QOL - Queensland Ores

Doggie,

150K + 1 million shares is an absolute steel for those EPMS.

QOL strong today up 14 % to 16 cents

Jooooles, I wish I held those EPM's, maybe if they gave me 1 million shares their price would halve! instead of going up. The chances are that these shares will appreciate and Xtreme is now along for the ride, good on them I suppose. Maybe I didn't understand the diagram and maybe there should have been a new diagram to put it in context with the announcement. I am sick of companies that cannot clearly promote their projects to the market. I was buying QOL at 26c an hold because fundamentally I think they are worth more. A 10% of IGV figure would seee them well above where they are now but the market does not appreciate announcements without detail which still leaves them open to buying by astute investors such as yourself jooooles. If I were the directors I would be very nervous about potential for a hostile takeover, which would only be good for the share price longer term I suppose. Anyhow I reckon there will be a retrace because the real announcement will be plant commisioning IMHO. Good luck to all long term holders.

I don't think Friday's sharp rise was because of the announcement in relation to the EPMs. We already knew QOL had acquired the EPMs in October last year 5 months ago. Friday's announcements were just formalities. What’s disappointing is the DOW sharp fall Friday night which may impact the SP come Monday but I suspect many technical traders will jump on QOL next week too.

I think it is attracting interest from investors who can see the potential of the company and can see that it is clearly undervalued.

The company has reaffirmed that first shipments of concentrates will be in July this year on several occasions. Every update and announcement has included somewhere that "QOL is still on track for the sale of first concentrates in July". This means that the plant is to be commissioned next month in May. Potentially this is 30-45 days away. It is within budget and 85% complete.

Why wouldn't you look at getting in now when this company was trading as high as 49 cents even before it had EPA clearances and mining leases and there we so many unknowns. All of these unknowns have now gone. The only thing we need to know is the small about of coin they need to raise as working capital - as cash flow from the sales is 3 months down the track. BBY on board for that now much better to have them on board than the Far East Capital.

So much has happened since then and we find ourselves at 16.5 cents with a market cap of 21 million which does not reflect the value of this company in any shape or form.

Mt Cannindah has an in ground value of over US$750 million and by the sounds there’s a lot more. The cash in the bank and value of the plant and equipment alone is greater than the market cap - go figure.

This company has had a solid strategic plan right from the very start. Management have and continue to follow it through. The sales of concentrates will be used to fund an aggressive drilling campaign at Wolfram to extend the life of the mine. This is a win-win for shareholders as it stops further dilution. The plant was constructed to take 250 tpa. Its only initially going to operate at 150tpa until the resource is increased. The resource is based on some 20% of the “known” strike. Drilling outside the pit has yielded grades which are extremely similar to those inside the pit.

Yep,

Pretty much agree with that assessment joooles. Volume has been steadily building for 3 days now, and pressure from the buy side starting to have an effect. Perhaps QOL have not marketed this project to their fullest, but as July draws closer and closer and management continue to maintain they're on track for first concentrate shipping, the risk is diluting. Barring any negative news, such as delays in production or plant commssioning etc I can't see a major retrace on the cards, just my opinion though.

jman

The Wolfram update out this morning does a great job of explaining where everything is up to and also explaining the economics of their projects. A pretty impressive little release really, well worth a read. It's great to hold a small cap company that is so professional. Fills me with confidence.

Synergy said:

The Wolfram update out this morning does a great job of explaining where everything is up to and also explaining the economics of their projects. A pretty impressive little release really, well worth a read. It's great to hold a small cap company that is so professional. Fills me with confidence.

Click to expand...

Yeh i really like the way the have/are going about things.

They were relatively quiet over the last 6 - 8 months while they were focussed on making sure there were no problems with the mine etc, and now they are close to production they are ramping up the marketing.

Shows me 2 things:
Wolfram will be on time
They know the importance of marketing

Good stuff

Yep, buying pressure is definitely back now

Agreed, their marketing is fantastic. It reminds me a lot of Queensland Gas when they were still a sub 50c share. Straightforward and impressive without
bloating the company's prospects in anyway. Wouldn't it be nice if they did a Queensland Gas rise lol. I'm glad I picked up a parcel of these the other week at 15c. Will look to buy more soon, maybe even today The way I see it, Molybdenum will get hotter, copper and gold are obviously hot.. the company is still at a significant discount to its book value and the market hasn't really woken up to this share yet.... worth the risk IMO.

Interesting yesterday, there were a fair few late buyers, post 3pm.. and then the ann today...

Buyers withdrawing, sellers coming back now. Looks like another wander down is likely.

It's a patience-tester this one, no doubt. Plant commissioning can't come sooner, or too July. Hopefully, some love might stay with this stock after these milestones.

AnDy62 said:

Buyers withdrawing, sellers coming back now. Looks like another wander down is likely.

