borrowings, page-10

"(What happended was the accounting team said we think the aussie dollar will be worth .93 when they did the budget.

So they said to the supplier how much for pipes we are building a mine & we need to know how much we are going to need.)"



Hi Moremoney2,

With all due respect mate, for a non holder, you seem to know a hell of a lot about the company and what has happened behind the scene in secrecy, while many of us don't.
Unless I missed something moremoney, I can't recollect any Announcement from the Company stating as much and detailing exactly what has happened at the time. And, unless you show some evidence, we can only assume that you are assuming at what happened at the time yourself.
Unless of course you are one of the GBG team that know what's happening on a day to day basis, or you have some insider informations/knowledge that none of us are privy to.

As for this part of yours:

"(So at .93 = US$93m - This is the budgeted price in KML books & this is what they went & borrowed - They borrowed in US dollars for a Aussie dollar expense

but when came time to order & pay for it. The aussie dollar was say 1.05. Therefore the ACTUAL cost for those pipes = US$105 - Blowout of $12m )"

That part to me, does not and will not float. For,

A) The company would have had already the money in the Bank in $AUD as soon as the borrowing was done and agreed to.

B) They would have had the money in the bank in $AUD to pay for the work done by KLM as it became due, and that money would have been earning interests while it was in the Bank.

C) When they are due to pay the money back in $USD, GBG would be at an advantage point as they would have to pay less $USD dollars, because the $AUD was higher in value than at the time of borrowing.

If you are saying that they (GBG) have locked in for the all contract at the exchange rate of 93 $AUD cents at the time, (Hedging at the wrong rate), then it could and may be different. But God almighty who'd be so stupid in a Public Company to do such a thing, lol. No one in their right frame of mind would go and lock in that kind/amount of borrowed money without edging some form of security in place.

If that was the case, although I find it very hard to believe, starting from the CEO and right down to the Chairman, should all go and register their names with Centrelink, lol. They would certainly not be worth a Board seat anywhere.

Cheers.