RBM - Redbank Mines

[surfingman]

Yep, but they're spending about $1-1.5m a quarter, so they need a top up even with this. If this ann isn't about a capital raising they will need to soon.

Thanks Kennas I agree they need funding, I had a look at cash flow report yesterday and took a punt they would be carried over the line to the upgrade...

If it's fund raising it would be very interesting to see if they try for Stage 2 financing in the one placement.

 

[Flipper15]

They did a placement of 3 mill shares @ 16 cents on the 31/5/07 for $480,000 and with monies coming in from sales to Glencore it is unlikely in my view to be a capital raising. They have not done any drilling since this placement so they must still have some funds left, unless the $480K was used to pay for the Mar/Apr drilling campaign.

Also the 31/5/07 announcement was not preceded with a trading halt. So if it was a capital raising it must be a big one.

We are all guessing but I think it is most likely that it is the JORC resource upgrade we have been waiting for.

The other possibility is great results from those 2 diamond holes.

I don't recall them ever going for a trading halt prior to the release of drilling results and they have had some good ones this year. So I believe it can only be the upgrade or abnormally great drilling results.

Hopefully we can break through 20 cents and stay there.

Flipper

 

[mick2006]

after going back over recent company announcements I am more confident that it won't be a capital raising, it will be a funding arrangement with Glencore International (massive commodity trading company). I refer to the announcement by RBM on the 13/06/07, in which it discusses the fast tracking of increased copper production.

If it is a funding package instead of a capital raising (so no share dilution) I think the market will see this as a positive as it shows the company is serious about getting the increase in production happening.

http://www.redbankmines.com.au/files/rVtRth5CRUhvf6It.pdf

 

[Sean K]

If it is a funding package instead of a capital raising (so no share dilution) I think the market will see this as a positive as it shows the company is serious about getting the increase in production happening.

http://www.redbankmines.com.au/files/rVtRth5CRUhvf6It.pdf

Yes, absolutely agree with this. Not so much about been serious, but that they have support from some players with $$, who see the potential. That would be a good sign and support them somewhat.

 

[mick2006]

hey kennas, taking it one step further and trying to read between the lines, the last couple of presentations by Gino Vitale MD of RBM, he has constantly been talking up the relationship with Glencore.

I believe the trading halt will result in one big announcement outlining the funding package with Glencore, the updated resource statement for the Redbank project area, and finally the decision to upgrade the plant/copper production. This would be a major boost for the credability of RBM.

Also you may ask what Glencore is getting out of the deal, they are getting their foot in the door to what many people are speculating,and that is the massive sulphide copper deposit that lies beneath the current Redbank project area.

And if RBM can get a funding package of say $10-15 million not only can they increase production they can also start drilling those deeper holes to see exactly what lies below the brecia pipes in the Redbank Area.

 

[mick2006]

guys check the quarterly cashflow report on the 30/4/07 and look at the info contained about cash injection after the completion of the quarter.

it states the company received $690,000 in April as sales from Glencore and Tax refund from the ATO, and they also state that the Redbank Project will be cash flow positive in the June Quarter.

So add the $690k to the $480k raised during the current quarter and the $500k in cash and shares received for the sale of their gold tennements, that puts them in a much better financial position.

I still get the feeling it won't be a capital raising (at least I hope not)

http://www.redbankmines.com.au/files/oddDFA8WRORN9Kev.pdf

 

[surfingman]

I believe the trading halt will result in one big announcement outlining the funding package with Glencore, the updated resource statement for the Redbank project area, and finally the decision to upgrade the plant/copper production.

I have come to the conclusion it will be the resource upgrade at minimum, or the above is also possible but they would do this over a few announcements for most effect on market.

They are currently producing 1 000 Tpa could the announcement could also incorporate first payment information.

 

[Flipper15]

On reflection it is unlikely to be the resource upgrade or drilling results.

You guys are right, it is likely to be some sort of corporate activity re funding of projects etc.

Nonetheless it should show the market of their focus on getting the Redbank Copper Project moving as quickly as possible into Stages 2 and 3.

Good luck to all.

Flipper

 

[powerkoala]

ann out
trading halt lifted
jorc and resource upgrade just like what we have been waiting for
now let see whether 20c barrier will break today

 

[motion]

I like how they did the Media Release straight after the ann great work by management... This is just the start of more great news to come.... with them ann Redback Accelerates production strategy... Excellent work.. lets see how the market takes this..

