Hi J Lamb, I am more than prepared to stand corrected in the knowledge that my understanding of this stuff is admittedly vague! However, I think the confusion has come about by virtue of the company presenting the Con Notes in the financials as a "Cash Inflow". I don't know if that is correct according to what I read about the difference between being cashflow positive and profitable.
We all know that we are not producing enough for the graphite operations to be cashflow positive. Okay, hence why the Cap Raise via Con Notes. I expected this to have appeared elsewhere. Regardless of where it fits into the equation, there will be a surplus (of whatever description due to the Con Notes). I was not disagreeing with CD about the production revenue. It is not enough to be cashflow positive or profitable without the Con Notes... BUT the company knew this and we knew this. So, its no reality check that we would be down the gurglar to the tune of $1.5 mill if it weren't for the Con Notes.
We had a Cap Raise in order to finance both the exploration campaign and continue production ramp-up operations. The Con Notes issuance will be done in tranches essentially to keep us financially afloat... during which time production revenue should improve, opex reduce and sales increase. The market was informed of this situation. Sometimes I think people are just so blinkered that they really don't care enough to bother to even remember the prelude to this stuff... let alone go back to research it.
At the end of the day, it doesn't matter if the term is "profitable" or "cashflow positive". The costs of operations will be covered and there will be a surplus. I think people are still hung up on the cashflow positive bit. We will not be cashflow positive til we are producing in the vicinity of 2,000 tonne per quarter. Hopefully next quarter we will be close.
Okay, I have had enough of giving this a crack... done my bit and bloody well worn out!
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