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Non-Tech : The Woodshed

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To: SwampDogg who wrote (39163)	5/14/2006 7:56:13 PM
From: ItsAllCyclical	Read Replies (3) of 60928

(edit) I don't fault them. They are already a low cost producer in general even w/out the Zinc credits. It was my perception that only about 1/2 their Zinc production was sold forward, but I could be wrong. The other kicker of course is that their costs are set to go down further into 2008 as the new mines come on line. Do you have any good articles/links for where I can get the dirt on the Zinc story? I asked the CFO to provide some sensitivity to various metal prices in their next presentation similar to SLW. He gave me some 2006 numbers for cash flow/earning that I used and multipled for 2008, but now I'm wondering if he gave me numbers that included their hedged Zinc vs unhedged. I'll have to call back. Maybe PAAS is cheaper than I thought right now. My rough swag is that they could earn about 1.25 in 2008 based on $12 silver, but I think I need more info on his Zinc assumptions. Also I don't think my rough calculation takes into account lower costs regardless of Zinc credits.

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