Gold Resource Corp (GORO)

[stock_peeker]

GORO is "behind schedule" on commercial production at the mill. The good news is they are continuing to tune operations and work out the kinks up front.

IMHO, they will announce commercial production during June sometime, but the overall efficiency measures will not be quite what we had been led to expect 6 months ago. Over time operations will become more efficient, but the challenge is to bring new workers up to speed and use good quality control for high efficiency operations. I would expect the CEO has opted for more tuning to get things right before putting the really valuable ore thru the crushers.

There are probably some good business reasons for Reid's not declaring "commercial operations" until things are all going well. It may have to do with Hochschild agreements and when Hochschild can take certain actions (sell stock; buy more stock, etc.) or Reid's plans to issue a few more shares to Hochschild before end of current qtr.

Their continuing with additional drilling has been a positive, so hopefully they can build measure/build reserves significantly this year.

'peeker

ps> I remain a very optimistic longterm holder of GORO, though it has been frustrating to experience the delays along the way.

pps> It would be very helpful to know for sure what Reid's exit strategy is, that is, to continue dealing with the hassles of starting up the mill or just sell the whole company to Hochschild for a large chunk of change.