Business Study Report: E2 Metals Limited - Analysis and Evaluation

This business report provides an in-depth analysis of E2 Metals Limited, an Australian mining company focused on gold and silver extraction. The report begins with an overview of the company, including its location, business type, products, and target market, along with a discussion of its main competitors. It then delves into the production costs and scale of E2 Metals, differentiating between fixed and variable costs, and the mining processes employed. The report further examines the macro business environment, including government policies, economic conditions, and the company's international trade activities. Finally, the report explores E2 Metals' sustainability practices, including the environmental and social impacts of its operations. The report concludes by highlighting the company's strengths and weaknesses, and providing suggestions for future improvements. The report also examines the economic and social impact of E2 Metals on Argentina and other regions.

Business Study Report

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
1) Overview of business..............................................................................................................1
2) Production costs and scale......................................................................................................4
3) Macro business environment..................................................................................................6
4) Sustainability practice of the business....................................................................................7
CONCLUSION ...............................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
In present time, business is characterized as the valuable economic activity that help in
providing a wide platform so that goods and services are exchanged for sufficient consideration.
It comprises all those operations of which the sole purpose is to immediately make easily
accessible to culture the required goods and services (Thomson, 2015). Suppliers, customers,
government, economic conditions and some other variables are the forces that make up the
business environment. In this report, E2 METALS LIMITED has been selected 2005. E2 Metals
is one of the leading Australian exploration and production firm centred on promoting the
Neavesville epithermal gold and Silver Project, that is situated in New Zealand's North Island's
Huaraki goldfield.
In this report, business location and type, various product that are sold by company,
potential market, respective customer and other crucial factors. In addition, the corresponding
organization's manufacturing expenses and scale will also be recognized. Finally, report would
be given to understanding business organization's macro-environmental variables.
TASK 1
1) Overview of business
E2 Metals is an Australian mining company that is focused on creating new attempt in
the world class Santa Cruz gold and silver province within southern Argentina. The company is
located at level 4, 100 Albert road, south Melbourne Australia. The main business of E2 metal is
related with mining that have main of extracting gold and sliver, such as Santa Cruz is a fairly
fresh region from Cerro Vanguardia that reported first ever output of silver in 1998. Hereafter,
Santa Cruz was regarded among the most favoured mining locations in South America, with the
state allowing seven fresh mines in the region across the previous 15 years (Sekaran and Bougie,
2016). E2 Metals regulates a significant strategic grip on the mineralization pattern of Mount
Hope, situated across the southern border of Cobar Basin. It is near to the Southern Nights and
the entire finding was completed by the end of November 2018 by Peel Mining Limited. The
portfolio involves the developed initiatives of Conserrat, Sierra Morena, Angostura Corona and
previous phase initiatives in the neighbouring county of Rio Negro consisting of uncovered
epithermal gold and silver deposits but without previous excavation.
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The main buyers for the respective organization are manufacturers associated with
making gold jewellery products and government also maintain some part of gold and silver
extracted from mine as they give permission for mining after making agreement for companies.
In addition, new business firm also uses mined gold and silver extracted by corresponding
organisation so that general public are easily able to get different gold and silver goods (Ritala
and et.al., 2018). There are number of competitors that are engaged in the same activity related
with mining such as Rio Tinto, BHP Billiton.
BHP Billiton, based in Melbourne, Australia, is an Anglo-Australian large corporate
mining, metals and petroleum corporation. The business aims at attracting, employing and
developing employees with outstanding abilities that share the same key principles. Becoming
one of the leading authorities in promoting miners to expand their capacity and use their
functional knowledge to assist deliver the approach of the company and add to its long-term
future. On the other side Rio Tinto, a British-Australian global metals and mining company,
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focuses on discovering, mining and handling the mineral assets specializing in iron ore,
aluminum, copper, power and diamonds.
