SLR, SILVER LAKE RESOURCES LIMITED

[bam_bamm]

In Reply To: triage's post @ May 2 2013, 05:43 PM

That comment was very much tongue in cheek triage.

Rightly or wrongly, I'm in the buy queue today at just a tick under $1.00, with a short/medium term outlook.

[flower]

In Reply To: triage's post @ May 2 2013, 05:43 PM

in the quarterly report management say they intend to drop the all in sustaining cash cost by another $100 an ounce from the $1,144 level they achieved in the March quarter

Bookmarked, will watch with much anticipation that intention becoming reality, should show in the SP!

[triage]

In Reply To: bam_bamm's post @ May 2 2013, 03:22 PM

b_b

whats 5.5% between friends

On an annualised basis?, at 120,000 oz of gold produced from the Mt Monger operations? well that comes to an additional $7.44m free cash flow that flower is happy to discard.

And if you don't fall for flower's sleight of hand of continuing to ignore that in the quarterly report management say they intend to drop the all in sustaining cash cost by another $100 an ounce from the $1,144 level they achieved in the March quarter so that flower's $1206 an ounce is actually on a forward basis about $1050 an ounce then that "pedantic nitpicking" translates into an extra $18.7m going straight into cash reserves (on an annualised basis).

Funny how a marginal improvement in costs per unit multiplied over lots of units can add up to a substantial stash of cash. But as I mentioned basic maths appears not to be one of flower's stronger points...

[bam_bamm]

In Reply To: flower's post @ May 2 2013, 02:32 PM

$1144 or $1206 seems pedantic nitpicking in the extreme..

whats 5.5% between friends

[flower]

In Reply To: triage's post @ May 2 2013, 01:19 PM

I will repeat the gist of my concern in this instance: you stated that SLR's "[March] Qly discloses that their "All in sustaining cash cost" of production is $1206".

What you posted is a clear and material misrepresentation of what is reported in the SLR March quarterly: the $1206 figure you used is the year-to-date figure which was negatively swayed by a relatively high figure for the September quarter and as well it does not fully factor in the effect of the lower costing Randalls operations that SLR picked up in buying IGR at the end of last calendar year. The report is crystal clear that the relevant figure for the latest reporting period, the March quarter, was $1,144 an ounce and the report was also crystal clear that management is embarking on a program that should reduce that figure by around $100 an ounce for the Mt Monger operations. The quarterly report also clearly states that management are of the view that the Mt Monger operations would continue to produce significant free cash flows in the June quarter even were the gold price to drop to an average of $1300 per ounce for the quarter

$1144 or $1206 seems pedantic nitpicking in the extreme, however if it makes you feel happier, you are right, I am wrong.

NST DRM and RRL leave SLR for dead in the total cost of production stakes, caveat: DRM has yet to produce, first gold pour scheduled for September 2013.

[triage]

In Reply To: flower's post @ May 2 2013, 10:22 AM

flower

Typical that rather than address the specific point of contention I raised you drop back to vague generalisations.

I will repeat the gist of my concern in this instance: you stated that SLR's "[March] Qly discloses that their "All in sustaining cash cost" of production is $1206".

What you posted is a clear and material misrepresentation of what is reported in the SLR March quarterly: the $1206 figure you used is the year-to-date figure which was negatively swayed by a relatively high figure for the September quarter and as well it does not fully factor in the effect of the lower costing Randalls operations that SLR picked up in buying IGR at the end of last calendar year. The report is crystal clear that the relevant figure for the latest reporting period, the March quarter, was $1,144 an ounce and the report was also crystal clear that management is embarking on a program that should reduce that figure by around $100 an ounce for the Mt Monger operations. The quarterly report also clearly states that management are of the view that the Mt Monger operations would continue to produce significant free cash flows in the June quarter even were the gold price to drop to an average of $1300 per ounce for the quarter.

Now either you have a problem comprehending what is stated explicitly in the report or for whatever reason you decided to misconstrue what was presented in the quarterly. Either way in my view given this instance and given your form you are a risk to anyone who reads your posts and takes them at anyway close to face value.

And as for the petulant comment that you find accountants to be somewhat tedious by nature well given your disrespect for detail and discipline I could well imagine that.

[flower]

In Reply To: triage's post @ May 2 2013, 08:17 AM

I feel obliged to step back into the ring and to inform others that in my opinion much of what flower has been posting recently is confusing and even mis-states the investment merits of a number of gold stocks.