It's a patience-tester this one, no doubt. Plant commissioning can't come sooner, or too July. Hopefully, some love might stay with this stock after these milestones.

Click to expand...

Yeah it's a teaser for sure Andy,

Having difficulty breaking through 17c due to a steady stream of sellers coming out of the woodwork. These may be long-term holders of the stock who have finally lost patience, and are looking to come away with at least something. Imo, there really isn't all that much risk associated with this now, the only teething concern is the shrortfall in working capital, which could be solved with a new cap raising.

We need to just get through this tough little period, and arrive primed at the starting line in July.

jman

Plant starting producing May 15. See reuters http://money.www39.ninemsn.com.au/article.aspx?id=449666
First shipment July
Things are happening now.

Their March ann. said cash would run out in June but that various financing proposals were being looked at. I see debt more likely as its balance sheet is debt free.
Any capital raising would look better later as it would be perceived as relating solely to Cannidah and its latent value.

morton_mains said:

Plant starting producing May 15. See reuters http://money.www39.ninemsn.com.au/article.aspx?id=449666
First shipment July
Things are happening now.

Their March ann. said cash would run out in June but that various financing proposals were being looked at. I see debt more likely as its balance sheet is debt free.
Any capital raising would look better later as it would be perceived as relating solely to Cannidah and its latent value.

Click to expand...

Thanks for the article, good read. Interesting that China has already bought first year's production with option for next three years. Should have the cash flow coming in nicely with good prices for Moly and Tungsten.

For this first year's predicted production;

We have 200 tons of Moly at 50%
= 100 tons of Moly
= 2200lb (1t) * 100 * 33.50
= $7.4m
Profit = 7.4m - costs
= $5.2m (assuming costs of $10/lb which is the norm I believe)

That's for Moly alone (forget Tungsten and Mount Cannidah altogether)

And what is the market cap? At current prices 20m...

And this is not making figures up, this is the production which has already been bought by the Chinese firm. This couple of weeks might be a last chance to scoop up cheap stock before the anns roll in. I know I've built up a decent parcel

Try this for some better numbers:

A few facts (as taken from last presentation):

1. Annual production
60,000 mtus WO3 (now @ USD255/mtu)
250,000 lbs Mo (now at USD 33.4/lb)

Therefore annual revenue based on those numbers and prices and using AUD/USD of 0.93 (60000 x 255/0.93 + 250000 x 33.4 / 0.93)

= AUD25.4 million

2. Opex = ~AUD 75/tonne

Annual opex = 150,000 x 75 = AUD 11.25m

Annual Operating surplus (before yearly capex etc) = AUD 14.15m

Has anyone had contact with the company managment or BBY in regards to a date for an announcement on the future funding of the company???

benwex

So, trading halt... anyone have any ideas? Let's hope it's good news. It is a bit worrying that the share price went down on a pretty high volume the day before

Whoops, now I've read the trading halt ann properly, it is a capital raising

That's depressing, just when you thought the pain was almost over. Brilliant.

I hope the price holds up ok ...

On the positive side, a cap raising was probably expected and maybe factored in to a degree

Try not to worry too much. We've known for a while that they may have to raise working capital to get them through the first few months. Production still on sched for mid-may as far as I know so there is only a short distance to go now.
WDW

AnDy62 - This is why the share price edged lower in the fist place IMO. I would say that once the capital raising is over we will be in a period of growth, hopefully they only go for around 1 FOR 3 offer AND NO MORE OPTIONS so there is not significant dilution.

Mt Cannidah needs some serious cash spent on it too, until QOL is cash positive next year some time then I'm prepared to put my hand in my pocket.

yeah I agree there will be a growth period ahead as long as they get this over with quickly. It would be good to have this all over and done with before production starts... Idealy they would have done this before now but at least we can look towards Cannindah once its complete. Although the SP may not reflect it, Wolfram seems to pretty much be a formality now. Seems very low risk at 15c to me.

So the news is out, and QOL closed at 14c after hitting 12.5c. Better performance than I had expected.

Huge amount of buyers over the 13-14c range and total buy volume exceeds sellers > 5:1. Allotment at 12c (up to 5k worth) may prove to be not too bad a pick up - dilution is a worry though.

Anyhow, surely there could not be any more hurdles (bar this capital raising going pear shaped somehow) before we see production and cash flow

Personally im disappointed with the SPP. Why do they need 12mill? They said it would only be about 2 - 3 mill needed to finish Wolfram off.

They should have used less dilution (preferabbly debt) just to cover the small amount needed before production. Now the people who forked out 35c in the last placement will be pissed and the new finance guys (BBY) will be laughing as they get a sub market price SPP just before production starts.

A poor effort by management IMO, after doing so much right, its amazing how they failed at this...

All my thoughts only