Finally, Braised, a reasonable person. I have spent quite a few posts trying to explain on the yahoo board why I think the dangerously low cash balance and cash burn we've witnessed over the past 2 quarters (excluding new financing of course) is a major concern, but only get insults and requests to take a finance course in response as I must be some kind of idiot, despite stating obvious facts that are easily verifiable on the cash flow statements in the quarterly report.
Yes, the refund of the backstop must have been pre-agreed with Gramercy as a prerequisite to the receiving the fresh money. Anyway, the interest rate on that backstop was increasing over time to unsustainable levels to force refund. It was supposed to be reimbursed when the Gold Holding money would come in anyway when initially negotiated, only as a temporary fix and was never supposed to reach maturity in 2016.
The 11M cash balance including bullion inventory is crazy low. It is a virtual certainty the company will run out of cash in the next few weeks as Namoya, despite the ramp up, will most certainly still be cash flow negative this quarter (especially with the lower ore grades at 1.50/t they are currently mining).
What next, that is the question. Will Gramercy step in again with another small short-term backstop to save the day until Q4 (I doubt it)? Another streaming for 10M like in April (at worse prices now)? This is getting pretty dire. The streaming deal and forward sales will choke Twangiza cash flows, as right now the co already has to give up ~5,000 oz per quarter. Add the fact that based on guidance, Twangiza prod may go down significantly over the second half, and the situation is extremely concerning.
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