BHP Billiton has its headquarters situated in:
1. BHP Group Limited: 171 Collins Street Melbourne Victoria 3000
2. BHP Group Plc: Nova South, 160 Victoria Street, London, SW1E 5LB
3. BHP Billiton Marketing Asia Pte Ltd: 10 Marina Boulevard, #07-01, Marina Bay
Financial Centre, Tower 2, Singapore 018983
Rio Tinto Plc has following headquarter situated at:
1. Rio Tinto Limited: Level 7, 360 Collins Street, Melbourne, Australia 3000
2. Rio Tinto plc: 6 St James's Square, London, SW1Y 4AD, United Kingdom
In Australia and other part of world there is inelastic demand of gold and silver is
observed since it seems to be significant source for jewellery maker so that they can maximize
profit. In addition, it has been noted that there is vast increase within the use of gold and silver
product that help economy to grow in accessible and reach the defined targets. This is mainly
notices due to changes in the need of people and local government as they prefer gold the best
ways to maintain reserve so that tough situation can be handled. It is one of the main activity in
some countries like China, Africa etc. With number of uses but only a limited quantity of gold in
the globe, supply and request factor legislation substantially contribute to gold price
determination. Understanding when to purchase gold at the highest rates therefore involves
monitoring the available variations (Napasri and Yukongdi, 2015).
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2) Production costs and scale
Production simply relates to process which are dedicated to combine distinct material and
immaterial inputs to produce outputs for ultimate use or consumption. It is systematic set of
activities includes creation of output, goods that have some value as well as contributes to
individuals' utility. In manufacturing concern like E2 metals production costs are classified as
variable and fixed. Variable costs are cost per produced unit which varies with change in
production units. While fixed production costs do not change with change in production level.
In this context E2 metals corporation using productions and mining processes for
extraction of gold and silver. Here fixed factors are mainly associated with heavy machinery and
other essential products like fixed rent of any rented machinery. Whole process of mining starts
with extraction, crushing, segregation of materials and ending with logistic functions to
accomplish production task to get ultimate products. In company open-cut mining technique is
used to produce or mine gold and silver is majorly adopted (Murphy, 2017).
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Company is mainly operating for two large projects: Cobar and Santa Cruz. Here one or
more factors which contributes in making these project as an opportunity. Company is operating
through different mining units which are key aspect of entire mining project. Here identification
of fixed variables is significant for better management of production costs. Given that complete
set expenses are not altered with enhanced production, the graph is plotted in horizontal line
compared to upward curve, which shows complete variable costs. Full variable expenses in
upward slope display the rule of decreasing marginal incomes. Full fixed costs have been added
to total variable costs for calculating the complete costs (Hawking and Sellitto, 2015). Analysis
of manufacturing costs can also include average fixed costs and variable cost averages. The
entire fixed expense is split by production to measure average fixed cost. An rise in
manufacturing represents an average downtrend in fixed expenses, thus a downward path in
curve. Dividing aggregate variable expense by production is computed on average. The graph is
U-shaped, since it demonstrates a descending drop before it hits the lowest possible point, on
basis of ratios, before it increases again. Several labor issues are confronted, mainly because
locals residing under Argentina do not receive proper education and training to carry out all
operations linked to the company. Furthermore, the required business goal is accomplished
with adequate effectiveness before hiring individuals through the appropriate training and growth
programme. Argentina is main area for mining gold and silver from southern half of South
America. About three billion tonnes, as previously recognized, of gold and mine bearings. In
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addition, Argentina has been found to be the world's biggest gold and manufacturing region.
There are a number of gold and silver rocks in this area. Fixed production variables are big and
cost enormous to keep every factor efficient. However, company size is feasible and needs a big
quantity of perfect resources to demonstrate productivity in companies.
3) Macro business environment
Macro business climate is the set of external variables that are inherently unmanageable
by management. These variables have a great impact on decision making and have an impact on
company rules and techniques (Eriksson and Kovalainen, 2015). It mainly includes legal,
demographics, technological political and other variables that are related with externalities of
business. In Australia government strategies carry in a single-party dictatorial democratic
government. Moreover, in following years, Australia economy has undergone continuous
improvement, with transfer payments from international sources that have being valued at
around 32 percent of gross national products. The main operations of company are in different
countries such as South America, Argentina and Australia. In 2018, the real inflation rate
detected in Australia was reported at 9%. Although in Australia, gross domestic product was
estimated at about $6.72 billion and general valuation constitutes 0.01% of the global GDP.
Australia's rate of inflation showed a increase from past years as it was 1.6 percent during the
year 2019. In addition, customer prices grew by 0.6%. Australia's inflation rate averaged
approximately 4.97 percent from 1951 to 2019. The GPD level was $270,104 million, and the
annual ranking of Australia in recent year is 13. Thus it has been stated that economy is evolving
and multiple operations are being carried out to possibly expand in the marketplace.
