Monday, March 26, 2012 9:57:01 PM
There's been a lot of information put out in the last couple of days. Perhaps, so much that it will take some time to digest it all. With the caveat that "Nobody knows nuttin," I'd like to add a few comments which will, hopefully, clarify some of my concerns. Nobody has been taking a lot of flack over the dilution issue, but it still is the six hundred pound gorilla in the room. If they need to raise $7,000,000 for expansion that may mean a lot of new shares. He does have a point. It seems to me that we've got the cart before the horse and without any finacial data from the company we're just taking a shot in the dark with our projections. I'm not trying to be cynical, but numbers cited by the PR firm need to be confirmed by the company to be valid. They are, after all, a PR firm hired by the company to increase the share price. and it's not in their best interests to broadcast anything negative about the company.
We are also carrying a pretty significant debt load. We do owe a lot of money. I would like to see the existing debt and liabilities reduced to a more manageable level, if not completely eliminated. For example, we still owe the Feds for fines going back to 2007-8 from the MSHA inspections. Pay down the debt first before thinking about expansion. If we do any expansion, we should do it at BRCM where it will have the quickest effect on the bottom line. If they make that their cash cow, they'll have an easier time financing the other projects. Adding a second shift at the processing plant is the quickest cheapest way to boost revenue. At this juncture we're not even sure if they're breaking even although there are a number of indicators that they are. BRCM has to be up and running profitably for any of the other stuff to be possible. What I want to see is throughput and recovery rate before I start doing a jig. They are still not 43-101 compliant, so you can add that to the "to do" list.
The share buy back proposal is not really an option until they have enough money to do it, so that belongs on the back burner for now. Up to this point, most of their restructuring of debt has been with shares and/or options. I'd sure like to see that stop as soon as possible. Senator Dirksen used to give an annual budget speech where he said, "A billion here, a billion there, and pretty soon you're talking real money." We need to stop hemorraging shares like Nobody has been saying.
Some final thoughts about the mystery third party. I'm just not comfortable with that at all. Somebody outside the company is paying to promote the stock to increase share price. Without knowing who it is, it's not all that difficult to create a number of conspiracy theories related to the promotion (none of which will bode well for the share price in the long run). We're beginning to sound like a P&D with all of this recent activity, and I'm definitely not comfortable with that. Still cautiously optimistic with the emphasis on cautious. Let's see what develops in the next couple of days--should be interesting.
I do think that January and February will be profitable, based on what we've been able to ferret out from a variety of sources. Just a hunch though. \V/_
We are also carrying a pretty significant debt load. We do owe a lot of money. I would like to see the existing debt and liabilities reduced to a more manageable level, if not completely eliminated. For example, we still owe the Feds for fines going back to 2007-8 from the MSHA inspections. Pay down the debt first before thinking about expansion. If we do any expansion, we should do it at BRCM where it will have the quickest effect on the bottom line. If they make that their cash cow, they'll have an easier time financing the other projects. Adding a second shift at the processing plant is the quickest cheapest way to boost revenue. At this juncture we're not even sure if they're breaking even although there are a number of indicators that they are. BRCM has to be up and running profitably for any of the other stuff to be possible. What I want to see is throughput and recovery rate before I start doing a jig. They are still not 43-101 compliant, so you can add that to the "to do" list.
The share buy back proposal is not really an option until they have enough money to do it, so that belongs on the back burner for now. Up to this point, most of their restructuring of debt has been with shares and/or options. I'd sure like to see that stop as soon as possible. Senator Dirksen used to give an annual budget speech where he said, "A billion here, a billion there, and pretty soon you're talking real money." We need to stop hemorraging shares like Nobody has been saying.
Some final thoughts about the mystery third party. I'm just not comfortable with that at all. Somebody outside the company is paying to promote the stock to increase share price. Without knowing who it is, it's not all that difficult to create a number of conspiracy theories related to the promotion (none of which will bode well for the share price in the long run). We're beginning to sound like a P&D with all of this recent activity, and I'm definitely not comfortable with that. Still cautiously optimistic with the emphasis on cautious. Let's see what develops in the next couple of days--should be interesting.
I do think that January and February will be profitable, based on what we've been able to ferret out from a variety of sources. Just a hunch though. \V/_
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