Why this could be nothing short of MONUMENTal!

It's Good Friday, and I thought I would try to share something good with you.  I was thinking of profiling one stock, but have had another pop up on my radar via other methods.  You see, I look at a lot of juniors.  Some I get from news releases, some I get from charts, some from publications, and some from "other" sources.  Consider this an "other" source.  It's not insider trading info, so don't worry about that.  I keep my ear to the ground....and sometimes I do hear "rumblings".  I heard a rumbling earlier today which lead me on my somewhat wild goosechase.  Granted, it took me awhile to find it, but I do think I've discovered something...MONUMENTal.

My new suggestion (as they are all just suggestions for you to further investigate) is a junior gold producer.  Yeah, that's right, I said producer.  They are pouring the dore as I type.  Although it's 11 pm here, it's all the way around the world, so it's probably daytime where the mine is.  They started out small, and have produced 1,400 ounces in their first Q of operation, 4,100 in their second Q of operation, 8,200 in their 3rd Q of operation....and finally 11,348 in the last Q of published results with a total cash cost of....wait for it....$265 an ounce.  So, not a huge amount produced, but not a real large cash cost per ounce either.  And get this.  They actually have earnings.  Net income was $5.4 million and EPS was 3 cents per share.

Drum roll please..........not yet.  You didn't say the magic word.

Here's a press release talking about future increases in production.  Read it and don't be lazy.

Production Increase Planned

Having successfully reached commercial production with its 400,000 tonne per annum gold treatment plant and building cash reserves, the Company will commence construction of its planned Phase III expansion to lift the gold treatment plant capacity to 1,000,000 tonne per annum.

This 250% expansion in production capacity will be funded from current cash reserves, is expected to cost less than C$8,000,000 and will result in a projected pay-back of 3 months from operating cash flow. The expansion is scheduled to reach practical completion by the end of calendar year 2011 and be in full operation by April 2012. 

There will be some disruption to the present operations during construction and commissioning of the new equipment, however the Company projects gold production will remain at 40,000 ounces of gold for year ended 30^th June 2011 and increase to no less than 50,000 ounces per year for the year ending 30^th June 2012. The company will make further announcement on the projected gold production targets from June, 2012 onwards pending plant commissioning and the 2011 exploration program resulting in a new reserve and resource statement.

The development and construction of the current mine and processing facility has shown the Company has built the capability to design, permit and construct low cost and efficient treatment facilities. This owner capability will be utilized to project manage the Phase III expansion.

General Manager, Kevin Wright who oversaw the construction of the existing mine and mill stated "this plant will not only provide an increase in production capability and operating efficiency but will also provide necessary operating flexibility for processing blended feed as the operations mature. Extensions to the ore zones identified by our exploration efforts along strike and down dip are likely to produce an increase in variability of ore types and our in-house design team has taken this into account".

How bout we do the chart next?  Why not?

As you can tell by the chart it's Monument Mining.

They are a miner who operates in Malaysia and their costs are extremely low.  When you have cash cost per ounce of less than 300 and gold is selling for around 1,500, that's pretty good cash flow.  You can fund a lot of exploration, pay down any debt, etc...

The one stinker on their FS that I did find was that they do have a gold forward in place where they have hedged 5000 ounces of gold to be delivered at a price of $1,000 an ounce.  If you look at their income statement, you will see that they lost almost $4 million on this thing in the last quarter.  Meaning, they could have had earnings of close to 10 million without it.  Something to keep an eye on.

Looking at earnings though, let's say the earn 3 cents a share each quarter for a year, then annual earnings around 12 cents a year, so PE of only around 4 at current prices. 

You can see though that they are adding another milling circuit in order to increase production in 2013 to between 70K and 100k gold ounces.  This year's projection around 40 K, next year 50K, and the following year 70-100k.

Two things I really like are the low cost per ounce and the fact that they got this mine up and running in a short period of time. 

Here's the links to the current presentation:  http://www.monumentmining.com/main/?en&corporatepresentation

And the most recent MD&A that has selected FS date:  http://www.monumentmining.com/main/?en&financialStatements  To get the full FS, go to SEDAR.com. 

I have a suspicion that volume could be somewhat heavier on Monday or Tuesday as I will be buying!

FD:  I have no shares in Monumental Mining (but plan on buying on Monday), and I have not been paid by any parties for writing this article.

Now for my own shameless plea:  If you like anything I have written, please forward my website to a friend (or enemy) who likes this sector, and enjoys a good read.  I only make a very small amount of $ from people clicking on ads on my website.  I have made a whopping $10 so far.  I'm not complaining, but if you break that down in terms of cents per word...I make very little.  I only buy beer with this money as to help me stay up late and write articles.  More than getting piddly money, I really enjoy seeing the counter go up on my blog, so share with a friend, put a link on your facebook page, etc...  Done with my mini-plea.

Until the next time...

Fiat Doubter

All of my posts can be viewed at www.beforeitsnews.com as well as on my website.