Hi triage, you are entitled to your opinion as am I, that after all is democracy, I am entitled to assess merits of companies I intend to invest in as are you, so we have no disagreement surely.

When you have an environment which is as dodgy as this one is, rightly or wrongly I decided recently as far as gold stocks are concerned to only trade those solely based in Australia, SLR fits that bill.

Also resolved to only trade those stocks with a "total all up cost" of under $1000, the further away from 1000 the better and only in those stocks that operate in high grade operations.

SVL ticks all those boxes apart from the production costs and the inevitable problems that must occur by merging with Integra, however to provide a greater safety margin in todays environment its just that I prefer:

NST which has high grades and an all up cost of production of $A935
DRM which will have high grades and an estimated all up cost of production of $A880
RRL which has much lower grades and is a bulk operation with all up costs of production of $A626--however will qualify all those figures by inserting the caveat "as I understand the accounts"

I do not, nor ever have professed to be an accountant, but to object to blanket assertions, today gold in AUD is 1417, thus the benefit of trading companies with much much lower all up production costs surely is blindingly obvious.

(btw: always have found accountants to be somewhat tedious by nature!)

[triage]

In Reply To: flower's post @ May 1 2013, 10:24 PM

The poster flower has proven fairly conclusively that he is all at sea when it comes to financial analysis (eg confusing liquidity with solvency, muddling dcf analysis with pe ratios), totally at a loss when it comes to accounting terminology and principles (using cash flows to calculate profit levels, including depreciation and amortisation in "cash" costs), stumbles when it comes to even basic maths (using net cashflows over cash outflows to calculate profit margin), and now shows that apparently his ability to comprehend what is contained in relatively plainly written reports is also well below par. Quite seriously the quality and the quantity of misinformation that he is currently churning out is at best a distraction from informed discussion here on ss but worse in my opinion risks being misleading to those who take what he says without a grain or two of salt.

The SLR quarterly report clearly states that the all in sustaining cash costs in the March quarter was $1144 per ounce, and that the average selling price for its gold in the March quarter was $1535 per ounce (even after allowing for them paying out the last of IGR's hedging). The $1206 figure quoted by flower was for the year to date and was negatively affected by much higher costs in the September quarter (but then of course the gold price back then was a tad stronger and that was before SLR had incorporated the Randalls operations of IGR: SLR's Mt Monger operations have changed substantially since the September quarter).

Moreover the report clearly states that management has begun taking actions that they expect will see those costs drop around another $100 an ounce (that is for the existing Mt Monger operations, they do not estimate the costs per ounce for the Murchison operations which are expected to go commercial in this current quarter) and they explicitly state that they expect to "generate free cash flow from operations of ~ $3.0 - $3.5 m per month at a A$1,300 gold price." Their using a $1300 gold price as an average for the quarter presumes that for May and June the gold price would have to drop well below $1300 (seeing as for April the gold price was well above that figure) so I consider that management has been very conservative in estimating their free cash flows for the current June quarter.

For flower to suggest that SLR is "sailing too close to the wind" based on costs heavily influenced by operations in the September quarter in comparison to the gold price in the June quarter is simply preposterous imo.

I can never quite work out what motivates flower: is he really as ill-informed and confused as he often appears to me to be or does he post some of the drivel merely to bait responses from other posters. Since early 2012 I have applied a self-imposed bar on responding to his rantings and goadings as I agree with the comment that the ongoing school-yard spats involving flower and various others has become "tedious" but I feel obliged to step back into the ring and to inform others that in my opinion much of what flower has been posting recently is confusing and even mis-states the investment merits of a number of gold stocks.

[flower]

Have removed SLR from my watch list of gold stocks worth contemplating since the Qly discloses that their "All in sustaining cash cost" of production is $1206, so with spot at AUD1415 SLR sails far too close to the wind--IMO

[melua]

In Reply To: triage's post @ Apr 24 2013, 03:43 PM

I agree with most of your assessment triage. Yes, there are many companies much worse off than SLR. However, we have just witnessed what can happen when a company is "priced for almost perfection". Any hint of under-performance relative to what the market was looking for and look out below. That's what happened. The quarterly was terrible. No other way to describe it. A very astute resources investor commented to me that it was one of the worst quarterlies he had seen so far. The market agreed and so do I.
I think Les Davis is one of the best gold guys around. Just proves how tough a market it is in Australia to try and make money in gold. If the best are struggling, what hope others?