Aquagold International Inc (AQUI)

[Lochan]

The credit markets are still tight. Even if they weren't, it is the decision of management how to finance the expansion of their operations. Personally, I think it is a smart move to avoid borrowing from a bank to cover expenses during this period of time, in other words, until that time when sales revenues start coming in, in a big way.

It sure looks like the Company is selling shares, but let's not forget that in the future, they can buy back those shares
using accumulated retained earnings, which would surely strengthen our position as shareholders. They are not issuing new shares, so theoretically, there is no dilution.

Knowing that it takes 90-120 days for the payment to come in
once the product has been shipped, and assuming profit margins of around 8-10%, I believe that at some point in the not too distant future, Aquagold will require some serious financing. I don't believe they can get the $10-15M in financing they will need until they can show serious and steady revenues from their contracts with China.

That said, I expect revenues from sales to easily double each year over the next few years ... $10M by 6/30/10, $20M by 6/30/11, $40M by 6/30/12, $80M by 6/30/13. I believe the share price will begin to more closely reflect both Aquagold's progress and its future potential after the results of the 4th Quarter have been posted. Until then, those who have faith in the direction the Company has taken will have to tolerate the negative comments of those who can't give this innovative company time to reveal itself as one of the great turnaround stories of 2010.