PRU - Perseus Mining

[Sean K]

Looks like this business in the Ivory Coast might be coming to a potential conclusion which should support PRU.

I am STILL very surprised that they are independent.

My recommendation to NCM is to take them over along with GRY, consolidate, and then spin off all their Africa assets into an independent company.

Could free up gazillions and make them much for focussed and agile.

 

[shag]

Looks like this business in the Ivory Coast might be coming to a potential conclusion which should support PRU.

I am STILL very surprised that they are independent.

My recommendation to NCM is to take them over along with GRY, consolidate, and then spin off all their Africa assets into an independent company.

Could free up gazillions and make them much for focussed and agile.

its like lihir imo, looked a great t/o target-i dont rate the volcanic risk(look at chch, we all knew the alpine fault was going to hammer chch n overdue, but yo behold an unknown series of faults RIGHT UNDER the very dilapidated peat bog, put the place where it belonged), but lihir sat untouched for years. you have to assume the volcanoe will too, well past the realistic minelife. if chch was lihir, ie a bussiness, sadly i doubt anyone would have bought it, as it was, considering its well known risk profile.

a cap. raising for the boys, and not for us was really impressive. gry's second raising in close proximity has only a pathetic token amount for us also.

 

[Ajax]

Re: PRU - Perseus Mining Resource Upgrade at Edikan Gold Mine Ghana

Announced after market close today. Great Xmas present for shareholders.

Almost 1 million more measured and indicated gold resource ounces in Ghana.

Takes total of reserves and measured and indicated reources and inferred resources across Ghana and Ivory Coast to almost 9 million ounces with more ounces to come for both (particularly Ivory Coast). Refer to chart on page 4 of the announcement...

http://www.stocknessmonster.com/news-item?S=PRU&E=ASX&N=572604

The next good news should be an announcement that commercial "name plate" production levels have been achieved for gold production at the Edikan Gold Mine (also this month)...foreshadowed by Mark Calderwood in November Boardroom Radio interview.

 

[Sean K]

Some good infill drill results late last week on both projects and under the existing JORCs. Will add some more ounces to the next upgrade I suspect and move some more to the M&I. On their way to 10m ounces which just seems inevitable at this rate. Mining seems to be going as planned. I wonder what can surprise from here? Lots of drill results outstanding, perhaps a super rich zone somewhere...

 

[Dreadweave]

Can someone tell me whats happened int he past few days with PRU? The gap then the sudden drop. any ideas ?

 

[skyQuake]

Can someone tell me whats happened int he past few days with PRU? The gap then the sudden drop. any ideas ?

Well gold has been getting smashed recently. Look at NCM OGC KCN AQG etc
A huge fall in gold wouldn't do these midcap goldies any good...

 

[Sean K]

Can someone tell me whats happened int he past few days with PRU? The gap then the sudden drop. any ideas ?

At the mercy of POG. All goldies will be effected if POG doesn't look to have further upside. Take you bet.

EW will tell you it's all in the waves. Haven't seen a POG one in a while. Not since Radge called a W5 top at about 700 bucks on TV. Haven't seen him on the airwaves since.

 

[Sean K]

PRU one of the few W African goldies flickering with a heart beat. Probably helps when you actually do as you forecast. Unlike the troubling situation with AZM who have delayed FS for months and months. GRY showing no signs of life either. I suppose they are still explorers but they really should have progressed much faster and stuck to the main task.

Next quarter PRU aiming for 50k oz at $600 an oz or so. Well on the way to 200k pa. Grades are pretty low at this stage but better than expected.

Perhaps once all the political and security issues look to be stabilized in the region this and all WA will be back in favour. However, this is Africa!

I wonder if anyone has run the ruler over these guys yet, since they can actually discover, develop and build mines to plan.... Maybe NCM will have a sniff. Or at least have a look to see how it's done!

 

[Sean K]

Well, after holding up OK and all fundamental points being covered they've been smashed like all others. $2.25 support looks critical.

The fundamental issues at play are probably POG which actually is still OK except for the potential of no more money printing, perhaps.

