Grandich Client Crocodile Gold

I’m not surprised by today’s press release announcing the appointment of a new President and CEO, Chantal Lavoie effective June 17, 2011 who will replace the present CEO Mike Hoffman. At best, one could blame some factors outside of management’s control for what has occurred but to say they get an entire pass would not be truthful. One can debate if Mr. Hoffman is taking one for the team or not, but in the end it was needed. Mr. Lavoie appears to have a strong mine operations background with recent experience at De Beers and Barrick Gold. It appears the transition is being done as well as it can with Mr. Hoffman staying on as a Director of the company and agreeing to assist in the transition and investor relations to the end of 2011.The desire here appears to be to have this take place in the least disruptive manner possible.

In the press release Crocodile Gold announced they met their 1st quarter guidance of 14,000 to 17,000 ounces by producing 14,680 ounces. I would expect cash costs to be high and even above the price of gold due to lower production. 1st quarter results are expected to be released in early June

Crocodile announced the first ore crosscut has been reached which is a good sign and that the performance with the new contractor is proceeding as planned.It’s a positive that they are optimizing their existing design and have brought in some competent people to assist. It makes a lot of sense to take a more conservative approach when starting a new mine which appears that they are finally doing.

They have:

• $80 million in the bank.

• A new top man.

• Cosmo appears now to be okay.

• They are in the dry season.

• Production has returned to normal

• They are aggressively exploring.

We need to see a real turnaround going forward ASAP.

This entry was posted on May 17, 2011 at 8:54 AM. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.