amazing, page-31

Bigbill, my main issue with people going on about Vanmag is the inference that the delay was Conti’s fault. I think that’s why the Director got tetchy at the meeting. I get the feeling they did what they could to facilitate the settlement but the issue was the buyer getting the necessary authority to transfer the funds out of China. One could argue they should have pulled out of the deal earlier and looked to another buyer perhaps but given the state of global finances during this period that could have ended with nothing and it’s a difficult decision to take. I think they had an offer on the table and kept expecting the deal would complete. It’s a bit like buying a house over here, you can agree an offer from someone but unfortunately until the money comes on settlement day, deals can and do fall through. A stressful experience. Hopefully this will be a case of alls well that ends well and perhaps people will think again about just how much blame to attach to Conti for the delay. I think that if they had been more open about what the issues were it would have helped all round, but perhaps they were tied by confidentiality clauses, who knows.

I fully accept that the situation painted at the meeting wasn’t good but some people took the worst possible scenario as being an inevitability that has not proved to be the case. The balance outstanding for Mashala came as a bolt out the blue and over here it was difficult to understand the background as much of the history was before it listed on AIM. Again though my issue and I thank you for seeing where I am coming from, is that mitigating actions were described at the meeting and have in fact moved on but some people on here keep harking back while ignoring the progress made. Regarding communicating the issue, I do remember that there was an ‘Open Briefing’ that the company issued to the market on the day of the General Meeting which included commentary on the financial situation and the options under consideration and I guess this was taken into account when responding to the later ASX query ? For info here’s a link http://www.investegate.co.uk/continental-coal-ltd-%28cool%29/prn/lodgement-of-open-briefing/20120810070000P067D/

My comment on possible defamatory was on any suggestion that the company does not have sufficient funds to meet its ongoing operating expenses without evidence of this. That they stated they needed to raise money is not in doubt, it’s in describing how they are coping since that I think care needs to be exercised.

Regarding refinancing the Loan Notes, they do say there has been significant progress. Perhaps I am reading too much into that but in any event we are told to expect a detailed update this quarter so not long to test that.

Which brings us to valuation. The trouble with the Investec report is not knowing what methodology they are using to derive their values but as I can’t speak to how experienced or knowledgeable the analysts are I am tending to take there figures as a useful guide unless someone can offer anything different. This isn’t like an oil explorer with a wild price target dependent on finding oodles of oil. There is a lot of information available to an analyst to base their work on for Conti and if their valuation is way wrong I’d like to know why rather than just that they are paid to produce the work or are junior staff (your comments on age will resonate with my brother-in –law who rants about pimply faced youths whenever one of his blue chips drop a penny or two on the back of a report !). Conti have a lot of liabilities sure, but they also have a lot of assets that I believe are worth more than the net current market cap. The Investec report contained quite a bit of discounting.

Thanks for the interesting reply back, I think that the upcoming interim results will make for fascinating reading and perhaps clarify more on value. Cheers