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Gold/Mining/Energy : Exall Resources/Glimmer Resources -- Ignore unavailable to you. Want to Upgrade?

To: CLK who wrote (548)	4/12/1998 7:37:00 PM
From: James N. Wilson	Read Replies (2) \| Respond to of 1319

CLK - I too share you concerns about using the fully diluted numbers vs shares issued. However, I don't have access to EXL's FD numbers so don't think it would be fair to use shares issued for one company and FD numbers for the other. Perhaps another member has the EXL year end report to share holders and could provide the number for FD shares. If all warrants and options are exercised GME will have about 7 million shares out with no debt. For the year of 1997 the Glimmer mine produced 39,852 oz's of gold with rev's of C$17,549,564. At this point GME's portion is being held in an account pending settlement. This could be a significant chuck of pocket change I would think. * GME - 7 million shares FD Current Glimmer mine reserve count all categories 563,278 ounces of gold. Blue sky potential 2 million ounces plus. Glimmer's part 225,311 oz assuming 40 percent which should be a conservative number. GME market cap to reserves in the ground US$22.05 per oz. This seems very cheap for a mine in production. I would expect to see reserves valued at US$75 -US$100 per ounce. Cash flow per share C$0.52 - cash cost US$220 forward with forward sales at US$320 and GME's portion of 65,000 oz per year. * Worst case - spot US$308 - C$0.46 per share. With thoughts now of a 10 year plus mine life we should be able to use a multiple of 10X or C$5.20 for GME shares. It is easy to see that GME could be undervalued by a factor of 5X. This is discounting the potential of a 2 million ounce deposit which now seems to be more likely than not. There is nothing that I'm aware of about this play that could be holding price levels down except the price of gold and the pending JV settlement. Once this is resolved I would expect to see both companies implement a more aggressive investor awareness program. My thoughts are to put a block of GME or EXL in the portfolio and see where they are 3 - 5 years down the road. Assuming the fundamentals do not fall apart. With higher gold prices and a JV settlement that both parties can live with shares of both companies will jump sharply I would imagine. take care, james p.s. if you will check my posts I have always included to the best of my knowledge "shares issued" when speaking of GME shares out.