The Knowns----------We know forecast cash-out for September qtr...

The Knowns
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We know forecast cash-out for September qtr was to have been $17.5m, as this was disclosed in the latest cashflow statement.

We know that this forecast understated cash-out by $390K + cost of pit re-design, as this was disclosed in the CEO announcement of 21/8.

We know that we started the quarter with $6m, so we needed to make at least $12m in silver sales to not run out of cash. Even at an avg AUD silver price of $28 / oz (generous), we would need to sell 428koz in the Qtr.

We know production for July was to be 115koz (latest activities report), leaving approx 160koz per month for August and September.

We know that the ball mill was operational in July and that we had a stockpile of oversize material, but we could still not deliver nameplate capacity.

We know that finance payments recommence in the Dec-qtr, and that a lump sum of $2.5m is due to the bank that quarter.


The Guesses
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I reckon maximum production for August and September was going to be around 150koz, based on the CEO's "moving toward 200koz" comment, and the scheduled down-time in September. I reckon that for each day past month-end that CCU does not report on production, you can probably subtract 3koz from the 150koz/month guesstimate.

The fact that CCU has disclosed what it has, makes me guess that it will run out of cash (again).

The fact that it hasn't announced another capital raising, makes be guess that its beholden to the bank. The reason for this is that a capital raising will not be possible unless it is accompanied with an explanation of how the cash will be used to deal with loan and interest commitments.

I suspect that the CBA has CCU by the proverbial .... It will wait and see what happens when the new retort is installed and then it will make CCU an offer it can't refuse. It will be presented to shareholders in the usual gun-to-the-head manner that is typical of the Boards of failed companies ... "take the CBA deal, no matter how dilutive it is, otherwise you will end up with nothing".

Hope I'm wrong as I would love a leveraged-to-silver play, but until the CCU mine has actually produced 200koz in a month, I can't believe any more forecasts at that level.

GLTA.