Aeris Resources Limited [ASX:AIS] dropped by 16.67% early this morning. The mining company couldn’t avoid the market crash, even though other mining organisations were able to maintain a steady hold of their stock value.
Aeris Recourses market cap now sits on $14.012 million, standing at roughly $0.120 share price.
Everything was looking up for the mining organisation, as they have been seeing successful results all throughout 2017.
In December they released their quarterly earnings, displaying that their performance did increase throughout the final month of 2017. Copper production was up by 6,465 tonnes, and displayed a much higher turnover for ore.
How were they unable to avoid the market crash?
The sudden crash took a lot of companies by surprise, especially Aussie organisations. And Aeris have been focusing a lot on spending rather than saving.
The Australian mining company have placed a heavy focus on exploration and surveying and are still paying off their Working Capital Facility debt.
Exploration and surveying costs money, combined with the looming debt, this deters any efforts to save money at an efficient basis.
This is a frequent trend amongst many gold and palladium mining companies. In order to make money, one must be willing to spend.
To make matters worse, a pipeline accident occurred during the early days of 2018. This resulted in a small spill in mine water, affecting pipeline routes and put a slight halt to productivity.
What does 2018 have in store for Aeris?
The Torrens Project is a joint venture between Aeris and Kelaray. It is one of Aeris’ main projects which focuses on exploring copper and gold prospects in South Australia. While being approved by the E-PEPR and government branches, the project is moving closer to becoming drill ready. Matters with indigenous communities still needs to be resolved to finish off the exploration progress.
Aeris does respect the value in heritage sites, but new heritage agreements may open up new areas for Aeris to explore.
Exploration of these areas has been suspended for almost 10 years, but with new laws being put in place, this could change to grant more freedom to Aussie mining companies.
Overall, this drop should not affect Aeris too much as they hold a strong standing in the ASX. Future projects should see them through any hardships they may find themselves in.
Publisher, Money Morning
PS: Mining is such a large platform when it comes to shares and market rates. Gold in particular has always been a popular one. Jason from Money Morning has constructed an informative piece titled ‘The Right Time to Buy Gold Stocks in 2018’. Which outlines key information when it comes to investing in gold.