TMR - Tamaya Resources

[prawn_86]

hey rico, I certainly like TMR short term it will certainly benefit from the inclusion in the all ords and all the index tracking funds having to buy into it over the next couple of days to maintain correct index weightings.

Mick,

do you know any specific funds that track the all ords?

i did some research but couldnt find any that specifically track the all ords. Lots of other index trackers, but none for the all ords that i could find.

 

[Bolivia]

One of the reasons why the SP could be finding headwind is because of potential cash flow problems and a resulting cash raising.

I just read some research from Patersons (analyst Josh Welch) about TMR and he was of the opinion that there have been significant delays with the Cinabrio mine expansion. In his opinion the timing of the expansion was critical in order for them to fund their development schedule. The poor output has meant thay have had to purchase third party ore which has resulted in lower grades/recovery. Armenia is burning a $2m/quarter hole in cash flow.

Basically, in order to feed it's expanded mill, TMR will have to keep purchasing third party ore. Not great when ore grades and recovery are so poor.

I hold TMR and am concerned that this may be why some large holders have sold out - and continue to do so. If the company is going to have to raise fresh funds, the SP aint going anywhere.

I have no doubt that this company has some huge upside down the track but in the short term there could be some significant headwinds.

I am not sure how true this all is, but reading this kind of research gives me a reason why the share price is languishing.

Thoughts anyone??

 

[mick2006]

hey prawn from memory there are quite a few managed funds that are set up to track the XAO, they advertise them as australian share funds, but basically they just track the same weighting's as the XAO.

also the US markets have a couple of australian ETF's, CNBC was saying there is one set up to track the XAO

 

[habs]

they are in the process of phasing out 3rd party ore as per one of there recent statements, might have been in the quarterly.... and will be 100% fed by their own very shortly, i think it was end of march or april from memory.

 

[urgalzmine]

Well the good thing is that there are a lot of buyers at .140-.145

thank god, The market is really in a weird mood these days

 

[mick2006]

interesting announcement out after the close yesterday, looks like company is undergoing a slight change of direction.

they are delaying the start up of production from their Armenian Gold Operations in favour of a massive 45,000m drilling campaign to upgrade the resource. This change of direction stems from the enormous interest in the Lichkvaz Project from Asian interests both in terms of joint ventures and outright sale of the project.

Listen to the following boardroom radio interview to confirm interest in the Lichkvaz Project :

http://www.brr.com.au/event/42052

I believe that TMR has formed the view they can make a substantial profit by upgrading the resource at Lichkvaz and then selling the project rather than going down the development path.

This would be an excellent outcome for the company, with the current NPV of the Lichkvaz Project already double what they paid for it.

Any profits from the sale of the Armenian Gold Operations could be ploughed straight back into their Chilean Copper production, where they are ramping up production to 12000 tonnes a year.

With several massive copper deposits in Chile crying out to be developed by the company, this change of direction could be a massive driver going forward.

 

[prawn_86]

interesting announcement out after the close yesterday, looks like company is undergoing a slight change of direction.

they are delaying the start up of production from their Armenian Gold Operations in favour of a massive 45,000m drilling campaign to upgrade the resource. This change of direction stems from the enormous interest in the Lichkvaz Project from Asian interests both in terms of joint ventures and outright sale of the project.

Listen to the following boardroom radio interview to confirm interest in the Lichkvaz Project :

http://www.brr.com.au/event/42052

I believe that TMR has formed the view they can make a substantial profit by upgrading the resource at Lichkvaz and then selling the project rather than going down the development path.

This would be an excellent outcome for the company, with the current NPV of the Lichkvaz Project already double what they paid for it.

Any profits from the sale of the Armenian Gold Operations could be ploughed straight back into their Chilean Copper production, where they are ramping up production to 12000 tonnes a year.

With several massive copper deposits in Chile crying out to be developed by the company, this change of direction could be a massive driver going forward.

I think this will prove to be a good move in the long term.

Gold mines are notoriously difficult and require a totally different set of skills and management.

If they can upgrade the resource and then sell the project, it will give them the ability to focus on their Chilean operations, and consolidate themselves within the copper industry and within Chile.

However i would not be surprised if the market reacted negatively in the short term, as this ann is pretty much out of the blue, and im sure there were a few people who liked the thought of having an operating gold mine within the next couple years.

 

[Wysiwyg]

There could be a number of reasons for this decision not to ramp up the development stage and get a piece of the high gold price.

