Replies to post #30462 on Value Microcaps Junior Miners

[checkmate28]

BRD.v Whats not to like. 100k producer with upside, increasing operational efficiency on both the tech and financial side.

Safe jurisdiction separates it from most of the other comparable bargain producers with similar market caps.
CM 28

[dr_airtime]

BRD.TO - Highlights from Denver Presentation

All points below per CEO in presentation unless otherwise indicated.

My thought-->Drag on SP is $50M of convertible debt + $28M of senior secured notes + options. Options at SP that is way too high so non-dilutive over next two years.

Guiding for 100k+ ounces in 2014 at $650-700 cash costs and $1100 AISC. Free cash flow of $40M in 2014 at $1325 gold price. Will repay $17M of debt (senior secured notes) in 2013.
Scoping Study (PEA) to be released at Grey Fox in coming weeks. Production, tonnage, cash cost metrics will be identical to Black Fox.

There was flood in Q2 and they took environmental precaution and shut down. Despite that they produced 49k ounces in H1.
Sandstorm has 8% goldstream on Black Fox. 8% of production @ $400. No goldstream on grey fox. This is reason for production drop-off.

CEO said they expect to be at upper range of 95-105k oz produced in 2013. The 95-105k is also a mid-year guidance increase so good year for Brigus on paper (likely high grading with low POG)
3 years of open pit reserves at flagship Black Fox.

My thought-->In the absence of more ore from new Grey Fox discovery they would not of been able to maintain their 3 successive quarters of lowering cash costs.

Per CEO, open pit reserves last through end of 2016. They are currently mixing open pit ore and underground ore from Black Fox.
CEO expects grey fox to be well in excess of 1M oz once drilling campaign complete. They now have permit to go underground at Grey Fox.

Conclusion: They will be able to operate at 100k/year for many years going forward. Mill commissioned and little downside to current share price with dropping AISC (all-in-sustaining-costs.)

They bought the Saskatchewan goldfields project for $10/oz in financial crisis. It is fully permitted and has a pre-feasibility study.

My thought-->This will be a future mine but for now they are focusing on Black/Grey fox. They need to get everything humming there so they build up a cash balance most likely and at least try to debt finance $200M of capex.