Couldn't have said it better. Perfect summation on what is a...

First 27 Last

Share
Profile

Follow
Berger978456

1,847 Posts.

157

23/04/18

13:13

Post #: 32628325
Share

Originally posted by Mongrel ↑

Its almost impossible for the average punter to compare corporate expenses of different companies because of the way they treat those various expenses. It can be done, of course, but only if you have a few hours to bother doing it. Even then, you'd need a contact in each company to ensure you got things in the right boxes.

The popular measure is cash cost of production, but even this is clouded by what exactly is included (ie, C1, C2, or C3 cash costs)?

As an example, Atlas' last quarterly announced a C1 cash cost (direct production costs) of $38/wmt and a "full cash cost" of $57/wmt CFR .(http://www.atlasiron.com.au/site/PDF/8302_1/HalfYearAccounts). What does "full cash cost" mean? Ostensibly, its the C3 cost, but its not. Atlas defines its full cash cost as "C1 cash costs, royalties, freight, corporate and administration, exploration and evaluation, interest expense, contractor profit share and sustaining capital expenditure but excludes depreciation and amortisation, one-off restructuring costs, suspension and ramp-up costs of operating mine sites, and other non-cash expenses." But its ambiguous, but not C3 as D&A are excluded. Importantly, it includes their "contractor profit share" which is not a preprofit cost but is included because its a liability!

MGX reports an "all-in group cash cost" of $45/t fob (https://www.mtgibsoniron.com.au/wp-...-MGX-March-Quarter-2018-Activities-Report.pdf). A footnote describes "all-in" as "FOB and include cash operating costs, royalties, sustaining capital expenditure and corporate costs, excluding Koolan Island restart expenditure." Again, D&A is excluded.

Good luck trying to meaningfully compare Atlas' $57/wmt costs to MGX' $45/wmt.

At the end of the day, its the declared profit and the ROC that are important. MGX is making cash. Atlas is going down the tube. End of story.

Expand

Couldn't have said it better. Perfect summation on what is a next to impossible thing to decipher.

MGX Price at posting: 44.0¢ Sentiment: Buy Disclosure: Held
Upvote

0 Great analysis

Reply

Top Stories

OD6

Leo Lithium locks in US$116.3M with sale of Goulamina stake to Ganfeng

MIN

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

History-making uranium sample grades and an imminent drill run. Infini Resources is poised to transform in 2025

WC8

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

ACW

This biotech stock raised $11M in a risk-off environment. Its Alzheimer's drug could change the game

There are more pages in this discussion • 15 more messages in this thread...

First 27 Last

Add MGX (ASX) to my watchlist

(20min delay)
Last 29.5¢		Change 0.000(0.00%)		Mkt cap ! $365.5M

Open	High	Low	Value	Volume
29.0¢	30.0¢	29.0¢	$15.79K	53.45K

Buyers (Bids)

No.	Vol.	Price($)
18	357301	29.5¢

Sellers (Offers)

Price($)	Vol.	No.
30.0¢	398384	15

View Market Depth

No.	Vol.	Price($)
1	37120	0.920
3	45770	0.915
3	31253	0.910
3	68342	0.905
2	44392	0.900

Price($)	Vol.	No.
0.925	15328	2
0.930	89494	6
0.935	70442	3
0.940	72592	7
0.945	128342	5

Last trade - 12.16pm 27/11/2024 (20 minute delay)

MGX (ASX) Chart

Couldn't have said it better. Perfect summation on what is a...

Top Stories

Leo Lithium locks in US$116.3M with sale of Goulamina stake to Ganfeng

MinRes's Ellison knows he screwed up – for that reason, hunt for new Chair to be sped up

History-making uranium sample grades and an imminent drill run. Infini Resources is poised to transform in 2025

Pan Asia rebranding to 'clear confusion' after bagging $35M for Chile projects

This biotech stock raised $11M in a risk-off environment. Its Alzheimer's drug could change the game

Buyers (Bids)

Sellers (Offers)