Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: Roebear who wrote (92870)	7/29/2001 8:33:53 PM
From: Frank Pembleton	Read Replies (1) of 95453

sweet & sour on CDE Roebear, I don't see much that's sweet other than the insider hold 16% of the float, I'm sure they feel the shareholders pain. Going from their annual report: PSR - .43 P/B - 6.2 Market Cap - $43 million Debt - $270 million Revenue - $100 million Cost - $164 million Silver accounted for 57% of 2000 revenues and gold, 43%. CDE return to black would take at the very least $7.00 silver. One should take into account that they are mining about 10 million ounces of silver per year, this outfit has about a 5 year lifespan with proven & probable reserves estimated at 50 million ounces. IMHO a 10 year reserve would be a more comfortable margin of safety, it takes at least 5 to 7 years to get a new mine up and running. The gold part of their income I didn't quite understand, their cash cost is in the $400 range, they use hedging to get $320 per ounce? I really don't get it. I've read they are in the process of selling the gold business. There is also a legal issue with the EPA on some polution clean-up. I not sure how that turned out, didn't see any detailed press releases on the final outcome of the litigation. Regards Frank P.

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