Very clearly Wolf have had a big problem with their processing plant involving GRES. Not only is the noise and vibration and environmental problem, but the actual processing plant is not performing as it should. The company has been far too reticent with shareholders. I trust there will be some forward movement from this low point.
It would seem that theyve just spent a year and something like 100m tweaking a new mine and trying to chat over the noise? I invested here some 7 or 8 years ago and have averaged down many times i think there is a chink of light somewhere down pit but that might be the boys breaking through somewhere south of Pilbara............. damn right the contractor who built the bloomin ting should be paying for the rubber washers......... arrrrrgh!
Thanks Iclaude, very informative, and yes, I appreciate ithere are many variables involved.
I was invested previously, but moved on to other things and noticed the current share price is rather subdued, so started looking at when profitability (and dividends) was expected but was having difficulty getting even a rough idea. You have helped enormously, much appreciated.
I noticed the rising Zinc price and have been considering coming back on board, but have been considering how long before the share price reflects the longer term value.
You might ask - how long is a piece of string? There are so many variables in that calculation that it is virtually impossible to give an exact answer. We currently have a rising price for tungsten of US$315/ton; a £55m debt @15% interest (£8.25m p.a); a further debt of A$27m being sought. Negotiations to change debt into convertible loans notes and shares. Current operations work out to have cost A$32.3m for Q1 with profits at A$15.8m giving a loss for the 1/4 of A$16.5m.
The projected requirement for Q2 is A$27m which is A$5m down from the previous quarter. If these figures were sustained for 11 x 1/4's then sustainability should be reached. At this stage we are processing the poorer graded ores, so much more can be expected from future processing of higher grade ores. In addition to this tungsten is traded in US$'s and exchange rates are going to be in our favour.
To my view this is a healthy state of affairs with operational costs reducing and profits reducing debt. The next question is how our financial backers would like debt reduced/paid back. In order to keep investors on board, we must ask when will dividends be considered.
This investment has a long road to run but with less risk. It is not going to be an overnight wonder-share but is a safe harbour in the stormy weather ahead.
Seeing that iii can no longer perform this basic task for paying investors!
30 January 2018
Wolf Minerals Limited
Quarterly Activities Report
For the Three Months Ended 31 December 2017
Specialty metals producer, Wolf Minerals Limited (ASX: WLF, AIM: WLFE) (Wolf or the Company) provides the following update on progress at its Drakelands open pit mine (Drakelands) at the Company's Hemerdon tungsten and tin project in Devon, southwest England, for the three month period to 31 December 2017 (the Quarter).
ü Tungsten concentrate production and sales up 22% and 36% respectively on the previous quarter.
ü Operating turnaround plan activities largely complete and being incorporated into operating practices.
ü Tungsten price improves further, currently US$315 per mtu.
ü Discussions in progress regarding the required further funding support to reach steady state operating cash flows.
Commenting on the Company's recent performance, Wolf's interim Managing Director, Richard Lucas said:
"Another strong result for the third consecutive Quarter as the improvements from the operating turnaround plan are being realised, reflected by a further 22% increase in production and 36% increase in sales. The processing plant performance is benefitting from a more stable operating environment, allowing optimisation efforts to start building upon each other. We expect this to continue with further enhancements to our mine plan, the improvements from the gravity fines circuit and the return to 7 days operations.
Progress has also been made on a resolution to low frequency noise emissions, with input from a team of global experts on noise and acoustic treatments providing a way forward to a positive outcome for our local communities.
The tungsten price has also continued from strength to strength as it again surged above US$300 per mtu both in Europe and China, with tight supply expected to continue supporting prices in 2018.
In this encouraging business environment, the Company continues to receive support from key project stakeholders as it heads towards self-sustaining operations, with negotiations in progress on the further funding required to ensure completion of the successful efforts to date."
There were three lost time injuries during the Quarter (compared to two in the previous quarter). The Company's continuing investment in behavioural based safety is being integrated into the business, with further opportunities for improvement identified and under development.
