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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: Chunger who wrote (25026)	11/11/2006 5:43:00 PM
From: LoneClone	Read Replies (3) \| Respond to of 78410

Back to Rio Narcea... I took my mental stability into my hands and in search of more insight ventured into TEVWKAY (The Even Vaster Wasteland Known as Yahoo.) I had to wade through a lot of crap, surprise, surpise, but here are the two most insightful posts I came across. The first is from someone called cliffvb: "Production was down in Q3 at the nickel mine because: A. A lower grade of ore was mined. (Nickel grades were 25% below the year ago period.) The company expects that combined ore grades will improve from 11% in Q3 to 12-14% on a sustained basis. B. Production was also slowed down becasue they tested creating seperate concentrates of nickel and copper. That testing has been discontinued. Throughput in October has increased to 140,000 tons vs. a 125,000 ton average in Q3. Copper derivative losses occurred because futures prices for the metal are also factored in. While the spot price of Cu was unchanged from the end of Q2 to the end of Q3, futures prices were higher creating the loss. (For example, March 07 futures increased from 3.15 on June 30 to 3.40 on Sept 30). Gold derivative losses occurred because put and call option premiums are also related to volatility. Sales were again lower than production in Q3 as they were in Q2. The company expects sales to exceed production in Q4. Production at Aqua Blanca next year, while below previous estimates due to a reduction in ore grades, is still expected to be 20% higher than the current years production. I was also disappointed in Q3 results although the stock price action yesterday now reflects that news. Q4 results should definitely be better and I'm thinking it will be worth the wait to see those results." The scond is from a boastful fellow named agandau04: " I rarely post, but I always read. For the record I have 40,0000 shares and 120,000 warrants. Tobinator and I were talking about RNO long before Firecracker ever became involved. You can verify this by going back and reading the OLD posts. To be blunt about it I got my ass handed to me Friday and I am NOT happy about it. Let me give you a little background info. I have a Bach. of Science in Accy. I have a Master of Accounting Sciences degree. I have been a CPA for over 25 years. I was a contibutor to the preemeinent Intermediate Accounting textbook and to the preeminent CPA Review textbook. I have been an instructor at major universities. I spent several years in public accounting. Hedge accounting is a poorly thought out bunch of academic BS. Focus on cashflow to get a better picture. Operating cashflow (in spite of mgt. messing with a process that had not reached stedy state performance - go figure - not the sharpest tools in the shed) was $23,6000,000 or $.15 per share. If you ever tried to spend an EPS you would know CASH is KING. YTD cash is $54,000,000 for 9 months or about $.35. RNO has a $10,000,000 Revenue/Cash bogey sitting in inventory or another $.06-$.07. YTD you could be looking at $.41-$.42 as RNO continues to RAMPUP production. Full year Cashflow per share will be close to $.60 per share while they are mainting a growth profile. I said I am NOT happy, and I am not. But my problem isn't with Firecracker or with results. Management should have provided production updates when they KNEW they had a big miss, But, while not good, that is not why I am NOT happy. I listened to the conference call 3 times and, quite frankly, managament did not know how to explain/present their own results. At the end of the day, things are good. If we can get management to leave the mine operators alone, we have a good ore body, good mine operators, a great metals market, and an enviable Cash position ($54,000,000) and growing Cashflow. Oh, and lest I forget, a NEW mine opening in less than a year. So what happens on Monday? I don't know, but I do know not to look a gift horse in the mouth. There will be folks that don't understand or who are uncomfortable and will be selling on Monday. I will be on the other side of the transaction. Best to all."