I haven't followed RSG closely since they lost all that money when the previous owners of Bibiani defaulted (was it Noble Mineral Resources???) . That was enough of a debacle for me to write RSG management from my watch closely list.
The statutory financials of RSG looked horrible in FY15, but the underlying financials were not bad. I reckon there could be some upside coming for the SP when RSG annouces to the market some sustainable good performance in statutory financials. That massive impairment last FY can turn many investors away from a company for some time. Hopefully, that was the last of the required impairments to fix up the losses from the Bibiani loans debacle.
As I have posted many times before, it is people that make money for companies. Good management + good operators = good people. The RSG Board makes me nervous as it is mostly people with accountancy/financial industry background. The old MD is still on the Board and the new MD has more investment banking experience than mining engineering experience. Plus he was on the Board of Noble Mineral Resources Ltd and wasn't that the company that defaulted on the finance loans for the Bibiani project from RSG?
So, it still looks risky to me; but if they manage this company properly from now on, then there is likely to be multi bag value accretion in store. I'm willing to take a punt that might provide rewards to any turnaround in the USD POG and I'm hastening slowly on RSG. Presently, it does look under valued if all things are fair and equal!
Cheers
RSG Price at posting:
24.5¢ Sentiment: Buy Disclosure: Held
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