The next is the political situation in West Africa and the potential hikes in taxes and royalties back to governments. Word is they are going to go north considerably and the MD of PRU noted it recently as a significant risk to the business. Like a 10%+ change in taxes or something. Massive for a junior, although PRU is over that mark.

 

[Sean K]

Well, after holding up OK and all fundamental points being covered they've been smashed like all others. $2.25 support looks critical.

Seems to have hung on grimly to that support level. Bounced well. Will be interesting to see if they hit production forecast again. Quite an amazing story really. Getting into development on time, on budget, to forecast. What miner does that?

 

[prawn_86]

Quite an amazing story really. Getting into development on time, on budget, to forecast. What miner does that?

Yeh one of the few to move from exploration to production pretty much without a hitch.

out of interest, what margins are htey operating at and what is their current P/E?

 

[Sean K]

They just keep kicking goals this mob. Everything on schedule, meeting targets, making a killing at these gold prices. Shame about the hedging but a necessity. Will be nice once they pay that off, although they'll have to do the same for Sissingué I suppose. If the politics in W Africa smooth out and they don't decide to lift the tax rates too much as threatened then PRU is looking like a long term very good mid tier play. Until they get taken over.

June activity report out a couple of days ago:

• Record gold production of 52,670 oz during the June 2012 Quarter (the “Quarter”), 13,874 oz or 36% more than in the March 2012 Quarter (the “March Quarter”) and within production guidance of 50-55,000 oz for the Quarter;

• Cash costs reduced to US$676/oz, 7% lower than March Quarter cash costs and 2% lower than cost guidance;

• Total ore and waste movements (3.660Mbcm) ahead of targets;

• Head grade (1.6 g/t) and recovery (87.4%) ahead of targets;

• Hourly mill throughput rate (734tph) equates to annual throughput of 5.8Mt at 90% plant availability;

Development - Sissingué Gold Project - Côte d’Ivoire

• Negotiation of final fiscal terms for the Sissingué Gold Project is on hold pending formal granting of the Exploitation Licence.

• Tendering process for early development works and detailed plant design work well advanced. Exploration – Ghana and Côte d’Ivoire

• 63,025m of drilling completed including 13,447m in Ghana and 49,578m in Côte d’Ivoire.

• Significant drill intercepts from multiple deposits.

Corporate

• Available cash balance of A$105.5M plus 761 oz of gold on hand at 30 June 2012.

• Debt reduced to US$63M and associated hedging reduced to 190,000 oz at US$1,256/oz.

 

[shag]

They just keep kicking goals this mob. Everything on schedule, meeting targets, making a killing at these gold prices. Shame about the hedging but a necessity. Will be nice once they pay that off, although they'll have to do the same for Sissingué I suppose. If the politics in W Africa smooth out and they don't decide to lift the tax rates too much as threatened then PRU is looking like a long term very good mid tier play. Until they get taken over.

June activity report out a couple of days ago:

yes will be rolling in it once the hedge is off in a year or so
its a shame they couldnt roll the hedge to the next mine, tho i know litttle of hedging. assume its just an insurance policy to appease the banks.
must be slighly cheaper to build these mines now the non gold boom is slightly deheated.

 

[prawn_86]

Maiden profit of 50m reported today. More production coming online in 2013 and expecting to pay dividend in 2014

One of the few to successfully transition from explorer to profitable producer, in any commodity

 

[Sean K]

Maiden profit of 50m reported today. More production coming online in 2013 and expecting to pay dividend in 2014

One of the few to successfully transition from explorer to profitable producer, in any commodity

Yep, pretty impressive effort really.

I think the stock's discounted at the moment due to Ivory Coast troubles and the probably extended delay in Sissingue getting up.

 

[JTLP]

Maiden profit of 50m reported today. More production coming online in 2013 and expecting to pay dividend in 2014

One of the few to successfully transition from explorer to profitable producer, in any commodity

Spewing I missed out on this one back when it was a dollar! JMan (What happened to that guy - was a very informative poster) and I used to discuss this.