1)they will miss the window for high gold prices
2)they see copper demand will be ongoing and focus on Chile
3)political instability
4)world economic outlook not encouraging

 

[mick2006]

I think this will prove to be a good move in the long term.

Gold mines are notoriously difficult and require a totally different set of skills and management.

If they can upgrade the resource and then sell the project, it will give them the ability to focus on their Chilean operations, and consolidate themselves within the copper industry and within Chile.

However i would not be surprised if the market reacted negatively in the short term, as this ann is pretty much out of the blue, and im sure there were a few people who liked the thought of having an operating gold mine within the next couple years.

your 100% right there Prawn, I think a lot of people are mis-reading what the company is saying, maybe they could have outlined it better.

In effect all they are doing is what will result in the greatest benefit for the company and its shareholders.

By selling of the Armenian assets they will have a huge chunk of cash to assist in developing/expanding the Chilean copper operations, which are already profitable and expanding production.

there maybe a knee jerk reaction by people who don't understand the announcement this would be a perfect time to either buy in or top up, remember the company is not in threat of going out of business in fact this decision will increase profitability straight away.

 

[agro]

took a battering today for some reason unknown to me - i didn't read the announcement so that may be related to it..

is this ripe for the picking?

 

[Tristo]

Poor agro, you won't get far without reading. Read a few posts up for a very good analysis reading-between-lines.

 

[rogue_investor]

sad times for the TMR share price again. Announcement today that 2 executive directors pick up a few million shares between them. Does anyone know if the price of those shares was decided back in 2006 or were they just lucky enough to be granted these when the sp is so low?

 

[vegemite]

From Monday's Australian...

Share slump makes it a tough time to run junior miner
Kevin Andrusiak | April 14, 2008

IF Tamaya Resources chairman Hugh Callaghan is looking for shareholder love at the moment, he readily admits he is in the wrong business.

For the time being, that is.

With a depressed share price and day traders seemingly creating havoc with Tamaya scrip, it's a tough job being at the top of a junior mining company.

Not even record copper prices, the rising potential of some very promising exploration leases or market forecast of a more than doubling of earnings before 2010 have pacified shareholders who have seen the Tamaya share price drop by 65 per cent in the past six months.

Most of that was due to a savage market reaction when Tamaya released its December quarter results, which showed the copper/gold miner had been forced to mine grades lower than expected at its Cinabrio mine, part of its flagship Punitaqui project 400km north of the Chilean capital of Santiago.

Some of it was due also to the reaction to learning that third-party ore grades used to bolster the weaker Cinabrio product were also not up to expectations. Just a sprinkle of the sell-off was probably due to the fact that dreaded short sellers had been driving the scrip lower.

While the follies of the past six months are still fresh in the memory of Callaghan and his Tamaya team, the aim is as strong as ever to build the company into a mid-tier miner of note and reward the faithful shareholders who have waited patiently for payday and for the company to deliver on its promises -- especially Project 3000, a plan to mine at least 3000 tonnes of ore at Cinabrio a day and have the same amount going through the mill.

Callaghan likens the rebirth of Tamaya -- which was rebadged from SMC Gold when he took over the chairman's post 17 months ago -- as similar to the flight plan of a jumbo jet, which uses most of the fuel and energy getting up to the intended altitude before flying becomes a lot easier.

"Maybe we should have kept our mouths shut instead of setting challenging targets for ourselves early on," Callaghan said after the World Copper Conference in Chile last week.

It's clear that with more than 1 billion shares on issue and a market capitalisation of about $130 million, Tamaya needs to put a broom through its capital register and tidy it up.

Callaghan, a former Rio Tinto and Xstrata executive whose Chilean experience includes a stint at Escondida, declined to comment about when, or even if, some kind of share consolidation would one day occur.

It is a safe bet that it has been pondered and will be investigated further by the Tamaya board, especially if the day traders continue to have their way with the share price.

If a share consolidation was to happen, it would probably be in conjunction with an intended listing on the Toronto Stock Exchange, which is expected some time this year.

However, Callaghan knows there is much more important work to be done before that happens, like proving to the market that the 3000-tonne-a-day mark for the Cinabrio mill has been reached. Along with that, he wants to prove the naysayers wrong about the potential of Tamaya's Chilean exploration assets, including the Filipina Grande and Dalmacia/Arco Iris prospects.

We've been through a pretty rough patch lately, but Filipina Grande has definitely been a morale booster, Callaghan said.

