Well, for better or worse, I am now officially an owner of BCMD at around $1. This could be fun.
Does the milling cost figure of $150 per ton include depreciation, interest, taxes, other? If the milling cost is a straight cash cost of $150 per ton, this could imply up to total costs per ton of up to $250 per ton (including SG&A, depreciation, interest, other). This would imply break-even with gold at 2 oz per tonne of rock and at $300 per ounce.
Assuming milling expense at $250 per ton on 15,000 tons a year equals $3.75 million. Add that to $4.3 million expense recorded for the 12 months ended June 1997 plus estimated $700,000 additional SG&A expense for recent hires that is total expense, with 0% taxes, of $8.75 million.
Table of potential income based on the gold per ounce to rock per ton ratio, assuming gold at $300 per oz and "total" milling costs of $250 per ton. Assume 42 million shares outstanding.
Ounces gold per..........Revenues from gold........Implied EPS w/ tot.
ton of rock milled.......at $300 per ounce...expense est. at $8.75 mil
(15,000 tons per year)
1 oz.....................$4.5 million............($0.10) per share
2 oz.....................$ 9 million..............$0.01
3 oz.....................$13.5 million............$0.11
4 oz.....................$18.0 million............$0.22
5 oz.....................$22.5 million............$0.33
This does not include potential of diamond mining.
Apply your own P/E and see what you get for a stock price.
This assumes a production company. I know zero about valuing a development company. Any suggestions would be helpful.
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