You mention the annual report - the other way to get it, and much quicker, is to download it in Adobe form from the sedars - 16 April 1999 1963k pdf - sedar.com
Although i prefer the 2540k pdf Annual Information Form filed 27 May - less pictures, more background detail. The zoomable maps and comments in the AR are interesting, though - there's a reference to Catoca on page 6 - that's Ashton of Oz, right? Putting out a million carats a year, and just down the road. Quote from Walsham, page 6 -
"The alluvial deposits at our Luo mine have a limited life. The kimberlite resources must be developed so we can grow and generate a satisfactory return for our shareholders. As we already have an established operation at Luo, we do not have to wait for all the problems in Angola to be fully resolved before starting production from our kimberlite deposits. The incremental costs of developing the Camatchia pipe are justifiable. The pipe is exposed at surface and the existing diamond recovery plant can be easily modified to process the kim-berlite ores. It is reasonable to suppose that Camatchia can soon produce upwards of 400,000 carats of good-quality diamonds a year. One of the unique aspects of the diamond potential of Angola is that many of the kimberlites tend to be very large and exposed at surface, making for excellent mining economics. Development of Camatchia is a key to our improved operating performance and short-term growth. As a comparison, the nearby Catoca pipe, which another company began mining in 1997, now produces more than one million carats per year. Our other kimberlite projects in Africa — Camagico, Koidu and Kao — are expected to be the foundation for longer-term growth of the company. All have significant resources of high-quality stones."
Four hundred thousand carats times two hundred or so US annually - wouldn't that be nice, a gross from Camatchia alone of eighty millions US per year. Haven't seen a capital cost estimate or time schedule to achieve that, though. Once cash flow turns positive, which should be soon - in fact it may have passed that point already - it would seem reasonable that dmw puts the first of its net gains into Camatchia, eh. It's not like they have to save up to pay income tax - there are big back losses to cushion against that.
It's been two weeks since more cheap paper got issued - there may not be any more coming. Time will tell, but i doubt that more comes out, since positive cash flow has alleviated or soon will alleviate the need. So here we are with ~200mil out, ~300mil f/d - 102.46mil warrants priced .17-.35 sitting there ominously just above the share price.
Which for sure scares people off. Never mind the natural share price discount for African assets compared to those in countries perceived to be 'stable' - whatever that means to anybody who knows how high is the stack of environmental bumpf Aber has to deal with, and the hard cash dollars they have to pay to deal with it - those existing warrants and options, along with the suspicion that more may yet be coming, are damaging the perception of the possibility of improvement in the current market cap of ~45milCdn based on ~300mil f/d, even though around 19milCdn cash would come in on exercise, and the assets are humongous. Put them in the NWT and they're worth a couple of billions.
So later i'll do a post on share structure, warrants, etc .... then one on assets ... i think you buy a carat of diamonds in the ground a whole lot cheaper when buying dmw paper at current prices than any NWT paper, and considerably cheaper than Rex or Southernera paper, even .... and while a discount is reasonable, current conditions should be reducing it, but aren't yet - the discount has become quite excessive imho ...... cheers. |