Can't believe they are expecting to pay a dividend in 2014 and bloody AQG can't nail anything

 

[jancha]

Maiden profit of 50m reported today. More production coming online in 2013 and expecting to pay dividend in 2014

One of the few to successfully transition from explorer to profitable producer, in any commodity

Interesting with POG in relationship to PRUs current price ($2.56)
As with most other Gold stocks if POG goes down so does the sp which is understandable.
However the POG has fallen in the past week 3-4% and yet PRUs sp has fallen something like 10%.
Yet back in June when the POG was in the low 1600s PRUs sp was $2.80.
Question is why should it's share price be 10% less now than when it was then when the POG was 1600?
As quoted above a sucessfull producer so one would assume that the drop is only due to the fall in Gold Price.
Please no Boogos need reply.

 

[jancha]

PRUs recent quarterly profit and loss shows a net profit for the first time since being in production and yet its sp continues to decline. ($2.48 down from $2.80 in 2 weeks) POG is still over 1700 an oz!
Interested to know what others thoughts are on this and if the major lawsuit in Africa over miners with Silicosis would have anything to do with it. I think the claim is only against Anglo Gold but dont know if this is affecting other mining companys in Africa as well. Thoughts on this?

 

[jancha]

PRUs recent quarterly profit and loss shows a net profit for the first time since being in production and yet its sp continues to decline. ($2.48 down from $2.80 in 2 weeks) POG is still over 1700 an oz!
Interested to know what others thoughts are on this and if the major lawsuit in Africa over miners with Silicosis would have anything to do with it. I think the claim is only against Anglo Gold but dont know if this is affecting other mining companys in Africa as well. Thoughts on this?

In answer to my own question: Gold was over $1700. Big drop over night saw it fall to $1678 but I think the African Goverment might have something to do with PRUs sp.
Perseus Mining has continued to prosper in the notoriously risky West African sector, passing the 12-month mark since it started production at its gold mine in Ghana.
The miner's latest production result showed gold production of 52,610 ounces for the September quarter, in line with the June quarter but four per cent under its forecast production range.

It blamed slightly lower grades while it faced mechanical problems with its primary crusher during the September quarter at its flagship Edikan mine in Ghana.

Perseus' shares were one cent lower at $2.76 on Tuesday.

The miner is an ASX100 company - with its market capitalisation climbing above $1.83 billion in September last year although its stock price has fallen 31 per cent since then.

It said on Tuesday that sales for the September quarter were 4.7 per cent down on the previous quarter, at 50,785 ounces, on a 2.7 per cent weaker gold price at $US1,463 a fine ounce.

Offsetting the lower numbers were lower cash costs of $US475 an ounce, 30 per cent lower than the previous quarter and 17 per cent lower than guidance, which it attributed to an accounting adjustment.

Perseus has been in production since August 2011.

Since then other West African gold explorers have struggled to bring projects into production as global economic uncertainty and political unrest in Africa has made investors more risk averse.

Perseus has put its second potential mine, the Sissingue gold project in Ivory Coast bordering Ghana, on hold because of the possibility of the government introducing a profit-sharing arrangement.

In Ghana, the government increased the corporate tax rate this year from 25 per cent to 35 per cent and is proposing an additional 10 per cent windfall profits tax.

 

[jancha]

This also is a worry: I find nine times out of ten when an analyst puts in a strong recommended buy for a company in this case PRU the share price usually heads in the opposite direction!



Equities researchers at Fraser Mackenzie began coverage on shares of Perseus Mining Limited (ASX: PRU) in a report issued on Friday. The firm set a “strong-buy” rating and a $3.40 (3 AUD) price target on the stock.

Perseus Mining Limited traded down 1.59% on Friday, hitting A$2.480. Perseus Mining Limited has a 1-year low of A$2.120 and a 1-year high of A$3.660. The company has a market cap of A$1.136 billion and a price-to-earnings ratio of 24.00.

Separately, analysts at Dundee Securities raised their price target on shares of Perseus Mining Limited from $4.00 to $4.40 in a research note to investors on Wednesday, October 3rd. They now have a “buy” rating on the stock.

Perseus Mining Limited (Perseus) is an Australia-based company. The Company is engaged in the mineral exploration, gold project evaluation and development, mine operations and the sale of gold in the Republics of Ghana and Cote d’Ivoire, in West Africa.