Why are posters surprised the company is doing a CR??
A cursory view of the balance sheet would tell you they had little in the way of cash, and a glance at the quarterly cash flows would confirm nothing is coming in but they are spending money on exploration. Don't you think our Directors are aware of these facts??
There's no doubt we have hit the jackpot in relation to the potential resource we have uncovered. And guess what, it will take lots more money to drill it to confirm what's there. Hence the need for a CR.
Having said that, the Directors would also have budgeted for $2.3m coming in by December in relation to the exercise of the 10c options (23 million in total) so need to top up cash by doing a raising now. The raising should not be too dilutionary as they need enough to get through the next round of drilling.
As a previous poster suggested maybe 5 million @ 26c. That would increase the coffers by circa $1.3 million. I suggest it would be more like double that. 10 million shares would increase issued stock by 7.5% when taking into account full exercise of the options.
It's a necessary part of business for an exploration company to raise capital. Get used to it!!
SBR Price at posting:
32.0¢ Sentiment: Buy Disclosure: Held
