the new quarter for Crocodile Gold
A new quarter is coming to a close for Crocodile Gold and it 's stock is still lower than it should be.Even though it's production has risen since it bought the two mature mines in Victoria State of Australia.It borrowed money from Credit Suisse to pay for the two mines.Crocodile got so much production from these two mines in 2012 and 2013 that it's debt has been paid off and both mines are still producing.The mines are called Stawell and Fosterville.Stawell's production is winding down but it should be in production through 2014.Fosterville is still getting good production and Crocodile has expanded the ore-body.It will have sizeable production throughout all of 2014.Their new mine called Cosmo has been slow coming into production but the number of ounces is increasing each quarter.
Significant cash flow
Crocodile had positive operational cash flow of $18 million in the last quarter up from $11 million in the previous quarter although it's net income is not yet positive according to brokers.Using this cash flow is where Crocodile can move ahead and produce more ounces of gold.It has about a 10% interest in another Australian producer called Pitchblack and may soon increase it's stake. Pitchblack terminated an agreement to buy and develop some of it's northern property perhaps from a lack of cash and so may be open to a cash investment from Crocodile.But Crocodile has another card to play;it is working on a mine called Big Hill not too far from the Cosmo mine.It put $1.5 million into it in the last quarter and moved over some equipment from another mine.No information is available on the size of the ore-body but production here could replace the gold not coming out of Stawell in 2015.Barring that ,Crocodile may need a bigger share of Pitchblack's production by late 2014.Crocodile's management has proven agile in the past but will need some positive news on another ore-body by the second quarter of 2014.I think they will have some.
Significant cash flow
Crocodile had positive operational cash flow of $18 million in the last quarter up from $11 million in the previous quarter although it's net income is not yet positive according to brokers.Using this cash flow is where Crocodile can move ahead and produce more ounces of gold.It has about a 10% interest in another Australian producer called Pitchblack and may soon increase it's stake. Pitchblack terminated an agreement to buy and develop some of it's northern property perhaps from a lack of cash and so may be open to a cash investment from Crocodile.But Crocodile has another card to play;it is working on a mine called Big Hill not too far from the Cosmo mine.It put $1.5 million into it in the last quarter and moved over some equipment from another mine.No information is available on the size of the ore-body but production here could replace the gold not coming out of Stawell in 2015.Barring that ,Crocodile may need a bigger share of Pitchblack's production by late 2014.Crocodile's management has proven agile in the past but will need some positive news on another ore-body by the second quarter of 2014.I think they will have some.
Comments
Post a Comment