Was doing some amateur analysis to work out how long it would...

Was doing some amateur analysis to work out how long it would take for CCU to repay its outstanding debt. Feel free to point out if I got anything wrong.

Assumptions:

1. Silver price averages at $24

2. CCU achieves nameplate production consistency at 200k oz per month

3. CCU does not take on more debt.

4. No further private placement / public offering (This is of course a big assumption considering the meeting going on now ... )



Analysis:

Current quarterly cash outflow:
$13,686,000 ($22.81 / oz @ 600,000 oz)

At current silver price of $24.00, it would take 9+ years to repay its outstanding $28m debt

Targeted quarterly cash outflow:
$11,400,000 ($19.00 / oz @ 600,000 oz )

At current silver price of $24.00 : 2+ years to repay its outstanding $28m debt


Conclusion:

Getting cash cost down to the targeted $19 this year, and maintained over the next few years, can allow CCU to be debt free by 2016/2017.


Discuss...