No question that the POS has a direct, material impact on CCU -...

No question that the POS has a direct, material impact on CCU - but currently, only considering the POS ignores the elephant in the room.

Until CCU gets close to or above nameplate capacity, the POS only determines the speed at which it runs out of cash.

We know July production was 115koz and we know that August and September will be below nameplate capacity (for what its worth, I'm forecasting 150koz / month for Aug and Sept - which may be generous but who knows) and 200koz/month thereafter (ditto).

On this basis, even at AU$27/oz, CCU runs out of cash this quarter. Based on CCU's estimated Sept-qtr costs, an AUD silver price of over $30 would be needed just to scrape through, and it would then still be confronted with the $2.5m debt repayment due in the Dec-qtr.

So what of the "Options to Improve Working Capital" ....

Given that CCU's cashflow problems are known, and that its now probably too late to address this with a capital raise (I suspect management correctly feared that it would have failed given how many times its had to do so before, and the close proximity to the last one), what other options does it have?

Convertible notes issued to Magna?

Further deferral and extension of debt facility with CBA?

Any other ideas?

I have a bullish view of silver, but a far more bearish view of being beholden to a bank .... The ongoing uncertainty is only going to put further pressure on the SP, regardless of the POS.

I'm not sure that the new CEO's strategy of telegraphing the problem without presenting a solution was the best approach.

(And in case anyone is wondering why I still have a position, its much smaller than previously, and I keep a few in case a SPP is offered that I may find attractive).

GLTA.