In order to achieve the required company goal with effectiveness, E2 Metals exports its
goods of goods and silver to number of other nations. As the corresponding business company is
registered on the Australia stock exchange, all financial transactions and exchange of currencies
with prospective clients are carried out in AUD that are widely acknowledged. There are
numerous problems that E2 Metals ultimately faces while mining variety of silver and gold
product. To extract an enormous quantity gold company required qualified and well-trained
workers those are essential to run different operation. In addition, high employee turnover is
extremely that affect company activities. In the framework of E2 metal, the unemployment rate
in different part of Argentina is very huge (Buehler and Hamre, 2015). This is because
individuals are poorly educated and untrained to give their best practices in mining activities. E2
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Metal main brand is gold and silver that is marketed in many areas of the globe. Therefore, Sales
of the corresponding item are very much essential to gain the desired results. Gold is essentially
the inherently valuable product and is mainly used to make number of items such as jewellery,
ornamental etc. the other product silver is also used to make jewellery product, coins, vessel,
panels solar and cell phone. The financial requirement for gold and silver will never be impacted
during the crisis era as these are one of the most valuable cost-effective and extremely suggested
powerful natural resources.
The respective firm is involved in both exporting and importing products to another
nation from one portion of the nation (Aguirre and Rodriguez, 2017). Company exports gold and
silver to significant areas of the globe that further support the several production function and
strength the are imported from distinct nations. E2 metal monetary payment take place in AUD
dollar that help to make consideration for exchange rate as it can be substantially noted that the
subsequent institution earns decent amounts of profit by exporting its products and services to
other areas of the globe.
4) Sustainability practice of the business
Externalities of production are generally measured by the variation between current
actual production costs and production expenses incurred in society. In addition, the effects of
external manufacturing may be positively and negatively (André, Cho and Laine, 2018).
Argentina's long-term capital gains have been greatly affected by Santa Cruz and Cobar.
There are many different jobs and possibilities for growth of skills accessible to local populations
and Argentina as a result of the initiation of Sana Cruz and Cobar in Argentina. Thousands of
permanent employment have been created for citizens of Argentina. E2 Metal Limited and the
Argentinean Government are focused on the general growth of the prospective stakeholders of
company and their corresponding national economies in sustainable and economic development.
Furthermore, Argentina is kind of prosperous nation that is concentrated and goals at capitalizing
on Santa Cruz and Cobar and has a significant effect on infrastructure support. The respective
organization, through which the project is successful, is secure, stable and developmental. In
order to perform company activities with complete effectiveness, the Government of Argentina
focuses on many elements. Several of the prevalent fields of government are: environmental and
food safety, growth of human resources, growth of infrastructures, education and many other
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fields. E2 Metals Limited has both powerful and efficient working interactions with government
of Argentina.
In order to formulate general plans for the Santa Cruz and Cobar potash projects, the
Santa Cruz and Cobar Potash project have been extensively consulted with local societies. Long-
term learning for practitioners and businesses is carried out to achieve a major worldwide
success for the corresponding project. In making Santa Cruz and Cobar profitable, the approach
taken by the Argentine government is unusual. E2 Metals Limited usage of products produces a
beneficial effect on general externalities (Aleyan and et.al., 2018).
The positive effect is seen in infrastructure, employment development and taxation on
general economy. In addition, multiple social advantages are determined by this. Most popular
ones are: the formation of employment for individuals in Argentina, skill growth, infrastructure
enhancement-highways, water and energy, and local companies. Multiple strategies to achieve
sustainable growth in company are being introduced. The reforms, governance and tracking
proposals are: civil rights, communities, extremely pro-corruption, etc.
CONCLUSION
From above study it has been articulated that business analysis and evaluation of trade
environment is significant to determine corporation's status in industry. In addition, the company
climate has a major effect on the general functioning of an organization. This factor could be
inner or external influences, which should be analysed promptly in order to make precise
improvements. While it can be recognized that the unemployment and gross-domestic growth
affects strongly a corporation's business condition with micro-environmental variables for the
economic process of business enterprise. In order to effectively conduct all company operations
with complete effectiveness, the organization is also adopting multiple sustainability practices to
achieve its goals within a specified time span.
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REFERENCES
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