 

[mick2006]

at least it wasn't a capital raising, I took profits on open a bit dissapointed by the size of the upgrade, but will watch closely to re-enter when they finalise plans for the upgrade in production.

Will be interesting to see the quarterly report in regards the cashflow from current production. If they have managed to make the production cashflow positive which will limit the need for capital raising.

 

[Sean K]

at least it wasn't a capital raising, I took profits on open a bit dissapointed by the size of the upgrade, but will watch closely to re-enter when they finalise plans for the upgrade in production.

Will be interesting to see the quarterly report in regards the cashflow from current production. If they have managed to make the production cashflow positive which will limit the need for capital raising.

Yes, this was much more positive, but they will need more money shortly as has been analysed here. Failed breakout through 15 so still sliding sideways......

 

[AJ_]

dang, market reaction was not good at all.... ohwell, still holding

I guess it takes a bit to impress the market

 

[fgzq88]

71,000 tonnes copper = US$560M
capital size = A$20M

2.3 million tonnes or 45% of the revised mineral resource is
contained in the top 100 metres from surface, accessible
through open cut mining;
means low cost production

any thoughts?

 

[powerkoala]

it is quite a good news, but i thinks market consider 20% resource upgrade is quite low ?
perhaps we will see some action after market revalue RBM.
i like the idea of open pit though, soon they will produce cash.
maybe then, some bigger companies are considering to take over RBM ?

 

[motion]

Hey guys,

I just wanted to ask people what they think of the ann LinQ Resource Fund acquires 5.7 percent interest in Redbank.

I'm not sure what to make of this.. Is it a good or bad things for RBM...

Thank you for your thoughts.

 

[mick2006]

hey motion the most important thing for RBM at the moment is whether the Redbank Project has become cashflow positive. If it has the market will be more comfortable about the company and that they won't need to keep raising capital. So pay close attention to the upcoming quarterly report.

As for the equity stake it gives the company much needed funds to get the upgrade at Redbank started. A little dissapointed with the issue price of 11.5c.

There is no doubt about the explorational upside to RBM it just seems until they can get the production sorted out the market won't value it compared to its peers.

Saying that at 12c the company is starting to look very attractive for some short term gains.

 

[motion]

hey motion the most important thing for RBM at the moment is whether the Redbank Project has become cashflow positive. If it has the market will be more comfortable about the company and that they won't need to keep raising capital. So pay close attention to the upcoming quarterly report.

As for the equity stake it gives the company much needed funds to get the upgrade at Redbank started. A little dissapointed with the issue price of 11.5c.

There is no doubt about the explorational upside to RBM it just seems until they can get the production sorted out the market won't value it compared to its peers.

Saying that at 12c the company is starting to look very attractive for some short term gains.

G'day Mick,

Thank you for taking the time to reply to my post. I will keep a watch out for the cash flow report over the next couple of days. Yes I agree the 11.5c issue price is not the best for current share holders.

I also agree that at 12c you can make some good short gains given the right market.

Thank you again for your comments I will be keeping an eye on the comming events.

 

[Flipper15]

motion, although it is a good thing to have the new investors on board I like a level playing field.

In my view this is not happening here. Like someone has said, the investor who took a placement of 3mill @ 16 cents wouldn't be happy.

Okay the share price is lower than then but my memory is that this last placement was made when the share price was at 15 cents. So they got more then.

So why quite a bit lower this time and why do they need the money.

Today's announcement should have had much greater detail as to what the money is to be used for such as is done in prospectuses.

The new investors is by itself a great thing as they obviously want to make money for their funds/stakeholders. But to me the psychological impact of the lower price is not good. It should have been 14 or 15 cents.

If these sophisticated investors want the stock then they will pay more than the current share price.

After all we all know the share price is way under what it should be.

If lower prices are being offered then everyone should be offered it, not a select few.

Mick2006, you have hit the nail on the head. Until they get the production up then they won't get the market on side. Very good point and it probably tells the whole story here.

I hope they are working for all shareholders. They don't help their cause by not communicating fully their reasons why they do this.

With my estimate of $400K per month from the stockpiles there should be plenty of money going around.

As you say it is time to watch the quarterly closely re these production targets.

Flipper

 

[steven1234]

The difference in price and value is amusing at times.

Aegis valued RBM at 33c back in April. Good news since then and the price is at 12c today, lower than the price prior to the recent good news. Regardless of the current market climate, the market does not look favourably on RBM. Lets hope this changes at some stage.