SBM is meeting its production targets and has raised its upper...

SBM is meeting its production targets and has raised its upper target forecast for 2015-16 by 5000 ounces to 375k ounces.

I am expecting Gwalia to increase production next quarter by around 5000 ounces if current grade is maintained and they improve ore production. The issues they had with the conveyor belt that is used at Simberi did not seem to have much of an impact on gold production but I suppose trucking the ore for 2 weeks would have cost them something extra. We will get the costs when they release the quarterly report later this month.

The debt level is falling rapidly as they accumulate more cash and make payments in advance/repurchase their Notes. The USD250 note facility has now been reduced to USD168m and the Red Kite facility is down from USD75m to only USD21m in only around 12 months months.

Total debt is now USD189m (down from USD325m) which at the higher AUD exchange rate of 76 cents amounts to AUD249m. Cash balance has risen by AUD14m to AUD114m. Net debt is reduced to "only" AUD$135m, which should be fully covered by retained earnings by the end of 2016 or March 2017, depending on how much tax they are required to pay. The company's remaining debt from the Notes on issue will be fully covered 1 year ahead of when they are due to be repaid in April 2018.

Net Operating cashflow was over AUD51m (adding the extra cash and repayment of loans), but the quarterly will tell use the full amount as some money would have been spent elsewhere (eg interest payments).

An excellent announcement - but will the market yawn given how far the share price has risen and concerns about a lower AUD POG, at least in the short term? I dunno.

Good luck goldie punters.

loki