coming months , page-14

Blokes,

Yes, I have been trying to calmly get this message over for a while.

The wrong numbers in the Q4 report made it impossible to pinpoint the real cash burn situation. The numbers showed that it was most likely in the range of $866k - $1494k burn for the Q4 period.

Q1 now has come out with a burn of $1186k! Thats right in the middle of the range that I suggested months ago. MVH had cash in of about $300k and cash out at $1486K for Q1.

At the same rate of burn, the coffers will be at zero right about Xmas eve. Not a nice present at all. It doesnt look like any great revenue so far in October, so that leaves just Nov and Dec to get some better short term revenue to slow the burn.

Expenditure looks like it will continue at current rates to keep the deals going, so short term revenue is the key.

They have a get out of jail card in their KSX shares and it looks like they will have to sell some this quarter or borrow against that asset.

Some increased short term revenue can push the cash position beyond Xmas, but it would bite somewhere in the middle of Q3 anyway.

The problem with long term success is that you have to survive the short term first in terms of cashflow!

The real reason behind the flagging share price I think is the concern over the short term cash position and how that will be resolved. Its an issue now and over the next few months. Resolution of this issue will drive the price in the short term. If they go to the bottom of the cash barrel, the share price may look very low indeed come Xmas.

I have never attempted to be emotional on this one, but have tried to present all with the issues as I saw them. For the long term player there may well be opportunities to top up as MVH works through its cash position.