Monday, December 11, 2017 7:48:52 PM
2.
Going Concern
The Company’s cash flow is directly related to revenues generated from production and milling activities. The Company has experienced operating losses and negative operating cash flows prior to and during the ramp up of production activities at the Golden Chest Mine. In addition to cash flow from operations, ongoing operations are dependent on the Company’s ability to obtain public equity financing by the issuance of capital and to generate profitable operations in the future.
The Company is currently producing from the open-pit at the Golden Chest Mine and began underground operations in early November 2017. In addition, during the first three quarters of 2017, production has generated positive cash flow of $231,785 and planned production for the next 18 months indicates the trend to improve. The Company has also been successful in raising required capital to commence production and fund ongoing operations, completing a forward gold sale of $1.2 million in 2016 and closing private placements of $1.4 million in the first quarter of 2017. The Company also completed a private placement on October 20, 2017 using the proceeds to reduce debt and pay off the remaining balance on the Golden Chest Mine project.
As a result of its planned production, equity sales and ability to restructure debt, management believes cash flows from operations and existing cash are sufficient to conduct planned operations and meet contractual obligations for the next 12 months.
They have raised (diluted shareholders) a considerable amount this year alone, and three days after stating they believe they have sufficient cash/cash flow to operate for the next 12 months, they file a Reg D looking for an additional $1-5M. How could they not have known they were going to go out for an additional raise three days before, when they filed their quarterly update? Especially when their Reg D states their date of first sale was Nov 3rd.
Someone please enlighten me as to what you see in management that runs a company the way this one appears to be operated.
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