Tamaya is even hatching early plans for Dalmacia, 30km south of Cinabrio, to one day be a 20 million to 30 million tonne resource, while the JORC resource for Filipina Grande, in the neighbouring Atacama province further to the north from Cinabrio, is established at 12 million tonnes at 1.28 per cent copper sulphide. The Cinabrios resources inventory totals 7.4 million tonnes at 1.6 per cent copper sulphide.

Company forecasts show Filipina Grande could begin production in 2010, which would add millions to the bottom line.

Still, Tamaya has come some way since Callaghan first walked into Cinabrio and found an operation breaking virtually every mining law.

In fact, Tamaya thinks it can get up to 4000 tonnes daily before the end of June next year. Roughly translated, that's about 15,000 tonnes of copper annually, a marked improvement from the current 9500 tonnes or so.

It was one of our biggest mistakes, not acting fast enough in Chile when we found the company wasn't being run as it should be, he said.

If you're looking for regrets from Callaghan in his brief tenure at Tamaya, then the straight-talking former Zimbabwean has a few. He thinks the company lost focus on the Chilean assets in favour of Armenia when it took over Iberian Resources last June.

The writer travelled to Santiago as a guest of Tamaya Resources.

 

[prawn_86]

Fair few announcements of late.

Armenia has potential for an open pit mine they have discovered, and they are continuing to drill aggresively.

Chile is what i like the most, and once they reach their 3000tpd target im hoping there will be a bit more interest.

Also technically looks as though a bottom may have been found at 12c.

Currently on a PE of 23.

Seems to be another small cap flying under the radar...

 

[prawn_86]

Correct Habs, my mistake.

They are now looking at upgrading to 400tpd.

Also a SPP at 11.5c means that the price wont be going upwards fgor the next month. I can see managements point, its just a it annoying to know that there is at least another month of going sideways

 

[laurie]

Another dilution exercise this is becoming a joke not sure what the figure is but I stand to be corrected at well over a billion shares

cheers laurie

 

[prawn_86]

Since there has been a lot of anns recently i thought i would share my views.

Any comments appreciated.

SPP: will cause dilution unfortunately, but there are other companies out there with a large amount of shares on issue that still do well. MC and PE is more important imo than shares on issue. I can see why management are doing it, but not sure i agree totally

My biggest issue is it means the price will be trading sideways for at least another month.

PE: PE @ 11.5c is 19, based on last years profit figures.
This puts them in the realm of most mining companies, but does not account for any of their other projects or recent upgrades to throughput capacity.
Even if higher grades are not reached, and costs stay as they are, one would expect an increased profit this year due to higher throughput and cu prices so therefore PE ratio will fall even further

MC: Around $140million. Seems to me that this would be fair value if they were an explorer/developer and were not achieving profits. Personally i think that something about 1.5 - 2times this figure would be a more realistic value at this very moment.

Exploration: We all know that Armenia has a huge drill program going. I like this as it keeps the focus in Chile for now. Other Chilean projects are being drilled heavily and hopefully even more JORC figures continue to come out

Management: Everyone knows the potential these guys have but they seem to fail to deliver on the crucial factor, share appreciation. Not necessarily all their fault, but ultimately that is their job. Providing they continue to upgrade mine capacity i guess it is only a matter of time.
Hugh has said the wants to be a $1bill co by 2010 so thats 7x current prices.


And that sums up my thoughts...

 

[JoeWinters]

Isn't the bottom line here that they are in need of additional funding, and not getting it from other non-dilutive sources?

I hold 300,000 shares at about $0.25/share, so not looking real good at the moment.

Wish I was in purely speculative stuff like Murchison or Atlas Iron - no production to date - those shares trade basically on fantasy, which of course means $3.00 to $4.00....

Frustrating times....

 

[habs]

Depends on the reason you bought the shares. If you believe in the company fundamentally it has only been getting better and better since the take over of iberian, nothing has really changed, a ramp up of production capacity over in chile and issue a few more shares whilst the copper prices are high, yeah go for it.. TX listing this year something hopefully, then a share buyback or maybe a FMG 10 for 1 deal.. if your only in it to trade here and there, then yeah deffinately not the best stock around, longer term hold and the price is great for accumulating to hold.

 

[cammilnes]

One thing that I am not sure on. After looking through the annual report. They have exploration expenditure listed as a $140m asset. Pretty much all of the NTA for this share.

I know they have good assets but as exploration expenditure is "dependent upon the successful development and commercial exploitation,or alternatively, sale of the exploration tenements." I think its worth a closer look.

Anyone got thoughts/resources on this?