The net cash used in operating activities for the Quarter was A$8.5 million, including A$3.6 million on development, A$16.3 million on production and A$3.9 million on finance costs, with revenue of A$15.8 million. As stated in the quarterly cash flow report (Appendix 5B), also released today, the Company had A$6.6 million cash at the end of the Quarter, with further funding discussions in progress to support revenue, on a forecast gross cash outflow of A$27 million for the coming quarter. Please refer below for further details on funding arrangements.
During the Quarter, mining activities remained focused upon ore feed blending for the processing plant and the commencement of Stage 3.1 construction of the Mining Waste Facility (MWF).
A total of 597,137 bank cubic metres of material was moved during the Quarter, with the ore grade averaging 0.20% WO3 and 0.04% Sn. The improvement in the processing plant performance has provided valuable information for mine planning on the blending strategy for optimal ore feed quality. A stable operating platform will continue to enhance this process, especially as the gravity fines circuit contribution further improves pre-concentrate recovery.
In addition, following encouraging test work during the Quarter, the Company has initiated a pre-processing trial on lower quality ore feed to identify potential improvements in processing efficiency and proj
Interesting article suggesting the the price of tungsten is likely to stay firm which will be good news for Wolf - https://www.metalbulletin.com/Article/3776086/Tungsten/2017-REVIEW-China-dictates-tungsten-highs-and-lows-but-global-industry-breathes-more-easily.html
Drove by the mine yesterday on our new road and saw a lot of earth-moving going on, landscaping the boundary areas, I think. Latest report from drilling for tin at Kelly Bray appears to be good. The increase in Tungsten and tin prices plus the dollar/sterling situation should boost profits. All of this should bring net profitability sooner than expected.
On 30 Jun 17 the following non-exec directors were granted approx. £3500 worth of shares in lieue of fees and bought £3572 worth of shares to boost their holdings by around 10%:-
John Hopkins (Non-exec. chairman) now holds 1,243,098 shares Valued at £48,480
Ronnie Beevor (Non-exec.Dir.) 804552 shares valued at £20,629
Nick Clarke (Non Exec.Dir.) Total value of £17,727
Donald Newport (Non-exec.Dir.) Total value £17,727
To accept shares for fees must be seen as a supportive action of these directors and to add their own cash must indicate a commitment and support for the future prosperity of the company. It's nice to see and hopefully things can only get better.
Very rarely watch the box that is why I missed the program. Family member gave me the heads up so went straight for I-Player, so definitely NOT faffing around and NO I do not watch the Cardigans, ever.
Yes, I've been overseas for 3 months and when I returned I too noticed a big difference in what has taken place at the site. Looks like a section of new road has been finished down to the bottom end where the spoil water is collected and the whole hillside has been landscaped in keeping with the moorland surroundings.
Announcement in The Western Morning News that Strategic Minerals PLC and New Age Exploration are joining forces to re-open the Kelly Bray Mine in Cornwall as a tin/tungsten mine. An initial £2m is being ploughed into the operation. The mine closed in the 1930's but the world shortage of tin with two months worth of stocks gives reason for estimates that by 2018/19 the price should reach £30k/metric ton.
The Hemerdon Mine has tin as a by-product at present but locals who have knowledge of the area say that there is a lot of tin still to be found there.
This could be the catalyst to set WLFE on its way to great profits
The debt financing is provided by Wolff,s major shareholder who has supported the Company thru thick and thin. I,m surprised it has not taken the Company private before now. There is a very small free float.
Only for the brave ihmo.
According to the latest update, Wolf expects a cash outflow of just shy of 20 million this quarter. There is about 14 million or so of cash and available loan facility. There is a reasonable expectation of improvements in production going forward, but it doesn't look to me like enough to reach positive cash flow without an improvement in the price received. (Sure to happen some time, but maybe just not yet.)
I can't see anything announced by the company about how they plan to meet the financing shortfall. I would imagine they can raise the money, but not without issuing further equity.
Maybe I am misunderstanding something in the announcements.
Can anyone following this more closely than I have let me know why this share is a reasonable proposition at the moment, even at a price under 5p?
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