Well of course its not, but if you are the Board of a Company you may very well start to take notice of the way it reacts to your news. In saying this, if I based my investment decisions purely on interim market perspective, I would have missed out on many multi baggers.
Communication, and regular communication at that, is the key to a junior explorers survival in a very unforgiving market. A very carefully planned, executed, ongoing and communicated program is imperative.
Do not treat the market, nor your shareholders as fools!
Since the very positive news of 15 July 2014, KDR have had three opportunities to court the market with their projects.
1) A response to Price and Volume movement
2) A quarterly activities report
3) A maiden resource statement
In my eyes they have failed miserably on all three occasions to inspire confidence in the Company. Now please do not get me wrong here. I am not jumping ship. I am conducting a very big outside looking in revision of one of my investments and as such I will not skip the uncomfortable bits to make myself or anyone else feel better.
1) The Price and Volume movement response should have seized on the recent exit of a suffering significant shareholder and the obvious robust results from Browns
2) A quarterly activities report should not be a cumbersome representation of old news but a refreshing view on the achievements up to the day of the quarterlies release.
3) The maiden resource statement - well anything better than "here you go...... here it is..... its not our focus.....we will have a look at it later...."
Another issue I have with the Company at the moment are the very ordinary maps they have been using. Get rid of them, start again and provide detailed drill plans in three dimensions.
Overhanging all this is the obvious question of when and how much cash are they going to raise?
What must improve and why?
1) KDR must communicate a plan of action moving forward - this plan must include the Company's genuine and realistic achievement goals and timelines
2) KDR must provide a consistent news flow with respect to their progress
3) KDR must communicate their Capital Raising intentions soon - those capital raising intentions must match an aggressive exploration campaign to quickly return value to the shareholders
Browns looks like it could be a very large tonnage resource, but it will need to be Swiss cheesed full of holes to prove it. I would rather see the Company come out and say - hey we are going to raise a bucket load of cash, get 5 drill rigs and start drilling next week, than leave the market scratching its head....
Questions are being asked of the management!
How will they respond?
I am changing my sentiment from 'Buy' to 'Hold' until the management team indicate to me that they are interested in building a real relationship with the broader market and hence abandoning their current perfunctory attitude. They have the capability and so does Browns.
Time will tell
DYOR
KDR Price at posting:
13.0¢ Sentiment: Hold Disclosure: Held
