"The Company estimates its mining developments and operating costs to be approximately $1 million for remainder of fiscal year ending June 1997 and additional financing will be required in order for the Company to cover such costs...The Company anticipates raising the needed funds from the sale of common stock or JOINT VENTURES. No assurance can be provided that the Company will be able to raise funds to continue and expand its operations...In the event the Company is unable to obtain additional financing the Company may be required to seek protection under the bankruptcy laws." -FORM 10QSB(Q ended 3/97)
This blerb I have chosen is not meant to be pessimistic, but it does identify the real problem which may exist for BCMD and many mining companies. Now, BCMD is doing well in production as we know from more recent information, but there is still a great need for a joint partner. Giving away stock like it has is not the best way to go.
Knowing this, I am extremely impressed with the potential of the mines BCMD owns and operates. According to info I received(I assume all of you have it too), there are large untapped reserves in the mines shut down around WWII by the government(although I am not totally clear on why on first read through). BCMD probably spike back in the early 90's when I was in because we were reading what you now know. So much gold in them thar hills. Among other things BCMD was unable to get to it. Today, BCMD is getting to it and that is the main reason why I have come back.
BCMD is literally sitting on a goldmine, and they are now bringing it up. JV would ensure production could continue for several more quarters at the very LEAST. They need a little more long-term stability to prevent a shutdown of any kind today or tomorrow. I am unsure as to how they are sustaining themselves now, but that is a question I shall pose to PR.
Doing my own numbers, at 60 tons per day, 1oz. gold/ton, earning about $160 per ounce, BCMD "could" bring up 60oz. per day equalling $9600 per day. Assuming 5-day work week and a perfect 12 week quarter, that translates into $576,000 in earnings. Let us kick out $76,000 for other expenses(whatever), this would be $500,000 for a quarter. I guess we use about 25 million(this may be high, but for sake of argument and simplicity of calculation) in calculation for eps. This would be eps of .02. For a year it may be extrapolated to .08. Continuing with this CONSERVATIVE estimating, at PE of 10, this would be .80 and PE of 20, this would be 1.60. It appears that the price has settled (the high) around the neighborhood of 1.25, which would be about in the middle of this range. Of course PE could be higher. My opinion is that we have found our range based on these projected production numbers, and won't move much higher unless news looks to alter the projections significantly or a JV partner comes on board. We will stay here till there is news-~1 is the support, so a buy would not be unwise at these levels, and shorting would.
Miller
Miller |
