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Highlights from the Quest Teleconference  After much hype and anticipation, Quest Minerals & Mining Inc. (OTCBB: QMNM) conducted their investor update teleconference this past Tuesday. All in all, I think the general consensus is that Quest's CEO was quite sincere in his dialogue. For those of you that missed the call, here are some highlights from my perspective:
The Pond Creek mine will soon (next 30 days) be into full production mode (1,500 - 2,500 raw tons per day) and updates will come next quarter. Please keep in mind that, at least to my knowledge, raw tons do not always translate into "marketable" tons. My guess is that 60%-70% of the raw tonnage will be used to fulfill contracts. I will check my estimate with Quest and get back to you all on that.
Chapter 11 - Quest aspires to move out of Chapter 11 in the next 90 days. The CEO seems to be pretty confident that between cash flow from mining operations and money from investors, bankruptcy will soon be a thing of the past. On another note, Management believes that its strategic decision to enter into bankruptcy proceedings for its Gwenco subsidiary essentially kept the company alive and strengthened its position by protecting it from lenders for a period of time and allowing it to begin generating cash flow to help pay back loans.
The Cedar Grove mine will be in full-production mode by the end of 2008. To the best of my knowledge, management expects almost identical output here as at Pond Creek.
Quest expects to be profitable from an operational perspective by the end of the 3rd quarter and also noted a massive increase in interest from private/public investors.
The Stock (Not From Teleconference)
With four consecutive red closes under our belt this week, today is looking like a 5th with the stock down about 11% as of 1PM ET. With no hard financial data to review, maybe investors are still taking profits off the table or just simply protecting themselves from the downturn now that they know production numbers - which should move the stock in my opinion - are still aways off. Remember, many got in below a penny, thus making even $.014 a fairly attractive exit point. Particularly as the stock continues to drop presenting the opportunity for investors to potentially buy back in low before production data is released.
In my opinion, the move upwards just prior to the call may have been some investors anticipating tangible production figures, which will come next quarter as stated above. In the meantime, any positive developments could indeed breathe life back into the stock. Besides production numbers, news on Quest's progress in getting out of Chap 11., hiring on additional workers, reaching full production at Pond Creek, and receiving additional financing should all be forthcoming.
Labels: QMNM.ob, Quest and Coal, Quest Coal, Quest Minerals and Mining Corp
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