until the cash runs out, based on 1Q2013 cash burn rates. There is only one way for the company to survive long-term: Issue a series of positive optimisitc news spaced out over a few weeks to drive up the stock price, then print and sell a huge number of new shares, at a discount to the inflated share price. This isn't going to work after they're broke and fired the entire staff. The pump is going to have to start soon, my guess being next week. The key to profiting from an orchestrated pump is to sell your shares just before news hits pricing the massive sale at well below the market.
"Broker just said liquidity among the miners is at all time low."
Your broker means that the miners are running low on cash and they can't get bank loans. Soon they will have to shutter operations.
The Mercantile ExchangeChicago trades over 10 million gold contracts per month. The fledgling Hong Kong Mercantile Exchange has a TOTAL of 200 gold contracts outstanding. 200 is essentially to zero, which is why the HKME is closing. Anyone that thinks this is "huge" is an idiot.
You could say the same thing to anyone that's lost a lot recently in any investment. And why should this particular loser be any more likely to rebound? Just because it's where you lost so badly? Wishful thinking is not a sound investment strategy.
But gold miners can.
The years when gold kept rising, the miners could increase salaries, overhead, and profits too. When gold topped out and started the downtrend, there should have been payoff to trim the fat from overhead. Staff at the miners should have started taking pay cuts. But instead, they got more pay raises. At $1000 gold on the way up, all miners were highly profitable. At $1000 on the way down, several will become cash flow negative. And when the cash runs out?
Operations burned $9.546 million in cash. It's a good thing they got a $10 million loan so they can keep paying corporate salaries for another Q longer. In a single Q all the borrowed money is up in smoke. The cash is gone, now all they have left is the debt. Total cash remaining is $16.294 million, which will keep paying salaries until at least the end of August. But then what? Ordinarily they could issue glowingly optimistic press releases to pump up the stock, then print and sell new shares. But these old tricks won't work now that interest in fantasy gold mines is declining. How ever will they maintain their lifestyles? Poor guys.
If you're going to add saving from re-financing, why don't you also include the effects of higher natural gas expenses and delicing sales prices?
Today's tragedy proves that the stockpiles at nitrogen fertilizer production plants are timebombs waiting to tear our communities apart. They should stop production and sell off inventory until local governments have time to conduct full safety inspections and possibly demmand that the plants be moved away from population centers.
From the 3/28/2013 press release, "significant development commitments will be deferred until market conditions improve for junior gold equities." In other words, in order to develop a mine they need to keep printing and selling more shares, but since nobody wants to buy shares now they need to shut down development. And what happen just as soon as the market for this stock improves? Bamm! New shares are printed and dumped on the market.
Meanwhile, the milling equipment that was bought way back in 2008 is being put up for sale. This equipment was used to entice many an investor to buy newly printed shares. See, we've got the milling equipment, a gold mine must be just around the corner. And five years later? Now they're selling the equipment.
I believe this equipment is carried on the books, so they just got a $10 million loan to cover their salaries until the sale goes through. The lender had great "confidence" in the company because they only charged a 3.5% fee up front ("Here's $10 million, now give us back $350k right away") plus 8% interest. Any shareholder can borrow money under better terms. Confidence.
There will be no mine without further stock sales, and nobody wants to buy more stock. Ergo, no gold mine.
It's amazing how some people only see what they want to see - reality be damned!
Are we still on for $1.11? Can you do 250,000 shares? Neither of us wants to tip the market with a large offer, so let's pick the date and time. I'll offer 1.11 for 250,000 shares and you can short the market down to that point getting all of the standing retail orders along the way. How about Monday at 9:30?
C'mon Billy, how long does it take you to get ready? What time today are you going to take it down?
I'd like to buy 100,000 shares today. Would you be willing to sell it to me for yesterday's close of $1.11?