Ann: Update on Financing and Production, page-71

Bdell
very good note.

Pretty disappointing announcement as it put and end to my hopes that the share price could achieve 7 to 10 cents by year end.

But without the key data such as tons processed and grade you cannot make a definative assessment so you are left to assume the worst which would be as Bdell suggested 42% recovery at full production.

Personally I cant believe recovery could be that low given that first announcement was approaching 55%, then 2 weeks where they said 52.8 then next they said they would average 47% for the quarter starting at 40%, so to average 47% you must be at least 50% for the last half of the quarter.

Then on Friday we get 850 ounces, no explanation, and a comment that it will increase towards 1000 ounces with more optimisation. This optimisation clearly has a long lead time and must be significant.

The only conclusion I can make from the annoucement is that management are sick of having keep updating the market as they go through another major fix and have just decided to just go and do it and concentrate their efforts into financing and the concentrate deal.

The 850 seems like it just a reset to a what they are certain they can achieve and have finally got to under promising and over delivering.

A flat 850 for the next 6 months seems unreralistic as you would expect some small incremental improvements over that period.

Will just have to wait and see, clearly the next 2 critical announcements will be the note and the chinese investors. Both of these would be seen as a significant positive.

Hopefully we still get a Dec qtr outlook which should show us tons and recovery assumption

Unfortunately it's back to the waiting game.

In the meantime who knows what the share price will do, it could easilly trade under 3 cents in the short term. Will only take a few panikers

Longer term current prices still look attractive, but the risks have gone up due to the lower than anticipated cash flow over the next 6 months

The only thing that seems certain is that Adriano will never buy again as no matter what the price is he will always want less.