped into

 

[aramis]

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]

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]

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]

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.

 

[kkyyoo]

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]

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 )

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]

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

 

[kkyyoo]

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]

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]

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]

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]

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]

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

 

[prawn_86]

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]

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.