Nothing wrong disagreeing Inventory reduction of 45 m (in same...

First 35 Last

Share
Profile

Follow
Autosime

15,774 Posts.

268

30/06/17

07:41

Post #: 25580064
Share

Originally posted by Djingo ↑

Auto

I generally like your posts and this debate has helped me to develop my thinking on GRR but I fundamentally disagree with your analysis on this occasion.

For anyone that it interested, here is my assessment.

For a start, look at how the balance sheet changed over 2016.

Current Assets – Increased from $230m to $232m

There was no material change in CA. Although inventory decreased in value by $45m, this was off-set by increases in cash and term deposits of $29m and trade receivables of $21m.

Current Liabilities – Decreased from $37m to $36m

Again, no material change. Notable changes are borrowings increasing from $5m to $6.5 but tax liability decreasing by $4.2m.

Non-Current Liabilities – Increased from $58m to $60m

Increase in provisions of $7m (relating to employee costs and remediation) offset by $5m reduction in borrowings.

Non-Current Assets – Increased from $112m to $196m

The $84m increase in non-current assets is the key to understanding what has been happening with GRR. Given that liabilities were relatively unchanged and total borrowings reduced, the $84m investment in assets could only have been funded through operating cash surpluses (in fact, according to the financial statements, operating cash surplus in 2016 was $122m).

The increase in net assets is primarily attributable to a $41m increase in plant and equipment (mostly relating to the new mill and tailings storage) and a $46m increase in mine properties and development (relating to deferred stripping). The large investments in plant and equipment should now be coming to an end and will no longer be such as large drain on cash flow. The capitalisation of deferred stripping costs is more concerning but, if accurate, this should be less of a drain on cash as they gain access to the ore body in the north pit.

So the 2016 results show us that GRR is capable of generating substantial cash surpluses at an IO spot price below US$60. Obviously the results for the first six months of this year are going to a shocker but, looking forward, if the stars align GRR will be banking loads of cash.

Expand

Nothing wrong disagreeing
Inventory reduction of 45 m (in same report you read ) capatailised expenses 46 m . There is most of your 122 m cash flow
Cash costs of 79 dollars - read what it excludes and then you will surely get the picture . Excludes sustaining capital , royalties and many other real expenses. Add at least 15 dollars to c1 costs

You boast about the 8 earnings per share last year but avoid mentioning the 24 c. Loss and 9c loss the year before

GRR Price at posting: 12.0¢ Sentiment: None Disclosure: Not Held
1 Upvote

0 Great analysis

Reply

Top Stories

Ice-cold winner: Cryopreserver Vitrafy escapes November's IPO struggles to end debut week higher

HotCopper Highlights: Your most watched stocks for Week 48, 2024

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

ADD

Parkes Au-Cu project to 'transform' Adavale Resources with key targets

RSG

Resolute shares bounce back as second payment made to Mali government to secure workers' release

Week 48 Wrap: ASX flirts with 8,500pts; APRA declines mortgage loan easing; Trump's Bessent tied to Dem donor

MIN

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

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

Dale Gillham's weekly wrap: Bold moves in NZ, caution in Australia

There are more pages in this discussion • 17 more messages in this thread...

First 35 Last

Add GRR (ASX) to my watchlist

(20min delay)
Last 25.5¢		Change 0.000(0.00%)		Mkt cap ! $266.1M

Open	High	Low	Value	Volume
25.0¢	25.5¢	25.0¢	$88.75K	350.4K

Buyers (Bids)

No.	Vol.	Price($)
4	20287	25.0¢

Sellers (Offers)

Price($)	Vol.	No.
25.5¢	160142	7

View Market Depth

No.	Vol.	Price($)
8	219779	0.270
9	458580	0.265
26	932290	0.260
7	172530	0.255
22	717920	0.250

Price($)	Vol.	No.
0.275	405759	8
0.280	942702	17
0.285	372332	13
0.290	1710676	31
0.295	651900	8

Last trade - 16.10pm 29/11/2024 (20 minute delay)

GRR (ASX) Chart

Nothing wrong disagreeing Inventory reduction of 45 m (in same...

Top Stories

Ice-cold winner: Cryopreserver Vitrafy escapes November's IPO struggles to end debut week higher

HotCopper Highlights: Your most watched stocks for Week 48, 2024

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

Parkes Au-Cu project to 'transform' Adavale Resources with key targets

Resolute shares bounce back as second payment made to Mali government to secure workers' release

Week 48 Wrap: ASX flirts with 8,500pts; APRA declines mortgage loan easing; Trump's Bessent tied to Dem donor

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

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

Dale Gillham's weekly wrap: Bold moves in NZ, caution in Australia

Buyers (Bids)

Sellers (Offers)