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sortagreen

06/10/05 8:21 AM

#7 RE: OriginalFred #6

Fred no, not those shares. They would have been unrestricted 6 or 8 months back. There were two rounds of private placements in Feb and March that will come off restriction in June and July. They went out at .25 and .50, and were used to finance the company's reorganization.

All told there were 15 million and 14 million shares in the two PPs. Total shares are 86,556,877 now and there are also about 14.5 million warrants out there. Fully diluted it looks like 101 million shares.

Now the good news.
*No debt.

*Company produces 400,000 Metric Tonne Units (MTU) of ore each year at $60 per MTU. Current price is upwards of $220. 70% of the offtake is under contract with a floor of $100 and some discounts built in after that, so that it looks like $200+ per MTU. 30% is reserved for the spot market which has been going ballistic lately. Free cash flow looks to be

****400k x ($200-$60) / 101mm shares = .55 per fully diluted share ...or more depending on market conditions.

*An APT plant(ammonium paratungstate, a downstream tungsten product) could increase this significantly... Though it's not in the works right now, it's been talked about. Company owns a process patent of some sort.

*world-wide tungsten shortage with no easing in sight makes this situation unlikely to change for the worse.

*Company's known resources add up to 15% of world reserves.

*other large scale deposits, notably Tiberon's Viet Nam project are more than 2 years out.

*US strategic stockpile seriously depleted.

*Indian and Chinese industries are a huge and growing customer base (as they gear up to take the last of America's jobs) China has gone from net exporter of Tungsten to net importer.

As far as the restricted shares go...The holders don't necessarily dump them. No one thinks this company is going anywhere... It's not a dilution machine as it has raised all the cash it's going to need.

Clear sailing to $4 or $5, maybe in a couple of months, realistically..let's see what happens from there.

There's my seat of the pants SWOT (strengths, weaknesses, opportunities, threats), just like in school. Didn't realize I was doing it til I got finished. I'll post a couple of current and back articles now.