Dr Air Re ORV.T ORVMF Orvana Minerals
ORV.TO I'm not that keen.
I sold all mine when they announced $1350-$1400 AISC for F2017. Current rally is low volume and won't hold IMO. They are at AISC of $1422 YTD so are over upper end of guidance and will bleed cash this year.
CM The 2017 AISC Guidance is not whats important. Whats important is the resulted efficiency that will come from the CAPEX going into the rehab. This CAPEX distorts the AISC in H1 17" heavily negative,
CM H2 will see large increases in production and decreased costs, plus continued outgoing CAPEX for the rehab program. Q3 ends June 30 and new guidance will be out soon for 2018 that begins on Oct 1st. They will have paid the entire BISA $8M loan by then. In Bolivia, Operating CC should be running $700 and AISC near $800 NOW. Perhaps you missed the 14 Million lbs of copper plus silver credits per year? Progress will be slower in Spain. Increasing production volume with decreasing costs due to the increased oxide ore will increase over a number of quarters. A couple years worth of available tailings should help to keep the mill at current 2000tpd which is up from about 1200tpd last year
Bolivia is also really small and I'm not sure if they have ever been able to repatriate free cash flow so that is why market gives them no value (socialist country that market is highly suspect will honour current mineral resources extraction legislation long term - I've visited there) so may be just a capital-suck to keep extending mine life but never helps to generate cash.
CM Remember they have operated in Bolivia with no real problems for 20 years and have traded at $8/shr and more recently for $4/shr in 2011. I'm the first in line to worry about jurisdiction. (I prefer Timmins ON). When I discount 50% for jurisdiction and still see huge value with low downside, I buy it. Market giving them no value because they came from life support. They will buy Bolivia again when the cash starts stacking
ORV may wander between $.20 and $.40 for next six months but I don't see any bigger catalysts.
I'm watching but waiting to see if FQ3 or FQ4 come in at lower AISC.
I know it's still cheap but needs a real turn around. I would buy again if ORV went back down to $.20.
CM Orvanas not going back to .20 Somebody would be lucky to get a worthwhile position under .28 IMO
CM All in all, the play was to buy at .20 this year and catch a sure slow ride up as they prove the value. Each time you wait for proof of catalyst, you loose most of the upside value for that catalyst. Buying near .20 with wanderings to .40 as you say, is a great proposition in this years lethargic, market. The trick, is to know what they are going to do upfront, get in early, be ruthless with the DD and wait. The only thing going to slow this stock down, is the ongoing CAPEX that affects the distorted reported AISC. Remember the CAPEX is expensed here. Its paid for with a combo of CF & debt service. Much better than the costly dilution and loaded financings the rest of the pack offers. Many will see through this AISC. In 60 days when the financials are out, you'll by buying value at .40 cents. The big gains will come shortly after, when the balance sheet is cleaned up, production is humming at 130k AuEq/year with a much lowered AISC.
Just my opinions of coarse.
Checkmate28
