I think the last two weeks have illustrated beautifully my questions with management reporting and the issue with no update of production in this announcement. They were clearly aware they were not coming close to meeting production targets. You could almost argue that they were obliged to have given a separate announcement given such a significant impact on production, but I don't want to go there.
1. In their own words "Open pit mining during the quarter lost 26 days including 15 days lost towards the end of March" So assuming the remaining 7 days in march were lost they had already lost 20 days.
2. "Open pit mining at the higher grade Galaxy pit is due to start in the first week of April, one month behind schedule" Therefore they knew the grades were lower and not able to meet production guidance.
I would just summarise that based on the announcements this month, I would not consider this management shareholder friendly. Don't expect to hear the bad news until the latest possible time. Not necessary meaning a sell at current prices, but not the sort of company I want to trust with my long term holdings, but good for short term leverage on gold price. This is no comment on managements ability, just how much trust I would have to sleep well at nights.
Final comment is that by my calculations, if they had not sold their gold hedging when they did, and did the capital raising, they would now be on the line financially and dependent on June production targets. IMOHO, do your own analysis.
Strangely I have to remain a buy now at current price, will explain in other thread.
BLK Price at posting:
40.0¢ Sentiment: Buy Disclosure: Held
